Case ID: ad_99/html/0316-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Hatch, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

George W. Bankell, Respondent, v. Edward Weinacht, Appellant.
    
      Action foi'false imp'isonment and malicious prosecution — burden of proof as to malice and want of probable cause — when a question for the cowrt and when for the jury—probable cause does not depend upon guilt or innocence—a failure to make p'oper inquiry changes a party only with such knowledge as it would have afforded—false statements in the affidavit charging the offense—lapse of time after the offense and before the prosecution—the fact that the accused had started a rival business is not material on the question of probable cause.
    
    In an action brought to recover damages for false imprisonment and malicious prosecution, it appeared that from August, 1898, to January 10, 1901, the plaintiff was employed as a solicitor of export business and as a collector of unpaid freight bills by an express company of which the defendant was the general manager; that in August, 1899, the defendant discovered that the plaintiff had collected several sums which he had neglected to pay over to the express company; that the plaintiff admitted his delinquency, and that it was arranged that the amount of the deficit should be deducted from his salary from time to time, which arrangement was duly carried out; that in January, 1901, the plaintiff left the employ of the defendant’s company to enter the service of a rival express company; that shortly thereafter the defendant discovered that various persons held'receipted bills for sums which appeared to be due from them upon the books of the company; that among such receipted bills was that of one John Boyle, which amounted to four dollars and sixty-eight cents, and which was receipted for in the plaintiff’s handwriting; that the defendant, after making careful investigation of the matter among his customers and employees, laid the whole matter before the company’s attorney; that the attorney, after a thorough investigation of the whole subject, advised that the plaintiff was guilty of larceny; that the defendant then caused the plaintiff to be arrested upon a charge of the larceny of four dollars and sixty-eight cents; that the plaintiff, after being tried upon such charge and acquitted, brought the present action.
    The plaintiff admitted that he received the four dollars and sixty-eight cents from Boyle, but claimed that, as there was no one present in the office of the defendant’s company when he attempted to turn the money over, he made a memorandum of the amount and placed it upon the bookkeeper’s desk, and that he never saw or heard anything concerning it until he was arrested upon the charge of larceny.
    Upon an appeal by the defendant from a judgment entered upon a verdict in favor of the plaintiff, and from an order denying the defendant’s motion for a new trial made upon the minutes, it was
    
      Held, that it was incumbent upon the plaintiff to prove that the prosecution was instituted through malice and without probable cause;
    That, where the facts bearing upon the question of profiable cause are not disputed, that question is one of law for the court to determine; but that where the evidence bearing upon the question is controverted and conflicting or involves the credibility of witnesses, the question becomes one of mixed law and fact and must be submitted to the jury under proper instructions;
    That the question whether there was probable cause for the prosecution does not depend upon the guilt or innocence of the accused, but upon whether the apparent facts were such that a discreet and prudent person would be led to the belief that the accused was guilty;
    That the plaintiff had failed to show that there existed a lack of probable cause for the prosecution, but that, on the contrary, the undisputed facts established that there was probable cause for the prosecution;
    That, assuming that the defendant should, before beginning the prosecution, have made inquiries of an assistant cashier in the employ of his company, who had left such employ at the time of the investigation, he would be chargeable with no more knowledge than she could have imparted to him if he had consulted her, and that, as the knowledge which she could have imparted would have increased his belief in the plaintiff's guilt, his failure to make inquiries of the assistant cashier did not negative the existence of probable cause;
    That the fact that in the affidavit upon which the warrant was issued the defendant averred that the plaintiff failed, neglected and refused to pay over the money to the express company, when it was conceded that the defendant had made no demand upon the plaintiff for the money, did not establish that the defendant had made a false affidavit and thus indicate a lack of probable cause, for the reason that the affidavit was to be construed as alleging an omission to pay over rather than the making of a demand and an affirmative refusal;
    That the fact that eight months had elapsed since the misappropriation and before the issue of the warrant did not establish a want of probable cause, it appearing that only a short time had elapsed between the close of the defendant’s investigation and the plaintiff’s arrest;
    That lack of probable cause could not have been inferred from the fact that the arrest was not made until the plaintiff had started in a rival business, and until seven days after the defendant had begun a civil suit against the plaintiff charging him with unfair competition, for the reason that these facts did not bear upon the question of probable cause but upon the question of malice; That lack of probable cause may not be inferred from proof of malice.
    O’Brien, J., dissented.
    
      Appeal by the defendant, Edward Weinacht, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 13th day of Hay, 1904, upon the verdict of a jury, and also from an order entered in said clerk’s office on the 18th day of Hay, 1904, denying the defendant’s motion for a new trial made upon the minutes.
    
      Richard Reid Rogers, for the appellant.
    
      Joseph M. Proskauer, for the respondent.
   Hatch, J.:

The plaintiff, George W. Bankell, was arrested upon the 11th day of April, 1901, upon a warrant sworn out by the defendant, charging him with the larceny of four dollars and sixty-eight cents. Upon his examination before the magistrate he was held for trial and gave bail in the sum of five hundred dollars. Upon the 7th day of June, 1901, he was tried in the Court of Special Sessions and acquitted, and thereupon he brought this action for malicious prosecution and false imprisonment. The plaintiff was an employee of the Morris European and American Express Company, with which company he remained from August, 1898, to January 10, 1901. His duties were those of a solicitor of export business and collector of unpaid freight bills. In August, 1899, the defendant Edward Weinacht, who was the general manager of the express company, discovered that Bankell was short in his accounts and that he had collected several small amounts which he had failed to turn over to the company. When questioned about it Bankell admitted that he had not turned over certain of such moneys. Thereupon an arrangement was made between the parties, under which the amount of the deficit was to be deducted from plaintiff’s salary from time to time in small amounts. This arrangement was carried out and the money paid. Upon the trial the defendant testified that the amount of the shortage thus adjusted was from forty to fifty dollars, while the plaintiff testified that it was only about twenty dollars. The exact amount is not now material. The defendant also testified that when he made the arrangement for the payment of the deficit he believed that the plaintiff would serve the company faithfully and pay over all moneys collected by him, and for this reason he was retained in his employment and subsequently his wages were raised. Plaintiff continued with the company until about the 10th day of January, 1901, when he engaged in business with the Merchants’ European Express Company, which he was largely instrumental in organizing, and the latter company became a sharp rival of the defendant’s company in the express business. After the plaintiff had left the employ of defendant’s company and in February, March or April, the defendant discovered that bills which were apparent obligations of persons and corporations doing business with the company had been paid; thereupon he made careful investigation of the matter and discovered that various persons held receipted bills for the sums appearing to be due from them upon the books of the company, amounting to forty or fifty dollars. This money, so far as the defendant was able to discover from the books and employees of the company, whom he consulted, had not been paid over. Among the receipted bills was that of John Boyle, amounting to four dollars and sixty-eight cents, which was unaccounted for, and the receipt for which was signed by the plaintiff. After making the investigation, the defendant laid the whole matter before the attorney of the company for advice concerning the matter and the liability of the plaintiff in relation thereto. The attorney made a thorough investigation of the whole subject and, after such investigation, he advised that the plaintiff was guilty of larceny. After receiving this advice the defendant caused the plaintiff to be arrested upon such charge. The plaintiff admitted the misappropriation of the moneys, the amount of which was deducted from his salary. He disputed the amount, but he did not dispute the fact of the misappropriation. He also admitted that the receipt held by Boyle was in his handwriting, and that he had received the money; he claimed that after he received it, as there was no one present in the office to whom he could give the money, he made a memorandum' of the amount and from whom it was received and placed it upon the desk of the bookkeeper, and that he never again saw or heard anything concerning it until he was arrested upon the charge of larceny.

The law is well settled that the burden is devolved upon the plaintiff to prove that the prosecution was instituted through malice and without probable cause.

The latter question becomes one of law for the determination of the court. Where the facts are not in dispute it is error to submit such question to the jury; but where tlie evidence upon the subject of probable cause is controverted and conflicting, or it involves the credibility of witnesses, then it becomes a mixed question of law and fact, and is required to be submitted to the jury under proper-instructions as to the law. , (Fagnan v. Knox, 66 N. Y. 525.) In that case it was said: u The question of what constitutes probable cause does not depend upon whether the offense has been committed in fact, nor whether the accused is guilty or innocent, but upon the prosecutor’s belief, based upon reasonable grounds. (4 Cush. 238.) The prosecutor may act upon appearances, and if the apparent facts are such that a discreet and prudent person would be led to the belief that the accused had committed a crime, he will not be liable in this action, although it may turn out that the accused was innocent, (53 N. Y. 17.) If there is an honest belief of guilt, and there exist reasonable grounds for such belief, the party will be justified.” This rule has received the uniform sanction of the courts. (Anderson v. How, 116 N. Y. 336; Kutner v. Fargo, 34 App. Div. 317; Scott v. Dennett Surpassing Coffee Company, 51 id. 321.) Tested by these rules, it seems clear that the plaintiff failed to adduce proof from which the court was authorized to find a lack of probable cause in instituting this prosecution. Upon the conceded facts it appeared that plaintiff, in the course of his employment, had misappropriated moneys in a similar manner to that with which he was charged in the warrant. It was not claimed that the money which the plaintiff was charged with misappropriating ever reached the treasury of the company, and it did not appear credited upon its books. So far as investigation of this transaction disclosed facts, it showed that money belonging to the company had been received by the plaintiff, and that it had not been paid over by him to the company. Examination of the books, conversations with employees, an examination of Boyle’s receipt and the fact that no trace of the money could be found after it reached the hands of the plaintiff, coupled with the fact that he had previously in like manner misappropriated moneys belonging to the company, presented a condition where the ■only rational conclusion to be drawn was that the plaintiff had collected the money and kept it. Standing alone, this condition would necessarily produce in the mind a conviction that the plaintiff had failed to account for the money he was charged with misappropriating. The defendant made careful investigation among the company’s customers and its employees, and then laid the whole matter before counsel for advice before taking any steps in the matter. It is difficult to see why this action and all the circumstances were not sufficient to furnish a prudent and cautious man with reasonable grounds to believe that the plaintiff had misappropriated the money. As was said in Kutner v. Fargo (supra) of conditions no stronger than the present: “ The facts thus presented being undisputed the question is one of law. These facts do not admit of two inferences. They were either sufficient to constitute probable cause or insufficient.” There was no conflicting evidence requiring submission to a jury in order to determine the conclusion of fact to be drawn, as in every essential aspect the facts stood undisputed. There need be no aspersion cast upon the plaintiff’s character in saying that the condition authorized the inference that probable cause existed. Such question was required to be determined upon these facts and not upon explanatory and exculpating circumstances subsequently developed, of which the defendant had no knowledge and would have obtained none in the exercise of reasonable care and prudence.

It is said, however, that inquiry should have been made of Miss Sachs, a stenographer and assistant cashier employed by the company. She was sworn as a witness upon the trial, and testified that all cash collected was to be turned in to the defendant or to her, and when turned in to her she would initial the bills to show that she received the money. Assuming that the defendant in the exercise of extreme caution ought to have seen this witness, who had then left the employ of the company, he would' have been chargeable with no more knowledge than she could have imparted had he consulted her, and her knowledge consisted in the fact that the plaintiff had not turned over the money which he was charged with misappropriating to her, and her initials were not upon the receipted bill, nor were the bills turned in to her, nor did the defendant pretend that he delivered either bill or money to this witness. Information which she could have imparted prior to the arrest simply increased the weight of the testimony in showing the existence of probable cause.

It is further claimed that the defendant made a false affidavit upon which the warrant issued, and that this fact indicated a lack of probable cause. The falsity claimed consists in the statement that the plaintiff failed, neglected and refused to pay over the money to the express company. It was conceded that the defendant made no demand upon the plaintiff to pay the money, and, therefore, it is said that the statement is false that he refused to pay over the money. We are of opinion that the affidavit is not susceptible of this construction. It was the plaintiff’s duty to turn over the money after being received, and if he failed it operated in law as a refusal upon his part to perform the duty which rested upon him, and the affidavit is to be construed as referring to the omission to pay over rather than that a demand was made, followed by an affirmative refusal of compliance.

The plaintiff also claims that want of probable cause can be gathered for the reason that no demand was made upon the defendant for a return of the money and that he was not arrested until eight months after the alleged larceny. It was not essential that a demand should be made in order to justify a reasonable ground of belief of the plaintiff’s guilt, if the facts existing justified it as they clearly did. While the delay between the misappropriation and the issue of the warrant was eight months, yet the defendant’s investigation into the plaintiff’s acts did not close until some time in February, March or April, and plaintiff was arrested on the eleventh day of April. Mo inference justifying a lack of probable cause can, therefore, arise from this fact.

Claim is also made that probable cause can be inferred from the fact that the plaintiff started in a rival business; that seven days before the arrest defendant began a civil suit against the plaintiff, charging him with unfair competition. These facts did not bear upon the question of probable cause, but bore upon the question of malice in instituting the prosecution. It is well settled that lack of probable cause may not be inferred from proof of malice. (Besson v. Southard, 10 N. Y. 236.) Upon the whole case we are of opinion that the plaintiff failed in bearing the burden of showing that there existed a lack of probable cause. On the contrary, we think that upon the practically undisputed facts the existence of probable cause in instituting the prosecution was established to exist.

It, therefore, follows that the judgment and order should be reversed and a new trial granted, with costs to the appellant to abide the event.

Van Brunt, P. J., Ingraham and McLaughlin, JJ., concurred; O’Brien, J., dissented.

Judgment and order reversed, new trial ordered, costs to appellant to abide event. 
      
      
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