Title: Shoemaker v. SELNES
Citation: 220 Or. 573, 349 P.2d 473
Docket Number: N/A
State: Oregon
Issuer: Oregon Supreme Court
Date: February 10, 1960

Affirmed February 10, 1960.
Petition for rehearing denied March 8, 1960.
*575 R.W. PicKell, Salem, argued the cause and filed briefs for appellant.
T.W. Churchill, Salem, and Manley B. Strayer, Portland, argued the cause for respondents. With them on the brief were E.L. Crawford, Salem, R.H. Huntington and Hart, Rockwood, Davies, Biggs &amp; Strayer, Portland.
Before McALLISTER, Chief Justice, and SLOAN, O'CONNELL and HARRIS, Justices.
*576 AFFIRMED.
HARRIS, J. (Pro Tempore)
This is an action for malicious prosecution. After the plaintiff rested his case, the court sustained the motions of defendants Arnold Selnes, Jens Svinth, and G. Carroll Meeks for judgment of involuntary nonsuit. The court also sustained the motion of defendant The United States National Bank of Portland for a directed verdict in its favor after the latter had rested its case without presenting evidence. From a judgment based on said rulings, the plaintiff appeals.
The plaintiff, Jack A. Shoemaker, was the president and principal stockholder of Washington Creamery Co., a corporation (hereinafter referred to as the processor), located in Silverton, Oregon, and engaged in the marketing and processing of turkeys. Defendant Arnold Selnes (hereinafter referred to as the grower) was a turkey grower.
In December, 1954, the grower turned over certain turkeys to the processor. This transaction and the financial arrangements which draw the defendant bank and its officers, the defendants Svinth and Meeks, into the picture are fully set forth in the related case of Montgomery v. United States National Bank et al., decided this day.
Subsequent to the transaction mentioned in the foregoing paragraph, on March 16, 1955, a criminal action was instituted against the plaintiff in the district court of Marion county, Oregon, upon a complaint sworn to by the defendant Arnold Selnes, charging the plaintiff with the crime of embezzlement by bailee of the turkeys in question. After a preliminary hearing, plaintiff was bound over to the grand jury *577 and later indicted by that body. Plaintiff was subsequently tried on this indictment in the circuit court in June, 1955, and was acquitted by the jury.
The principal assignments of error complain of the court's rulings in sustaining the respective motions of the defendants above referred to and in refusing to admit into evidence certain material hereinafter mentioned.
The record indicates that the trial court allowed the motions for nonsuit and directed verdict principally upon the grounds that plaintiff had failed to prove that the criminal proceedings were instituted against the plaintiff without probable cause, and that plaintiff was actually guilty of the offense for which he was prosecuted.
1. The elements of a cause of action for malicious prosecution are:
See also 34 Am Jur 703, Malicious Prosecution § 2; 706, § 6; 707, § 8; 715-716, § 22.
It thus appears that plaintiff must not only prove that the prosecution was instituted because of an improper purpose (other than that of bringing an offender *578 to justice), but must also prove as an additional element that the proceedings were initiated without probable cause. 3 Restatement 382, Torts § 653; id. 404, § 662; id. 423, § 668; 34 Am Jur 729, 731, Malicious Prosecution § 46.
2. Moreover, in order to recover, plaintiff must not have been guilty of the offense charged. 3 Restatement 382, Torts § 653; id. 390, § 655; 34 Am Jur 741, Malicious Prosecution § 58; 747, § 70; 788-789, § 147.
3. For the moment we will pass the question of upon whom lies the burden of proof with reference to the last-stated matter. However, the fact that the person against whom a criminal proceeding is instituted is actually guilty of the crime charged against him is a complete defense against liability for instituting or pressing such proceeding. Under this rule the guilt or innocence of the person accused in a criminal proceeding may be retried despite the termination of those proceedings in his favor. This is so even though the accused was acquitted after trial by a verdict of not guilty. 3 Restatement 393, Torts § 657; Meyer v. Nedry, 159 Or 62, 67, 78 P2d 339; Eastman v. Monastes, 32 Or 291, 51 P 1095.
4. In fact, the acquittal in the criminal case is not even prima facie evidence of want of probable cause for the prosecution. Eastman v. Monastes, supra, at p. 297; 34 Am Jur 740-741, Malicious Prosecution § 58.
5. It must be remembered a verdict of not guilty in a criminal proceeding is not necessarily a finding the accused was innocent. It may, and often does, mean no more than that the jury were not convinced of his guilt beyond a reasonable doubt. 3 Restatement 393, *579 Torts § 657; 34 Am Jur 740, Malicious Prosecution § 58.
6. Let us now turn to the question of probable cause. 3 Restatement 403, Torts § 662, sets forth the elements of probable cause as follows:
7, 8. From the foregoing we note that if one who initiates a criminal proceeding reasonably believes that the person accused has acted in a certain manner and correctly believes that such act constitutes the offense charged, the accuser has probable cause for his initiating the criminal proceedings.
9. The acquittal of the accused by the jury is not *580 evidence of lack of probable cause. Meyer v. Nedry, supra. It is not even prima facie evidence of want of probable cause. Engelgau v. Walter, 181 Or 481, 492, 182 P2d 987.
Having stated the principles of law applicable to probable cause, we must now determine the function of the court and jury in passing upon and determining this necessary element in an action for malicious prosecution.
In Kuhnhausen v. Stadelman, 174 Or 290, 310-311, 148 P2d 239, 149 P2d 108, this court, speaking through Mr. Justice Lusk, held:
10, 11. In other words, where the facts or circumstances under which defendant acted are in dispute, such issue must go to the jury with instructions from the court that certain facts, if found to exist, do or do not constitute probable cause. However, if there is no conflict in the evidence the question of probable cause is a question of law for the court. 3 Restatement 434, Torts § 672. Where there is no conflict in the evidence as to what the circumstances were, the court solely must determine the question of lack of probable cause. Id. 437-438, § 673. Plaintiff has the burden of persuading the court that the circumstances under which the defendant acted did not give him reasonable cause for initiating the criminal proceedings. Drake v. Anderson, supra, p 103; 3 Restatement 434, Torts § 672.
12. The bindover at the preliminary hearing and the grand jury indictment are prima facie evidence of probable cause. Hryciuk v. Robinson, 213 Or 542, 551, 326 P2d 424; Thienes v. Francis, 69 Or 165, 169, 138 P 490.
*582 The crime charged against defendant (plaintiff here) in the criminal proceedings was a violation of ORS 165.010, which reads as follows:
13. It has been expressly held by this court that an intent to defraud is not a necessary ingredient of the crime with which defendant was charged in the criminal proceedings.
In contending the issue of probable cause was a question of fact for the jury, the plaintiff argues as follows:
Again, plaintiff's position is set forth as follows:
It thus appears that plaintiff relies upon the position that the transaction consisting of turning over the turkeys (fully set forth and described in Montgomery v. United States National Bank et al.) was a sale and not a bailment. Plaintiff has addressed no *584 argument to this court based upon the assumption that the transaction was a bailment. However, this court held on similar basic and determinative facts, not necessary to again review here, in Montgomery that the transaction was, as a matter of law, a bailment and that the hypothecation and pledging of the turkeys constituted a wrongful conversion thereof. We make a similar holding in this case. We also hold that the wrongful conversion condemned by ORS 165.010 is no different in kind or degree from the conversion we determined, as a matter of law, occurred in Montgomery.
14. The evidence discloses that before the criminal charge was initiated defendant Selnes learned that the turkeys had been pledged and hypothecated without his authority and without his knowledge. It now appears that such acts constituted a violation of an existing statute, ORS 165.010. Therefore, we hold, as did the trial court, that plaintiff has failed, as a matter of law, to prove an essential ingredient of malicious prosecution, lack of probable cause. On the contrary, we hold as a matter of law that the defendant Selnes had probable cause to institute the criminal proceedings.
Moreover, the record shows, under legal principles heretofore discussed, that as a matter of law plaintiff did commit the offense charged in the criminal proceedings. This again shows the existence of probable cause and is a complete defense to the instant action. Prosser, Torts (2d ed) 651-652, § 98; 34 Am Jur 788-789, Malicious Prosecution § 147.
Plaintiff contends that guilt of the offense charged is an affirmative defense that must be pleaded and proved by defendant. While we have found no authority which squarely holds that guilt of the offense *585 charged must be affirmatively pleaded, there are several cases which hold it is not necessary to plead guilt, but it may be shown under a general denial. Bruley v. Rose, 57 Iowa 651, 11 NW 629, 631; Illinois Cent. R. Co. v. Anderson, 206 Ky 600, 268 SW 311; Coleman v. Reed Bros. &amp; Co., 18 Ohio App 316; 34 Am Jur 773, Malicious Prosecution § 118.
This is probably true because the issue of guilt is so closely allied to the issue of probable cause. Thus it is stated in 34 Am Jur 788, Malicious Prosecution § 147:
Moreover, in this case the matter of plaintiff's guilt appears as a matter of law from his own case. In such a posture the situation is similar to defendant's reliance on plaintiff's contributory negligence as a matter of law to defeat recovery when such negligence appears from plaintiff's own case. Wallace v. Portland Ry., L. &amp; P. Co., 103 Or 68, 204 P 147.
Plaintiff urges that whether probable cause existed is not dependent upon the actual state of the case, but upon the honest and reasonable belief of the party commencing the proceeding. Watts v. Gerking et al., 111 Or 641, 222 P 318, 228 P 135. What is meant by this statement is explained in 34 Am Jur 789, Malicious Prosecution § 147, as follows:
In earlier paragraphs we have mentioned that plaintiff assigns as error the ruling of the court in refusing to admit certain offered testimony. Plaintiff claims the court erroneously refused to admit evidence relating to a claimed custom in the turkey industry. The offer of proof made with reference to the rejected testimony was made in two parts. As to the first part of the offer, there appears to be no proper question propounded to the witness relating to custom. The question asked by counsel for plaintiff is: "What is the marketing procedure after they are brought into the plant?" In the offer of proof plaintiff's counsel stated: "I believe that last evening I asked the witness, Mr. Shoemaker, questions with regard to the matter of custom and usage in the trade, particularly as it pertains to the transaction between Washington Creamery and Arnold Selnes and involving these 1468 turkeys." As indicated above, the record shows that such a question was not directed to the witness.
Counsel for plaintiff then made an offer of proof as follows:
*588 The offer relates to certain "manners" of doing business that were customary in the trade. The only one that could be applicable here at all is the "third manner." However, this offer relates to an agreement between the parties as to price. Thus this offer assumes a fact not supported by the record; i.e., an agreement between the parties as to price. Moreover, none of the methods involves a custom whereby the processor would be entitled to the beneficial ownership and use of the turkeys delivered, except by cash sale transaction, which is not claimed in this case. The first offer is otherwise so vague and uncertain that we are at a loss to comprehend its meaning. It relates to dealing in the east not covered in this case. The custom of getting advances from the broker to cover the processing charges for the turkeys would not aid the plaintiff in the instant case because the advance here was over twice the amount of the processing charges.
The second offer of proof was as follows:
In the first place the offer is insufficient because it merely states "I believe" the witness would testify. Such a statement is no assurance that the witness would so testify.
Moreover, the custom relates to a situation where the grower is unable to pay the processing charges when the turkeys are delivered. There is no evidence of such inability in this case. The last sentence of the offer relates to an assumption made by the processor, which, of course, would not relate to nor be proof of a custom. This offer does not relate to a custom which would authorize a processor to treat delivered turkeys as his own.
The foregoing offers of proof were properly rejected. We also again refer to our decision in Montgomery relating to the subject of custom and usage.
15. The court did not err in refusing to admit into evidence a report covering a cash sale of other turkeys which are not connected with this case.
*590 We have examined plaintiff's other assignments of error and have found no ruling of the trial court which would be ground for a reversal in the instant appeal.
Under the record in this case the liability of the defendants Svinth, Meeks and the bank is dependent upon the liability, if any, of the defendant Arnold Selnes.
In view of the conclusions herein reached, the trial court did not commit error in granting the motions of defendants for nonsuit and directed verdict. The judgment appealed from is, therefore, affirmed.