Court Opinion

ID: 8894574
Source: CourtListenerOpinion
Date Created: 2022-11-26 23:44:34.770147+00
Date Added: 2024-06-11T17:07:24.064148
License: Public Domain

Chief Judge Eagles
dissenting.
I concur in the result but dissent on the issue of the relevance and admissibility of the over-billing testimony. The majority held that Housecalls’ billing practices were irrelevant to the claims stated by the plaintiff and Robert Nowell’s testimony should not have been allowed into evidence at trial. The majority went on to hold that even if the billing practices of Housecalls were relevant, the billing evidence was highly prejudicial compared to the slight probative value of the evidence. After careful review, I disagree.
The four elements of a malicious prosecution claim are 1) that defendant initiated the earlier proceeding; 2) that there was malice on the part of defendant in doing so; 3) that there was a lack of probable *754cause for the initiation of the earlier proceeding; and 4) that the earlier proceeding was terminated in favor of the plaintiff. Best v. Duke University, 337 N.C. 742, 749, 448 S.E.2d 506, 510 (1994), reh’g denied, 338 N.C. 525, 452 S.E.2d 807 (1994). In an action for malicious prosecution, the malice element may be satisfied by a showing of either actual or implied (legal) malice. Best v. Duke University, 112 N.C. App. 548, 552, 436 S.E.2d 395, 399 (1993), affd in part, rev’d in part on other grounds, 337 N.C. 742, 448 S.E.2d 506 (1994).
“Actual malice ... is defined as ‘ill-will, spite, or desire for revenge, or under circumstances of insult, rudeness or oppression, or in a manner evidencing a reckless and wanton disregard of [plaintiffs] rights.’ ” (Citations omitted). Actual malice, which “is more difficult to substantiate ... is only required if plaintiff is seeking punitive damages.” (Citations omitted). Implied (or legal) malice, on the other hand, “may be inferred from want of probable cause in reckless disregard of plaintiff [s’] rights.” (Citations omitted).
Moore v. City of Creedmoor, 120 N.C. App. 27, 43-44, 460 S.E.2d 899, 909 (1995), aff'd in part, rev’d in part on other grounds, 345 N.C. 356, 481 S.E.2d 14 (1997). Want of probable cause may not be inferred from malice for purposes of determining whether there is a cause of action for malicious prosecution but malice may be inferred from want of probable cause. Cook v. Lanier, 267 N.C. 166, 170, 147 S.E.2d 910, 914 (1966).
Here, all four elements of a malicious prosecution claim have been met with respect to Housecalls and Terry Ward. Through Mr. Ward, Housecalls initiated the criminal proceeding against plaintiff. Mr. Ward, the owner of Housecalls, told his employee, Ms. Stewart, to go to a magistrate and get a warrant for plaintiff’s arrest. In addition, there is some evidence that the defendants lacked probable cause. The magistrate issued the warrant but the district attorney dismissed the charges against plaintiff because plaintiff had returned the items he had allegedly “wrongfully” withheld from defendants. See Pitts v. Pizza, Inc., 296 N.C. 81, 87, 249 S.E.2d 375, 379 (1978), but see Best v. Duke University, 337 N.C. 742, 448 S.E.2d 506 (1994). The only real element in issue is whether the defendants displayed malice in prosecuting plaintiff.
Based on the law of North Carolina, it is clear that the court can infer legal or implied malice from the lack of probable cause. However, Housecalls’ illegal billing practices are relevant to support *755the notion that defendants harbored actual malice towards plaintiff when they initiated the prosecution against plaintiff.
Housecalls was defrauding Medicaid by double billing the government. Plaintiff had knowledge of these illegal billing practices and defendant knew that plaintiff had knowledge of these practices and could be a persuasive witness in administrative proceedings. When plaintiff noticed that defendant was double charging Medicaid for the same medical expenses and told his supervisor, defendant Terry Ward, Mr. Ward stated that any over-billing would be reconciled. Moreover, when plaintiff resigned, he prepared a letter of resignation citing problems with the accounting system which caused him “multiple ethical dilemmas.” Copies of this letter were posted throughout defendants’ office. At the time plaintiff resigned, defendants were well aware that the plaintiff had knowledge of their dishonest billing procedures. Furthermore, when the district attorney tried to explain to Mr. and Mrs. Ward that there was no way she could win the case since plaintiff had returned the cell phone and pager, Mr. and Mrs. Ward said: “That’s not the point.” Mr. and Mrs. Ward demanded that the district attorney proceed with the case. Defendants’ desire to press forward with plaintiff’s prosecution even after the items in question had been returned suggests that the “point” of the prosecution was to mar plaintiff’s personal and professional reputation as a CPA and undermine his credibility as a witness in subsequent proceedings. All this evidence is relevant to substantiate the actual malice element in plaintiff’s malicious prosecution claim. Accordingly, the trial court did not err when it admitted the evidence of Housecalls’ billing practices.
The majority opinion also addresses Mr. Robert Nowell’s testimony. Mr. Nowell is the Assistant Director of the State Division of Medical Assistance, Program Integrity Section. Mr. Nowell was a corroborating witness and testified about Housecalls’ illegal billing practices. In the event of a new trial, Mr. Nowell should be allowed to testify but the trial court should carefully limit his testimony to evidence that actually corroborates other testimony.
Accordingly, I agree with the majority and would grant a new trial but would allow Housecalls’ billing practices into evidence through both plaintiff and Mr. Nowell to show actual malice.