Dоuglas D. REEVES and Carol Ann Reeves, Appellants-Plaintiffs, v. Alan AGEE and Lamar Lawson, Appellees-Defendants.
No. 60289.
Supreme Court of Oklahoma.
Feb. 14, 1989.
As Corrected Feb. 24, 1989.
CONCLUSION
In his investigation of a possible embezzlement, the detective was acting as an arm of the state to guarantee the execution of state laws. A municipal police officer engaged in the investigation of criminal activity acts as a state agent, and as such, the officer constitutes a “government authority.”20 The release of information by the bank employee violated the Act.21
CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF APPEALS VACATED; JUDGMENT OF THE TRIAL COURT REVERSED AND REMANDED.
HARGRAVE, C.J., OPALA, V.C.J., and LAVENDER, SIMMS, DOOLIN and ALMA WILSON, JJ., concur.
HODGES and SUMMERS, JJ., concur in result.
underpinning to support the agency relationship.).
John B. Hayes, Messrs. Looney, Nichols, Johnson & Hayes, Oklahoma City, for appellee-defendant Alan Agee.
Alan Agee, Messrs. Garvin, Agee & Meisel, Pauls Valley, for appellee-defendant Lamar Lawson.
OPALA, Vice Chief Justice.
In a malicious prosecution action, in which judgment was rendered on the defendants’ demurrers to the petition and the plaintiffs’ new trial motion was denied, the issues prеsented for decision are: 1) Were the errors committed in the malicious prosecution suit preserved for our review by specific allegations in the plaintiffs’ new trial motion or by argument presented in open court and without objection at the hearing of that motion? 2) Were the present plaintiffs a “prevailing party” in the former suit, with legal status to bring a malicious prosecution action? 3) Was the challenged malicious prosecution petition vulnerable to defendant-Agee‘s demurrer for want of an allegation that the antecedent suit had been brought without probable cause? 4) Was the petition facially untimely under the applicable statute of limitations? 5) Was the defendants’ interposition of a supervening-cause barrier to the plaintiffs’ claim available as a ground for demurrer to the petition? and 6) Were errors in ruling on the slander-of-title theory of recovеry preserved for our review? We answer the first and second questions in the affirmative, and the third, fourth, fifth and sixth in the negative.
THE ANATOMY OF LITIGATION
Douglas D. Reeves and Carol Ann Reeves [collectively called Reeves] brought a malicious prosecution action against Lamar Lawson [Supplier] and Lawson‘s legal counsel, Alan Agee [Agee or lawyer]. The trial court gave judgment to both defendants on their separate demurrers to the petition and denied Reeves’ new trial motion.
A. The Challenged Petition‘s Allegations
Reeves were engaged in the cement block manufacturing business. During the period between 1972 and 1974 they had received and paid for sand sold to them by the Supplier on open account. Some of the sand delivered in 1972 was used for the construction of a building on Reeves’ business property. In March 1975 the Supplier delivered for use in manufacturing cement blocks a load of contaminated sand; Reeves refused to pаy both for that load as well as for some others initially pure sand—that, after being intermixed with the later-furnished contaminated material, also became utterly unusable. The Supplier threatened to place a lien on Reeves’ property unless the entire balance due were paid. At a meeting where the circumstances of Reeves’ default were discussed, Reeves’ then attorney informed the Supplier that the materials for which collection was sought were not lienable, though an action could be brought to recover their price on open account. Contrary to this advice, the Supplier, acting in concert with Agee, caused a lien to be placed on Reeves’ property by means of a false statement reciting that some of the material for which payment was being sought had been
Reeves had made arrangements to convey their plant premises to the First National Bank of Pauls Valley [Bank] in exchange for full release of a secured obligation. When prepared documents were scheduled for execution, the Supplier‘s lien claim surfaced and the Bank delayed closing so Reeves could have this cloud removed. Reeves then met with Agee and disclosed to him all the facts showing the lien statement to be false and the Supplier‘s claim to have been impressed for the purpose of coercing Reeves’ payment of an “unjust open account debt.” Agee also became aware that the lien was blocking Reeves’ transfer of the premises to the Bank. The Supplier and Agee reacted by amending the original lien statement to allege that the sales contract with Reeves had its inception three years earlier. With full knowledge of the falsity of the original and the amended lien statements, the Supplier and Agee, acting in concert and conspiracy, caused a foreclosure suit to be brought against Reeves and the Bank, with the malicious intent of “tieing up” Reeves’ real estate. The Supplier‘s foreclosure suit, instituted without probable cause and to secure priority over the Bank‘s first mortgage lien, destroyed Reeves’ opportunity to avoid further liability on their mortgage to the Bank by deeding the premises to the latter. The Bank then pressed its suit for mortgage foreclosure and later secured a deficiency judgment.
The trial court adjudged on August 31, 1978 that the Supplier had no materialmen‘s lien claim against Reeves’ property. Reeves rely on this ruling, from which no appeal was lodged, as the successful termination of the antecedent litigation and the foundation for their malicious prosecution action. The essence of Reeves’ claim is that the Supplier wrongfully encumbered their property with a false lien for more than two years, which prevented them from escaping the legal consequences of impending foreclosure. Actual damages, alleged to be $57,087.28 (the amount the Bank would have taken for the property had it been unencumbered), and punitive damages of $150,000 were sought.1
B. The Trial Court‘s Judgment on Demurrers and its Postjudgment ruling on New Trial Motion
On January 7, 1983 the trial court gave judgment to Agee and to the Supplier on their separate demurrers to the petition,1 assigning but one reason for its decision—the antecedent Supplier‘s lien foreclosure suit against Reeves did not terminate in Reeves’ favor. Taking judicial notice of that suit, to which reference was made in Reeves’ petition, the trial court ruled that the Supplier was the only prevailing party in the prior case. He was the one awardеd the full amount of recovery on open account even though his lien claim was later defeated.2 When the successor judge denied Reeves’ new trial motion on May 3, 1983, he added two other reasons for the earlier judgment—(1) the malicious prosecution action was time-barred; and (2) as a matter of law, there could be no causal connection between the Supplier‘s filing of a materialmen‘s lien statement and Reeves’ allegedly lost opportunity to give the Bank a cloud-free title in the mortgaged premises. We now reverse the nisi prius decision and remand the cause for further proceedings.
C. Interconnected Appellate Litigation
The Supplier‘s suit spawned a number of interconnected appellаte litigation, all initiated by Reeves. The first of these was their unsuccessful appeal from a default ruling for the Supplier on the money phase of the claim, rendered after Reeves had failed to appear at trial and to present a defense [Reeves I].5 Reeves’ second appeal from the deficiency judgment for the Bank also met with an adverse outcome [Reeves II].6 The present appeal is from judgment on the defendants’ demurrers in Reeves’ malicious prosecution action against the Supplier and Agee for pressing a false lien claim [Reeves III].
I
THE APPEAL IS NOT DISMISSIBLE FOR REEVES’ FAILURE TO PRESERVE ERRORS IN THEIR NEW TRIAL MOTION
The Supplier and Agee urge this appeal is dismissible because the errors in the resolution of the malicious prosecution claim, which they present for review, were not preserved by specific allegations in Reeves’ new trial motion.
The critical ground on which Reeves’ new trial motion rests is:
“The Court committed fundamеntal error in that its decision is contrary to law; the Petition of plaintiffs is not demurrable on its face as a matter of law.”7
The trial court‘s judgment on the defendants’ demurrers was not rendered in open court and had not been reduced to writing when the new trial motion was filed. Reeves urge that because they did not know the precise basis for the decision when it came to be rendered, they alleged error in terms broad enough to encompass any ground the trial court might have chosen. The ruling stood memorialized when the motion was later reached for hearing. The sole basis assigned as a ground for the decision was that one element of an actionable malicious prosecution claim was missing—Reeves did not prevail in the Supplier‘s earlier suit.
While a party need not press for a new trial to bring an appeal from an adverse decision,8 if a motion is filed, the
The trial judge‘s successor presided at the hearing on the new trial motion.12 Each specific defect sought to be invoked as a ground for new trial—all of them fairly comprised within the general allegations of Reeves’ motion—was argued without objection. The order denying the motion recites two additional grounds to support the judgment on the defendants’ demurrers. Reeves’ petition-in-error and brief-in-chief assign as error each of the grounds given by the trial court in its ruling on motion for new trial.13 The errors urged on appeal were hence properly preserved for our review.
II
THE RECORD SUPPORTS REEVES’ STATUS AS A PREVAILING PARTY IN THE FORMER SUIT
In a malicious prosecution action the plaintiff must allege and prove these elements: 1) the defendant‘s institution of the former action; 2) its termination in plaintiff‘s favor; 3) the defendant‘s want of probable cause for pressing the former suit against the plaintiff; 4) the presence of malice in defendant‘s conduct; and 5) damages.14
The order denying new trial held the second element was absent as a matter of law because Reeves did not prevail in the former action. Taking judicial notice of the judgment roll in the prior suit,15 the trial court ruled that the Supplier had sought to recover on two theoriеs—a money claim for the unpaid account and a materialmen‘s lien claim in the same sum. It also concluded that, although on May 1, 1978 the trial court had ruled in Supplier‘s favor on the money claim phase of the suit, Reeves later prevailed in their defense against the impression of a lien claim.
A demurrer cannot reach beyond the four corners of the tested pleading and those parts of the judgment roll16 in some other finally terminated case before the same court to which reference is made in that pleading.17 The function of
An appellate court cannot take judicial notice of material which, though properly available for notice by the trial court, has not been incorporated into the record on appeal.19 Admissions made in the briefs may be considered as supplementing and curing an otherwise deficient appellate record.20
The challenged petition does not inform us either that money recovery had been sought in the Supplier‘s earlier suit or that it was secured on May 1, 1978.21 That pleading recites merely that the foreclosure phase of the Supplier‘s claim terminated in a ruling for Reeves. The petition‘s reference to the Supplier‘s suit doubtless authorized the trial court to look beyond the four corners of the challenged petition to consider, in ruling on defendants’ demurrers, the judgment roll in the earlier case and to take judicial notice of its content.22 Because the judgment roll in the earlier suit has not been included in the appellate record tendered for our review in this appeal, there is here absolutely no record from the prior case for our consideration.23 The parties unequivocally admit in their briefs that the trial court ruled on May 1, 197824 for the Suppliеr on the latter‘s claim for money, while the lien phase of the dispute, later resolved in Reeves’ favor, was decided on August 31, 1978.25 Were it not for these critical admissions in the parties’ briefs, failure to incorporate the judgment roll from the earlier suit would have been fatal to Reeves’ appeal.26 Without the admitted facts, we would be compelled to affirm because the
When a plaintiff‘s suit alternately invokes two remedies for vindication of a single cause of action—e.g., a common-law claim for money and an equitable claim for foreclosure of a lien—the resolution of each alternate remedy may bring forth a different prevailing party. In The Company, Inc. v. Trion Energy29 the plaintiff brought a civil claim seeking two alternate remedies—either money recovery for rent due with damages to rental equipment, or lien impression with foreclosure. The trial court ruled in favor of the plaintiff on the first-invoked remedy and for the defendant on the second. The party prevailing in each remedy phase was awarded counsel fees—the plaintiff‘s award сame to be rested upon contract and the defendant‘s was premised on the authority of
Because in the Supplier‘s suit Reeves, much like the defendant in Trion, defeated the lien claim against their premises, we hold that they were entitled to a prevailing-party status for the institution of their malicious prosecution action.32
III
REEVES’ PETITION IS NOT CHALLENGEABLE BY DEMURRER FOR LACK OF OTHER REQUISITE ELEMENTS OF MALICIOUS PROSECUTION CLAIM
When a demurrer is sustained on a wrong ground, this court will consider all grounds assigned, and the judgment will nonetheless be affirmed if any of the grounds may be deemed to have been well taken.33
Agee‘s demurrer also challenges the petition for its failure to state that the Supplier‘s earlier action had been brought without probable cause.34 His demurrer alleges this element of Reevеs’ malicious prosecution claim was not averred but rather was sought to be supplied by the allegation that Agee should have known his client was laying claim to an invalid lien. The order denying new trial does not address this issue. Instead, it states that although lawyers may under some circumstances be sued for malicious prosecution conducted in a client‘s behalf, the present action was time-barred and Reeves could not maintain it since they were not a prevailing party in the former suit.
We know of no rule which gives lawyers absolute immunity from liability for malicious prosecution.35 A demurrer can reach no more than issues of law apparent from the face of the pleading to which it is directed.36 Only if the challenged pleading conceded all the critical facts, from which but a single inference could be drawn, would probable cause or lack of it ever present a pure question of law for the court.37 Reeves’ petition alleges that Agee was informed about Reeves’ past dealings with the Supplier and that, armed with this information, the lawyer should have known there was no legal basis for a materialmen‘s lien claim. Whether Agee knew or should have known his client‘s lien claim was “bogus” or whether he acted in concert with the latter in a malicious endeavor to impress an invalid materialmen‘s lien presents a fact issue not reachable for resolution by Agee‘s demurrer.
IV
REEVES’ MALICIOUS PROSECUTION ACTION IS NOT BARRED BY LIMITATION
Another reason assigned as a ground for the trial court‘s denial of new trial is that the malicious prosecution action was time-barred. The successor trial judge concluded that the time to bring Reeves’ suit began to run May 1, 1978 when the Supplier secured a favorable deci-
Comparing the facts recited in the Reeves I opinion39 with the admissions in the appellate briefs,40 we note a conflict as to the date when the Supplier‘s lien claim was decided. The Court of Appeals, which had the May 1, 1978 money claim decision under review, states in its opinion the lien claim ruling was reached the same day as the other.41 The parties’ briefs are in complete agreement that the lien claim issue, reserved on May 1 for a later resolution, did not come to be determined in Reeves’ favor until August 31, 1978.
Under the Code of Civil Procedure,42 the procedural regime in force at the time this case was decided below, a defendant could raise by demurrer the de-
fense of limitation if the untimeliness of the action were apparent from the petition‘s four corners.43 We noted in Part II, supra, that the trial judge properly took judicial notice of the judgment roll in the earlier Supplier‘s action when ruling on the demurrers and that any fact either stipulated or admitted in the brief may be cоnsidered as an acceptable supplement to a deficient appellate record.44 Any such admitted fact would control over contrary recitation in an appellate opinion rendered in another case unless it was apparent from that opinion‘s context that the recited fact‘s consideration was necessary for the adjudication process to settle some point of law for the case at hand.45 An appellate opinion has a binding effect only to the extent that it pronounces the settled law for the case.46 It is clear to us that the May 1, 1978 recitation was not relevant to any point of law settled in Reeves I. We hence can look only to August 31, 1978 as
The trial court‘s postjudgment order here under review, which added the issue of limitation as an additional ground for rendering judgment on the defendants’ demurrer, states that the time to bring Reeves’ malicious prosecution suit began to run frоm the May 1 ruling. Agee and Supplier argue that Reeves’ cause of action first arose when the Bank was no longer willing to accept a deed in lieu of foreclosure and that this occurred when the May 1, 1978 ruling became a money judgment lien on the property in contest.
As we view the applicable law, the question to be answered here is whether the one-year period to bring malicious prosecution suit48 commenced when the trial court first ruled on the claim for money or when it later decided the lien claim. Generally, the limitation period begins to run at the termination of the earlier action that is alleged to have been maliciously brought.49 Because the lien claim alone is asserted to be the malicious demand upon whose previous judicial rejection relief is now sought to be founded, and Reeves were indeed successful in defeating that claim, we hold thе limitation period began to run on August 31, 1978 when the Supplier lost its quest to impress a lien. The malicious prosecution action, instituted less than a year later, was hence timely brought.
V
DEFENDANTS’ ARGUMENT THAT THE CHAIN OF CAUSATION WAS BROKEN BY THE SUPPLIER‘S PERFECTION OF A JUDGMENT LIEN COULD NOT BE CONSIDERED IN PASSING ON THEIR DEMURRERS
The trial judge also ruled as a matter of law that there was no causal connection between Reeves’ lost opportunity to deed their property to the Bank in lieu of foreclosure and the Supplier‘s quest for a materialmen‘s lien that was denied on August 31, 1978. His order states that the May 1, 1978 ruling on the money claim became a judgment lien upon Reeves’ premises and that it was this lien—rather than the materialmen‘s lien claim—which prevented Reeves from satisfying the mortgage debt by deeding the encumbered premises to the Bank. The impression of a judgment lien, the trial court ruled, broke any causal nexus between Reeves’ failure to give cloud-free title to the Bank and the August 31, 1978 ruling for Reeves on the lien issue. The court concluded as a matter of law that no act by the defendant, occurring within one year of the filing of Reeves’ malicious prosecution suit, could have caused the damage Reeves suffered from the Bank‘s deficiency judgment.
In reaching this conclusion the trial court apparently took judicial notice that the money claim ruling of May 1, 1978 did constitute a judgment and was perfected as a judgment lien against Reeves’ real property.50 That fact, even if true, was
bar relitigation of only those issues that were actually settled in Reeves I. Mobbs v. City of Lehigh, supra note 46 at 549. In short, nothing can be deemed to have been settled by Reeves I as the law for that case which was neither raised nor decided in the appeal.
Even if we were absolutely sure the May 1 ruling was effective as a money judgment, we could not hold as a matter of law that Reeves’ reference in their petition to the earlier suit by the Supplier incorporated into that pleading all the extraneous material which would be necessary for the trial court to consider before concluding that the May 1 ruling stood in the status of a judgment lien. The trial court‘s judgment docket is not a constituent component of its judgment roll in a given case and hence could not be noticed for consideration in passing on a demurrer. See discussion infra note 53.
tender an issue that was not resolvable on a demurrer.55 We hence hold the petition was impervious to demurrer on the defendants’ legal theory that lack of proximate cause for Reeves’ claim to damage from a lost opportunity to avoid foreclosure is apparent from the face of Reeves’ petition, viewed in conjunction with that extraneous material to which reference was made in the body of their challenged petition.
VI
ERROR, IF ANY, IN SUSTAINING A DEMURRER TO REEVES’ SLANDER-OF-TITLE THEORY OF RECOVERY WAS NOT PROPERLY RAISED ON APPEAL
Reeves argue that they plead facts sufficient to support a claim not only for malicious prosecution but also for slander of title. They assert the trial court erred in sustaining demurrers to the petition because all the necessary elements of a slander-of-title action were present.56
ery could be sought. If facts are alleged which support any theory of recovery, a general demurrer must be overruled. Burford v. Territorial Land Co., 84 Okl. 102, 204 P. 274, 275 [1922].
CONCLUSION
The malicious prosecution petition is impervious to attack by demurrer for failure to state a cause of action. The claim does not facially appear to be barred by limitation. Reeves failed to properly preserve for review, error in denying the claim of slander-of-title.
The trial court‘s judgment on the defendants’ demurrers is reversed; the cause is remanded for further proceedings not inconsistent with this pronouncement.
LAVENDER, SIMMS, DOOLIN and KAUGER, JJ., concur;
HARGRAVE, C.J., concurs in result;
SUMMERS, J., concurs in part and dissents in part;
HODGES, J., dissents.
SIMMS, Justice, concurring:
I concur with the opinion of the majority insofar as it reverses the trial court‘s sustention of demurrers and pronounces judgment accordingly. I agree the claim does not appear to be barred by limitations and that Reeves failed to properly preserve for review, error in denying the claim of slander-of-title.
MARIAN P. OPALA
VICE CHIEF JUSTICE
Notes
“(b) The Court failed to memorialize and file an order setting forth the reason or reasons for which the demurrer was sustained all in violation of certain provisions contained in
“The right of a party to perfect an appeal from a judgment, order or decree of the trial court to the Supreme Court shall not be conditioned upon his having filed in the trial court a motion for a new trial, but in the event a motion for a new trial is filed in the trial
“If a motion for a new trial be filed and a new trial be denied, the movant may not, on the appeal, raise allegations of error that were available to him at the time of the filing of his motion for a new trial but were not therein asserted.” [Emphasis added.]
See also Horizons, Inc. v. KEO Leasing Co., infra, note 11 at 759, and Faulkenberry v. Kansas City Southern Ry. Co., Okl., 661 P.2d 510, 513 [1983].
“1. The Court erred in failing to find that plaintiffs were prevailing parties in the first action capable of bringing a malicious prosecution action, by virtue of the first court‘s finding that the defendants’ lien claim was invalid.
2. The Court erred in finding the plaintiffs’ suit, filed on July 11, 1979, to be barred by the Statute of Limitations by finding that plaintiffs’ suit related to an Order of May 1, 1978 concerning thе money judgment issue, rather than an Order of August 31, 1978 concerning the validity of a lien claim.
3. The Court erred in failing to find defendant Agee, as the attorney for defendant Lawson in the former civil action, may be held liable for malicious prosecution.
4. The Court erred in finding that plaintiffs’ Petition stated a negligence action rather than a malicious prosecution claim against defendant Agee.
5. The Court erred in finding no possible causal connection between plaintiffs’ inability to convey marketable title to their property and the invalidity of the lien claim of Lamar Lawson.
6. The Court erred in finding that there were no disputed facts in question, and therefore, allowing the Demurrer to be sustained.”
Errors asserted in Reeves’ brief-in-chief are:
1. “The trial court could not properly sustain the appellees’ general demurrers if any facts entitling the Reeves to any relief were stated in the Reeves petition.”
2. “The Reeves’ petition stated faсts sufficient to satisfy all of the elements of a valid cause of action under a malicious prosecution theory and thus was not vulnerable to defendants/appellees’ general demurrers.”
3. “The Reeves’ petition stated facts sufficient to satisfy all of the elements of a valid cause of action under a slander of title theory and thus, was not vulnerable to defendants/appellees’ general demurrers.”
4. “The trial court‘s finding that the Reeves’ petition could not be amended to state a cause of action and the court‘s failure to timely state the grounds upon which the demurrers were sustained prevented the Reeves from amending their petition and constituted error.”
5. “Appellee Agee, acting as counsel for appellee Lawson in the prior action, is liable for his personal actions under either a malicious prosecution or a slander of titlе theory.”
6. “Appellants’ petition was filed in time to satisfy the statute of limitations under either a malicious prosecution or slander of title theory, and thus, was not vulnerable to appellees’ demurrers.”
Judicial notice—the court‘s cognizance of adjudicative facts without any proof—is part of our evidence law. See Oklahoma Evidence Code,
The legal effect of a finally adjudicated case is measured by the four corners of its judgment roll, and, in making this assessment, no other part of a terminated case can be considered. Timmons v. Royal Globe Ins. Co., supra, and Mayhue v. Mayhue, Okl., 706 P.2d 890, 895 [1985].
“In an action brought to enforce any lien the party for whom judgment is rendered shall be entitled to recover a reasonable attorney‘s fee, to be fixed by the court, which shall be taxed as costs in the action.”
The terms of
“An issue of law arises upon a demurrer to the petition, answer or reply, or to some part thereof.” [Emphasis added.]
The terms of
“An issue of fact arises: First, Upon a material allegation in the petition, controverted by the answer; or, second, upon new matter in the answer, controverted by the reply; or, third, upon new matter in the reply, which shall be considered as controverted by the defendant without further pleading.”
“Civil actions other than for the recovery of real property can only be brought within the following periods, after the cause of action shall have accrued, and not afterwards:
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Fourth. Within one (1) year: An action for ... malicious prosecution,....” [Emphasis supplied.]
