Dorene Ltd v Suedes (Ireland) Ltd

JurisdictionIreland
JudgeMr. Justice Costello
Judgment Date01 January 1982
Neutral Citation1982 WJSC-HC 707
Docket NumberNo. 6528P/1979,[1979 No. 6528P]
CourtHigh Court
Date01 January 1982
DORENE LTD. v. SUEDES (IRELAND) LTD.

BETWEEN:

DORENE LIMITED AND DORENE SEPARATES LIMITED
Plaintiffs

and

SUEDES (IRELAND) LIMITED
Defendant

1982 WJSC-HC 707

No. 6528P/1979

THE HIGH COURT

1

Judgment of Mr. Justice Costello Delivered 16th October 1981

Introduction and Legal Principles
2

The Defendant ("Suedes") owns a factory premises in Clanbrassil Street in the city of Dublin. In the year 1979 the first-named Plaintiffs ("Dorene") became interested in leasing it. Negotiations took place between the parties estate agents and then their solicitors and one of the important issues in the case is whether these negotiations resulted in a concluded enforceable contract. Suedes was of the view that they did not and on the 9th October, 1979 told Dorene that it was no longer interested in granting a lease. Within a couple of days Dorene had instituted these proceedings for specific performance and registered lis pendens against the property. Suedes immediately riposted by telling Dorene that if it went on with its action Suedes would claim damages as the proceedings were preventing a sale of its property to a third party. Dorene eventually (on 10th June, 1980) abandoned its claim and discontinued the proceedings. But in the meantime pleadings had been filed and Suedes had counter-claimed damages for the wrongful institution and maintenance of the proceedings: its claim, in effect, being one for damages for the malicious abuse of the Court's process. This is the claim which I now have to try.

3

Dorene's counsel have firstly argued that the Defendant has no cause of action. He accepts that a claim for maliciously instituting criminal proceedings lies and also for maliciously instituting proceedings in bankruptcy and to wind up a company, but he says that no actions lies for instituting a civil action (even one maliciously brought) because the basis of the tort is damage done to the public by the wrongful institution of proceedings and no such injury is suffered by a Defendant in an ordinary inter partes action. It is alternatively urged that even if an action for maliciously instituting a claim for specific performance lies on the facts of this case Suedes" claim is unsustainable. In the light of these submissions I think I should begin this judgment by considering whether the claim which Suedes now is maintaining is one recognised at law, and, if it is, the principles which apply to it.

4

I have no doubt that at common law an action for maliciously abusing the court's processes lay and that such an action is not limited to claims arising from the institution of a criminal prosecution and to bankruptcy and winding-up proceedings. It is an action which in fact has an ancient lineage. This has been traced in Holdsworth "History of English Law" (Volume 8 pages 385 et seq.) who points out that it was during the 16th and 17th centuries that the development of the action on the case gave rise to both the tort of malicious prosecution and the tort of malicious abuse of the process of the courts (page 385). The modern law on the subject is based on a decision of Holt. C.J. given at the end of the 17th century in the much cited case of Saville .v. Roberts (1698) I ld. Ray. 374. It is perfectly clear that at that time an action on the case lay once damage was established, and that the basis of the action was damage to the complainant and not injury to the public. The principles established by Saville .v. Roberts were summarised by Holdsworth as follows (p. 391):

"It was in substance laid down that to succeed in this action, the plaintiff must show firstly one of three sorts of damage (damage to his "fair name", damage to his property, damage to his person). Secondly he must show "express malice and iniquity in prosecution". Thirdly, the ground of action is not conspiracy but the damage and therefore the action will lie though the indictment be preferred by a single defendant only. Fourthly, no action will as a rule lie for bringing a civil action maliciously. Under the old law the amercement of the plaintiff... was, and under the modern law the costs awarded to a successful defendant are, held to be sufficient compensation. But, fifthly, the bringing of the action maliciously or a malicious use of the process of the court may give rise to an action it was assumed ... on the action on the case that the proceedings must have terminated in the plaintiffs favour."

5

There are many reported cases which show that the view urged on Dorene's behalf is incorrect. For example, a claim for damages for the malicious arrest of a ship is one which the law recognises (see: In " The Walter D. Wallet" (1893) P. 20 2). In the course of his judgment the President of the Admiralty Division quoted with approval the words of Lord Campbell in Churchill, .v. Siggers 3 E. and 929, at

"The first question to which I shall refer is whether an action will lie for falsely and maliciously and without reasonable or probable cause presenting a petition to wind up a company, although the company has suffered no pecuniary damage besides the payment of extra costs. I entirely agree that even although civil proceedings are taken falsely and maliciously and without reasonable and probable cause, nevertheless no action will lie in respect of them, unless they produce some damage of which the law will take notice. The present action is in tort, and in order to support it the plaintiff company must have sustained some damage such as the law takes notice of. I assent to the objection taken by the defendant's counsel that the obligation to pay extra costs is not damage of that kind..."

6

When we look back to the decisions of the judges of earlier times... we find it laid down by Hold C.J. in Saville .v. Roberts I Ld. Ray. 374 that there are three heads of damage which will support an action for malicious prosecution. There is damage to a man's person, as when he is taken into custody... To take away a man's person, as when he is taken into custody... To take away a man's liberty is damage of which the law will take notice. Secondly, to cause a man to be put to expense is damage of which the law will take notice. But, Holt C.J., adds a third head of damage, and that is where a man's fair name and credit are injured" (page 683).

7

The Master of the Rolls accepted that the obligation to pay "extra costs" did not amount to special damage but none the less held that the Plaintiff had a cause of action. he pointed out that an action for maliciously procuring an adjudication in bankruptcy lay even though no pecuniary loss is suffered because the proceedings injured the Plaintiff "in his fair name". So, too an action lay for the malicious presentation of a winding-up petition as this would have damaged the company's credit. He then went on to point out that before ruling on a matter of law on the question of reasonable and probable cause the trial judge should have asked the jury to make findings on the disputed question of facts, and that on the question of malice there ???query???s??? evidence to go to the jury that the Defendant in presenting the petition was ???query???

8

The objective nature of the test was adverted to in Tims .v. John Lewis and Co. (1951) 2 K.B. 459 and 130. Tempest .v. Snowden (1952) 1 K.B. 130 was a case in which the Plaintiff claimed damages for malicious prosecution. It was heard in the High Court in England by a judge sitting with a jury. The jury was asked certain questions by the trial judge and having answered them awarded the Plaintiff damages. The appeal to the Court of Appeal turned on the correctness of the questions left to the jury. The appeal failed. In the course of their judgments both the Master of the Rolls and Denning, L.J., expressed views on the question of reasonable and probable cause in claims for damages for malicious prosecution. In the course of his judgment Denning L.J., said:

"In my opinion in order to determine the question of reasonable and probable cause, the judge must first find out what were the facts as known to the prosecutor asking the jury to determine any dispute on that mater and then the judge must ask himself whether these facts amounted to reasonable and probable cause. In Herniman .v. Smith (1938) A.C. 317 Lord Atkin put it quite clearly: "The facts upon which the prosecutor acted should be ascertained: in principle, other facts on which he did not act appear to be irrelevant. When the judge knows the facts operating on the prosecutor mind, he must then decide whether they afford a reasonable or probable cause for prosecuting the accused". If these facts to afford reasonable an probable cause, then the prosecution is justified, and it is not as a rule necessary for an inquiry to be made into the prosecutors belief. The state of his belief goes to malice but not, as a rule, to reasonable and probable cause. This view is supported by the of Tims .v. Johm Lewis and Co. (1951) 2 K.B. 459, 472; "The question whether there was a reasonable or probable cause is not, I think, to be determined subjectively, as has been suggested. It is question which objectively ???query???

9

page 937. "To put into force the process of law maliciously and without reasonable or probable cause is wrongful; and, if thereby another is prejudiced in property or person, there is that conjunction of injury and loss which is the foundation of an action on the case", and he held that this principle applied to the process of arrest permitted by the admiralty procedures. On the question of damages he pointed out "No doubt in an action on the case for commencing or prosecuting an action, civil or criminal, maliciously and without reasonable probable cause, damages must be shown ... But when a malicious action terminates in an arrest of a person, that wrongful detention must of necessity cause some damage to the person who loses his complete liberty ... It appears to...

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