Opinion
December 30, 1909.
Edgar N. Dollin, for the appellant.
I.N. Jacobson, for the respondent.
The demurrer was interposed upon the ground that the complaint fails to state facts sufficient to constitute a cause of action. The only theory upon which the learned counsel for the plaintiff attempts to sustain the complaint is that it states a cause of action for conspiracy and that an action will lie against two or more persons to recover damages for acts done by one of them pursuant to a conspiracy with the other or others, where an action could not be maintained against any of them for the same acts committed without a conspiracy with others. No statute conferring a cause of action or prohibiting the acts is cited in support of the action, and the learned counsel for the plaintiff evidently relied upon the common law, and cites Place v. Minster ( 65 N.Y. 89); Verplanck v. Van Buren (76 id. 247); Buffalo Lubricating Oil Co. v. Everest (30 Hun, 588); Park Sons Co. v. Nat. Druggists' Assn. ( 30 App. Div. 508), and Green v. Davies (100 id. 359; revd., 182 N.Y. 499) as authority to support his contention. In Green v. Davies ( supra), Chief Judge CULLEN, writing for the court, said: "There may be cases where acts committed in pursuance of a combination of a number of persons to injure a third person are actionable, while the same acts, if done by a single individual, acting without such concert, would not be actionable. Such cases may be termed actions for conspiracy, but where the conspiracy results in the commission of that which would be an actionable tort, whether committed by one or by many, then the cause of action is the tort, not the conspiracy." It has long been the settled law that the basis and gist of an action for conspiracy are the damages occasioned by the wrongful act of one or more persons, and that the only materiality of the allegations with respect to the conspiracy or combination with those who were not the direct actors, is to connect them with and make them responsible for the acts of the others. ( Hutchins v. Hutchins, 7 Hill, 104; Cooley Torts [2d ed.], 143, 144; Brackett v. Griswold, 112 N.Y. 454.) The acts, which it is alleged resulted in the damages in the case at bar, were committed by the defendant Taylor, and they consisted, first, in filing a petition in bankruptcy against the plaintiff in the District Court of the United States for the eastern district of New York, and filing, on the same day with the same court, a petition for the appointment of a receiver of the plaintiff's property on the ground that he was "removing" his property, and that unless a receiver was appointed the balance of his property would be "removed and that the creditors would receive nothing on account of their respective claims," and that pursuant thereto a receiver was appointed and that the plaintiff was thereby obliged to employ an attorney and interpose an answer and defend the bankruptcy proceeding, and did so with the result that upon the trial the petition was dismissed on the merits. The allegations with respect to the damages are that plaintiff was put to great trouble, inconvenience and expense in procuring witnesses and employing counsel to defend the bankruptcy proceedings, and was deprived of the use of his property for a period of thirty-four days, and that "his credit and business were ruined, that he suffered injury to his good name, fame and standing, and otherwise, in all to his damage in the sum of $15,000." Under the well-settled rule these allegations are insufficient to admit proof of special damages, and would only authorize a recovery of general damages. It is not alleged that Taylor knowingly made any false allegations in either petition to the Federal court, nor is it even expressly alleged that any of the allegations contained in either petition were false. It does not appear upon what ground the bankruptcy proceeding was dismissed. It may have been for the insufficiency of the allegations of the petition, and it may have been for want of satisfactory proof of some material allegations. The complaint, however, fails to charge or show either malice or want of probable cause on the part of Taylor in instituting the bankruptcy proceeding or in applying for the appointment of the receiver, and, therefore, it cannot be sustained as sufficient if the action is to be regarded as one for malicious prosecution. It is true, it is alleged that the application to have him adjudicated a bankrupt and for the appointment of a receiver was made without cause, but those allegations would be true if he had probable cause; but upon a full hearing it developed that the appearances upon which he acted, and which would have warranted a man of reasonable prudence in proceeding thereon, turned out to be groundless in fact. ( Burt v. Smith, 181 N.Y. 1.) The complaint alleges malice in assigning claims to Taylor, but that caused no damage. If he had probable cause, his motive was immaterial, but, of course, the proceeding having terminated, if he acted without probable cause and his course of conduct was instigated by malice, then the case might be regarded as one for malicious prosecution, and he would be liable for the damages which were the proximate cause of his acts. ( Wass v. Stephens, 128 N.Y. 128; Stewart v. Sonneborn, 98 U.S. 187.) It is quite clear, therefore, that if the allegations with respect to the conspiracy be eliminated, no cause of action, even against the defendant who committed the acts which resulted in the damages to the plaintiff, is alleged; and, as already observed, the learned counsel for the plaintiff evidently appreciated this, and bases his right to recover upon the allegations with respect to a conspiracy. It is alleged in the complaint that the acts of Taylor in presenting the petitions were instigated by the other defendants, and were committed pursuant to an understanding and agreement which is characterized as a conspiracy between them to injure the plaintiff in his business. If the complaint stated a good cause of action against Taylor, these allegations would be sufficient to show a cause of action against the other defendants, for they would admit of proof connecting them with the acts which resulted in the damages. If it were a crime for two or more individuals to combine or conspire to do an act which one of them might lawfully do, and this fell within such prohibited acts, it is quite probable that the filing of the petitions would sufficiently constitute overt acts, and it may be that the case then would be one of the class to which Chief Judge CULLEN alluded in the opinion quoted. It may well be that where a statute makes an act by two or more individuals unlawful, which, if committed by one, would not be unlawful, this would give rise to a cause of action for the damages resulting from the execution of the conspiracy, even though there would be no cause of action for the same acts committed by one of the parties to the conspiracy, but, as already observed, no statute is cited, and we have found none which prohibits the acts which it is charged were done by the defendants or by the defendant Taylor. The allegations of the complaint are insufficient — it is not even claimed that they are sufficient — to show the commission of the crime of conspiracy as defined in sections 168 and 169 of the Penal Code (now sections 580 and 581 of Penal Law), and section 170 of the Penal Code (now section 582 of Penal Law) provides that no conspiracy is punishable criminally unless it is one of those enumerated in sections 168 or 169 thereof. The only subdivision of section 168 of the Penal Code which bears at all on the question is subdivision 3, which makes it a misdemeanor for two or more persons to conspire "falsely to institute or maintain an action or special proceeding." Assuming, without deciding, that this would apply to a proceeding in bankruptcy, it is not alleged that defendants conspired or agreed to falsely institute a proceeding, for it does not appear but that, from their standpoint, the facts warranted the institution of the proceeding in bankruptcy, and it is not alleged that they agreed to misstate the facts, or resort to perjury, or to misrepresent anything to the court ( People v. Flack, 125 N.Y. 324; 1 Abb. L. Dict. 478, definition of "false"), and, therefore, even if the action could be maintained, if the facts alleged showed the commission of a crime or were prohibited by law, it does not appear by the allegations of the complaint that the defendants committed the crime of conspiracy, or that the acts which they did or caused to be done were prohibited by law. The cases herein cited — particularly Verplanck v. Van Buren and Buffalo Lubricating Oil Co. v. Everest, as being those relied upon by counsel for the plaintiff — might sustain the action, without proof of want of probable cause, if it were alleged that the defendants agreed to resort to perjury, or to mislead the court or misrepresent any material facts, and that one of them at the instigation of all did so and that the damages were caused thereby; but without some such allegation we have merely the case of two or more persons conspiring to do a lawful act in a lawful manner from which damages flow, and we are of opinion that in such case malicious motives and conspiracy do not give rise to a cause of action which would not otherwise exist. (See Oakes v. Oakes, 55 App. Div. 576; affd., 167 N.Y. 625.)
It follows, therefore, that the interlocutory judgment should be reversed, with costs, and the demurrer sustained, with costs, but with leave to plaintiff to amend on payment of costs of the appeal and of the demurrer.
INGRAHAM, McLAUGHLIN, HOUGHTON and SCOTT, JJ., concurred.
Judgment reversed, with costs, and demurrer sustained, with costs, with leave to plaintiff to amend on payment of costs.