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Freides v. Sani-mode Mfg. Co.

DECEMBER 2, 1964.




Appeal from the Superior Court of Cook County; the Hon. WILBERT F. CROWLEY, Judge, presiding. Reversed.


This appeal is taken from a judgment awarding $25,000 in damages for malicious prosecution, against the individual defendant, Manny Stern, and the corporate defendant of which he was president and principal shareholder, Sani-Mode Manufacturing Company. *fn1 Plaintiff alleged that Stern and Sani-Mode (by Stern) appeared before a grand jury on June 24, 1948 and falsely, maliciously and without probable cause charged plaintiff with "unlawfully, feloniously and fraudulently taking and converting to his own use," with the intent to steal, plastic film worth $5,000. It was alleged that defendants "caused" the return of an indictment on that date. This indictment was nolle prossed because defective in attributing the ownership of the property to Stern instead of Sani-Mode. Stern again testified before the grand jury, in response to subpoena, and a second indictment was returned November 17 similar to the first except that it substituted the name of Sani-Mode Manufacturing Company. Plaintiff was found not guilty in a trial before a jury on February 25, 1949. He then instituted his suit for malicious prosecution, which was twice dismissed for want of prosecution. The present judgment was obtained in a 1962 trial, almost fourteen years after the acts complained of.

The evidence discloses that from August, 1947 plaintiff was a subcontractor for Sani-Mode, which processed and sold plastic products such as tablecloths and curtains. Rolls of material sent by defendant were cut and sewn by plaintiff to certain specifications at an agreed price per dozen items. Stern testified that he did not compute the yardage to be used from the rolls for particular orders. Instead, more was sent than needed, and from time to time plaintiff was given additional orders to be filled from the excess yardage which, though Sani-Mode's property, remained in plaintiff's possession. Likewise, plaintiff's office manager stated that she made no record of the amount of material left on the rolls at the completion of a particular order, but plaintiff would just keep cutting until the rolls were used. She testified that sometimes she ran short of Sani-Mode plain border material and used the same kind of plain plastic which was bought by plaintiff from another source. She would let this credit accumulate until it reached a full roll before balancing the account by appropriating a roll sent by Sani-Mode, but she did not inform defendant of this practice.

On June 15, 1948, plaintiff himself subcontracted some work by sending four rolls of plain material, claimed to be his own, to American Cutting and Binding Company to be cut into curtain borders. Plaintiff's office manager testified the rolls were shipped in old cartons which bore Sani-Mode labels, and when a question arose about the order, American Cutting called Sani-Mode by mistake.

In response to this call, first Levy, an employee of Stern, then Stern, and eventually his lawyer, proceeded to plaintiff's factory on June 16, where Stern said he recognized 70 rolls of Sani-Mode's exclusive patterns comprising 5,000 yards of plastic material. Fifty-five rolls were in original packages and fifteen had been opened.

Stern testified that he protested to plaintiff, "How come it has been several months since we have discontinued these patterns and you still got them here, and you told me you don't have any more of our goods?" To which plaintiff replied, "I bought these from St. Lawrence Textile." Stern then asked, "You bought the same patterns we have?" and plaintiff answered, "Yes." Stern then asked to see the bills which would show that plaintiff had bought the goods, but plaintiff did not produce any. Instead, according to Stern, plaintiff, after a little while, said "Stern, I am doing you wrong. . . . I did you wrong, I am willing to make good, let's see how much goods belong to you, and we will pull it out and I will agree to let you have it."

Plaintiff and his office manager testified they had been planning to go into business for themselves and had accumulated material from several companies, one of which was the aforementioned St. Lawrence Textile company, which had supplied Sani-Mode with exclusive patterns. Plaintiff introduced a bill for several thousand dollars from St. Lawrence dated the previous January in support of his explanation, but the bill does not indicate what patterns were involved, nor was there any evidence that it had been exhibited to Stern prior to commencement of the criminal proceedings. Plaintiff claimed that, although he had asked St. Lawrence for Sani-Mode's exclusive patterns, he had been unable to obtain them.

Plaintiff did not testify to the quantity of Sani-Mode material on the premises at the time of the confrontation, but merely said: "I didn't have too much on hand. I had a lot of goods cut up and had to be finished."

Plaintiff testified: "Stern said he will arrest me and put me in jail, you can fight me if you want, but you haven't enough money to fight me." Also, according to plaintiff, defendant's lawyer said to plaintiff: "Mr. Freides, I've got to tell you something, you know I am a good friend of yours, take my advice, give up whatever you have, machines, the equipment, everything, sign it over, and we will do you no harm." The lawyer denied giving this advice, and Stern denied making any threat to plaintiff.

After plaintiff had called his lawyer and much discussion had ensued, Stern and his men were ordered off the premises and they departed without the goods.

The next day defendants started a replevin suit in the Municipal Court of Chicago, and, after filing bond, Stern returned to plaintiff's place of business with a bailiff and a writ of replevin for various materials which he testified he had seen there the day before. They found but a part of the property listed therein. An order entered after trial of the replevin action two years later found the right of property in Sani-Mode to 2,571 yards of plastic material, 302 tablecloths, 1,142 curtains and 159 garment bags. These items evidently were the ones that had been recovered by the bailiff. The suit for the rest of the property was dismissed on January 18, 1951, upon stipulation.

A second replevin suit, filed by Sani-Mode against American Cutting and Binding Co., resulted in the recovery of the four rolls of plastic sent there by plaintiff. Plaintiff did not intervene in that suit.

Defendants kept the goods recovered in the two replevin suits but did not sue for the value of the remainder. Plaintiff claimed, and Stern appears to have agreed, that labor charges of $1,500, outstanding at the time of the confrontation, were paid by defendant at the time the first replevin suit was dismissed.

Plaintiff and his office manager claimed that an accounting was made in October of 1949, when the manager and plaintiff's bookkeeper examined the records with Stern's employee, Levy, and found that more material had been returned by the plaintiff than he had received. Stern denied this, asserting that Levy at that ...

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