Vancouver Book & Stationery Co. v. L. C. Smith & Corona Typewriters, Inc.

This is a suit for damages for the malicious prosecution of civil actions. The trial below resulted in the direction of a verdict for the defendants.

In 1936 J. A. Hill and W. P. Phillips organized appellant, Vancouver Book & Stationery Co., Inc., to take over the business of a small retail book and stationery store in Vancouver, Washington. Hill undertook to supply not to exceed $5,000 for the venture and Phillips was to have full charge of the business. Each was to receive half the stock in the corporation, but it appears that no stock was ever subscribed for or issued, no stockholders’ meeting ever held, and no corporate officers or directors elected. Hill ultimately became dissatisfied with Phillips’ management of the business, and in August of 1939 he caused an audit to be made from which he learned that he had put $642 more into the Company than he had agreed to invest; and he was given a demand note for that amount executed on behalf of the Stationery Company by Phillips.

A few days later Hill sued on the note and attached the business, and the attaching officer placed a keeper in charge. Hill’s purpose in taking this action, as he later explained it, was to get rid of…