## Facts

- Sharon Graves was a former Skaggs grocery store employee who continued shopping at the store after her employment ended.
- Graves wrote Skaggs two checks totaling about $34.70 from a joint bank account.
- Unknown to Graves, her estranged husband had withdrawn the funds from the account, and the checks were returned for insufficient funds.
- After learning the checks had been dishonored, Graves told Skaggs she would pay as soon as she could obtain the money.
- More than two weeks later, Graves mailed Skaggs a money order covering the full amount of the checks.
- The next day, a Skaggs manager filed a police report alleging a violation of Arkansas’s Hot Check Law (which includes an intent element).
- When Graves later returned to shop at Skaggs, she was arrested at the store on the resulting warrant.
- After a police sergeant learned the checks had been paid, Graves was released.
- Later that day, a Skaggs employee told the sergeant that he did not care that Graves had paid and wanted her prosecuted.
- The criminal case proceeded to municipal court, but the judge dismissed it because the checks could not be produced as evidence.
- Graves sued Texas Skaggs, Inc. for malicious prosecution, alleging humiliation from the public arrest and harm from having the arrest remain on her record.
- A jury found for Graves and awarded damages (reported as $20,000), and Skaggs appealed.

## Issues

1. Whether legally sufficient evidence supported each element of Graves’s malicious prosecution claim: initiation of criminal proceedings by Skaggs, favorable termination, lack of probable cause, malice, and damages.
2. Whether Skaggs had probable cause to accuse Graves of violating the Arkansas Hot Check Law after she made restitution and the surrounding circumstances bore on the required intent.
3. Whether the evidence permitted the jury to find malice, including from Skaggs’s insistence on prosecution despite knowledge that the checks had been paid.
4. Whether the damages award was supported by the evidence and was not excessive.

## Decision

- The Court of Civil Appeals of Texas (Texarkana) affirmed the judgment for Graves.
- The evidence supported the jury’s findings that Skaggs initiated the criminal proceeding, it terminated in Graves’s favor, and Skaggs acted without probable cause and with malice.
- The court upheld the damages award based on evidence of humiliation and reputational harm from the arrest and prosecution.

## Legal Principles

- A plaintiff alleging malicious prosecution based on a criminal case must prove: (1) the defendant initiated or procured a criminal prosecution, (2) the proceeding terminated in the plaintiff’s favor, (3) absence of probable cause, (4) malice, and (5) damages.
- Probable cause depends on whether the defendant had reasonable grounds to believe the accused committed the charged offense; when the offense includes an intent element, facts bearing on intent matter to the probable-cause inquiry.
- Malice may be inferred from the absence of probable cause together with surrounding facts showing an improper motive, including pressing for prosecution after learning information that weakens the basis for the charge.
- A dismissal of the criminal charge for failure of proof can constitute a favorable termination for malicious prosecution purposes.
- Compensable damages in malicious prosecution may include humiliation, reputational injury, and other harm resulting from arrest and criminal accusation; an award will be affirmed absent a showing it lacks evidentiary support or is excessive.

## Conclusion

Texas Skaggs, Inc. v. Graves affirmed a jury verdict for malicious prosecution where Skaggs caused a former employee’s hot-check arrest after she made restitution, and where evidence—including a statement that Skaggs wanted prosecution regardless of payment—supported findings of no probable cause, malice, favorable termination, and damages for the humiliation and lasting effects of the arrest.


Texas Skaggs, Inc. v. Graves, 582 S.W.2d 863 (1979)