Vol. 77, No. 12, December
Court of Appeals Digest
This column summarizes selected published opinions of the Wisconsin
Court of Appeals. Prof. Daniel D. Blinka and Prof. Thomas J. Hammer
invite comments and questions about the digests. They can be reached at
the Marquette University Law School, 1103 W. Wisconsin Ave., Milwaukee,
WI 53233, (414) 288-7090.
by Prof. Daniel D. Blinka & Prof. Thomas J. Hammer
Revocation of Motor Vehicle Dealer License - Judicial Review of
Revocation Order - Failure to Serve Division of Hearings and Appeals
All Star Rent A Car Inc. v.
Wisconsin Dep't of Transp., 2004 WI App 198 (filed 23 Sept.
2004) (ordered published 28 Oct. 2004)
An entity that "sells, leases, exchanges, buys, offers or attempts to
negotiate a sale, consumer lease or exchange of an interest in motor
vehicles" must obtain a "motor vehicle dealer" license from the
Wisconsin Department of Transportation (DOT) (see Wis. Stat.
§§ 218.0101(23), .0114(1)). If the DOT seeks to revoke or
suspend a license it previously granted to a motor vehicle dealer, it
may do so only by persuading the Wisconsin Division of Hearings and
Appeals (DHA), after a hearing upon notice to the licensee, that there
are proper grounds to do so. A person aggrieved by a DHA decision may
obtain judicial review as provided for in Wis. Stat. chapter 227.
In this case the petitioner's motor vehicle dealer license permitted
it to sell motor vehicles to retail buyers. The DOT instituted an
administrative proceeding with the DHA to revoke the petitioner's
license, and the DOT prevailed in that proceeding. The petitioner then
sought judicial review in the circuit court, naming the DOT as
respondent. The petitioner did not name the DHA as a party nor did it
serve the DHA with notice of the court action.
The circuit court dismissed the dealer's petition because the dealer
had not served the DHA. In a decision authored by Judge Deininger, the
court of appeals reversed. It concluded that the statutes prescribing
which administrative entity a petitioner is required to serve in order
to comply with section 227.53(1) are ambiguous and that the petitioner's
service of its petition on the DOT was sufficient to permit the circuit
court to consider the merits of the petition.
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Judgment Docket - Duty to Include Address of Judgment Debtor
Commercial Mortgage &
Fin. Co. v. Walworth County Clerk of Circuit Court, 2004 WI App 204
(filed 29 Sept. 2004) (ordered published 28 Oct. 2004)
Linda Frykholm pleaded guilty to federal criminal charges. As a
result, a preliminary order of property forfeiture in favor of the
federal government was filed. Commercial Mortgage & Finance Co.
(Commercial) challenged the forfeiture, asserting a priority claim to
the property based on a deficiency judgment it had obtained against
Frykholm and the docketing of the judgment on the judgment docket. The
United States opposed Commercial's challenge, contending that the
docketing of the judgment did not create an enforceable lien because the
docket entry did not include Frykholm's address. The federal district
court ruled against Commercial and forfeited the property to the federal
government (subject to another entity's priority interest).
Commercial then served a notice of claim on Walworth County in which
the company alleged that the circuit court clerk had failed to perform
her statutory duty pursuant to Wis. Stat. section 806.10(1) by failing
to include Frykholm's address when entering Commercial's deficiency
judgment on the judgment docket. The county denied the claim, and
Commercial commenced this case against the clerk. The circuit court
dismissed the action, finding that the judgment submitted by Commercial
did not provide Frykholm's address and that the clerk did not have the
duty to search for the address and add it to the judgment docket.
In a decision authored by Judge Nettesheim, the court of appeals
affirmed. Construing section 806.10 as a whole and recognizing the
entire statutory scheme as it pertains to the judgment debtor's address,
the court of appeals concluded that the judgment creditor has the
responsibility to provide the clerk with the judgment debtor's address.
The creditor may do this by initially providing such information in the
judgment or by later using an affidavit procedure to supply the
The court found that its interpretation of section 806.10 conforms to
the usual and accepted procedure of preparing and submitting judgments.
Typically, the prevailing party prepares the judgment. If the prevailing
party fails to include requisite information in the judgment, "the clerk
should not be burdened to do that party's work, much less be held liable
to that party for failing to do so" (¶ 16).
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Payment of Debt - Statute of Limitation
Liberty Credit Servs. Inc.
v. Quinn, 2004 WI App 202 (filed 29 Sept. 2004) (ordered
published 28 Oct. 2004)
A collection agency, Liberty, obtained a judgment against a credit
card debtor for approximately $18,000. On appeal the debtor contended
that the action was time barred. Liberty had filed its action on Sept.
27, 2001, which was more than six years after what the debtor alleged
was her "last payment" to the credit card company on June 21, 1994.
Liberty contended, however, that the debtor "made an additional payment
on Sept. 28, 1995. Liberty also described a telephone conversation with
[the debtor] on April 11, 2000, during which she authorized a $250
payment toward the account," a payment that the debtor later blocked
(¶ 3). The trial court held that the June 21, 1994 payment extended
the statute of limitation through June 21, 2000. The court also held
that the payment authorized by telephone on April 11, 2000, further
extended the statute of limitation. Therefore, the trial court held,
Liberty's Sept. 27, 2001 complaint was timely.
The court of appeals, in an opinion authored by Judge Snyder,
affirmed. The issue was whether the telephone transaction, which was
later canceled, "constituted a payment for purposes of extending the
statute of limitations" (¶ 5). The court held "that a payment is
not conditioned on the actual transfer of funds, but on the recipient's
action of negotiating the instrument. Liberty's actions constituted
acceptance and negotiation of the amount tendered [but later blocked -
"stopped" - by the debtor]" (¶ 8). Specifically, the debtor
admitted that she authorized the $250 transaction over the telephone.
"Liberty then created a computer-generated check representing the
verbally authorized payment," deposited the check with its bank, and
entered a provisional credit (¶ 7). The debtor's subsequent
cancellation of the payment did not matter: an actual transfer from her
bank account to Liberty's account was not necessary for a "payment" to
Sale of Business - "Illusory" Contracts
Metropolitan Ventures LLC v.
GEA Assocs., 2004 WI App 189 (filed 14 Sept. 2004) (ordered
published 28 Oct. 2004)
On March 19, 2002, Metropolitan executed a Limited Partnership
Purchase Agreement (LPPA) by which it agreed to purchase GEA Associates
(GEA), a business that owned and operated a building and parking garage.
Under the LPPA, if Metropolitan did not waive the financing contingency
within 30 days after full execution of the agreement, the LPPA would
terminate. On April 17, 2002, 29 days after the execution, Metropolitan
requested an extension.
The LPPA also contained a provision that required that two-thirds of
GEA's limited partners agree to the sale. Although GEA's managing
partner recommended the sale to the other partners in a letter dated
April 29, an unsolicited and much higher offer for the business was made
on May 8. In a subsequent letter, the managing partner in effect urged
nonapproval of the purchase by Metropolitan. On May 17, GEA asserted
that the LPPA was terminated because two-thirds of the limited partners
had not agreed to the sale.
Metropolitan sued GEA. The trial court granted summary judgment in
favor of GEA on the ground that "no contract existed due to the lack of
sufficient definiteness in the financing contingency provision" (¶
The court of appeals, in a decision authored by Judge Wedemeyer,
reversed and remanded. A question of fact existed regarding whether
Metropolitan timely waived the financing contingency, but the central
issue was whether the contract itself was "illusory." "The trial court
ruled that the financing clause lacked sufficient definiteness for it to
determine the terms of financing, and therefore the entire contract was
rendered unenforceable" (¶ 14). The court of appeals rejected the
trial court's reasoning as well as the authority the trial court relied
"A business sale is distinct from a real estate sale. Specifically,
when a transaction involves the sale of a business, the contract does
not involve a fixed sale price due to the possibility that the buyer may
not acquire a 100% ownership interest. The value of the business may
also fluctuate between the time the contract is entered into and the
actual closing date. As a result, the business sale buyer is unable to
specify in the written contract the same terms and conditions as a buyer
of real estate. The business sale presents unique characteristics.
Accordingly, this court cannot rule that the cases setting forth
financing requirements in real estate sales control the outcome of this
case" (¶ 15).
The record here indicated that the "parties clearly intended to enter
into a contract. Although the financing terms were not set forth with
explicit specificity, the parties agreed to the relatively indefinite
language because this was customary practice given the distinct
characteristics of this type of sale. GEA Associates agreed to give
Metropolitan the discretion to select the lending institution and the
financing terms. In addition, the financing clause in the instant case
... set forth the percentage of the purchase price to be financed
and it set forth a practicable method in which the sale price would be
determined" (¶ 18) (footnote omitted).
Nor was it fatal that the financing clause did not specify a
particular term or rate of financing. "Because of the fluidity involved
in the sale of the business, financing terms could vary greatly over the
course of a short period of time and thus, inserting those items into
the contract would require speculation. Moreover, the specific mechanism
set forth above makes definite what the discretionary financing clause
left open. Accordingly, we reject GEA Associates' argument that the
financing clause lacks sufficient definiteness. Article II, section 2.1
a. of the LPPA demonstrates that the parties modified the general
financing contingency to provide a specific formula with which to
calculate the required terms. We cannot find any Wisconsin authority
which requires greater exactitude in a financing contingency for a
business sale than that which was employed in the LPPA" (¶ 20).
The court observed that "[i]t was not until GEA Associates received a
better offer that actions quickly turned to attempting to terminate the
contract between Metropolitan and GEA Associates. Prior to that point in
time, both parties operated as if the LPPA constituted a valid contract.
This is significant. Based on the foregoing, we conclude that any
indefiniteness in the financing clause did not render the contract void
or illusory" (¶ 22).
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Conspiracy - Multiple Counts - Multiplicity
State v. Jackson,
2004 WI App 190 (filed 16 Sept. 2004) (ordered published 28 Oct.
The defendant admitted to his role in a plan to fire bomb a police
officer's home. He and two other men conspired to fire bomb the house,
enabling two additional men to shoot people fleeing from the building.
Though the defendant was part of one conspiracy, he conspired to
participate in two acts, arson and intentional homicide, and was charged
with two counts of inchoate conspiracy under Wis. Stat. section 939.31.
A jury found the defendant guilty of both counts of conspiracy and one
count of possession of a fire bomb.
In his motion for postconviction relief, the defendant alleged that
his convictions and sentences on two counts of conspiracy violated the
double jeopardy clause of the Fifth Amendment. The circuit court denied
the motion, concluding that "there is nothing multiplicitous about
charging separate conspiracies to commit separate offenses which would
have been charged as separate crimes had they been completed" (¶
In a decision authored by Judge Dykman, the court of appeals
affirmed. It held that because the defendant conspired to commit two
crimes, he could be charged with two counts of conspiracy, one
incorporating the crime of arson and the other incorporating the crime
of murder. When the object of a conspiracy is the commission of multiple
crimes, separate charges and convictions for each intended crime are
permissible. "We conclude that the clear language of Wis. Stat. sec.
939.31 indicates legislative intent to permit multiple punishments when
conspirators agree to commit multiple crimes. We agree with the trial
court that the charges against [the defendant] were not multiplicitous"
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Eminent Domain - Partial Takings - Measuring Fair Market Value -
Comparable Sales Approach
Alsum v. Wisconsin Dep't of
Transp., 2004 WI App 196 (filed 15 Sept. 2004) (ordered
published 28 Oct. 2004)
The plaintiffs purchased a 128-acre dairy farm in 1989. In 2002 the
Wisconsin Department of Transportation (DOT) took title to 36 acres in
the center of the farm, leaving the plaintiffs with two separate and
unconnected parcels of land. Both the DOT and the plaintiffs hired
evaluation experts to appraise the land's value before and after the
taking to assist the court in its just compensation determination. The
circuit court rejected the plaintiffs' expert's use of the income
approach to measuring fair market value before and after the taking
because, in the court's view, there was evidence of comparable
In an opinion authored by Judge Anderson, the court of appeals
reversed. It concluded that the circuit court failed to provide any
reasoning for its discretionary determination that the sales offered by
the DOT were sufficiently similar to provide a basis for valuing the
Wis. Stat. section 32.09 governs the determination of just
compensation. "In a partial takings case, like the one here, the measure
of just compensation is the difference between the fair market value of
the whole property before the taking and the fair market value of the
remaining property after the taking" (¶ 12). There are three
recognized methods of measuring fair market value before and after a
taking: the comparable sales approach, the cost approach, and the income
approach. The general rule is that income evidence is never admissible
if there is evidence of comparable sales.
The circuit court stated that it found that there were comparable
sales. In the view of the appellate court, however, the circuit court
provided no reasoning for its decision. When sales are offered as
substantive evidence of property value, the other property must be
closely comparable to the property being taken. "That is, the properties
must be located near each other and sufficiently similar in relevant
market, usability, improvements and other characteristics so as to
support a finding of comparability" (¶ 18).
In this case the DOT's appraiser characterized the plaintiffs'
property as a "terminal" dairy farm, meaning that once the plaintiffs
cease farming, the land will be converted to another use. The properties
used for comparison in the DOT expert's report were dairy farms.
However, the record did not demonstrate that the farms used for
comparison were terminal dairy farms, nor did the record demonstrate
that the properties used were severed into two parcels, as the
plaintiffs' property had been. "It appears that the properties used were
all contiguous operational dairy farms. We, therefore, cannot find any
basis for the circuit court's discretionary determination that
comparable sales were available" (¶ 20).
In a footnote the appellate court reminded the circuit court that "if
[the circuit court] concludes that the [plaintiffs'] property is unique
and evidence of comparable sales is unavailable, the rule in Wisconsin
is that income evidence is admissible. This is particularly true in
cases involving farm land" (¶ 21 n.4).
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Slander - Pleadings - Reasonable Inquiry
Freer v. M&I Marshall
& Ilsley Corp.,
2004 WI App 201 (filed 21 Sept. 2004) (ordered published 28 Oct.
Freer, a former M&I Marshall & Ilsley bank employee, brought
a slander action against the bank based on statements that bank
officials made to a "potential investor," Sherman, about Freer's
investment experience while at the bank. The trial court granted summary
judgment in favor of the bank.
The court of appeals, in an opinion written by Judge Fine, affirmed.
First, Freer's summary judgment response failed to show that she
suffered any special damages. More specifically,
Freer failed to establish "pecuniary losses" resulting from the
alleged defamatory statements set forth in the complaint (¶
Second, the complaint failed to allege slander per se. Slander per se
is "`actionable without proof of damages' because damages are `presumed
from the character of the defamatory language'" (¶ 11). "It is
settled in Wisconsin that words are not slanderous per se if
anything other than the words are needed to make them defamatory"
(¶ 12). "The following statements, allegedly made by [a bank
employee] to Sherman, are not slanderous per se because they
need context outside of the words themselves to be perceived as
defamatory: that Freer was never `an investment manager'; that Freer
`was never anything other than a sales person, although she did some
marketing too'; that Freer `had never been a money manager, had never
been an investment manager'; and that Freer was never `in any type of
management position at M&I'" (¶ 13).
The court of appeals remanded the matter with instructions that the
trial court conduct an evidentiary hearing to determine whether Freer's
counsel may have violated his or her duty of "reasonable inquiry" under
Wis. Stat. section 802.05. The court of appeals was particularly
troubled by discrepancies between allegations in the complaint and the
summary judgment submissions.
Judge Lundsten concurred in remanding the case for a section 802.05
determination, but he dissented as to the defamation analysis by the
court because the analysis lacked "legal support" and conflicted with
"common sense" (¶ 28).
Recreational Immunity - "Property"
Kautz v. Ozaukee County
Agric. Soc'y, 2004 WI App 203 (filed 29 Sept. 2004) (ordered
published 28 Oct. 2004)
Two-year-old Brenna Kautz allegedly contracted an E. coli infection
while attending a county fair run by the Ozaukee County Agricultural
Society. The Kautzes alleged that the county and the agricultural
society had negligently failed to properly dispose of animal waste at
the fairground. The trial court granted summary judgment dismissing the
claims against both the county and the agricultural society under the
recreational immunity statute, Wis. Stat. section 895.52. The plaintiffs
appealed only as to the agricultural society.
The court of appeals, in an opinion written by Judge Anderson,
affirmed. The plaintiffs argued that the immunity afforded under section
895.52 was inapplicable for two reasons. "First, the Kautzes argue that
Brenna was injured when she became infected as a result of climbing on
the farm equipment and not as a result of an activity on the land or
improvements to the land. The Kautzes maintain that the term `property'
as defined in §895.52 does not include moveable equipment" (¶
11). Yet, "the injuring mechanism is not the farm equipment Brenna was
playing on, but rather, it is the bacteria from the animal waste that
was tracked onto the equipment from the Agricultural Society's real
property. If Brenna had gotten E. coli from a picnic bench or a
playhouse, it could not be said that her injury came from the bench or
the playhouse. Rather, it would be from the failure of the Agricultural
Society to properly handle the animal waste that had accumulated on the
ground" (¶ 12). Thus, Brenna's injury was directly related to the
condition or maintenance of the agricultural society's real
Second, the trial court properly found that there was no disputed
issue of fact regarding whether the Kautzes were engaged in recreational
activity at the time of the injury. "This court has repeatedly held that
attendance at community fairs, like the Ozaukee County Fair, constitutes
a recreational activity.... Further, the Kautzes concede that one of
their purposes for attending the fair was recreation - for Brenna to
have fun and enjoy the experience of a fair.... [E]ven though the
Kautzes may have had a purpose for their attendance at the fair besides
having fun and enjoying the fair offerings, this does not mean that
their attendance at the fair cannot be recreational for purposes of the
statute. As long as one of the purposes for engaging in the activity is
recreation, as it concededly was here, the statute attaches and bars
their claim" (¶ 18).
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Exclusive Remedy - Exceptions
Peterson v. Arlington
Hospitality Staffing Inc., 2004 WI App 199 (filed 22 Sept.
2004) (ordered published 28 Oct. 2004)
The plaintiff, a hotel employee, was sexually assaulted by a
coworker. She sued her employer, alleging that it knew or should have
known about the coworker's previous sexual assaults and had failed to
warn her. She later moved to amend the complaint to also allege
negligent hiring, training, and supervision. The trial court granted
summary judgment in favor of the employer on the basis of the exclusive
remedy provision of the Worker's Compensation Act (WCA) (see
Wis. Stat. § 102.03(2)).
The court of appeals, in an opinion authored by Judge Anderson,
affirmed. The sole issue on appeal was whether the court should create
an exception to the WCA's exclusive remedy provision for a claim by an
employee against an employer for negligent hiring, training, and
supervision when the injury is sexual assault committed by a coworker.
The court held that "the WCA's purpose, history and application do not
support the judicial fashioning of such an exception" (¶ 1).
Although the plaintiff offered seven policy considerations supporting
such an exception, the court concluded it was "not in a position to
write an exception into the WCA," which is the work of the legislature
(¶ 10). Indeed, every two years the Worker's Compensation Advisory
Council proposes amendments to the WCA (¶ 13). "The legislature
with its input from the experts on the advisory council and the public
is in a far better position than this court to fashion a public policy
exception to the exclusivity provision" (¶ 15).
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