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    Supreme Court Digest

    Daniel BlinkaThomas Hammer

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    Wisconsin Lawyer
    Vol. 77, No. 9, September 2004

    Supreme Court Digest


    This column summarizes all decisions of the Wisconsin Supreme Court (except those involving lawyer or judicial discipline, which are digested elsewhere in the magazine). Profs. Daniel D. Blinka and Thomas J. Hammer invite comments and questions about the digests. They can be reached at Marquette University Law School, 1103 W. Wisconsin Ave., Milwaukee, WI 53233, (414) 288-7090.

    by Prof. Daniel D. Blinka &
    Prof. Thomas J. Hammer

    * *

    Attorney Fees

    Principles for Determining Reasonableness of Attorney Fees - Fee-shifting Statutes

    Kolupar v. Wilde Pontiac Cadillac Inc., 2004 WI 112 (filed 13 July 2004)

    This case involved multiple claims, including one covered by a fee- shifting provision of Wis. Stat. chapter 218, which regulates various aspects of motor vehicle sales and financing. One of the issues on appeal was whether the circuit court properly exercised its discretion when it awarded a specific amount for attorney fees. The supreme court articulated the legal principles for courts to apply in determining whether a fee is appropriate.

    Supreme Court Rule 20:1.5 addresses reasonable attorney fees. "This rule was not drafted as a guide for courts to determine reasonable fees under fee-shifting statutes; it was designed to govern the ethical obligation of attorneys to charge reasonable fees. Nonetheless, this court has endorsed the factors set out in SCR 20:1.5 and encourages courts to apply these factors when they are required to determine or evaluate attorney fees" (¶ 24).

    The factors spelled out in Rule 20:1.5(a) are: "(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly; (2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent" (¶ 25).

    In a majority decision authored by Justice Prosser, the court recognized that when judges endeavor to determine a reasonable fee, variation is to be expected because the relevant factors can be quite subjective. Nonetheless, "[t]o the extent that discretionary decision-making can be made more uniform and transparent by providing an objective framework to assess these factors, such a framework is desirable" (¶ 27).

    The court then looked to a U.S. Supreme Court decision that refined the methodology in federal courts for awarding attorney fees under fee- shifting statutes. In Hensley v. Eckerhart, 461 U.S. 424 (1983), the Court outlined a procedure for determining the amount of a reasonable attorney fee. The procedure incorporates an objective component while utilizing the factors from Johnson v. Georgia Highway Express Inc., 488 F.2d 714 (5th Cir. 1974). [Editors' Note: The factors outlined in Johnson are similar to those articulated in Wisconsin Supreme Court Rule 20:1.5(a)].

    The Hensley Court stated: "The most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. This calculation provides an objective basis on which to make an initial estimate of the value of a lawyer's services." Hensley, 461 U.S. at 433. "The structural starting point employed by the Court appears to have been inspired by Lindy Bros. Builders, Inc. of Philadelphia v. Am. Radiator & Standard Sanitary Corp., 487 F.2d 161, 168 (3rd Cir. 1973), which commented that 'the amount thus found to constitute reasonable compensation should be the lodestar of the court's fee determination'" (¶ 28).

    "The Hensley Court explained that the product of reasonable hours multiplied by a reasonable rate - the so-called 'lodestar' figure - subsumes many of the twelve Johnson factors, but a court ought not end its analysis after arriving at that number. A court may adjust this lodestar figure up or down to account for any remaining Johnson factors not embodied in the lodestar calculation. Since Hensley, the lodestar approach has become 'the guiding light of [the Court's] fee-shifting jurisprudence'" (¶ 29).

    "Hensley's endorsement of a method to analyze the Johnson factors under an objective framework is compelling. It reinforces the circuit court's discretion to set an award within a range of reasonableness and at the same time injects the exercise of that discretion with objectivity and uniformity. These aspirations are so important and desirable that we adopt Hensley's lodestar methodology and direct the circuit courts to follow its logic when explaining how a fee award has been determined" (¶ 30).

    Chief Justice Abrahamson, joined by Justice Bradley, dissented from the majority's conclusion that the circuit court did not erroneously exercise its discretion in the award of attorney fees in this case. Justice Sykes did not participate in this case.

    Guarantees - Offers to Settle

    DeWitt Ross & Stevens S.C. v. Galaxy Gaming & Racing Ltd. P'ship, 2004 WI 92 (filed 1 July 2004)

    This case arose when a law firm sued to collect a legal bill. The law firm had entered into a written fee agreement to represent corporate clients (collectively, Galaxy) who intended to open a casino. Since Galaxy had no assets, the law firm received a guaranty from Galaxy's parent company, Southwest. Although Galaxy made periodic payments, it eventually owed more than $350,000. The law firm sued to enforce the retainer letter and the guaranty, claiming nearly $400,000 in principal and accrued interest. It also filed an offer to settle for $370,000 pursuant to Wis. Stat. section 807.01(3). The settlement offer included a "15-day payment condition."

    On summary judgment, the court ruled that the guaranty included payment of the contractual 18 percent interest, which dated back to Dec. 1, 1997, when the law firm put the clients and guarantor on notice that interest would be assessed. The judge also assessed double costs pursuant to section 807.01(3), although the judge refused to "stack" prejudgment interest of 12 percent on the contractual 18 percent interest. Finally, the judge refused to award some costs incurred in the taking of a deposition.

    The clients appealed and the law firm cross-appealed. The court of appeals affirmed in part and reversed in part. It agreed that the guarantor was liable for the 18 percent interest and that the law firm's offer to settle was valid, despite the 15-day demand. The court also agreed that the 12 percent statutory interest could not be stacked on the 18 percent contractual interest. Finally, it also found the law firm was entitled to costs for the deposition transcript.

    The supreme court, in an opinion authored by Justice Bradley, affirmed in part and reversed in part. First, the court addressed the validity of the law firm's offer to settle, which demanded payment in full within 15 days. The court held that nothing in section 807.01 or the case law construing it authorized such a condition; thus, "in strictly construing the express terms" of the statute, such a condition may not be imposed regardless of whether it may be "reasonable" in a given case (¶ 36).

    "If Wis. Stat. § 807.01 is to fulfill its purpose, litigants must have clear guidance about the proper scope of a valid offer. A clear rule will help parties draft valid offers and assess their potential exposure to costs and prejudgment interest. Moreover, it will expedite dispute settlement by minimizing the need for post-trial litigation about rejected settlement offers. We further note that Wis.Stat. § 807.01(1) and 807.01(3) provide: 'If notice of acceptance is not given, the offer cannot be given as evidence nor mentioned on the trial...'; a clear rule is therefore uniquely appropriate here because the parties may not obtain a ruling on the validity of the offer during trial" (¶ 39). In short, "the test for whether a given provision may be included in a valid settlement offer is not whether the provision is 'reasonable,' but rather whether the provision specifies a remedy that could be imposed by the court" (¶ 42).

    Second, the court held that Southwest's guaranty to make "timely and full payment of all statements" included the interest due on the client's outstanding account, even though no specific mention had been made of "interest" (¶ 43). Third, the law firm could properly claim accrued interest back to Jan. 1, 1997. The retainer letter entitled the law firm to payment upon receipt and to assess the interest retroactively (the law firm's notice was sent in November 1997).

    Finally, the law firm was entitled to all costs (for a videographer and a court reporter's transcription) for the expense of a video deposition taken in connection with this collection action. Here the written transcript was not prepared solely for counsel's convenience; rather, the written record was necessary for determining the summary judgment motion (¶ 58).

    Chief Justice Abrahamson concurred in part and dissented in part. She would have permitted the law firm to charge interest only from the date it notified the client that it would assess interest (November 1997), not retroactively (back to January 1997). Justice Crooks, joined by Justice Sykes, also dissented in part and concurred in part. They would have upheld the offer to settle and would have permitted additional interest under section 807.01. They joined the majority on all other issues.

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    Creditor/Debtor Law

    Earnings Garnishment - Service of Process - Bankruptcy Stay

    Kenosha Hosp. v. Garcia, 2004 WI 105 (filed 8 July 2004)

    Garcia owed a hospital about $20,000 for medical bills. The hospital garnished Garcia's wages and ultimately obtained a judgment against his garnishee-employer, Richter Industries, for the entire debt. The court of appeals affirmed.

    The supreme court, in an opinion authored by Chief Justice Abrahamson, reversed. The first issue concerned the proper method of serving the notice of motion for judgment against the garnishee-employer. Here the hospital had assumed that it could serve the notice of motion for judgment in accordance with Wis. Stat. section 801.14(2) (service of papers). The court held, however, that the service must comply with Wis. Stat. section 801.11(5), which governs summonses.

    "The judgment sought against Richter Industries, although arising out of an earnings garnishment proceeding that was properly commenced, is to some extent separate and distinct from the earnings garnishment action. The earnings garnishment action is designed to recover the debtor's earnings held by the garnishee. The legislature's goal in the earnings garnishment proceedings was to expedite the proceedings by providing a simplified and inexpensive means of serving a garnishee. In contrast, the purpose of a motion for judgment against the garnishee for the entire debtor's debt is to recover a judgment against the garnishee for the garnishee's violating the garnishment statutes and failing to assist the creditor in procuring the debtor's earnings to satisfy the debtor's debt. Requiring personal service of the notice of motion for judgment does not contravene the legislative goal of a simplified, expeditious procedure for earnings garnishment. Because a garnishee becomes responsible for the full amount of the debtor's debt for failing to withhold the garnished funds without a legitimate excuse, it is important that heightened statutory protections be applied to give the garnishee full notice of the financial risk it is taking by failing to appear or respond to the notice of judgment" (¶ 38).

    The record before the court failed to show that the hospital had complied with any of the methods of service under section 801.11(5). Thus, the judgment should have been vacated.

    The second principal issue in-volved whether the circuit court could enter judgment against an employer-garnishee in an earnings garnishment action when the debtor has filed a bankruptcy petition. The court held that the automatic stay provisions of 11 U.S.C. section 362(a) did not bar the judgment against the garnishee for the debtor's debt (¶ 4). The judgment was taken against the debtor's employer, not the debtor himself or his estate. To hold otherwise would mean that Wis. Stat. section 812.41 "ha[d] no teeth" (¶ 60).

    Justice Wilcox dissented from those parts of the majority opinion that addressed the service of process issue.

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    Criminal Procedure

    Judges - Calling Witnesses - Biased Judge

    State v. Carprue, 2004 WI 111 (filed 9 July 2004)

    The defendant's conviction was reversed by the court of appeals. The supreme court, in an opinion authored by Justice Prosser, reversed the court of appeals. The defendant claimed that the trial judge had surrendered her impartiality and sided with the prosecution during trial. Although the supreme court found that the judge's conduct was "inadvisable," the court held that her behavior was insufficient to warrant a reversal (¶ 3).

    The court's opinion considers a judge's authority to call and question witnesses under Wis. Stat. section 906.14. In this case the defendant did not object to the judge calling and questioning a detective. The supreme court was "disinclined to overlook the defendant's failure to timely object" for several reasons (¶ 36), including the role that objections may play in correcting a wayward trial judge. The supreme court surveyed authority, dating to 1881, that regulated the proper role for trial judges.

    The court was forced to analyze the judge's conduct in this case, however, under the rubric of ineffective assistance of counsel precisely because trial counsel had failed to object. After scrutinizing the record, the court concluded that no prejudice was demonstrated. All potentially objectionable behavior occurred outside the jury's presence, and other information was never disclosed to the jury (¶ 50).

    As to the presence of "judicial bias," the defense did little more than allege that the judge "harbored general bias in favor of the State and in criminal prosecutions based upon her actions" (¶ 60), that is, that she was "anti-defendant" (¶ 63). In short, there was no recognized ground for judicial disqualification. See Wis. Stat. § 757.19(2).

    Although the supreme court reversed the court of appeals, it stood "with the court of appeals in calling upon our circuit courts to foster an atmosphere of perfect impartiality and to strive for absolute objectivity in carrying out judicial functions" (¶ 68).

    Search and Seizure - Traffic Stops - Requesting Passengers to Exit Vehicle and Asking Them Questions Reasonably Related to Nature of Stop

    State v. Malone, 2004 WI 108 (filed 8 July 2004)

    This case was before the supreme court on certification by the court of appeals. The certified issue was whether, during a routine traffic stop, a law enforcement officer may request the passengers, as well as the driver, to exit the vehicle and then individually ask them questions reasonably related to the nature of the stop. In a unanimous opinion authored by Justice Prosser, the court said that the certified question was difficult to answer because it called upon the court to formulate a bright-line rule that police action in this regard is either always permitted or always prohibited. The court concluded that it would be unwise to attempt to fashion a single rule purporting to encompass the innumerable variations of a routine traffic stop.

    On the facts of this case the court held that the officer acted reasonably. The encounter started out as a traffic stop for speeding. During the course of the stop the defendant (a passenger in the vehicle) was asked to exit the vehicle and to answer four questions unrelated to the scope of the initial stop. However, before the defendant was asked to exit, the officer had become aware of specific and articulable facts giving rise to the reasonable suspicion that criminal activity involving narcotics might be afoot. Therefore, the court held, the officer was justified in briefly detaining and questioning the defendant regarding that suspicion.

    With regard to the duration of the stop, the court understood the defense to argue that any extension of the original traffic stop was unjustified. A reasonable seizure can become an unreasonable seizure if questioning extends the stop beyond the time necessary to fulfill the purpose of the stop. However, in this case, the court concluded that the purpose was transformed as the officer became aware of additional information that justified expanding his investigation to pursue his reasonable suspicion that the occupants of the vehicle might be committing or about to commit a crime involving narcotics. Thus, the officer had a new purpose, that is, to investigate his suspicion regarding criminal activity.

    The officer's lawful authority to pursue his suspicion of criminal activity did not mean that the stop could last indefinitely. But the defendant "fail[ed] to present an alternative argument regarding the permissible length of the detention if we were to find that [the officer] was justified in pursuing his suspicion of criminal activity in a reasonable manner. Because [the defendant] does not address this issue, neither do we" (¶ 46).

    Accordingly, the court affirmed the decision of the circuit judge denying the defendant's motion to suppress physical evidence that was obtained during the course of the extended stop and subsequent to the questioning as described above.

    Plea Agreements - Collateral Attack on Plea-negotiated Convictions

    State v. Deilke, 2004 WI 104 (filed 8 July 2004)

    The defendant was charged in 2001 with OWI (fifth offense). His repeat offender status was based on four prior OWI convictions, including ones in 1993, 1994, and 2000. In those earlier cases plea agreements were implemented that resulted in dismissal of additional charges, including prohibited alcohol concentration (PAC) charges. When the defendant was charged with his fifth OWI offense, he filed a motion collaterally attacking his earlier OWI convictions, claiming that the plea colloquies in those cases did not show that he had validly waived his right to counsel. The state agreed that no valid waiver had occurred and the circuit court accordingly granted the defendant's motion. The result of this successful attack on the prior convictions was that they were no longer available for use as penalty enhancers in the new 2001 case or in any OWI cases that might be brought in the future.

    The state moved to vacate the plea agreements in the earlier cases and to reinstate the dismissed PAC charges, arguing that the defendant breached the plea agreements in those cases by his successful collateral attack on the resulting convictions. The circuit court granted the motion for the 1993 and 2000 cases (with a different judge denying the motion for the 1994 case) and the defendant, with the advice of counsel, pleaded no contest to the 1993 and 2000 PAC counts. The state requested no additional punishment. The court of appeals reversed.

    In a majority decision authored by Justice Roggensack, the supreme court reversed the court of appeals. It held that the defendant's successful collateral challenge to his earlier convictions constituted a material and substantial breach of the plea agreements on which the convictions were based. It also agreed with the circuit court that the appropriate remedy for the breach was to vacate the plea agreements and reinstate the original charges as requested by the state and to accept the defendant's subsequent no contest pleas to those charges.

    The defendant argued that because he did not move to withdraw his pleas but merely attacked the convictions due to the lack of a valid waiver of counsel, the convictions were not invalidated; they simply could not be used for purposes of sentence enhancement. The court disagreed. "[The defendant] cites no authority for the novel idea that a conviction obtained through an unrepresented defendant's plea, made without a valid waiver of counsel, can stand, yet its effect cannot... We conclude that the result of [the defendant's] successful collateral attack on the convictions was to invalidate the convictions" (¶ 17).

    Among the other arguments advanced by the defendant was a claim that the 1993 PAC charge was time-barred because the three-year statute of limitation for misdemeanors had run. The supreme court concluded that the defendant did not have a statute of limitation defense to that charge. "[W]e conclude that the circuit court was correct in rescinding the plea agreements so that the parties were in the same posture as they had [been] prior to [the defendant's] pleas, when the statute of limitations was not implicated" (¶ 30).

    Justice Bradley filed a dissenting opinion that was joined by Chief Justice Abrahamson. Justice Sykes did not participate in this case.

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    Evidence

    Witnesses - Impeachment

    State v. Johnson, 2004 WI 94 (filed 1 July 2004)

    The supreme court, in an opinion authored by Justice Roggensack, held that there is no conflict between the line of cases headed by State v. Haseltine, 120 Wis. 2d 92 (Ct. App. 1984) and the line of cases headed by State v. Jackson, 187 Wis. 2d 431 (Ct. App. 1995).

    "In the Haseltine line, the objected to testimony is simply bolstering another witness's testimony of an event about which the expert witness has no personal knowledge. It is generally done on direct examination and usurps the jury's role as the 'lie detector in the courtroom.' The jury can independently determine the credibility of each witness and does not require an expert witness to assist it with that determination" (¶ 19) (citations omitted).

    "By contrast, in the Jackson line of cases, two witnesses are testifying about an event that both claim to have seen, and their testimony conflicts. The purpose and effect of the cross-examination of the second witness is to test that witness's credibility through his or her demeanor and answers to questions. It aids the jury in its truth-finding function. See Wis. Stat. § 906.07 (2001-02) (stating the credibility of any witness may be attacked by any party). The testimony elicited by the prosecutor [in Jackson] was not placed before the jury to bolster the credibility of the other witnesses. Instead, cross-examination was used to highlight the inconsistencies in the testimony, and give the witness an opportunity to explain those inconsistencies" (¶ 20) (footnotes and citations omitted). The record in this case revealed nothing improper in the prosecutor's attempt to impeach the defendant's credibility.

    Justice Bradley, joined by Chief Justice Abrahamson, concurred. Although agreeing that defense counsel had not been "ineffective," the concurring justices "fear[ed]" that the majority had "opened the door to a line of questioning" that had no probative value, invaded the jury's province, and was misleading. The line involves asking one witness whether another witness is "lying." Justice Sykes did not participate in this case.

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    Insurance

    UIM - Bodily Injury

    State Farm Mut. Auto. Ins. Co. v. Langridge, 2004 WI 113 (filed 13 July 2004)

    The plaintiff's husband was killed by a drunk driver. After receiving the liability limits from the tortfeasor's insurer, the plaintiff made a claim for $100,000 in underinsured motorist (UIM) coverage from her own insurer, State Farm. The insurer denied the claim because the plaintiff was not involved in the accident and suffered no bodily injury herself. The circuit court granted summary judgment in favor of the insurer and the court of appeals affirmed.

    In an opinion authored by Justice Prosser, the supreme court affirmed. UIM coverage varies according to the policy language. Some policies define UIM status by comparing the insured's damages to the tortfeasor's liability coverage (¶ 20). In contrast, some other policies compare the tortfeasor's liability limits to the insured's limits of UIM coverage (¶ 21). The policy in question took the second approach.

    The issue in this case was whether the term "the insured" referred to the wife as well as her deceased husband. (Since he carried just $100,000 in UIM coverage and the tortfeasor carried $150,000 in liability coverage, the tortfeasor was not underinsured as to the deceased.) The court held that "the insured" did not refer to the wife.

    "In this case, an insured who suffered no bodily injury seeks to recover for her spouse's wrongful death after the tortfeasor's 'limits of liability for bodily injury' had been fully paid. If we were to accept Nancy Langridge's reading of the policy, then every time a wife and husband were both insured under the same UIM coverage, the surviving spouse would always be able to assert per person UIM coverage unless the tortfeasor's policy limits exceeded the amount paid to the estate. To illustrate, if the drunk driver who killed Nancy Langridge's husband had $500,000 per person liability limits, and that entire amount was paid to William Langridge's estate, Nancy Langridge would be able to make the same argument she is making now. Payment to an estate would never eliminate a wrongful death claim under paragraph 'b' unless the tortfeasor did not pay out its limits of liability and had, say, $100,000 left. Mrs. Langridge's reading of the policy essentially transforms UIM into a form of life insurance for a spouse killed in an automobile accident. This is not consistent with a reasonable insured's understanding of the UIM policy" (¶ 51).

    Justice Bradley, joined by Chief Justice Abrahamson, dissented. The dissenters concluded that the policy language was ambiguous and the wife's construction was reasonable.

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    Limitations on Actions

    Wisconsin Borrowing Statute - Statutes of Repose

    Wenke v. Gehl Co., 2004 WI 103 (filed 7 July 2004)

    The plaintiff was severely injured in Iowa in 1997 while using a baler manufactured by defendant Gehl Co., a Wisconsin corporation. Gehl had sold the baler to another Iowa resident in 1981, and the baler was subsequently acquired by the plaintiff. An Iowa statute limiting product liability actions from being commenced more than 15 years after a product "was first purchased" precluded the plaintiff from bringing an action in Iowa to recover for his injuries. Hence, in 1999 the plaintiff brought an action in Wisconsin. Gehl asserted that the statute barring the action in Iowa must be borrowed and applied under Wis. Stat. section 893.07(1) to bar the action in Wisconsin.

    Section 893.07(1) provides that "[i]f an action is brought in this state on a foreign cause of action and the foreign period of limitation which applies has expired, no action may be maintained in this state." The core issue before the court was whether the term "foreign period of limitation" includes foreign statutes of repose like the Iowa provision referred to above. [A statute of repose bars a suit a fixed number of years after an action, for example, manufacturing a product, by the defendant, even if this period ends before the plaintiff suffers any injury.]

    In a majority decision authored by Justice Prosser, the supreme court concluded that the phrase "period of limitation" in section 893.07 pertains equally to foreign statutes of limitation and foreign statutes of repose. The legislature did not distinguish between these different types of limitation periods when enacting section 893.07. Accordingly, the plaintiff's action to recover damages for injuries sustained in Iowa is barred in Wisconsin and was properly dismissed by the circuit court.

    The court overruled that portion of Leverence v. United States Fidelity & Guaranty, 158 Wis. 2d 64, 462 N.W.2d 218 (Ct. App. 1990) that concluded that a foreign statute of repose was not a foreign "period of limitation" within the meaning of section 893.07.

    Lastly, the court rejected the plaintiff's argument that the ruling in this case should only be given prospective application. "Because we have not been presented adequate grounds for applying our ruling prospectively, and because we presume retroactivity, our ruling today applies to [the plaintiff]" (¶ 75).

    Justice Crooks filed a concurring opinion that was joined by Justice Wilcox. Justice Bradley filed a dissenting opinion that was joined by Chief Justice Abrahamson.

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    Sexually Violent Persons

    Supervised Release - Revocation

    State v. Burris, 2004 WI 91 (filed 30 June 2004)

    Burris was adjudicated a sexually violent person and committed under provisions of Wis. Stat. chapter 980. The court ordered that Burris be placed in a supervised release program. State officials later moved to revoke Burris's supervised release because he had allegedly violated its terms. After a hearing, the court granted the state's motion. The court of appeals affirmed.

    The supreme court, in a decision authored by Justice Prosser, affirmed the court of appeals. The "principal issue" was "whether a circuit court is required to expressly consider alternatives to revocation before revoking a sexually violent person's supervised release when the court makes a determination that 'the safety of the public requires [the person's] commitment to a secure facility.'" Burris also contended that "his revocation proceeding was 'arbitrary and unfair' because it violated basic due process safeguards and that his revocation was not supported by the evidence" (¶ 1).

    The court held that "a circuit court is not required to expressly consider alternatives to revocation before revoking a sexually violent person's supervised release when the court determines that the safety of the public requires the person's commitment to a secure facility. Such a finding mirrors a finding that 'the safety of others requires that supervised release be revoked'" (¶ 2).

    Said the court, "[w]e think it is self-evident, however, that when the court determines, on the evidence after a hearing, that 'the safety of others requires that supervised release be revoked,' the court has found that there is clear and convincing evidence that it has no alternative but to revoke to assure the safety of others. Put another way, the court has found that the safety of others requires the person's commitment to a secure facility because supervised release will not be adequate" (¶ 40). The court also held that the proceedings in this matter were neither arbitrary nor fundamentally unfair (¶ 2).

    Justice Crooks, joined by Justice Bradley, concurred because the majority opinion did not go quite far enough. They would have required that "in a situation where the basis for the revocation of a sexually violent person's supervised release is a rules violation, rather than a determination based on public safety, a court must consider alternatives to revocation on the record" (¶ 76).

    Chief Justice Abrahamson dissented because the state had failed to prove grounds for the revocation by clear and convincing evidence and because the majority opinion erroneously and "summarily" concluded that the proceedings were not arbitrary or fundamentally unfair.

    Interviews - Miranda Rights

    State v. Lombard, 2004 WI 95 (filed 1 July 2004)

    Lombard was convicted of a series of violent sexual assaults in the late 1970s. The state later commenced a Wis. Stat. chapter 980 action, as a result of which Lombard was adjudicated a sexually violent person in need of supervision or commitment.

    The supreme court, in an opinion written by Justice Crooks, affirmed the court of appeals. The supreme court's opinion addressed whether Lombard should have been advised of his Miranda rights "prior to being interviewed by a State evaluator in regard to whether a ch. 980 petition should be filed" (¶ 16). The court concluded that neither chapter 980 nor the constitution mandates that such warnings be given.

    Building upon the reasoning in several court of appeals decisions, the court held: "Here, Lombard was already convicted for the underlying sexual assault offenses that led to his ch. 980 commitment as a sexually violent person. Thus, any statements Lombard made to Jurek regarding those assaults could not be used against him in future prosecutions. We agree with the court of appeals in this case that '(t)he purpose of the examiner's interview was to evaluate Lombard for the purpose of a potential civil commitment proceeding, not a criminal proceeding, and the examiner was not required to comply with Miranda's dictates'" (¶ 42). And for this reason, Lombard's claim of ineffective assistance of counsel also failed.

    Chief Justice Abrahamson, joined by Justice Bradley, dissented on the ground that "ch. 980 individuals are entitled to be advised at the pre-petition examination (1) that they have the right to remain silent, and (2) that their silence will not be used against them at any stage of the ch. 980 commitment proceeding" (¶ 53). Justice Sykes did not participate in this case.

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    Torts

    Products Liability - Components - "Substantial Change"

    Haase v. Badger Mining Corp., 2004 WI 97 (filed 2 July 2004)

    Haase was diagnosed with silicosis, a lung disease caused by his inhalation of silica particles at a foundry where he had worked since 1955. He sued a number of defendants, including Badger Mining, which supplied the silica sand used at the foundry. At the close of the plaintiff's case-in-chief, the trial court dismissed the claims against Badger based on the insufficiency of the evidence. The court of appeals affirmed.

    The supreme court, in an opinion authored by Justice Bradley, affirmed the court of appeals. The case presented two issues. First, the trial court erred when it adopted and applied the Restatement (Third) of Torts, § 5 (1998), which concerns the liability of commercial sellers or distributors of product components. Section 5 was not applicable because, quite simply, "Badger's silica sand was not a component because it was not integrated into [the foundry's] finished products" (¶ 21). Nor did the sand cause the end product (metal castings) to be defective. "Rather, it was the sand itself that was allegedly defective" (¶ 22).

    The supreme court affirmed the court of appeals, however, based on its analysis of the second issue, the plaintiff's failure to produce sufficient evidence for a strict liability claim under the Restatement (Second) of Torts § 402A (1965). The fifth element of section 402A requires proof that "the product was one which the seller expected to and did reach the user or consumer without substantial change in the condition it was when he sold it" (¶ 25). Although Haase alleged that Badger's product did not undergo substantial change - the amount of silica in the sand remained constant - "the evidence reveals that the very characteristic which made Badger's silica sand dangerous, its respirability, did not arise until the sand had been fractured into dust . . . during the foundry process. (¶ 32). [The court reiterated that "foreseeability" is not an element considered in strict liability claims under Wisconsin law.]

    Misrepresentation - Economic Loss Doctrine - Commercial Real Estate

    Van Lare v. Vogt Inc., 2004 WI 110 (filed 9 July 2004)

    The plaintiffs purchased a gravel pit from the defendant in 1993. The purchase agreement contained an "as is" clause, and both sides had lawyers. The plaintiffs were aware that "illegal dumping" had occurred prior to the purchase. Although the plaintiffs used the property to excavate gravel, they eventually sought to use the property for a residential development. Before the statute of limitation expired, the plaintiffs filed this action for damages connected with the dumped debris found on the property. At trial, the plaintiffs submitted only a strict liability claim (for misrepresentation) and the jury awarded damages of nearly $400,000. On post-verdict motions, the trial judge granted the defendant's motion to dismiss, on the ground that the strict liability misrepresentation claim was barred by the economic loss doctrine. The court of appeals certified this case to the supreme court.

    The supreme court, in an opinion written by Justice Prosser, affirmed the circuit court. "The threshold issue in this case is whether the economic loss doctrine applies to commercial real estate contracts such as the Option to Purchase and resulting purchase agreement in this case" (¶ 16). Although the economic loss doctrine was developed in cases involving defective products, courts also have applied it to transactions involving real estate. "In this case, we have a written, bargained-for contract for the sale of commercial-use land between two sophisticated parties represented by counsel during the negotiation process. This is the kind of situation that is tailor made for the application of traditional contract law" (¶ 21).

    The court also declined to fashion a "fraud in the inducement" exception for claims involving strict liability misrepresentation, which differ significantly from those involving intentional misrepresentation (¶ 31). Nor was a new trial warranted in the interest of justice.

    Justice Bradley concurred but wrote separately to "forestall revision ist interpretations" of Digicorp Inc. v. Ameritech Corp., 2003 WI 54, which addressed the exception to the economic loss doctrine.

    Justice Crooks, joined by Justice Wilcox, also concurred and wrote to emphasize that "the Digicorp majority clearly rejected a broad fraud in the inducement exception to the economic loss doctrine" (¶ 47).

    Medical Malpractice - Wrongful Death - Noneconomic Damages Caps

    Maurin v. Hall, 2004 WI 100 (filed 2 July 2004)

    This medical malpractice case arose when a five-year-old child died of a misdiagnosed diabetic shock. Her parents brought this action for wrongful death and medical negligence. The jury awarded damages to the parents. In post-verdict motions, the circuit court held that the Wis. Stat. section 895.04(4) wrongful death damages cap was unconstitutional.

    The court of appeals certified two issues to the supreme court. "First, may the plaintiffs in a medical malpractice action, where there is a death caused by medical negligence, recover the limit on noneconomic damages for both medical negligence and wrongful death? Second, is the limit on noneconomic damages in a medical malpractice wrongful death case constitutional?" (¶¶ 3-4).

    The supreme court, in an opinion written by Justice Prosser, reversed the judgment. The court held "that the purpose and effect of Wis. Stat. § 893.55(4)(f) was to limit the noneconomic damages recoverable against health care providers for wrongful death in medical malpractice cases to the dollar amount listed in Wis. Stat. § 895.04(4). The limit in the latter statute supersedes the limit in Wis. Stat. § 893.55(4)(d) that would have applied but for the shift to a different limit" (¶ 88).

    The majority opinion concluded that legislation in 1995 combined "the noneconomic damages from medical malpractice and the loss of society and companionship damages from wrongful death at a relatively modest level of $150,000" (¶ 89). When the legislature later raised the caps on noneconomic damages, it responded to case law that had entitled each claimant to the capped amount by inserting the words "per occurrence" in section 895.04(4) (¶89).

    Second, the court also held that the damages cap was constitutional. The majority rejected attacks rooted in the right to trial by jury, separation of powers, equal protection, and substantive due process.

    Chief Justice Abrahamson and Justice Crooks concurred, but criticized the majority for interpreting the statutes in a way not advocated by either party. They contended that both parties should submit new briefs and address the majority's "novel" interpretation in a reargument (¶ 120). Among many points, the concurrence charged the majority with failing to "recognize the simple yet well established distinction between a survival action and an action for wrongful death" (¶ 129).

    Justice Wilcox, joined by Justices Prosser and Sykes, concurred and joined the majority in all respects but wrote separately to address a remittitur issue discussed in the preceding concurrence.

    Justice Bradley, also concurring, wrote separately to stress that the "constitutionality of Wis. Stat. § 895.04(4) is jeopardized by the extreme interpretation advanced by the majority" (¶ 250).

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    Landowner - Dogbite - Negligence

    Smaxwell v. Bayard, 2004 WI 101 (filed July 2004)

    A young child was seriously injured when three large, vicious dogs attacked her. The dogs' owner rented the property from Thompson. The attack occurred while the child was visiting Thompson, who is the child's grandmother. The plaintiffs sued Thompson (and others), but the trial court granted summary judgment dismissing the claim against Thompson. Affirming, the court of appeals held that only an owner or keeper of the animal, not a landlord on whose property the animal is kept, may be found negligent.

    In a decision authored by Justice Wilcox, the supreme court affirmed. The court analyzed three intersecting areas of law: "landowner liability for injuries occurring on the property, landlord premises liability, and liability for the acts of known dangerous dogs" (¶ 13). Clearly, Thompson, "as a landowner, owed a general duty to exercise ordinary care to all those who legally came upon her property" (¶ 35).

    The court found it unnecessary to decide "whether a dangerous dog may constitute a 'defect' in the rental premises or whether a landlord's duty of ordinary care extends beyond defects in or maintenance of the physical premises because we ultimately conclude, on public policy grounds, that common-law liability of landowners and landlords for negligence associated with injuries caused by dogs is limited to situations where the landowner or landlord is also the owner or keeper of the dog causing injury. That is, for the purposes of this decision, we assume that Thompson's conduct constituted actionable negligence either in her capacity as a landowner in general or landlord in particular" (¶ 39). In its public policy analysis, the court concluded that imposing liability on a landlord or landowner who is not the animal's owner or keeper would enter an area with no sensible or just stopping point (¶ 47).

    Justice Bradley, joined by Chief Justice Abrahamson, dissented on the ground that Thompson's own negligent conduct created liability on these facts independent of the acts of her tenant. Thompson allegedly knew about the dogs' dangerous propensities and that they sometimes ran at large on the property.

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