Wisconsin Lawyer
Vol. 79, No. 9, September 2006

Supreme Court Digest

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

Administrative Law Civil Procedure Contracts Counties Criminal Law Criminal Procedure Family Law

Insurance Property Remedies Taxation Torts Trade Secrets Law Tribal Gaming

Administrative Law

All Star Rent A Car Inc. v. Wisconsin Dep't of Transp., 2006 WI 85 (filed 6 July 2006)

All Star Rent a Car Inc. is a licensed motor vehicle dealer that purchases damaged cars and sells them after making repairs. The Wisconsin Department of Transportation (DOT), which is responsible for licensing motor vehicle dealers, filed a complaint with the Division of Hearings and Appeals (DHA) to revoke All Star's license. It also denied All Star's application for renewal of its license. All Star filed a request with the DHA for a hearing to review the license denial. The DHA combined the revocation proceeding and the nonrenewal proceeding for a contested case hearing. Ultimately, the DHA administrator issued an order that affirmed the denial of All Star's license renewal and revoked its motor vehicle license. Attached to the DHA's final decision was a notice of All Star's right to judicial review of its decision. The notice specified that "[a]ny petition for judicial review shall name the Division of Hearings and Appeals as the respondent" (see ¶ 6).

All Star petitioned the Dane County Circuit Court for judicial review of the DHA's decision pursuant to Wis. Stat. section 227.52. In its petition, All Star named the DOT as the respondent, and it served the petition on the DOT and the Wisconsin Attorney General. All Star did not name or serve the DHA. The circuit court dismissed All Star's petition because All Star failed to name and serve the DHA as the respondent, which the court concluded was required by Wis. Stat. section 227.53(1)(b).

The court of appeals reversed. It concluded that the relevant statutes were ambiguous in prescribing which administrative entity All Star was required to serve and, as a result, All Star's action in naming and serving the DOT, but not the DHA, was reasonable under the circumstances. See 2004 WI App 198.

In a majority decision authored by Justice Prosser, the supreme court reversed the court of appeals. Said the court, "We agree with the court of appeals that the relevant statutes are ambiguous. We also recognize that All Star was required to serve DOT as a party under Wis. Stat. § 227.53(1)(c). Nevertheless, we conclude that All Star's failure to follow the instructions in the `Notice' of review rights appended to DHA's written decision - instructions that directed All Star to name DHA as respondent in a notice that clarified the confusing statutes - was not reasonable" (¶ 1). "When an agency appends a notice to its decision and the notice clearly directs a party how to appeal, the notice should remove any confusion created by the statutes about whom to name and serve" (¶ 47). The supreme court held that because it was not reasonable for All Star to ignore the directive in the notice to name and serve the DHA as respondent, the circuit court properly determined that it lacked competency to hear All Star's petition (see ¶ 52).

Justice Roggensack filed a dissenting opinion that was joined by Justice Butler.

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Civil Procedure

Lassa v. Rongstad, 2006 WI 105 (filed 13 July 2006)

Julie Lassa was a candidate for elective office. She sued Todd Rongstad and others based on a political mailer that criticized her. Rongstad appealed a judgment that adopted the parties' settlement agreement, under which Lassa dismissed her claims and Rongstad agreed to pay $65,000 in attorney fees and forfeitures as sanctions for failing to comply with discovery orders. Rongstad had refused to disclose certain information demanded during discovery on grounds of privilege (constitutional and evidentiary).

In an opinion authored by Justice Bradley, the supreme court affirmed the circuit court. There are four parts to the court's decision, which the court summarized as follows: 1) "In defamation cases, circuit courts should ordinarily decide a pending motion to dismiss for failure to state a claim before sanctioning a party for refusing to disclose information that would identify otherwise-anonymous members of an organization. Under the circumstances here, however, the circuit court did not erroneously exercise its discretion in compelling discovery and imposing sanctions before deciding Rongstad's motion to dismiss" (¶ 5).

2) "The circuit court properly rejected Rongstad's assertion of privilege under the balancing test of the NAACP line of cases because Rongstad failed to make the required preliminary factual showing to support his assertion" (id.). 3) Rongstad failed to demonstrate the applicability of the expert witness privilege recognized by Burnett v. Alt, 224 Wis. 2d 72, 589 N.W.2d 21 (1999) (see id.).

4) "We reject Rongstad's challenge to the severity of the $65,000 in attorney's fees and forfeitures because the circuit court did not set that amount - the parties did by stipulation. Rongstad cannot claim that the amount of $65,000 has no rational relationship to the harm suffered or that the court erroneously exercised its discretion in setting the amount. Rather, the issue of the amount of monetary sanctions was pending before the court when the parties stipulated to $65,000. We also determine that Rongstad's challenge to the sanction of a default judgment on liability is moot under the parties' settlement agreement" (id.).

Finally, the court declined "to exercise [its] superintending authority to establish an interlocutory appeal as a matter of right in defamation cases involving discovery sanctions that raise questions of a constitutional privilege" (¶ 91).

Justice Butler concurred on most issues (see ¶ 95), but concluded that because the circuit court dismissed the defamation claim with prejudice, the supreme court lacked jurisdiction to "consider the merits of Lassa's defamation claim, and Rongstad's assertion of any privilege with respect to that claim, including whether the circuit court properly imposed sanctions for a violation of pretrial discovery orders" (¶ 96).

Justice Prosser dissented on the ground that this was a "SLAPP suit masquerading as a defamation case"(¶ 108), which chilled First Amendment rights.

Justices Wilcox, Crooks, and Roggensack did not participate.

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Contracts

1325 North Van Buren LLC v. T-3 Group Ltd., 2006 WI 94 (filed 11 July 2006)

1325 North Van Buren LLC and T-3 Group Ltd. entered into a 100-page comprehensive contract under which T-3 agreed to renovate into a condominium complex an industrial warehouse owned by 1325. The work was not completed on time, and 1325 then declared T-3 in default and claimed millions of dollars in damages. T-3 carried commercial general liability (CGL) coverage through Indiana Insurance Co. and professional liability coverage through another insurer, Westport. Because T-3 ceased doing business, 1325's only recovery was through the insurance policies. The circuit court dismissed 1325's tort claims against T-3 based on the economic loss doctrine and ruled that neither the CGL nor the professional liability policy covered 1325's contract claims. The court of appeals reversed on all grounds.

The supreme court, in an opinion written by Justice Wilcox, reversed in part and affirmed in part. First, the court held that the economic loss doctrine applied to the contract, which the court had "little difficulty" concluding was a "mixed contract" that included both services and products (see ¶¶ 32, 36). Next, the court held that the mixed contract was predominantly for goods (i.e., a "product," the condominium complex). The court said that this followed from the contract's plain language, the pricing, the bidding process, and the parties' understanding (see ¶¶ 46-49). "In sum, applying [case law] analysis, we conclude the predominant purpose of the T-3/1325 contract was to provide a condominium complex rather than to provide construction management services; therefore, the contract is subject to the economic loss doctrine as 1325 has suffered solely economic losses" (¶ 50).

Second, the supreme court affirmed the court of appeals' conclusion that Westport's policy covered the claimed damages and that the insurer had a duty to defend. "We agree with 1325 and conclude that Westport's professional liability policy provides coverage for 1325's breach of contract claim against T-3. 1325's claim clearly fits within the insuring agreement as it is based on a `negligent act, error or omission' of T-3 in its failure to adhere to professional standards, sounding in negligence, but arising in the context of a contract between 1325 and T-3. The policy is in no way limited to negligence claims. A breach of contract claim, as pled in 1325's amended complaint, can also arise from negligent acts, errors or omissions" (¶ 57). The supreme court emphasized that it has "repeatedly rejected the argument that insurance coverage is dependent upon the theory of liability" (¶ 58).

Justice Bradley, joined by Chief Justice Abrahamson and Justice Butler, dissented on the ground that the economic loss doctrine had "swollen" beyond principle and was "devour[ing] unsuspecting tort claims" in its path (¶ 69).

Wisconsin Mall Props. v. Younkers Inc., 2006 WI 95 (filed 11 July 2006)

A city condemned property owned by Wisconsin Mall, which in turn had leased the property to Saks and others (Saks). This case involves the interplay of condemnation law and contract law. The circuit court granted summary judgment "on the theory that the existence of the condemnation proceedings precluded Wisconsin Mall from seeking contract remedies against Saks" (¶ 5). The court of appeals affirmed.

The supreme court, in an opinion written by Justice Bradley, reversed. "Wisconsin Mall concedes that it is not entitled to a double recovery. In other words, all agree that Wisconsin Mall cannot recover for the same damages in both its contract action against Saks and the condemnation proceedings involving the City. Rather, the dispute in this case centers on whether Wisconsin Mall's only remedies for the damages it seeks must be had in the condemnation proceedings or whether Wisconsin Mall may seek a remedy against Saks via the contract action that is now before us" (¶ 20).

"Saks and the City argue that Wisconsin Mall has no rights under the lease as a result of the condemnation. This argument is largely based on an assertion that the City exercised its eminent domain power to condemn not only the property but also the lease. According to Saks and the City, it is as if Wisconsin Mall assigned the lease to the City such that the City stepped into Wisconsin Mall's shoes. Further, Saks and the City argue that even if Saks breached the lease, the damages for that breach must be had in the condemnation proceedings as part of Wisconsin Mall's just compensation for the lease" (¶ 22).

The court began "from the premise that at least some contract claims relating to condemned property may be maintained apart from and despite any related condemnation proceedings" (¶ 23). "The question thus becomes whether Wisconsin Mall's contract claim against Saks may be maintained apart from and despite the pending condemnation proceedings that relate to the Green Bay store property" (¶ 24). Two "general rules" governed the analysis: "(1) complete condemnation of a property terminates a lease attached to that property; and (2) the parties to a lease may contract for their rights and obligations in the event of condemnation" (¶ 26).

The general rules begat three further "observations." "First, it is not correct to assume that the condemnation here operated as an assignment of the lease, placing the City directly into the shoes of Wisconsin Mall as the lessor under the lease. Rather, the condemnation of Wisconsin Mall's property terminated the lease, except to the extent that the parties agreed otherwise with respect to their rights and obligations in the event of a condemnation. Second, it is also not correct to assume, as do Saks and the City, that Wisconsin Mall is necessarily precluded from enforcing against Saks any right that arose under the lease" (¶ 31).

Third, "Wisconsin Mall's contract claim against Saks appears primarily based on an alleged breach of the lease that occurred before its property was condemned. The primary breach that Wisconsin Mall alleges is of section 5.1(c) of the lease. Specifically, Wisconsin Mall asserts that Saks took actions to avoid the lease by colluding with the City to effectuate a condemnation that would allow Saks to escape its obligations to Wisconsin Mall under the lease" (¶ 34). (The lease contained express provisions that governed in the event of condemnation (see ¶ 35).) The court said that remand was necessary because "whether Wisconsin Mall may seek a remedy against Saks for a breach of the lease depends on the terms of the lease as interpreted and applied to the facts of this case" (¶ 44).

Counties

Jackson County v. Wisconsin Dep't of Natural Resources, 2006 WI 96 (filed 11 July 2006)

Jackson County Sanitary Landfill Inc. (JCSL) owned and operated a landfill in Jackson County. JCSL was licensed by the Department of Natural Resources (DNR) to operate a solid waste facility. In 1998 JCSL stopped paying real estate taxes on the property that contains the landfill. In June 2000, the landfill reached its authorized capacity and JCSL began closing the landfill. The county pursued tax delinquency proceedings against JCSL by issuing a tax certificate for unpaid taxes on the property. Because JCSL continued in its nonpayment of real estate taxes and did not redeem the tax certificate, in 2002 the county clerk issued a tax deed to the county. The county accepted the tax deed and then recorded and re-recorded it.

In 2003, the county's board of supervisors resolved to rescind the tax deed after determining that the responsibilities associated with the landfill could place a financial burden on the county. However, JCSL claimed that the county now owned the landfill and was responsible for its care and maintenance and any subsequent liability. The county then filed a declaratory judgment action in the Dane County Circuit Court. It alleged that it is inequitable to permit JCSL to escape its obligations for the landfill by refusing to pay taxes.

The circuit court granted summary judgment to the defendants, and the county appealed. The court of appeals certified the issue of whether "a county, after taking a tax deed to assume ownership of property on which taxes had not been paid, may rescind the tax deed and return the property to the original owner, without that owner's consent" (¶ 9). The supreme court granted certification.

In a majority decision authored by Justice Roggensack, the supreme court concluded that Jackson County lawfully issued the tax deed. "We also conclude that when the County accepted the tax deed, all property rights vested in fee simple in the County. Because the County has no statutory authority to rescind a tax deed that was lawfully issued and thereby unilaterally impose property ownership on a third party, its attempted rescission has no effect on ownership of the property containing the landfill" (¶ 1).

Chief Justice Abrahamson filed an opinion concurring in part and dissenting in part. Justice Prosser filed a dissenting opinion.

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Criminal Law

State v. Bonds, 2006 WI 83 (filed 30 June 2006)

The defendant was charged with misdemeanor battery. He was alleged in the criminal complaint to be a habitual criminal under Wis. Stat. section 939.62 by virtue of three prior misdemeanor convictions. He pleaded not guilty but was convicted by a jury. At sentencing, he did not admit the allegation of habitual criminality. The state then changed the factual basis for its allegation that the defendant was a repeater and sought to prove a prior felony forgery conviction. The state submitted a Consolidated Court Automation Programs (CCAP) report as proof of that conviction. (CCAP is a case management system provided by the Wisconsin Circuit Court Access program. It provides the public with online access to reports of activity in the circuit courts of Wisconsin counties that use CCAP.) The defendant objected to amending the basis on which the state sought to prove habitual criminality and also asserted that the proof the state had submitted was insufficient to prove habitual criminality beyond a reasonable doubt. The circuit court permitted the amendment, accepted the CCAP report as sufficient proof of habitual criminality, and sentenced the defendant as a repeater. The court of appeals affirmed.

In a split decision the supreme court reversed the court of appeals. A four-member majority of the court (Justices Wilcox, Crooks, Prosser, and Roggensack) concluded that "with sufficient proof, the State's post-conviction amendment of the basis for proving habitual criminality would have been permissible for two reasons: (1) The complaint satisfied the requirements of Wis. Stat. § 973.12 [the statute setting forth the requirements for alleging and applying the habitual criminality penalty enhancer] and of due process because [the defendant] had notice that he was being charged as an habitual criminal and of the potential maximum sentence he faced before he pled; and (2) [the defendant] was not prejudiced in making an intelligent plea as a result of the State's shift to a different prior conviction as the factual basis for its repeater allegation" (¶ 2).

With respect to the prejudice issue, these four justices concluded that there was no dispute that the defendant's prior convictions made him a repeater and that he was alleged to be a repeater before he entered his plea. Further, "the amendment did not prevent [the defendant] from meaningfully assessing the potential maximum penalty to which he could be subjected. Under § 939.62(1)(a), whether the State proved his repeater status by three misdemeanor convictions or by one felony conviction, [the defendant's] potential maximum penalty was the same. This is so because a battery conviction under Wis. Stat. § 940.19(1) is a Class A misdemeanor that has maximum imprisonment of nine months. Wis. Stat. § 939.51(3)(a). Therefore, even with the repeater enhancement, [the defendant's] maximum term of imprisonment for the battery conviction could not be increased to more than two years, regardless of whether the State relied on three misdemeanors or one felony" (¶ 31).

A different majority of the court (Chief Justice Abrahamson and Justices Bradley, Roggensack, and Butler) concluded that "the State's use of a CCAP report as evidence of [the defendant's prior] conviction does not constitute prima facie proof of that conviction and that [the defendant] did not waive his right to object to the State's use of the CCAP report" (¶ 2). These justices pointed out that CCAP does not afford proof beyond a reasonable doubt of factual propositions, because a CCAP report is not the official record of a criminal case and is not a copy of the actual judgment of conviction (see ¶ 46). In fact, the CCAP Web site includes a disclaimer regarding the accuracy of information contained on the site (see ¶ 7).

Said these justices, "[w]e cannot, under those circumstances, consider the contents of a CCAP report to rise to the level of reliability sufficient to establish prima facie proof that a defendant has a prior qualifying conviction. In addition, [the defendant] did not stipulate to using a CCAP report as the `mode of proof' for habitual criminality. He asserted before the circuit court that the State had not proved habitual criminality beyond a reasonable doubt; he has continued to do so throughout the appellate process. Therefore, we conclude that by relying solely on the CCAP report, and without other evidence that could prove [the defendant's] repeater status beyond a reasonable doubt, the State did not offer sufficient evidence to constitute prima facie proof that [the defendant] was an habitual criminal"(¶ 49).

Accordingly, the supreme court remanded the case to the circuit court to vacate the habitual criminality enhancer portion of the defendant's sentence (see ¶ 54).

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Criminal Procedure

State v. Brown, 2006 WI 100 (filed 12 July 2006)

The defendant entered guilty pleas to three felonies in which he was allegedly involved as a party to the crime. He thereafter moved to withdraw the pleas, claiming that he did not enter them knowingly, intelligently, and voluntarily. To support this claim, he pointed to the transcript of the plea hearing and alleged that the circuit court judge failed to discharge some of the duties imposed by Wis. Stat. section 971.08 (the guilty plea statute) and State v. Bangert, 131 Wis. 2d 246, 389 N.W.2d 12 (1986). The circuit court denied the motion without an evidentiary hearing. The court of appeals affirmed. In a unanimous decision authored by Justice Prosser, the supreme court reversed the court of appeals.

"A defendant is entitled to an evidentiary hearing on a motion to withdraw a guilty plea when (1) the defendant makes a prima facie showing that the circuit court's plea colloquy did not conform with § 971.08 or other procedures mandated at a plea hearing; and (2) the defendant alleges he did not know or understand the information that should have been provided at the plea hearing" (¶ 2). For the reasons described below, the supreme court concluded that the defendant sustained his burden and is therefore entitled to an evidentiary hearing on the motion.

The court noted several deficiencies in the guilty plea proceedings in this case. Most prominent was the failure of the circuit court to satisfactorily enumerate, explain, or discuss the facts or elements of the three felonies in a manner that would establish for a reviewing court that the defendant understood the nature of the charges to which he pleaded guilty. "The circuit court never enumerated, explained, or discussed the elements of first-degree sexual assault, armed robbery, or kidnapping, or the facts making up the elements. Although [the defendant's] attorney stated that he had explained the nature of the charges to [the defendant], the circuit court never asked either [the defendant] or his attorney to summarize the extent of the explanation or the elements of the crimes on the record. The circuit court never referred to the record from prior court proceedings to establish that [the defendant] understood the nature of the charges. The circuit court never referred to or summarized the charges as found in a plea questionnaire or other writing signed by [the defendant], because there were no such documents" (¶ 53).

Further, the defendant pleaded guilty to all charges as a party to the crime without the circuit court ever explaining or ensuring that the defendant understood the concept of party to a crime - an omission that could have significance under the particular facts and circumstances of this case (see ¶ 55). The court also indicated that "[a] statement from defense counsel that he has reviewed the elements of the charge, without some summary of the elements or detailed description of the conversation, cannot constitute an `affirmative showing that the nature of the crime has been communicated'" (¶ 58) (citation omitted).

Even with the deficiencies noted above, to obtain an evidentiary hearing on the motion to withdraw his guilty plea the defendant must allege that he did not know or understand the information that should have been provided at the plea hearing. "A defendant is not required to submit a sworn affidavit to the court, but he is required to plead in his motion that he did not know or understand some aspect of his plea that is related to a deficiency in the plea colloquy" (¶ 62). In this case the court concluded that the defendant's motion in this regard was sufficient though the allegations were crafted "somewhat indirectly" (see ¶¶ 4, 60-66). Said the court, "[i]n the ordinary case, defense counsel should plead with greater particularity a defendant's lack of understanding. A defendant must identify deficiencies in the plea colloquy, state what he did not understand, and connect his lack of understanding to the deficiencies" (¶ 67).

The supreme court also concluded that there were shortcomings with respect to the defendant's waiver of constitutional rights. The circuit court had recited the litany of rights waived by a guilty plea and secured an affirmative answer from the defendant that he was waiving each right. Defense counsel represented that he, too, had gone over the content of the standard guilty plea questionnaire (which includes the litany of rights) with the defendant (although the document was not executed by the defendant because he is illiterate). Said the supreme court, "[o]n the facts of this case, where the defendant was illiterate, where there was no waiver of rights form, and where there was no rendition by [the defendant's] attorney of a meaningful discussion of the defendant's rights, the court should have done more to show that the defendant understood the rights he was giving up by entering a plea. Probing questions may not always be necessary, but they help to ensure a defendant's understanding and they help to complete the hearing record" (¶¶ 76-77).

Lastly, the court considered the defendant's claim that the circuit court violated Wis. Stat. section 971.08(1) by failing to state that the punishment for each of the charges could run consecutively. The supreme court found it difficult to accept the defendant's suggestion that this failure would render a guilty plea defective. "The reasonable conclusion when a defendant is confronted with multiple charges is that the defendant could face multiple punishments. That realization is a major explanation for plea bargains that reduce the number of charges. Although the better practice is to advise a defendant of the cumulative maximum sentence he could receive from consecutive sentences, we do not believe the omission of such information should allow a defendant to withdraw a guilty plea in the absence of any allegation that the defendant did not understand the effect of multiple charges on his sentence. Failure to understand this simple concept would signal more serious problems with the plea" (¶ 78).

(Editors' note:The court's opinion in this case provides a comprehensive catalogue of the trial judge's duties at a guilty plea hearing. In a footnote the court referenced the summary of the judge's duties that is contained in Wis - JI Criminal SM-32 (1995) and "strongly encourage[d] courts to follow these plea-acceptance procedures"(¶ 23 n.11).)

State v. Kelty, 2006 WI 101 (filed 12 July 2006)

The defendant entered guilty pleas to two counts of first-degree reckless injury in violation of Wis. Stat. section 940.23(1)(a). The substance of the state's case was that the defendant struck a baby in the head at least twice with two different objects, causing two skull fractures, during a single episode of child abuse. The defendant brought a postconviction motion challenging the validity of her conviction on the second reckless injury count, claiming that it was multiplicitous. (The precise double jeopardy claim was a unit-of-prosecution multiplicity challenge. The defendant argued that the state improperly subdivided the same offense into multiple counts of violating the same statute (see ¶¶ 16-17).)

The circuit court denied the motion. It found that the defendant had waived any double jeopardy defect by pleading guilty to both counts. A divided court of appeals reversed, holding that only an express waiver of double jeopardy can relinquish a defendant's double jeopardy rights. In a majority decision authored by Justice Prosser, the supreme court reversed the court of appeals.

The precise question before the court was "whether an otherwise satisfactory guilty plea to two counts of violating the same statute in a single prosecution is sufficient to waive a unit-of-prosecution multiplicity challenge on direct appeal" (¶ 17). The court concluded that "a guilty plea relinquishes the right to assert a multiplicity claim when the claim cannot be resolved on the record. When a defendant enters a knowing, intelligent, and voluntary guilty plea, the nature and effect of the plea necessarily mean that the defendant gives up the right to a fact-finding hearing on the propriety of multiple charges" (¶ 2) (citation omitted). On the other hand, if a double jeopardy challenge can be resolved without any need to venture beyond the record, the court should decide the claim on its merits (see ¶ 39).

In this case, the record (i.e., the criminal complaint, the preliminary hearing transcript, and the information) contains evidence to support the charges, but the supreme court could not determine with certainty from the record exactly how the defendant inflicted the baby's injuries. "In other words, we cannot determine with certainty whether [the defendant's] two convictions for first-degree reckless injury were multiplicitous. All we know is that the State had the power to prosecute both counts on the evidence available; the defendant pled guilty to both counts after hearing the charges and the evidence, and after conferring in detail with her attorney; and the court, after a very thorough plea colloquy, had the power to convict and sentence the defendant on both counts. Without additional fact-finding, we could not learn more than we know now. Accordingly, we conclude that [the defendant's] guilty plea relinquished her opportunity to have a court determine the merits of her multiplicity challenge" (¶ 51).

The court specifically indicated that its decision should not be understood to render guilty pleas impervious to double jeopardy challenges. "A defendant retains the right (1) to challenge whether a plea is knowing, intelligent, and voluntary by pointing to errors in the plea colloquy pursuant to State v. Brown, 2006 WI 100, __ Wis. 2d __, __ N.W.2d __ [digested above] and State v. Bangert, 131 Wis. 2d 246, 389 N.W.2d 12 (1986); (2) to claim the ineffective assistance of counsel pursuant to State v. Bentley, 201 Wis. 2d 303, 548 N.W.2d 50 (1996); and (3) to challenge the authority of the state to prosecute her and the power of a court to enter the conviction or impose the sentence, where the existing record allows the court to determine whether the defendant's double jeopardy rights have been violated" (¶ 3).

The court further noted that, even though a guilty plea relinquishes a defendant's right to a fact-finding hearing on a double jeopardy challenge, nothing about the court's decision in this case prevents a prosecutor or a court from securing a defendant's express waiver of his or her double jeopardy rights. See Salters v. State, 52 Wis. 2d 708, 714, 191 N.W.2d 19 (1971) (recognizing the validity of an express waiver of double jeopardy rights). "We believe this is the better practice. Express waivers not only make for a more complete record, but also allow a circuit court and a prosecutor to guard against the possibility of reversible error. They lend greater confidence to convictions secured by guilty pleas, by reducing concerns that a conviction may have resulted in part from some shortcoming or deficiency of defense counsel" (¶ 45).

Although the issue in this case was presented in the context of a multiplicity challenge on direct appeal, the court also pointed out that "[a] guilty plea waives a multiplicity claim anytime the claim cannot be resolved on the record, regardless whether a case presents on direct appeal or collateral attack"(¶ 34).

Chief Justice Abrahamson filed a concurring opinion. Justice Butler filed a concurring opinion as well that was joined by Justice Bradley.

State v. Brockdorf, 2006 WI 76 (filed 28 June 2006)

A Milwaukee police officer, Vanessa Brockdorf, was charged with obstructing an officer for knowingly giving false information to a detective, Michele Harrison, with the intent to mislead her, contrary to Wis. Stat. section 946.41(1). The obstruction allegedly occurred when Brockdorf was questioned by Harrison, who was conducting a criminal investigation into allegations that Brockdorf's squad partner had physically abused a shoplifting suspect who was in the custody of Brockdorf and her partner. Brockdorf gave one statement on Sept. 19, 2003, at her home and another on Oct. 3, 2003, at a police facility. In the latter statement "she essentially admitted her first statement was untrue" (¶ 11).

Brockdorf filed a motion to suppress the Oct. 3 statement, claiming that it was not voluntary under Garrity v. New Jersey, 385 U.S. 493 (1967). In Garrity, the Supreme Court held that statements given under threat of discharge from public employment are compelled and may not be used in subsequent criminal proceedings. "The [Garrity] Court ultimately concluded that `the protection of the individual under the Fourteenth Amendment against coerced statements prohibits use in subsequent criminal proceedings of statements obtained under threat of removal from office, and that it extends to all, whether they are policemen or other members of our body politic'" (¶ 18).

The circuit court concluded that Brockdorf's Oct. 3 statement was the product of a coercive choice and that Brockdorf was entitled to an offer of Garrity immunity. The court of appeals reversed. It held that the Oct. 3 statement was not forced or compelled. In a majority decision authored by Justice Wilcox, the supreme court affirmed the court of appeals.

After reviewing extensive case law interpreting Garrity, the supreme court adopted a two-pronged subjective/objective test for determining whether, as a matter of law, an officer's statements given in a criminal investigation are coerced and involuntary and therefore subject to suppression under Garrity (see ¶ 3). "Thus, in order for statements to be considered sufficiently compelled such that Garrity immunity attaches, a police officer must subjectively believe he or she will be fired for asserting the privilege against self-incrimination, and that belief must be objectively reasonable.... In applying this analysis, we must ultimately examine the totality of the circumstances surrounding the statements. However ... an express threat of job termination or a statute, regulation, rule, or policy in effect at the time of the questioning which provides for an officer's termination for failing to answer the questions posed, will be a sufficient circumstance to constitute coercion in almost any conceivable situation" (¶¶ 35-36) (citations omitted).

Applying this test, the court concluded that the subjective prong of the analysis was satisfied because Brockdorf testified at the suppression hearing that she figured she would later be fired if she elected not to talk to Harrison. The court also concluded, however, that Brockdorf's subjective belief was not objectively reasonable. Neither Harrison nor her partner expressly threatened Brockdorf with the loss of her job for choosing to exercise her right to remain silent in the interrogation.

"Additionally, there is no state law, ordinance, departmental regulation, or longstanding departmental policy that forces an officer to choose between job loss and self-incrimination. Thus, if Brockdorf had elected to exercise her Fifth Amendment privilege against self-incrimination, termination would not have automatically followed for that reason" (¶ 38). Brockdorf was not in custody at the time of the interrogation. The questioning took place as part of a criminal investigation, not a personnel investigation (during which police officers may legitimately be compelled, under the threat of job termination, to answer questions as long as those statements are not used against the officer in a subsequent criminal proceeding) (see ¶ 39). Brockdorf did not claim to have confused the criminal battery investigation with a personnel inquiry.

"In our view, however, the only `significant coercive action of the state' that Brockdorf can point to is the alleged threat Harrison and [Harrison's partner] made to Brockdorf to talk or get charged with obstructing. Without an express threat of termination, however, we conclude that this admonishment did not deprive Brockdorf of her right to make a free and reasoned decision to remain silent. In other words, Brockdorf's belief that she would be terminated for maintaining silence remained objectively unreasonable. Under the totality of the circumstances, we conclude that Brockdorf felt compelled to give a statement because: (1) she had lied to investigators in September about her partner's criminal conduct; (2) she realized she had been caught in the lie; and (3) she concluded the best course of action at that time was to confess to the truth as opposed to continuing to lie or remaining silent. Nothing that Harrison or [Harrison's partner] did was objectively coercive enough for us to conclude that Brockdorf's statement was involuntary under Garrity" (¶ 43) (citations omitted).

Justice Crooks filed a dissenting opinion that was joined by Justices Prosser and Butler. Justice Butler also filed his own separate dissent.

State v. Anderson, 2006 WI 77 (filed 29 June 2006)

The defendant was convicted of first-degree sexual assault of a child. In a published decision the court of appeals affirmed the conviction. See 2005 WI App 238. In a majority decision authored by Chief Justice Abrahamson, the supreme court reversed the court of appeals.

The court noted that this case turned on the credibility of witnesses and that the jury clearly had difficulty sorting out the evidence during its deliberations (see ¶ 121). The defendant's claims of error on appeal centered on the circuit court's responses to various jury requests to reexamine the evidence.

The majority concluded that the circuit court committed error in each of the following respects: "(A) by allowing the jury to see and hear the victim's videotaped interview in the jury room during deliberations rather than on the record in open court; (B) by communicating with the jury during its deliberations outside the presence of the defendant and without notice to or consultation with the defendant [in violation of the defendant's right to be present at all substantive steps in a trial (see ¶ 43)]; (C) by communicating with the jury outside of the presence of defense counsel and without notice to or consultation with the defense counsel [in violation of the defendant's right to counsel (see ¶ 69)]; (D) by failing to make or preserve a record of its statements or comments to the jury relating to the case [as required by Wis. Stat. § 805.13(1) (see ¶ 78)]; and (E) by refusing the jury's requests to have the defendant's and the victim's in-court testimony read to it while allowing the jury during deliberation to see and hear the victim's videotaped interview" (¶ 126). With respect to the last error, the court characterized the results of the circuit court's actions as follows: "The direct testimony of the State's most significant witness could be replayed in its entirety while the jury was not permitted to hear again the in-court testimony and cross-examination of the victim or the defendant, even though the jury believed it needed the in-court testimony to decide the case" (¶ 107).

The supreme court further concluded that, on the facts of this case, the defendant was prejudiced by the circuit court's errors (see ¶ 127). Accordingly, the supreme court vacated the judgment of conviction and remanded the matter to the circuit court for a new trial.

Justice Roggensack filed a dissenting opinion that was joined by Justice Wilcox.

State v. Campbell, 2006 WI 99 (filed 12 July 2006)

The defendant was convicted of felony bail jumping and two counts of parental interference with the custody of a child. On appeal he sought to reverse one of the interference charges and the bail jumping charge. The defendant claimed that the circuit court erred when it prevented him from collaterally attacking the validity of the family court's order, issued in divorce proceedings, that awarded his wife temporary custody of the children. The defendant argued that his wife procured the custody order by fraudulently representing to the family court that she was the adoptive mother of one of the children. The defendant claimed that at the time a Missouri court granted the adoption, he and his wife represented to the Missouri court that they were residents of Missouri, when in fact they were not. Following a jury trial, the defendant appealed. The court of appeals certified the case to the supreme court, which granted certification.

In a majority opinion authored by Justice Prosser, the supreme court affirmed. It concluded that "a court may permit a collateral attack on a judgment or order procured by fraud if the fraud is jurisdictional, making the judgment or order void, thereby negating an element of a crime, or if the fraud raises an affirmative defense to the crime" (¶ 4). Here, the court concluded that there was no jurisdictional fraud. "We agree with the State and conclude that since the [Wisconsin] family court had both subject matter jurisdiction to make the custody determination and personal jurisdiction over Campbell, there was no jurisdictional fraud" (¶ 39). Therefore, the temporary custody order was not void and the mother had legal custody of the child (see ¶ 48). The defendant had to abide by the terms of that order until he succeeded in reversing it through the applicable review process (see ¶ 49).

The defendant also argued that he should have been permitted to present evidence of his wife's alleged misrepresentation as part of an affirmative defense at trial. He argued that Wisconsin allows a defendant to disregard an order procured by fraud and then collaterally attack the fraudulently obtained judgment when the judgment supplies the basis for a criminal prosecution. For a variety of reasons described in the opinion, the supreme court declined to recognize a common law affirmative defense of fraud to the crime of interference with custody (see ¶¶ 56-62).

Lastly, the court considered whether the circuit court had the authority to require, as a condition of probation, that the defendant pay the attorney fees of standby counsel. On this issue the supreme court concluded that "in exercising its discretion to appoint standby counsel, a circuit court may impose the attorney fees of standby counsel upon a defendant as a condition of probation where either (1) the defendant agrees to reimburse the county for the attorney fees; or (2) the court informs the defendant of his potential liability for the fees and the defendant uses standby counsel so extensively that he or she functions as traditional defense counsel. Under both alternatives, however, before imposing fees the court must determine the defendant's ability to pay pursuant to Wis. Stat. § 973.20(13)(a)2. to 5" (¶ 5). In this case, the court determined that the defendant is responsible for attorney fees under either test. He agreed at the initial appearance to pay the fees of standby counsel. Further, the court informed him of his obligation to reimburse the county for the fees and the defendant used the attorney in his defense so extensively that the attorney was functioning as traditional defense counsel (see ¶ 78). However, because the circuit court never determined the defendant's ability to pay attorney fees, the supreme court remanded the matter for the circuit court to make that determination (see ¶ 79).

Justice Butler filed an opinion concurring in part and dissenting in part that was joined by Chief Justice Abrahamson.

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Family Law

Kenosha County Dep't of Human Servs. v. Jodie W., 2006 WI 93 (filed 11 July 2006)

A circuit court terminated a mother's parental rights to her 6-year-old son. The mother was found unfit because her incarceration rendered her unable to meet the conditions for return set forth in a CHIPS order. The mother acknowledged at a hearing "that she could not meet the `suitable residence' conditions within 12 months because she would not be able to present any evidence that she might be released within the next 12 months, and therefore entered a no contest plea" (¶ 10). The court of appeals affirmed.

In a decision authored by Justice Butler, the supreme court reversed. The court first addressed the threshold issue of whether the mother waived her right to challenge the statute's constitutionality by entering a no contest plea (see ¶ 21). The court held that "there is insufficient evidence to support a determination that Jodie entered her plea knowingly, voluntarily, and intelligently" (¶ 38). The plea form contained various inconsistencies, the circuit court's colloquy was "incomplete," and the court refused to accept testimony regarding her reasons for the no contest plea.

The court then turned to the substantive due process claim, holding "that in cases where a parent is incarcerated and the only ground for parental termination is that the child continues to be in need of protection or services solely because of the parent's incarceration, Wis. Stat. § 48.415(2) requires that the court-ordered conditions of return are tailored to the particular needs of the parent and child" (¶ 51). Stated differently, "[s]ubstantive due process requires that the State's action to terminate [the mother's] parental rights be narrowly tailored to meet the State's compelling interest of protecting [the son] from an unfit parent. Both the court-ordered conditions of return and the circuit court's evaluation of [the mother's] failure to meet these conditions were not narrowly tailored to meet that interest" (¶ 55).

Justice Wilcox, joined by Justice Prosser, dissented on the grounds that the mother's plea was valid and that the circuit court had made an "individualized determination of her fitness as a parent.... [N]ow children of incarcerated parents will be serving a concurrent sentence in limbo" (¶ 59).

Justice Crooks did not participate.

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Insurance

Teschendorf v. State Farm Ins. Co., 2006 WI 89 (filed 7 July 2006)

While in the course of employment, Scott Shira was killed in a car accident caused by an uninsured driver. Shira was unmarried and had no dependents. His worker's compensation insurer paid about $160,000 in benefits to the state's Work Injury Supplemental Benefit Fund (the Fund) and about $12,000 to his parents for funeral expenses. At the time of his death, Shira also carried $150.000 of uninsured motorist (UM) coverage with American Family Mutual Insurance Co. Shira's parents brought a wrongful death claim to recover the UM benefit. Based on the policy's reducing clause, the circuit court granted summary judgment in favor of American Family. The court of appeals reversed in a split decision.

The supreme court, in a decision authored by Justice Prosser, affirmed. "The issue presented is whether an insurer may reduce the uninsured motorist coverage limits in its policy by amounts paid under a worker's compensation law, where the amounts paid go to the State of Wisconsin Work Injury Supplemental Benefit Fund (the Fund) rather than the insured or any person related to the insured" (¶ 1). The court held that "Wis. Stat. § 632.32(5)(i)2. (2001-02) does not allow an insurer to reduce uninsured motorist policy limits by worker's compensation payments that are not made to or on the behalf of the insured, the insured's heirs, or the insured's estate" (¶ 2).

The court was evenly divided over whether the statute's meaning was plain on its face or, instead, was ambiguous, thereby requiring the court to resort to other tools of construction. Nonetheless, all the justices reached the same conclusion: "Wis. Stat. § 632.32(5)(i)2. does not allow an insurer to reduce uninsured motorist coverage limits by worker's compensation payments made to the Fund" (¶ 18). The holding was rooted in the UM statute's legislative history and in public policy (see ¶ 44).

Chief Justice Abrahamson concurred but wrote separately to emphasize "that the majority opinion demonstrates the futility of labeling a statute as ambiguous or unambiguous as a means of statutory interpretation instead of just determining what a statute means" (¶ 65). In a separate concurrence, Justice Prosser also contended that "American Family's reducing clause would not pass muster on these facts - irrespective of any statute - because it is at war with the reasonable expectation of its insured" (¶ 72).

Kontowicz v. American Standard Ins. Co., 2006 WI 90 (filed 7 July 2006)

In this per curiam order, the court declined to reconsider its decision in Kontowicz v. American Standard Insurance Co., 2006 WI 48, with regard to calculating interest owing on overdue claims under Wis. Stat. section 628.48. "However, in the interest of clarifying our opinion to facilitate its application, we agree to clarify that Wis. Stat. § 628.46 interest begins to run on an overdue claim 30 days after the claimant provides the statutorily required notice (33 days in situations where the claimant mails the statutorily required notice to the insurer)" (¶ 3). The court also reworded "the last sentence of ¶ 53 in Kontowicz" so that it conformed with this clarification (¶ 4).

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Property

Sonday v. Dave Kohel Agency Inc., 2006 WI 92 (filed 11 July 2006)

The plaintiffs owned two parcels of commercial property and contracted with the Dave Kohel Agency to list the parcels for sale. The parties used the standard WB-5 commercial listing contract form approved by the Wisconsin Department of Regulation and Licensing. The contract provided for a 6 percent commission. Ultimately, the properties were acquired by an agency of the local municipal government through condemnation proceedings.

The plaintiffs brought an action in circuit court seeking a judgment that the defendant did not have a right to a commission under the listing contract because their properties were transferred as the result of a condemnation action. The circuit court granted summary judgment to the defendant. The plaintiffs appealed and the court of appeals certified two questions to the supreme court: "(1) is a real estate broker entitled to a broker's commission under a listing contract when the listed real estate is condemned and acquired by a governmental agency during the listing; and (2) if the real estate listing contract permits recovery of a broker's commission in a condemnation, does public policy preclude such payment?" (¶ 2).

In a majority decision authored by Justice Butler, the supreme court concluded that "the transfer of property by a condemnation action constitutes a sale under the terms of the contract in this case" (¶ 3). Said the court, "in a condemnation action in Wisconsin, the title to the property is conveyed to the government and the title vests in that government entity as of the date and time of the recording of the compensation award. Wis. Stat. § 32.05(7)(c). Because the transfer of title in exchange for compensation constitutes a sale, and because a condemnation action transfers title in exchange for compensation, we conclude that a condemnation action constitutes a sale, albeit a forced sale, for purposes of the Department-approved WB-5 Listing Contract"(¶ 45).

The court further held that the defendant real estate broker is entitled to a 6 percent commission based on the jurisdictional award. "Under the WB-5 Listing Contract, a broker's commission is earned when the property is sold. We therefore conclude that the award recorded with the county register of deeds and paid to the condemnee, which causes the transfer of title, is the proper basis for the broker's commission" (¶ 49).

Lastly, the court concluded that "public policy does not preclude [the defendant] from recovering the commission agreed to in the WB-5 listing contract" (¶ 56).

Justice Bradley filed a dissenting opinion.

AKG Real Estate v. Kosterman, 2006 WI 106 (filed 14 July 2006)

As succinctly stated by Justice Prosser, "[t]his case presents the question whether an express easement may be relocated or terminated without the consent of the dominant estate. In a published decision, the court of appeals held that a servient estate could unilaterally terminate an express right-of-way easement once the servient estate provided an alternate route of ingress and egress to the dominant estate. We reverse the court of appeals because we conclude that the owner of a servient estate cannot unilaterally relocate or terminate an express easement" (¶ 1).

The Kostermans bought a four-acre lot (the "dominant estate") that "lacked access to a public road except by means of three recorded, physically overlapping easements across part of an 80-acre parcel of land (the Servient Estate), which partially surrounded their property" (¶ 4). A real estate group, AKG, owned the servient estate and intended to develop a subdivision on it. AKG offered alternate public road access, which the Kostermans rejected. AKG then filed this declaratory judgment action, and the Kostermans counterclaimed. The circuit court granted summary judgment in favor of AKG. The court of appeals affirmed.

The supreme court, in an opinion written by Justice Prosser, reversed. AKG argued that the so-called 1961 easement should be terminated on the ground that it was impossible to fulfill its purpose (see ¶ 21). The supreme court disagreed. "[N]either a prescriptive easement nor an express easement can be modified or terminated solely because the necessity for the easement ceases. Thus, `[t]he rule that the right ceases with necessity has no application to ways acquired by express grant or by prescription; a right to a way so created cannot be defeated by showing that the owners have another convenient and accessible way of going to and from their premises.' Thus, even if AKG did provide alternate public road access to the Kostermans, the 1961 easement would remain in force, because an express easement continues regardless of whether the dominant estate needs the easement" (¶ 28) (citations omitted).

The court also held that it would not modify the easement despite the fact that changed conditions made it unduly burdensome on the servient estate (see ¶ 29). "We agree with the Kostermans and the courts that have rejected the Restatement (Third) of Property: Servitudes §§ 4.8(3) and 7.10(2) in favor of preventing the owners of servient estates from unilaterally relocating or terminating express easements. These courts have rejected the position advanced by the Restatement as a threat to the certainty of property rights and real estate transactions, as a catalyst for increased litigation, and as a means for purchasers of servient estates to reap a windfall at the expense of owners of dominant estates. We agree that these reasons for rejecting the Restatement's position are more compelling than the economic inefficiencies that might result from bilateral monopolies and hold-out easement owners"(¶ 35) (citations omitted).

The court also rejected, in a fact-intensive analysis, AKG's alternative argument that "the 1998 deeds extinguished the 1960 and 1961 easements" (see ¶¶ 40-45).

Chief Justice Abrahamson and Justice Bradley each filed concurring opinions in which the other also joined. Chief Justice Abrahamson found the majority opinion too broadly worded, and Justice Bradley cautioned that the opinion did not address critical concepts such as "impossibility or cessation of purpose" (¶ 57).

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Remedies

Huml v. Vlazny, 2006 WI 87 (filed 7 July 2006)

This case "addresses the relationship between the restitution order in a criminal case and a subsequent settlement agreement in a civil case" (¶ 1). Vlazny seriously injured Huml in a drunk-driving-related collision in 1993. Vlazny was convicted for this crime, placed on probation, and ordered to pay restitution of $140,000, at a monthly rate that would leave a large balance due at the end of his probation term. In 1995 Huml filed a civil action against Vlazny and Vlazny's insurer. The case was settled, and the ensuing settlement entitled Huml to receive more than $500,000 plus additional monthly payments. Vlazny remained on probation until 2002, when the circuit court agreed to terminate his probation and entered a civil judgment of about $108,000 for the unpaid restitution (see ¶ 10). Vlazny later moved the court to rule that the judgment should be reduced to zero because of the 1995 settlement. The court ruled instead that Huml could enforce the judgment. Vlazny appealed, and the court of appeals certified the case to the supreme court.

In an opinion authored by Justice Prosser, the supreme court reversed. The appeal presented two issues. "First, may a civil settlement agreement between a crime/tort victim and a criminal defendant/tortfeasor preclude the victim from collecting unpaid restitution that the defendant was ordered to pay in the criminal proceeding, after the defendant's probation ends and the unpaid restitution is reduced to a civil judgment pursuant to Wis. Stat. §§ 973.09(3)(b) and 973.20(1r)?" (¶ 2).

The court held "that a civil settlement agreement can have no effect upon a restitution order while the defendant remains on probation, unless the circuit court finds that enforcing the restitution order in addition to the settlement agreement would result in a double recovery for the victim. After a defendant is released from probation, however, and any unpaid restitution under the restitution order is converted to a civil judgment, a settlement agreement between the victim and defendant may - depending upon its terms - preclude the victim from enforcing the judgment" (¶ 5).

Restitution "in a criminal case is a remedy that belongs to the state, not to the victim.... Termination of probation, however, signals the state's disavowal of any penal or rehabilitative interests. Thereafter, only the goal of compensating the victim remains. This is an objective adequately accomplished by entry of a civil judgment, which can be enforced through civil enforcement mechanisms. Consequently, it is consistent with Wisconsin precedent to allow a victim, in anticipation of the defendant completing probation, to release her right to enforce any judgment derived from unpaid restitution as part of a settlement agreement"(¶ 44). The court's statutory interpretation furthered the public policy objective of providing a victim with "leverage to negotiate a favorable settlement" through the inducement of a release (see ¶ 48).

Second, the court addressed the 1995 settlement and concluded that it had the effect of releasing Vlazny. "[T]he plain language of the settlement agreement released all Huml's claims and rights to damages arising from the accident" (¶ 55).

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Taxation

Northwest Airlines Inc. v. Wisconsin Dep't of Revenue, 2006 WI 88 (filed 7 July 2006)

Wisconsin taxes air carrier companies under an ad valorem tax codified in Wis. Stat. chapter 76. Each air carrier's property is valued on a company-wide basis, and a percentage of this amount is attributed to Wisconsin for purposes of calculating the ad valorem tax (see ¶ 16).

In 2001 the Wisconsin Legislature created an ad valorem tax exemption for air carrier companies that satisfy either of two statutorily-described criteria for operating a hub facility in Wisconsin. The purposes of the exemption are to maintain the state's air transportation system, protect existing jobs, encourage the development of additional air transportation facilities, and preserve the state's competitiveness in attracting and retaining business and industry.

Midwest Airlines Inc. and Air Wisconsin Airlines Corp. qualified for the exemption in 2002. The Legislative Fiscal Bureau estimated that in 2002 the hub exemption relieved Midwest Airlines of nearly $2 million in ad valorem taxes and relieved Air Wisconsin of nearly $600,000 in ad valorem taxes. Northwest Airlines Inc., with headquarters in Minnesota, did not qualify in 2002 for the tax exemption (which would have been worth $1.5 million), and it filed this lawsuit challenging the constitutionality of the tax exemption. The circuit court held the tax exemption unconstitutional. The court of appeals certified the case to the supreme court, which granted certification.

In a majority decision authored by Justice Prosser, the supreme court held that the hub exemption to the ad valorem tax violates neither the Equal Protection Clause of the United States Constitution nor the Uniformity Clause of the Wisconsin Constitution (see ¶ 14). As to both challenges the court concluded that the classifications made by the hub exemption are rationally related to the legitimate governmental purpose of ensuring the vitality of Wisconsin's economy (see ¶ 66). The court also held that 49 U.S.C. § 40116 precludes dormant Commerce Clause review of the hub exemption (see ¶ 14). It found that "49 U.S.C.A. § 40116 demonstrates - with unmistakable clarity - congressional consent to allow states to impose differential taxes among air carriers" (¶ 36).

Chief Justice Abrahamson filed a dissenting opinion that was joined by Justice Bradley. Said the Chief Justice, "[b]ecause I conclude that the Wisconsin tax system favoring a Wisconsin hub carrier imposes an impermissible burden on interstate commerce, interfering with the very purpose of the Commerce Clause, I dissent" (¶ 69).

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Torts

Bartholomew v. Wisconsin Patients Compensation Fund, 2006 WI 91 (filed 7 July 2006)

Helen Bartholomew (the wife) suffered a heart attack, which caused brain damage and other serious physical problems. She died five years later. Her husband and her estate brought this medical malpractice action. A jury awarded a total of $1.2 million for noneconomic damages, including $500,000 to the wife's estate for her predeath pain and suffering, $350,000 to the husband for his predeath loss of the wife's society and companionship, and the same amount for his postdeath loss of her companionship. The circuit court and the court of appeals molded the awards according to prevailing case law on damage caps.

The supreme court, in an opinion written by Chief Justice Abrahamson, reversed in a decision that overruled case law on damage caps that had blurred the distinction between predeath and postdeath noneconomic loss. Because of the opinion's far-reaching effect and the court's close analysis of the issues, this summary quotes extensively from the lead opinion.

"The issue in the present case is whether the following awards collectively are limited to the maximum allowed under the cap on wrongful death actions: the jury award for noneconomic damages to the estate of [the wife] for her predeath pain, suffering, and disability; the jury award to [the husband] for noneconomic damages for the predeath loss caused by his wife's disability; and the jury award to [the husband] for noneconomic damages for his postdeath loss of his wife's society and companionship" (¶ 2). A majority of the court concluded that Maurin v. Hall, 2004 WI 100, "which held that when a victim of medical malpractice dies, the cap for wrongful death actions limits all noneconomic damages," was "wrongly decided and must be overturned" (¶ 3). (Justice Butler's rationale differed from those of the lead opinion but he joined to make a majority.)

"In addition, a majority of the court, the same four justices [Abrahamson, Bradley, Crooks, and Butler], agrees that the estate of [the wife] is entitled to the full $500,000 award for [the wife's] predeath pain and suffering, that [the husband] individually is entitled to the full $350,000 award for his noneconomic damages for his predeath loss of his wife's society and companionship, and that [the husband] individually is entitled to the full $350,000 award for his postdeath loss of his wife's society and companionship (wrongful death loss of society and companionship). Justice Butler reaches this result on different grounds" (¶ 4). The court's conclusions regarding damage caps are carefully set forth at paragraphs 115 to 119.

"The challenge to Maurin in the present case is not to that part of Maurin holding that, when medical malpractice results in death, the wrongful death cap applies to a claimant's noneconomic damages for postdeath loss of society and companionship. Nor is any challenge made in the instant case to the constitutionality of applying the wrongful death cap to a claimant's noneconomic damages for postdeath loss of society and companionship in a medical malpractice case. The present case therefore leaves undisturbed that part of Maurin that holds the wrongful death cap applicable to a claimant's noneconomic damages for postdeath loss of society and companionship in a medical malpractice action" (¶ 6).

Concurring, Justice Crooks "strongly support[ed]" the lead opinion but wrote separately to criticize the rationale of Justice Butler's concurrence, which argued that the statutes created "an occurrence-based total global cap on the recovery of all noneconomic damages that arise from medical malpractice" (¶ 131). This global medical malpractice cap was struck down as unconstitutional in Ferdon v. Wisconsin Patients Compensation Fund, 2005 WI 125, which meant that only the wrongful death limit remained in effect.

Justice Prosser also concurred in part and dissented in part. Along with Justice Wilcox, he also joined Justice Roggensack's opinion, which concurred in part and dissented in part. Justice Roggensack contended that Maurin "correctly decided that the legislature created an occurrence-based cap on the recovery of all noneconomic damages that arise from medical malpractice, to which all plaintiffs and all types of claims are subject. I also conclude that Maurin does not prevent the plaintiffs from selecting whichever cap on noneconomic damages they prefer" (¶ 174).

Hanson v. American Family Mut. Ins. Co., 2006 WI 97 (filed 12 July 2006)

Hanson was hit from behind by a truck while driving to work. She suffered a variety of injuries, some of which healed, but she later underwent back surgery because of recurrent neck pain. Although Hanson followed her doctor's advice regarding the surgery, a medical expert for the defense testified that the surgery was unnecessary and not caused by the accident and suggested that Hanson's doctor may have committed malpractice. A jury returned a verdict that awarded damages of far less than the amount Hanson claimed. The court of appeals reversed and ordered a new trial.

The supreme court, in an opinion written by Justice Wilcox, affirmed the court of appeals. The case presented two issues. "First, is Hanson entitled to her expenses for a surgery, admittedly well-done, but allegedly not necessitated by her injury, just as a plaintiff is entitled to her expenses when surgery necessitated by the injury was negligently performed and aggravates the injury?" (¶ 2). The court held "that because the jury concluded that Hanson was injured in the accident, she was entitled to all of her past medical expenses, regardless of whether Hanson's treating physician performed an unnecessary surgery, under the rule first enunciated in Selleck v. Janesville, 100 Wis. 157, 75 N.W. 975 (1898), as Hanson used ordinary care in selecting her doctor" (¶ 3). Although last cited 30 years ago, "[t]he Selleck rule has been a part of Wisconsin case law since 1898. This rule essentially states that when a tortfeasor causes an injury to another person who then undergoes unnecessary medical treatment of those injuries despite having exercised ordinary care in selecting her doctor, the tortfeasor is responsible for all of that person's damages arising from any mistaken or unnecessary surgery" (¶ 20).

"The important questions are whether the surgery arose from an initial injury that itself was caused by the accident and whether Hanson used ordinary care in selecting her physician. Here, the jury determined that Hanson was injured in the accident, and while seeking treatment with ordinary care she had an allegedly unnecessary surgery performed. These facts are sufficient to bring this case under the ambit of the Selleck rule" (¶ 25). Thus, Hanson was entitled to all of her past medical expenses ($75,000, not the $25,000 awarded by the jury).

Second, the court held that the jury instructions were unduly confusing and erroneous. The supreme court agreed with the court of appeals' conclusion: "By telling the jury that it could not consider the doctor's alleged malpractice, and at the same time telling the jury it must find that all treatments were related to the accident, the trial court let the jury decide that the treatment it concluded was unnecessary was not `caused' by the accident, and was therefore not compensable. That is not the law in Wisconsin.... In effect, the trial court told the jury that regardless of whether the surgery was unnecessary, they could not award the cost of the surgery unless the jury `relate[d those injuries] ... to the accident'" (¶ 40).

This instruction, said the court, probably misled the jury, which awarded only pre-surgery past medical expenses. "That is, although the jury determined that Hanson had been injured in the accident, it granted her only $25,000 in past medical expenses, as opposed to the full amount of $78,123.97. It appears that the amounts awarded for the remaining damages were also limited to damages incurred prior to the surgery. Because the jury misapplied the law as to past medical expenses, there is a reasonable probability of a different outcome with respect to the remaining damages at issue if the jury is correctly instructed on the law" (¶ 42).

Chief Justice Abrahamson concurred in the application of the Selleck rule, despite a "muddled defense and a muddled record" (¶¶ 44-49).

Justice Prosser dissented on grounds that Selleck was not applicable and that the majority's decision commits the logical fallacy of "post hoc, ergo propter hoc" (see ¶¶ 51-91).

Butler v. Advanced Drainage Sys. Inc., 2006 WI 102 (filed 13 July 2006)

A group of riparian property owners sued several defendants on theories of negligence and nuisance for damages caused by rising water levels in a lake. The circuit court dismissed the claims, and the court of appeals affirmed.

The supreme court, in an opinion written by Justice Roggensack, affirmed. The court held that the negligence claims were properly dismissed on public policy grounds. More precisely, "the sixth public policy factor, that imposing liability would enter a field that has no sensible or just stopping point, is the factor that compels us to preclude liability" (¶ 22). Rockweit v. Senecal, 197 Wis. 2d 409, 541 N.W.2d 742 (1995), provided the framework for the court's analysis. "If we were to permit liability against the defendants before us, we would be opening the door to property owners' claims against any contractor who contracts with a municipality to remediate a naturally occurring hazard, when the contractor fails to completely abate the hazard's effects. This broad exposure to liability would chill municipalities' efforts in attempting abatement projects. It could also chill contractors from bidding on those types of municipal projects; where in addition to being subject to a breach of contract action by the municipality for not performing as they had contracted to perform, the contractors would be subject to litigation by any property owner who would have benefited from a successfully performed municipal contract" (¶ 25).

The private nuisance claims fell for the same reason, because the court determined that the plaintiffs could not have met their burden of showing evidence "sufficient to support liability" for their damages. "The plaintiffs' nuisance claim is based on the same allegedly negligent abatement of the flooding around the Lake. Therefore, ... we conclude that even if we assume, arguendo, that the plaintiffs were able to prove all of their allegations with regard to the private nuisance claim, it is appropriate to preclude liability for the nuisance claim based on the same public policy factors that limit liability in the underlying negligence claim. Were we not to do so, we would cause the potential for liability to be tied to the label the plaintiffs applied to each claim. Permitting the nuisance claim to proceed would also be inconsistent with the public policy factors on which we have limited liability" (¶ 34).

Justice Roggensack also filed a separate concurring opinion, which contended that the majority's decision to proceed on a case-by-case basis "provides little guidance for the courts, future litigants, or the public who may face similar legal issues in the future. I write separately because analyzing the plaintiffs' claims under Restatement (Second) of Torts § 324A would have provided more guidance to those who assert or defend a tort claim based on the breach of a contract to which the plaintiff was not a party" (¶ 38).

Justice Bradley, joined by Chief Justice Abrahamson and Justice Butler, dissented on three grounds. "First, I would follow the better practice and decline to apply the public policy factors on the summary judgment record before us. Second, even if I were to attempt an application of the factors on the present record, that application would not justify limiting liability at this stage of proceedings. Third, I write to observe that this case illustrates why there is often an uncomfortable fit between summary judgment methodology and application of the public policy factors" (¶ 60).

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Trade Secrets Law

Burbank Grease Servs. LLC v. Sokolowski, 2006 WI 103 (filed 13 July 2006)

Sokolowski was employed by Burbank Grease Services in various management positions. When he left the company, he took certain information (for example, customer lists and other information about Burbank's customers) without Burbank's permission and with the knowledge that Burbank considered this information to be confidential. The defendant later began working for a different company and then allegedly provided the confidential information to his new employer and used the information to solicit customers for the employer.

When Burbank became aware that the defendant was soliciting its customers, it filed this action alleging that the defendant misappropriated Burbank's trade secrets in violation of Wis. Stat. section 134.90; breached his duty of loyalty to Burbank, which he owed as Burbank's agent; intentionally interfered with Burbank's business relationships; and committed computer crimes in violation of Wis. Stat. section 943.70(2). Burbank also filed claims against the defendant's new employer.

Both sides filed motions for summary judgment. The circuit court granted the defendants' motion and dismissed the complaint. The circuit court concluded that Burbank's confidential information was not protected by Wis. Stat. section 134.90(6), the trade secret statute, because the information did not meet the statutory definition of a trade secret. The circuit court also held that the enactment of section 134.90(6) precluded all common law tort claims based on the misappropriation of confidential information, except those that involved information that met the statutory definition of a trade secret. The circuit court further concluded that there had been no computer crime under Wis. Stat. section 943.70(2) because the defendant was authorized to obtain the computer-stored information at the time he obtained it. The court of appeals affirmed the circuit court. See 2005 WI App 28. In a majority decision authored by Justice Roggensack, the supreme court affirmed in part and reversed in part.

In previous decisions in this case that were not appealed, lower courts concluded that the confidential information described above did not qualify as a trade secret under Wis. Stat. section 134.90(1)(c). The supreme court accordingly did not address that question. Rather, it was asked to decide whether section 134.90(6) precludes Burbank's other claims for relief. The court concluded that "the plain language of Wis. Stat. § 134.90(6)(a) appears to have the effect of making § 134.90 the exclusive remedy for civil claims based on the misappropriation of a statutorily-defined trade secret" (¶ 20). However, the language in section 134.90(6)(b)2. leaves available all other types of civil actions that do not depend on information that meets the statutory definition of a "trade secret." Therefore, any civil tort claim not grounded in a trade secret, as defined in the statute, remains available to Burbank (see ¶ 33).

The court also addressed the applicability of Wis. Stat. section 943.70(2)(a)6., which prohibits the willful, knowing, and unauthorized disclosure of "restricted access codes or other restricted access information to unauthorized persons." The court concluded that this statute "was meant to prohibit disclosing information that would permit unauthorized persons to access restricted or confidential information. There has been no allegation that [the defendant] provided information to others that would permit them to access Burbank's computer system" (¶ 37). "In sum, we agree with the court of appeals' construction of Wis. Stat. § 943.70(2)(a)6, that it prohibits the unauthorized disclosure of codes, passwords or other information that grants access to restricted-access systems. We also agree with the court of appeals' conclusion that the statute was not meant to criminalize the disclosure of all types of information that could be stored on a computer, when that information was obtained with authorization in the first instance" (¶ 39) (citation omitted).

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

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Tribal Gaming

Dairyland Greyhound Park Inc. v. Doyle, 2006 WI 107 (filed 14 July 2006)

In 1989 the Wisconsin Legislature granted Wisconsin's governor the authority to enter into compacts with Indian tribes located in Wisconsin, pursuant to the Indian Gaming Regulatory Act. By 1992, Wisconsin's governor had entered into original compacts on behalf of the state, thereby creating a contractual relationship between the state and all 11 federally-recognized tribes and bands located within the state. The original compacts, which permitted the tribes to engage in certain Class III casino gaming on tribal land, including blackjack tables, electronic gaming machines, and pull-tab machines, initially lasted for seven-year terms, with automatic extensions for five-year terms, subject to the right of either party to issue a notice of nonrenewal before expiration of the term (see ¶ 7). The initial 1991-92 compacts were renewed in 1998 and 1999, each for a term of five years, and were renewed again in 2003. Since 1992, therefore, Class III gaming has been conducted on tribal land.

The present litigation stems from allegations by Dairyland Greyhound Park that a 1993 amendment to the Wisconsin Constitution deprives the governor of the authority to permit Wisconsin tribes to continue conducting casino-type gaming in Wisconsin. "The 1993 Amendment changed Article IV, Section 24 to (1) prohibit the legislature from authorizing gambling in any form except for specific games provided for in the amendment; and (2) narrowly define the nature of the state-operated lottery" (¶ 8).

The parties in this case did not dispute that the original compacts were valid when they were entered into in 1991 and 1992. The parties disagreed, however, as to whether the 1993 amendment changes the terms agreed to in the original compacts. "The Governor contends that the 1993 Amendment does not impact the terms of the Original Compacts. In contrast, Dairyland asserts that the 1993 Amendment precludes the State from renewing or amending the compacts" (¶ 17).

In a majority decision authored by Justice Butler, the supreme court concluded that "the 1993 Amendment to Article IV, Section 24 of the Wisconsin Constitution does not invalidate the Original Compacts. Because the Original Compacts contemplated extending the Compacts and amending the scope of Indian gaming within the Compacts, we further conclude that the parties' right of renewal is constitutionally protected by the Contract Clauses of the Wisconsin and United States Constitutions, and that amendments to the Original Compacts that expand the scope of gaming are likewise constitutionally protected by the Contract Clauses of the Wisconsin and United States Constitutions. We withdraw any language to the contrary in Panzer v. Doyle, 2004 WI 52, 271 N.W.2d 295, 680 N.W.2d 666, that would limit the State's ability to negotiate for Class III games under the Original Compacts. Accordingly, gaming can be expanded to the extent that the State and Tribes negotiate for additional Class III games" (¶ 2).

Justice Crooks filed a concurring opinion that was joined by Chief Justice Abrahamson and Justice Bradley. Justice Prosser filed an opinion concurring in part and dissenting in part that was joined by Justices Wilcox and Roggensack. Justice Roggensack filed an opinion concurring in part and dissenting in part that was joined by Justices Wilcox and Prosser.

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