PUBLISHED
OPINION
COURT OF
APPEALS
DECISION
DATED AND FILED
March 14,
2000
Cornelia G. Clark
Acting Clerk, Court of Appeals
of
Wisconsin
NOTICE
This opinion is subject to further editing. If published, the official version will
appear in the bound volume of the Official Reports.
A party may file with
the Supreme Court a petition to review an adverse decision by the Court of Appeals.
See
Wis. Stat. §808.10
and Rule 809.62.
No. 98-3102
STATE OF
WISCONSIN IN COURT OF APPEALS
DISTRICT
I
Duane P. Reusch, Laura K. Reusch,
Karen M. Newton and
Roger A. Newton,
Plaintiffs-Respondents,
v.
Mark W.
Roob,
Defendant-Appellant.
APPEAL from a judgment and an order of
the circuit court for Milwaukee County: MICHAEL G. MALMSTADT, Judge.
Affirmed in part; reversed in part and cause remanded with directions.
Before Wedemeyer, P.J., Fine and Curley, JJ.
¶1. WEDEMEYER, P.J.Mark W. Roob appeals from a money judgment entered
in favor of Duane P. Reusch, Laura K. Reusch, Karen M. Newton and Roger A. Newton
(Reusch) and from an order awarding costs and reasonable attorney's fees.
¶2. Roob's appellate claims may be summarized as follows. The trial court
erred as a matter of law in concluding: (1)that his relationship with the Reusches was a
consumer approval transaction under Wis. Stat. §423.201 (1997-98)1 or a home solicitation under Wis. Admin. Code
§ATCP 127.01; (2)that the evidence was sufficient to establish that he violated certain
provisions of Wis. Admin. Code §ATCP 127; (3)that he committed an unfair trade
practice under Wis. Stat. §100.20; and (4)that damages in excess of $5,000, the small
claims limitation, should be awarded. We conclude that Roob's relationship with the
Reusches was not a consumer approval transaction or a home solicitation under Wis. Admin.
Code §ATCP 127.01; however, we also conclude that the trial court did not err in
determining that Roob committed an unfair trade practice. We remand the matter to the trial
court for a determination of what pecuniary loss, if any, flowed from the unfair trade
practice. Further, we conclude that an award of costs and attorney's fees in excess of the
$5,000 small claims limitation is not improper. Accordingly, we affirm in part, reverse in
part and remand the case for consideration of the damage issue.
I.BACKGROUND
¶3. This appeal involves a dispute arising from a contractual relationship
between a bride and groom on one side and Mark Roob, a commercial wedding
photographer, on the other side. Mrs. Newton, the mother of the bride (on behalf of Laura
and her fiancé, Duane), called Roob and requested that he provide his photographic
services for her daughter's wedding. Roob conducted his photography business from two
locations. His photography studio was located at 11625 West Bluemound Road, Wauwatosa,
while his business office was located at 1524 Upper Parkway South in his Wauwatosa
residence. Mrs. Newton met with Roob at the Upper Parkway South address on September
9, 1995, and conferred with him by phone the following day. Roob had not solicited the
business. A purchase contract was signed by Laura, Duane and Mrs. Newton on May 28,
1996, at the Upper Parkway South address. By terms of the agreement, Roob would provide
his services as a photographer for a fixed fee, as well as eighty five-by-seven prints and one
hundred five-by-five prints. Additionally, the Newtons and the Reusches were obligated to
purchase an album to be selected later from Roob for a separate charge determined by a rate
sheet that Roob supplied. Excluding the charge for the album and additional pictures, the
cost to the Newtons and the Reusches was $2,455.20, which they paid.
¶4. Laura and Duane were married on October 19, 1996. Roob performed his
services. There is no dispute about the quality of the photography. To facilitate the
obligation to purchase a wedding album, the contract also provided for a "design
session" to take place after the wedding, at which time the quantity of pictures and the
type of album were to be selected. The "design session" occurred on November
11, 1996, at the Upper Parkway South address. The meeting lasted over five hours during
which Roob prevailed upon Laura and Duane to commit to an extra $2,666.82 for additional
pictures and the album, as evidenced by signed invoice orders of the same date. The
following day, Roob visited Duane at his place of employment and obtained a check from
him for $500 as a down payment on the additional purchase price. Later the same day,
Laura and Duane had second thoughts about their additional purchases. With the assistance
of Laura's parents, they drafted a letter to Roob informing him to stop all work being
performed on the May 28, 1996 contract, and terminate the invoice orders signed November
11, 1996. The basis for their action, as stated in the notice, was a failure to arrive at
"a meeting of the minds" over the selection of pictures and an album pursuant to
paragraph 13 of the contract. On November 13, Duane hand delivered the notice to Roob at
the Upper Parkway South address. The check for $500 was never deposited by Roob and, in
fact, a stop payment order had been executed against the check.
¶5. The Reusches and the Newtons filed a small claims complaint against Roob,
alleging breach of contract and a violation of the Wisconsin Consumer Act, Chapter 423,
seeking all the remedies and penalties set forth in Wis. Stat. ch. 425. Roob appeared
pro se. Trial was to the court, and under the less than exacting procedures of a
small claims trial, the trial court patiently extended itself in attempting to settle the case, but
to no avail. At the conclusion of the evidence, the trial court granted the Reusches' motion
to amend the pleadings for a claim in replevin to conform to the proofs of record.
¶6. The court rendered a written decision. It concluded that two contracts
existed: a contract dated May 28, 1996, to which the Reusches and Mrs. Newton were
parties with Roob, and a contract dated November 11, to which only Laura and Duane were
parties with Roob. It concluded that the November 11, 1996, transaction of ordering the
album and additional pictures was conducted away from Roob's regular place of business.
Thus, the trial court found that Roob violated the Wisconsin Consumer Act for failing to
provide the plaintiffs with notice of their right to rescind their contract within three business
days of the transaction as provided by Wis. Stat. §§423.202 and 423.203, and
again violated the Wisconsin Consumer Act by failing to accept the Reusches' timely
termination of the November 11, 1996 order/invoice contract. Finally, the court concluded
that Roob engaged in unfair trade practices under Wis. Admin. Code §ATCP 127, and
Wis. Stat. §§100.20(5) and 100.20(lt), by withholding the printing of the initial
order of eighty photographs, which was a service within his control, in order to enforce his
claim for payment of the additional photographs, thereby entitling the Reusches to recover
twice the amount of their loss, plus reasonable attorney's fees. We conclude that the trial
court correctly concluded that Roob engaged in an unfair trade practice, but not for all of the
reasons stated. Further, we conclude a remand to the trial court is necessary for a resolution
of the pecuniary loss issue.
II.ANALYSIS
1.Nature of Contract.
¶7. We first address the nature of the contractual relationship that is the genesis
for this dispute. After a bench trial, the trial court found that two contractual relationships
were created: the first one on May 28, 1996, between Roob, Duane, Laura and Mrs.
Newton; the second on November 11, 1996, signed by the same parties with the exception of
Mrs. Newton. We disagree with this conclusion.
¶8. In reviewing findings of fact, we determine whether the trial court's findings
are clearly erroneous. See Wis. Stat. §805.17(2). Under this standard,
even though the evidence would permit a contrary finding, findings of fact will be affirmed
on appeal as long as the evidence would permit a reasonable person to make the same
finding. See Noll v. Dimiceli's, Inc., 115 Wis. 2d 641, 643, 340
N.W.2d 575 (Ct. App. 1983). Here, the evidence leads to only one reasonable conclusion:
one contract existed.
¶9. The pre-printed contract order form clearly sets forth that Roob is the
photographic service provider, and inserted in bold print are the names of
"Duane" Paul Reusch and "Laura" Kristine Newton as groom and
bride co-contractees. On the signature lines, however, appear M. Roob, Laura K. Newton,
Duane Reusch and Karen Newton. There is little doubt that Mrs. Newton acted on behalf of
the bride and groom to obtain Roob's services. As part of the contract in paragraphs 12 and
13, the contractees were required to purchase an album from Roob at additional cost, and
select the contracted-for prints. This requirement was to be fulfilled within thirty days at a
prearranged "design session." The manner and method by which this
requirement was to be fulfilled is the tempest in this legal teapot. Although there are three
contractees who signed the purchase contract, one of them, Mrs. Newton, was not present
when the album was ordered. We deem this fortuity of no consequence because there was
but one contract that was executed, even though it had two separate order provisions, the
latter of which, and the circumstances under which it was executed, are determinative of this
appeal.
2.Application of Wis. Stat. §423.01 and Wis. Admin. Code §ATCP
127.01.
¶10. We next examine the trial court's application of Wis. Stat. §423.01,
and Wis. Admin. Code §ATCP 127.01 to the evidence of record. Because the facts
relevant to the application of these statutory provisions are essentially not in dispute, the
issue is whether the trial court properly applied the statute and code provision. Whether a
particular statute applies to undisputed facts is a question of law that we review
independently. See Changv. State Farm Mut. Auto. Ins. Co., 182 Wis.
2d 549, 560, 514 N.W.2d 399 (1994); Bantz v. Montgomery Estates,
Inc., 163 Wis. 2d 973, 978, 473 N.W.2d 506 (Ct. App. 1991) (application of a
law or statute to a set of undisputed facts is resolved as a matter of law).
¶11. For a consumer, here the Reusches, to receive the benefits and protection
of Chapters 421 to 427, the transaction involving the consumer must fit the definition
contained in Wis. Stat. §423.201, which provides:
"Consumer approval transaction" means a
consumer transaction other than a sale or lease or listing for sale of real property or a sale of
goods at auction 1) which is initiated by face-to-face solicitation away from a regular place of
business of the merchant or by mail or telephone solicitation directed to the particular
customer and 2) which is consummated or in which the customer's offer to contract or other
writing evidencing the transaction is received by the merchant away from a regular place of
business of the merchant and involves the extension of credit or is a cash transaction in
which the amount the customer pays exceeds $25. "Consumer approval
transaction" shall in no event include a catalog sale which is not accompanied by any
other solicitation or a consumer loan conducted and consummated entirely by mail.
¶12. Relevant to our analysis, Wis. Stat.
§423.201 requires a "transaction ... initiated by face-to-face solicitation
away from a regular place of business of the merchant ... and ... which is
consummated ... by the merchant away from a regular place of business of the
merchant." (emphasis added). If the evidence demonstrates those facts, then
Wis. Stat. §§423.202 and 423.203 require the merchant to provide the buyer
with notice of his or her right to rescind the contract within three business days of the
transaction.
¶13. For the Reusches to receive the benefits and protection of Wis. Admin.
Code §ATCP 127.01, and consequently, Wis. Stat. §100.20(5), the sale must fit
the statutory definition of a "home solicitation sale."
¶14. Wisconsin Admin. Code §ATCP 127.01 (1997) provides, in
part:
Home solicitation selling means ... the offering for sale ...
services primarily for personal ... purposes ... where the sale ... is either personally solicited
or consummated by a seller at the residence ... of the buyer ... at a seller's transient
quarters, or away from the seller's place of business. Personal solicitation includes
solicitation made directly or indirectly by telephone ... other than general advertising
indicating a clear intent to sell goods at a regular place of business.
¶15. Such a sale, as relevant to our analysis, is a
sale "either personally solicited or consummated by a seller at the residence ... of
the buyer ... at a seller's transient quarters, or away from the seller's place of
business." Wis. Admin. Code §ATCP 127.01 (emphasis added).
¶16. From this review, it is clear that to acquire the protection and benefits of
the two legislative provisions, it is essential that the solicitation or consummation of a sale
must occur away from "a regular place of business" pursuant to Wis. Stat.
§423.201, and similarly "away from the seller's place of business"
pursuant to Wis. Admin. Code §ATCP 127.01. Without the fulfillment of either
criterion, the buyer is afforded no protection under these particular provisions and,
correlatively, the seller is not subject to sanctions. Indeed, the quick eye will notice the
difference between the indefinite article "a" in the statute and the definite article
"the" in the code provision; however, for a basic reason set forth later in this
opinion, the grammatical distinction is of no consequence.
¶17. When considering statutory construction, our obligation in plumbing
legislative intent is to first examine the language of the statute or the regulation authorized by
statute. See State v. Kruzicki, 209 Wis. 2d 112, 114, 561 N.W.2d 729
(1997). If clarity and common sense are reasonably evident, our inquiry ought end.
See P.A.K. v. State, 119 Wis. 2d 871, 878, 350 N.W.2d 677 (1984) (If
the meaning of a statute is clear on its face, we will not look outside the statute.). The statute
and administrative code provision at the heart of this dispute do not restrict the ability of a
merchant or seller to have more than one regular "place of business." Nor is
there any legislative history to support such a conclusion. We acknowledge that banks,
insurance agencies and real estate firms are specifically excluded from coverage under the
statute. However, to thereby preclude every other form of commercial activity involving
solicitation for goods and services from having more than one regular "place of
business," is reading into the statute and regulation language that currently does not
exist and for which no evident legislative policy basis can be ascertained.
¶18. The trial court determined that because both the May 28, 1996, and
November 11, 1996 agreements, were executed at Roob's residence, the setting was not a
regular place of business. For several reasons, we conclude that these findings are clearly
erroneous. See Noll, 115 Wis. 2d at 643.
¶19. The telephone number of Mark Roob Photographic Design Group is
476-8500, located at 1524 Upper Parkway South. Mrs. Newton called that number, solicited
Roob's services, and made an appointment with him to conduct business at that residence.
The contract was executed on May 28, 1996, at the same address. The printed address on
the contract form shows the same address. The "Exquisite Wedding Coverage"
information sheet distributed by Roob sets forth the same telephone number and address.
The four order/invoice slips received in evidence list the same address. Roob's Wisconsin
Department of Revenue Seller's Permit authorizes him to engage in selling services at 1524
Upper Parkway South, and obligated him to conspicuously display the permit at the place of
business for which it is issued. The Reusches' termination notice was directed to the same
address as was a follow-up notice dated November18, 1996. In light of this overwhelming
evidence, the trial court's determination that Roob did not use his residence as a regular or
as an alternate regular place of business, was clearly erroneous. For the very same
evidentiary reasons, we conclude that it was clearly erroneous to rule that this business
activity was a "home solicitation" sale as defined in Wis. Admin. Code
§ATCP 127.
¶20. In concluding that the Wisconsin Consumer Act applied to the contractual
relationship between the Reusches and Roob, the trial court and the respondents in their
brief, proffer foreign jurisdiction decisions as persuasive authority to support their positions.
See Bruntaeger v. Zeller, 515 A.2d 123 (Vt. 1986); R. Bauer
& Sons Roofing & Siding, Inc. v. Kinderman, 613 N.E.2d 1083
(Ohio Ct. App. 1992) and Burke v. Yingling, 666 A.2d 288 (Pa. Super.
Ct. 1995). All are well-written decisions, but the issues decided therein are not on "all
fours" with the issues presently before us. Consequently, we conclude that these
decisions fail to persuade.2
¶21. For these reasons, we conclude that Roob's activity at his alternate regular
place of business at Upper Parkway South, under the facts, is not subject to sanction under
Wis. Stat. §423.201, or Wis. Admin. Code §ATCP 127.01.
3.Violation of Wis. Stat. §100.18(5).
¶22. Roob next claims that the trial court erred in finding that he did not display
a conspicuous sign in the "sales room" portion of his residence, which constituted
a violation under Wis. Stat. §100.18(5).3 Roob argues that the presence of his Wisconsin
seller's permit on a piece of furniture satisfies this requirement. We disagree. The trial
court had an opportunity to examine the seller's permit and hear the evidence relating to
where the paper permit was located in the display room where the "design
session" took place. It determined that the manner and method in which the permit
was exhibited was not evident enough to be "conspicuous." We cannot conclude
that the trial court was clearly in error in arriving at this determination. Thus, we reject
Roob's claim in this regard.
¶23. Our conclusion notwithstanding, a plain reading of Wis. Stat.
§100.18(11)(b), requires proof of pecuniary loss because of any violation of
§100.18. We have found no proof in the record of pecuniary damages resulting from
this sign violation and therefore reject any damages claim based upon a §100.18(5)
violation.
4.Unfair Trade Practice under Wis. Stat. §100.20.
¶24. Next, Roob claims that the trial court erred when it concluded that Roob
committed an unfair trade practice in violation of Wis. Stat. §100.20(lt). The trial
court found that Roob "used such high pressure sales tactics at the November11 design
session, e.g. his efforts to divide Laura and Duane and his alleged artistic license in
designing the album, which finally induced Laura and Duane to purchase more
photos." The court further found that Roob withheld the eighty wedding pictures in an
effort to enforce his claim for payment of additional photographs. The trial court found
Roob's actions to be "unconscionable" and this formed the basis for its
conclusion that Roob engaged in an unfair trade practice in violation of
§100.20(lt).
¶25. Wisconsin Stat. §100.20, "Methods of Competition and Trade
Practices" is also known as Wisconsin's Little Fair Trade Commission Act. See
JamesK. Matson, Unfair and Deceptive Business Practices: Private Remedies for
Consumers and Competitors, Jan. 1980 Wisconsin Bar Bulletin 14. It was adopted in
1921 and created to be the mirror image of the Federal Trade Commission Act. See
id. In both broad and specific terms, it prohibits unfair methods of competition
and unfair trade practices. See id. To effectuate its goals, it authorizes
the Department of Agriculture, Trade and Consumer Protection, after hearings, to adopt
general rules and individualized special orders prohibiting business practices that it
determines to be unfair, and, at the same time, setting forth fair practices. See
id. The purpose of the statute is multi-fold in nature: promoting free and open
competition in the marketplace among competing merchants, protecting small businesses
from anti-competitive acts or practices, and, finally, protecting consumers. See
id.
¶26. Wisconsin Stat. §100.20(lt) reads: "It is an unfair trade
practice for a person to provide any service which the person has the ability to withhold that
facilitates or promotes an unfair method of competition in business, an unfair trade practice
in business, or any other activity which is a violation of this chapter."4
¶27. Contained in the statute is a private remedy available to any person
sustaining a pecuniary loss resulting from unfair competitive or trade practices. Specifically,
the subsection reads: "Any person suffering pecuniary loss because of a violation by
any other person of any order issued under this section may sue for damages therefor in any
court of competent jurisdiction and shall recover twice the amount of such pecuniary loss,
together with costs, including a reasonable attorney's fee." Wis. Stat.
§100.20(5).
¶28. As to be expected, Roob's version of what occurred at the "design
session" differs from that presented to the court by the Reusches. He contends that,
prior to the start of litigation, the Reusches never alleged that he ever threatened to withhold
photographs or services unless the Reusches purchased photographs in addition to what was
required by the contract. From a reading of the record, we concede that different reasonable
inferences could be drawn from the same evidence but, absent a clearly erroneous finding,
there is a limit to our reviewing authority. We are obligated to accept the inference drawn
by the fact finder, when there is a reasonable basis in the record. See State v.
Friday, 147 Wis. 2d 359, 370-71, 434 N.W.2d 85 (1989). It is for the finder
of fact to assess credibility and assign probative value to the contradictory version of events
as presented by the evidence. See Gehr v. City of Sheboygan, 81 Wis.
2d 117, 122, 260 N.W.2d 30 (1977). The court heard that Duane did not want any duplicate
or near duplicate pictures. For that matter, he did not want any more than the eighty
pictures and the one hundred proofs for which he had already paid. But, Roob kept insisting
more pictures were needed to tell the complete story of the wedding. According to Duane, on
the basis of Roob's selection process, eighty pictures "only got them half way down the
aisle." Duane asserts that during the five hour "design session" Roob
"played him off against his wife" in selecting pictures and, at one point, accused
him of being rude. Finally, as the design session was drawing to a close at about 11:30
p.m., Duane testified that Roob insisted they could not leave without signing purchase orders
for additional pictures and albums. Duane contended that because he did not want to offend
his wife, he felt obliged to sign the additional orders just to be able to leave.
¶29. Laura testified that the selection process had reduced the number of
pictures and/or prints from 262 to 180. She described how Roob organized the pictures by
pages that were laid out on the floor. Laura told Roob they did not want that many pictures.
Both she and Duane started eliminating pictures. When this occurred, Roob became upset
and began rearranging the pictures without any reduction in the number. Pictures remained
that she did not want. In short, their efforts were met with resistance.
¶30. In addition, two letters from Roob addressed to the Reusches and dated
subsequent to the "design session" were received into evidence. The letters were
in response to the cancellation notice and its effect. Although the content of each letter is
rather ambiguous, it would not be unreasonable for the trial court to equate them as a subtle
effort on Roob's part to apply pressure on the couple to make additional
purchases.5 Regardless, it is
obvious from the written memorandum decision that the trial court placed more weight and
credence in the version of events presented by the Reusches. The trial court's findings are
not unreasonable and its conclusion that an unfair trade practice occurred has a basis in the
record. Accordingly, we affirm that determination.
4.Damages.
¶31. Finally, we are left with the damages question, which is two-fold. First,
what pecuniary damages, if any, flowed from the violation of the unfair trade practice.
Second, can the trial court's award of costs and attorney's fees in a small claims case exceed
the $5,000 limitation. We address each in turn.
¶32. As noted above, we have affirmed the trial court's determination that Roob
committed an unfair trade practice relating to the design session and the threat to withhold
the wedding photos. If Roob retains the photos, the Reusches are clearly entitled to the
value of the photos and this amount constitutes a pecuniary loss flowing from the unfair trade
practice. If, however, the Reusches receive the wedding photos that they bargained for
under the first part of the contract, they cannot also recover all the money paid under that
portion of the contract, and there does not appear to be any pecuniary loss. We cannot
resolve this factual matter and therefore remand this matter to the trial court to determine
what amount of pecuniary damages, if any, resulted from Roob's unfair trade
practice. 6
¶33. The second damage question involves the $5,000 small claims limitation.
We conclude that the limitation applies to the pecuniary loss, but not to the costs and
reasonable attorney's fees associated with that loss. Because we have remanded the first
damage question to the trial court, this portion of the decision may or may not apply in this
case. We address the issue, nonetheless, because this is an issue that is likely to recur in the
future.
¶34. The trial court awarded a money judgment of $4,910.40 and costs and
reasonable attorney's fees of $13,474.95. Roob argues that the combination of these two
awards, which exceeds the $5,000 jurisdictional limit for small claims under Wis. Stat.
§799.01, rendered the trial court without competency to handle this matter. We are
not convinced.
¶35. Roob takes issue with the award of attorney's fees, which he argues
unlawfully pushes the total damages over the $5,000 cap. Relying on DeChant v.
Monarch Life Insurance Co., 200 Wis. 2d 559, 547 N.W.2d
592 (1996), he argues that because the attorney's fees awarded here are a statutory creature,
they are to be treated as an element of compensatory damage rather than as a taxable cost.
Roob's reading of DeChant is too broad. In DeChant,
Monarch Life acted in bad faith when it refused to provide DeChant with benefits to which
he was entitled under his disability insurance policy. See id. at 577.
DeChant claimed he was entitled to actual attorney's fees because he was forced to retain an
attorney to obtain the benefits owed under his policy, but which were withheld in bad faith.
See id. at 574. Monarch replied that the recovery of attorney's fees was
foreclosed by the American Rule that parties to litigation are generally responsible for their
own attorney's fees unless recovery is expressly allowed by either contract or statute.
See id. at 575. Our supreme court ruled that because the claim for fees
was for an economic loss proximately caused by the tort, there could be recovery. See
id. at 575-77. In reaching its decision, however, the court recognized the
subtle but significant difference between attorney's fees attributable to bringing a lawsuit and
those recoverable as damages resulting from a tort. See id. The former
is intended to compensate the attorneys, whereas the latter is intended to compensate the
victims. See id. Thus, contrary to Roob's assertion, statutorily
authorized attorney's fees are not to be considered part of the pecuniary loss/damage
award.
¶36. Under our general consumer protection statutes, Wis. Stat.
§425.308(1) and (2),7
provide for the awarding of reasonable attorney's fees sufficient to compensate attorneys to
represent consumers in actions arising from consumer transactions. There can be little doubt
that these authorized fees are intended for attorneys to assist in the private prosecution of
consumer law violations. The same partially parallel purpose of Wis. Stat. §100.20
persuades us to conclude that the reasonable attorney's fees provision is also intended to
compensate attorneys and, therefore, it cannot be labeled an element of damages included in
the pecuniary loss award.
¶37. In small claims cases, an award of attorney's fees is limited to the amount
recoverable under Wis. Stat. §814.04(1) and (6), "except if the amount of
attorney fees is otherwise specified by statute." Wis. Stat. §799.25(10). Here,
attorney's fees were ordered under Wis. Stat. §100.20(5). The reasonableness of the
attorney's fees was left unchallenged at the trial court level. Because the statute authorizes
an award of attorney's fees in this case, and this portion of the damage award is separate
from the pecuniary loss due to its intent to compensate the attorney rather than the Reusches,
it does not violate the $5,000 small claims court limitation, and Roob's last claim of error
fails.
¶38. In sum, we conclude that the trial court did not err in finding that Roob
engaged in an unfair trade practice. We remand the matter to the trial court for a
determination as to what pecuniary loss, if any, flowed from Roob's conduct. If the trial
court determines the Reusches did suffer a pecuniary loss, the trial court is directed to
reinstate the award for costs and attorney's fees because such award does not violate the
$5,000 small claims damage limitation.
By the Court.-Judgment and order affirmed in part; reversed in part and
cause remanded with directions.
Recommended for publication in the official reports.
1 All references to the Wisconsin Statutes will be to the 1997-98 version unless otherwise
noted.
2 The trial court found Bruntaeger v. Zeller, 515 A.2d 123 (Vt. 1986)
persuasive. From our review of the record and the court's written decision, we are uncertain
why the court was so persuaded. Bruntaeger purchased a fur coat from Zeller at his
temporary business location in a motel. See id. at 124. When the coat
appeared to be defective, among other complaints, Bruntaeger alleged that the sale of the
coat was a "home solicitation" and, therefore, under the State of Vermont statute,
she was entitled to a written notice of her cancellation rights. See id.
The applicable Vermont statute defined a "home solicitation" sale as one solicited
or consummated by a seller at the residence of the buyer or at a seller's transient quarters,
which includes a motel room. See id. at 125. It is quite clear that the
statute included any place utilized as a temporary business location. See
id. The resolution of that issue under the evidence presented was determinative
of the appeal. Here the issues are different.
In R. Bauer & Sons Roofing & Siding, Inc. v.
Kinderman, 613 N.E.2d 1083 (Ohio Ct. App. 1992), Kinderman contacted
Bauer by telephone requesting an estimate for a new roof and window replacements.
See id. at 1084. Bauer's salesperson visited Kinderman's residence
several times before the remodeling contract was signed. See id. The
contract did not contain a three-day cancellation clause. See id.
Kinderman was not satisfied with the installation of the windows, refused to pay the balance
due on the total contract cost, and sent Bauer a notice of cancellation. See
id. at 1085. Bauer sued to recover and Kinderman counterclaimed alleging that
the sale was a "home solicitation" sale that required notification of a three-day
cancellation right. See id. Two issues were presented for review: (1)
whether the Home Solicitation Sale Act applied to home improvement products and services;
and (2) whether the protection of the act did not apply to Kinderman because Bauer's activity
was excluded from the act in that the buyer initiated the contact for negotiating a purchase
and the seller has a business establishment at a fixed location in the state where the goods
and services involved in the transaction are regularly offered or exhibited for sale. See
id. at 1086. The answer to the first issue was affirmative. See
id. at 1087. As to the second issue, however, its resolution was more complex.
The exclusion required the presence of conjunctive circumstances. Under the facts, doubtless
the buyer initiated contact and Bauer had a business establishment at a fixed location in the
state. The court then defined the issues for resolution: "(1) whether a seller must
exhibit the exact product ultimately purchased by the buyer; and (2) whether a service can be
regularly exhibited for sale at a fixed location." Id. at 1089. The
court declared a two-pronged response.
When the buyer contacts the seller and requests that the seller
come to his or her home to negotiate the sale of a product which the buyer could have
purchased at the seller's place of business, the buyer is no longer subject to the evils against
which the Act is designed to protect.
We conclude that the purposes of the Act are effectuated when a business exhibits,
at a fixed location in this state, a sample of the product, which the buyer wishes to purchase.
Merely because the seller must order a larger number or different size of the sample item to
accommodate the customer does not defeat the logic of the exception. To hold otherwise
would require a seller to keep in stock every conceivable color, size, and permutation of the
goods in which it deals. We do not believe that the legislature intended such an absurd
result.
Id. at 1090.
Contrary to the respected trial court's analysis, Bauer supports
Roob's position because the record stands uncontroverted that he had readily visible examples
of the services and product that he was selling: photographs on the walls, containers of
photos and examples of albums.
In Burke v. Yingling, 666 A.2d 288 (Pa. Super. Ct. 1995), the
Pennsylvania Superior Court was asked to exclude a buyer solicited, customized audio video
system contract from the protection of the state's Unfair Trade Practices and Consumer
Protection Law. The contract was executed in the buyer's home. See id.
at 289. The contract did not contain a three-day cancellation provision as required.
See id. The issue presented to the court was whether the statutory
language, i.e., makes a contact with, or call on, the buyer at his residence, protects all such
buyers regardless of how the contractual relationship was initiated or, as in this case, how
sophisticated the buyer was. See id. at 291. The court opined that even
though the nature of the evidence rationally dictated an opposite conclusion, because the
statutory language afforded protection to all such buyers, there was no basis to formulate an
exception. See id. Because the instant record does not contain any
finding or basis for a reasonable inference to be drawn that there was any connection with
the purchasers' residence, we fail to see the application of this decision.
The trial court cited language of the Pennsylvania court that was written in response
to the attorney general's amicus brief urging the trial court to adopt a balancing test in
applying the statute of the right to cancel: "[t]he legislature has used clear language. In
doing so, the legislature did not exclude transactions where negotiations occurred, or where
the initial contact was made by the buyer, or even where a consideration of all the foregoing
factors argued against application of section 201-7," id. at 292. The
statement was based on the specific language of the Pennsylvania statute and, therefore, we
accord it no persuasive value.
3 Wisconsin Stat. §100.18(5) provides:
Any person, firm, corporation or association engaged in any
business mentioned in sub. (3), or in any other kind of business, whether conducting such
business in a store, business block, residence or other building, shall at all times keep a
conspicuous sign posted on the outside of his or her establishment and another conspicuous
sign in the salesroom, which sign shall clearly state the name of the association, corporation
or individual who actually owns said merchandise, property or service which is being offered
to the public and not the name of any other person; provided, however, that the exterior sign
shall not be required where the seller has no control over the exterior of the premises where
such business is conducted.
4 Although the parties were able to ascertain the meaning of this statute, we conclude that
the statute would make more sense if the words "provide" and
"withhold" were transposed. We encourage the legislature to consider revision to
the wording of this statute.
5 In reaching its decision in this case, the trial court impliedly found that Roob's threatening
letters usurped the earlier cancellation letter of the Reusches. This finding is reasonable
given the timing and content of Roob's letters, which occurred after the cancellation letter,
and indicated that the Reusches' only alternative to accepting what was selected at the design
session was "a la carte" prices.
6 We also note that although we have affirmed the trial court's finding that Roob's conduct
constituted an unfair trade practice, this ruling does not void the contract because no
violation occurred under Chapter 423 or ATCP 127. Accordingly, upon remand, the trial
court should not include the negatives in any damage award as the Reusches do not have a
contractual claim to these items, and the negatives do not constitute a loss flowing from the
unfair trade practice.
7 Wisconsin Stat. §§425.308(1) and (2) provide:
(1)If the customer prevails in an action arising from a
consumer transaction, the customer shall recover the aggregate amount of costs and expenses
determined by the court to have been reasonably incurred on the customer's behalf in
connection with the prosecution or defense of such action, together with a reasonable amount
for attorney fees.
(2)The award of attorney fees shall be in an amount sufficient to compensate
attorneys representing customers in actions arising from consumer transactions. In
determining the amount of the fee, the court may consider:
(a)The time and labor required, the novelty and difficulty of the questions involved
and the skill requisite properly to conduct the cause;
(b)The customary charges of the bar for similar services;
(c)The amount involved in the controversy and the benefits resulting to the client or
clients from the services;
(d)The contingency or the certainty of the compensation;
(e)The character of the employment, whether casual or for an established and
constant client; and
(f)The amount of the costs and expenses reasonably advanced by the attorney in the
prosecution or defense of the action.
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