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    Wisconsin Lawyer
    September 01, 1997

    Wisconsin Lawyer September 1997: Supreme Court Digest

    Supreme Court Digest

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

    | Civil Procedure | Constitutional Law | Corrections | Criminal Procedure | Insurance | Public Benefits | Taxation | Torts |


    Civil procedure

    Excluding Expert Evidence - Surprise - Probative Value

    Magyar v. WHCLIP, No. 95-0972 (filed 27 June 1997)

    The plaintiff brought a medical malpractice action against various defendants. On the first day of trial, the plaintiff and one defendant, NSM, asked the court to approve a settlement that dismissed NSM from the lawsuit. The settlement was, however, contingent upon the court's ruling that a certain expert named only by NSM could not be called by any other defendant. The judge approved the settlement over the objection of the nonsettling defendants. The court of appeals affirmed.

    The supreme court, in an opinion written by Justice Bablitch, reversed. The trial judge properly concluded that the plaintiff was not unduly surprised by the expert's testimony, which had "significant" probative value. Nor was the testimony in any way "unfairly" prejudicial. The supreme court held that the trial judge abused his discretion by excluding the evidence based on "the equities to the settling defendant."

    Chief Justice Abrahamson concurred, writing separately to suggest that the court might have to reconsider prior cases that "injudiciously read unfair surprise into sec. 904.03." Justice Geske joined in the concurrence.

    Justice Geske also filed a concurring opinion that addressed why the circuit court erroneously considered the "equity" of the dismissal.

    Offers to Settle - Interest - Insurer's Limits

    Nelson v. McLaughlin, No. 95-3391 (filed 2 July 1997)

    The plaintiff sued an insured defendant and his insurer for damages resulting from a car accident. Prior to trial, the plaintiff offered to settle for the $100,000 policy limits but the offer was rejected. A jury awarded about $500,000 in damages. Section 807.01(4) of the Wisconsin Statutes provides that the plaintiff is entitled to 12 percent interest on the amount recovered from the date of the offer of settlement to the date of payment. The circuit court imposed on the insurer the interest rate on the entire verdict rather than the insurer's policy limits ($500,000 versus $100,000). The court of appeals reversed.

    The supreme court, in an opinion written by Justice Crooks, affirmed the court of appeals. The insurer was responsible for the 12 percent interest on only its $100,000 policy limits. This conclusion followed from "(1) the legislature's choice of the phrase 'amount recovered' instead of 'verdict' or 'judgment' in sec. 807.01(4); and (2) the fact that if 'amount recovered' is interpreted to mean the entire verdict, insurers will be forced to settle cases that would be more appropriately resolved at trial." Insurers will not deny settlements contrary to the best interests of their insureds "because the availability of a bad faith claim provides substantial deterrent against insurers engaging in such practices." Finally, the court recognized that an insurer can be bound to pay interest on the entire verdict under the terms of its insurance contract, but the insurer in this case was not contractually so obligated.

    Chief Justice Abrahamson dissented, joined by justices Bablitch and Bradley. The dissent maintains that "when an insurance company has the sole right and ability to settle an entire litigation, yet rejects on behalf of itself and its insured a plaintiff's offer made pursuant to Wis. Stats. Sec. 807.04(1) to settle for an amount within the policy limits and the plaintiff subsequently recovers a total judgment greater than or equal to the amount offered, the insurer is responsible for penalty interest" on the entire amount recovered against both insured and insurer.

    Constitutional law

    Qualified Immunity - Clearly Established Rights

    Penterman v. WEPCO, No. 96-0164 (filed 2 July 1997)

    Plaintiffs claimed that their farm operations suffered because of "stray voltage" from WEPCO's power lines. They also sued a state employee, Dasho, who headed the Wisconsin Public Service Commission's Stray Voltage Analysis Team. The circuit court dismissed the action against Dasho in part because he was entitled to qualified immunity. The court of appeals affirmed but did not reach the qualified immunity issue because it concluded that there was no legally cognizable claim against Dasho.

    The supreme court, in an opinion written by Justice Geske, affirmed. Although the case presented "unique legal claims," the court concluded that plaintiffs failed to show that Dasho violated a "clearly established constitutional right." Thus, Dasho was entitled to qualified immunity and the court declined to consider whether the plaintiffs stated a claim for which relief could be granted. Justice Geske cautioned that the opinion made "no new law" and that the court's "qualified immunity inquiry is fact-specific, limited to the facts alleged in the pleadings." Readers interested in the particular facts should review the court's opinion.

    Corrections

    County Jails - Authority of Dept. of Corrections to Place Probation and Parole Violators in County Jails Over Sheriff's Objection

    Wisconsin Dept. of Corrections v. Kliesmet, No. 96-2292 (filed 25 June 1997)

    The key issue in this case is whether the Wisconsin Dept. of Corrections (DOC) can place its probation and parole violators in a county jail over the safety objections of the sheriff. At its core the case presented a question of statutory interpretation involving section 302.31 of the Wisconsin Statutes, which provides that "the county jail may be used ... for the temporary detention of persons in the custody of the department [of corrections]."

    In a unanimous decision authored by Justice Bradley, the court concluded that the Legislature intended by section 302.31 to grant the DOC discretion to keep alleged violators of probation or parole in county jails. However, considering the statutory and common law authority establishing a sheriff's duty and authority to act in the interest of jail safety, the court also discerned a legislative intent to limit DOC's section 302.31 authority to those instances in which a sheriff determines that taking additional DOC detainees would result in such overcrowding as to constitute an unacceptable risk of harm to inmates, deputies and jail staff.

    In making this decision, the court indicated its awareness of the administrative difficulties that DOC faces in administering its probation and parole functions. However, in the absence of a clear directive to the contrary, the court refused to conclude that the Legislature intended that the DOC's authority to keep its detainees in the county jail should trump the sheriff's duty to maintain safety at the jail.

    Because of the need to give the Legislature sufficient time to address the administrative difficulties that DOC will face if it is unable to use county jails to house its detainees, the court delayed the effective date of the decision in this case for one year.

    Criminal procedure

    Search and Seizure - School Searches

    State v. Angelia D.B., No. 95-3104 (filed 20 June 1997)

    A high school student, Angelia, was charged with carrying a concealed weapon - a large knife found hidden in her clothes. The circuit court suppressed the knife and all evidence derived from the search based on the conclusion that it violated Angelia's constitutional rights. On certification from the court of appeals, the supreme court, in an opinion written by Justice Geske, reversed.

    Applying New Jersey v. T.L.O. (1985), the supreme court held that it was "permissible for school officials who have a reasonable suspicion that a student may be in possession of a dangerous weapon on school grounds to request the assistance of a school liaison officer or other law enforcement officials in conducting a further investigation." Recognizing that T.L.O. did not address this question, the court further concluded that "an application of the T.L.O. reasonable grounds standard, and not probable cause, to a search conducted by a school liaison officer at the request of and in conjunction with school officials of a student reasonably suspected of carrying a dangerous weapon on school grounds is consistent with both the special needs of public schools recognized in T.L.O. and with decisions by courts in other jurisdictions."

    On the record before it, the court found that the search was both reasonable at its inception and was conducted in a way that was "reasonably related in scope to the circumstances justifying the interference in the first instance."

    Chief Justice Abrahamson, joined by Justice Bradley, concurred. They agreed that the search was legal because it was supported by probable cause; thus, the majority did not have to "reach out to adopt a new lower standard to support the search."

    Right to Counsel - Competency

    State v. Klessig, No. 95-1938-CR (filed 24 June 1997)

    Klessig was charged with burglary and bail jumping. After several lawyers withdrew their representation of him, with Klessig's blessing, Klessig notified the court that he would represent himself at the scheduled trial. The trial judge did not "engage in an on-the-record colloquy with the defendant concerning either the knowing or voluntary waiver of his right to counsel," nor did the judge inquire into the defendant's competency to represent himself and proceed pro se. A jury convicted him of burglary. The court of appeals affirmed.

    The supreme court, in an opinion written by Justice Wilcox, reversed and remanded the case for an evidentiary hearing to determine: a) whether there was a knowing, voluntary and intelligent waiver of the right to counsel; b) whether an adequate and meaningful nunc pro tunc hearing can be conducted on Klessig's competency to represent himself; and, if so, c) whether Klessig was competent. Overruling a prior case, the court held that circuit courts must conduct an "on-the-record colloquy to ensure that the defendant: "1) made a deliberate choice to proceed without counsel, 2) was aware of the difficulties and disadvantages of self-representation, 3) was aware of the seriousness of the charge or charges against him, and 4) was aware of the general range of penalties that could have been imposed on him." Absent such a record, no valid waiver can be found except through a meaningful nunc pro tunc hearing. The state must establish the validity of the waiver by clear and convincing evidence.

    The court also held that "[i]n Wisconsin, there is a higher standard for determining whether a defendant is competent to represent oneself than for determining whether a defendant is competent to stand trial. This higher standard ... stems from the independent adoption of the higher standard by the State as allowed under Godinez v. Moran, 509 U.S. 389 (1993)]."

    Chief Justice Abrahamson joined the majority's mandate but wrote separately to call attention to the possibility that the rule announced by the majority may be "irreconcilable" with Godinez.

    Sentencing - Setting Parole Eligibility Date
    Beyond Defendant's Anticipated Life Span

    State v. Setagord, No. 95-0207-CR

    State v. Downing, No. 96-1264-CR (filed 1 July 1997)

    Section 973.014(1)(b) of the Wisconsin Statutes provides that when a court sentences a person to life imprisonment, it shall make a parole eligibility determination regarding the person and may choose the option of providing that the person is eligible for parole on a date set by the court. If the judge exercises this option, he or she may set "any later date" than that provided in section 304.06(1) (the general parole eligibility statute), but may not set a date that occurs before the earliest possible parole eligibility date as calculated under section 304.06(1).

    For their roles in a hostage-taking (a Class A felony) and attempted jail break, the defendants received mandatory life sentences. Invoking section 973.014(1)(b), the judge set parole eligibility dates for each of them far beyond their respective anticipated life spans.

    Before the supreme court both defendants argued that the statute does not authorize the circuit court to effectively deny parole by setting a parole eligibility date beyond a defendant's anticipated lifetime. A majority of the supreme court, in a decision authored by Justice Geske, concluded that the statute unambiguously grants the circuit court discretion to impose a parole eligibility date beyond a defendant's expected life span. In so holding the majority rejected the argument that the statute commands that a realistic opportunity for parole be maintained in the setting of a parole eligibility date, and further held that the authority to impose a parole eligibility date beyond a defendant's expected lifetime does not violate the separation of powers doctrine. Finally, in the context of this case, it concluded that the circuit court did not erroneously exercise its discretion in setting parole eligibility dates.

    Justice Bablitch filed a dissenting opinion in which Chief Justice Abrahamson and Justice Bradley joined.

    Penalty Enhancer for Committing a Crime
    While Possessing a Dangerous Weapon -
    Nexus Requirement - Retroactivity of State v. Peete

    State v. Howard, No. 95-0770 (filed 26 June 1997)

    In State v. Peete, 185 Wis. 2d 4, 517 N.W.2d 149 (l994), the Wisconsin Supreme Court held that when a defendant is charged with the penalty enhancer of committing a crime while in possession of a dangerous weapon, section 939.63 of the Wisconsin Statutes requires the state to prove a nexus between the underlying crime and the possession of the weapon. Because this nexus is an element of the penalty enhancer, the jury must find the nexus element beyond a reasonable doubt.

    The defendant in this case was charged in 1989 with aiding and abetting the unlawful delivery of a controlled substance while possessing a dangerous weapon. At his trial in 1990 the jury received no instruction on the nexus requirement that was articulated four years later in Peete and it was not asked to make any specific finding on that element. After his direct appeals were exhausted and following the decision in Peete, the defendant requested post conviction relief pursuant to section 974.06 of the Wisconsin Statutes based upon the supreme court's holding in Peete. The circuit court denied the motion and the court of appeals reversed. The supreme court, in a unanimous decision authored by Justice Geske, affirmed the court of appeals.

    The supreme court concluded that the Peete holding applies to situations of actual as well as constructive possession (the present case involving actual possession). The court further had to determine whether the rule announced in Peete applies retroactively to cases on collateral review like the present one, and held that it does so apply.

    The court also had to deal with the state's position that the defendant's motion for section 974.06 relief was barred by the decision in State v. Escalona-Naranjo, 185 Wis. 2d 168, 5l7 N.W.2d 157 (1994). In that case the court interpreted section 974.06(4) to require that if a ground for relief was not raised in an original, supplemental or amended motion, the defendant has to show a sufficient reason why he or she did not assert that ground for relief earlier; otherwise the defendant's claim is barred. The court held that because the defendant in this case could not have foreseen the effect of Peete at the time of his original appeal, his motion for a new trial based on Peete is not barred by Escalona-Naranjo.

    Finally, the court considered and rejected the state's position that the failure to instruct the jury about the nexus requirement for the weapons enhancer was harmless error. The jurors in this case were precluded from considering whether the defendant possessed a dangerous weapon to facilitate the commission of the predicate crime. The absence of the nexus instruction thus rendered the conviction on the penalty enhancer fundamentally unfair.

    Evidentiary Privileges - Defense Discovery

    State v. Solberg, No. 95-0299-CR (filed 1 July 1997)

    The defendant appealed his conviction for third-degree sexual assault. He claimed that the circuit court should have granted him access to the victim's medical records, which may have revealed impeaching evidence. The court of appeals reversed the conviction and remanded for a determination of whether the victim had consented to the circuit court's in camera review of her medical and psychiatric records.

    The supreme court, in an opinion written by Justice Wilcox, reversed the court of appeals. First, the court held that trial courts "should conduct an in camera review of privileged medical records when the defendant makes a 'preliminary showing that the sought-after evidence is material to his or her defense,' and the privilege holder consents to review." In this case, the prosecutor conceded that the defense had made the required preliminary showing. The supreme court examined the sealed record in this case and found a written release that established the victim's consent to the review. (The court observed that the "better practice" is to have the circuit court interview the victim on the record and thereby make a determination of the victim's voluntary consent. Whatever procedure is used, the victim should be aware that he or she does not have to consent.)

    On the record before it, the court also held that the trial judge did not abuse his discretion in denying the defendant access following the in camera review. "If the circuit court determines that the records contain [material evidence], it should be disclosed to the defendant if the patient consents to such a disclosure. If the records do not contain relevant information material to the defense, the circuit court must not disclose the records to the defendant." Besides reviewing the records in camera, the trial judge also interviewed a doctor who treated the victim. The judge acted within his discretion when relying upon the doctor's opinion that despite occasional "flashbacks" the victim would have known the difference between fantasy and reality at all times. (The court also suggested that such ex parte interviews should be recorded.)

    Justice Bradley, joined by Chief Justice Abrahamson, concurred. They thought that the majority's approach invited a "piecemeal resolution" of "important, complex, and interrelated" issues. The court should have stopped after finding that the victim had consented to the review.

    Justice Bablitch dissented on the ground that plain error occurred when the trial judge failed to record his conversation with the victim's doctor.

    Insurance

    "Sick Building" - Pollution Exclusion

    Donaldson v. Urban Land Interests Inc., No. 95-3015 (filed 24 June 1997)

    In this "sick building" case, the plaintiffs alleged that an inadequate ventilation system caused an excessive accumulation of carbon dioxide in their work area resulting in various physical maladies. A defendant insurer was granted summary judgment based on its pollution exclusion. A divided court of appeals agreed that the pollution exclusion clause vitiated coverage for any damages.

    The supreme court, in an opinion written by Justice Bradley, reversed. The pollution exclusion clause in this policy was ambiguous; thus, the insured could reasonably expect coverage for the claims lodged against it. Exhaled carbon dioxide is "universally present and generally harmless in all but the most unusual instances." The court was "hesitant to conclude that a reasonable insured would necessarily view exhaled carbon dioxide as in the same class as 'smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.'"

    Justice Steinmetz dissented.

    Public Benefits

    Medical Assistance - Divestment - Failure to Claim Against Deceased "Community Spouse's" Estate

    Tannler v. Wisconsin Dept. of Health and Social Services, No. 96-0118 (filed 24 June 1997)

    The issue in this case was whether an institutionalized person's failure to assert a claim against his or her deceased "community spouse's" estate constitutes a divestment of assets under the Medical Assistance (MA) program. A "community spouse" is a person who is married to an institutionalized person but is not himself or herself an institutionalized person.

    Petitioner Tannler lives in a nursing home. She has received MA since early in 1993. Her husband died in 1994 leaving a will that bequeathed all of his assets, both real and personal property, to his grandson and his grandson's wife. He left nothing to the petitioner. The petitioner, represented by a guardian in the estate of her deceased husband, did not contest the will, nor did she file any elections or select any property passing under her husband's will.

    The petitioner continued to receive MA benefits until l995 when the Department of Health and Social Services (DHSS) informed her that it was terminating her eligibility. DHSS asserted that the petitioner's failure to contest, select or elect against her husband's will constituted a divestment of assets which rendered her ineligible for MA.

    In a majority decision authored by Justice Steinmetz, the supreme court held that the failure of an institutionalized spouse to assert a claim against the estate of his or her deceased spouse constitutes a divestment for purposes of determining MA eligibility. Under Wisconsin law, a person is entitled by statute to a portion of his or her spouse's estate. If the institutionalized person does not make a claim against his or her community spouse's estate, this failure to contest is a conscious act that constitutes divestment. Divestment results in MA ineligibility. See Wis. Stat. 49.453.

    To conclude otherwise, said the court, would be contrary to the purposes of the divestment provisions of MA legislation. The practical effect of the petitioner's inaction is that persons other than the community spouse or the institutionalized spouse will receive the financial benefits of the conscious act to reject her share of the estate. The result will be that the state's taxpayers will bear the burden of supporting the petitioner while she resides in the nursing home and receives MA. If she had not rejected her share of her spouse's estate, then those assets would have been available to provide for her maintenance and health care without burdening the taxpayers.

    Chief Justice Abrahamson filed a concurring opinion.

    Taxation

    Agricultural Land Assessments - Wis. Stat. section 70.32(2r) - Uniformity Clause

    Norquist v. Zeuske, No. 96-1812-OA (filed 25 June 1997)

    Section 70.32(2r) of the Wisconsin Statutes took effect Jan. 1, 1996. It provides for three phases for transforming agricultural land assessments for property taxes from a market value system to a use value system. The first phase, created by section 70.32(2r)(a), freezes assessments of agricultural land at the Jan. 1, 1995, assessment level. This freeze, which began in 1996, will last for at least two years. Section 70.32(2r)(b) provides for a mixed assessment system that will last from the end of the initial freeze until 2009. During this period, agricultural land will be assessed based partly upon the frozen market value assessments and partly upon the land's agricultural use value. In each year during this phase, the market value assessment is reduced by 10 percent and the use value portion of the assessment is increased by 10 percent. In 2009 the mixed assessment period ends and agricultural land will be assessed based entirely on its agricultural use value.

    The petitioners brought this original action to challenge the constitutionality of section 70.32(2r). They contended that the freeze established in section 70.32(2r)(a) violates the Uniformity Clause of the Wisconsin Constitution. They further argued that section 70.32(2r)(b) also violates the Uniformity Clause because the market value portion of the mixed assessment is based upon the frozen amount designated in section 70.32(2r)(a). Respondent Zeuske, the Secretary of the Wisconsin Dept. of Revenue, disagreed with the petitioners' contentions and further argued that the petitioners lacked standing to challenge the statute.

    In a unanimous decision authored by Justice Wilcox, the supreme court concluded that one of the petitioners actually owns agricultural land, that his status as an agricultural landowner is logically related to his claim that the statute violates the Uniformity Clause, that he has demonstrated the injury necessary for standing inasmuch as the value of his agricultural land could decrease and will inevitably change by a degree different from other agricultural land, and thus he has standing to challenge the constitutionality of section 70.32. [The court did not consider the standing of the other petitioners.

    However, the court concluded that the record in this case is not sufficiently developed and that a decision on the constitutionality of the statute would thus be premature. The petitioner who has the standing to bring this action has not offered any evidence that his property is overassessed or that other agricultural land is underassessed. In determining that this petitioner's action is premature, the court did not declare the statute either constitutional or unconstitutional. That determination must await a more developed record.

    To prove the statute unconstitutional, an owner of agricultural land will have to 1) satisfy an initial burden of proving that his or her agricultural land is overassessed and that other agricultural land is underassessed as a result of the statute, and 2) demonstrate beyond a reasonable doubt that section 70.32(2r) does not create uniform taxation of agricultural land to the extent practicable.

    Torts

    Discovery Rule - Sexual Assaults - Minors

    John BBB Doe v. Archdiocese of Milwaukee, No. 94-0423 (filed 27 June 1997)

    The supreme court heard seven consolidated appeals. All involved plaintiffs who alleged that as children they were sexually abused by priests. All of their complaints were dismissed either because they were time barred, or failed to state a claim for which relief could be granted, or on public policy grounds. The court of appeals certified the following question: "Does the discovery rule save an otherwise untimely, noninces-tuous, sexual assault claim against the individual alleged perpetrator when the alleged victim was a minor, and the alleged perpetrator was a person in a position of trust vis-a-vis the child victim?"

    The supreme court, in an opinion written by Justice Geske, held that the claims of each plaintiff were time barred by the statute of limitations for minors. Each plaintiff discovered, or in the exercise of reasonable diligence, should have discovered that he or she was injured at the time of the alleged assaults by the last date of the alleged multiple assaults. The court's decision is extremely fact-intensive. In the case of five plaintiffs, the claims alleged intentional acts, immediate injuries, and an "obvious" causal link. These claims accrued by the time of the last incident of sexual assault and are governed by the statute of limitations for minors, which provides for a longer time period for younger victims. The court also declined to equate these cases with incest allegations, which are covered by a longer time period. Finally, the court held "that a claim of repressed memory of past sexual abuse does not delay the accrual of a cause of action for nonincestuous sexual assault, regardless of the victim's minority and the position of trust occupied by the alleged perpetrator."

    Chief Justice Abrahamson concurred but wrote separately to voice her continuing displeasure with Pritzlaff v. Archdiocese of Milwaukee (1994).


    This column summarizes all decisions of the Supreme Court. Prof. Daniel D. Blinka and Prof. Thomas J. Hammer invite comments and questions about the digests. They can be reached at the Marquette University Law School, 1103 W. Wisconsin Ave., Milwaukee, WI 53233, (414) 288-7090

    Wisconsin Lawyer


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