Wisconsin Lawyer
Vol. 78, No. 7, July
2005
Letters
Letters to the editor:
The Wisconsin Lawyer publishes as many letters in each issue as space
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them.
Cease Electric Negatively Affects
State's Economic Growth
I read with interest Judge Cane's and Ms. Sullivan's scholarly
article in the May 2005 Wisconsin Lawyer on the history of the
economic loss rule in Wisconsin following the recent Wisconsin Supreme
Court decision in Cease Electric. As I read it, I was reminded
of Palsgraf and its ilk in the discussion of public policy
considerations, privity, etc. The article and Cease Electric,
in other words, recalled an earlier, simpler era of common law
responding to a different economic time. Unfortunately, however, those
earlier, simpler times do not provide incentive to businesses to locate
initially in Wisconsin or, if given an opportunity to relocate, to
remain here, in no way a desirable result for our state.
What the article's discussion misses completely, and where
Cease Electric crossed the line from being a simplistic
decision about poor electrical work on a chicken coop to having a hugely
serious policy impact on economic growth (including job growth) in
Wisconsin, is in the "bright line" rule Cease
Electric gratuitously added that the economic loss doctrine does
not apply to contracts for services. Such a "bright line" rule
ignores and inappropriately obviates the difference between relatively
unsophisticated consumer service engagements and complex, long-term
commercial services agreements negotiated and entered into between
sophisticated business entities.
Wisconsin has a very significant and growing business sector that
is providing extremely sophisticated services to knowledgeable clients
nationwide and worldwide by written contract. Those contracts virtually
always contain highly negotiated and detailed representations and
warranties, limitations of liability, indemnities, and other provisions
designed to balance the economic and other risks of both parties - the
services provider and the client. Generally excepted for public policy
reasons from the limitations of liability provisions of such contracts
are liabilities resulting from personal injury or property damage. And,
at least in cases I am familiar with, until Cease Electric
Wisconsin law, with its strong economic loss rule, governed construction
of these contracts, although sometimes that term may be negotiated as
well. After Cease Electric, though, for Wisconsin corporations
Wisconsin law has become problematic to govern complex contracts.
While the Cease Electric bright-line rule may be fine for
services situations in which there is no written contract, just as the
UCC substitutes for written agreements in the sale of goods (where the
economic loss rule was originally grounded), the bright-line rule
established by Cease Electric for all services
agreements went far too far. It betrayed on the part of the supreme
court both a lack of understanding of modern Wisconsin business and
almost, one senses from the Cease Electric decision, a yearning
for a less complicated time. Unfortunately, those failings have
potentially done real damage to Wisconsin economic development and once
more provide business interests a reason not to locate in Wisconsin
initially or to leave at an appropriate opportunity, neither of which is
a good result.
Charles W. Sprague
Brookfield
Anecdote Illustrates Public Image
Message
I read with interest George Brown's column in the May 2005
Wisconsin Lawyer, concerning his mother's positive experience
with her estate planning attorney. The column noted how the lawyer
anticipated the client's needs by finalizing the documentation in one
meeting so Brown's elderly mother didn't need to make another trip. The
article also indicated that although the hourly rate charged was not
insignificant, the total cost was less than expected because the matter
was concluded efficiently. Brown's article exemplifies many of the
components of the State Bar Public Image effort and displays how getting
the right message to the public and our members can make the effort more
effective.
When people ask me why the State Bar is involved in a Public Image
effort, I explain that it is not intended to be a glitzy ad
campaign, but rather a grassroots effort to inform the public about the
value Wisconsin lawyers provide. We are experts who solve problems for
our clients and who serve our communities in a variety of ways. As a
group, it is important to specify how we can assist those who may
otherwise act pro se and the value we provide that is different from
other professions. This effort includes directing the public to
resources that can be efficient and economical - such as living will and
health care power of attorney forms that can be completed without an
attorney - and to encourage the public to seek out a Wisconsin lawyer
when the circumstances warrant one.
Many of the individual lawyers and groups of lawyers featured in
the Public Image effort are providing pro bono services, but the
intrinsic message about all the attorneys is that the services and
problem solving skills they provide are valuable enough to justify
payment for their legal expertise. Brown's anecdote is precisely the
type of public awareness the Public Image effort wants to promote. It is
just one example of good lawyering; other clients may require more time
and the charges may be substantially higher. The theme, though, is the
same - Wisconsin lawyers use their expertise to solve their clients'
problems.
Although I'm sure we did not need to convince Brown or
Wisconsin Lawyer readers of the value of attorneys, Brown's
personal experience makes for a much more effective message. As an
association, we should be responsible for making sure this message is
delivered. I thank Brown for sharing his mother's experience.
Kevin Palmersheim, chair
Public Image Committee
Wisconsin Lawyer