Court of Appeals Digest

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

| Civil Procedure/Evidence | Commercial Law | Contracts | Courts |
| Criminal Procedure | Torts | Worker's Compensation |

Jurors as Witnesses ­ Learned Treatises ­ Offers to Settle

Broadhead v. State Farm Mut. Ins. Co., No. 97-0904 (filed 26 Feb. 1998) (ordered published 25 March 1998)

Plaintiff was injured in an automobile accident. The parties stipulated to liability and tried the damages issue. After the trial commenced, one juror belatedly remembered having seen the plaintiff do some work at his house. The judge excused the juror and rejected a defense request to call the former juror as a witness to the plaintiff's ability to do physical labor. The jury awarded the plaintiff about $40,000 in damages. On appeal the defendant raised several evidentiary issues. The court of appeals, in an opinion written by Judge Deininger, affirmed.

First, the court upheld the trial judge's decision to exclude testimony by the former juror. The former juror had heard nearly an entire day of testimony. The marginal probative value of his proffered testimony, combined with the difficulties of impeaching a former member of the jury panel, justified the judge's decision to exclude the testimony under section 904.03. The court of appeals stated that it found "it hard to envision any circumstance under which it would be appropriate to allow a person who has been discharged from a jury in midtrial to testify before the same jury." The defense also argued that it should have been permitted to call the former juror's wife or father to testify to the plaintiff's physical condition. The court ruled, however, that the defense had failed to make an adequate offer of proof that described what, if any, relevant testimony these witnesses could provide.

Second, the court of appeals addressed the proper foundation for learned treatises under section 908.03(18) of the Wisconsin Statutes. During a videotaped deposition, a doctor read from several articles that appeared in recognized journals. The trial judge erred by permitting the jury to hear this part of the deposition. The plain language of section 908.03(18) requires a showing that the writer of the article is a recognized expert in the area; the reputation of the journal is not dispositive. The error was, however, harmless.

Finally, the court rejected the plaintiff's contention that she was entitled to double costs. The defense had offered to settle for "$42,000 with costs." At trial the plaintiff obtained a judgment for $42,141, which consisted of $38,116 in damages plus taxable costs of $3,536 and post-verdict interest of $488. The case law construing section 807.01(3) of the Wisconsin Statutes mandates that the offer and judgment must be compared exclusive of costs.

Statute of Frauds ­ "Merchant"

Harvest Store Cooperative v. Anderson, No. 97-2762-FT (filed 24 Feb. 1998) (ordered published 25 March 1998)

Anderson was a forklift operator who did not own a farm but who "has cows and grows corn." During a phone conversation with Harvest Store, Anderson discussed the sale of 5,000 bushels of corn. Harvest Store sent an "unsigned confirmation of contract in the mail" but Anderson sold the corn to someone else at a better price. Harvest Store sued him for the $5,000 it allegedly cost them to replace Anderson's corn with that purchased at a higher price. Anderson defended on statute of frauds grounds, but the court ruled this defense was unavailable because the oral contract was "between merchants." Wis. Stat. § 402.201(1). In the judge's words, "a farmer who sells grain is a merchant."

Judge Cane, writing for the court of appeals, reversed. The issue has generated a great deal of discussion under the U.C.C. and conflicting case law. The term "merchant" does not "attach to the casual or inexperienced seller." The determination must be made on a case-by-case basis. The record established Anderson's limited experience selling crops. He had never seen a sale confirmation contract before his encounter with Harvest Store. In sum, Anderson's "three prior experiences, involving relatively small quantities of corn that he drove to the scale and sold without any written contract, put him in the category of the casual and inexperienced seller."

Voidable Contracts ­ Election of Rights

Gaugert v. Duve, No. 97-0355 (filed 25 Feb. 1998) (ordered published 25 March 1998)

In 1988 the Gaugerts purchased some land from Duve. At that time Duve signed a contract purportedly giving the Gaugerts a right to "first refusal for extra land." In 1995 Duve discussed selling the remaining land to another party. The Gaugerts demanded the right to exercise their option. Some months later Duve mailed the Gaugerts a written offer allowing them to exercise their option. After the Gaugerts exercised their option, Duve claimed that the original 1988 "first refusal" option was invalid and rescinded the proffered option. Following a bench trial, the judge found that the Gaugerts had not defrauded Duve in 1988 but that the 1988 option was void for lack of consideration and because no meeting of the minds had occurred. The judge also ruled that no "election of rights" had occurred in part because Duve did not actually know that the contract was unenforceable when he gave the Gaugerts the opportunity to exercise the option.

The court of appeals, in an opinion written by Judge Brown, reversed. Election of rights is not limited to cases of fraud. "Election" is "a choice, shown by an overt act, between two inconsistent rights, either of which may be asserted at the will of the chooser alone." Nor should election be confused with waiver, which requires a "voluntary and intentional relinquishment of a known right." An election "is effective even though there is no intent to relinquish the other, inconsistent right." Under prevailing authority, "it would be inequitable to regard an election of rights as final unless the party having the right of election was aware, or should have been aware, of all material facts making one option more desirable than the other."

The trial judge appropriately found "that Duve was unaware of his option to avoid the contract when he sent the notice." The court of appeals found, however, that Duve should have been aware of these two options, especially since he had benefit of legal counsel throughout the relevant time period. "Having elected to execute the contract, Duve can no longer contend that the contract was void for lack of consideration and mutuality."

Municipal Courts ­ Power of Judge to Order Defendant
to Appear Personally ­ Default Judgment for Nonappearance

City of Sun Prairie v. Davis, No. 97-1651 (filed 26 Feb. 1998) (ordered published 25 March 1998)

The City of Sun Prairie charged the defendant in a civil forfeiture action with violating its operating a motor vehicle while intoxicated ordinance. The citation indicated that the appearance of the defendant at an initial court appearance was mandatory, but he chose not to appear. Instead, the firm of lawyers representing him sent a letter to the court on the defendant's behalf, and the court entered not guilty pleas on both charges.

Thereafter the court issued an order directing the defendant to be present for trial. The defendant's attorney wrote back objecting to the order requiring the defendant to be present and asserting that the court had no authority to make such an order. Counsel stated that the defendant would not comply with the order as he had chosen to have counsel be present instead. The court then responded with a further order indicating that, if the defendant did not appear personally at his trial, the court would impose one or more sanctions that could include entry of judgment against him.

When the defendant did not appear for trial, the court found that he had intentionally and egregiously violated orders of the court which it had issued to efficiently manage the case, and it granted judgment against the defendant and in favor of the city, as a sanction for disobedience of the court's orders.

The defendant appealed to the circuit court, which affirmed the order of the municipal court. The court of appeals, in a majority decision authored by Judge Roggensack, affirmed. The majority concluded that a municipal judge has inherent authority to order a civil litigant to be present at trial and that nothing in the statutes or in the Wisconsin Constitution precludes sanctioning the violation of such a court order by entering judgment against the violator. The court cautioned that a sanction that terminates litigation on the merits should not be imposed unless the violating party's conduct is egregious and without a clear and justifiable excuse. The appellate court was satisfied that the record in this case showed a reasonable basis for the municipal court's determination that the defendant's conduct was egregious and was not supported by any clear and justifiable excuse. The defendant was not sanctioned because he chose to have counsel present at his trial but rather because he flaunted two court orders directing him to personally appear at the trial.

Judge Dykman filed a dissenting opinion.

Judge's Personal Notes ­ Access by Litigants

State v. Panknin, No. 97-1498-CR (filed 25 Feb. 1998) (ordered published 25 March 1998)

In this appeal the defendant continued his pursuit for access to notes for his sentencing prepared by the trial court and sealed in the court record. His argument was that the trial court should be compelled to make the notes available so that he can determine if the court relied upon inaccurate information or other improper factors in imposing his sentence. In a decision authored by Judge Anderson, the court of appeals affirmed the order of the circuit court denying the defendant access to the judge's personal notes.

In sum, the court concluded that the notes of judges, whether cryptic or formal, do not represent their final ruling or decision; that is only represented in oral decisions rendered from the bench, memorandum decisions, written orders or judgments, or opinions from the court of appeals and the supreme court. "In many cases it takes a great deal of work to reach a final ruling or decision: the back roads traveled, the dead ends encountered should not be accessible to a litigant." It is only the final reasoning process that judges are required to place on the record that is representative of the performance of judicial duties. Accordingly, access to a judge's notes by the litigants would significantly disrupt the judicial decisional process.

In footnote the court commented that a judge's personal notes should not be placed in the clerk of court's file. The better practice is to maintain notes in chambers where their confidential nature can be ensured.

Prosecuting Attorneys ­ Conflict of Interest

State v. Stehle, No. 97-1160-CR (filed 4 Feb. 1998) (ordered published 25 March 1998)

The defendant was charged with several counts of burglary. He maintained that the assistant district attorney's prosecution of the case in which one count involved the burglary of the home of the ADA's ex-wife and their adult daughter constituted a conflict of interest requiring the assistant district attorney to withdraw from the case.

In a decision authored by Judge Anderson, the court of appeals concluded that, because the assistant district attorney immediately revealed the potential conflict of interest to both the defendant and his attorneys and did so before the defendant entered his no contest plea to the charges, once the defendant pled no contest he waived review of any potential conflict of interest claim. A no contest plea, voluntarily and understandingly made, constitutes a waiver of all nonjurisdictional defects and defenses. A claim that a prosecutor should be disqualified for a conflict of interest does not implicate a trial court's jurisdiction and is waived by a plea of no contest.

Moreover, courts generally require a prima facie showing of prejudice before invalidating prior proceedings based on a conflict of interest. In this case the defendant made no showing that the purported conflict in any way affected his criminal prosecution.

Due Process ­ Outrageous Governmental Conduct

State v. Givens, No. 97-1248-CR (filed 25 Feb. 1998) (ordered published 25 March 1998)

The defendant was charged with delivery of cocaine and heroin. The charges stemmed from controlled drug buys arranged by the Wisconsin Division of Narcotics Enforcement (DNE) with an informant, whose name was Franklin. The defendant pleaded not guilty and the matter eventually was tried to a jury.

At trial, Franklin testified to the drug buys she made from the defendant. She explained that she herself was a heroin addict for about 20 years but was "clean" at the time of trial. Franklin admitted that she used heroin while she was working undercover for the government in violation of the written agreement she had entered into with the government agents. However, she stated at trial that she never informed the agents that she was using heroin. In fact, one of the agents testified that he routinely asked Franklin if she was using heroin and she answered no. Among the issues on appeal was the defendant's claim that the state's use of Franklin as a witness constituted outrageous conduct and violated his due process rights. The state countered that the defendant waived any right to raise this defense on appeal because he failed to raise it in the trial court.

The court of appeals, in a decision authored by Judge Anderson, affirmed. The court agreed to consider the outrageous conduct issue because the state did not controvert the fact that Franklin blatantly violated her agreement with the government or the fact that once the government became aware of her conduct at the preliminary hearing it continued to use her at the trial.

The concept of outrageous governmental conduct originates from the Due Process Clause of the Fifth Amendment. This defense requires an assertion by the defendant that the state violated a specific constitutional right and that the government's conduct was so enmeshed in a criminal activity that prosecution of the defendant would be repugnant to the American criminal justice system.

In this case the government was not enmeshed in or aware of Franklin's heroin use. At trial, Franklin admitted that she was using heroin and cocaine while working with the government in violation of her agreement with government agents. However, she also testified that she never informed the agents that she was using heroin nor did she ask them for money to buy controlled substances. The court concluded that the government's use of Franklin as a witness, even though she used heroin in violation of her agreement with the government while making purchases, did not alone amount to a violation of fundamental fairness that shocks the universal sense of justice.

Further, in order for a defendant to successfully assert a claim of outrageous governmental conduct, he or she must assert that a specific constitutional right has been violated. In this case the defendant did not identify a specific constitutional right, such as a Fifth Amendment right against self-incrimination or a Sixth Amendment right to counsel. The court concluded that there was no arguable merit to a claim that the defendant's due process rights were violated by outrageous governmental conduct.

Interference with Contracts ­
Burdensome and Expensive Performance

Mangum Radio Inc. v. Brieske, No. 97-2754 (filed 19 Feb. 1998) (ordered published 25 March 1998)

When Mangum Radio attempted to purchase two radio stations in the Tomah area, Brieske wrote a letter to the FCC complaining that Mangum would not provide adequate sports and local news coverage for the area. Brieske also allegedly was interested in purchasing the stations. The FCC ultimately approved Mangum's purchase but it brought suit against Brieske for intentionally interfering with its business relations with the sellers. The trial judge dismissed the action.

The court of appeals, in an opinion written by Judge Eich, reversed. The issue in this case was "whether a person whose alleged interference with a contractual relationship results not in abandonment or nonperformance of the contract but only in making the plaintiff's performance of the contract more expensive or onerous may also be held liable for his or her actions." Agreeing with Mangum that such claims are cognizable, the court rested its holding on case law and the Restatement (Second) of Torts section 766A. The pleadings, liberally construed, adequately alleged that Mangum's operation of the stations might have become more expensive because of Brieske's objections (for example, an offer to broadcast high school basketball games). Issues of fact for the trial court remained on whether Brieske's letter to the FCC was a "legally protected right" or constituted intentional interference with Mangum's economic relationship.

Exclusivity ­ Waiver

Brantner v. ABC Manufacturing Co., No. 97-1523 (filed 24 Feb. 1998) (ordered published 25 March 1998)

The plaintiff severely injured her hand at work when it became entangled in a packaging machine. Initially she sued the machine's manufacturer but later sought to include her employer and coemployees after the plaintiff learned that fellow workers may have removed guarding from the machine. The trial judge granted summary judgment dismissing the employer, the coemployees, and the employer's general liability insurer.

The court of appeals, in an opinion written by Judge Cane, affirmed. The sole issue concerned whether the employer had waived the worker's compensation exclusivity provision. Examining the pertinent cases, the court held that it had not. Without question the plaintiff's injury fell under the worker's compensation act and therefore its exclusivity protection. The employer had not waived exclusivity protection by terms of its insurance coverage. The insurance policy endorsement in question "was intended to broaden the definition of an insured to include an employee in situations where the worker's compensation law should not apply." The policy continued to exclude coverage for injuries covered by the worker's compensation law. The court's reasoning applied not only to the claims against the employer, but those against the coemployees as well.

This column summarizes all decisions of the Wisconsin Court of Appeals. 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.

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