Vol. 73, No. 4, April 2000

Court of Appeals Digest

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

Editor's Note: Each case summarized in the Court of Appeals Digest includes its new public domain citation.

| Arbitration | Damages | Family Law |
| Insurance | Worker's Compensation |

Confirmation - Costs - "Double Costs" - Offers to Settle - Stays

Briggs v. Farmers Ins. Exchange, 2000 WI App 40 (filed 25 Jan. 2000) (ordered published 23 Feb. 2000)

The plaintiff was injured in an accident and claimed uninsured motorist coverage from her insurer. She filed suit but later agreed to a stay and arbitration. After arbitration Briggs received judicial confirmation of her award pursuant to section 788.09 of the Wisconsin Statutes. The circuit court also awarded her costs under chapter 814.

The court of appeals, in an opinion written by Judge Hoover, reversed. Prior cases established that chapter 814 "envisions a 'prevailing party' as one who is successful in a litigated trial court proceeding, not one who succeeds in obtaining an award before an arbitrator." In this case Briggs asked the court to decide only if one or two policies were applicable. Examining the record, the court of appeals held that litigation did not amount to a "contested trial court proceeding." The trial court also erred by awarding Briggs double costs pursuant to section 807.01. After she agreed to arbitrate the claim, Briggs served the insurer with an offer to settle under section 807.01. The insurer never responded. The court held that the insurer was not obligated to respond to the offer because the trial court had stayed proceedings pending arbitration.

Contracts - Intentional Interference - Mental Health Treatment - Compensatory Damages

Musa v. Jefferson County Bank, 2000 WI App 33 (filed 27 Jan. 2000) (ordered published 23 Feb. 2000)

Musa owned a hotel on which the bank held a mortgage. Musa tried unsuccessfully to sell the hotel but the bank foreclosed and the hotel was scheduled for a sheriff's sale. Musa sued the bank and Buelow, a bank officer, asserting a variety of claims. One set of claims alleged that Buelow had intentionally interfered with a possible sale to Aliu. The jury found for Musa and determined that Buelow should pay $4,000 in consequential damages and $50,000 in punitive damages. The bank was found liable for $4,000 in consequential losses resulting from its intentional interference and assessed nearly $400,000 for losses stemming from its breach of the duty of good faith. On post-verdict motions, the judge ruled that Musa could not recover the $4,000 in consequential damages from Buelow because there had been no pecuniary damages, and, without any compensatory damages, Musa could not recover the punitive damages award from Buelow.

The court of appeals, in an opinion written by Judge Vergeront, affirmed on different grounds. The dispositive issue was whether "a plaintiff may recover damages for the costs of mental health treatment on a claim for intentional interference with a prospective contract, when no other compensatory damages are awarded on that claim." The case law permits damages for emotional distress resulting from intentional torts where there are "substantial other damages in addition to damages for emotional distress" (¶ 10). The court held that case law "requirement of substantial other damages must logically be applied both to general damages for emotional distress and to damages for costs of mental health treatment" (¶15). Alternatively, Musa argued that the $400,000 damage award against the bank satisfied the "substantial other damages" element. The court also rejected this argument because the special verdict expressly negated it: The jury was instructed to consider separately each defendant, each claim, and each category of damages.

Divorce - Maintenance - Consideration of Premarital Cohabitation in Determining Maintenance - Unjust Enrichment

Meyer v. Meyer, 2000 WI App 12 (filed 9 Dec. 1999) (ordered published 19 Jan. 2000)

The parties in this divorce action cohabited from 1987 until 1993 at which point they married. The wife filed for divorce in 1997. The circuit court awarded her maintenance and, in making the maintenance decision, considered the parties' lengthy nonmarital relationship. The court of appeals, in a majority decision authored by Judge Dykman, reversed the circuit court.

Though the determination and amount and duration of maintenance rest within the discretion of the trial court, the appellate court concluded that the circuit judge erroneously exercised discretion by considering the premarital relationship when it made its maintenance determination. The court relied primarily upon Greenwald v. Greenwald, 154 Wis. 2d 767, 454 N.W.2d 34 (Ct. App. 1990), wherein it held as a matter of law that a trial court may not consider premarital contribucontributions in its maintenance and property division determinations.

The appellate court also addressed the wife's claim of unjust enrichment based upon her support of her husband while he obtained his undergraduate and medical degrees, most of which occurred prior to their marriage. Her husband graduated from medical school one year after the parties were married and he thereafter began his residency program.

In Wisconsin "unmarried cohabitants may raise claims based upon unjust enrichment following the termination of their relationship where one of the parties attempts to retain an unreasonable amount of the property acquired through the efforts of both." Watts v. Watts, 137 Wis. 2d 506, 532-33, 405 N.W.2d 303 (1987). In a nonmarital cohabitation situation, for the complaining party to recover under an unjust enrichment claim, he or she must demonstrate: 1) an accumulation of assets, 2) acquired through the efforts of the claimant and the other party, and 3) retained by the other party in an unreasonable amount.

The husband in this case argued that his wife's unjust enrichment claim could not succeed because she has not shown an accumulation of assets, pointing out that the claim was based on her support while he obtained a medical degree. The appellate court agreed with him that a degree is not an asset for purposes of an unjust enrichment claim.

Judge Deininger filed a dissenting opinion.

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