Vol. 75, No. 5, May
2002
Court of Appeals Digest
This column summarizes selected published opinions
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.
by Prof. Daniel D. Blinka &
Prof. Thomas J. Hammer
Civil Procedure
Discovery Abuse - Admissions - Evidence - Punitive Damages
Mucek v. Nationwide Comm.
Inc., 2002 WI App 60
(filed 21 Feb. 2002) (ordered published 27 March 2002)
A hotel owner sued NCI, a long-distance carrier, on a variety of
claims, including breach of contract, malicious prosecution, and abuse
of process. The suit sought compensatory and punitive damages. Despite
numerous motions seeking discovery, NCI failed to respond. One year, two
lawyers, and numerous missed deadlines later, the court found NCI 100
percent liable, leaving damages as the only remaining issues. Months
later another lawyer appeared for NCI and sought to "withdraw" various
admissions that the court also had entered against NCI. The trial court
refused to do so, citing NCI's history of abuse. In the damages trial,
the court permitted evidence of other acts of misconduct by NCI as
bearing on punitive damages.
The court of appeals, in an opinion written by Judge Lundsten,
affirmed. First, the trial court properly exercised its discretion when
it denied NCI's motion to withdraw the admissions. Under Wis. Stat.
section 804.11(1)(b), a court may permit amendment or withdrawal of
admissions only if "the merits of the action will be subserved" and if
the party who benefits by the admissions will not be prejudiced. Here
the hotel owner had established "prejudice," particularly in light of
NCI's "ongoing failure to cooperate with discovery" (¶27). Indeed,
one of NCI's prior attorneys had himself withdrawn because of such
abuses. The court held a judge "may consider a party's history of
discovery abuse when deciding whether to permit withdrawal or amendment
of admissions, both when determining prejudice under § 804.11(2)
and when otherwise exercising the court's authority to control the
orderly and prompt processing of a case" (¶28).
Second, the other acts evidence was properly introduced at the
damages phase of the trial. NCI's liability was determined when the
court struck its answer and the parties stipulated to compensatory
damages. As to the punitive damages claim, prior case law permitted the
use of other acts to gauge the seriousness of NCI's conduct. The other
acts embraced complaints brought by dissatisfied customers in other
states and newspaper articles.
Finally, the trial court did not err by refusing to lower the
punitive damages award. On this record, the $225,000 award was not
unreasonably excessive.
Judge Dykman dissented, arguing that this was the rare case in which
"the conduct or character of a litigant so overshadows the merits of a
case that the former becomes the reason the litigant cannot be
successful at trial" (¶49).
Criminal Procedure
Double Jeopardy - Multiple Charges - Same Type of Acts - Volitional
Departure
State v. McKinnie,
2002 WI App 82 (filed 13 Feb. 2002) (ordered published 27 March
2002)
Waukesha County charged the defendant with carjacking for
intentionally taking a vehicle without consent by threat of force and
while armed with a dangerous weapon. Approximately 12 hours later, the
defendant drove the same vehicle without the owner's consent in the City
of Milwaukee. Milwaukee County charged the defendant with operating an
automobile without the owner's consent (OAWOC) and he pled guilty to
that charge. He then sought dismissal of the Waukesha County carjacking
charge because he already had been convicted of the lesser-included
offense of OAWOC in Milwaukee County. The Waukesha County Circuit Court
denied the motion to dismiss.
In a decision authored by Judge Anderson, the court of appeals
affirmed. It concluded that the defendant engaged in separate, distinct
criminal acts and that neither constitutional nor statutory double
jeopardy bars apply to his case. Determining whether the defendant's
acts are sufficiently different in fact to warrant multiple charges
involves a determination of whether the charged acts are separated in
time or are of a significantly different nature. The "different nature"
inquiry is not limited to an assessment of whether the acts are
different types of acts. Rather, even the same types of acts are
"different in nature" if each requires a new volitional departure in the
defendant's course of conduct. See State v. Koller, 2001 WI
App 253.
In this case the defendant was alleged to have carjacked a vehicle in
Waukesha County and then, approximately 12 hours later, again committed
himself to driving a stolen car. Each act required a new volitional
departure in the defendant's course of conduct and therefore, as
alleged, his offenses are separate and distinct and may be separately
charged.
Insurance
ERISA - Subrogation - "Made Whole" Doctrine
Bruzas v.
Quezada-Garcia, 2002 WI App 57 (filed 6 Feb. 2002) (ordered
published 27 March 2002)
The primary parties in this case, two insurance companies, fashioned
a "test case" designed to answer the question whether a right of
subrogation under an ERISA plan preempts the "make whole" doctrine
(¶12). Bruzas, his wife, and his child were seriously injured in a
car accident. Bruzas' ERISA carrier paid more than $16,000 of his
medical expenses. The tortfeasor's insurer, American Family, paid its
coverage limits of about $40,000, which was far less than the Bruzas'
actual damages. The parties agreed that Bruzas was not made whole within
the meaning of Rimes v. State Farm Mut. Auto. Ins. Co. (1982).
Since American Family also provided Bruzas with underinsurance coverage,
it paid him an additional $57,000. The ERISA carrier claimed that it was
subrogated to Bruzas for the amount of its medical payments. The trial
court agreed and awarded the ERISA carrier about $16,000 (pursuant to
the parties' agreement, American Family held Bruzas harmless for this
recovery).
The court of appeals, in an opinion written by Judge Nettesheim,
affirmed. The threshold issue before the court concerned the appropriate
standard of review to be applied to an ERISA plan administrator's
determination. Ultimately, the court did not have to reach the parties'
arguments pertaining to the plan's language itself. Rather, the court
grappled with the ambiguity created by two court of appeals decisions,
Newport News Shipbuilding Co. v. T.H.E. Ins. Co., 187 Wis. 2d
364 (Ct. App. 1994), and Schultz v. Nepco Employees Mut. Benefit
Ass'n Inc., 190 Wis. 2d 742 (Ct. App. 1994). It found that
Newport News was the "better reasoned" of the two cases and
elected to follow its analysis.
In this case, the ERISA plan did not expressly use the term
"discretion," but it nonetheless granted broad authority to the Plan
Administrator (PA). Thus, the court was satisfied that the PA "has the
requisite discretion contemplated by Newport News, even though
the plan language does not use that express term" (¶21).
Newport News further provides that the PA is afforded
"substantial deference" in determining whether it is entitled to
reimbursement based on the policy's subrogation clause. The record in
this case betrayed no abuse of discretion.
Reducing Clauses - UM Coverage
Janssen v. State Farm Mut.
Auto. Ins. Co., 2002
WI App 72 (filed 12 Feb. 2002) (ordered published 27 March 2002)
Janssen was a passenger who was injured in a two-car accident.
Neither of the drivers had insurance. Janssen's own insurer paid the
$25,000 limits of her uninsured motorist (UM) coverage. She then sought
additional UM coverage under State Farm policies held by her parents.
When State Farm applied its reducing clause, which zeroed the coverage,
Janssen brought this lawsuit. The trial court agreed that State Farm
could apply its reducing clause to the monies paid by Janssen's own UM
carrier.
The court of appeals, in an opinion written by Judge Cane, reversed.
The policy language, which was consistent with Wis. Stat. section
632.32(5)(i)1., "refers to payments made by and on behalf of
tortfeasors, and not to payments made pursuant to the insured's own
uninsured motorist coverage" (¶11). The analysis centered on the
phrase, "legally responsible for the bodily injury or death for which
the payment is made." The court concluded that Janssen's UM carrier was
a "contractually liable party" that did not fall within the "legally
responsible" language. This construction also gave effect "to the
remaining subsections of § 632.32(5)(i), which provide for a
reduction of amounts paid or payable under `any worker's compensation
law' or any `disability benefits law.'" Indeed, were worker's
compensation or disability payments factored into the formulae, the
result would negate the point of UM and underinsured coverage guaranteed
by section 632.32(5).
Juvenile Law
CHIPS - TPRs - Character Evidence
La Crosse County DHS v. Tara
P., 2002 WI App 84 (filed 14 Feb. 2002) (ordered published 27
March 2002)
The court of appeals, in an opinion written by Judge Lundsten,
affirmed a circuit court's order that terminated Tara P.'s parental
rights to two of her children. On appeal Tara alleged that error
occurred when the trial court admitted evidence of events occurring
prior to the CHIPS dispositional order. The court clarified that despite
dicta in a prior case, "the facts occurring prior to a CHIPS
dispositional order are frequently relevant to the issues at a
termination proceeding" (¶10). To the extent that such dicta
pointed to the opposite conclusion, it was "plainly wrong"
(¶12).
In this case the county presented evidence that prior to the
dispositional orders and while she had custody of her children, Tara
"repeatedly failed to comply with requirements necessary to maintain
public assistance benefits (benefits which would have provided money for
housing and utilities) and repeatedly failed to keep appointments with
Job Service, an employment training program" (¶14). Her "long
history" of similar conduct made it highly unlikely that she could meet
the stable housing and employment standards within the 12-month period
contemplated by Wis. Stat. section 48.415 (2)(a)2.b. and 3. Finally, the
court held that a parent's character traits and propensity is a
substantive issue in such proceedings.
Delinquency - Original Disposition - SJOP Placement
State v. Terry T.,
2002 WI App 81 (filed 6 Feb. 2002) (ordered published 27 March 2002)
In August 1999 the court placed Terry T., then age 12, into a Type 2
facility that offered a sex offender program for persons with cognitive
disabilities. The underlying offense involved a sexual assault on a
younger child. In 2000 the court granted an extension of the original
order, without objection, until August 2001. In February 2001 the state
moved to revise the dispositional order and change placement to a
Serious Juvenile Offender Program (SJOP) and extend the placement for
five years. Despite Terry's objection, the trial court granted the
request.
The court of appeals, in an opinion written by Judge Brown, reversed.
Terry's original placement was not to the SJOP or a secured institution.
Under the statutes, Terry was not originally eligible for SJOP in August
1999 because of his age, even had the court been so inclined - which it
was not. The court of appeals found it "untenable" to place Terry in the
program at a later proceeding: "Such a result would allow the State to
bootstrap the original sexual assault violation as a basis for placement
in the SJOP now that Terry is of age, even though the court had
previously concluded secured placement was not the most appropriate
setting" (¶16). In summary, the court held "that the five-year SJOP
is a placement that must occur at an original disposition; it is not a
tool to extend, revise or change a placement already in effect"
(¶17).
Mental Health Laws
Emergency Detention - Probable Cause Hearing - 72-hour Time
Limit
Dodge County v. Ryan
E.M., 2002 WI App 71
(filed 21 Feb. 2002) (ordered published 27 March 2002)
A police officer took the respondent to the Mendota Mental Health
Institute for an emergency detention after the respondent allegedly had
threatened to hurt himself and stated that he was depressed.
A probable cause hearing was held approximately 74 hours after the
respondent was detained. At the hearing the respondent moved to dismiss,
asserting that the hearing was not held within 72 hours as required by
Wis. Stat. section 51.20(7)(a). This statute requires a probable cause
hearing "within 72 hours after the individual arrives at the facility,
excluding Saturdays, Sundays and legal holidays." There is also a
provision for postponement at the detainee's request. The circuit court
denied the motion to dismiss and found probable cause to detain the
respondent.
In a decision authored by Judge Dykman, the court of appeals
reversed. The 72-hour rule described above is a "strict procedural
guideline" that is mandatory and a court loses competency to proceed
when there is a failure to comply with it. In reaching this conclusion,
the appellate court rejected the county's argument that time should be
computed in a case like this by counting days rather than hours and that
the first day of detention should not be counted at all.
Motor Vehicle Law
Implied Consent - Taking Blood Sample After Implied Consent
Refusal
State v. Marshall, 2002
WI App 73 (filed 5 Feb. 2002) (ordered published 27 March 2002)
In this case the court of appeals was confronted once again with the
issue of whether the implied consent law provides the exclusive remedy
upon a refusal to submit to evidentiary testing following an impaired
driving arrest such that law enforcement cannot obtain evidence by other
legal means. Relying on State v. Gibson, 2001 WI App 71, the
court concluded that the implied consent statute does not restrict the
police from using other constitutional means to collect evidence of a
driver's intoxication.
While the implied consent statute provides an incentive for voluntary
chemical testing, that is, not facing civil refusal procedures and
automatic revocation, voluntary testing is not the exclusive means by
which blood, urine, or breath samples may be constitutionally obtained.
See ¶ 13. While language in some earlier cases describes a
driver's "right" not to take the chemical tests, the court concluded
that such right of refusal is limited to the right to refuse to submit
to a voluntary chemical test. Such refusal, however, does not preclude
the police from proceeding with an involuntary test to obtain evidence
in support of an impaired driving charge.
Judge Fine and Judge Schudson submitted separate concurrences.
Municipal Law
Claims Against Police Officers - Attorney Fees
Murray v. City of
Milwaukee, 2002 WI App 62 (filed 28 Feb. 2002) (ordered
published 27 March 2002)
The plaintiff sought payment from the City of Milwaukee for legal
services he provided to Milwaukee police officers in connection with
citizen complaints filed against them. He has served as legal counsel
for Milwaukee police officers for many years. His complaint alleged that
it is the practice and policy of the City of Milwaukee to cover attorney
fees incurred by officers in their defense against citizen
complaints.
The circuit court dismissed the action, granting summary judgment in
favor of the city. In a decision authored by Judge Vergeront, the court
of appeals affirmed. It concluded that the complaint did not state a
claim for relief under Wis. Stat. section 895.35, because the statute
does not provide a cause of action for the payment of attorney fees.
Section 895.35 allows a municipality or county to pay an officer's
reasonable expenses incurred in defense of work-related claims if it
elects to do so (subject to the other conditions specified in the
statute). If the municipality refuses payment, the officer has no cause
of action against it under the statute. See Bablitch & Bablitch
v. Lincoln County, 82 Wis. 2d 574, 263 N.W.2d 218 (1978). Since
neither the attorney nor the officers he represented have a cause of
action against the City of Milwaukee under section 895.35, "it logically
follows that they do not have a cause of action under [the statute] even
if the City unreasonably denies payment. Therefore, even if we take the
allegations in the complaint as true - that the City had a practice and
policy of reimbursing attorney fees and costs incurred by officers in
connection with a defense against citizen complaints - neither [the
attorney] nor the officers have a viable claim for payment under [the
statute]" (¶ 11).
The plaintiff urged that because the statute uses the word "may" to
describe the municipality's option to pay the officer's reasonable
expenses, its decision to pay or not pay is subject to judicial review
based on a standard of reasonableness and equity. However, said the
court, "nothing in the statute suggests that this is the case" (¶
13).
The court also rejected the plaintiff's claims based on unjust
enrichment and quantum meruit.
Probate
Register in Probate - Duty to File And Keep All Papers Properly
Deposited
State ex rel. Reise v.
Morlen, 2002 WI App 83 (filed 6 Feb. 2002) (ordered published
27 March 2002)
The general guardian of an heir attempted to file a petition to
vacate or modify an order appointing a special administrator in an
estate proceeding. The register in probate declined to accept the
petition after determining that the guardian was not an interested party
to the action involving the estate. The guardian then filed what the
court of appeals characterized as a petition seeking mandamus to compel
the register to accept the guardian's petition for filing.
Responding to the petition, the register argued that the petition was
insufficient because the party filing it was not an interested party and
did not request the appointment of a guardian for the heir. The register
argued that evaluating pleadings in this manner is part of her duty to
file and keep properly deposited papers. The general guardian argued
that the register did not have authority to reject the petition and had
a plain legal duty to file the petition so that it might be heard by the
court.
In a per curiam opinion, the court of appeals agreed with the general
guardian. The register functions in both a clerical and quasi-judicial
capacity. He or she has a duty "to file and keep all papers properly
deposited with him or her." See Wis. Stat. § 851.72(1).
The register may refuse to accept any paper for filing until the fee is
paid. The statute does not, however, provide any other grounds for
rejecting a pleading, and the appellate court was not persuaded by the
register's argument that she has the authority to reject the general
guardian's petition for filing on the grounds she offered. Said the
court, "the Register's acceptance of pleadings for filing falls within
the Register's clerical functions, and the Register had a plain legal
duty to accept the [general guardian's] petition for filing" (¶
5).
Unemployment Compensation
Denial of Benefits - "Misconduct"
Lopez v. Labor and Industry
Review Comm'n, 2002 WI App 63 (filed 21 Feb. 2002) (ordered
published 27 March 2002)
The Labor and Industry Review Commission determined that the
plaintiff's physical assault of a coworker constituted "misconduct" and
denied him unemployment insurance benefits following his termination
from employment because of the assault. The plaintiff argued that the
physical assault was not misconduct because he was provoked by a
derogatory comment yelled at him by the coworker. This followed months
of harassing comments by the coworker about the plaintiff's national
origin and the employer's failure to stop the harassing behavior despite
the plaintiff's complaints.
A deputy commissioner for the Unemployment Insurance Division of the
Department of Workforce Development found that that the plaintiff's
discharge was for misconduct and that he was ineligible for unemployment
benefits. The plaintiff then sought a hearing before an administrative
law judge. The ALJ concluded that the plaintiff chose to escalate the
confrontation from name-calling to a physical assault, that he showed no
remorse for his actions, and that he indicated he might take similar
action in the future. The ALJ found that the plaintiff's actions
amounted to misconduct connected with his work. LIRC affirmed the ALJ's
findings and conclusion. The circuit court affirmed LIRC's decision.
In an opinion authored by Judge Vergeront, the court of appeals
affirmed. The court concluded that LIRC could reasonably decide that the
plaintiff's physical assault of another employee in reaction to
discriminatory harassing comments of a nonphysical nature was
misconduct, even though the employer may have failed to properly respond
to the plaintiff's past complaints. "While we agree with [the plaintiff]
that discriminatory working conditions are a serious matter, we reject
his conclusion that his reaction may not reasonably be considered
misconduct" (¶ 18).
Worker's Compensation
Compensable Injuries - "Second Injury" - Due Deference Standard
American Manufacturers Mut.
Ins. Co. v. Hernandez, 2002 WI App 76 (filed 13 Feb. 2002)
(ordered published 27 March 2002)
Hernandez suffered a "conceded work injury" while employed at
Walgreens. Although the injury healed well and Hernandez did not think
she needed to return to her treating physician, Walgreen's worker's
compensation insurer insisted that the doctor perform a final evaluation
of her injury. On the day of the scheduled appointment, Hernandez left
work at Walgreens to return home and change clothes. On her way to the
doctor's office, she was seriously injured in a car accident. She then
filed for temporary total disability; the insurer alleged that Hernandez
was not covered by the worker's compensation law.
Following a hearing, an ALJ ruled that her later injuries were a
"direct and natural result" of her prior compensable injury; thus, she
was covered. LIRC ultimately upheld the decision that Hernandez's later
car-related injuries were compensable, and the circuit court
affirmed.
The court of appeals, in an opinion written by Judge Nettesheim, also
affirmed. First addressing the applicable standard of review, the court
held that "due deference" to LIRC's "second injury" determination was
appropriate because the case presented a "novel" legal issue and LIRC
had not developed expertise on this question. The court found "eminently
reasonable" LIRC's determination that "Hernandez would not have been in
her vehicle on July 14 were it not for the request of ... Walgreen's
worker's compensation insurer that Dr. Doermann schedule a final
assessment with her" (¶24).
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