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    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.

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    Wisconsin LawyerWisconsin Lawyer
    Vol. 80, No. 5, May 2007

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    Malpractice - "Actual Innocence"

    Tallmadge v. Boyle, 2007 WI App 47 (filed 21 Feb. 2007) (ordered published 28 March 2007)

    Tallmadge was convicted in California of several counts of sexual abuse. His family trust retained a Wisconsin attorney, Boyle, to assist Tallmadge with various matters, including pursuing habeas corpus relief. The attorney fees were paid from the trust but Tallmadge was the client. Tallmadge later fired Boyle and filed this action for legal malpractice while also demanding return of the fees paid by the trust. The circuit court dismissed the complaint.

    The court of appeals, in an opinion authored by Judge Wedemeyer, affirmed. Although the parties vigorously contested the quality of legal services provided, these disputes were immaterial because of the actual innocence rule set forth in Hicks v. Nunnery, 2002 WI App 87. "There is nothing in this record to demonstrate that Tallmadge could prove that any action or inaction by Boyle caused him any recoverable injury. In a situation where a criminally convicted defendant files a legal malpractice lawsuit, the injury is different than in non-criminal settings. In order to prove causation, the convicted criminal must show that, but for his former attorney's conduct, he would have been successful in the criminal lawsuit. Success in this context is not merely to have a court grant a motion or even order a new trial. Success in this context is a get out of jail free card. Thus, success here means proving to a jury that the convicted criminal is innocent of all fifteen counts for which he was convicted. Hicks clearly declares this to be the law in Wisconsin" (¶ 20).

    The court also explicitly rejected Tallmadge's contention that Hicks should be limited to legal malpractice actions against trial counsel and thus should not apply to postconviction counsel. "There is nothing in the Hicks case which limits the public policy application of the `actual innocence' requirement to only those criminal defendants who are suing their former trial attorneys for legal malpractice. Rather, the language is quite clearly more general and dependent on public policy factors which apply equally to cases involving criminal defense attorneys hired to represented [sic] criminal defendants after conviction" (¶ 21).

    The court also rejected Tallmadge's arguments relating to the return of attorney fees. The trustee, not the beneficiary (here Tallmadge), is the proper party to demand their return (see ¶ 24). The court declined to extend a narrow exception relating to conflicts of interests and will contests to a scenario such as this one.

    Judge Fine concurred, writing separately to emphasize that the two issues - legal malpractice and return of fees - were distinct and that demands for disgorgement of unearned fees did not turn on the client's actual innocence.

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    Civil Procedure

    Summary Judgment - Timeliness - Local Rules

    Hunter v. AES Consultants Ltd., 2007 WI App 42 (filed 7 Feb. 2007) (ordered published 28 March 2007)

    The Hunters filed suit over a dispute regarding environmental remediation services. The circuit court granted summary judgment in favor of the defendants after the Hunters filed their responsive submissions, which were "late according to the Walworth County Circuit Court Rules and an attachment to the court's scheduling order restating those rules" (¶ 1). The submissions were, however, within the time limits established by Wis. Stat. section 802.08(2).

    The court of appeals, in an opinion written by Judge Anderson, reversed. The court said that the local rules impermissibly conflicted with the statute. The defendants argued "that the trial court's scheduling order required the Hunters to file their responsive submissions within twenty days of service of the motion for summary judgment" (¶ 13). According to the court of appeals, "the court's time requirements are not spelled out in the scheduling order itself. Rather, the time requirements are laid out in an attachment to the order entitled `Standard Summary Judgment Procedure' that is a nearly verbatim recitation of the Walworth County Circuit Court Rules. Therefore, the scheduling order, via the attachment, simply enforces the local rules. Again, these rules are precluded as being in conflict with the uniform rule contained in Wis. Stat. § 802.08(2)" (id.).

    The court of appeals acknowledged that the "five-day rule of Wis. Stat. § 802.08(2) is not an inflexible doctrine" and permits trial courts to "adjust the time requirements." Yet, such deviations must reflect "the sound exercise of discretion" (¶ 14). "Here, however, we have no record of such an exercise of discretion. We have only a standard attachment to a scheduling order that recites local court rules at odds with the five-day rule of Wis. Stat. § 802.08(2). This practice of simply appending such local rules without any showing of an exercise of discretion violates the supreme court's expressed intent to bar application of local court rules conflicting with § 802.08(2) and to impose statewide uniformity of practice. For this reason, we hold that, with regard to scheduling orders, trial courts that deviate from the statutory time requirements for responding to a motion for summary judgment should explain on the record why that deviation is necessary and appropriate. We appreciate that this places a burden on trial courts, but without this requirement courts could make an end-run around § 802.08(2) and continue to enforce local rules through their scheduling orders" (¶ 15).

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    Criminal Law

    Lesser Included Offenses - Attempted First-degree Intentional Homicide and First-degree Recklessly Endangering Safety - Procedure on Conviction of Both Greater and Lesser Included Crimes

    State v. Cox, 2007 WI App 38 (filed 14 Feb. 2007) (ordered published 28 March 2007)

    The defendant was charged with attempted first-degree intentional homicide (Wis. Stat. §§ 940.01, 939.32) and endangering safety by use of a dangerous weapon (Wis. Stat. § 941.20(2)(a)). At the conclusion of the evidence at his jury trial, the court gave instructions on these two charges and also on first-degree recklessly endangering safety (Wis. Stat. § 941.30(1)) (reckless endangerment), which, for reasons indicated below, is a lesser included offense of attempted first-degree intentional homicide. The court gave no jury instruction explaining that reckless endangerment is a lesser included offense of attempted homicide. The jury convicted the defendant on all three charges, and the court sentenced the defendant on the three charges.

    The defendant moved for postconviction relief, claiming that the court erred in convicting him of both a greater and a lesser offense (attempted homicide and reckless endangerment). The circuit court agreed and vacated the reckless endangerment conviction (although the defendant argued that the attempted homicide charge should be vacated). In a decision authored by Judge Brown, the court of appeals affirmed.

    In situations in which one charged offense is a lesser-included offense of another charged offense under the lesser included crimes statute (Wis. Stat. § 939.66), the legislature has declared that a person may be convicted of one or the other offense but not both. The appellate court concluded that "it is settled law that first-degree reckless endangerment under Wis. Stat. § 941.30(1) is a lesser included offense of attempted first-degree intentional homicide under Wis. Stat. § 940.01(1). State v. Weeks, 165 Wis. 2d 200, 205-06, 477 N.W.2d 642 (Ct. App. 1991); see also Hawthorne v. State, 99 Wis. 2d 673, 682, 299 N.W.2d 866 (1981) (holding the former analogous crime of endangering safety by conduct regardless of life a lesser included offense of the former analogous crime of attempted first-degree murder). That is, first-degree reckless endangerment does not require proof of any fact in addition to those required for attempted first-degree intentional homicide, see Wis. Stat. § 939.66(1), and a defendant cannot be punished under both statutes for the same act. Sec. 939.66; Hawthorne, 99 Wis. 2d at 680-82. We thus agree with [the defendant] and the circuit court that it was error to convict and sentence [the defendant] under both statutes" (¶ 8).

    The appellate court next addressed whether the defendant was harmed by these errors and whether the circuit court's remedy of vacating the reckless endangerment conviction eliminated any harm sustained by the defendant. It concluded that "Hawthorne and Weeks stand for the proposition that it is impossible to commit attempted homicide without also committing first-degree reckless endangerment.... The Hawthorne/Weeks holding that protects [the defendant] from being convicted of both offenses also forecloses his claim that the guilty verdict on the lesser crime somehow calls into question the validity of the guilty verdict on the greater. No new trial is called for" (¶ 14). "Vacating the lesser conviction is a reasonable remedy because a jury following the correct procedure would end its deliberations after finding guilt on the greater offense and never reach the lesser" (¶ 15).

    Lastly, the court addressed and rejected the defendant's argument that the "rule of lenity" requires that judgment be entered on the lesser included offense of reckless endangerment rather than on the greater offense of attempted homicide. The rule of lenity is a rule of construction applied to ambiguous criminal statutes, and the defendant provided no authority recognizing the rule as having any application outside the realm of statutory construction (see id.).

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    Criminal Procedure

    Truth-in-Sentencing - Reconfinement Hearings after Revocation of Extended Supervision - Defendant's Right of Allocution

    State v. Hines, 2007 WI App 39 (filed 21 Feb. 2007) (ordered published 28 March 2007)

    The defendant's extended supervision terms for sentences imposed under the truth-in-sentencing statutes were revoked, and he was returned to court for a reconfinement hearing. At that hearing the court heard argument by the state and by defense counsel, and it allowed the defendant's fiancée to speak on the defendant's behalf. The court then announced the reconfinement terms. After the reconfinement sentences were announced, the defendant requested and was given permission to address the court regarding the sentences. However, the court did not alter them in the wake of his remarks. The circuit court also denied the defendant's postconviction motion challenging his reconfinement sentences.

    The critical issue before the court of appeals was whether the circuit court erroneously exercised its discretion when it failed to allow the defendant to allocute before the imposition of the reconfinement sentences. In a decision authored by Judge Kessler, the court of appeals concluded that the circuit court had erred.

    In 2006 the Wisconsin Supreme Court decided State v. Brown, 2006 WI 131, 725 N.W.2d 262, in which the court reaffirmed the decision in State v. Swiams, 2004 WI App 217, 277 Wis. 2d 400, 690 N.W.2d 452. Swiams held that a reconfinement hearing is "closely akin" to a sentencing hearing "because both determine whether a person should be sent to prison and for how long." Brown, 2006 WI 131, ¶ 28 (citing Swiams, 277 Wis. 2d 400, ¶ 22). In the present case the appellate court concluded that "[p]art of the court's consideration at a sentencing includes the defendant's right to allocute before the court pronounces its decision. See Wis. Stat. § 972.14(2); [State v.] Greve, 272 Wis. 2d 444, ¶ 35" (¶ 18) (emphasis in original). Accordingly, because the defendant had a right of allocution that was denied at his reconfinement hearing, the court of appeals reversed and remanded this case to the circuit court for a new reconfinement hearing.

    Cancellation of Trial Within Two Days of Jury Trial Date - Assessment of Jury Fees Against State

    Flottmeyer v. Circuit Ct. for Monroe County, 2007 WI App 36 (filed 15 Feb. 2007) (ordered published 28 March 2007)

    Trial of this domestic abuse case was scheduled for Nov. 30, 2005. Approximately two to three weeks before this date, the prosecutor was informed that a key witness, the alleged victim, had moved to Chicago, but the witness also indicated to the state's victim-witness coordinator that she intended to appear at the trial. In addition, the witness's subpoena had been returned. Late in the afternoon on Nov. 28, the prosecutor was informed that the witness had contacted the district attorney's office by telephone and said that she would not appear for the trial. The prosecutor informed the circuit court of this development that same afternoon, less than two days before the scheduled trial. After a hearing held on Nov. 30, the circuit court assessed jury fees of $250 against the state (not against the prosecutor or the county district attorney's office) under Wis. Stat. section 814.51 for the cancellation of the trial. In pertinent part, this statute provides that "[t]he court shall have discretionary authority in any civil or criminal action or proceeding … to assess … juror fees ... against either the plaintiff or defendant … if a jury demand … is … withdrawn within 2 business days prior to … the commencement of the trial." The state appealed.

    In a decision authored by Judge Lundsten, the court of appeals affirmed. It concluded that the term "plaintiff" in Wis. Stat. section 814.51 is an express reference to the state for purposes of what is known as the Martineau rule. (The Martineau case held that "costs may not be taxed against the state or an administrative agency of the state unless expressly authorized by statute." Martineau v. State Conservation Comm'n, 54 Wis. 2d 76, 79, 194 N.W.2d 664 (1972).) Accordingly, in this case, the appellate court rejected the state's argument that the circuit court lacked authority to impose jury fees against the state.

    (In a footnote the court observed that "Wis. Stat. § 814.51 requires that `a jury demand has been made … and … is later withdrawn.' Thus, the State might have argued that it did not make or withdraw a jury demand because the State does not make or withdraw jury demands in criminal cases. Such an argument, however, would seem foreclosed by [State v. Foster, 100 Wis. 2d 103, 301 N.W.2d 192 (1981)] which broadly construes the statute's requirement that a jury demand be `made' and `later withdrawn.' Specifically, the Foster court said that the statute authorizes the circuit court to assess jury fees `when a jury trial date has been established and the parties have failed to give the court reasonable notice of a cancellation of the jury proceeding.' Id. at 108" (¶ 13 n. 6).]

    The court of appeals also concluded that the circuit court did not misuse its discretion in the assessment of jury fees. Among other things the circuit court found that the prosecutor's office could have done more to determine the willingness and ability of the witness to appear and to avoid giving the court the late notice described above. "Without expressly saying so, the circuit court concluded that the district attorney's office could have stayed in closer contact with the witness in the time period immediately before trial" (¶ 22).

    The circuit court also noted that it had had problems of this type with the prosecutor's office in the past and that, for the week in question in this case, two additional jury trials were cancelled. With respect to this reason, the appellate court remarked that "[t]he circuit court's reasoning was simply that, given all the cancellations, each cancellation was a problem. Cf. House [v. Circuit Court for Marinette County], 112 Wis. 2d at 18 (one factor in assessment of jury fees was whether other judicial matters could have been scheduled on the trial date)" (¶ 27).

    Earned Release Program - Determining Eligibility for Inmates Serving Terms of Confinement Imposed Before July 26, 2003

    State v. Johnson, 2007 WI App 41 (filed 6 Feb. 2007) (ordered published 28 March 2007)

    Section 302.05 of the Wisconsin Statutes establishes the substance abuse treatment program administered by the state Department of Corrections (DOC). Part of this initiative is what is known as the earned release program (ERP). An inmate serving the confinement portion of a bifurcated sentence who successfully completes the ERP will have his or her remaining confinement period converted to extended supervision, although the total length of the sentence does not change.

    Section 302.05(3)(e) governs petitions for the determination of eligibility for the ERP by inmates who were sentenced before the statute's effective date, July 26, 2003. Section 302.05(3)(e) provides the procedure to be followed and states in relevant part: "If an inmate is serving the term of confinement portion of a bifurcated sentence imposed under s. 973.01, the sentence was imposed before July 26, 2003, and the inmate satisfies the criteria under par. (a) 1., the inmate may, with the department's approval, petition the sentencing court to determine whether he or she is eligible or ineligible to participate in the earned release program under this subsection…." (emphasis added). (Editors' Note: For defendants given bifurcated sentences on and after July 26, 2003 for crimes other than those codified in Wis. Stat. chapter 940 and certain crimes against children codified in chapter 948, the court determines at sentencing whether the defendant is eligible to participate in the ERP.)

    When the ERP was originally established, the DOC implemented a policy that inmates who were sentenced before July 26, 2003 would "not be considered for the [ERP] at this time" (¶ 15). The record contains no evidence that this policy has been suspended or changed in the interim and, at oral argument in this case, the state represented that this policy remains in effect (see id.). The defendant in this action was serving a bifurcated sentence imposed before July 26, 2003, and she petitioned the circuit court to determine whether she was eligible for the ERP. The circuit court denied the motion, finding that the DOC, pursuant to the policy described above, had not approved her filing the petition as required by section 302.05(3)(e).

    In a decision authored by Judge Kessler, the court of appeals reversed. The court first concluded that "the DOC approval required by § 302.05(3)(e) is merely a determination that the petitioner is not statutorily excluded from eligibility for ERP, and the exercise of discretion as to whether the inmate should be included in ERP eligibility is a matter for the trial court" (¶ 14). The court further held "that the DOC's policy of refusal to take action on inmate petitions brought pursuant to Wis. Stat. § 302.05(3)(e) must constitute approval for purposes of the statute. To hold otherwise would make a mockery of the legislative determination that an inmate sentenced prior to July 26, 2003, has a right to petition the court for ERP eligibility" (¶ 17).

    Accordingly, the court of appeals reversed the circuit court's order dismissing the defendant's petition and remanded this case for a determination by the circuit court of the defendant's eligibility for the ERP (see ¶ 19).

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    Employment Law

    Whistleblowers - Wrongful Discharge - Sarbanes-Oxley

    Repetti v. Sysco Corp., 2007 WI App 49 (filed 28 Feb. 2007) (ordered published 28 March 2007)

    The plaintiff brought a wrongful discharge claim against Sysco, alleging he was fired for challenging the company's revenue reporting practices. In dismissing the complaint, the circuit court rejected the plaintiff's contention that his discharge fit within a public policy exception, rooted in Sarbanes-Oxley, to the employment-at-will doctrine. The court of appeals affirmed the circuit court.

    "Sarbanes-Oxley provides whistle blowing employees with recourse to regain a former position and to receive redress for wrongful termination. Indeed, Sarbanes-Oxley entitles the wrongfully discharged employee to `all relief necessary' to make himself or herself whole. 18 U.S.C. § 1514A(c) (emphasis added). Thus, this is not a case where, absent the application of the wrongful discharge public policy exception, an employee is left without options. See Hausman [v. St. Croix Care Center], 214 Wis. 2d at 670-71. Repetti could have availed himself of the Sarbanes-Oxley protections and relief, but chose not to do so" (¶ 11).

    Although "Wisconsin does not have a pertinent state whistleblower statute similar to Sarbanes-Oxley … our supreme court has consistently held that it will not imply a wrongful discharge cause of action to uphold a public policy when the legislature has already provided adequate mechanisms for vindication of that policy" (¶ 13).

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    Family Law

    Divorce - Grandparent Visitation

    Rogers v. Rogers, 2007 WI App 50 (filed 21 Feb. 2007) (ordered published 28 March 2007)

    The parents of two minor children divorced in 2005. The divorce judgment ordered joint custody, with primary placement to the mother. The father's placement essentially consisted of every other weekend, one week in the summer, and an every-other-year holiday rotation.

    The children had lived with their paternal grandparents for nine months in 2003, at the grandparents' expense, while the family relocated from Missouri to Wisconsin. When the children resumed living with their parents, the grandparents saw the children several times a month. After the divorce, the mother permitted the grandparents to continue to see the children at their school events and to take them out for meals, but overnight visitation fell off. The mother offered weekday time when the children were off from school, which the grandparents always accepted.

    The paternal grandparents moved for a visitation order pursuant to Wis. Stat. section 767.245 (2003-04) (since renumbered as section 746.43). At the hearing on the motion, the grandfather testified that the grandparents wanted regularly scheduled visitation with the children for one weekend a month and a week in the summer. They also wanted the weekend visits carved out from the mother's placement time. The grandparents never asked their son (the father) if they could have the children with them during his time. The mother agreed that the relationship between the children and their grandparents was positive and in the children's best interest to maintain.

    The circuit court found that the grandparents had a parent-like relationship with the children stemming from having fully cared for them in 2003 and that the divorce was the mechanism triggering the visitation statutes. The court also found that the contact the mother had already fostered between the children and their paternal grandparents was sufficient to maintain their existing good relationship. The court concluded that because the mother had not denied visitation with the grandparents, there was no basis or need for a visitation order. The grandparents appealed (see ¶ 6).

    In a decision authored by Judge Nettesheim, the court of appeals affirmed. The visitation statute lays out three conditions that must be satisfied before a circuit court may grant visitation: 1) the grandparents must have a parent-like relationship with the child, 2) the parents must have notice of the hearing, and 3) the court must determine that grandparent visitation is in the child's best interest. The grandparents read the circuit court's ruling to say that a court cannot order grandparental placement unless visitation is denied, and they argued that the statute does not impose that requirement. They contended that once the three statutory conditions are met, the petition must be granted, and that the court erred by fashioning a new requirement (see ¶ 11).

    The court of appeals concluded that the grandparents overread the circuit court's holding and misconstrued the controlling law. "First, the statute's stated conditions do not guarantee that a visitation order will issue where the statutory elements are satisfied. To the contrary, the decision clearly remains within the court's discretion even where the statutory elements are met" (¶ 12). (The statute provides that the "the court may grant reasonable visitation rights" to the petitioner.) "Second ... the grandparents did not satisfy the `best interest of the child' element of the statute. Finally, the court's pronouncement is not as broad as the grandparents suggest. The court did not say, as a matter of law, that a parent's allowance of any degree of grandparent visitation bars a visitation order. To the contrary, the court spoke to `the elements and facts of this case,' saying there was `no basis upon which this Court should,' not could, order placement" (¶ 12).

    Parents have a liberty interest in directing the care, custody, and control of their children, and the due process clause does not permit a state to infringe on a fit parent's fundamental right to make child-rearing decisions simply because a court disagrees with the parent or believes a better decision could be made. See Troxel v. Granville, 530 U.S. 57 (2000). In Roger D.H. v. Virginia O., 2002 WI App 35, 250 Wis. 2d 747, 641 N.W.2d 440, the court of appeals drew two lessons from Troxel: "first, that due process requires courts to presume that a fit parent's decision regarding nonparental visitation is in the child's best interest and, second, that we may read this requirement into a nonparental visitation statute even when the statute is silent on the topic" (¶ 20).

    In this case the grandparents see the children at their school and sporting activities, take them out for meals, and also sometimes see the children during the week when they are off from school. The guardian ad litem and the court evaluator both advised against formalizing placement because the best interests of the children did not require it. The circuit court agreed that a continued relationship with the grandparents was in the children's best interest, but noted that the mother already permits the grandparents to have "considerable contact with [their] grandchildren, albeit not as much as they desire" (¶ 21).

    Said the appellate court, "[w]e construe the grandparents' desire to secure a more generous and predictable visitation schedule as falling into the category of fashioning a `better' arrangement. But that is not enough to overcome the presumption that [the mother's] visitation decisions are in her children's best interests and thus bar state intervention. We agree with the circuit court that the informal arrangement is sufficient to maintain the established relationship and that state interference in the form of court-ordered placement with the grandparents is unwarranted" (id.). "We hold that the grandparents did not rebut the presumption that the decision of the mother, a fit parent with primary placement, regarding the existing visitation sufficiently served the best interests of the children"(¶ 1).

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    "Other Insurance" - Self-insured

    Brown County v. OHIC Ins. Co., 2007 WI App 46 (filed 27 Feb. 2007) (ordered published 28 March 2007)

    This insurance coverage dispute arose out of the death of a patient at a county health care facility. The county carried two policies, one with Wisconsin Municipal Mutual Insurance Co. (WMMIC) and another with OHIC, both of which provided primary coverage. The WMMIC policy provided liability coverage and required the county to pay the first $100,000 as a "self-insured retention." The OHIC policy provided full coverage for liability up to $1 million. The county paid $100,000 to WMMIC in the underlying patient-death case; WMMIC and OHIC both then contributed toward a settlement. The county sought repayment of its $100,000 from OHIC, which denied the claim based on its "other insurance" clause. The county sued OHIC and the circuit court granted summary judgment to the insurer.

    The court of appeals, in an opinion written by Judge Peterson, reversed. "The result in this case hinges on whether the County's self-insured retention agreement with WMMIC was `other insurance' for purposes of the OHIC other insurance clause. OHIC concedes that if the County's agreement with WMMIC was not `other insurance,' it is liable for the first $100,000 of Rohr's claim. We conclude the OHIC policy is ambiguous as to whether the County's agreement with WMMIC was `other insurance,' and therefore construe the OHIC policy as providing coverage" (¶ 10).

    "We are required to view this language from the position of a reasonable insured in the place of the County. From the County's perspective, the only question that matters is who is liable: the County or someone else. The County's policy with WMMIC characterized the County's obligation as self-insurance, but from the County's perspective the policy could just as well have stated there was `no coverage' for the first $100,000 of a given claim. A contrary result would in effect allow OHIC to graft WMMIC's policy language into its other insurance clause. That is, even though the County's arrangement with WMMIC operated in exactly the same way as a deductible, OHIC is asking this court to find WMMIC's use of the term `insurance' to describe the $100,000 dispositive. We decline to do so. OHIC had the opportunity to define `other insurance' to include payments made by its own policyholder. It failed to do so" (¶¶ 15-16). The court distinguished several cases relied on by the circuit court.

    Subrogation - "Made Whole"

    Muller v. Society Ins., 2007 WI App 44 (filed 20 Feb. 2007) (ordered published 28 March 2007)

    The Mullers' store was destroyed by a fire that started during a remodeling project. They sued the electrical contractor, Jerrick, and its insurer, United Fire & Casualty. The Mullers also carried a $1 million policy issued by Society Insurance, which paid out about $400,000 on which it asserted subrogation rights. Three mediations took place. In the first, Jerrick, United, and Society settled Society's subrogation claim for $190,000, pending trial or settlement of the Mullers' claims. In the second mediation, the Mullers settled their claims with Jerrick and United for $120,000 but asserted additional losses not covered by Society. The circuit court ruled that to the extent that the Mullers were not made whole by their payments from Society and the settlement with Jerrick and United, they were entitled to the difference. A third mediation resulted in an agreement that the Mullers had about $60,000 in additional losses that were not so covered. The circuit court entered judgment for this amount against Society. Both sides appealed. Society contended that it should not be forced to disgorge any part of its $190,000 settlement with United, and the Mullers argued they were entitled to the entire amount.

    In a decision authored by Chief Judge Cane, the court of appeals reversed. "The presented [sic] case is distinguishable on two points from cases in which courts have held the funds were limited, which created competition that prevented the insured from being made whole. First, the one million dollar policy limit was far more than adequate to cover all the claims. [In] the cases in which the funds were limited there were clearly insufficient funds to cover the damages claims. While we do not hold policy limits are per se the measure of whether a fund is limited, policy limits are certainly a significant factor in determining whether limited funds exist. In this case, those limits were one million dollars, which would have clearly covered the Mullers' damages. Second, the amount which could have been recovered was not limited by either Society or the Mullers. The Mullers characterize Society's tentative agreement as an underhanded tactic, which inhibited their ability to fully settle their claims. The tentative settlement was contingent upon the resolution of the Mullers' claims and was not implemented until after they released their claims. We fail to see how a tentative agreement, expressly contingent upon the insured resolving its claims, inhibits the insured's ability to be made whole…. [T]he Mullers did not agree to indemnify Jerrick against Society in their agreement. Where there are sufficient funds to cover all the losses, where there are no indemnification agreements, and where there is an opportunity to recover from those funds, there is not a limited fund. Through their settlement, the Mullers made a conscious choice to accept less than their losses. However, this choice cannot plausibly be tied to any limited funds. It is interesting to note, had Society chose[n] not to pursue its subrogation claim against Jerrick and United, the Mullers would not be able to recover any more monies. Because they have not established in the absence of subrogation the amount of Society's settlement that would have gone towards the satisfaction of their damages, the Mullers are not entitled to more money simply because Society pursued its subrogation claims"

    (¶¶ 16-18). From the conclusions above it also followed that the Mullers were not entitled to the full subrogation settlement between Society and United.

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    Recreational Use Immunity - Occupier

    Held v. Ackerville Snowmobile Club Inc., 2007 WI App 43 (filed 21 Feb. 2007) (ordered published 28 March 2007)

    A snowmobile club, Ackerville, maintained a trail that cut across the private property of landowners who had given the club permission to use the trail. While grooming the trail using a special sled called a drag, the club's towing vehicle broke down. The drag was left on the trail until members could return with a functioning vehicle. In the meantime, two people riding a snowmobile crashed into the drag, which had been left on the trail, allegedly without any warnings. The plaintiffs sued Ackerville for negligence, but the circuit court granted summary judgment and dismissed the complaint based on recreational use immunity.

    The court of appeals, in an opinion written by Judge Snyder, affirmed. The plaintiffs argued that immunity did not attach to "temporarily abandoned equipment that is unrelated to the condition of the land" (¶ 7). The recreational use immunity statute does not, however, distinguish between active and passive negligence. "Under Wis. Stat. § 895.52, claims for passive negligence, such as Ackerville's alleged failure to retrieve the grooming equipment, are no more viable than claims for active negligence, such as Ackerville's alleged decision to leave the disabled equipment partially on the trail in a blind curve. Furthermore, all of the acts alleged are related to the condition or maintenance of the snowmobile trail. Had there been no recreational snowmobiling trail on the land, Ackerville would not have had grooming equipment there. Finally, as we have already stated, the law must be liberally construed in favor of immunity" (¶ 13).

    The plaintiffs also unsuccessfully argued that Ackerville was not an "occupier" of the land within the meaning of section 895.52. "Here, Ackerville was engaged in ongoing trail maintenance on the property. It had not abandoned the trail, but maintained the trail during the snowmobiling season when snowfall levels would allow. The relevant facts here are substantially similar to those in [prior cases], and we comfortably draw the analogy. Ackerville occupied the land and thus enjoys immunity under the statute" (¶ 18).

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