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    Wisconsin Lawyer
    February 01, 2018

    Court of Appeals Digest

    In this column, Profs. Daniel D. Blinka and Thomas J. Hammer summarize select published opinions of the Wisconsin Court of Appeals. Full-text decisions are linked below.

    Daniel D. Blinka & Thomas J. Hammer

    Real Property

    Option to Purchase – Purchase Price Method

    Headstart Bldg. LLC v. National Ctrs. for Learning Excellence Inc., 2017 WI App 81 (filed 8 Nov. 2017) (ordered published 20 Dec. 2017)

    HOLDING: An option to purchase a building specified a method to determine the purchase price with reasonable certainty.

    SUMMARY: A lease entered into by the lessor, Headstart Building, and the lessee, National Centers for Learning Excellence, included an option to purchase the property. The price was to be based on fair market value reflected in appraisals of the property. The option provided that each party would commission an appraisal, and the purchase price would be the average of the two appraisals, if they were within 5 percent of each other. Otherwise, the parties were to select a third appraiser, whose decision would presumably be the purchase price.

    National Centers for Learning Excellence exercised the option but the parties’ appraisals were “nowhere close,” largely because each appraiser looked at “different interests.” No third appraisal was conducted (see ¶ 2). This lawsuit followed. The circuit court dismissed Headstart Building’s claims on the ground that the parties had not agreed on the proper methodology; it also dismissed the counterclaims of National Centers for Learning Excellence.

    The court of appeals reversed in a majority opinion authored by Judge Hagedorn. The split between the appraisals centered on whether valuation ran to the “leased fee” or instead to the “fee simple interest in the property” (¶ 13). An option to purchase need not specify a price (see ¶ 18). The court found persuasive cases from other states that had found similar options “definite enough to enforce.” Given the differences between the two appraisals, the solution was a third appraisal. According to the court, “[t]he option is enforceable” (¶ 22).

    The court remanded the matter so the circuit court can properly address the remedy (see ¶ 24).

    Judge Reilly concurred but disagreed that the circuit court should determine which appraisal method to use (see ¶ 27). The parties are “sophisticated commercial business owners” who already selected the dispute resolution method, namely, a third appraisal (¶ 29).

    Worker’s Compensation

    Medical Opinions – “16-B” Reports – Medical License Revoked

    American Family Mut. Ins. Co. v. Haas, 2017 WI App 83 (filed 8 Nov. 2017) (filed 20 Dec. 2017)

    HOLDING: The revocation of a physician’s license did not render inadmissible in a worker’s compensation hearing a report about the claimant’s injuries the physician wrote while properly licensed to practice medicine.

    Daniel D. BlinkaProf. Daniel D. Blinka, U.W. 1978, is a professor of law at Marquette University Law School, Milwaukee.

    Thomas J. HammerProf. Thomas J. Hammer, Marquette 1975, is a law professor and Director of Clinical Education at Marquette University Law School, Milwaukee.

    SUMMARY: Haas was injured in 2001 while working, and his worker’s compensation benefits were not contested. In 2011, Dr. Cully White performed additional operations. White completed form 16-B reports (the certified practitioner’s reports on accident or industrial disease) that linked the later surgeries to the earlier injury and failed treatment. He wrote these reports in May 2011 and in October 2013. Later in 2013, White surrendered his medical license.

    At a 2015 hearing, an administrative law judge (ALJ) considered the insurer’s objection to the 16-B reports on grounds that they were inadmissible because White had lost his license. The ALJ overruled the objection, admitted the reports, and found them more credible than the insurer’s expert’s reports. The insurer appealed.

    The Labor and Industry Review Commission (LIRC) upheld the ALJ’s decision. The circuit court upheld LIRC’s decision.

    The court of appeals affirmed in an opinion authored by Judge Reilly. The 16-B reports were admissible under Wis. Stat. section 102.17(1)(d)1. and Wis. Admin. Code section DWD 80.22, “regardless of the doctor’s status at the time of the hearing” (¶ 6). The statute and the rule “permit a 16-B report to serve as prima facie evidence at a hearing as to ‘the matter contained [in] those reports’ so long as the doctor consents to and is available for cross-examination” (¶ 8).

    Because White was licensed when he performed the surgery and wrote the reports, his opinions were admissible via the reports (see ¶ 9). Any concerns regarding White’s license status ran to the weight of the evidence, not its admissibility.

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