Vol. 73, No. 8, August
2000
Supreme Court Digest
by Prof. Daniel D. Blinka & Prof. Thomas J.
Hammer
Note: Each case summarized in the Supreme Court
Digest includes its new public domain citation.
| Civil Procedure | Corporations |
Criminal
Law | Criminal Procedure |
Debtor-creditor Law | Employment Law |
Family Law | Insurance | Labor
Law |
Municipal Law | Torts | Zoning |
Civil Procedure
Docketing Judgments - Actions Against County Clerk for Failure to
Docket at Proper Time - Statute of Limitations
South Milwaukee Savings Bank v.
Barrett, 2000 WI 48 (filed 9 June 2000)
Wis. Stat. section
806.10(3) provides that a clerk of circuit court who neglects to
docket a judgment "at the proper time" shall be liable in damages to an
injured party. A judgment is "docketed" when the clerk places the
information about the judgment in the judgment docket. This is to be
distinguished from "entry" of a judgment that occurs when the judgment
is filed in the office of the clerk of court.
In this case, the supreme court considered the statute of limitations
for a claim brought under section
806.10(3). In a unanimous decision authored by Chief Justice
Abrahamson, the court concluded that the six-year statute of limitations
under section
893.93(1)(a) applies in these types of actions.
The court also considered what the statute means when it refers to a
clerk of circuit court neglecting to docket a judgment "at the proper
time." The court concluded that to neglect to docket a judgment "at the
proper time" means to neglect to docket the judgment immediately upon
entry of the judgment. This is particularly significant in a race-notice
jurisdiction like Wisconsin, where prompt docketing of judgments is
needed to establish the proper priority of claims.
In this case, the clerk neglected to docket a judgment at the proper
time when the judgment was entered at approximately 3:30 p.m. on one day
but was not docketed until 9 a.m. on the following day.
Corporations
Mergers - Valuation of Dissenters' Shares - Minority Discounts -
Unfair Dealing
HMO-W Inc. v. SSM Health Care
System, 2000 WI 46 (filed 7 June 2000)
Wisconsin law allows a minority shareholder to dissent from a
fundamental corporate action, such as a merger, and to receive the fair
value of those minority shares. See Wis. Stat. §180.1302(1).
If the shareholder expresses dissatisfaction with the payment of shares
offered by the corporate entity and complies with appropriate
procedures, a corporation may institute a special proceeding and
petition the court to make a binding determination as to the fair value
of the shares.
The first issue considered by the supreme court in this decision was
whether a minority discount may apply in determining the fair value of a
dissenter's shares. A "minority discount" addresses the lack of control
over a business entity on the theory that noncontrolling shares of stock
are not worth their proportionate share of the firm's value because they
lack voting power to control corporate actions. In a unanimous decision
authored by Justice Bradley, the supreme court concluded that minority
discounts may not be applied to determine the fair value of dissenters'
shares in an appraisal proceeding. Application of a minority discount in
determining the fair value of dissenters' shares frustrates the
equitable purpose of protecting minority shareholders.
The court also considered whether a fair value determination of a
dissenter's shares may include consideration of unfair dealing in the
valuation of those shares. In this appraisal action this issue was
raised as an affirmative defense; the minority shareholders did not
plead breach of fiduciary duty nor did they seek damages based on such a
breach. The supreme court concluded that a court determining the fair
value of shares subject to appraisal must consider "all relevant
factors." These factors may include evidence of unfair dealing affecting
the value of a dissenter's shares.
Justice Bablitch did not participate in this decision.
Special Litigation Committees - Independence
Einhorn v. Culea, 2000 WI 65
(filed 22 June 2000)
The circuit court dismissed the derivative shareholder action brought
by Einhorn, a minority shareholder and member of the board of directors
of Northern Labs. The circuit court ruled that the threshold for
determining whether a member of the special litigation committee is
independent within the meaning of Wis. Stat. section180.0744 (1997-98)
is "extremely low" and found that the special litigation committee was
independent. The court of appeals affirmed the circuit court's judgment,
"concluding that the circuit court's assessment of whether each member
of the special litigation committee was independent was based on facts
supported by the record and was not clearly erroneous."
The supreme court, in a decision written by Chief Justice Abrahamson,
reversed. The issue raised in the case "was the proper interpretation
and application of the standard set forth in Wis. Stat. §180.0744
of whether a member of a special litigation committee is independent."
Thus, the issue on appeal was not the likelihood that the derivative
action would succeed, but whether the derivative action should be
dismissed on the basis of the decision of the special litigation
committee. The supreme court held that both lower courts erred "in
declaring that the threshold established by the legislature in
§180.0744 in determining whether a member of a special litigation
committee is independent is 'extremely low.'"
Addressing an issue of first impression, the court also held that "in
deciding whether members of the special litigation committee are
independent, the circuit court should determine whether, considering the
totality of the circumstances, a reasonable person in the position of
the member of the special litigation committee can base his or her
decision on the merits of the issue rather than on extraneous
considerations or influences. In other words, the test is whether a
member of the committee has a relationship with an individual defendant
or the corporation that would reasonably be expected to affect the
member's judgment with respect to the litigation at issue." The case was
remanded for further proceedings not inconsistent with the court's
opinion.
Criminal Law
Exposing Minors to Harmful Materials Over the Internet -
Constitutionality of Wis. Stat. section 948.11(2)
State v. Weidner, 2000 WI 52
(filed 16 June 2000)
Wis. Stat. section
948.11(2)(a) provides that "whoever, with knowledge of the nature of
the material, sells, rents, exhibits, transfers or loans to a child any
harmful material [including representations of sexually explicit
conduct], with or without monetary consideration, is guilty of a Class E
felony." The statute does not require the state to prove that the
defendant knew the age of the person receiving the harmful material.
Rather, it codifies an affirmative defense that places upon the
defendant the burden of proving that the defendant had reasonable cause
to believe that the child had attained the age of 18 years and the child
exhibited to the defendant a draft card, driver's license, birth
certificate, or other official or apparently official document
purporting to establish that the child had attained the age of 18
years.
In this case, the defendant used Internet technology to send sexually
explicit pictures to a minor. Though only 16 at the time, the child who
received these transmissions via a chatroom informed the defendant that
she was 17. All interaction between the two occurred over the Internet
and did not involve any face-to-face contact.
The defendant was charged with several counts of violating section
948.11(2). The circuit court dismissed the prosecution, reasoning
that because the statute shifts to the defendant the burden of proving
knowledge of the victim's age and the Internet does not provide the
requisite face-to-face contact to ascertain whether the victim is a
minor, the statute is unconstitutional.
In a unanimous decision authored by Justice Bradley, the supreme
court concluded that because the state does not bear the burden of
proving that the defendant knew the age of the minor, section
948.11(2) is unconstitutional in the context of the Internet and
other situations that do not involve face-to-face contact. The statute
essentially sets forth a strict liability offense that deprives an
individual of the opportunity to prove lack of knowledge. Persons
employing the Internet lack the means to reasonably ascertain the age of
the persons with whom they are corresponding. There is an absence of
both face-to-face contact and a satisfactory degree of reliability.
Thus, the statute renders it virtually impossible for defendants as
Internet users to meet the burden of proving the affirmative defense
described above. Although the court's analysis centered exclusively on
the Internet, it indicated that its holding would apply equally to mail,
fax, and other situations devoid of face-to-face contact. The court
further concluded that the statute could not be salvaged by judicial
construction.
Videotaping Nudity - Constitutionality
State v. Stevenson, 2000 WI
71 (filed 28 June 2000)
Stevenson was convicted of two counts of making videotapes of a nude
person without her consent, contrary to Wis. Stat. section
944.205(2)(a). The person depicted was Stevenson's ex-girlfriend. He
made the tapes by "peeping" through her windows from various
perches.
The supreme court reversed because the videotape statute was
unconstitutionally overbroad. Writing for the court, Justice Bradley
observed that "Stevenson's conduct of surreptitiously videotaping his
former girlfriend in the nude is abhorrent and that such conduct is
given no protection under the First
Amendment." Yet overbreadth analysis focuses on the statute, not the
defendant's conduct. The state conceded that the statute was overbroad
on its face because it "improperly prohibits all visual expression of
nudity without explicit consent, including political satire and
newsworthy images" (¶ 21). It even includes reproductions of famous
artworks. The court was unable to construe the statute in such a way as
to save its constitutionality. To save it meant adding two elements that
would significantly alter the Legislature's original creation - a
"rewrite."
Justice Wilcox, joined by Justice Crooks, dissented on the ground
that a limiting construction was feasible.
Criminal Procedure
Six-Person Juries in Misdemeanor Cases - Unconstitutional Statute -
Waiver of Objection
State v. Huebner, 2000 WI 59
(filed 20 June 2000)
Wis. Stat. section 756.096(3)(am) (1995-96) provided that a jury in
misdemeanor cases shall consist of six persons. In State v. Hansford, 219 Wis. 2d 226,
580 N.W.2d 171 (1998), the supreme court held this statute
unconstitutional as violating the jury trial guarantee of article I,
section 7 of the Wisconsin Constitution. [Note: This statute has been
repealed and reenacted in substantially the same language at Wis. Stat.
section 756.06(2)(am) (1997-98).]
At the time of the defendant's trial, the Hansford appeal
was pending before the supreme court. Nevertheless, the defendant did
not object to the use of a six-person jury in his misdemeanor trial, and
he was subsequently convicted.
The issue before the supreme court in this case was whether a
defendant who did not object to the use of a six-person jury at his
misdemeanor trial, as authorized by the statute cited above, may obtain
a new trial in reliance on the decision in Hansford holding
section 756.096(3)(am) unconstitutional. Writing for three justices of
the court, Justice Wilcox concluded that the defendant is not entitled
to a new trial. It is a fundamental principle of appellate review that
issues must be preserved at the circuit court. Issues not preserved at
that level, even alleged constitutional errors, generally will not be
considered on appeal. The defendant forfeited his right to a 12-person
jury when he failed to object to the use of a six-person jury at his
misdemeanor trial.
The court also declined to exercise its discretionary power to
reverse the defendant's conviction. The defendant did not establish that
a miscarriage of justice occurred in his case or that the real
controversy was not tried. [Note: An earlier claim by the defendant that
he had received ineffective assistance of counsel was abandoned and, on
appeal, he asserted that trial counsel's assistance was neither
incompetent nor deficient.]
Justice Prosser filed a concurring opinion in which he joined in the
judgment to affirm the defendant's conviction but wrote separately to
argue that the statute authorizing six-person juries in misdemeanor
cases is constitutional and that the Hansford decision should
be overruled.
Chief Justice Abrahamson filed a dissenting opinion that was joined
by Justices Bradley and Sykes.
Search and Seizure - Warrantless Entry of Home - Hot Pursuit -
Exigent Circumstances - Attenuation Analysis
State v. Richter, 2000 WI 58
(filed 20 June 2000)
A sheriff's deputy responded to an early-morning dispatch of a
burglary in progress at a trailer park. The victim flagged down the
deputy as he arrived on the scene and told him that someone had broken
into her mobile home, and that she had seen the intruder flee her
trailer and enter another trailer across the street. At that second
trailer the deputy observed signs of forced entry - a window screen was
knocked out and lying on the ground. The deputy shined his flashlight
into the open window and attracted the attention of two people who were
sleeping on the floor. They opened the door and identified a third
person, who was sleeping on the couch, as the owner of the trailer. The
deputy entered the trailer, woke the owner, told him what had happened,
and asked his permission to search the trailer for the burglary suspect.
Permission was granted and, during the search, the deputy observed
marijuana in plain view, which the owner admitted was his.
The owner of the second trailer was charged with several drug
offenses and he moved to suppress the physical evidence and his
statements, claiming they were the product of an illegal entry of his
trailer. The circuit court granted the motion and the court of appeals
affirmed.
In a majority opinion authored by Justice Sykes, the supreme court
reversed. It concluded that the entry was justified by exigent
circumstances - specifically, the deputy's "hot pursuit" of the burglary
suspect and his need to protect the safety of those inside the
trailer.
The exigent circumstance of "hot pursuit" is established where there
is an immediate and continuous pursuit of a suspect from the scene of a
crime. The warrantless entry of the defendant's trailer was justified by
this exigent circumstance. The supreme court rejected the implication in
the court of appeals' decision in this case that hot pursuit as a
justification for a warrantless home entry requires that the officer
himself personally observe the crime or the fleeing suspect. The supreme
court did not believe there is such a prerequisite. The exigency of an
officer's pursuit of a suspect may be just as great when the officer is
told of the crime and the whereabouts of a suspect by an eyewitness just
after its commission as when he observes it himself. To allow a
warrantless entry when an officer personally observes a crime and
pursues the suspect, but disallow it when he immediately responds to an
eyewitness report and pursues the suspect would, said the court, be
arbitrary.
The court also concluded that the warrantless entry was justified by
the exigency of a threat to the safety of the suspect or others. The
deputy reasonably believed that the intruder he was pursuing posed a
threat to the safety of the occupants of the second trailer. It was the
middle of the night. A stranger had just broken into the first trailer,
but was discovered and therefore abandoned whatever crime he intended to
commit in the first trailer, fleeing into the trailer across the street.
There were obvious signs of forced entry there and it was reasonable to
infer that the suspect did not belong in the second trailer. There were
people sleeping inside that trailer at the time the intruder entered,
creating a situation fraught with potential for physical harm if
something was not done immediately to apprehend the suspect. [In
hindsight, there apparently was no threat to those inside the second
trailer, because the "intruder," in fact, was a resident there. But
hindsight does not apply to the exigency analysis; a court only
considers the circumstances known to the officer at the time entry was
made.]
Accordingly, the court concluded that the warrantless entry of the
defendant's trailer was justified based on the exigent circumstances of
hot pursuit and threat to safety and was therefore reasonable under the
Fourth
Amendment.
The court also concluded that, even if the entry had been contrary to
the Fourth Amendment, the defendant's consent to enter was sufficiently
attenuated from the entry to purge any taint of illegality.
Chief Justice Abrahamson filed a dissenting opinion that was joined
by Justice Bradley.
Debtor-creditor Law
Judgment Liens - Homestead Exemption
Rumage v. Gullberg, 2000 WI
53 (filed 16 June 2000)
Under Wisconsin law, a debtor can shelter up to $40,000 of homestead
equity from the lien of a judgment creditor. When the debtor's homestead
equity is at or below the statutory maximum, it is "fully exempt." The
issue before the supreme court in this case was whether a properly
docketed judgment constitutes a valid lien against fully exempt
homestead property at the time the property is sold.
The judgment-creditor argued that a docketed judgment is a lien on
homestead property owned by a judgment debtor; it is only the value of
the homestead up to the statutory maximum of $40,000 that is exempt from
a creditor's claim. He maintained that a judgment lien can be removed
from the homestead's chain of title only through some judicial process
such as a levy of execution or a declaratory judgment. A private sale
cannot extinguish a judgment lien and the docketed judgment remains a
lien on the property.
The defendants contended that if the debtor's equity in the homestead
property at the time of sale is at or below the $40,000 exempted by
statute, then the homestead is fully exempt and the judgment lien does
not attach. As a result, a fully exempt homestead can be transferred in
a private sale unencumbered by the judgment lien.
In a unanimous decision authored by Justice Bablitch, the supreme
court concluded that a judgment lien is not a valid lien against fully
exempt homestead property. If the debtor has less than $40,000 in
equity, then the homestead is fully exempt. The debtor possesses no
equity interest upon which the judgment can be a lien. As a result,
there is no lien, and accordingly, a debtor-seller can give clear title
to the purchaser of fully exempt homestead property.
If the debtor's equity in the homestead exceeds the amount sheltered
by statute, there is surplus equity and the homestead is "partially
exempt." The supreme court concluded that when a homestead is partially
exempt, a docketed judgment is a lien upon the debtor's equity in excess
of the amount sheltered by the statute. When the partially exempt
property is sold, this defect must be corrected in order for the seller
to give clear title.
Employment Law
Family Leave - Paid Sick Time - ERISA - Preemption
Aurora Medical Group v. Dept. of
Workforce Development, 2000 WI 70 (filed 27 June 2000)
A nurse requested family leave to adopt a child. Her employer granted
the leave but denied her additional request to substitute paid sick time
for unpaid family leave on the ground that she was not ill. She was
permitted to apply vacation and holiday/personal time toward the leave.
The nurse filed a complaint with the Department of Workforce Development
(DWD). An administrative law judge (ALJ) ordered the employer to credit
the nurse with about 30 hours in vacation time that she used instead of
her paid sick time. The circuit court affirmed the ALJ. The court of
appeals also affirmed.
The supreme court, in a decision written by Justice Crooks, affirmed
the court of appeals. The court held that the employer failed to show
that section 514(a) of ERISA preempts Wisconsin's Family and Medical
Leave Act's (FMLA) "substitution provision." More precisely, the
employer "failed to carry its burden of overcoming the presumption
against preemption." First, the employer "failed to establish that the
substitution provision 'relates to' employment benefit plans under
section 514(a) of ERISA." Second, it also failed to "show a clear and
manifest purpose by the Congress to pre-empt the Wisconsin FMLA
substitution provision." To the contrary, it appears that Congress
intended to protect more generous state-granted family leave rights.
Third, the employer failed "to show how ERISA preemption of
state-provided family leave rights would not result in impairment of the
federal FMLA in contravention of section 514(d) of ERISA." (¶
37)
Family Law
Divorce - Property Division - Power of Courts to Construe Their
Judgments
Washington v. Washington,
2000 WI 47 (filed 7 June 2000)
The husband in this divorce action is a federal employee who
anticipated retirement approximately 21 years from the date of the
divorce judgment. His federal pension plan was valued at $50,000 at the
time of divorce. Desiring to maintain an equal property division of all
property, the circuit court awarded the wife $24,000 of the pension and
awarded the husband $26,000. The judgment made no mention of interest or
appreciation on either party's lump-sum share of the pension or when or
how payment of the federal pension was to be made. The wife will not get
her share under the divorce judgment until payments are made to her
ex-husband when he retires.
The parties disagree as to the correct construction of the circuit
court's division of the federal pension. The husband maintains that at
the time of his retirement his ex-wife would receive her specified
lump-sum share of the pension and that he alone would receive any and
all appreciation and interest that accumulated on both spouses' shares.
The wife argues that she should receive appreciation and interest on her
lump-sum share of the pension and that her ex-husband should receive
appreciation and interest on his lump-sum share of the pension.
The wife filed a motion asking the circuit court to amend the divorce
judgment to award her appreciation and interest on her lump-sum share of
the pension. The circuit court denied the motion, believing that Wis.
Stat. section
767.32(1)(a) prohibits modifying or revising the provisions of a
judgment of divorce with respect to the final division of property. The
court of appeals affirmed. In a unanimous decision authored by Chief
Justice Abrahamson, the supreme court reversed the court of appeals.
The issue before the supreme court was whether a circuit court may
construe its judgment and allocate appreciation and interest on a
lump-sum share of a pension awarded to a spouse (but not payable
immediately) when the final division of property in the divorce judgment
is silent about any such allocation. The supreme court concluded that a
circuit judge may construe the final division of property in a divorce
judgment and allocate appreciation and interest on a pension when the
divorce judgment is silent about the allocation of appreciation and
interest on a lump-sum share awarded to a spouse but not payable
immediately. The silence about appreciation and interest makes the
judgment ambiguous. A circuit court's construction of the ambiguous
final division of the pension under these circumstances does not violate
the statute cited above. Although a circuit court may not revise or
modify the final division of property, it has the power to effectuate
its orders and do justice. A divorce judgment that is clear on its face
is not open to construction. However, if it is ambiguous, construction
is allowed.
The judgment described above was held to be ambiguous about the
allocation of appreciation and interest on the pension between the date
of the divorce and the distribution of the pension. Accordingly, the
supreme court concluded that the circuit judge should determine the
allocation on remand.
Insurance
Exclusions - Loading Operations
Mullenberg v. Kilgust Mechanical
Inc., 2000 WI 66 (filed 23 June 2000)
Mullenberg drove truck for a common carrier that carried liability
insurance issued by Great West. Mullenberg stopped at Kilgust Mechanical
to deliver a load of pipe in 1996 and was injured when a Kilgust
employee caused the pipes to roll off the truck onto Mullenberg.
Mullenberg sued Kilgust and its insurer in federal court, which in turn
impleaded Great West as the primary insurer. Great West argued that a
policy exclusion foreclosed coverage.
The Seventh Circuit certified this case to the supreme court to
resolve the following issue of state law:
"Whether Wis. Stat. section
194.41 because of its use of the term 'negligent operation' requires
insurers to cover the loading activities of third-parties and, if not,
whether Wis. Stat. section
194.41 incorporates the Omnibus Statute, Wis. Stat. section
632.32, so that an insurer who issues and delivers a policy outside
of Wisconsin must comply with the requirements of the Omnibus
Statute."
The supreme court, in a decision written by Justice Bablitch,
concluded that "the word 'operation' in Wis. Stat. section
194.41(1) includes loading and unloading and an individual
permissively unloading the vehicle is covered by the motor carrier's
policy." For this reason, the insurer's exclusion of such coverage was
invalid.
Labor Law
Wage Claims for On-duty Meal Periods - Suits Brought Under State
Wage Claim Law
German v. Wisconsin Department of
Transportation, 2000 WI 62 (filed 21 June 2000)
Officers of the Wisconsin State Patrol filed suit against the
Department of Transportation (DOT), asserting that they were neither
relieved from duty during their 30-minute lunch breaks, nor compensated
for this on-duty time as required by Wis. Admin. Code section DWD
274.02(3). As a result, the officers alleged that they were entitled
to compensation for these hours worked. Their suit to compel payment of
wages due was filed pursuant to Wisconsin's wage claim law. See
Wis. Stat. §§
109.01 and 109.03.
The DOT moved to dismiss the suit. The circuit court denied the
motion and the court of appeals affirmed the order of the circuit court.
In a majority opinion, which was authored by Justice Bablitch, the
supreme court affirmed the court of appeals.
The first issue before the court was whether the officers could bring
a claim under section
109.03(5) seeking wages for on-duty meal periods, or whether the
officers' exclusive remedy is to be found in the administrative
procedures codified in section
103.005. [Wis. Stat. chapter
103 is the Hours of Work Law]. The supreme court held that section
103.005 is not the exclusive means to enforce a wage claim grounded
upon the administrative code section cited above and that the right of
action created by section
109.03(5) allows for claims based upon the hours and overtime
regulations to be brought in circuit court without first obtaining
administrative review by the Department of Workforce Development.
Secondly, the court held that the Legislature has waived the state's
immunity in chapter
109 for the type of claim brought by the officers in this case.
Chief Justice Abrahamson filed a concurring opinion that was joined
by Justice Sykes.
Municipal Law
Wis. Stat. Chapter 68 Certiorari Proceedings - 42 U.S.C. section
1983 Actions for Money Damages
Hanlon v. Town of Milton,
2000 WI 61 (filed 21 June 2000)
The plaintiff sought a conditional use permit from the Town of Milton
to operate a gravel quarry on his agricultural property. The application
was denied and the plaintiff sought certiorari review pursuant to Wis.
Stat. chapter
68. The circuit court reversed, but that decision was subsequently
overturned by the state court of appeals.
Thereafter, the plaintiff brought an action in federal district court
under 42
U.S.C. section 1983, alleging that the defendants deprived him of
his constitutional rights to due process and equal protection of the law
by denying his conditional use permit application. The suit sought money
damages. The town moved for summary judgment, which was granted. The
plaintiff appealed to the U.S. Court of Appeals for the Seventh
Circuit.
The federal appellate court certified a question of law to the
Wisconsin Supreme Court. In sum, the supreme court was asked to address
a narrow question of law: When a municipal administrative determination
gives rise to an equal protection claim for money damages actionable
under section
1983, must this equal protection claim be brought and heard in a
Wis. Stat. section
68.13 certiorari proceeding brought by the litigant?
In a unanimous decision authored by Justice Bablitch, the supreme
court concluded that a litigant cannot bring a claim for money damages
grounded upon 42 U.S.C. section
1983 in a certiorari proceeding brought under Wis. Stat. chapter
68. The court further concluded that although the plaintiff could
have joined his section 1983
claim with his chapter
68 certiorari review, he was not required to do so. Failure to join
these actions does not preclude him from now bringing his section 1983
claim.
County Sheriffs - Disciplinary Procedures - Arbitration Clause in
Collective Bargaining Agreements
Eau Claire County v. General
Teamsters Union Local No. 662, 2000 WI 57 (filed 20 June
2000)
The circuit court enjoined the Wisconsin Employment Relations
Commission from acting on a prohibited practice complaint filed by the
union. The union's complaint alleged that Eau Claire County refused to
arbitrate the dismissal of a deputy sheriff pursuant to the collective
bargaining agreement between the county and the union. The circuit court
dismissed the complaint, holding that Wis. Stat. section
59.52(8)(c) establishes the circuit court as the exclusive forum in
which an aggrieved county law enforcement employee may challenge an
order of a civil service commission to dismiss, demote, suspend, or
suspend and demote the employee. The court of appeals reversed the
circuit court and the supreme court, in a majority decision authored by
Chief Justice Abrahamson, affirmed the court of appeals.
The issue before the supreme court was whether a county law
enforcement employee's appeal to circuit court pursuant to the statute
cited above is the employee's exclusive appeal procedure in the
disciplinary context. Or may the county law enforcement employee use the
grievance procedures, including arbitration, provided in the applicable
collective bargaining agreement in lieu of an appeal to the circuit
court?
The majority concluded that the circuit court is not the exclusive
forum in which a county law enforcement employee may challenge an order
of the civil service commission to dismiss, demote, suspend, or suspend
and demote the employee. The court held that after a civil service
commission issues such an order, the employee may either appeal to the
circuit court pursuant to the statute cited above or pursue grievance
procedures, including arbitration, as provided for in any applicable
collective bargaining agreement. The employee may not, however, pursue
both remedies.
At numerous points in the decision, the court distinguished City
of Janesville v. WERC, 193 Wis. 2d. 492, 535 N.W.2d 34 (Ct. App.
1995), wherein the court of appeals held that when an irreconcilable
difference exists between a statutory procedure and the arbitration
provisions of a collective bargaining agreement, the statute controls.
City of Janesville dealt with municipal public safety
employees, whereas this case involves county law enforcement
personnel.
Justice Sykes filed a dissenting opinion that was joined by Justice
Prosser.
Torts
Child Sexual Abuse - Negligence - Failure to Warn
Gritzner v. Michael R., 2000
WI 68 (filed 23 June 2000)
A 10-year-old boy, Michael, sexually assaulted a 4-year-old girl,
Tara. The assault occurred at Michael's home, where he lived with his
mother and his mother's boyfriend, Bubner. Tara's parents sued Bubner
(and others), alleging that Bubner had: 1) negligently failed to warn
them of Michael's propensity to engage in inappropriate sexual behavior;
and 2) negligently failed to control Michael's conduct. The circuit
court dismissed both claims. The court of appeals reinstated the claim
for negligent failure to control but reluctantly affirmed the dismissal
of the failure to warn claim. Both parties appealed.
The supreme court affirmed in part and reversed in part. Justice
Wilcox wrote the lead opinion. All members of the court agreed that the
case should be remanded. Those joining the lead opinion would affirm the
court of appeals on both claims. More particularly, the lead opinion
concludes that public policy considerations preclude the claim for
negligent failure to warn. The justices joining the lead opinion were
particularly concerned that "in this case there are no just and sensible
guidelines for defining liability for negligent failure to warn" (¶
36). The lead opinion did, however, recognize the claim for negligent
failure to control "only because liability for failure to control can be
imposed on distinct, narrow grounds that do not raise the same public
policy considerations that preclude liability for failure to warn." Such
claims may be predicated on the doctrine of in loco parentis or on the
theory that the adult (Bubner) voluntarily undertook Tara's
protection.
Chief Justice Abrahamson concurred in an opinion that agreed with the
lead opinion's "failure to control" analysis. The concurrence asserted,
however, that the public policy factors should be applied first by the
circuit court based on a complete evidentiary record. The concurrence
was joined by Justices Bablitch, Bradley, Crooks, and Sykes. This
means that the lead opinion is the court's opinion on the negligent
failure to control, but that the concurrence is the opinion of the court
on the negligent failure to warn.
Collateral Source Rule - Medical Assistance Payments
Ellsworth v. Schelbrock,
2000 WI 63 (filed 22 June 2000)
The defendant struck a car driven by the plaintiff, who was severely
injured. The trial court found that the plaintiff had received past
medical services valued at nearly $600,000. The state-sponsored Medical
Assistance program (Title 19), which provides health insurance to
certain needy individuals, had paid about $355,000 for past medical
expenses. (By law, the health-care providers had to accept the payment
schedules set by Title 19.) The trial court rejected the defendant's
argument that she was limited to the actual amount of the payments. The
court of appeals affirmed.
The supreme court, in a decision written by Justice Bablitch,
affirmed as well. The collateral source rule provides that "the amount
of damages awarded to a person injured because of another individual's
tortious conduct is not reduced when the injured party receives
compensation from another source, such as insurance or sick leave." The
court held that the rule applies to Medical Assistance payments. The
collateral source rule imposes "upon the tortfeasor full responsibility
for the loss he has caused." The defendant was not entitled "to reap the
benefit of [the plaintiff's] eligibility for public assistance or from
the government's economic clout in the health care market place" (¶
17). The court also rebuffed several other arguments rooted in the
county's right to subrogation and several public welfare statutes.
Justice Sykes dissented, joined by Justices Wilcox and Crooks.
Settlements - Covenants not to Sue - Admissibility
Morden v. Continental AG,
2000 WI 51 (filed 16 June 2000)
The plaintiffs sustained serious injuries when their car rolled over
following a tire blowout. They sued the car's manufacturer (VW), the
dealer, and the tire manufacturer, Continental AG. Prior to trial, the
plaintiffs settled with VW. A jury returned verdicts for the plaintiff
on claims alleging both negligence and strict product liability. The
trial judge approved the verdict as to the negligence finding, but the
jury's defective answers to the strict liability questions precluded
entry of judgment on that claim. The court of appeals reversed on the
ground that there was insufficient evidence of Continental AG's
negligence.
The supreme court, in a decision written by Justice Prosser, reversed
the court of appeals. The case presented four issues on appeal, but the
supreme court needed to address only two. First, the court held that the
evidence was sufficient to sustain the judgment against Continental AG.
Since this discussion is extremely fact-intensive and involves
application of long-settled legal principles, it will not be addressed
further.
The second issue alleged that error occurred when the trial judge
excluded evidence about a settlement between the plaintiffs and VW, the
car's manufacturer, about two weeks before trial. In exchange for
$500,000, the plaintiffs executed a covenant not to sue VW, which the
trial judge excluded. Section 904.08 generally excludes evidence of
compromise or settlement except where it is relevant to show bias,
particularly where it appears that a witness may have changed his or her
testimony. In this case, the trial judge did not abuse his discretion by
excluding the covenant not to sue. The judge found that an expert
witness had not "changed" his testimony; rather, he had not been asked
about certain facets of the crash. And the omissions did not amount to a
"change" in testimony. In sum, Continental AG was not entitled to a new
trial based on the exclusion of this evidence.
Contributory Negligence - Mental Illness
Jankee v. Clark County, 2000
WI 64 (filed 22 June 2000)
While hospitalized at a county mental health complex, Jankee severely
injured himself while attempting to escape out of a window. Jankee sued
the county and various contractors. The circuit court granted summary
judgment to the contractors based on the government contractor immunity
doctrine. The judge dismissed the claims against the county on the
ground that Jankee's contributory negligence exceeded that of the county
(if any). The court of appeals affirmed as to the contractors but
reversed as to the county. The court held that Jankee's conduct should
be assessed under a subjective standard of care because of his mental
illness and the circumstances of his commitment.
The supreme court, in a decision written by Justice Prosser, reversed
as to the claim against the county. (The court did not reach the
plaintiff's argument that the defendant contractors could not claim
immunity as government contractors.) The supreme court held that
Jankee's own negligence exceeded any attributed to the defendants,
including the county, as a matter of law. The majority opinion
extensively discusses the standard of care applicable to mentally ill
plaintiffs. It ruled that Jankee's conduct must be assessed under a
reasonable person standard of care, not a subjective test, except in two
relatively narrow instances addressed by prior cases and not implicated
in this case. See ¶ 78.
The court stressed two points. First, Jankee's hospitalization arose
because he failed to comply with his medication program, something a
reasonable person would not have done. Second, Jankee's injury occurred
during an escape attempt which, under the circumstances, also failed the
reasonable person standard ("Jankee was a major cause of his own
injuries." ¶ 89). In short, Jankee's conduct failed the reasonable
person standard and did not fit within the two narrow exceptions set
forth by the cases.
Chief Justice Abrahamson, joined by Justice Bradley, dissented on a
variety of grounds, including the ripeness of the case for summary
judgment and the policy determination that the institutionalized
mentally ill should be held to a reasonable person standard.
Zoning
Equal Protection - Substantive Due Process - Procedural Due
Process
Thorp v. Town of Lebanon,
2000 WI 60 (filed 21 June 2000)
The plaintiffs own approximately 255 acres in the Town of Lebanon,
which is located in Dodge County. The property is a mix of open land,
woods, and wetlands. Before 1994, the land was zoned with a
classification of rural development. In that year, the Town of Lebanon
Board of Supervisors approved a rezoning map that extensively revised
the zoning classification of most of the town from a rural development
classification to a general agricultural classification. The Dodge
County Board of Supervisors thereafter amended its official zoning map
to incorporate the town's zoning reclassifications.
The plaintiffs subsequently petitioned the town to rezone their
property to its original classification. The town acquiesced, but the
Dodge County Board of Supervisors declined to further amend the county
zoning map, and thus the plaintiffs' entire property remained zoned in
an agricultural classification.
The plaintiffs filed suit against the town and the county seeking
declaratory, injunctive, and monetary relief. They claimed that the town
and county zoning ordinances were invalid and violated their due process
and equal protection rights.
In a majority decision authored by Justice Crooks, the supreme court
first considered whether the plaintiffs complied with the notice of
claims statute. The court concluded that, as to their federal
constitutional claims, the plaintiffs did not have to comply with the
Wisconsin notice statute. See Felder v. Casey, 487 U.S. 131
(1988). Further, upon review of the record, the court concluded that the
plaintiffs did in fact comply with the notice statute.
Next, the court concluded that the plaintiffs' complaint stated a
valid claim for relief under the Equal Protection Clause. The complaint
had to allege facts showing that the rezoning ordinance was not
rationally related to its purpose. This was satisfied by allegations
that the highest and best-suited use of the plaintiffs' property is not
agricultural but rather rural development, and that the new zoning map
left numerous "islands" throughout the town that have not been rezoned
and have been left with a rural development classification without any
logical explanation. The county argued that the plaintiffs are barred
from making an equal protection claim because they did not avail
themselves of an adequate state law remedy, namely certiorari review
under Wis. Stat. section 68.13. The court rejected this argument because
the plaintiffs could not have received adequate relief by certiorari
review of their equal protection violation claim. Monetary damages are
not available to a plaintiff seeking relief under section
68.13. While a plaintiff may join a claim for monetary damages with
a chapter
68 certiorari review, he or she is not required to do so.
The court next considered the plaintiffs' due process claims. It held
that they did not state a claim for a violation of substantive due
process. The Substantive Due Process Clause protects individuals against
governmental actions that are arbitrary and wrong, regardless of the
fairness of the procedures used to implement them. It forbids a
government from exercising power without any reasonable justification in
the service of a legitimate governmental objective. The court concluded
that the plaintiffs' complaint did not make any allegations that the
zoning ordinance was clearly arbitrary and unreasonable.
With regard to the procedural due process claim, the court concluded
that the state provides the plaintiffs with an adequate post-deprivation
remedy in the form of certiorari. The adequate state remedy available to
the plaintiffs was to petition for certiorari review under section
68.13. Because the plaintiffs did not use the available state law
remedy, they may not now claim that they were denied procedural due
process.
Lastly, the court considered whether the Town of Lebanon was properly
dismissed from the lawsuit below. The court of appeals found that the
town could not be dismissed as to the equal protection claim because
that claim related to the invalidity of the zoning ordinance itself. The
supreme court agreed with the court of appeals.
Chief Justice Abrahamson filed a concurring opinion in which she
joined the majority opinion except for the discussion about substantive
due process. Justices Bradley and Sykes joined the concurrence.
Regulation of Game Bird Farms - DNR Authority - Municipal Immunity -
Equitable Estoppel
Willow Creek Ranch v. Town of
Shelby, 2000 WI 56 (filed 20 June 2000)
Willow Creek owns 115 acres of land in the Town of Shelby. The
property is zoned as "exclusive agricultural." In 1993, Willow Creek
contacted the town to inquire whether a zoning change would be required
in order to operate a game bird farm on its property. The town
chairperson allegedly informed Willow Creek that no county rezoning was
needed to make the change. Shortly before opening the farm in late 1994,
and after already having expended substantial sums of money, Willow
Creek obtained a Department of Natural Resources (DNR) license to
operate a game bird farm.
The county thereafter notified Willow Creek that because it was
conducting a commercial hunting enterprise on property zoned exclusively
for agricultural purposes, it needed to petition for rezoning. Although
the county ultimately granted the rezoning petition, it was vetoed by
the Town of Shelby. Willow Creek filed multiple lawsuits in the wake of
the town's actions, seeking declaratory judgment, injunctive relief, and
money damages. These lawsuits were dismissed by the circuit court on
summary judgment. The court of appeals affirmed.
In a majority decision authored by Justice Bradley, the supreme court
affirmed the court of appeals. The first issue considered by the court
was whether DNR's exclusive right to license the operation of game bird
farms precludes the town and county from regulating the zoning of such
farms. The court concluded that DNR's statutory authority does not
preclude the authority of the town and county to regulate the zoning of
the game bird farm.
The court also concluded that the actions of the town and county were
immune from suit under Wis. Stat. section
893.80(4). Willow Creek argued that the denial of rezoning was a
ministerial duty for which there is no municipal immunity. The supreme
court disagreed. It concluded that decisions to enforce a zoning
ordinance and to veto zoning changes represent legislative acts and are
therefore discretionary decisions subject to immunity protection. The
immunity bars Willow Creek's suit for money damages as well as its suit
for injunctive relief. There is no immunity under the statute cited
above for declaratory actions; however, because the actions of the town
and the county were neither illegal nor unconstitutional, declaratory
relief is unavailable.
Finally, the court considered whether the town and county should be
equitably estopped from asserting immunity as a defense due to the
allegedly negligent misrepresentations of the town chairperson. The
court concluded that although municipalities are not wholly immune from
the doctrine of equitable estoppel, it is well established that
erroneous acts or misrepresentations of municipal officers do not afford
a basis to estop a municipality from enforcing zoning ordinances enacted
pursuant to the police power.
Justice Prosser filed a dissenting opinion that was joined by
Justices Bablitch and Crooks.
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.
Wisconsin Lawyer