Court of Appeals Digest

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

| Appellate Procedure | Construction Law | Contribution | Criminal Procedure | Torts |

Appellate procedure

Sex Predator Law Commitments -Time to Initiate Appeal

State v. Brunette, No. 96-2351 (filed 12 June 1997) (ordered published 29 July 1997)

The circuit court committed the defendant to the custody of the Department of Health and Social Services because it determined that he was a sexually violent person under the provisions of Chapter 980 of the Wisconsin Statutes, the sex predator law. 118 days later he filed a notice of appeal from the commitment order. The issue before the court of appeals was whether the defendant initiated his appeal in a timely fashion.

The defendant contended that he had 120 days to file a notice of appeal under the provisions of section 808.04(5) of the Wisconsin Statutes. However, the court of appeals concluded that this statute does not apply to those who are committed under chapter 180. Section 808.04(5) provides that "a person imprisoned or in the intensive sanctions program on a criminal sentence against whom a civil final judgment or order is rendered has 120 days in which to appeal the civil judgment or order." The defendant in this case was not imprisoned under a criminal commitment but instead under a chapter 980 civil commitment. Consequently, his time limits for initiating an appeal of the chapter 980 commitment order is governed by the 45/90 day rule for civil appeals. See Wis. Stat. 808.04(1). Because his notice of appeal was filed 118 days after entry of the civil commitment order, it was untimely. A failure to timely file a notice of appeal from a final judgment or order in a civil case deprives the court of appeals of jurisdiction. Accordingly, the court was compelled to dismiss this appeal.

Construction law

Discovery Rule - Builder's Negligence - Contract Claims

Williams v. Kaerek Builders Inc., No. 96-2396 (filed 18 June 1997) (ordered published 29 July 1997)

The plaintiffs sued their builder because their basement leaked. They moved into their home in December 1987. When they immediately observed leaks and seepage, they contacted the builder who made various representations ("all new homes" leak) and attempted patchwork solutions. In 1994 the owners hired a waterproofing company which discovered that the basement drain tiles had been improperly installed. The plaintiffs filed their claim in 1995, alleging negligence and breach of contract. The trial court granted summary judgment to the builder.

The court of appeals, in an opinion written by Judge Brown, reversed in part and affirmed in part. Applying the discovery rule to the negligence claim, the court held that in cases "involving faulty workmanship, a builder's representation can result in a justifiable delay of discovering the cause." The reasonableness of the plaintiffs' reliance presented a question of fact for the jury. The claim sounding in contract was not, however, subject to the discovery rule. And despite its conclusions on the negligence issue, the court of appeals declined to apply equitable estoppel to the contract claim because the trial judge had not abused his discretion in rejecting that argument.

Contribution

Cognizable Contribution Claims - Ripeness

Diamond v. Ruszkiewicz, No. 96-1798 (filed 18 June 1997) (ordered published 29 July 1997)

The parties to this appeal signed a business note in the amount of $40,000. The maker of the note was plaintiff Historic Dining Inc. Plaintiffs Diamond and Hudick are officers of this corporation. When the note was made, Diamond and Hudick signed both in their capacity as officers of Historic Dining and as individuals. Barbara Ruszkiewicz also signed the note in an individual capacity.

Historic Dining defaulted on the note and the bank called it due for the sum of $40,000 plus interest. Another corporation, Historic Renovations Inc., of which Diamond and Hudick are officers, paid the interest due on the note and shortly thereafter Historic Renovations signed a new note with the bank for $40,000, which paid the original note.

The bank then consolidated the debt for Historic Renovations when it made a new loan to that corporation for $280,000. That loan was secured by real property and was backed by Diamond's and Hudick's personal guarantees. Barbara was not asked to sign as a guarantor on that note.

Diamond, Hudick and Historic Dining subsequently filed an action against Barbara (and also against her husband under a marital property theory) for contribution, seeking one-third of the original $40,000 loan amount. At the close of the plaintiff's case, the circuit court granted the defendants' motion to dismiss, finding that Diamond and Hudick had failed to prove their contribution claim. The trial court found that no evidence had been presented that showed they had paid any part of the debt to the bank from their individual funds, nor had Historic Dining paid the debt.

The issue presented was whether the appellants have a cognizable claim for contribution from the defendants. The court of appeals, in a decision authored by Judge Snyder, concluded that, because a contribution claim requires that the party claiming the right has paid the debt of another and that requirement was not satisfied in this case, the decision of the trial court should be affirmed.

The law of contribution is well settled. It is based upon the belief that those who insure or become a surety with another ought to share the results of a default. A guarantor's claim for contribution must rest on the ground that he or she has paid more than his or her equitable share as against the coguarantors in order to discharge a common liability. However, there is a clear distinction between payment and purchase. Payment extinguishes and discharges indebtedness, whereas purchase merely transfers the indebtedness. If a debt is not discharged, no claim for contribution can arise.

In this case a corporation (Historic Renovations Inc.) paid the interest that was due on the Historic Dining note and eventually signed a new note with the bank to pay Historic Dining's note. Diamond, Hudick and Barbara all were individually liable on the note made by Historic Dining. Only Diamond and Hudick were coguarantors of the second note. However, at no time did the appellants personally pay any portion of the Historic Dining note. While another corporation has assumed the obligations of the Historic Dining note, that assumption might not relieve the liability that all three personal guarantors still carry with regard to the original note. There may yet be a point in time where the three coguarantors will be required to pay on the original note; however, at this time the appellants' contribution claim is premature. Until one of them actually pays a disproportionate share under the original note, any claim seeking contribution is not yet ripe.

Criminal procedure

Sex Offender Treatment Programs - Revocation of Probation - Failure to Acknowledge Responsibility for Crime

State ex rel. Warren v. Schwarz, No. 96-2441 (filed 15 May 1997) (ordered published 24 June 1997)

The defendant was convicted of first-degree sexual assault of a child following the entry of an Alford no-contest plea. An Alford plea is one in which the defendant pleads guilty or no contest, while either maintaining his innocence or not admitting having committed the crime. Prior to accepting the plea, the court advised the defendant that, in the event the court granted probation to him, counseling likely would be a condition and that he would have an obligation to enter into counseling in good faith.

The trial court imposed a five-year sentence that it stayed in favor of an eight-year term of probation. One of the conditions of probation ordered by the court was that the defendant cooperate with any counseling required by the Department of Corrections and complete any counseling as ordered.

The department proceeded to revoke the defendant's probation claiming that the defendant had violated a condition of that probation by failing to successfully complete a sex offender treatment program in that he failed to acknowledge responsibility for the sexual assault for which he was convicted. Following revocation of probation the defendant filed a petition for writ of certiorari to review the revocation order. The circuit court affirmed the decision to revoke and the court of appeals, in a decision authored by Judge Vergeront, affirmed the circuit court.

The defendant's principal contention on appeal was that it was a violation of his right to due process to revoke his probation because of his denial of guilt for a sexual assault when the conviction for that assault was based upon an Alford no-contest plea. The premise of the defendant's due process argument was that the acceptance of an Alford plea implies an assurance that the defendant will not have to admit his guilt either during conviction or punishment. Rejecting this premise as faulty, the court concluded that an Alford plea does not imply a promise or assurance of anything. More accurately stated, an Alford plea, if accepted by the court, permits a conviction without requiring an admission of guilt and while permitting a protestation of innocence. There is nothing inherent in the nature of an Alford plea that gives a defendant any rights, or promises any limitations, with respect to the punishment imposed after revocation of probation.

Accordingly, the court of appeals concluded that the defendant's right to due process was not violated by requiring that he admit responsibility for the sexual assault in the context of a treatment program required as a condition of probation.

Conditions of Probation - Right to Privacy

Krebs v. Schwartz, No. 96-2596 (filed 11 June 1997) (ordered published 29 July 1997)

The petitioner sought review of a decision revoking his probation. He argued that the condition of probation requiring him to discuss and receive approval from his probation agent before he engaged in an intimate relationship with an adult female was an unconstitutional infringement on his right to privacy.

The petitioner was convicted of first-degree sexual assault of his daughter. He received a prison term that was stayed and instead he was placed on probation with a variety of conditions. Among those conditions was the one requiring prior approval for engaging in intimate relationships.

The circuit court denied the petitioner's challenge to the revocation brought through a petition for writ of certiorari. The court of appeals, in a decision by Judge Anderson, affirmed.

Said the court of appeals, conditions of probation may impinge upon constitutional rights as long as they are not overly broad and are reasonably related to the person's rehabilitation. The condition prohibiting the petitioner from entering into an intimate relationship with any person without first discussing it with and obtaining his agent's approval was held to be both reasonable and not overly broad. The court found that the condition is rationally related to the petitioner's rehabilitation because it forces him to be honest with others by confronting and admitting to his sexually deviant behavior. The condition also serves to protect the public. Because the condition is narrowly drawn and reasonably related to the petitioner's rehabilitation, and the protection of the public, the court concluded that it does not violate his constitutional right to privacy.

Torts

Insurance - Medical Payments Coverage - Subrogation

Jones v. Aetna Cas. and Surety Co., No. 96-1183-FT (filed 24 June 1997) (ordered published 29 July 1997)

Jones was injured in an automobile accident with Alderson. Alderson was uninsured. Jones was insured by Aetna Casualty and Surety Company (Aetna). The Aetna policy provided uninsured motorist and medical payments coverage. Jones made claims for medical expenses under the policy, which Aetna paid.

Jones then sued Alderson and Aetna, seeking recovery for his injuries. A jury awarded Jones $3,500 for his past medical and hospital expenses, $600 for past pain and suffering and nothing for future pain and suffering. After the verdict, Aetna sought as a setoff the $2,600 it already had paid to Jones under the policy's medical payments provision. The trial court denied the setoff.

The court of appeals, in a decision authored by Judge Fine, reversed. Section 632.32(4)(b) of the Wisconsin Statutes provides in pertinent part that "under the medical or chiropractic payments coverage, the insurer shall be subrogated to the rights of its insured to the extent of its payments." The appellate court concluded that this statute is plain and unambiguous. When an insurer makes payments to or on behalf of its insured under the medical payments portion of its policy, it is subrogated to its insured's right to recover "to the extent of its payments." Contrary to Jones's argument and the trial court's holding, the statute does not require that an insurer named as a defendant plead setoff or file a counterclaim in order to recover payments it made to or on behalf of its insured. Subrogation prevents the insured from recouping a windfall double recovery. In this case, to deny Aetna its statutory subrogation rights would give Jones an impermissible windfall.

Worker's Compensation- Coworkers - Loaned Employees

Borneman v. Corwyn Transport Ltd., No. 96-2511 (filed 3 June 1997) (ordered published 29 July 1997)

Jason was killed when material on a flatbed trailer fell on him while he was loading it. The accident occurred at Jason's place of employment, Major Industries Inc. His surviving spouse commenced an action against the trucking company alleging that its driver was negligent in Jason's death. The circuit court dismissed the complaint based upon a summary judgment determination that the driver was an employee "on loan" by the trucking company to Major Industries; thus, the driver was Jason's "coworker" and the claim barred by section 102.03(2) of the Wisconsin Statutes.

The court of appeals, in an opinion written by Judge Mangerson, reversed, applying the loaned employee test originally set forth in Seaman Body Corp. v. Industrial Comm'n, (1931). The court examined whether 1) the employee consented to work for a special employer, thus creating a "new, superseding working relationship"; 2) "the temporal relationship between the formation of the contract of special employment and the actual commencement of work"; and 3) the power of the special employer to "control" the job. The court held that the truck driver was not a loaned employee because the driver did not consent to a new employment contract with Major Industries immediately before the fatal accident, "did not enter upon a special employment contract to do work 'of and for' Major Industries, and did not participate in the loading of the truck under Major's control." Although there was a factual dispute over the driver's role in the loading process, it did not present a genuine issue of material fact. The case was remanded for trial on the issue of the driver's negligence.

Claims Against the Tortfeasor- Pain and Suffering - Future Medical Expenses

Threshermens Mut. Ins. Co. v. Page, No. 95-2942 (filed 15 April 1997) (ordered published 29 July 1997)

A worker's compensation carrier made payments to an injured employee and began this action against the tortfeasor. Before trial, the judge entered an order precluding the insurer from presenting a claim for pain and suffering or future medical expenses; the judge limited the insurer to payments that already had been made.

The court of appeals, in an opinion written by Judge Wedemeyer, reversed. Section 102.29(1) of the Wisconsin Statutes clearly and unambiguously requires three elements: "1) the action must be grounded in tort; 2) the action must be one for the employee's injury or death; and 3) the injury or death must be one for which the employer or its insurer has or may have liability." The statute "clearly allows the injured employee or the insurer to commence an action against the third-party tortfeasor and grants each the 'same rights' to make a claim or maintain an action." The insurer was entitled to assert the pain and suffering claim even if the employee was not actively participating in the claim. For the same reason the insurer was entitled to bring a claim for future medical expenses that it may incur. The uncertainties inherent in predicting the future present ordinary questions of fact for the trier.

Benefits - Former and Present Employers
- Carpal Tunnel Syndrome

North River Ins. Co. v. Manpower Temp. Services, No. 96-2000 (filed 4 June 1997) (ordered published 29 July 1997)

In November 1992 Buczko was employed by Manpower Temporary Services. He was assigned to work at Freedom Plastics Inc. In early 1993 he terminated his employment status with Manpower and became a Freedom employee. On his first day of employment at Freedom, he reported pain in his fingers and hand that was later diagnosed as carpal tunnel syndrome. Buczko claimed that he suffered the pain earlier, while employed by Manpower, but had not reported it. An administrative law judge found that Freedom was the responsible employer because Buczko had not experienced any disability until he first reported the pain. The LIRC adopted the finding but the circuit court reversed based upon medical evidence that the "materially contributing cause" occurred before the day Buczko reported the pain.

The court of appeals, in an opinion written by Judge Nettesheim, reversed. The "time of injury" is defined by section 102.01(2)(g) of the Wisconsin Statutes. Although the court recognized that "it may appear unfair to obligate Freedom for Buczko's worker's compensation benefits in light of Buczko's single day of work as a Freedom employee," the LIRC properly determined that Buczko suffered no disability while working for Manpower: "[h]is carpal tunnel syndrome had not yet progressed to the point where it had '[ripened] into a disabling affliction.'"

This column summarizes all decisions of the 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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