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Supreme Court Digest

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

| Criminal Law | Criminal Procedure |
| Insurance | Municipal Law |
| Torts | Worker's Compensation |

Property Damage - Covered Occurrence

Smith v. Katz, No. 96-1998 (filed 22 June 1999)

The Smiths bought a vacant lot from Giuffre and contracted with a builder for a new home. The foundation collapsed several times when the excavation filled with water, causing delays and additional expense. The Smiths also complained that after the house was completed, ground water pressure was causing additional damage. The Smiths filed suit against their builder, an engineer, and Giuffre. The claims against Giuffre alleged breach of warranty and misrepresentation. West Bend Insurance intervened, asserting that the claimed damages did not trigger its duty to defend or indemnify Giuffre. The circuit court granted a declaratory judgment in West Bend's favor. The court of appeals affirmed.

The supreme court, in an opinion written by Justice Prosser, also affirmed. The case was before the supreme court on a motion for reconsideration of its decision at 218 Wis. 2d 442, 578 N.W.2d 202 (1998). In its initial opinion, the court ruled that the only West Bend policy in the record predated the occurrence of the damage. The motion to reconsider involved another West Bend policy that did apply to the period when damage occurred. Justice Prosser explained that the court originally granted the petition for review in order to analyze and interpret the "premises you sell" exclusion in the standard form commercial general liability insurance policies. The supreme court did not reach that issue, however, because it held that Giuffre had no coverage under the policy.

The supreme court focused on three claims against Giuffre: 1) breach of warrant; 2) "strict responsibility misrepresentation"; and 3) negligent misrepresentation. Nowhere did the plaintiffs allege that Giuffre caused "property damage," based on the allegations in the complaint. "[A] complaint claiming strict responsibility misrepresentation or negligent misrepresentation must contain some statement about physical injury to tangible property, some reference to loss of use, or some demand for relief beyond money damages if the complaint is to satisfy the requirement that 'property damage' be alleged within the four corners of the complaint."

The court next addressed ("for the sake of argument") whether the complaint against Giuffre alleged an "occurrence" covered by the policy. After reviewing the applicable precedents, Justice Prosser concluded that "at some future date" the court would have to decide whether strict liability or negligent misrepresentations were "accidents" covered under liability policies.

The court then addressed the issue of causation. Based on its review of the record, the court held that Giuffre's alleged misrepresentations did not cause physical injury to the Smiths' property. The Smiths decided to build the house, they hired a contractor and an engineer to assist them, and they decided to continue construction even after the foundation collapsed "three or four times."

Municipal Courts - Power to Order
Out-of-State Defendants to Appear Personally

City of Sun Prairie v. Davis, No. 97-1651 (filed 18 June 1999)

This case involved an OWI prosecution for the violation of local OWI ordinances enacted by the City of Sun Prairie. The municipal court entered a default judgment against the defendant, an Illinois resident, because he failed to comply with a municipal court order requiring him to personally appear at the trial of the OWI civil forfeiture action. This action was taken even though the defendant's attorney was present.

The issue before the supreme court was whether a municipal court has the inherent authority to enter such an order. In a unanimous decision authored by Justice Bablitch, the supreme court held that a municipal court does not have inherent authority to order an out-of-state defendant to personally appear at a trial on a civil forfeiture action. Accordingly, it vacated the default judgment and remanded the case to the municipal court for proceedings on the merits.

In reaching this conclusion the court likened the order requiring the defendant to personally appear to a subpoena. The power of a municipal court to authorize the subpoena of a defendant is unquestioned when the defendant is within Wisconsin. However, there is no statutory authority for a municipal court to subpoena, or order the presence of, an out-of-state defendant. The court further determined that the existence of the municipal court and the orderly and efficient exercise of its jurisdiction are not dependent upon the personal presence of the defendant and, therefore, a municipal court does not have inherent authority to order an out-of-state defendant to appear personally at trial in a civil forfeiture action.

Recreational Use Immunity - Spectators - Team Sports

Meyer v. School District of Colby, No. 98-0482 (filed 18 June 1999)

Plaintiff attended a high school football game. She was injured when the wooden bleachers broke as she was descending after the game. The plaintiff sued the school district. The circuit court dismissed based upon recreational use immunity, and the court of appeals affirmed. The court held that "the organized team sport activity exception [Wis. Stat. § 895.52(1)(g)] does not extend to spectators who are not participants in the excepted activity and whose injuries do not arise out of the team sport activity of the actions of participants in that activity."

The supreme court, in an opinion written by Chief Justice Abrahamson, reversed. Without dispute, the junior varsity football game was an organized sports activity sponsored by the school district and conducted on its property. Section 895.52(1)(g) "neither includes nor excepts spectators." Prior cases compelled the court to "consider not only that the plaintiff was a spectator but also the activity at which the plaintiff was a spectator." The court held that spectators also fall within the exception. The statute on its face does not restrict the exception to team players. Nor did public policy require a different construction: "there is no shortage of facilities for organized team sport activities that an owner sponsors." Rather, "organized team sport facilities are constructed to attract the public to the owner's sponsored events." Finally, the court rejected the argument that because another exception applies where a governmental body charges admission to spectators, it follows that an entity "not charging an admission fee to spectators should be immune from liability." These are two separate exceptions.

Notice of Claim - Estoppel - "Dual Persona" Doctrine

Riccitelli v. Broekhuizen, No. 98-0329-FT (filed 24 June 1999)

Dr. Riccitelli was enrolled in a four-year residency program at Sinai-Samaritan. The program was run under an "affiliation agreement" between Aurora Health Care Inc., the hospital's owner, and the U.W. Medical School. In his fourth year, Riccitelli received notice that the supervising committee would not certify his completion of the program. He participated in a "remediation" program but was terminated from the residency in September 1995. Riccitelli brought an action seeking an injunction barring his termination as well as damages. The action failed and Riccitelli was terminated. In 1997 he filed this action alleging interference with contract against Drs. Broekhuizen and Hagarty, who had supervised parts of the residency program. The circuit court dismissed the complaint because Riccitelli had failed to file a notice of claim, as required by statute. The court of appeals reversed, ruling Broekhuizen's and Hagarty's "dual" employment by the state and Aurora forgave the need for a notice of claim.

The supreme court, in an opinion written by Justice Wilcox, reversed. The issue was "whether Dr. Riccitelli's failure to timely file a notice of claim with the state, pursuant to Wis. Stat. section 893.82, mandates dismissal of Drs. Broekhuizen and Hagarty from this action." It was undisputed that Riccitelli failed to give the notice. Nor did the court agree that Hagarty and Broekhuizen were "similarly situated." Hagarty had not been a party to the 1995 action in which Riccitelli sought a court order permitting him to complete the residency. The only evidence in the record showed that Hagarty was a state employee. The court granted her judgment as a matter of law.

The court next addressed Broekhuizen. It refused to apply the doctrine of judicial estoppel to preclude Broekhuizen from arguing he was a state employee. Nothing he said in the earlier suit was "irreconcilably inconsistent" with his assertions in this case. Rather, Broekhuizen merely addressed the multiple roles that he played teaching medical students, supervising residents, and practicing medicine. He said nothing about his employer. The supreme court also refused to apply the doctrine of "equitable estoppel" to bar Broekhuizen's assertion of state employment.

Examining the dual persona doctrine, the court held that it should not be applied to "circumvent a party's failure to file a timely notice of claim" under section 893.82(3) of the Wisconsin Statutes. Such a use failed to comport with the purpose behind the notice of claim statute and the dual persona doctrine. Moreover, even if it had applied, Riccitelli failed to demonstrate all the elements of the dual persona doctrine; that is, "the two persona must be completely independent from and unrelated to one another such that the law recognizes them as separate legal persons." (Emphasis original.)

Finally, the court rejected Riccitelli's arguments that the notice of claim statute was unconstitutional as it applied to him.

Medical Malpractice - Informed Consent -
Contributory Negligence - Jury Instructions

Brown v. Dibbell, No. 97-2181 (filed 23 June 1999)

The plaintiff sued the defendant health-care providers for complications arising from the performance of bilateral mastectomies. The jury found that one doctor, Dibbell, negligently had obtained the plaintiff's consent to surgery. It exonerated another doctor on the informed consent claim and found that neither one had negligently treated her. The jury also determined that the plaintiff was 50 percent causally negligent for failing to exercise ordinary care with respect to her own health. The defense brought post-verdict motions challenging the jury's findings and also asserting error in the judge's refusal to give a requested instruction. The judge denied the motions but the court of appeals reversed and remanded for a new trial.

The supreme court, in a decision authored by Chief Justice Abrahamson, affirmed. The court addressed several key issues regarding informed consent claims. Initially, it concluded "that as a general rule patients have a duty to exercise ordinary care for their own health and well-being and that contributory negligence may, under certain circumstances, be a defense in an informed consent action."

The court then turned to "three aspects of the patient's duty." First, patients "must tell the truth and give complete and accurate information about personal, family, and medical histories to a doctor to the extent possible in response to the doctor's requests for information when the requested information is material to a doctor's duty as prescribed by section 448.30, and that a patient's breach of that duty might, under certain circumstances, constitute contributory negligence. Error occurred because the judge did not give an instruction "tailored" to the plaintiff's disclosures in this case. Second, "a patient's duty to exercise ordinary care does not impose on the patient an affirmative duty to ascertain the truth or completeness of the information presented by the doctor; nor does a patient have an affirmative duty to ask questions or independently seek information." For these reasons, juries normally should not be instructed that the plaintiff can be found "contributorily negligent for failing to ask questions" or to undertake independent research. Third, "except in a very extraordinary situation, a patient is not contributorily negligent for choosing an available medical mode of treatment presented by a doctor." The evidence did not present an extraordinary situation.

The court then turned to the defendant's allegation that the judge erred in not giving instructions relating to section 448.30 of the Wisconsin Statutes, which frees the doctor from providing certain kinds of information to the patient, and the "optional fourth paragraph" of Wis JI-Civil 1023.2, on informed consent. This discussion is closely tied to the record. In summary, the supreme court held that the jury should have been instructed about the defenses found in section 448.30 because the evidence so warranted. The language in Wis JI-Civil 1023.2, however, was "misleading" and should not have been given in the manner suggested by the defense.

Traveling Employee - Acts Reasonably Necessary
for Living or Incidental Thereto

Wisconsin Electric Power Co. v. Labor and Industry Review Commission, No. 97-2747 (filed 22 June 1999)

Overbye was employed as an engineer for Wisconsin Electric Power Company (WEPCO). WEPCO sent him to a business-related seminar in the Dallas-Fort Worth area. The seminar was scheduled to end at noon on a Friday. Overbye took advantage of a WEPCO travel policy under which the company would reimburse him for an extra night's lodging and expenses if he opted for a return flight that departed on a weekend day instead of one that left on Friday, thereby reducing the airfare the company would have to pay.

After the seminar concluded on Friday afternoon, Overbye, his wife (who had joined him in Texas) and another WEPCO employee ate lunch and then set off in a rental car to do some sightseeing in nearby Fort Worth. On that trip the trio was involved in a car accident that killed Overbye's wife and caused serious injuries to Overbye. He himself died as a result of his injuries following the hearing in this case.

Overbye's guardian petitioned for various benefits and medical expenses under the Worker's Compensation Act (WCA). The Labor and Industry Review Commission affirmed the decision of the administrative law judge ordering WEPCO to compensate Overbye, determining that Overbye's sightseeing was an act "reasonably necessary for living or incidental thereto" under the "traveling employee" provision of the WCA. See Wis. Stat. § 102.03(1)(f) (which provides that "acts reasonably necessary for living or incidental thereto" shall not be regarded as a deviation for a private or personal purpose when determining coverage under the WCA).

In a unanimous decision authored by Justice Crooks, the supreme court concluded that LIRC's application of the traveling employee statute to the facts of this case was reasonable and was supported by findings of fact based on credible and substantial evidence. The statute establishes a presumption that an employee traveling on business is performing services arising out of and incidental to his or her employment at all times until he or she returns. This presumption continues unless it is rebutted by evidence to the contrary. Two things must be proved in order to rebut the presumption. First, it must be established that the employee deviated from his or her business trip for a private or personal purpose. Second, it must be shown that the deviation, although for a personal purpose, was not an act reasonably necessary for living or incidental thereto. An employee's actions are reasonably necessary for living or incidental thereto as long as they can be considered usual and proper customary conduct while living away from home.

In making these determinations the focus must be upon the particular facts and circumstances involved in the case at bar, not on generalized synopses of appellate court conclusions in past cases involving different fact scenarios. In this case it was reasonable for LIRC to conclude that Overbye's sightseeing was reasonable recreation incidental to living. The court noted that the injury occurred on Friday afternoon while WEPCO continued to benefit financially from Overbye's stayover in Texas. Further, the sightseeing trip was confined to the Dallas-Fort Worth metro area. Finally, there is no evidence of any illegal motive or behavior on Overbye's part.

The supreme court characterized as "apt" the statement of counsel for LIRC during oral argument before the court that this case "pushes the envelope" of the kinds of behavior by traveling employees that might be considered incidental to living under the statute cited above. Nevertheless, LIRC's application of the statute to the facts of this case was reasonable and was supported by findings of fact based on credible and substantial evidence.

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.