Wisconsin Lawyer
Vol. 85, No. 5, May 2012
Appellate Procedure
Error – Waiver/Forfeiture
Nickel v. United States, 2012 WI 22 (filed 8 March 2012)
Ambac was an insurer of financial guarantees (for example, credit-default swaps) that began imploding in 2007. To protect Ambac's shareholders, the Wisconsin Commissioner of Insurance brought in state court an action that ultimately resulted in a court-approved rehabilitation plan that segregated Ambac's "most potentially damaging liabilities." The U.S. government essentially sat out the state court proceedings, which involved a tax refund of nearly $700 million, on grounds that the matter should be before federal courts. Following a five-day hearing, the circuit court confirmed the rehabilitation plan. The United States then filed a notice of appeal with the Wisconsin Court of Appeals, which dismissed the appeal because the U.S. Department of Justice attorney who signed the notice was not authorized to practice law in Wisconsin. The United States appealed.
The Wisconsin Supreme Court affirmed the court of appeals, albeit on different grounds, in an opinion authored by Justice Crooks. The court held that the United States had waived its right to appeal by essentially doing nothing to litigate its claims before the circuit court other than filing the notice of appeal (see ¶ 9). The opinion reviews and reemphasizes long-standing doctrine governing preservation of error while carefully recounting the United States' many omissions and circumventions in this action.
"The importance to the system of real appellate review, and not merely endless error-correcting review, requires holding parties accountable for the litigation strategies they choose in the circuit court" (¶ 24). The court rejected the United States' contention that the circuit court lacked subject matter jurisdiction and that this somehow exempted it from the "usual rule concerning waiver" (¶ 27).
"The reasons for the rule requiring parties to raise issues in the circuit court or waive the right to raise them on appeal were clearly stated by this court in the cases cited above. The United States' approach in this case – declining to litigate issues in circuit court and then stating that it was filing a notice of appeal because it was seeking to 'preserve its right to appeal' – contravenes without justification the accepted rule that issues not raised in the circuit court are deemed to be waived. We fail to see how the reasons underlying those principles apply with any less force when the United States government is a party. In any event, a party who has refused opportunities to challenge an injunction when it had the opportunity to do so in the circuit court is not in a proper position to claim a narrow subject matter jurisdiction exception to circumvent the obstacle posed by the waiver rule. As this case illustrates, to permit parties to do so would wreak havoc by allowing a party to sit out expensive litigation and then give it a free 'do-over.' Such an approach is simply unfair to the parties who at significant expense did participate in the proceedings, and it would be a pointless waste of scarce court system resources.… We therefore find no basis for exempting the United States from that rule under these circumstances" (¶ 31).
The supreme court also rebuffed the United States' invocation of Wis. Stat. section 752.35, which permits discretionary review in some instances. "The United States never appeared in the circuit court proceedings. It has acknowledged its strategic decision not to litigate in state courts. A party is entitled to make such a decision, but it is not entitled to reversal when its strategy has 'proved ineffective.' Discretionary reversal is not justified under these circumstances" (¶ 34).
"The United States conceded at oral argument that it made an intentional decision not to litigate any of the issues involved in the circuit court. Our case law is clear and consistent – failure to preserve issues means that they are waived. Applying well-established principles of law that apply equally to the government when it is a party, we hold that such a decision precludes the United States from pursuing relief in the court of appeals" (¶ 37).
Chief Justice Abrahamson concurred but wrote separately to emphasize the majority's recognition of the distinction between "forfeiture" and "waiver" (this was a forfeiture case), urging the use of "correct terminology" in future cases (¶¶ 40-41). The Chief Justice also asked the Judicial Council and other interested bodies to look into the wording of several rules of appellate procedure that may require modification (see ¶ 43).
Civil Procedure
Service of Process – Fundamental Defects – Defaults
Johnson v. Cintas Corp. No. 2, 2012 WI 31 (filed 27 March 2012)
Johnson was injured while riding in a car insured by Cintas, Johnson's employer. Cintas refused to pay any benefits, and so Johnson filed a suit alleging breach of contract and bad faith. Johnson named as a defendant in the summons and complaint the Cintas corporate entity but served his summons and complaint on the registered agent for Cintas No. 2, a wholly owned subsidiary of Cintas. Cintas is not registered or licensed in Wisconsin and has no registered agent for service of process. Neither Cintas nor Cintas No. 2 answered the complaint. The circuit court eventually entered a default judgment against Cintas No. 2 after amending the pleadings.
In a published decision the court of appeals reversed because Johnson had named the wrong party; it held that the circuit court lacked personal jurisdiction over Cintas No. 2. See 2011 WI App 5.
The supreme court affirmed in a majority opinion written by Justice Ziegler that assessed the distinction between technically defective service of process and service so fundamentally defective that the circuit court lacks personal jurisdiction (see ¶ 26). A "straightforward application" of case law (¶ 40) led to this conclusion: "the circuit court erred as a matter of law when it reconsidered its order vacating the default judgment against Cintas No. 2. Johnson's failure to name Cintas No. 2 as a defendant in his summons and complaint, contrary to Wis. Stat. §§ 801.02(1) and 801.09(1), constituted a fundamental defect that deprived the circuit court of personal jurisdiction over Cintas No. 2, regardless of whether or not the defect prejudiced Cintas No. 2. Because the circuit court lacked personal jurisdiction over Cintas No. 2, the default judgment entered against Cintas No. 2 is void" (¶ 39).
The supreme court distinguished case law in which the plaintiff has misnamed a single corporation; this case involved two separate corporate entities in which the wrong one was named and served (see ¶ 41). The amended complaint effectively substituted the "wrong party," Cintas, "with another existing and entirely new party, Cintas No. 2" (id.).
Justice Bradley, joined by Chief Justice Abrahamson, dissented. They concluded that this case fell "squarely on the technical side" of the line between fundamental and technical defects (¶ 52). "The majority reaches the wrong result by dodging the applicable standards for mere misnomers, sidestepping precedent, and crafting an unreasonable and unnecessary new rule" (¶ 53).
Creditor-Debtor Law
Supplemental Proceedings – Non-Judgment-Debtor Third Party
Crown Castle USA Inc. v. Orion Constr. Group LLC, 2012 WI 29 (filed 22 March 2012)
Larson was the sole member of two corporations. Orion Construction Group (Orion 1) built cell towers but ceased operations in 2006. Orion Logistics (Orion 2) builds wind turbines. Crown Castle brought an action against Orion 1 in Pennsylvania courts, receiving a default judgment of nearly $500,000. Crown Castle filed its judgment with the clerk of a Wisconsin circuit court. The court ordered a supplemental proceeding against Orion 1 pursuant to Wis. Stat. section 816.06, which it later expanded to include Larson's interest in Orion 2. In a published decision, the court of appeals affirmed the expanded supplemental examination. See 2011 WI App 9.
The supreme court reversed in a 4-3 decision written by Justice Gableman. "It is clear that the only compelled testimony expressly authorized by this provision is that of the judgment debtor. No language in § 816.06 expands that authority to include the compelled testimony of a non-judgment debtor third party. Indeed, no mention whatsoever is made of such a party" (¶ 19).
Nonetheless, the court recognized that some latitude must be given in situations in which corporations are the party debtors, if only because such business entities can speak only through individuals who are not parties (see ¶ 22). "These individuals may include corporate officers, employees, former employees, and similarly situated individuals who have information relevant to the judgment debtor corporation's assets. The scope of testimony these individuals may provide, however, is limited to that information relevant to the judgment debtor corporation, that is, the actual entity that is subject to the supplemental proceeding. Accordingly, we conclude that because ch. 816 states that corporations may be judgment debtors, the language of § 816.06 allows for compelled testimony from some individuals who are not named parties to the action. That does not mean, however, that Wis. Stat. § 816.06 necessarily allows for a judgment creditor to compel the testimony of a non-judgment debtor third party at a supplemental proceeding. No language in Wis. Stat. § 816.06 grants this right to the judgment creditor" (¶¶ 23-24).
The majority, persuaded by the statute's "silence" on this point, refused to create a right in circumstances for which the legislature itself had not done so. The majority also looked to the "context" of section 816.06 along with its legislative history, which dates to 1856 and later revisions. This conclusion, said the majority, was also consistent with the few extant cases.
Chief Justice Abrahamson dissented, joined by Justice Bradley and Justice Crooks. "The majority opinion is an anti-creditor opinion that emasculates Chapter 816 of the statutes. It empowers debtors to hide their assets from creditors who have procured valid, enforceable judgments. It will hinder the ability of all judgment creditors (individuals and corporations alike) to recover payment from all judgment debtors (individuals and corporations alike)" (¶ 50).
Criminal Law
Sex-Offender Registration – Provision of Address Where Offender Will Be Residing – Homelessness
State v. Dinkins, 2012 WI 24 (filed 13 March 2012)
In 1999, Dinkins was convicted of a sex offense and received a 10-year sentence. He served his entire sentence in prison without the benefit of parole and thus would not be under the supervision of the Department of Corrections (DOC) upon his release from the institution. (The defendant was sentenced before the implementation of truth-in-sentencing in Wisconsin.)
As a collateral consequence of his 1999 conviction, Dinkins was required by Wis. Stat. section 301.45 to register as a sex offender. This statute provides that 10 days before a defendant is scheduled to be released from prison, he or she must provide certain information to the DOC, including "[t]he address" at which he or she "will be residing." A knowing failure to comply with the registration requirements is, with one exception that is inapplicable in this case, a Class H felony.
The defendant failed to provide the address at which he would be residing 10 days before his scheduled release from prison and was charged with violating the registration statute on the eve of his scheduled release. The circuit court found that Dinkins attempted to comply with the registration requirements but was unable to find housing before his release. Nonetheless, it convicted him of the crime in a bench trial. In a published decision, the court of appeals reversed the conviction. See 2010 WI App 163.
In a majority decision authored by Justice Bradley, the supreme court affirmed the court of appeals. The court agreed with the state that homeless registrants are not exempt from registration requirements and that homelessness is not a defense to failing to comply with the registration requirements (see ¶ 61).
However, the court concluded that "a registrant cannot be convicted of violating Wis. Stat. § 301.45(6) for failing to report the address at which he will be residing when he is unable to provide this information. We determine that a registrant is unable to provide the required information when that information does not exist, despite the registrant's reasonable attempt to provide it. Here, the circuit court found that Dinkins attempted to comply with the statute, that he was unable to find housing on his own, and that the DOC would have to find housing for him. These findings are not clearly erroneous" (¶ 5).
The majority observed that the legislature anticipated that a registrant might be unable to provide the information required by the statute and set forth therein an alternative procedure for monitoring the whereabouts of registrants who are unable to provide an address without imposing criminal liability.
"[T]he DOC can require a registrant who is unable to provide an address to report to a local police station upon release. If, upon reporting to the police station, the registrant continues to be unable to provide an address, the DOC can require him to continue reporting to the police station on a regular basis until he is able to do so. Meanwhile, it can require the registrant to provide information about the places he is frequenting" (¶ 40) (citations omitted). By exercising this authority, "the DOC can ensure that a registrant who is unable to provide required information provides its functional equivalent and therefore can be effectively monitored without resorting to a preemptive prosecution" (¶ 41).
Justice Roggensack filed a concurring opinion. Justice Ziegler filed a dissent that was joined in by Justice Gableman.
Criminal Procedure
Postconviction Motions – Wis. Stat. section 974.06 – "In Custody Under Sentence of a Court" Requirement
State v. Sutton, 2012 WI 23 (filed 8 March 2012)
Sutton was convicted at a bench trial of retail theft. He was sentenced to a single day of incarceration. On appeal, the court of appeals accepted postconviction counsel's no-merit report, relieved defendant's counsel of further representation, and denied the defendant's request to remand the cause to the circuit court to determine whether the defendant knowingly, intelligently, and voluntarily waived his right to a jury trial. The court of appeals stated that to the extent counsel conceded that she was ineffective when filing the initial postconviction motion in this case, relief could be pursued under Wis. Stat. section 974.06. In a unanimous decision authored by Chief Justice Abrahamson, the supreme court reversed the court of appeals.
Three facts were significant to the court in determining the issues, namely whether the court of appeals erred in concluding that the defendant could raise the issue of postconviction counsel's ineffective assistance of counsel in a section 974.06 motion and further erred in failing to remand the matter to the circuit court to allow the defendant to pursue a new or amended postconviction motion.
Those salient facts were the following: 1) The circuit court conducted a deficient personal colloquy with the defendant relating to his waiver of the right to a jury trial; the colloquy failed to inform him that, at a jury trial, a 12-person jury would have to agree on all elements of the crime charged. 2) The defendant was not in custody when he sought postconviction relief in the circuit court or when he appealed his conviction to the court of appeals. 3) Postconviction counsel filed a defective postconviction motion and thus failed to preserve the defendant's challenge to the validity of his jury trial waiver; counsel knew that the defendant claimed lack of awareness of the right to a unanimous verdict at the time of the waiver but neglected to allege this fact in the motion (see ¶¶ 4-6).
The supreme court concluded that "the court of appeals erred as a matter of law in ruling that the defendant had an avenue of relief through Wis. Stat. § 974.06. The defendant could not pursue a § 974.06 motion, which is available only to 'a prisoner in custody under sentence of a court or a person convicted and placed with a volunteers in probation program under s. 973.11.' The defendant fit neither of these categories. The court of appeals' error of law deprived the defendant of any opportunity for review of an on-its-face deficient jury trial waiver colloquy or the clear error by postconviction counsel in filing a defective postconviction motion" (¶¶ 7-8).
The supreme court found that the court of appeals' opinion and order "had the unintended effect of denying the defendant any opportunity to be heard despite a trial court colloquy deficient on its face and an error by postconviction counsel" (¶ 49). "[T]he court of appeals did not intend to leave the defendant without a remedy. The court of appeals had discretion to remand the matter to the circuit court for the defendant to file a new motion, an amended motion or a motion for reconsideration, despite the fact that the defendant's claim relating to the waiver of a jury trial was not properly preserved in the initial postconviction motion. The court of appeals chose not to so exercise its discretion, but the discretionary decision rested on a mistake of law" (¶ 48).
Accordingly, the supreme court reversed the opinion and order of the court of appeals and remanded the matter to the court of appeals to reject the no-merit report, reinstate the defendant's direct appeal rights, and remand the matter to the circuit court for counsel to file a new or amended motion for postconviction relief (see ¶ 50).
Insurance/Appellate Procedure
Oral Agreement between Insurance Carrier and Insured to Fund Settlement – Wis. Stat. section 807.05 – Unjust Enrichment Rejected as Theory for Recovery of Payments Made by Carrier – Final Orders for Purposes of Appeal
Admiral Ins. Co. v. Paper Converting Mach. Co., 2012 WI 30 (filed 27 March 2012)
A woman was severely injured while working on a machine manufactured by Paper Converting Machine Co. (PCMC). When PCMC learned about the accident, it was self-insured. Several months later, PCMC was acquired by another company and it purchased additional insurance coverage, including a claims-made policy, issued by Admiral Insurance Co. (Admiral), that provided $2 million in products/completed-operations liability coverage. As part of its application for insurance, PCMC disclosed to Admiral's underwriting department all pending legal cases as well as known accidents that could reasonably result in litigation, including the accident involving the woman referred to above.
Approximately one year after the policies were issued, the woman filed suit against PCMC, which notified Admiral's claims department. Admiral was not named as a party. Admiral did, however, participate in mediation and, during settlement negotiations, it entered into a funding agreement with PCMC to contribute its policy limits ($2 million) toward settlement of the lawsuit. The woman agreed to accept $3.5 million to settle the suit and PCMC's attorney, the woman, and her attorney signed a written settlement agreement, but Admiral did not sign it.
After the settlement agreement was negotiated but before sending a payment under the funding agreement, Admiral changed its position on coverage. It contended, for the first time, that there was no coverage for the woman's accident under the known-claims exclusion of its policy. However, it paid the $2 million as it had agreed to do. Admiral then filed an action against PCMC, seeking a declaration that its policies provided no coverage for the woman's claim and reimbursement of the $2 million. PCMC answered and filed a separate counterclaim for attorney fees. All parties moved for summary judgment.
The circuit court entered a decision and order on March 26, 2009. It concluded that PCMC was entitled to summary judgment and ordered the case dismissed. The parties asserted that, after the entry of this order, they agreed to delay entry of a final judgment because PCMC intended to pursue its counterclaim for attorney fees, which had not been addressed in the court's decision and order. They also asserted that PCMC ultimately decided not to pursue this counterclaim. The circuit court entered judgment on July 8, 2009. The judgment provided that "[t]his is a final judgment for purposes of appeal" (¶ 18). On Aug. 12, 2009, Admiral filed an appeal.
The first issue before the supreme court was whether the court of appeals erred when it dismissed as untimely the appeal Admiral filed on Aug. 12, 2009. If the circuit court's decision and order of March 26 was a final order, then the appeal was not initiated within 90 days as is required. On the other hand, if the final judgment was not entered until July 8, then Admiral's appeal was timely.
In a unanimous decision authored by Justice Bradley, the supreme court indicated that "[i]f we conclude that there is any ambiguity in an order or judgment about whether it disposes of the entire matter in litigation as to one or more of the parties, we will construe the ambiguity so as to preserve the right to appeal. Under these circumstances, although the March 26 order arguably disposed of the entire matter in litigation between the parties, we cannot say on this record that it unambiguously did so. Accordingly, we construe it as nonfinal, pursuant to our policy of construing any ambiguity to preserve the right of appeal" (¶ 3).
The court recounted that in Wambolt v. West Bend Mutual Insurance Co., 2007 WI 35, 299 Wis. 2d 723, 728 N.W.2d 670, it directed that final orders and final judgments state that they are final for purposes of appeal. However, "[t]he focus of the ambiguity inquiry is on the language of the order or judgment, not on the finality statement. The absence of a finality statement cannot be used to create ambiguity when it is unambiguous that the order or judgment disposed of the entire matter in litigation as to one or more of the parties" (¶ 29).
In this case, the nature of PCMC's counterclaim was unclear. It was not a claim for fees under a fee-shifting statute, which would not affect the finality of a judgment that disposes of the matter in litigation (see ¶ 33). Rather, the counterclaim makes reference to the Uniform Declaratory Judgment Act but does not otherwise specify the theory of law upon which the counterclaim is made. Thus, the supreme court could not say that the circuit judge's March 26 order unambiguously disposed of the entire matter in litigation and was thus a final order for purposes of appeal (see ¶ 36).
The court next turned to the merits of the appeal and Admiral's assertion that there was no coverage under its policy because the policy had an exclusion for known claims and because PCMC knew about the accident, as evinced by the disclosure it made to Admiral's underwriting department before the policy was issued.
The supreme court declined to decide the coverage question and assumed, without deciding, that there was no coverage under the policy. It noted that this case involved two agreements between PCMC and Admiral: the first was the insurance contract and the second was Admiral's oral agreement to contribute $2 million to the settlement.
Admiral argued that the funding agreement was unenforceable because it was not made in court or memorialized in writing; this argument was based on Wis. Stat. section 807.05. The supreme court concluded that "Admiral's reliance on this statute is unfounded because it does not apply to the funding agreement. The statute addresses agreements 'between parties or their attorneys,' and Admiral was not a party to the lawsuit between [the injured woman] and PCMC" (¶ 44). The funding agreement thus falls under the "usual rule" that oral agreements are enforceable (see ¶ 45).
Nonetheless, under certain circumstances, a party can be relieved of its contractual obligations. Admiral asserted that it is entitled to restitution because PCMC was unjustly enriched by Admiral's contribution of $2 million toward the settlement agreement. Admiral also argued that it should be relieved of its obligation under the funding agreement because of a mistake of fact.
The supreme court rejected both positions. Under General Accident Fire & Life Assurance Corp. v. Bergquist, 15 Wis. 2d 166, 111 N.W.2d 900 (1961), an insurer cannot recover payments it made pursuant to a settlement agreement based on an unjust enrichment theory (see ¶ 47).
As for mistake of fact, Admiral contended that when it agreed to contribute $2 million to the settlement, it did not know that PCMC had knowledge of the woman's accident before purchasing the policy. Admiral explained that its claims department and its underwriting department are separate entities, and that the claims department agreed to contribute to the settlement because it was unaware that PCMC had disclosed the accident to Admiral's underwriting department.
The supreme court responded that "Admiral cannot claim it made a mistake of fact because the underwriting department knew that PCMC had disclosed the [the woman's] accident, and its knowledge is imputed to Admiral's claims department. The general rule of imputation is well established in Wisconsin. A corporation is charged with constructive knowledge of all material facts of which its agent receives notice while acting within the scope of employment, even if the agent did not actually communicate the knowledge to the corporation" (¶ 53). Further, even if Admiral did make a mistake of fact, the mistake must be mutual to void a contract, and in this case it was not mutual (see ¶¶ 57-58).
Insurance
Pollution Exclusion – Excrement
Hirschhorn v. Auto-Owners Ins. Co., 2012 WI 20 (filed 6 March 2012)
The Hirschhorns' vacation home was invaded by bats, which soon filled the walls with guano. The plaintiffs' efforts to remediate the problem failed and so they declared the house a loss and had it demolished. Their homeowner's insurance company, Auto-Owners, refused to cover the loss on several grounds, including the fact that the policy contained a pollution exclusion. The plaintiffs sued Auto-Owners for bad faith and breach of contract. The circuit court granted summary judgment in favor of the insurer, dismissing the claim. The court of appeals reversed, ruling in a published decision that the pollution exclusion did not reach "biological" processes. See 2010 WI App 154.
The supreme court reversed the court of appeals in a majority opinion authored by Justice Ziegler. First, the court held that bat guano fell within the policy's definition of pollutant (see ¶ 26). "Bat guano, composed of bat feces and urine, is or threatens to be a solid, liquid, or gaseous irritant or contaminant. That is, bat guano and its attendant odor 'make impure or unclean' the surrounding ground and air space … and can cause 'inflammation, soreness, or irritability' of a person's lungs and skin.… These points cannot be seriously contested by the Hirschhorns, who alleged in their complaint that the odor of bat guano was so 'penetrating and offensive' as to render their vacation home unfit to live in" (¶ 33). The policy also explicitly defines waste as an irritant or contaminant (see ¶ 34). These conclusions were consistent with case law (see ¶ 37).
Second, under terms of the policy, the damage to the home resulted from the "discharge, release, escape, seepage, migration, or dispersal" of the bat guano. "As their definitions make clear, these six terms are often synonymous with one another and 'taken together constitute a comprehensive description of the processes by which pollutants may cause injury to persons or property'" (¶ 43).
"[I]n the case before us, we conclude that the alleged loss of the Hirschhorns' vacation home resulted from the 'discharge' [etc.] of bat guano under the plain terms of the policy's pollution exclusion clause. The bat guano, deposited and once contained between the home's siding and walls, emitted a foul odor that spread throughout the inside of the home, infesting it to the point of destruction" (¶ 46).
Chief Justice Abrahamson, joined by Justice Bradley, dissented. They agreed with the court of appeals that the policy's terms were ambiguous and should have been construed in favor of coverage.
Torts
Fires – Double-Damages – Interest
Heritage Farms v. Markel Ins., 2012 WI 26 (filed 16 March 2012)
In 2003, a forest fire caused extensive damage to nearly 600 acres. The plaintiff landowners sued a campground and its insurer for causing the fire, which started when a large burn pile flared up and spread beyond the campground. A jury found the defendants negligent. The plaintiffs also sought double damages under Wis. Stat. section 26.21(1). In an earlier appeal, the supreme court held that the statute is not limited to railroad corporations but applies more broadly to any tortfeasor. The supreme court also held that application of the statute did not require gross negligence. On remand, the circuit court ruled that the statute does not mandate double damages, and that compensatory damages adequately compensated the plaintiffs for the defendants' negligence. In a published decision, the court of appeals affirmed. See 2011 WI App 12.
The supreme court reversed in an opinion written by Justice Ziegler. The court held that "pursuant to § 26.21(1), if it is determined that the owner's property was injured or destroyed by a forest fire that occurred through willfulness, malice, or negligence, then the property owner is entitled to double damages as a matter of course" (¶ 31). The word "may" in the statute is to be read as permissive, not mandatory, but applies only to a property owner's "power or duty to act" with respect to bringing a lawsuit.
"More specifically, § 26.21(1) does not impose upon a property owner, whose property is injured or destroyed by a forest fire, a power or duty to 'recover, in a civil action, double the amount of damages suffered'; indeed, imposing such a duty would be unreasonable. Certainly, the statute does not provide for a penalty if the property owner chooses not to take such action. Rather, § 26.21(1) provides for the opportunity, if the property owner so chooses, to 'recover, in a civil action, double the amount of damages suffered.' Stated another way, pursuant to § 26.21(1), a property owner, whose property is injured or destroyed by a forest fire, may bring a civil action against the tortfeasor to recover double damages" (¶ 37).
The word "if" in the statute, however, mandated the award of double damages "in the event that or on the condition that 'the fire[] occurred through willfulness, malice or negligence.' Stated another way, once it is determined that the forest fire occurred through willfulness, malice, or negligence, the property owner is entitled to double damages as a matter of course" (¶ 39). The court also held that its decision applied retroactively. It found no sound reason for applying this holding prospectively on the record before it (see ¶ 47).
The court next held that Wis. Stat. section 814.04(4) entitled the plaintiffs to 12 percent interest from the date the verdict was received in 2006 even though the defendants' "liability for double damages was not firmly established until our decision today" (¶ 55). The defendants could have stopped the interest from running by tendering the total doubled amount any time after the court received the jury's verdict (see id.). The court rejected, however, the plaintiffs' contention that they were also entitled to 12 percent interest on its award of attorney fees and costs from the date of the verdict (2006) as opposed to the 2009 date when the court awarded attorney fees and costs (see ¶ 58). Finally, the court rejected the defendants' contention that section 814.04 is unconstitutional.
Justice Bradley dissented. She concluded that Wis. Stat. section 26.21 provides for a discretionary, not mandatory, award of double damages (see ¶ 66).
Wisconsin Lawyer
