Attorneys

Legal Malpractice – Statute of Limitation

Bleecker v. Cahill, 2017 WI App 28 (filed 15 March 2017) (ordered published 26 April 2017)

HOLDING: A legal malpractice action accrued for purposes of the statute of limitation when the former client incurred damages; it did not accrue when the allegedly faulty legal advice was given.

SUMMARY: In 2003, a lawyer advised a client about a commercial real estate project that entailed the client building a medical facility that he would then lease to a medical group, Aurora. Under terms of a lease, Aurora agreed to an initial 10-year lease term with three options, each for five years, to extend the lease. The lease included an amortization schedule by which the client would recover his cost of construction.

In 2013, Aurora terminated its lease. The client claimed he only then became aware that Aurora was under no duty to continue amortization payments and that this conflicted with the advice given by the lawyer and left him damaged. The client brought this malpractice action. The circuit court granted summary judgment in the lawyer’s favor, finding the statute of limitation had started to run in 2003 (see ¶ 5).

The court of appeals reversed in an opinion authored by Judge Gundrum. The court held that the statute of limitation did not begin to run until 2013, when the client allegedly incurred damages (see ¶ 15). It did not accrue when the alleged bad advice was given in 2003; “the question for statute of limitations purposes is not whether a suit in 2003 ultimately would have been successful; the question is whether [client] had a claim at that point that was ‘capable of present enforcement’” (¶ 17).  He did not. Had Aurora extended the lease in 2013, the client would have suffered no harm (id.).

Criminal Procedure

Subject-matter Jurisdiction and Competency of Adult Circuit Courts – Conduct Committed by Juvenile Under Age 10 Years – Prosecution Commenced After Actor Became an Adult

State v. Sanders, 2017 WI App 22 (filed 15 March 2017) (ordered published 26 April 2017)

HOLDING: The adult criminal court had subject-matter jurisdiction and competency to adjudicate conduct committed by the defendant when he was younger than 10 years old.

SUMMARY: The state charged defendant Sanders with four felony counts related to sexual activity he engaged in over several years with his younger sister, H.S. Count one of the information charged him with committing repeated sexual assaults of H.S. between 2003 and 2006, a time period when H.S. was 7-9 years old and Sanders was 9-12 years old.

Counts two, three, and four respectively charged Sanders with committing repeated sexual assault of, incest with, and child enticement of H.S. between 2008 and 2012, a time period when H.S. was 12-15 years old and Sanders was 14-18 years old. These acts did not come to the attention of authorities until Sanders was an adult, and they were filed in adult criminal court. A jury acquitted Sanders of count one but convicted him on all remaining counts.

On appeal, Sanders argued the circuit court lacked subject-matter jurisdiction and competency to prosecute him for criminal conduct he allegedly committed when he was under age 10, and his trial counsel performed ineffectively by not moving to preclude introduction at trial of evidence related to acts occurring before the defendant’s 10th birthday. Even though he was acquitted on count one, Sanders contended that he was prejudiced with regard to the other counts when evidence was admitted with respect to conduct that occurred before he was 10.

In a majority decision authored by Judge Gundrum, the court of appeals affirmed. First, with respect to the challenge to the circuit court’s subject-matter jurisdiction regarding count one, the court of appeals invoked recent precedent to conclude that “no circuit court is without subject matter jurisdiction to entertain actions of any nature whatsoever” (¶ 12). “Even where a complaint fails to state an offense known to law [a situation not present here because repeated sexual assault of a child is a crime known to law] … the court must retain subject matter jurisdiction to dispose of the matter” (id.) (citation and internal quotations omitted).

A circuit court’s ability to exercise its subject-matter jurisdiction in individual cases may be affected by noncompliance with statutory requirements. Such a failure may affect the court’s competency to proceed to judgment in the particular case before it.

In the present case, the appellate court concluded that “the circuit court was competent to adjudicate count one as an adult criminal action even though Sanders allegedly committed wrongful acts related to that count prior to the age of ten. Absent statutory language clearly stating otherwise – which is not present in this case – a defendant’s age on the date legal action is initiated, not his [or] her age on the date he [or] she committed the wrongful acts at issue, controls” (¶ 24).

“Absent the running of a statute of limitations period or improper delay by law enforcement once aware of allegations, if an offender is statutorily chargeable as an adult when legal action is initiated, the adult criminal court has competency to exercise its jurisdiction regardless of the offender’s age when he [or] she committed the criminal conduct. If the offender is age ten or older but not yet chargeable as an adult when legal action is initiated, the juvenile court has competency to treat the offender as a delinquent. And if the offender is under age ten when allegations of his [or] her criminal conduct are legally addressed, the juvenile court has competency to treat the child as being in need of protection or services. See Wis. Stat. §§ 938.02(1) & (3m), 938.12(1), 938.13(12)…. These alleged acts [by defendant Sanders] … did not come to the attention of authorities until Sanders was an adult, and thus they were then properly addressed in adult criminal court” (¶ 25).

Sanders also contended that his trial counsel performed ineffectively in failing to object to the jury instructions and verdict form related to the incest count on the ground they were not specific enough so as to require the jury to unanimously agree on one specific act forming the basis of the sexual-contact element of this count. In a discussion that is necessarily fact intensive, the appellate court concluded that Sanders failed to demonstrate he was prejudiced by counsel’s failure to raise such an objection (see ¶ 30).

Judge Reilly filed a concurring opinion.

Expungement – Eligibility

State v. Arberry, 2017 WI App 26 (filed 8 March 2017) (ordered published 26 April 2017)

HOLDING: The defendant was ineligible for expungement because she waited until after sentencing to request it.

SUMMARY: The defendant pleaded guilty to retail theft and was immediately sentenced. Neither party addressed expungement. In a postconviction motion, the defendant sought expungement, which the circuit court denied.

The court of appeals affirmed in an opinion authored by Judge Reilly. In State v. Matasek, 2014 WI 27, 353 Wis. 2d 601, 846 N.W.2d 811, the supreme court held that expungement must be addressed at sentencing. The parties’ failure in this case to address expungement at sentencing precluded its consideration in a postconviction hearing. Matasek controls. Nor was there any factual support that expungement had been “overlooked” and thus was a “new factor” affecting sentencing.

Employment Law

WFEA – Great Weight Deference – “Inference Theory” of Causation

Wisconsin Bell Inc. v. LIRC, 2017 WI App 24 (filed 28 March 2017) (ordered published 26 April 2017)

HOLDING: The Labor and Industry Review Commission’s (LIRC’s) use of the “inference method” of causation in finding violations of the Wisconsin Fair Employment Act (WFEA) is reasonable and the evidence supported LIRC’s determination.

SUMMARY: Carlson suffered from a bipolar disorder while he worked at an AT&T call center for Wisconsin Bell. The call center accommodated him in various ways. In 2010, Carlson was disciplined for “call avoidance” while on the job. He was terminated in 2011 when he allegedly breached provisions of his “back to work agreement.” Carlson challenged both the suspension and the termination. LIRC later found that the 2010 suspension was proper but the termination was improper. The circuit court disagreed; it found that LIRC’s “inference theory of causation” was reasonable but that the factual record was “incomplete” (¶ 26).

The court of appeals reversed in an opinion authored by Judge Brash. The issue was whether LIRC reasonably applied an inference theory of causation in finding that Wisconsin Bell terminated Carlson because of his disability. The court accorded LIRC “great weight deference” in its decision to use the “inference theory” (¶ 33). The issue was not one of “first impression.” Although published case law had not addressed this issue, LIRC had applied it in “numerous cases” (¶ 38). LIRC’s experience qualified the matter for great weight deference (see ¶ 40).

Moreover, LIRC’s application of its interpretation was reasonable. The record adequately showed that Wisconsin Bell “ignored medical evidence” and relied instead ‘upon its own prejudices and assumptions” (¶¶ 54-55).

Insurance

Untimely Notice – UIM Claim

Shugarts v. Mohr, 2017 WI App 27 (filed 14 March 2017) (ordered published 26 April 2017)

HOLDING: An insured failed to provide timely notice of an underinsured motorist (UIM) claim to an insurer and did not rebut the presumption of prejudice.

SUMMARY: Plaintiff Shugarts, a deputy sheriff, was injured when his squad car was struck by another vehicle in October 2010. Progressive insured the tortfeasor’s car. The squad car was insured by Wisconsin Municipal Mutual Insurance Co. (WMMIC) and Shugarts had a personal auto policy issued by Allstate, which included UIM coverage. Litigation proceeded against Progressive and WMMIC, but Shugarts waited until October 2014 to notify Allstate of his UIM claim. The circuit court granted Allstate’s motion for summary judgment based on Shugarts’ failure to provide timely notice.

The court of appeals affirmed in an opinion authored by Judge Stark. The timeliness issue turned on the nature of UIM coverage and the status of other settlement offers; specifically, must a UIM insured provide notice of a UIM claim before a settlement is proposed?

Under case law, “Shugarts was required to provide Allstate with proof of his UIM claim as soon as possible after the incident giving rise to the claim. Under the circumstances of this case, we conclude it was possible for Shugarts to provide proof of claim in January 2012, when Progressive denied coverage for his claim against Mohr. At the very latest, Shugarts should have provided proof of claim in August 2013, when he learned that Progressive’s policy limit was only $50,000.… [At that point] he necessarily knew that, regardless of what settlement offer Progressive might ultimately make, the amount paid would be insufficient to cover his losses” (¶ 24).

Furthermore, Shugarts failed to rebut the presumption that Allstate was prejudiced by his untimely notice. “[I]t is undisputed that Allstate had no opportunity to conduct any investigation until more than four years after the underlying accident, and more than one year after Shugarts commenced the instant lawsuit. Regardless of whether some witnesses are currently available for deposition and medical records are available for inspection, Allstate was deprived of the opportunity to conduct an investigation and interview witnesses while their memories of the underlying events were still comparatively fresh and before they became entrenched in their positions … ” (¶ 30).

Mental Health Law

Wis. Stat. Ch. 51 Emergency Detentions – State Treatment Facilities

City of Madison v. Wisconsin Dep’t of Health Servs., 2017 WI App 25 (filed 9 March 2017) (ordered published 26 April 2017)

HOLDING: The Wisconsin Department of Health Services (DHS) has acted within its statutory authority by designating the Winnebago Mental Health Institute as the only state treatment facility that will accept custody of individuals transported for emergency detention and treatment under Wis. Stat. section 51.15(2).

SUMMARY: The emergency detention statute in Wisconsin’s Mental Health Act sets out a statewide process for providing, on an emergency basis, treatment to individuals who are mentally ill, drug dependent, or developmentally disabled and who meet certain other criteria set out in the statute. Wis. Stat. § 51.15(1) (2015-16).  Under Wis. Stat. section 51.15(2), local law enforcement officers can transport an individual for emergency detention and treatment to only two types of facilities: “a treatment facility approved by the [DHS] or the county department [of community programs], if the facility agrees to detain the individual, or a state treatment facility” (emphasis added).

[Editors’ Note: Both parties explained at oral argument in this case that, “in practice, if no local approved ‘treatment facility’ under Wis. Stat. § 51.15(2) is available to accept custody of an individual transported for emergency detention and treatment, a ‘state treatment facility’ ‘stands as a backstop’ or ‘facility of last resort’” (¶ 17).]

The DHS has designated the Winnebago Mental Health Institute in Oshkosh as the state treatment facility that will accept custody of individuals transported for emergency detention and treatment under the statute. In this action for declaratory and injunctive relief, the city of Madison contended that, under the statute, the DHS must also accept custody of individuals transported for emergency detention and treatment at the Mendota Mental Health Institute in Madison because Mendota is also a “state treatment facility” as that term is used in Wis. Stat. section 51.15(2).

The circuit court dismissed the city’s complaint on cross-motions for summary judgment, concluding that the DHS has not exceeded its authority under the statute because it has made at least one state treatment facility (Winnebago) available to accept custody of individuals transported for emergency detention and treatment under Wis. Stat. section 51.15(2).

In a decision authored by Judge Kloppenburg, the court of appeals affirmed. Although the Wisconsin Statutes identify six different institutions as “state treatment facilities,” the court held that the statute does not require the DHS to accept emergency detention and treatment cases at all of these state treatment facilities (¶ 23).

It concluded that “the legislature intended in Wis. Stat. § 51.15(2), read in the context of related statutes, to allow the Department to designate which state treatment facilities will accept custody of individuals transported for emergency detention and treatment under that statute, so long as the Department designates at least one of those facilities for these purposes…. Because Winnebago is by definition ‘a state treatment facility,’ see Wis. Stat. §§ 51.01(12) and (15) and 46.03(1), the Department has complied with the statute by making ‘a state treatment facility,’ namely Winnebago, available to accept custody of an individual transported for emergency detention and treatment” (¶ 34).