Civil Procedure

Claim Preclusion – Barred Claims

Teske v. Wilson Mut. Ins. Co., 2019 WI 62 (filed 4 June 2019)

HOLDING: Most claims raised in this lawsuit were barred by claim preclusion.

SUMMARY: This case arose out of a collision in 2013, in which four members of the Teske family were injured. An initial lawsuit resulted in an elaborate settlement (explained in the opinion). The first lawsuit was filed against the driver of the car that rear-ended the Teskes’ vehicle and that driver’s insurer. Each Teske family member received some compensation pursuant to the settlement.

A second lawsuit, at issue here, was brought against Wilson Mutual Insurance Co., the auto insurer of Emily Teske, the driver of the Teskes’ vehicle. The plaintiffs were Emily’s parents and her two sisters; Emily’s mother and sisters were in the car when the collision occurred but her father was not. The circuit court granted summary judgment in favor of Wilson Mutual on grounds of claim preclusion. In an unpublished decision, the court of appeals reversed.

The Wisconsin Supreme Court affirmed in part and reversed in part in an opinion authored by Justice A.W. Bradley. Claim preclusion barred the claims brought by Emily’s mother and sisters. The supreme court split evenly as to the claim brought by Emily’s father, which meant that his claim could go forward, as determined by the court of appeals.

The court reviewed the doctrine of claim preclusion. “Three elements are required to establish the application of claim preclusion to bar an action: (1) an identity between the parties or their privies in the prior and present lawsuits; (2) an identity of the causes of action in the two lawsuits; and (3) a final judgment on the merits in a court of competent jurisdiction” (¶ 25). As to the first element, the court unanimously agreed that there was identity of parties as to all parties in the second lawsuit except for the father; accordingly, it affirmed the court of appeals as to the father’s claim.

Addressing the remaining claims by Emily’s mother and sisters, the court held that the second and third elements were present. The alleged negligence by Emily and the other driver arose from the same accident and could have been litigated together (see ¶ 40). Finally, the first lawsuit had litigated the application of Wilson Mutual’s reducing clause. “Such a final judgment has preclusive effect on all matters ‘which were litigated or which might have been litigated in the former proceedings’” (¶ 43).

Justice Abrahamson did not participate in this case.

Criminal Law

Burglary – Elements

United States v. Franklin, 2019 WI 64 (filed 6 June 2019)

HOLDING: The locational alternatives in Wis. Stat. section 943.10(1m)(a)-(f) identify alternative means of committing one element of the crime of burglary under the statute, so a unanimous finding of guilt beyond a reasonable doubt as to subsections (a)-(f) is not necessary to convict.

SUMMARY: This case was before the supreme court on a certified question from the U.S. Court of Appeals for the Seventh Circuit. The certified question was as follows: “Whether the different location subsections of the Wisconsin burglary statute, Wis. Stat. § 943.10(1m)(a)-(f), identify alternative elements of burglary, one of which a jury must unanimously find beyond a reasonable doubt to convict, or whether they identify alternative means of committing burglary, for which a unanimous finding beyond a reasonable doubt is not necessary to convict?” (¶ 1). The Seventh Circuit certified this question to assist it in determining whether the defendants’ prior burglary convictions in Wisconsin count as predicate violent felonies for purposes of applying the federal Armed Career Criminal Act penalty enhancement. See 18 U.S.C. § 924(e)(1).

Wisconsin Statutes section 943.10(1m) provides that it is a Class F felony to intentionally enter any of the following places without the consent of the person in lawful possession of the place and with the intent to steal or commit a felony inside the place: any building or dwelling, an enclosed railroad car, an enclosed portion of any ship or vessel, a locked enclosed cargo portion of a truck or trailer home (whether or not any person is living in any such home), or a room within any of the above locations. The focus of the certified question was on these various locational alternatives, which are codified in Wis. Stat. section 943.10(1m)(a)-(f).

To answer the certified question, the supreme court looked to the four factors articulated in State v. Derango, 2000 WI 89, 236 Wis. 2d 721, 613 N.W.2d 833: 1) the statutory text, 2) the legislative history and context of the statute, 3) the nature of the conduct, and 4) the appropriateness of multiple punishments (see ¶ 4). Using this analysis the court, in a majority opinion authored by Justice Dallet, determined that Wis. Stat. section 943.10(1m) “creates one offense with multiple means of commission. Burglary can be broken down into the following elements: intentional entry, without consent, and with intent to steal or commit a felony. Subsections (a)-(f) list ‘any of the following places’ of entry and thus provide[] the means of commission for the element of entry. The crime is the act of the burglarious entry into one of the listed locations, regardless of which particular location is entered” (¶ 10).

Thus, the court concluded that “the locational alternatives in Wis. Stat. § 943.10(1m)(a)-(f) identify alternative means of committing one element of the crime of burglary under § 943.10(1m). Accordingly, a unanimous finding of guilt beyond a reasonable doubt as to subsections (a)-(f) is not necessary to convict” (¶ 20).

Justice Abrahamson filed a concurring opinion.

Criminal Procedure

Guilty-plea Hearings – Judicial Colloquy with Defendant Regarding Waiver of Constitutional Rights

State v. Pegeese, 2019 WI 60 (filed 31 May 2019)

HOLDING: Although the circuit court did not individually recite and specifically address each constitutional right the defendant was waiving when he entered a guilty plea, the plea colloquy proceedings as a whole reflect that the defendant understood the rights he was giving up.

SUMMARY: Before accepting a guilty plea in this case, the circuit court asked the defendant if he had read and completed the “Plea Questionnaire/Waiver of Rights” form (Circuit Court Form CR-227 which, among other things, specifically lists the constitutional rights that are waived by pleading guilty). The court also asked the defendant if he understood the entirety of the form and if he had any questions about the form. The defendant responded that he had read and completed the form, he understood all of it, and he had no questions.

The judge then asked defense counsel if he reviewed the form with the defendant and if he believed the defendant understood the form’s contents. Counsel replied affirmatively to both questions. The judge then directly asked the defendant, “[D]o you understand the constitutional rights you give up when you enter a plea today?” The defendant responded affirmatively. The court then followed up by asking if the defendant had “[a]ny questions about those rights.” The defendant responded that he had no questions. The court did not personally explain each of the rights the defendant was waiving during the plea colloquy. The court ultimately accepted the guilty plea and convicted the defendant.

The defendant thereafter sought to withdraw his plea, claiming that the plea colloquy was constitutionally deficient because the circuit court failed to properly ensure on the record that he fully understood all the constitutional rights that he was waiving by entering a guilty plea. The circuit court denied the motion without a hearing. In an unpublished decision, the court of appeals affirmed. In a majority opinion authored by Justice Ziegler, the supreme court affirmed the court of appeals.

Among the circuit court’s duties at a guilty plea hearing is to engage in a colloquy with the defendant to inform the defendant of the constitutional rights he or she waives by entering a plea and verify that the defendant understands he or she is giving up these rights (see ¶ 23). See State v. Taylor¸ 2013 WI 34, 347 Wis. 2d 30, 829 N.W.2d 482; State v. Brown, 2006 WI 100, 293 Wis. 2d 594, 716 N.W.2d 906.

While a waiver of rights form (for example, CR-227) may be used for this purpose, circuit courts are not to rely entirely on the form in a plea colloquy (see ¶ 33). “A plea questionnaire is indeed a useful tool to supplement a plea colloquy, but it alone does not replace a colloquy during which the circuit court must determine whether a plea is being made knowingly, intelligently, and voluntarily.”

In this case the court concluded that the colloquy with the defendant was not defective (see ¶ 37). “Although the circuit court did not individually recite and specifically address each constitutional right on the record, the plea colloquy proceedings as a whole reflect that [the defendant] understood the constitutional rights he was waiving” (¶ 40).

The supreme court declined to exercise its superintending authority to require that, at a plea hearing, circuit courts individually recite and specifically address each constitutional right being waived and then verify the defendant’s understanding of each constitutional right being waived (see ¶ 44).

Justice Dallet and Justice A.W. Bradley concurred, urging the court to exercise its superintending authority and prospectively require circuit courts to advise a defendant of each constitutional right being waived by pleading guilty (see ¶ 46). Justice Abrahamson withdrew from participation in this case.

Jury Instructions – Wis. J.I.-Criminal 140 Does Not Unconstitutionally Reduce State’s Burden to Prove Guilt Beyond a Reasonable Doubt

State v. Trammell, 2019 WI 59 (filed 31 May 2019)

HOLDING: Wisconsin’s standard “burden of proof” jury instruction (Wis. J.I.-Criminal 140) does not unconstitutionally reduce the state’s burden of proof below the reasonable-doubt standard.

SUMMARY: At the conclusion of the defendant’s trial, the court gave the standard burden-of-proof jury instruction – Wis. J.I.-Criminal 140. The defendant had requested this instruction and made no objection to it. After conviction he sought postconviction relief, claiming that Wis. J.I.-Criminal 140 misstated the law, confused the jurors, and caused him to be convicted based on a burden of proof lower than the constitutionally required “beyond a reasonable doubt” standard. He supported his motion with two law review articles, written by the same authors, that were based on separate but similar studies conducted by the authors.

The circuit court denied the motion. In an unpublished decision, the court of appeals affirmed. In a majority opinion authored by Justice Ziegler, the supreme court affirmed the court of appeals.

The supreme court began the opinion by examining whether the defendant had waived his right to object to the standard burden-of-proof instruction by failing to object to its use at his trial. It concluded that he had (see ¶ 24). Wisconsin Statutes section 805.13(3) provides that a failure to object at the jury instruction conference constitutes a waiver of any error in the proposed instructions. Nonetheless, the supreme court decided to exercise its discretionary power of review to consider the constitutionality of Wis. J.I.-Criminal 140.

Wis. J.I.-Criminal 140 informs the jury about the presumption of innocence and then goes on to explain that before the jury can return a verdict of guilty, the evidence must satisfy the jury beyond a reasonable doubt that the defendant is guilty. The jury is told that if it can reconcile the evidence upon any reasonable hypothesis of innocence, it should do so and return a verdict of not guilty.

The remainder of the instruction defines the reasonable-doubt standard. It informs the jury that the term “reasonable doubt” means a doubt based upon reason and common sense. With respect to other challenges raised by the defendant in this case, the instruction also includes language 1) describing reasonable doubt as a doubt that would cause a person of ordinary prudence to pause or hesitate when called upon to act in the most important affairs of life, 2) informing the jury that a doubt arising merely from sympathy or fear to return a verdict of guilt is not a reasonable doubt, and 3) instructing the jury that it is not to search for doubt but to search for the truth.

The court considered and rejected the challenges to each of the preceding components of the standard instruction. It also examined the instructions given to the jury as a whole. In the end it concluded that “Wis JI-Criminal 140 does not unconstitutionally reduce the State’s burden of proof below the reasonable doubt standard” (¶ 67).

The court declined the defendant’s invitation to overrule State v. Avila, 192 Wis. 2d 870, 532 N.W.2d 423 (1995), which held that Wis. J.I.-Criminal 140 as a whole emphasizes with great clarity the state’s burden and the presumption of the defendant’s innocence and does not dilute the state’s burden of proving guilt beyond a reasonable doubt (see ¶ 30).

Avila involved challenges similar to those raised by the defendant in this case, including his attack on the “search for the truth” language in the instruction, which was the focus of the law review articles referred to above. The authors of those articles opined that when jurors are instructed to “search for the truth,” significantly higher conviction rates result (¶ 12). The court declined to rely on these articles and, in a footnote, noted potential reliability concerns with the studies upon which the articles were based (see ¶ 34 n.11).

Finally, the court declined to exercise its power of discretionary reversal under Wis. Stat. section 751.06. “Since we conclude that Wis JI-Criminal 140 does not misstate the law, does not likely confuse the jury, and does not reduce the State’s burden, and as there is substantial evidence to support the jury’s verdict, we conclude that this is not an exceptional case warranting discretionary reversal under § 751.06” (¶ 60).

Justice Dallet filed a concurring opinion that was joined in by Justice A.W. Bradley.

Justice Abrahamson withdrew from participation in this case.

Habeas Corpus – Petition for Writ Need Not Allege Timeliness

State ex rel. Lopez-Quintero v. Dittmann, 2019 WI 58 (filed 29 May 2019)

HOLDING: The court of appeals may not deny a habeas petition ex parte on the ground that a petitioner failed to demonstrate that he or she sought relief in a prompt and speedy manner.

SUMMARY: In 2008, a jury convicted Lopez-Quintero (the petitioner) of first-degree intentional homicide and carrying a concealed weapon. In 2018, he filed a petition in the court of appeals for a writ of habeas corpus alleging that the lawyers who represented him in 2008 rendered ineffective assistance of counsel by failing to pursue postconviction relief despite his unequivocal expression of intent to pursue such relief. This failure caused the petitioner’s direct appeal rights to expire. The petition for habeas corpus sought reinstatement of his appeal rights. The petition omitted any reason for the petitioner’s failure to file his claim for habeas relief until almost a decade after his appeal rights had lapsed.

The court of appeals, in an unpublished order, denied Lopez-Quintero’s petition ex parte. Relying on State ex rel. Smalley v. Morgan, 211 Wis. 2d 795, 565 N.W.2d 805 (Ct. App. 1997) (per curiam), the court of appeals concluded that Lopez-Quintero failed to pursue habeas relief in a timely fashion. In a majority opinion authored by Justice R.G. Bradley, the supreme court reversed the court of appeals.

The sole issue before the supreme court was whether the court of appeals may deny a habeas petition ex parte for the petitioner’s failure to plead that his or her claim was brought in a timely manner. The supreme court concluded that it may not. Lopez-Quintero’s habeas petition was sufficiently pleaded in accordance with the statutory prescriptions. See Wis. Stat. § 809.51(1). The petition contained a statement of the legal issues and a sufficient statement of facts bearing on those legal issues, which if found to be true, would entitle Lopez-Quintero to relief (see ¶ 15). “The statute does not impose any deadline within which a petitioner must bring a habeas petition. In the absence of language imposing a time limit on filing a petition for the court of appeals to issue a writ of habeas corpus, we will not read one into the statute” (¶ 18).

Said the court: “While habeas relief may be denied under the well-established doctrine of laches if a petitioner unreasonably delays the filing of his petition, this case resolves whether the court of appeals may deny an otherwise sufficiently pled habeas petition ex parte, without a hearing or a response from the State, solely because the court of appeals deems it to be untimely. We hold that the court of appeals may not deny a habeas petition ex parte on the ground the petitioner failed to demonstrate he sought relief in a prompt and speedy manner. We overrule Smalley. Any equitable concerns regarding substantial delays, such as the near ten-year delay in the current case, are properly raised not sua sponte by the court of appeals but instead by the State asserting the defense of laches and establishing prejudice resulting from the delay” (¶ 10).

Justice Kelly filed a concurring opinion. Chief Justice Roggensack filed a dissent that was joined in by Justice Ziegler.

Confrontation – John Doe Investigations – Miranda

State v. Hanson, 2019 WI 63 (filed 5 June 2019)

HOLDING: Miranda warnings were not required when the defendant testified at a John Doe proceeding; use of the defendant’s John Doe testimony did not violate his right to confrontation.

SUMMARY: A murder case was cold from its occurrence in 1998 until 2009, when the defendant’s estranged wife cooperated with police. At a 2012 John Doe proceeding, the defendant testified and said things that incriminated him. “[A] John Doe judge [has] broad powers to determine the extent of the investigation and whether the investigation should be conducted in secret” (¶ 2 n.3). “In March 2013, the John Doe investigation was closed and the John Doe judge signed an order finding probable cause and authorizing the issuance of a criminal complaint” (¶ 7). A trial was held, and the jury convicted the defendant of the homicide. In an unpublished decision, the court of appeals affirmed.

The supreme court affirmed in an opinion authored by Justice Dallet. First, the prosecution’s use at trial of the defendant’s John Doe testimony did not violate his Sixth Amendment confrontation right even though it included related statements attributed to a detective and the defendant’s (now deceased) wife. Put differently, the defendant was questioned about what his wife may have said to a detective.

The opinion carefully dissected the multiple (three) layers of hearsay. The defendant’s own John Doe testimony was admissible as a party admission; the statements attributed to the detective and the defendant’s late wife were not admitted for their truth but to prove the defendant’s consciousness of guilt. As such, they were not testimonial hearsay and their use did not violate the confrontation clause. The court cautioned prosecutors that such nonhearsay use of third-party statements must be for legitimate purposes (see ¶ 26).

Second, the John Doe judge was not required to administer a complete set of Miranda warnings to the defendant before his John Doe testimony. Regardless of whether a defendant is in custody, the defendant’s testimony at a John Doe is not “custodial interrogation” as defined by Miranda (see ¶ 35). The court relied on federal case law that has long reached the same conclusion with respect to grand jury testimony. The court also underscored the statutory requirements of Wis. Stat. section 968.26 and the guidance provided to John Doe judges by the Wisconsin Judicial Benchbook – Criminal and Traffic and in Wis. J.I.-Criminal SM-12 (2011) (see ¶ 34).

Justice Abrahamson did not participate in this case.

Family Law

Grandparent Visitation Statute – Constitutional Validity – Burdens

Michels v. Lyons, 2019 WI 57 (filed 24 May 2019)

HOLDING: The grandparent visitation statute is facially constitutional but was unconstitutional as applied in this case.

SUMMARY: Over the objections of both “fit” parents, the circuit court granted a grandmother visitation rights to take her young granddaughter “to Disney World or other vacation.” The court of appeals certified the appeal to the supreme court to address the standard of proof required to overcome the presumption that “a fit parent’s visitation decision is in the child’s best interest.”

The supreme court, in an opinion authored by Justice Dallet, held that the grandparent visitation statute, Wis. Stat. section 767.43(3), is constitutional on its face but was unconstitutionally applied by the circuit court in this case (see ¶ 2). The parents have a “fundamental liberty interest” in the upbringing of their child such that the visitation statute, which directly and substantially implicates that interest, must withstand strict scrutiny (see ¶ 22). Applying strict-scrutiny analysis, the supreme court upheld the statute as facially valid. Specifically, it held “that the Grandparent Visitation Statute is narrowly tailored to further a compelling state interest because a grandparent must overcome the presumption in favor of a fit parent’s visitation decision with clear and convincing evidence that the decision is not in the child's best interest” (¶ 36).

The court also clarified the holdings in two earlier cases, Martin L. v. Julie R.L. (In the Interest of Nicholas L.), 2007 WI App 37, 299 Wis. 2d 768, 731 N.W.2d 288, and Roger D.H. v. Virginia O. (In re Paternity of Roger D.H.), 2002 WI App 35, 250 Wis. 2d 747, 641 N.W.2d 440: “We determine that a circuit court should consider the nature and extent of grandparent visitation only if a grandparent overcomes the presumption in favor of a fit parent’s visitation decision with clear and convincing evidence that the decision is not in the child’s best interest. A circuit court should not substitute its judgment for the judgment of a fit parent even if it disagrees with the parent’s decision” (¶ 37).

Turning to the record before it, the supreme court held that the child’s grandmother did not meet her burden to overcome the presumption, especially because the parents did not seek to eliminate the grandmother’s visitation with the child or deprive the two of a relationship (¶ 41).

In a concurring opinion, Justice R.G. Bradley, joined by Justice Kelly, joined the mandate reversing the circuit court but concluded that the statute was facially unconstitutional under strict-scrutiny analysis (see ¶ 44).

Insurance

“Commercial Crime” – Coverage

Leicht Transfer & Storage Co. v. Pallet Cent. Enters. Inc., 2019 WI 61 (filed 31 May 2019)

HOLDING: An insurance policy did not cover a forgery and fraud scheme by a supplier.

SUMMARY: Pallet Central Enterprises Inc. used allegedly forged delivery tickets as part of a scheme to fraudulently bill Leicht Transfer & Storage Co. for the sale and delivery of pallets that were never delivered. Leicht Transfer sought coverage under its commercial crime insurance policy issued by Hiscox Insurance Co. The insurer denied coverage; the circuit court and the court of appeals (in an unpublished decision) agreed that the policy did not cover the losses at issue.

The supreme court affirmed in an opinion authored by Justice Kelly. Essentially, Pallet Central’s bogus “delivery tickets” were not “written … directions to pay a sum certain in Money” within the language of the policy (¶ 7). The majority “esp[ied]” no ambiguity in the policy’s wording; the delivery tickets “contain no directions to pay” (¶ 13).

The court rejected Leicht’s contention that the delivery tickets functioned as a direction to pay. “We see nothing in the Policy, however, that grants coverage to documents not covered by its terms, but which are used as functional proxies for documents that are covered by its terms. So, when Leicht says ‘the delivery tickets functioned as a direction to make payment, just as the policies required,’ it is mistaken. The Policy required a direction to pay, not a stand in for a direction to pay” (¶ 17). Based on this conclusion, the court did not address other issues raised by Leicht as to the policy’s coverage.

Justice A.W. Bradley dissented based on “the parties’ habitual practices” and the case law (¶ 22). “[A] forged signed delivery ticket is a similar written promise, order or direction to pay a sum certain that was purported to have been made by Leicht’s agent” (¶ 45).

Mental Commitments

Wis. Stat. section 51.20 Recommitments – Challenge to Earlier Recommitment Order – Mootness

Portage Cty. v. J.W.K., 2019 WI 54 (filed 21 May 2019)

HOLDING: The respondent’s sufficiency-of-the-evidence challenge to an earlier mental recommitment order was moot because the earlier order expired after the circuit court extended the recommitment under a separate order.

SUMMARY: J.W.K. was originally committed in February 2016 for six months under Wis. Stat. section 51.20 (a provision of Wisconsin’s Mental Health Act). In July 2016, Portage County filed a petition seeking to extend J.W.K.’s commitment for 12 months. After a hearing, the circuit court granted the petition and extended the commitment until Aug. 2, 2017. J.W.K. did not timely appeal this first recommitment order; however, the court of appeals granted J.W.K. an extension, until April 24, 2017, to seek postcommitment relief.

On April 3, 2017, J.W.K.’s counsel filed a notice of intent to seek postcommitment relief and, on Aug. 7, 2017, filed a notice of appeal challenging the sufficiency of the evidence presented in support of the 2016 recommitment order. Meanwhile, with the 2016 extension order expiring on Aug. 2, 2017, the county filed a petition seeking another 12-month extension, which the circuit court granted after holding a hearing on July 21, 2017.

The court of appeals ordered J.W.K. to file a memorandum addressing whether his appeal of the August 2016 order was moot, given that he filed his notice of appeal after a new order extending his commitment had been entered in July 2017. After considering J.W.K.’s and the county’s submissions addressing mootness, the court of appeals dismissed the appeal as moot “because J.W.K. is no longer subject to the order being appealed” (¶ 8). In a majority opinion authored by Justice R.G. Bradley, the supreme court affirmed the court of appeals.

“An issue is moot when its resolution will have no practical effect on the underlying controversy” (¶ 1). In this case J.W.K. is no longer subject to the August 2016 recommitment order forming the basis for this appeal. That order lapsed when the court entered a new commitment order on July 21, 2017. J.W.K. did not allege any defects in the July 2017 recommitment order. This made J.W.K.’s challenge to the 2016 recommitment order moot (see ¶ 13).

The court rejected J.W.K.’s argument that a reversal of the 2016 recommitment order would necessarily invalidate all later extensions, creating a domino effect voiding subsequent recommitment orders. Said the court: “J.W.K.’s domino theory that each extension depends on the validity of previous commitment orders is not supported by the text of the statute…. As long as the extension is made prior to the expiration of the previous commitment order, the circuit court may order the extension if the County proves its case under the statutory criteria. Each order must independently be based on current, dual findings of mental illness and dangerousness; accordingly, the sufficiency of the evidence supporting prior orders has no impact on any subsequent order” (¶ 21) (citations omitted).

Justice Dallet filed an opinion concurring in part and dissenting in part that was joined in by Justice Abrahamson and Justice A.W. Bradley.

Municipal Law

Authority of Counties to Establish Rural Naming and Numbering System in Towns – Meaning of “Rural”

Town of Rib Mountain v. Marathon Cty., 2019 WI 50 (filed 16 May 2019)

HOLDING: Marathon County may establish a rural naming or numbering system in towns within the county; Wis. Stat. section 59.54(4) does not restrict this exercise of authority to only rural areas within the towns.

SUMMARY: In 1957 the Wisconsin Legislature conferred authority on counties to “establish a rural naming or numbering system in towns for the purpose of aiding in fire protection, emergency services, and civil defense.” Wis. Stat. § 59.54(4). Marathon County (the county) decided to establish such a system in 2016 by enacting an ordinance that would assign a unique address to each location in the county. The town of Rib Mountain (the town) was one of 40 towns required by the county to participate in the new addressing system. The town challenged the county’s authority to do so, contending the statute confines counties to implementing naming and numbering systems only within “rural” areas of towns. The town alleged that some areas within the town are not rural. The county responded that the only territorial restriction on its authority to establish a “rural naming or numbering system” is “in towns.”

The circuit court denied the town declaratory relief, and the town appealed its decision. In a published opinion, the court of appeals reversed the circuit court. See 2018 WI App 42. In a decision authored by Justice R.G. Bradley, the supreme court reversed the court of appeals.

The supreme court held, consistent with the text of the statute, that “Marathon County may establish a rural naming or numbering system in towns, and the statute does not restrict this exercise of authority to only rural areas within them. ‘Rural’ merely describes the naming or numbering system and the roads to which the system applies; it has no independent operative effect” (¶ 1). “Accordingly, Marathon County acted within its authority by enacting an ordinance to create a uniform naming and numbering system in towns throughout Marathon County” (¶ 24).

Justice Abrahamson and Justice A.W. Bradley did not participate in this decision.

Torts

Constructive Trust – A Remedy Only

Tikalsky v. Friedman, 2019 WI 56 (filed 23 May 2019)

HOLDING: A constructive trust is a remedy, not a cause of action, so the circuit court properly dismissed a defendant from this action.

SUMMARY: Donald and Betty Lou Tikalsky disinherited their son Steven Tikalsky and his family, leaving their estate to Steven Tikalsky’s siblings. Following his parents’ death, Tikalsky filed this action, which essentially alleged that his siblings had caused the estrangement between Tikalsky and his parents. The complaint alleged numerous claims, including one for a “constructive trust” against Tikalsky’s sister Terry Stevens, on which this opinion turns. Stevens sought dismissal on grounds that a “constructive trust” is a remedy, not a cause of action. The circuit court dismissed Stevens on summary judgment, but the court of appeals (in an unpublished decision) reversed.

The supreme court reversed the court of appeals in a majority opinion authored by Justice Kelly. “We hold that a constructive trust is a remedy, not a cause of action. We also hold that, under the proper circumstances, a constructive trust may be imposed on property in the possession of one who is wholly innocent of any inequitable conduct” (¶ 1).

The supreme court held there was no ground for keeping Stevens in the case. The majority opinion canvassed the purpose of constructive trusts, which is “to protect the beneficial owner against the legal owner” (¶ 18); they function “as a means of repairing divided ownership interests, not as a means of determining whether they are in need of repair” (¶ 19).

Conceding the case law had “not been entirely consistent,” the court clarified that a constructive trust is only a remedy, not a cause of action (see ¶ 22). Such trusts may be imposed in cases of unjust enrichment or when a defendant comes into possession of property already subject to such a trust (see ¶ 23).

On this record, neither one of those circumstances was present. Nor did this case fall within the “innocent beneficiary” doctrine (see ¶ 30). The majority opinion closed by separately addressing the dissents.

Justice Ziegler joined the majority opinion but wrote a concurrence to “further clarify” the issue before the court. “Constructive trust is not a stand-alone cause of action” (¶ 45). No “viable legal theory” was alleged against Stevens (¶ 46). A fitting analogy involves punitive damages, which require an award of compensatory damages as a predicate (see ¶ 55).

Chief Justice Roggensack dissented. She concluded that Tikalsky “has made a sufficient claim against [Stevens], which if proved would warrant the imposition of a constructive trust on some of the property she received from [her parents’ estate] for which claim [Stevens] did not make an evidentiary, prima facie case for dismissal, and for which [Tikalsky] provided sufficient evidentiary support to create material issues of fact” (¶ 6).

Justice A.W. Bradley, joined by Justice Abrahamson, also dissented. She agreed that a constructive trust is a remedy but contended that this case turns on an intentional-interference claim that entitled Tikalsky to pursue that remedy against Stevens (see ¶ 89). She declined to join the Chief Justice’s dissent because, “like the majority opinion, it appears to conflate the imposition of a constructive trust on [Stevens’] property with a claim against [Stevens] herself” (¶ 83).