Pro
The Bench Bar Committee proposal removes guesswork as to what
claims are mandatory counterclaims and provides finality and equity by
ensuring certain claims are litigated when they should be.
By
Donald Leo Bach
Suppose you have a client who has just been sued in circuit court.
The client advises you that she has a claim against the suing party. As
a good lawyer you do what you were taught in law school, go to the
statute book, find the one on counterclaims - section 802.07 - and read
it. The statute tells you that a defendant "may counterclaim
any claim which the defendant has against a plaintiff." You conclude
that in Wisconsin counterclaims are permissive, and you advise the
client that she does not have to bring a counterclaim in this lawsuit if
she does not wish to do so.
But wait. Have you read A.B.C.G. Enterprises Inc. v. First Bank
Southeast N.A., 184 Wis. 2d 465, 515 N.W.2d 904 (1994)? In that
case, the Wisconsin Supreme Court held that the principles of res
judicata (claim preclusion) preclude a defendant who could but did not
counterclaim in a prior action from bringing a later action on the claim
if it "would nullify the initial judgment" or "impair rights established
in the initial action."
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Con
The Bench Bar Committee proposal encourages too many claims,
doesn't allow enough time for meaningful investigation, and has
far-reaching ethical implications.
By
Merrick R. Domnitz & Michael L. Eckert
The public perceives that lawyers file too many "frivolous claims" in
civil courts throughout the country, including Wisconsin. The passage of
the mandatory counterclaim statute may well be a step towards making
this perception a reality for parties in civil litigation.
Section 802.05(1)(a) of the Wisconsin Statutes requires that all
claims, including counterclaims, be well-grounded in fact and warranted
by existing law. There is no statute that currently mandates the filing
of a counterclaim in a party's responsive pleading. Consequently, there
is no time limit, other than the statute of limitations, on a party's
ability to conduct an investigation of the facts and law underlying a
potential counterclaim. Because existing procedural rules are structured
to encourage full investigation, they discourage the pursuit of
frivolous counterclaims. Adoption of the proposed mandatory counterclaim
statute will likely achieve the opposite result.
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