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2009

Supreme Court accepts five new cases

Madison, Wisconsin - April 27, 2009

The Wisconsin Supreme Court has voted to accept five new cases. The Court also acted to deny review in a number of cases. The case numbers, issues, and counties of origin are listed below. Court of Appeals’ opinions/certification memos available online for the newly accepted cases are hyperlinked.

2007AP1253 Brunton v. Nuvell Credit Corp.
This case examines jurisdictional issues arising from a car loan. More specifically, the Supreme Court has been asked to review when a defendant is deemed to have waived a challenge of improper venue under Wis. Stat. § 431.401 – the Wisconsin Consumer Act’s venue provision.

Some background: In 2003, Denice Brunton bought a new car from Hesser Oldsmobile, Inc. Both Brunton and the dealership are in Rock County. Brunton and Hesser executed a monthly installment contract, which Nuvell Credit Corp. later purchased. In late 2005, Brunton fell behind in monthly payments to Nuvell. In November 2005, Nuvell began trying to collect the debt. Brunton felt Nuvell’s collection practices were improper.

In December 2005, Brunton filed a lawsuit against Nuvell in Dane County Circuit Court. The lawsuit alleged that Nuvell violated various provisions of the Wisconsin Consumer Act (WCA). In February 2006, Nuvell filed a Notice of Appearance and an Answer denying Brunton’s allegations. Over the next year, the parties litigated the dispute, engaging in discovery and making several court appearances.

In February 2007, Nuvell filed a motion for summary judgment asserting the court should dismiss the action for lack of jurisdiction on the theory that pursuant to the terms of the statute, the action was improperly venued in Dane County. Brunton responded that Nuvell had waived any challenge to venue by litigating the action for more than a year. The circuit court granted Nuvell’s motion for summary judgment. Brunton appealed and the Court of Appeals reversed.

Brunton has conceded that Dane County was not a proper venue for her action under § 421.401. The parties further agree that § 421.401 (2) provides that a party who appears in an action brought under the WCA may waive an objection to improper venue. The question is when and how is improper venue waived?

The Court of Appeals then concluded that Nuvell “appear[ed] and waive[d]” its objection to improper venue within the meaning of Wis. Stat. § 421.401(2) “at some point prior to filing its venue challenge.” From Dane County.

2008AP10 Solowicz v. Forward Geneva National
This dispute involves three condominium owners in Geneva National, a master-planned community near Lake Geneva and various entities associated with its development. The Supreme Court has been asked to review several issues related to restrictive covenants and possible conflicts among covenants, case law and the state’s Condominium Ownership Act, Wis. Stat. ch. 703.

More specifically, the condominium unit owners have asked the court to review:

  • Whether the Restrictive Covenant must be reasonable to be enforceable;
  • Whether the Restrictive Covenant, which governs a master planned community that includes condominiums, is subject to under ch. 703;
  • Whether the Restrictive Covenant is ambiguous; and
  • Whether the Restrictive Covenant, which may be unlimited in scope and duration, is reasonable.

Some background: Geneva National is a 1,600 acre private development of golf courses, clubs, private roadways and utilities, single- and multi-family residences, including 32 condominiums, and commercial uses. The petitioners point out it is, in effect, "a community of condominiums." The three condominium owners sought a declaratory judgment to invalidate the restrictive covenant forming Geneva National’s governing structure.

The condominium owners contend the restrictive covenant is unenforceable because it grants the developer too much control, contrary to the act. They also claim the restrictive covenant is ambiguous, unreasonable, against public policy and void. The condominium owners argue the developer could unilaterally exercise its powers and perpetually control the majority of the association’s board through its own four votes and its power to remove or appoint any other officer on the board. The condominium owners also contend that the association and the trust were mere figureheads, and that the developer controls the community and assesses unit owners without recourse.

The circuit court dismissed their complaint, finding that the covenant was clear and specific, and therefore not subject to a separate reasonableness evaluation. The circuit court also determined that because the Restrictive Covenant is not a condominium instrument, it is not subject to ch. 703.

The Court of Appeals affirmed, observing that Geneva National was not a condominium, but a “private quasi-town.” Key to its decision was that the petitioners' complaints related to the community as whole, that is, how the master plan, rather than the individual condominiums, was being developed. The Court of Appeals concluded the covenant lacks the statutory requisites necessary to comprise a condominium instrument within the meaning of ch. 703.

The condominium owners contend the covenant conflicts with ch. 703, which would require a developer to develop the property within three years, or ten years, if it is expandable, and that both time limits long passed. The developers contended before the Court of Appeals that Geneva National is a master-planned community, not a condominium venture and that it sees vast differences between condominiums and master-planned communities.

The developers explained that master-planned communities present a complex development method, distinct from condominiums, requiring the developer to retain control so that it may react to varying market and government conditions in seeing its vision through and its investment secured.

A decision by the Supreme Court could clarify law in this area. From Walworth County.

2008AP912 Bank Mutual v. S.J. Boyer Const.
This commercial mortgage foreclosure proceeding examines whether a bank's waiver of a deficiency judgment against the mortgage debtor by virtue of the shortened redemption provisions in Wis. Stat. § 846.103(2) also eliminates the liability of a separate guarantor, if any deficiency remains of the mortgage debt.

Some background: Steven and Marcy Boyer appealed a circuit court order denying motions for relief from judgments rendered against them in foreclosure action. The Boyers were guarantors of about $1.1 million debt owed by S.J. Boyer Construction, Inc., to Bank Mutual under loans made during 2003 and 2004. Boyer Construction defaulted on the loans, which were secured by mortgages on property later sold to the bank at auction.

The circuit court concluded that the total amount due from the defendants was $1,436,457.85, excluding attorney fees and expenses. Separate judgments for that amount were entered against Steven and Marcy Boyer. A foreclosure judgment was also entered. On Sept. 19, 2007, the mortgaged real estate was sold at a sheriff’s sale. Bank Mutual was the only bidder and purchased all the mortgaged property for $1,180,000.

The circuit court overruled an objection to the confirmation of sale, concluding the deficiency issue should have been raised previously as objections to the findings of fact, conclusions of law, and judgments. The court also concluded § 846.103(2) did not prohibit judgment against Steven Boyer because the guaranty was a separate contract. For the same reasons, the court also denied Boyer Construction and Steven Boyer’s motion for relief from the judgment. The Boyers appealed, contending that Bank Mutual was prohibited from obtaining judgments against the Boyers for the full amounts of the debts because the bank elected a shortened redemption under § 846.103(2).

The Court of Appeals agreed with the Boyers and reversed the circuit court. The Court of Appeals held that under § 846.103(2), because the Boyers were personally liable by virtue of the guarantee they executed, the bank was precluded from proceeding against them to seek a deficiency judgment.

Bank Mutual argues the effect of the Court of Appeals' decision is to deprive commercial lenders of their right to elect a shorter redemption period because in doing so they forfeit rights against any guarantor. The bank says it did not obtain a deficiency judgment against the Boyers. Rather, it obtained a separate money judgment under the terms of their guarantees. The Court of Appeals’ decision also conflicts with prior appellate court decisions, the bank contends.

Specifically, Bank Mutual asks the Supreme Court to review two issues:

  • Does a commercial mortgage holder's exercise of the right to obtain a shortened redemption period under § 846.103(2) require it to forfeit rights against a guarantor of payment because the guarantor is a "... party who is personally liable for the debts secured by the mortgage..." under the statute?
  • Can a guarantor of payment contractually waive an objection to, and consent to, a mortgage holder's election under § 846.103(2) such that all rights against the guarantor are retained?

A decision by the Supreme Court could clarify law affecting mortgage foreclosure procedures statewide. From Brown County.

2007AP1868 Johnson Controls v. London Market
This certification is the latest in a dispute over insurance coverage in an ongoing lawsuit which has already spawned two prior appeals. The Supreme Court has been asked to examine issues involving excess umbrella insurance coverage on a business and whether certain policies include a duty to defend the insured under circumstances presented.

Some background from the Court of Appeals: Johnson Controls has been involved in years of litigation with multiple insurers over coverage for the potential costs associated with cleaning up environmental pollution at numerous sites covered by various policies. Johnson Controls has now settled with a number of the insurers involved in the litigation, including with one insurer for less than the full policy amount, but continues to seek coverage and a defense from an excess umbrella insurer. The present appeal deals only with whether London Market has a duty to defend Johnson Controls under the terms of its excess umbrella liability policy. The facts necessary to resolve the appeal are undisputed and center on the policy language.

The certification from the Court of Appeals raises two primary questions:

  • Should a duty to defend be imported from an underlying umbrella insurance policy into an excess umbrella liability policy by language in the excess policy stating that it is subject to the same terms, definitions, exclusions and conditions as the underlying policy “except as otherwise provided”? The excess policy explicitly promises indemnification for certain liabilities but makes no mention of a duty to defend other than as noted above.
  • Is the excess liability carrier’s duty to defend primary in nature, such that it may be triggered even if the excess policy expressly requires exhaustion of the underlying policy as a precondition to liability and the underlying policy has not been exhausted?

A decision by the Supreme Court could develop law in this area and affect both insurers that provide excess umbrella policies and the individuals or businesses that purchase such policies. From Milwaukee County.

2006AP948 Darnell Jackson v. Daniel Buchler and Matthew Frank
This case stems from a prison disciplinary action resulting from a riot at the New Lisbon Correctional Institute (NLCI) on Nov. 11, 2004.

Some background: Darnell Jackson was found guilty of inciting the riot, which resulted in injuries to several correctional staff members.

According to written statements provided by two confidential informants, the informants saw Jackson huddle with three inmates in a hallway at the NLCI. One of the informants stated that Jackson told the other three inmates that they knew what needed to be done. Jackson was allegedly a high-ranking member of the Vice Lords gang and was instructing other gang members to assault security officers in retaliation for a beating that those officers had inflicted on another gang member.

Shortly after Jackson was seen huddling with the other inmates, those inmates were seen attacking four security officers near their desk in the relevant unit of the prison. Jackson was not alleged to have participated directly in the riot as he went back into the prison barber shop where he was giving someone a haircut. Prison officials lodged a conduct report against Jackson, charging him with inciting a riot, contrary to Wis. Admin. Code § DOC 303.18, and group resistance and petitions, contrary to Wis. Admin. Code § DOC 303.20. Jackson contended that he never met with or directed the individuals who participated in the riot.

Among the evidence that was provided to the disciplinary committee were statements by various inmates, statements given by the two confidential informants, a conduct report by a Department of Corrections (DOC) officer assigned to gang activity, and other incident reports. Although the disciplinary committee's decision initially indicated that it had also reviewed and relied on videotape evidence, the reference to videotapes was subsequently removed after Jackson appealed.

On certiorari review in the circuit court, Jackson argued that prison officials should have produced a surveillance videotape of the area where he had allegedly met with the other inmates prior to the riot. The circuit court rejected as moot Jackson's arguments concerning the suppression of the videotape because the record then reflected that the disciplinary committee had not considered any videotape. The circuit court also rejected Jackson's claim that a lieutenant involved in the investigation should have been barred from serving on the disciplinary committee.

The Court of Appeals determined that there was no attempt by Jackson to argue the lieutenant’s involvement in the investigation had been substantial and that Jackson had not proven that he was legally entitled to obtain videotape evidence from prison officials.

The Supreme Court has been asked to review several issues:

  • Did the inclusion on a prison disciplinary committee of a prison official who briefly interviewed Jackson regarding the riot violate Jackson's right to a fair and impartial decision maker?
  • Did Jackson exhaust his administrative remedies regarding the production of a surveillance videotape, and may the Supreme Court review the issue even if he failed to exhaust his administrative remedies?
  • Does the obligation of governmental authorities to produce exculpatory information under Brady v. Maryland, 373 U.S. 83 (1963), apply to prison disciplinary proceedings? If so, what should be the process to determine if the information is exculpatory and what should be the remedy for failure to produce it?
  • Was there sufficient evidence to support Jackson's violation of a prison regulation?

From Dane County.

Review denied: The Supreme Court denied review in the following cases. Supreme Court review is a matter of judicial discretion, not of right, and will be granted only when special and important reasons are presented. As the state’s law-developing court, the Supreme Court exercises its discretion to consider for review only those cases that fit certain criteria, but these criteria neither control nor fully measure the Court’s discretion (see Wis. Stat. (rule) § 809.62).

Barron
2008AP301-CR State v. Duke

Bayfield
2008AP3173-CR State v. Gordon

Brown
2008AP1245 Co. of Brown v. Keuken
2008AP2062 Brown Co. DHS v. Janice W. 2
009AP359/60-W Kilaab al Ghashiyah v. Huibregtse - Justice N. Patrick Crooks did not participate.

Clark
2008AP626-CRNM State v. Holz

Dane
2007AP1054 Robinson v. Schneiter
2007AP2961 Heimermann v. McCaughtry
2008AP364-66-CR State v. Reveles
2008AP1438 Wis. Builders Ass’n v. DOC - Justice Patience Drake Roggensack dissents.
2008AP1974 DHS v. Jasmine D.
2009AP195-W Swiggum v. Mahoney

Fond du Lac
2008AP1929-CRNM State v. Pflum

Kenosha
2008AP1268-CR State v. Jones

La Crosse
2007AP1581-CRNM State v. Drusch
2008AP177-CR State v. Bolstad

Lincoln
2009AP515-W Rady v. City of Merrill

Marathon
2008AP3126/27-CR State v. Jacobs - Justice Ann Walsh Bradley did not participate.

Milwaukee
2006AP1646 Calvert v. State
2007AP1903-CRNM State v. Gurley
2007AP2152/53-CRNM State v. Lewis
2007AP2587-CR State v. Smith
2007AP2691-CRNM State v. Holliman
2007AP2772-CRNM State v. Lee
2007AP2873 City of Milwaukee v. NL Industries - Chief Justice Shirley S. Abrahamson dissents. Justice Patience Drake Roggensack did not participate.
2008AP5-CR State v. Lopez
2008AP153 State v. Mitchell
2008AP435-CR State v. Kennedy
2008AP609 State v. Evans
2008AP634 State v. Burnley
2008AP869 Forbes v. DHFS
2008AP887 State v. Morgan-Owens - Justice David T. Prosser, Jr. did not participate.
2008AP1335 State v. Rice

Ozaukee
2007AP2944-CR State v. Forbes

Racine
2008AP53 Becker v. Crispell-Snyder
2008AP67-CR State v. Jackson

Rock
2008AP367-CR State v. Jobson
2008AP370 State v. Sanders

Sauk
2007AP2628-CR State v. Wilk - Chief Justice Shirley S. Abrahamson and Justice Ann Walsh Bradley dissent.

Sheboygan
2007AP2782-CR State v. Baez

Vilas
2008AP1839/40-FT Town of Manitowish Waters v. Malouf

Walworth
2007AP1982-CR State v. Prineas

Waukesha
2007AP2582 Estate of Reif v. Automotive & Truck Svcs. - Justice Patience Drake Roggensack and Justice Annette Kingsland Ziegler dissent.
2007AP2847-CR State v. Hoak

Winnebago
2007AP2508-CR State v. Sturdivant

Wood
2007AP2960 State v. Meddaugh

Contact:
Tom Sheehan
Court Information Officer
(608) 261-6640

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