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2009

Supreme Court accepts four new cases

Madison, Wisconsin - August 24, 2009

The Wisconsin Supreme Court has voted to accept four 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.

2008AP755-CR State v. Conger
This certification from the District II Court of Appeals (District IV Court of Appeals’ judges presiding) raises novel issues regarding circuit courts' supervisory role in accepting or rejecting plea agreements.

Some background: The defendant, Joshua Conger, was charged with possession with intent to deliver more than 200 grams but less than 1,000 grams of marijuana within 1,000 feet of a park, a Class H felony, and possession of drug paraphernalia. Police found 48 individually wrapped baggies of marijuana totaling 774 grams hidden behind a ceiling tile in the home the defendant shared with his girlfriend and a third person.

After the defendant was bound over for trial, the parties negotiated a plea agreement under which the felony count would be dropped in favor of the defendant pleading guilty or no contest to three misdemeanor counts of possession of marijuana (THC). The drug paraphernalia charge would be dismissed but available as a read in offense for sentencing. The state agreed to recommend two years probation, sentence withheld, conditioned in part on a 90-day jail term.

The trial court refused to accept the plea agreement based on the public interest. The court stated that based on all the facts of the case, including the large quantity of marijuana packaged for resale, the offense was too serious to be reduced to misdemeanors and that the public interest was best served by maintaining the case as a felony. The Court of Appeals granted the defendant's motion for leave to appeal. The state and the defendant are the co-appellants in the appeal, with the trial court, Judge Peter Grimm, the respondent.

The certification asks the Supreme Court to consider three questions:
-- What is the trial court's scope of review when deciding whether to accept or reject a plea agreement?
-- What factors must a trial court consider when determining whether a plea agreement is in the public interest?
-- Whether a trial court may take into account the view of law enforcement when considering the public's interest in a plea agreement?
From Fond du Lac County.

2007AP2861 Racine Co. v. Oracular Milwaukee
This case, involving the alleged breach of a contract to set up a software payroll database, examines the definition of “professional services” and whether expert testimony is required under certain circumstances.

Some background: In late 2003, Racine County sought bids to upgrade its then-current Peoplesoft World system to Peoplesoft One 8.0 and install the same release of Peoplesoft One Human Resources and Payroll modules.”

In February 2004, Racine County executed a consulting service agreement with Oracular Milwaukee. This Agreement incorporated, by reference, the County’s request for proposal and Oracular’s proposal.

The County terminated the contract with Oracular on February 16, 2006, and a lawsuit alleging that Oracular breached the consulting service agreement followed.

Oracular filed an answer and counterclaims for breach of contract and subsequently brought a motion for summary judgment, seeking dismissal of the claim. Oracular argued that the agreement was a professional services contract and the County could not prevail because it had not disclosed any expert witnesses on the standard of care owed by computer consultants. See Hoven v. Kelble, 79 Wis. 2d 444, 463, 256 N.W.2d 379 (1977), and Micro-Managers, Inc. v. Gregory, 147 Wis. 2d at 513.

The County responded that Hoven was factually distinguishable and that requiring expert testimony is required only when the jury is facing unusually complex or esoteric issues. The County pointed out that the agreement required the software to convert data and asserted that it would present fact witnesses who would testify that, when Oracular abandoned the project, the software did not convert data.

It notes that Oracular does not deny that the system was only 53 percent functioning when the contract was terminated – more than a year after the scheduled completion date. It asserts that evaluating whether there was a breach in this case was not beyond the realm of experience of the ordinary juror.

The trial court agreed with Oracular and granted the motion for summary judgment, dismissing the action. The circuit court held that this was a contract for services to install computer software and that expert testimony was required as a matter of law. The circuit court then denied the County’s motion for reconsideration, holding that the County’s failure to retain expert witnesses was the equivalent of a failure of proof and warranted a grant of summary judgment to Oracular.

The County appealed and the Court of Appeals reversed. The Court of Appeals ruled that Oracular “does not have the characteristics shared by the learned professions considered as professionals.” As such, its contract with the County was “a simple contract for services and not a professional services contract.” The Court of Appeals ruled further that expert testimony was not required.

Oracular asks the Supreme Court to review three questions:
-- Is expert testimony required to prove a branch of contract claim based on timely completion/delay when a contract involves complex interdependent bilateral performance?
-- What is the proper analysis/criteria for determining whether something is considered a “profession” under Wisconsin law?
-- Are persons providing computer software programming services relating to customized software considered “professionals” under Wisconsin law?
From Racine County.

2008AP787 Groshek v. Trewin
This case stems from a series of real estate transactions and loan agreements between a couple facing financial difficulties and an attorney who had at times represented them.

Some background: Some of the details are disputed, but Francis and Karen Groshek had owned real estate, including a home, land and sawmill, which they operated before being foreclosed on by F&M Bank. In March 2004, they filed for bankruptcy, and Michael G. Trewin was their attorney of record.

Trewin allegedly arranged a deal ostensibly to help the Grosheks stay in their home before his license to practice law was suspended on Aug. 31, 2004.

On Aug. 27, 2004, Trewin had written to the Grosheks, proposing that he buy their land “for enough money to pay off F&M Bank,” sell roughly forty acres to their neighbors, and give the Grosheks a lease on the remaining land for $1,300 per month with an option to purchase for $239,585, less the proceeds from the sale to the neighbors.

On August 30, 2004 – the day before Trewin’s license to practice law was suspended – the Grosheks executed a waiver of conflict of interest drafted by Trewin. At the same time, they executed an agreement with him that provided that he was to purchase from them the real estate on which F&M Bank held the mortgage “in return for a full release of any claim against [the Grosheks].” The agreement further provided that, after selling approximately forty acres to the neighbors, he was to lease the property back to the Grosheks according to the terms of an attached lease. Neither the Grosheks nor Trewin signed the attached lease at that time. At some point thereafter, a different attorney began to represent the Gresheks.

On November 26, 2004, the Grosheks executed and delivered to Trewin a deed to their home and thirty-four acres, having sold forty acres to their neighbors for $108,000. Trewin paid the Grosheks $94,500. That same day, the Grosheks and Trewin signed a five-year lease, effective December 1, 2004, with a monthly rent of $1,300 plus real estate taxes and insurance on the property. The lease contained an option to purchase for $127,500 between January 1, 2006, and the end of the lease term, provided all monthly rental payments were promptly made. Trewin canceled the lease in April 2006 for nonpayment of rent. The Grosheks remained living in the home for several months under an oral lease.

The Grosheks initiated an action claiming that Trewin had breached his fiduciary duty to them in various ways by entering into the transaction with them regarding their property. Terwin answered and filed a counterclaim seeking eviction and unpaid rent.

After a bench trial, Trewin was found to have breached his fiduciary duty to the Grosheks, whom he had represented through bankruptcy proceedings. The circuit court voided the contract and awarded $38,200 in punitive damages against Trewin. It also dismissed Trewin's counterclaim against the Grosheks for eviction and unpaid rent.

On appeal, the Court of Appeals affirmed in all respects, except it reversed the award of punitive damages.

Both parties have asked the Supreme Court to review the case.

In their petition for review, the Grosheks ask the Supreme Court to review whether punitive damages may be awarded to a plaintiff who sought and obtained “equitable relief.”

In the petition for cross-review, Trewin asks whether an attorney owes a fiduciary duty to former clients when negotiating and entering into a transaction with them, when they are represented by independent counsel, have sought out the transaction, and initiated negotiations.

Trewin argues that because the conveyance of the property and the lease execution did not occur until late December 2004, when the Grosheks were represented by another attorney, nothing transpired when he was representing them that could constitute a breach of his fiduciary duty. From Portage County.

2008AP1684 Milwaukee Symphony v. DOR
This sales tax case examines whether the term "entertainment," as used in Wis. Stat. § 77.52(2)(a)2, includes the admission to a symphonic event, such as a Milwaukee Symphony Orchestra ("MSO”) performance.

Some background: MSO is a professional, full-time orchestra incorporated as a not-for-profit corporation and presents 100 to 150 concerts each year. MSO filed an amended sales tax return, claiming a refund of $719,456.69 in sales tax that it had paid on its sales during 1992 through 1996. MSO stated that its symphony concerts were primarily educational or charitable and therefore not taxable under the statute.

MSO contends that because the Tax Appeals Commission ("the Commission") has previously excluded events at Circus World Museum and the experimental aircraft association from the definition of an "entertainment" event, the term should be narrowly construed to exclude a symphonic performance with a significant educational component.

The Tax Appeals Commission rejected the argument and determined that the concert performances were taxable.

The circuit court gave deference to the Commission's decision, while concluding that the Commission erred in distinguishing between education and entertainment because § 77.52(2)(a)2. does not use the term “educational” or “non-educational.” The circuit court remanded to the Commission to permit it to develop a standard to determine whether an event is "entertainment" within the meaning of § 77.52(2)(a)2.

MSO appealed and the Department cross-appealed.

The Court of Appeals affirmed the Commission's decision, determining that the Commission correctly and reasonably reconciled three previous cases involving questions surrounding sales taxes on certain types of organizations.

A decision by the Supreme Court could effect sales tax revenue and arts organizations statewide. 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
2008AP633-CR State v. Hegna
2008AP1524-CRNM State v. Quintero

Bayfield
2008AP1018-W Hipsher v. Lucci

Brown
2008AP405 State v. Neal
2008AP1624 State v. Gering

Burnett
2009AP1813-W McCormack v. Deppisch - Justice Michael J. Gableman did not participate.

Chippewa
2009AP383 Crystal L.S. v. Lutheran Soc. Serv.

Columbia
2008AP1366-W Smith v. Circ. Ct. for Columbia Co.

Dane
2007AP2856-CR State v. Romero
2008AP481-CR State v. Clayton
2008AP2138-CR State v. Luu
2008AP3018-CRNM State v. Pope

Green
2009AP1282-1432-W Smith v. Div. of Hearings and Appeals

Iowa
2008AP1437 Babcock v. State Farm

Kenosha
2008AP1290-CR State v. Stevenson
2008AP1737-CR State v. Taleronik
2008AP1911-CR State v. Wallace
2008AP1983-CR State v. Malone

La Crosse
2009AP1365-W Drusch v. COA

Langlade
2009AP788 Langlade Co. DSS v. Bobby M.
2009AP819-W Maus v. Cane

Milwaukee
1999AP1956-CR/ State v. Madden
2007AP184 2007XX1350 State v. James
2008AP541-CR State v. Sundermeyer
2008AP631-CRNM State v. Lemon
2008AP786-CR State v. Berggren
2008AP797-CR State v. Bullock
2008AP1083 State v. Myartt
2008AP1239-CR State v. Contreras
2008AP1430 Shelton v. Husz
2008AP1753 Est. of Jones v. Smith
2008AP1844-W Morris v. Pollard
2008AP2017-CR State v. Flynn
2008AP2114-W Rones v. Pollard
2008AP2924 Vill. of Hales Corners v. Larson
2008AP3114-CR State v. Morrison
2009AP1804-OA Smith v. Circ. Ct. Milw. Co.

Ozaukee
2008AP1192-CR State v. Komorowski

Racine
2008AP482-CR State v. Sandoval
2009AP649-W Famous v. Pollard

Waukesha
2008AP411 State v. Groenke
2008AP1590-W Pietila v. Pollard
2008AP2854/55 State v. Portillo

Waushara
2008AP307-CR State v. Pablo

Winnebago
2008AP2370-CR State v. Houle
2008AP2860-CRNM State v. Heiser

Wood
2008AP2123 Wis. DHS v. Wood Co.

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

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