Court of Appeals Upholds Verdict Question Asking Whether Blue Car Was “Comparable” to Red Car in Lemon Law Case

The limits of what constitutes a “comparable” replacement vehicle under Wisconsin’s Lemon Law have been put to the test, and the Court of Appeals recently rejected a plaintiff’s attempt to strike a jury’s finding that a 2012 Blue Ford Escape was a “comparable” replacement for a 2010 Red Ford Escape. See Porter v. Ford Motor Company, 2014AP975. Somewhat ironically, the appeals court relied heavily on Marquez v. Mercedes-Benz, USA, 2012 WI 57—a case in which the prevailing party was represented by the same attorneys who apparently sought to avoid its holding in representing the unsuccessful plaintiff-appellants in Porter v. Ford Motor Company.

In Porter, the Court of Appeals was asked to review the circuit court’s denial of motions after verdict regarding Ford’s allegedly “inconsistent defenses” and the jury’s decision about the color of the replacement vehicle. By way of background, the Porters purchased a 2010 Ford Escape with a red exterior and beige interior. Apparently, the Porters claimed that they would not have purchased a vehicle that was not red with a beige interior and explained that they “chose the red exterior because Mrs. Porter’s first car as a teenager was red” and “they chose the light-colored interior because dark interiors made Mr. Porter feel ‘very enclosed.’” ¶3.

After bringing the vehicle in for repairs several times between 2010 and 2012, the Porters sent Ford a Lemon Law notice under Wis. Stat. § 218.0171 seeking a comparable vehicle. Ford offered the Porters a 2012 Ford Escape but the Porters refused to accept the vehicle because it was blue with a dark interior. Instead of taking the brand new replacement vehicle, they sued Ford.

The case made it before a jury, which determined that although the 2010 Escape was a “lemon,” Ford complied with its duties under the Lemon Law when it provided the Porters with a comparable replacement. The jury’s verdict did not sit well with the Porters, who brought motions after verdict in which they argued that “a blue vehicle with a dark charcoal interior cannot be comparable to a red vehicle with a beige interior as a matter of law.”  ¶9 (emphasis added). The Porters also argued that Ford should not have been allowed to argue both that the vehicle was not a lemon and that even if it was, Ford satisfied its obligations under the law. The circuit court denied these motions, and the Porters appealed. Not surprisingly, it appears that one of the motives for the appeal was to obtain a ruling that would permit them to recover their attorney’s fees under the statute. See ¶23.

The Court of Appeals explained that based on the language of the statutes, § 218.0171(1)-(2), “a successful Lemon Law claim must prove, first, that the vehicle at issue was a ‘lemon,’ and, second, that the manufacturer failed to comply with the law’s provisions.” Thus, Ford’s arguments were hardly inconsistent—it raised defenses to both elements of claim. ¶19.

Just because a consumer is required to choose between a replacement or a refund does not mean that a manufacturer must in turn choose between arguing that a car is not a lemon or that, even if it is a lemon, that it did provide a comparable replacement for it.


The Porters also argued that, in essence, the jury’s role should have ended once it determined that the 2010 vehicle was a lemon. The Porters asserted that once that finding was made, the Porters were the prevailing party and the rest of the statutory language should just be ignored. According to the Porters, the verdict question regarding whether the 2012 vehicle was comparable “was a surplus question that was irrelevant under the law.” ¶23. The Court of Appeals did not mince words: “The Porters are wrong.” ¶24. Quoting at length from the Marquez decision, the court pointed out that “the Lemon Law was not created to punish manufacturers, but to get consumers back on the road in quality cars.” ¶25, citing Marquez, 2012 WI 57 at ¶29.

Claims-Made-And-Reported Insurance Policies Not Subject to Statutory Notice Requirements

In a decision I previously reported on, Anderson v. Aul, the Court of Appeals was asked to examine the reporting requirements of a claims-made-and-reported policy of insurance, which is a common type of policy in the context of errors and omissions and professional liability coverage. Claims-made-and-reported policies differ from “occurrence” policies, because occurrence policies generally provide coverage for injuries that “occur” during the policy period even if the claim for the resulting injury is not filed until after the policy expires. In contract, claims-made-and-reported policies contain two requirements to trigger coverage: 1) the claim must be made during the policy period; and 2) the insured must give written of the claim within the policy period.

The appellate court examined a claims-made professional liability policy written by Wisconsin Lawyers Mutual Insurance Company with a policy period of April 1, 2009 to April 1, 2010. However, WLMIC did not receive notice of the claim of malpractice against the insured attorney until March 9, 2011. Despite this delay and despite the language of the policy requiring notice to be made during the policy period, the appeals court held that a “finding of untimeliness is not solely dispositive” of the coverage question and that the circuit court must also determine whether the untimely notice prejudiced the insurer. In its published opinion, the Court of Appeals looked to the reasonableness standard set forth in Wisconsin statutes and held that unreasonably late notice is not per se prejudicial to an insurer. The appellate court’s decision was a blow to insurers who relied on the claims-made-and-reported type of policy to limit their exposure and to keep premiums low.

On review of the Court of Appeals’ decision, the Wisconsin Supreme Court reversed. The court noted that Wisconsin’s notice-prejudice statutes, Wis. Stat. §§ 631.81(1) and 632.26(2) provide that an insured’s failure to furnish timely notice of a claim as required by the terms of a liability policy will not bar coverage unless timely notice was “reasonably possible” and the insurance company was “prejudiced” by the delay. ¶ 4. However, the court held that these statutes do not supersede the policy’s notice requirements. ¶ 7.

Continue reading

Personal Knowledge Necessary to Establish Impermissible Purpose in Age Discrimination Claims

The Seventh Circuit recently reiterated the rule that admissible testimony must be based on personal knowledge in a case alleging age discrimination. See Widmore v. Sun Chemical Corporation, No. 13-2313 (7th Cir., Nov. 19, 2014). Being blamed for problems that were not your fault is not sufficient to establish that your employer was motivated by an impermissible purpose, and speculation as to the employer’s state of mind does not create a material factual dispute about whether the reason for termination was pretextual.

George Widmar worked for Sun Chemical Corporation as a Plant Manager for sixteen years. Sun Chemical terminated Widmar’s employment in 2009, claiming that the company was unsatisfied with Widmar’s performance. “The gist of his case is that Sun Chemical falsely blamed Widmar [for many of the problems involving its products] to cover up for the fact that it was firing him because of his age.”

However, the court was quick to note that, at first blush, this case did not seem as if it was appropriate for summary judgment disposition: “Generally, when the fact sections of the opposing briefs read like two unrelated stories, that is a clue for a court to look for material facts that require a trial to resolve. …That certainly seemed to be the case here.”

Although the two sides’ stories were dissimilar, the court could not simply end its analysis on a cursory review of the facts. The district court and the court of appeals examined the briefs and record carefully and found that much of the disagreement was created by deficiencies in Widmar’s recitation.

Widmar’s declaration and deposition were “not only self-serving, but also irrelevant in establishing that age was a motivating factor in his termination.” (R. 201, p. 6). Self-serving affidavits can indeed be a legitimate method of introducing facts on summary judgment.

Additionally, Widmar failed to comply with Federal Rule of Civil Procedure 56(e) and Federal Rule of Evidence 602, “both of which require that testimony be based on personal knowledge. Personal knowledge can include reasonable inferences, but it does not include speculating as to an employer’s state of mind, or other intuitions, hunches, or rumors.”

Continue reading

Whether Property is “Wholly Destroyed” is Determined Solely by Statutory Formula

The Court of Appeals recently confirmed that when determining whether a building cannot be repaired and is therefore wholly destroyed, application of the statutory formula in Wis. Stat. 66.0413 is conclusive. See  Haynes v. American Family Mutual Insurance Company, 2014AP000395. Tracy Haynes home burned down on May 29, 2012. The City of Milwaukee issued a Raze Order on July 10, 2012 stating that the home was “now unfit for human habitation, further occupancy or use, and is unreasonable to repair.”

American Family insured the home for $244,800. As a result of the fire, the home was assessed at $23,300 per the Raze Order. The Order stated that it was unreasonable to repair the home pursuant to Wis. Stat. 66.0413(1)(c). When a property is “wholly destroyed,” the insurance company must pay the “full value” of the policy. See Wis. Stat. 632.05(2). Accordingly, Haynes argued that her home was wholly destroyed because the Raze Order said it could not be repaired and was unfit for human habitation. But American Family disagreed.

American Family obtained a repair estimate for $146,906 and sent Haynes a Total Actual Cash Value Settlement offer listing the Replacement Cost Value as $130,947.62. Days later, American Family increased the amount slightly and then paid Haynes $131,578 on October 9, 2012. American Family had the contractor from whom it obtained an estimate to pull a repair permit, but Haynes objected and the City revoked the permit. Haynes’ home was ultimately razed.

Haynes sued, arguing that American Family owed her the full value of the home. American Family argued that a City inspector told both Haynes and American Family that she had the option of repairing or razing the property and that if she chose to repair it, the Raze Order would be withdrawn. The inspector also allegedly told American Family that the cost of repairs “was in the range of at least $75,000 to $1000,000.” But the Raze Order never mentioned the option of repair, and neither Haynes nor anyone else ever appealed the Raze Order. Further, the informal estimate offered by the inspector still exceeded the statutory formula in section 66.0413 used to determine whether repair is reasonable.

The court of appeals reversed the trial court and held that Haynes was entitled to the full value of her home: $244,800.

Of course, [Wis. Stat. 66.0413’s] command trumps any contrary analysis or post-hoc assessment by [the inspector] that he sets out in his affidavit. Simply put, the focus is on whether repairs are reasonable under the statutory formula, not whether elements of the structure survived the fire. The unappealed Raze Order, which, as we have seen, applied the mandated statutory formula, is conclusive.


UIM Coverage Determined by Entitlement, Not Recoverability

The Court of Appeals recently examined a case involving a car accident with a municipally-owned vehicle being operated by a municipal employee. There is a statutory cap on recoverable damages applicable to municipalities, Wis. Stat. § 345.05(3), and State Farm argued that its insured was not an underinsured motorist because he was not “legally entitled to recover” any amount above the $250,000 statutory cap. In its analysis, the appellate court focused on whether the insured was entitled to recover and not whether the amounts were actually recoverable. Ultimately, it reversed the circuit court and held that the insured was an underinsured motorist.

In State Farm Mutual Automobile Ins. Co. v. Hunt, 2013AP002518, Mr. Hunt was seriously injured in an accident with a Dane County snow plow. His damages exceeded $250,000, and it was not disputed that the accident was caused by the County employee’s negligence. Hunt had insurance through State Farm, and his policy was issued on October 10, 2011. At that time, Wis. Stat. § 632.32(1), (4)(a)2m required all policies of insurance to include underinsured motorist coverage. The statute defined UIM coverage as:

coverage for the protection of persons insured under that coverage who are legally entitled to recover damages for bodily injury, death, sickness, or disease from owners or operators of underinsured motor vehicles.

Wis. Stat. § 632.32(2)(d) (2011-12).

Continue reading

Expert Opinion Excluded Under Wisconsin Daubert Statute as Not Based on Sufficient Facts or Data

The Wisconsin Court of Appeals recently decided one of the first cases analyzing the exclusion of an expert witness under the recently-revised Wis. Stat. § 907.02(1), Wisconsin’s Daubert statute.  In Nationwide Agribusiness v. August Winter & Sons, Inc., No. 2014AP488 (Wis. Ct. App. Oct. 2, 2014), Nationwide was trying to recover payments it made to its insured for property damage and business interruption expenses caused by an explosion of a boiler which August Winter had installed and placed into service.  Nationwide planned to call a single expert witness, Duane Wolf, to prove causation.  In his report, Wolf opined that an August Winter employee failed to sufficiently tighten a screw, which resulted in the accumulation of excessive gas and, ultimately, caused the explosion.

August Winter filed a pretrial motion to exclude Wolf’s testimony arguing, among other things, that Wolf’s deposition showed that his opinion depended on an assumed fact with no basis.  Wolf assumed that the screw was too loose at the particular time of the explosion and based that assumption on scratch marks the screw left, without explaining why the scratch marks could not have occurred at another point in time.  The circuit court agreed with August Winter that Wolf’s factual assumption lacked support and excluded Wolf’s causation opinion.

Continue reading

Seventh Circuit Holds That Panhandling Ordinance is Content-Neutral, Constitutional

Recently, the Seventh Circuit issued a decision about regulation of First Amendment rights in which it included what could be read as a disclaimer about the holding it reached: “We do not profess certainty about our conclusions.” See Norton v. City of Springfield, Ill., 13-3581, 2014 WL 4756402 (7th Cir. Sept. 25, 2014). It held that a panhandling ordinance was content-neutral and therefore the city’s prohibition against certain kinds of panhandling was constitutional.

Like many cities, Springfield Illinois has an ordinance that prohibits panhandling in its “downtown historic district.” That district comprises less than 2% of the City’s total area but contains “its principal shopping, entertainment, and governmental areas, including the Statehouse and many state-government buildings.” The ordinance only prohibits “oral requests for an immediate donation of money.” Signs requesting money and verbal requests that money be sent later are both acceptable.

Springfield evidently views signs and requests for deferred donations as less impositional than oral requests for money immediately, which some persons (especially at night or when no one else is nearby) may find threatening.

P. 2. There are two kinds of regulations that are content-based and therefore invalid infringements of First Amendment rights: regulation that restricts speech because of the ideas it conveys, and regulation that restricts speech because the government disapproves of its message. The court recognized the split amongst circuits as to whether similar ordinances were content-based and therefore unconstitutional. The Fourth, Sixth, and Ninth Circuits have held similar ordinances invalid, while the First Circuit and the District of Columbia held that similar ordinances were content-neutral and therefore valid. The court also examined Supreme Court precedent that, while not directly analogous, consistently recognized that the regulation in question must be “reasonable.”

Continue reading

School District Not Liable For One Student’s Bullying of Another

A recent Seventh Circuit case reiterated the high burden to impose liability on a school for one student’s mistreatment of another. In Doe v. Galster, et al., No. 13-2551, a girl sued the Elmbrook School District and several school administrators after severe bullying resulted in criminal charges against her tormentors. She asserted claims against the district under Title VI of the Civil Rights Act of 1964, Title IX of the Education Amendments of 1972, and a section 1983 claim for violations of the Equal Protection Clause.

The girl, “Jane Doe,” was born in Russia and adopted at the age of two by American parents. The events that gave rise to her claim began during the sixth and seventh grade, a period of time that even the most gregarious and graceful pre-teens know to be painfully awkward if not constantly mortifying.  During those years, several of Doe’s male classmates bullied her and she claims they used gendered and ethnic insults. The bullying even turned violent, at which point three of the boys were charged with criminal battery.

The thought of a girl being bullied so viciously that criminal charges ensued is heartbreaking. The Seventh Circuit used language suggesting that they too understood how reprehensible the bullies’ actions were, calling the classmates’ actions “inexcusable.” However, the frequent thoughtlessness and cruelty of children, which regrettably is not unique to this instance, must color a court’s interpretation of the standards of Title VI and Title IX when determining a school’s liability.  In order to hold the school and its administrators liable,

School officials must have had “actual knowledge” of harassment “so severe, pervasive, and objectively offensive that it can be said to deprive the victims of access to the educational opportunities or benefits provided by the school.” To have actual knowledge of an incident, school officials must have witnessed it or received a report of it. To impose liability, school officials’ response to known harassment also must have been “clearly unreasonable in light of the known circumstances.”

p. 2-3, quoting Davis v. Monroe County Board of Education, 526 U.S. 629 (1999) and citing Gabrielle M. v. Park Forest–Chicago Heights, Illinois School Dist. 163, 315 F.3d 817, 823–24 (7th Cir.2003).

Continue reading

Recent Seventh Circuit Case Permits Respondeat Superior Liability for Municipality

Pardon me while I dust the cobwebs out of here and shoo away the crickets. Yes, it’s been a while since we’ve last posted. But there have not been many noteworthy–and published– decisions from Wisconsin courts on which to report.

Lest you fear that we’ve thrown in the blogging towel, I am here to assure you that we are ever vigilant for interesting and significant cases. One such case is Petkus v. Richland County, Wisconsin, — F.3d —, 2014 WL 4073075 (7th Cir 2014).

Petkus operated an animal sanctuary in Richland County in rural southwestern Wisconsin. In 2009, Petkus was arrested after an investigation by the ASPCA related to animal cruelty claims under Wis. Stat. § 173.10. The ASPCA investigation included a search of Petkus’s property and resulted in removal of over 300 animals and prosecution for animal neglect. She was convicted and sentenced to three years of probation. Petkus then sued the County and several of its deputy sheriffs, alleging negligence and violation of 42 U.S.C. § 1983. Petkus argued that the County and deputy sheriffs were liable for the negligence of the ASPCA volunteers who conducted the search under the doctrine of respondeat superior for causing extensive physical damage to her house, barn, and other property and causing emotional distress. She also alleged that the search was unreasonable within the meaning of the Fourth Amendment. A jury found in favor of Petkus, though the judge reduced the damages awarded to her. Both sides appealed.

While normally respondeat superior does not apply to municipalities, the County did not challenge its applicability. Thus, the Court took up the County’s argument that it was not responsible for the damage “because the sheriff’s deputies did not supervise the animal-rights activists who conducted the search and who therefore inflicted the damage.” The Court rejected that argument, explaining rather colorfully,

Police cannot hire the Hell’s Angels to conduct highway patrol and, though failing to train or supervise them, shuck off responsibility when one of the Angels beats a speeder into a bloody pulp with a tire iron.

Continue reading

Supreme Court Explains What Evidence is Necessary to Prove Constructive Notice in Safe Place Claims

One of the supreme court’s recently issued decision should prove helpful in defending against slip-and-fall cases, especially those that are alleged to be the result of snow and ice. See Kochanski v. Speedway SuperAmerica, 2014 WI 72. While the Kochanski decision was prompted by an erroneous use of the absent witness jury instruction, the court’s analysis necessarily required an application of its rationale to the facts: a plaintiff who slipped and fell on snow as he walked into a convenience store. The result is a decision full of useful points about what types of evidence will and will not support a Safe Place claim under Wis. Stat. § 101.11. Especially in cases relying on constructive notice, this decision should help solidify defenses when a plaintiff offers nothing more than weather records or evidence of post-fall remedial measures.

In Kochanski, the plaintiff requested and was given the absent witness instruction because Speedway relied only on surveillance video and did not call any former employees as witnesses.  The absent witness instruction provides:

If a party fails to call a material witness within [its] control, or whom it would be more natural for that party to call than the opposing party, and the party fails to give a satisfactory explanation for not calling the witness, [the jury] may infer that the evidence which the witness would give would be unfavorable to the party who failed to call the witness.

Wis JI——Civil 410. Kochanski’s attorney used the instruction to argue that Speedway didn’t call any witnesses because the testimony would have been unfavorable. He asked, “Why didn’t [Speedway] call anybody? What would that unfavorable testimony have been? Other evidence that’s missing in this case.” ¶ 7. The jury returned a verdict in favor of Kochanski.

On appeal, Speedway argued that the circuit court erroneously gave the absent witness instruction, and the court of appeals and the supreme court both sided with Speedway. In its analysis, the supreme court discussed the implications of a lack of evidence in support of claims of negligence and of violation of the Safe Place Statute. The court said there was no indication in the record that any current Speedway employees could provide information about the store’s snow removal methods, and the plaintiff did not establish that Speedway had any control over its former employees. Furthermore, Speedway provided the employees’ names and addresses to Plaintiff, but Plaintiff made no showing that he could not compel their appearance at trial by subpoena. “The safe-place claim was Kochanski’s to prove; it was not Speedway’s obligation to disprove it.” ¶ 26.

Continue reading


Get every new post delivered to your Inbox.

Join 244 other followers