Wisconsin Business and Commercial Litigation

In Casper v. American Intern. South. Ins. Co., the Wisconsin Supreme Court took on three different issues, all important in business litigation.  The case arose from a collision between a truck driven by a trucker full of three different drugs and a minivan with a Sheboygan family on vacation in Milwaukee.  Multiple serious injuries resulted, and a lawsuit with numerous defendants (and plaintiffs) followed. 

Part way into the litigation, the plaintiffs sought to obtain a default judgment when a defendant’s excess insurer (National Union) failed to answer the fifth amended complaint within 45 days.  National Union, of course, claimed excusable neglect under Wis. Stat. 801.15(2)(a), because, although it followed its claims procedures, the complaint was “lost in the mail.”  Accepting National Union’s argument, the Supreme Court provided some guidance to lower courts when faced with similar circumstances:

At the court of appeals, the Caspers argued that “lost in the mail” cannot constitute excusable neglect as a matter of law. The court of appeals rejected this argument, and we agree. We cannot reject out-of-hand the possibility that a packet was actually “lost in the mail,” although courts should be skeptical of glib claims that attribute fault to the United States Postal Service. Here, the affidavits from Weisinger and Lanphear show that these individuals acted in normal fashion and that their established routine worked previously to provide timely answers to the plaintiffs in this case. When an entity is processing thousands of complaints, a few inadvertent mishaps are bound to occur. Courts should carefully scrutinize what steps an organization has taken to avoid such mishaps, how quickly the organization responds when it discovers its delinquency, and whether its delay has caused prejudice to the plaintiffs. The circuit court here considered these factors, and the Caspers have not shown that the circuit court erroneously exercised its discretion after considering all the circumstances involved.

Not content with dodging a fairly strong motion for default judgment, National Union moved for summary judgment, arguing that  the plaintiffs could not maintain a direct action claim when National Union’s policy of insurance was neither delivered nor issued for delivery in Wisconsin.  The court considered Wis. Stats. 632.24 and 631.01, along with Kenison v. Wellington Insurance Co., 218 Wis. 2d 700, 582 N.W.2d 69 (Ct. App. 1998).  The court expressly overruled Kenison and granted the plaintiffs the ability to pursue direct action against National Union:

Consequently, we hold only that Wis. Stat. § 632.24 applies to any policy of insurance covering liability, irrespective of whether that policy was delivered or issued for delivery in Wisconsin, so long as the accident or injury occurs in this state.

Finally, the Supreme Court avoided taking up the potential individual liability of corporate officers for negligence in the performance of their duties as a corporate officer by finding that in this case public policy precluded liability, even if it were available.

car accident photo courtesy digitizedchaos via this license

In Parker v. Wisconsin Patients Compensation Fund, 2009 WI App 42, the District 4 Court of Appeals addressed the standards governing trial court scheduling order decisions.  The issue arose when the plaintiff argued that the key defense expert should have been barred from testifying because the defense failed to name the expert by the date.

For those worried about timely performance under scheduling orders, the most important discussion in the opinion is:

Consistent with Schneller II, we conclude that the excusable neglect standard set forth in Wis. Stat § 801.15(2)(a) does not apply to untimely motions to enlarge scheduling order deadlines. Rather, Wis. Stat. § 802.10 provides the “standards and procedures” courts apply to such motions. Moreover, requiring courts to evaluate untimely motions under the excusable neglect standard would infringe upon the circuit court’s broad discretion in addressing untimely motions to amend scheduling orders. See Teff, 265 Wis. 2d 703, ¶29; see also City of Sun Prairie v Davis, 226 Wis. 2d 738, 749-50, 595 N.W.2d 635 (1999) (courts have inherent authority to take actions that ensure their efficient and effective function).  As the supreme court explained in Schneller II, 162 Wis. 2d at 310, such discretion “permits the court to take steps ranging from granting the requested relief to dismissing the moving party’s case, [and] is absolutely essential to the court’s ability to efficiently and effectively administer its calendar.”

This comes as relatively good news to those who hope to convince a court that missing a scheduling order deadline shouldn’t interfere with the presentation of the case on the merits.  In that the decision is now committed even more firmly to the court’s discretion, knowledge of the judge is imperative.