STATE LAW SUMMARY Overview of the State of Wisconsin Updated 2013

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1 STATE LAW SUMMARY Overview of the State of Wisconsin Updated 2013 Preparers: Jay R. Starrett and Steven F. Stanaszak Scopelitis, Garvin, Light, Hanson & Feary, P.C. Milwaukee, Wisconsin Table of Contents Overview of the Wisconsin Court System A. Trial Courts B. Appellate Courts Procedural A. Venue B. Statute of Limitations C. Time for Filing an Answer D. Dismissal Re-Filing of Suit Liability A. Negligence B. Negligence Defenses C. Gross Negligence, Recklessness, Willful and Wanton Conduct D. Negligent Hiring and Retention E. Negligent Entrustment F. Dram Shop G. Joint and Several Liability H. Wrongful Death and/or Survival Actions I. Vicarious Liability J. Exclusivity of Worker s Compensation Damages A. Statutory Caps on Damages B. Compensatory Damages for Bodily Injury C. Collateral Source D. Pre-Judgment / Post-Judgment Interest E. Damages for Emotional Distress F. Wrongful Death and/or Survival Action Damages G. Punitive Damages H. Diminution in Value of Damaged Vehicle I. Loss of Use of Motor Vehicle

2 Evidentiary Issues A. Preventability Determination B. Traffic Citation from Accident C. Failure to Wear a Seatbelt D. Failure of Motorcyclist to Wear a Helmet E. Evidence of Alcohol or Drug Intoxication F. Testimony of Investigating Police Officer G. Expert Testimony H. Collateral Source I. Recorded Statements J. Prior Convictions K. Driving History L. Fatigue M. Spoliation Settlement A. Offer of Judgment B. Liens C. Minor Settlement D. Negotiating Directly With Attorneys E. Confidentiality Agreements F. Releases G. Voidable Releases Transportation Law A. State DOT Regulatory Requirements B. State Speed Limits C. Overview of State CDL Requirements Insurance Issues A. State Minimum Limits of Financial Responsibility B. Uninsured Motorist Coverage C. No Fault Insurance D. Disclosure of Limits and Layers of Coverage E. Unfair Claims Practices F. Bad Faith Claims G. Coverage - Duty of Insured H. Fellow Employee Exclusions Overview of the State of Wisconsin Court System A. Trial Courts The Wisconsin trial court system is divided by county, and each of the State s 72 counties has a Circuit Court. The Circuit Court hears all cases. Each county also has a Small Claims Court. In smaller counties, a Circuit Court Judge will hear small claims

3 cases. In larger counties, there are separate Small Claims Courts. The jurisdictional limit for small claims suits is generally $5,000 (tort/personal injury) or $10,000 (money judgments). In larger counties, parties must litigate small claims actions in the Small Claims Court before proceeding to a Circuit Court Judge on an appeal of a verdict. Under Wisconsin law, judges have the authority to order ADR. Nearly all judges order mediation prior to trial. With the exception of a handful of venues, Wisconsin jurors are generally considered moderate to conservative. The exception would be Milwaukee County, the State s largest jurisdiction. The venue is generally viewed as plaintiff friendly like many other urban venues. In addition to Milwaukee County, Dane County is often viewed as problematic for defendants. Madison, the State capital, is the Dane County Seat. Madison is generally viewed as liberal. This perception applies to both jurors and judges. While larger counties like Milwaukee and Dane are viewed to be more plaintiff friendly, the surrounding suburban counties are generally quite conservative and very defendant friendly. Milwaukee is generally the most plaintiff-friendly jurisdiction, and neighboring Waukesha County is viewed as the most conservative. There are no jurisdictional thresholds for jury trials. Parties can request a jury trial for small claims cases if they are willing to pay the fee. Parties may have either a six- or twelve-person jury. There is no requirement other than an increased fee to seat a 12-person jury. A five/six verdict is necessary for a party to prevail. B. Appellate Courts The Wisconsin Court of Appeals is the intermediate appellate court. It is organized into four districts. There are currently 16 Court of Appeals judges who are elected to six-year terms in district-wide elections. The Wisconsin Constitution grants the Wisconsin Court of Appeals appellate jurisdiction over those issues designated by the legislature. Under Wis. Stat , the Court of Appeals has appellate jurisdiction over all final judgments or final orders of the Circuit Courts and those cases over which the Court of Appeals grants permission. Either party may appeal any final judgment or order to the Court of Appeals for review. The Court of Appeals has discretionary authority to review any non-final order, such as a denial of a summary judgment motion. These interlocutory appeals are very rarely granted. The Courts have held that having to try a case and expend costs in doing so is not basis for granting interlocutory appeal. The highest appellate court in Wisconsin is the Wisconsin Supreme Court. It is located in Madison and has seven justices. The justices are elected to ten-year terms in state-wide elections.

4 The Supreme Court has three types of jurisdiction: (1) appellate; (2) superintending and administrative and (3) original jurisdiction. The Court has appellate jurisdiction to review the decisions of all lower courts. It has original jurisdiction to entertain actions and proceedings, but this power is reserved for exceptional cases. The case is considered exceptional when a judgment by the Court significantly affects the community at large, including the rights and liberties of the State. The Supreme Court may also remove cases from the Court of Appeals and accept cases on certification by the Court of Appeals. Wisconsin does not require a party to post a bond to file an appeal. However, judgments are not automatically stayed by virtue of the filing of an appeal. The trial court has discretionary authority over whether to grant a stay. Additionally, interest will continue to accrue on all verdicts and judgments during the pendency of appeal unless the judgment is satisfied with the Clerk of Court or a stay is executed. Procedural A. Venue Venue is Wisconsin is determined by Wis. Stat Under the statute, venue is appropriate: (1) in the county where the claim arose; (2) in the county where the property that is subject to a claim is situated; (3) in the county where a defendant resides or does substantial business; or (4) if the none of the aforementioned provisions apply, then it shall be in any county designated by the plaintiff. A party may challenge the venue as improper by motion. Under Wis. Stat , any motion must be made at or before the time the party serves a responsive pleading or motion. The only exception to this requirement is a showing that a party did not discover the grounds for improper venue after reasonable diligence. The party may also move for a discretionary change of venue under Wis. Stat The grounds for discretionary change of venue are that the change is in the interest of justice or for the convenience of the parties or witnesses. The motion for discretionary change of venue may be made at any time, and the court may also order a change of venue on its own motion. B. Statute of Limitations A civil action must be commenced within the prescribed statute of limitations. For that purpose, an action is commenced as to each defendant when the summons naming the defendant and the complaint are filed with the court. However, the action will not be deemed commenced as to any defendant upon whom service of authenticated copies of the summons and complaint has not been made within 90 days after filing. The statute of limitations begins to run from the time that the cause of action accrued. When the statute of limitations has expired, the right is extinguished as well as the remedy. The statutes of limitations are generally found in Chapter 893 of the Wisconsin Statutes. The statutes regarding tolling and disability are likewise found in Chapter 893.

5 For example, Wisconsin applies the following limitations periods to certain claims: Action to recover damages for personal injury or for wrongful death three years; Action on any contract, obligation, or liability six years; Action for wrongful taking of personal property other than trade secrets six years; Action for misappropriation of trade secrets three years from the date the misappropriation is discovered or should have been discovered by the exercise of reasonable diligence; Action for personal injury involving a minor child is two years after their 18 th birthday (except for medical negligence and claims against the State); Action for medical malpractice the later of (a) three years from the date of the injury; or (b) one year from the date the injury was discovered or, in the exercise of reasonable diligence, could have been discovered, except that an action may not be commenced more than five years from the date of the act or omission; and Action for libel, slander, assault, battery, invasion of privacy, false imprisonment, or other intentional tort to the person two years. For cases in which there is a dispute as to which state s law supplies the statute of limitations, Wisconsin has a borrowing statute. That statute applies the shorter of the statute of limitations as between the Wisconsin statute and that of another state whose statute is potentially applicable, when either the Wisconsin or foreign state s limitation period has expired. Specifically, the statute provides that no action may be maintained in Wisconsin that is brought on a foreign cause of action for which the applicable foreign period of limitation has expired. Likewise, no action may be maintained in Wisconsin on a foreign cause of action for which the applicable Wisconsin statute of limitations has expired, even though the applicable foreign statute of limitations has not expired. C. Time for Filing An Answer Wisconsin statutes on civil procedure authorize an answer to a complaint, crossclaim, and third-party complaint as well as a reply to a counterclaim. The answer or reply must contain a point-by-point response to each allegation in the complaint. In a personal injury matter, an answer must be served within 45 days after the defendant was served with the summons and complaint under Wis. Stat (1). D. Dismissal Re-Filing of Suit Wisconsin does not have a non-suit provision. A party may voluntarily dismiss a suit without prejudice if a defendant has not filed a responsive pleading. The statute of limitations is not tolled by the filing of a suit. If a party has filed a responsive pleading,

6 the plaintiff may not voluntarily dismiss a suit without prejudice absent leave of the court or by agreement of the defendant. Liability A. Negligence Wisconsin follows standard negligence principles; negligence is defined as the failure to use ordinary care. The legal definition for cause is a substantial factor. A plaintiff s injury may have more than one cause. As long as a defendant s conduct was a substantial factor in producing the injuries, the defendant is liable for any damages associated with the injuries. B. Negligence Defenses 1. Contributory Negligence Contributory negligence is negligence on the part of the plaintiff that occurs in concert with the act of the defendant and is the proximate cause of the plaintiff s injury. Contributory negligence is an affirmative defense whether the claim is based on a theory of negligence or strict liability. Wisconsin has abolished assumption of risk as a complete defense. Instead, assumption of risk is merely an element of contributory negligence. Wisconsin is a comparative negligence state. Contributory negligence does not bar recovery in an action by any person or the person s legal representative to recover damages for negligence resulting in death or in injury to person or property, if that negligence was not greater than the negligence of the person against whom recovery is sought. If the plaintiff s negligence is not greater than the negligence of the person against whom recovery is sought, plaintiff s damages shall be diminished in the proportion to the amount of negligence attributed to the plaintiff. Stated another way, a plaintiff is barred from a recovery if his/her negligence exceeds that of the defendant. 2. Open and Obvious Danger Defense The open and obvious danger defense applies when a plaintiff voluntarily confronts an open and obvious condition and a reasonable person in plaintiff s position would recognize the condition and the risk the condition presents. In landowner cases, some dangers may be so open and obvious that the defendant is absolved of any attendant duty of care with respect to the danger. In ordinary negligence cases, confrontation of an open and obvious danger by the plaintiff is merely an element to be considered by the jury in apportioning negligence and will not operate to completely bar the plaintiff s recovery. The open and obvious danger defense is available to defendants in products liability actions... whether the action sounds in negligence or strict products liability.

7 Wisconsin also recognizes an emergency doctrine as a defense to negligence. The doctrine is in the form of a jury instruction. It advises jurors that if a defendant faced an emergency not of his or her own making, and acted reasonably in response to the emergency, a jury may find him or her free from negligence. C. Gross Negligence, Recklessness, Willful and Wanton Conduct Wisconsin does not invoke gross negligence or willful and wanton conduct in basic tort cases. D. Negligent Hiring and Retention Wisconsin recognizes a cause of action for negligent hiring, training or supervision. The cause of action requires that a jury find a causal connection between an employee s negligence and a plaintiff s injuries. If the finding is made, the jury is to determine whether an employer acted reasonably in hiring, training or supervising the employee. Jurors are instructed that an employer must use ordinary care in hiring and training an employee. Ordinary care is defined as doing, or failing to do something, with respect to the hiring or supervision of an employee that creates an unreasonable risk of injury or damage to a person or property. In L.L.N. v. Clauder, 209 Wis. 2d 674, 563 N.W.2d 434 (1997), the Wisconsin Supreme Court discussed the difference between negligent hiring or training and respondeat superior. Note that there must be independent negligence on the part of the employer that led to the party s injuries. E. Negligent Entrustment Wisconsin recognizes a tort for negligent entrustment. To recover, a jury must find that the defendant was initially in control of an object, that the defendant permitted the tortfeasor to use the object, and that the defendant knew or should have known that the tortfeasor intended or was likely to use an object in a way that would create an unreasonable risk of harm to others. The seminal cases on negligent entrustment are Bankert v. Thresherman s Mut. Ins. Co., 110 Wis. 2d 435, 329 N.W.2d 150 (1983), and Kempf v. Boehrig, 95 Wis. 2d 435, 290 N.W.2d 562 (Ct. App. 1980). Wisconsin has not specifically addressed the issue of whether negligent entrustment claims may be dismissed if agency is admitted. However, an attempt to dismiss under such a theory is unlikely. Courts have upheld negligent entrustment claims against parents for entrusting vehicles to their children. See Bankert.

8 F. Dram Shop Wisconsin does not have a dram shop law. As long as the individual is of legal drinking age, there is no dram shop liability. If the individual consuming alcohol is under the age of 18, a commercial or social host may be liable. The test for liability for underage individuals is whether the liquor provider knew or should have known that the person being served was underage and that the alcoholic beverages provided to the individual were a substantial factor in causing injury to a third party. G. Joint and Several Liability Joint and several liability means that liability may be apportioned either among two or more parties or to only one or a few select members of the group, at the adversary s discretion, although the paying party may have a right to seek contribution and indemnification from any nonpaying parties. A defendant is jointly and severally liable if the defendant s negligence is found to be 51% or greater. If less than 51% negligent, the defendant is only liable for his or her percentage of negligence. H. Wrongful Death and/or Survival Actions 1. Wrongful Death In Wisconsin, a claim for wrongful death is a cause of action created by statute. The wrongful death statute provides as follows: Whenever the death of a person shall be caused by a wrongful act, neglect or default and the act, neglect or default is such as would, if death had not ensued, have entitled the party injured to maintain an action and recover damages in respect thereof, then and in every such case the person who would have been liable, if death had not ensued, shall be liable to an action for damages notwithstanding the death of the person injured, provided that such action shall be brought for a death caused in this state. The cause of action must be one that the decedent would have been able to bring had he or she survived. A cause of action for wrongful death survives the death of the wrongdoer whether or not the death of the wrongdoer occurred before or after the death of the injured person. If the tortfeasor dies prior to the action, the survivors of the injured party have a cause of action against the tortfeasor s estate or personal representative. 2. Parties Entitled to Sue An action for wrongful death may be brought by the personal representative of the deceased person or by the person to whom the amount recovered belongs. An action for wrongful death belongs to the beneficiaries and is designed to compensate for the loss of the relational interest existing between the beneficiaries and

9 the decedent. One of the purposes of the statute is to compensate the survivors for the pecuniary benefits that they would have derived from the earning power of the decedent had he or she lived. Such damages are not automatically recoverable; rather, each beneficiary must prove his or her loss. The beneficiary to a wrongful death action may collect non-economic (loss of society and companionship) and economic damages. Non-economic damages are capped. If the decedent was under the age of 18, the non-economic cap is $500,000; if 18 or older, the cap is $350,000. The beneficiary may also recover economic damages (e.g., funeral expenses) including future lost earnings. The beneficiary must demonstrate that he or she would have actually received a financial benefit had the deceased lived and continued to work. I. Vicarious Liability Wisconsin recognizes the doctrine of respondeat superior and provides that an employee s conduct is imputed to the employer when the employee is acting within the scope of his or her employment. The employer is liable based solely on the agency relationship even when there is no wrongful conduct on the employer. Wisconsin also recognizes a presumption of agency if vehicle ownership is proven. Jurors are instructed that when there is uncontroverted evidence that a defendant was the owner of an automobile driven by an individual, there is a presumption that arises that the driver was the defendant s servant. The presumption to tell the jurors that they are to presume that the driver was the defendant s servant unless they are convinced by the greater weight of the credible evidence that there was no servant relationship. Wisconsin limits a defendant s liability to independent contractors for injuries sustained during the course of the contracted work. Thus, to recover under a negligence theory, an independent contractor must demonstrate that the defendant employer engaged in active negligence. Passive negligence is not permissible. Examples include failure to warn or failure to instruct. J. Exclusivity of Worker s Compensation Wisconsin recognizes worker s compensation exclusivity as a bar to suit against an employer pursuant to Wis. Stat However, there are several exceptions. If the employer is a subsidiary or parent company of a separate, independent corporation, the parent or subsidiary may be sued. Wisconsin also recognizes the dual persona doctrine in which an employer may lose worker s compensation immunity when it possesses and acts in a second persona that is independent from and unrelated to the status as the employer. An example of the dual persona doctrine is an employer that assumes responsibility for another entity s liability through a merger or acquisition. If the acquired company is liable, the employer may not be entitled to worker s compensation immunity since it has assumed liability for another entity s obligations.

10 Under Wisconsin law, a driver could potentially sue an employer if the driver was actually employed or paid by a separate entity. A general test for this type of suit is whether the actual employing entity is a distinct legal unit from any potentially liable party. Wisconsin precludes suits against co-employees for workplace injuries with some exceptions. Under Wis. Stat (2), an employee may bring an action against a co-employee for assault for negligent operation of a motor vehicle that was not owned or leased by the employer. Damages A. Statutory Caps on Damages Wisconsin has no caps on non-economic or economic damages. There are caps on wrongful death and survivor actions as discussed above. B. Compensatory Damages for Bodily Injury Wisconsin allows damages for pain, suffering and disability along with emotional distress, past and future medical expenses, and past and future vocational loss. In addition, Wisconsin recognizes derivative claims for loss of services or consortium. Juries are instructed that pain and suffering includes not only physical pain but also items such as worry, embarrassment or distress. Vocational loss damages involve the difference between what an individual is capable of earning absent the injury and what he or she was capable of earning after the injury. Jurors are also instructed that they are to award the reasonable value of medical services. C. Collateral Source Wisconsin recognizes the collateral source rule as a rule prohibiting evidence of payments made by other parties. The most common scenario involves payments made by a health insurer to a medical provider on behalf of an injured party. If the health insurer receives a contractual discount from the provider, the collateral source rule prohibits introduction of evidence of this discount. Instead, an injured party is entitled to receive the reasonable value of his or her medical services. This can mean that an injured person receives a windfall because he or she recovers more than his or her insurer actually paid. Appellate courts have held that as a policy decision, they would rather afford a windfall to an injured plaintiff than give a discount to a tortfeasor simply because the injured individual had insurance. D. Pre-Judgment/Post-Judgment Interest Pre-judgment interest may be awarded only if the amount of damages is ascertainable or can be determined prior to a judicial determination either because

11 damages are liquidated or because there is a reasonably certain standard of measurement. Pre-judgment interest may be awarded where a debtor has failed to pay money, deliver property, or render services in accordance with his contract. Interest on a money judgment is recoverable at a rate of 1% plus the prime interest rate. If the money judgment comes after a settlement offer and is greater than or equal to the settlement offer, interest is computed beginning on the date that the settlement offer was made. E. Damages for Emotional Distress 1. Intentional Infliction of Emotional Distress A plaintiff may recover damages for intentional infliction of emotional distress if the defendant, by extreme and outrageous conduct, intentionally causes severe emotional distress to him or her. Although the emotional injury must be severe, there is no requirement of physical manifestation. In order to recover, the following four elements set out in Alsteen v. Gehl, 21 Wis. 2d 349, 124 N.W.2d 312 (1963), must be proven: a. The Conduct Must Have Been Intended to Cause Emotional Distress The conduct can be intentional in two ways. First, an action done with the purpose of inflicting emotional harm on the plaintiff is considered intentional. Second, intent may be reasonably inferred from the defendant s actions. b. The Conduct Must Have Been Extreme and Outrageous To be considered extreme and outrageous, the conduct must have been such that the average member of the community must regard the defendant s conduct in relation to the plaintiff, as being a complete denial of the plaintiff s dignity as a person. c. The Conduct Must Have Been a Cause of the Emotional Distress To pass the third prong of the Alsteen test, the conduct must have been a cause of the plaintiff s emotional distress. A predisposition to emotional distress does not preclude liability in itself. d. The Emotional Distress Must be Severe and Disabling

12 To prove the final prong of the Alsteen test, the plaintiff must show that he was unable to function in his other relationships because of the emotional distress caused by the defendant s conduct. Temporary discomfort cannot be the basis for recovery. 2. Negligent Infliction of Emotional Distress Prior to 1994, negligent infliction of emotional distress involved two standards, one standard applicable to non-bystander plaintiffs and another standard applicable to bystander plaintiffs. In Bowen v. Lumbermens Mut.l Cas. Co., 118 Wis. 2d 627, 517 N.W.2d 432 (1994), the Supreme Court of Wisconsin overruled much of the preexisting case law regarding the standard for recovery of negligent emotional distress. The court held that a uniform test for recovery should apply, irrespective of whether a non-bystander or bystander plaintiff was involved. The court articulated the three elements that a plaintiff must prove by clear and convincing evidence to recover negligent infliction of emotional distress damages: (1) the defendant engaged in negligent conduct; (2) the defendant caused the emotional distress; and (3) the plaintiff s emotional distress was severe. The Bowen court further held that, as with intentional infliction, physical manifestation is not necessary as long as the emotional distress is severe. What constitutes severe emotional distress may depend on the facts and circumstances of a specific case. However, in order to be severe, the emotional distress must be so disabling that the plaintiff is unable to function. In other words, the emotional distress must be of such substantial quantity or enduring quality that no reasonable person could be expected to endure it. The Bowen court held that the causation element of negligent infliction of emotional distress involves a determination of proximate cause, or application of public policy considerations that is solely a legal function of a court. Public policy may, as a matter of law, preclude recovery even if a plaintiff could prove negligence, causation and severe emotional distress. The court held that the following public policy factors may be considered in determining whether a plaintiff is precluded, as a matter of law, from recovery: Whether the injury is too remote from the negligence; Whether the injury is wholly out of proportion to the culpability of the negligent tortfeasor; Whether in retrospect it appears too extraordinary that the negligence should have brought about the harm; Whether allowance of recovery would place an unreasonable burden on the negligent tortfeasor; Whether allowance of recovery would be too likely to open the way to fraudulent claims; or Whether allowance of recovery would enter a field that has no sensible or just stopping point.

13 In the bystander context, the Bowen Court held that three additional factors must be considered when determining whether public policy precludes recovery: The severity of the injury to the person physically injured; The relationship of the bystander plaintiff to the person injured (spouse, child-parent, child-grandparent, sibling); and The extraordinary circumstances surrounding the bystander plaintiff s discovery of injury. 3. Other Torts Under Which a Plaintiff May Recover Emotional Distress Damages A plaintiff may recover emotional distress damages under theories other than intentional or negligent infliction of emotional distress. The plaintiff may recover for an insurance company s bad faith in failing to settle a claim if the emotional distress is severe and the plaintiff suffered other substantial damages in addition to the emotional distress. Here, the plaintiff need only show the knowledge or reckless disregard of the lack of a reasonable basis for denying or refusing to honor or negotiate on an insured s claim. Under Sorenson v. Dundas, 42 Wis. 642, a plaintiff may recover emotional distress damages for false imprisonment. Here, the plaintiff may recover for less severe emotional harm such as hurt feelings or indignity. Another way that a plaintiff may recover damages is to prove assault and battery by the defendant. Like false imprisonment, this tort entitles the plaintiff to damages for lesser emotional harm. A plaintiff may also recover emotional distress damages from a defendant who has mishandled a dead body, invading the survivor s right to provide proper burial. If the mishandling was only negligent and not intentional, the plaintiff may have to show attendant or resulting physical injury in addition to emotional harm. Under Chapter 102 of the Wisconsin Statutes governing worker s compensation, a plaintiff may recover emotional distress damages flowing from injuries that are the subject of a worker s compensation claim. Case law distinguishes between two types of emotional harm: traumatic mental injury and nontraumatic mental injury. If a traumatic injury, such as an industrial accident, caused the emotional distress, it is compensable. If a nontraumatic event caused the distress, it must have resulted from a situation of greater dimensions than the day-to-day emotional strain and tension which all employees must experience. F. Wrongful Death and/or Survival Action Damages

14 Judgment for damages for pecuniary injury from wrongful death may be awarded to any person entitled to bring a wrongful death action. Pecuniary injury means loss of any benefit that the beneficiary would have received from decedent if decedent had lived, including social security benefits and future earnings. As discussed above, additional damages for loss of society and companionship may be awarded, not to exceed $500,000 per occurrence in the case of a deceased minor, or $350,000 per occurrence in the case of a deceased adult, to the spouse, the minor children, or parents of the deceased, or to the siblings of the deceased, if the siblings were minors at the time of the death. Under a survival action, damages to which a decedent would have been entitled for pain and suffering between the injury and death survive his death and pass to the estate of the decedent. Any claim of the decedent for punitive damages in connection with the pain and suffering from injury to death passes to the estate of the decedent. Survival claims are distinct from a claim for wrongful death under the statute. Punitive damages are not recoverable incident to damages for wrongful death pursuant to Wisconsin Statute G. Punitive Damages Punitive damages may be awarded if the defendant acted maliciously toward the plaintiff or in an intentional disregard for the rights of the plaintiff. The requirement that the defendant act with an intentional disregard for the rights of the plaintiff can occur in either of two ways: (1) if the person acts with a purpose to disregard the plaintiff s rights; or (2) if the person is aware that his or her acts are substantially certain to result in the plaintiff s rights being disregarded. There is no requirement of intent to injure or cause harm. The factors relevant to an award of punitive damages include: the grievousness of the acts, the degree of malicious intent, whether the award bears a reasonable relationship to the award of compensatory damages, the potential damage that might have been caused by the acts, and the ratio of the award to civil or criminal penalties that could be imposed for comparable misconduct. H. Diminution in Value of Damaged Vehicle The measure of damages in Wisconsin for a damaged vehicle is the lesser of the cost of repair or fair market value of the property. Wisconsin does not recognize a cause of action for diminution in value. I. Loss of Use of Motor Vehicle Wisconsin recognizes a right to recover damages for loss of use for a motor vehicle. Jurors are instructed that they are to award the amount that they find will reasonably compensate the plaintiff for such loss of use. They are further instructed

15 that they may consider the reasonable rental value of a comparable automobile during the time period reasonably necessary to obtain a comparable permanent replacement vehicle. Damages awarded are in addition to the cost of a replacement vehicle. Jurors are instructed that they are not to award an amount that exceeds the amount actually spent for the rental of a temporary replacement. Evidentiary Issues A. Preventability Determination Wisconsin does not invoke a preventability determination doctrine. B. Traffic Citation from Accident Traffic citations are generally not admissible unless a driver pleads guilty or is found guilty by a jury. A no contest plea renders the citation not admissible. C. Failure to Wear a Seatbelt Failure to wear a seatbelt is admissible in Wisconsin. Failure to wear a seatbelt can increase the amount of contributory negligence attributed to a plaintiff. Jurors are instructed that a plaintiff s failure to wear a seatbelt may be negligence. Expert testimony is required to establish that a person would not have been injured if he or she had been wearing the seatbelt. Wisconsin caps the amount of negligence attributed to a plaintiff at 15% for failing to wear a seatbelt. This negligence is combined with any active negligence attributed to the plaintiff for the accident. D. Failure of Motorcyclist to Wear a Helmet Evidence of a motorcyclist s failure to wear a helmet is not admissible in Wisconsin. Adults over the age of 18 are not required to wear a helmet while riding a motorcycle. A jury may not find a plaintiff liable for failing to wear a helmet. E. Evidence of Alcohol or Drug Intoxication Evidence of intoxication is admissible if the moving party can establish legal intoxication. In a situation where a driver is found guilty of operating while intoxicated, evidence of the underlying tests conducted is admissible. Absent evidence of actual intoxication or impairment, trial judges will make a determination on a case-by-case basis of whether evidence of the possession or consumption of alcohol or illegal drugs is admissible or unduly prejudicial. F. Testimony of Investigating Police Officer Investigating officers may not testify as to their conclusions regarding fault for an accident. They may testify to their observations and any statements made by either

16 party. Officers that are accident reconstruction specialists may be allowed to testify as experts if the court finds that they are so qualified. G. Expert Testimony Wisconsin follows the Daubert standard for expert testimony. The change to the Daubert standard was made in There is no appellate case law yet interpreting Wisconsin s Daubert standards. H. Collateral Source The collateral source rule in Wisconsin prohibits evidence of payments made by non-parties. Wisconsin courts have allowed very few exceptions to the rule. In the medical expense category, courts have strictly prohibited evidence of payments made by insurers at a reduced cost. I. Recorded Statements A party s recorded statement may be introduced by any opposing party. Statements of non-parties are subject to hearsay exception standards such as unavailability. Recorded statements may be used by any party to impeach a witness. A witness that gives a recorded statement is entitled to receive a copy of the statement at his or her request. J. Prior Convictions Wisconsin allows introduction of the fact of a prior criminal conviction. Parties may question any witness on the issue of whether he or she has been convicted of a crime. If the witness admits to a conviction, questioning is limited to the number of convictions. If a witness denies the convictions, counsel may impeach him or her through the use of a judgment of conviction explaining when and where the conviction took place and what the offense was. K. Driving History Wis. Stat (2) generally prohibits introduction of evidence of other crimes, wrongs or acts. The prohibition precludes the admission of the evidence in order to show that the person acted in conformity therewith. There are several exceptions to the prohibition such as when the evidence is offered to show proof of motive or knowledge of dangers. Courts have held that evidence of prior drunk driving accidents was admissible to show that a defendant was aware that driving drunk was dangerous for the purposes of awarding punitive damages. L. Fatigue

17 Wis. Stat should preclude evidence of prior hours of service violations as improper evidence of character conduct or other wrong acts. Wisconsin has limited case law on the admissibility of hours of service violations pertaining to an accident that results in suit. The Wisconsin Supreme Court recently addressed expert testimony in a suit pertaining to the negligent approval of a commercial route that could not have been completed within the approved hours of service. Evidence of an hours of service violation may be admitted if plaintiff s counsel can link a violation to possible fatigue as a cause of the accident. It is questionable as to whether or not a Wisconsin trial judge would require expert testimony to establish the link. There is no reported case law on the issue. M. Spoliation Wisconsin does not recognize spoliation as an independent tort. Spoliation is instead sanctionable conduct. Courts are to weigh the appropriate sanction based on the nature of the conduct. If the court finds the conduct egregious, it may dismiss a case or enter a default judgment. If the conduct is not egregious or intentional, courts are free to tailor the remedies as appropriate. Settlement A. Offer of Judgment Wis. Stat allows for three types of settlement offers: (1) offers of judgment, (2) offers of damages, and (3) offers of settlement. The offers can be made any time after issue is joined and at least 20 days before the trial. These provisions are available in all civil cases with the exception of probate and land condemnation proceedings. The purpose of this statute is to encourage settlement before trial. This is accomplished by imposing sanctions if the rejected settlement offer turns out to have been more favorable to the offeree than the outcome of the trial. The sanctions vary depending on the type of offer that was made. In an offer of judgment made by defendant to plaintiff, if the plaintiff rejects the offer and fails to recover a more favorable judgment at trial, the defendant recovers its costs. In an offer of damages made by defendant to plaintiff, if the damages assessed at trial against the defendant are less than or equal to the damages offered, neither party recovers its costs. In an offer of settlement made by plaintiff to defendant, if the plaintiff recovers a more favorable judgment than the settlement offer, the plaintiff recovers double the taxable costs. If there is an offer of settlement which is not accepted and the party recovers a judgment which is greater than or equal to the settlement offer, the party is entitled to interest at 1% plus the prime rate on the amount recovered from the date of the offer of settlement until the amount is paid. B. Liens

18 Wis. Stat provides for a hospital to have a lien for its services rendered to any person who sustained personal injuries as a result of the negligence, wrongful act, or tort of any other person. This lien attaches to all rights of action, suits, claims, demands, and upon the proceeds of any settlement that the injured person may have against or receive from another person for damages resulting from the injury. Hospitals are not eligible for this lien if the person injured is eligible for worker s compensation. Written notice of the lien must be filed with the clerk of circuit court in the county where the injury occurred, the hospital is located, or the suit is pending, within sixty days after the discharge of the injured person. After the lien is filed, any person making payment to the injured person upon a judgment, claim, or demand remains liable to the hospital, for the amount of the lien, for a period of one year from the date of payment. The hospital lien does not prejudice or interfere with any lien or contract for attorneys fees and is subservient to court costs. Under Wis. Stat , an employer or worker s compensation carrier who paid a worker s compensation claim has a right to make a claim or maintain an action in tort against any other party for the worker s injury or death. The statute specifies how the proceeds of such actions should be allocated as between the employer/carrier and the injured worker. The proceeds are first allocated for the reasonable costs of collection, which includes attorneys fees distributed by the court for both the employee and the compensation carrier. One-third of the remainder (the total proceeds minus collection costs) goes to the injured employee. From the balance left, the employer or insurance carrier is reimbursed for all payments made on the claim. If there is any balance remaining, it is paid to the employee. The Department of Workforce Development is entitled to a lien on all property of an employer, real or personal, located in Wisconsin for the full amount of any wage claim. This lien has superpriority and takes precedence over all other debts, judgments, decrees, liens or mortgages against the employer except the lien of a financial institution that originated before the wage lien or certain liens recorded by the Department of Natural Resources for environmental repairs. C. Minor Settlement Wisconsin requires that all settlements involving minors be approved by the court. Wis. Stat states that a natural guardian may petition the court for the minor s settlement if the natural guardian is represented by counsel. If the natural guardian or parent is not represented by counsel, the guardian ad litem must petition the court for settlement approval. D. Negotiating Directly With Attorneys An unrepresented plaintiff is permitted to negotiate settlement directly with attorneys.

19 E. Confidentiality Agreements Confidentiality agreements are permitted in Wisconsin. Parties are free to enter into any confidentiality agreement that they deem appropriate. If the parties cannot agree, Wis. Stat provides that the court may make such orders as appropriate to protect confidential information upon the petition or motion from a party. F. Releases Wisconsin recognizes a type of release in multi-defendant tort cases known as a Pierringer release. In a Pierringer release, the plaintiff agrees to satisfy and release the percentage of causal negligence damages attributable to the settling defendant and the judgment, if any, against the non-settling defendant will only be for that percentage of negligence allocated to it by the jury verdict. The non-settling defendant then has no claim for contribution against the settling defendant. Courts have found that a Pierringer release encourages settlement as it operates as a satisfaction of that portion of the plaintiff s cause of action for which the settling joint tortfeasor is responsible, while at the same time reserving the balance of the plaintiff s cause of action against a nonsettling joint tortfeasor. The Supreme Court of Wisconsin has held provisions of a settlement agreement void as against public policy that released liability for injuries arising from future misconduct and that contained a covenant not to sue with respect to such future misconduct. The Court explained that it is against public policy to covenant not to sue based on misconduct of the defendant that is subsequent to the agreement. With respect to exculpatory contracts, i.e., contracts made before an injury occurs that release a party from liability, such contracts are disfavored in Wisconsin. Exculpatory contracts are often held to be void on public policy grounds. Wisconsin courts consider a variety of factors in analyzing the validity of such contracts, including, for example: Whether the contract is conspicuously labeled as a release or containing a release; Whether the release is extremely broad and all-encompassing; Whether the release is in a standardized form leaving little room for bargaining power by the releasor; and Whether the contract releases liability for reckless and intentional contract. An exculpatory contract will be construed strictly against the party seeking to rely on it, and it will be held to violate public policy if it is so broad that it would absolve the defendant from any injury to the plaintiff for any reason. G. Voidable Releases Wisconsin does not allow unrepresented individuals to void releases.

20 Transportation Law A. State DOT Regulatory Requirements Wisconsin Department of Transportation has adopted most of the FMCSR. A link to the specific administrative code may be found at: Sections Trans 325 and 327 delineate the adopted regulations. B. State Speed Limits Speed limits on interstate highways are 65 miles per hour unless the road travels through certain populated areas. At that point, the speed limit is reduced to 55 miles per hour. C. Overview of State CDL Requirements Wisconsin requires a CDL to operate a vehicle that weighs in excess of 26,000 pounds as determined by the highest of the following weights: (1) vehicle weight rating; (2) manufacturer s gross combination weight rating; (3) actual weight; or (4) registered weight. A CDL is also required to carry any hazardous materials that require a placard under federal law or to operate any vehicle used or designed to carry 16 or more individuals including the driver. Specific requirements may be found at: Wisconsin has adopted an Unfair Claims Practices Act. The Act, delineated in the Wisconsin Administrative Code 6.11, prohibits a variety of claims practices including failing to promptly acknowledge communications with respect to claims, failing to provide necessary claims forms, failing to attempt a good faith and equitable settlement of claims submitted for which liability has become clear. For purposes of the provisions, prompt is defined as within ten days of the receipt of correspondence from a claimant or insured. Violations of the act can subject an insurer to civil forfeitures or suspension of revocation of a license to transact business in the state. Insurance Issues A. State Minimum Limits of Financial Responsibility Wisconsin law requires minimum insurance liability coverage limits to be $25,000 per person, $50,000 per accident. The minimum property damage limits are $10,000. Statutes also mandate medical payments coverage of at least $1,000 unless the insured specifically rejects the coverage. B. Uninsured Motorist Coverage

21 Uninsured motorist coverage (UM) is designed to compensate the victim of an uninsured motorist s negligence to the same extent the victim would have been compensated if the uninsured motorist was insured. An uninsured motor vehicle includes an unidentified motor vehicle involved in a hit-and-run accident. For uninsured coverage to be triggered, there must be physical contact between the unidentified motor vehicle and the insured. This requirement has been litigated frequently in Wisconsin. Stacking occurs when an insured is covered by more than one insurance policy. Stacking permits the insured to look to all relevant policies to provide coverage for the same loss and to obtain benefits from the multiple policies. Insurers are permitted to include anti-stacking provisions in their policies. The statutory language, however, is permissive, not mandatory. A reducing clause included in a policy reduces the coverage available by any amount received from other sources. The validity of such clauses has been upheld since the enactment of Wis. Stat (5)(i)1 in The language of this statute is permissive, not mandatory. C. No Fault Insurance Wisconsin does not have no-fault insurance provisions. D. Disclosure of Limits and Layers of Coverage Once a plaintiff files suit, a carrier is required to produce its policy and limits information. Wisconsin is a direct action state that allows plaintiffs to sue insurers directly and, thus, seek discovery on the insurance limits. E. Unfair Claims Practices See below. F. Bad Faith Claims Bad faith is an intentional tort which is governed by the two-year limitations period set forth in Wis. Stat The insurer s fiduciary duty to its insured arises from the unique aspect of insurance contracts by which the insurer exercises such complete control, whether the company is attending to the claims of third persons against the insured or the claims of the insured itself, that there is an implied covenant of good faith and fair dealing. Because bad faith claims are intentional torts, the proof must satisfy the middle burden, namely, proof by clear, satisfactory and convincing evidence. To succeed on a claim of bad faith, the insured must satisfy two criteria. First, the insured must show the