Case Title: Kerry L. Putnam v. Time Warner Cable of Southeastern Wisconsin

Citation: 2002 WI 108

Docket Number: 1999AP002078

State: wisconsin

Court: Wisconsin Supreme Court

Date: 2002-07-16T00:00:00Z

Document:
2002 WI 108 
 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
99-2078 
 
 
COMPLETE TITLE: 
 
 
Kerry L. Putnam, Carol L. Smith-Carter and Louis 
Boutan, individually and on behalf of all others 
similarly situated,  
 
Plaintiffs-Appellants-Petitioners, 
 
v. 
Time Warner Cable of Southeastern Wisconsin, 
Limited Partnership,  
 
Defendant-Respondent. 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
2001 WI App 196 
Reported at:  247 Wis. 2d 41, 633 N.W.2d 254 
(Published) 
 
 
OPINION FILED: 
July 16, 2002   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
February 4, 2002   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Milwaukee   
 
JUDGE: 
Lee E. Wells   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
CONCURR/DISSENT: 
BABLITCH, J., concurs in part, dissents in part 
(opinion filed). 
ABRAHAMSON, C.J., joins concurrence/dissent. 
 
DISSENTED: 
SYKES, J., dissents in part (opinion filed). 
WILCOX and CROOKS, JJ., join dissent.   
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the plaintiffs-appellants-petitioners there were briefs 
by John C. Cabaniss and Law Office of John C. Cabaniss, 
Milwaukee, and John J. Carey and Carey & Danis, LLC, St. Louis, 
Missouri, and oral argument by John C. Cabaniss. 
 
For the defendant-respondent there was a brief by Robert H. 
Friebert, Jeremy P. Levinson and Friebert, Finerty & St. John, 
S.C., Milwaukee, and oral argument by Robert H. Friebert. 
 
2002 WI 108 
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  99-2078   
(L.C. No. 
98 CV 8772) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Kerry L. Putnam, Carol L. Smith-Carter  
and Louis Boutan, individually and on  
behalf of all others similarly situated,  
 
          Plaintiffs-Appellants- 
          Petitioners, 
 
     v. 
 
Time Warner Cable of Southeastern  
Wisconsin, Limited Partnership,  
 
          Defendant-Respondent. 
 
FILED 
 
JUL 16, 2002 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed in 
part, reversed in part, and cause remanded.   
 
¶1 
DAVID T. PROSSER, J.    This is a review of a 
published decision of the court of appeals,1 which affirmed an 
order of the Milwaukee County Circuit Court, Lee E. Wells, 
Judge, dismissing with prejudice an action brought by a putative 
class of cable television customers against Time Warner Cable of 
Southeastern Wisconsin, Limited Partnership (Time Warner). 
                                                 
1 Putnam v. Time Warner Cable of SE Wis., 2001 WI App 196, 
247 Wis. 2d 41, 633 N.W.2d 254. 
No. 99-2078  
 
2 
 
¶2 
Two issues are presented for review.  First, does the 
voluntary payment doctrine preclude cable television customers 
from recovering the portion of monthly late-payment fees that 
they claim constitutes unlawful liquidated damages if the 
customers paid the fees without expressing any objection or 
protest?  Second, did the circuit court erroneously exercise its 
discretion when it concluded that the customers' request for a 
declaration of rights and injunctive relief to prevent Time 
Warner from imposing such late-payment fees in the future was 
not justiciable because the customers failed to allege a present 
harm? 
¶3 
We hold that the voluntary payment doctrine bars cable 
customers from recovering monetary damages for their payment of 
allegedly unlawful fees without objection or protest, if the 
customers do not properly allege mistake of fact on their part 
or fraud or duress on the part of the cable company.  We also 
conclude, however, that the circuit court misapplied the law 
with respect to justiciability requirements for declaratory 
judgments.  Therefore, the customers' claims for declaratory 
relief should be permitted to go forward. 
I.  BACKGROUND 
¶4 
The issues in this case stem from Time Warner's 
imposition of a $5.00 late-payment fee on cable customers who 
fail to pay their monthly cable bill by the time specified in 
their contract.  Three of these customers, Kerry L. Putnam, 
Carol L. Smith-Carter, and Louis Boutan, individually and on 
behalf of a putative class of similarly situated customers (the 
No. 99-2078  
 
3 
 
customers or plaintiffs), brought an action to recover monetary 
damages for that portion of the fee which, they claim, is not 
reasonably related to Time Warner's actual costs incurred as a 
result of late payments.2  The customers also sought declaratory 
and injunctive relief to prevent Time Warner from imposing such 
fees in the future. 
¶5 
The customers' amended complaint contained numerous 
allegations against Time Warner.  The complaint alleged that 
customers 
are 
required, 
upon 
"installation 
and/or 
other 
activation of cable television programming," to execute an 
adhesion contract, unilaterally constructed by "Time Warner, a 
licensed monopoly."  It asserted that this contract expressly 
requires customers to prepay for the first month of cable 
service, and Time Warner thereafter imposes a $5.00 late fee on 
customers who subsequently fail to pay their cable bills by the 
monthly due date.3  The complaint further alleged that Time 
Warner's late fee "does not, in fact, bear a reasonable 
relationship to the costs incurred by Time Warner solely as a 
                                                 
2 The amended complaint stated the following theories of 
relief: (1) unlawful liquidated damages; (2) unconscionability; 
(3) breach of implied covenants of good faith and fair dealing; 
(4) unjust enrichment; (5) restitution; (6) money had and 
received; (7) violation of Wisconsin's Trade Practices Act; (8) 
equitable accounting; and (9) declaratory and injunctive relief.  
3 The complaint alleged that this payment system represents 
a deliberate profit-making scheme by Time Warner.  According to 
the complaint, "Time Warner consciously designed its billing 
cycle and due dates to uniformly and systematically 'catch' a 
consistent percentage of its customer base paying late.  In this 
manner, Time Warner guarantees that late fees will provide a 
consistent and substantial source of revenue."  
No. 99-2078  
 
4 
 
result of the late payments and/or late paying customers," nor 
is it a reasonable estimate of that cost.  It asserted that the 
actual cost facing Time Warner for a single late payment is 
between $0.38 and $0.48.  The complaint also alleged that Time 
Warner's collection of late fees constitutes a double recovery 
because 
Time 
Warner 
has 
already 
incorporated 
non-payment 
collection costs into its basic cable rates, which have been 
approved 
by 
the 
Federal 
Communications 
Commission. 
 
The 
complaint alleged that Time Warner "omitted, and continues to 
omit, conceal, and misrepresent the unreasonable basis for the 
late fee and its true nature as a penalty for late payment," and 
does so fraudulently.   
¶6 
Finally, the complaint alleged that the customers, 
"[i]n reliance on [Time Warner's] concealments, suppressions, 
and 
omissions . . . paid 
at 
least 
one 
excessive 
and 
unconscionable late fee to Time Warner" and that Time Warner 
customers paying late fees do so "under duress and the real and 
imminent threat that Time Warner, a monopolist for cable 
television 
programming . . . , 
would 
disconnect 
the 
cable 
television services of a late paying customer."   
¶7 
Time Warner moved to dismiss all the customers' claims 
on multiple grounds, among them that all the claims were 
precluded by the voluntary payment doctrine.  In response, the 
customers asserted that the doctrine was inapplicable for two 
reasons.  First, the customers did not possess knowledge of all 
the facts relevant to the late-fee charges because Time Warner 
deceptively concealed those facts.  Second, the customers lacked 
No. 99-2078  
 
5 
 
a meaningful opportunity to contest the late fees.  After 
hearing these arguments, the circuit court determined that the 
voluntary payment doctrine barred the customers' recovery of 
past late-fee payments in excess of Time Warner's actual costs.  
The court also concluded that the claim for declaratory and 
injunctive relief was not ripe for resolution because the 
amended complaint failed to allege that any customer had 
presently refused to pay a late fee.  It therefore granted the 
motion to dismiss and denied the customers' petition for leave 
to further amend their complaint. 
¶8 
In affirming both conclusions, the court of appeals 
advanced multiple reasons why, "regardless of the truthfulness 
of the customers' assertions, the voluntary payment doctrine 
precluded their claims for recovery of late-fee payments in 
excess of Time Warner's actual costs."  Putnam v. Time Warner 
Cable of SE Wis., 2001 WI App 196, ¶9, 247 Wis. 2d 41, 633 
N.W.2d 254.  First, the customers failed to allege that Time 
Warner had any duty to disclose the specific factors affecting 
the late fee amount, and Time Warner had no duty.  Id. at ¶10.  
Second, the amended complaint did not allege that fraudulent 
actions by Time Warner materially affected the customers' 
decisions to pay the late fees.  "If the customers never 
considered the propriety of the late fees before paying them, 
they certainly did not pay the fees as a result of any 
fraudulent misrepresentation or concealment."  Id. at ¶11.  
Third, 
"at 
most, 
[the 
customers] 
paid 
[the 
late 
fees] . . . because of a mistake of law regarding whether Time 
No. 99-2078  
 
6 
 
Warner was legally entitled to charge the $5.00 late fee."  Id. 
at ¶12.  Fourth, the customers failed to establish that they 
paid the late fee as a result of fraud or mistake perpetrated by 
Time Warner.  Id. at ¶13.  Finally, the customers' claim that 
they were subject to Time Warner's threats of disconnecting 
cable service for not paying a late fee did not rise to the 
level of economic duress as a matter of law.  Id. at ¶14. 
¶9 
The court of appeals also noted that, despite some 
legal differences between the customers' claim of unlawful 
liquidated damages and their other claims for monetary relief, 
the customers' unlawful liquidated damages claim was also 
properly dismissed based on their voluntary payments.  Id. at 
¶¶15-21.  Finally, as to the declaratory judgment action, the 
court deferred to the circuit court's decision that the action 
was not ripe for judicial review and declaratory relief.  Id. at 
¶27. 
¶10 On appeal to this court, the customers present two 
arguments.  They maintain that the circuit court erred in 
applying the voluntary payment doctrine in this case to claims 
based on unlawful liquidated damages.  They also contend that 
the circuit court erred in disallowing their claims for 
declaratory and injunctive relief. 
¶11 Because this dispute involves a motion to dismiss 
based on the legal insufficiency of the complaint, the circuit 
court was 
required 
to assume the 
truth 
of 
all 
factual 
allegations in the complaint.  Wausau Tile, Inc. v. County 
Concrete Corp., 226 Wis. 2d 235, 245, 593 N.W.2d 445 (1999).  In 
No. 99-2078  
 
7 
 
analyzing this case, we likewise take as true all allegations 
made in the customers' amended complaint and draw all reasonable 
inferences in favor of the customers.  Upon a motion to dismiss, 
"Unless it seems certain that no relief could be granted under 
any set of facts that the plaintiff could prove, dismissal of 
the complaint is improper."  Id. 
II.  ANALYSIS 
A.  Voluntary Payment Doctrine 
¶12 We 
first 
address 
whether 
the 
voluntary 
payment 
doctrine bars customers of Time Warner from recovering damages 
for an unlawful liquidated damages claim.  
¶13 The voluntary payment doctrine places upon a party who 
wishes to challenge the validity or legality of a bill for 
payment the obligation to make the challenge either before 
voluntarily making payment, or at the time of voluntarily making 
payment.  See 66 Am. Jur. 2d Restitution and Implied Contracts 
§ 108 (2001) ("The rule is well settled that a person cannot 
recover money that he or she has voluntarily paid with full 
knowledge of all of the facts and without fraud, duress, or 
extortion in some form, and that no action will lie to recover 
the voluntary payment."); Restatement (First) of Restitution 
§ 112 (1937).  The basic description of the doctrine, as 
employed by the court of appeals, is not in dispute.   
The voluntary payment doctrine provides that "as 
between [person] and [person], money paid voluntarily, 
with knowledge of all the facts, and without fraud or 
duress, cannot be recovered merely on account of 
ignorance or mistake of the law."  Frederick v. 
Douglas County, 96 Wis. 411, 423, 71 N.W. 798 (1897).  
No. 99-2078  
 
8 
 
The doctrine has been applied in several diverse 
contexts to preclude actions to recover payments that 
parties paid voluntarily, with full knowledge of the 
material facts, and absent fraud or wrongful conduct 
inducing payment. 
Putnam, 2001 WI App 196, ¶8.  The voluntary payment doctrine is 
often considered the counterpart to the mistake of law doctrine, 
and jurisdictions that reject one of the doctrines almost 
universally reject the other.  See Randazzo v. Harris Bank 
Palatine, N.A., 262 F.3d 663, 667-68 (7th Cir. 2001) (citing 
Stephen L. Camp, Note, The Voluntary-Payment Doctrine in 
No. 99-2078  
 
9 
 
Georgia, 16 Ga. L. Rev. 893 (1982)).  Wisconsin has adopted the 
mistake of law doctrine.4 
¶14 In Wisconsin, the voluntary payment doctrine developed 
as a common law principle and has been applied in various 
contexts.  Since the late 1800s, it has been applied to bar 
repayment of a judgment erroneously paid to an attorney, Gage v. 
Allen, 89 Wis. 98, 61 N.W. 361 (1894); to bar repayment of 
interest overpaid on a loan, Burgess v. Commercial National 
Bank, 144 Wis. 59, 128 N.W. 436 (1910); and to bar repayment of 
taxes paid on property that was tax-exempt, G. Heileman Brewing 
                                                 
4 The mistake of law doctrine states that every person is 
presumed to know the law and cannot claim ignorance of the law 
as a defense.  See Hurd v. Hall, 12 Wis. 125, 137-38 (1860); see 
also Black's Law Dictionary 1017 (7th ed. 1999) (defining a 
mistake of law as a "mistake about the legal effect of known 
fact or situation"); Restatement of Restitution § 7 ("a 'mistake 
of law' means a mistake as to the legal consequences of an 
assumed set of facts").  Long ago this court declared that "A 
mistake of law happens when a party, having full knowledge of 
the facts, comes to an erroneous conclusion as to their legal 
effect.  It is a mistaken opinion or inference, arising from an 
imperfect or incorrect exercise of the judgment, upon facts as 
they really are . . . ."  Hurd, 12 Wis. at 138.  Wisconsin has 
recognized that a mistake of law generally precludes relief, but 
the doctrine is not without limitation.  See Heinemann v. 
Rosier, 240 Wis. 19, 31, 1 N.W.2d 803 (1942) ("The general rule 
is that courts of equity will not grant relief from a mistake of 
law."); Plumbers Woodwork Co. v. Merchants Credit & Adjustment 
Bureau, 199 Wis. 466, 472, 226 N.W. 303 (1929) ("It is a general 
principle that equity will not relieve from mistakes of law.  It 
is true that to this general principle there are certain 
exceptions, but such exceptions are very limited."); Conway v. 
Town of Grand Chute, 162 Wis. 172, 174, 155 N.W. 953 (1916) ("It 
is correct as a general proposition to say that relief will not 
be granted against a mistake of law.").  This court applied the 
mistake of law doctrine in a case where the voluntary payment 
doctrine was used to deny repayment of monies previously paid.  
See Gage v. Allen, 89 Wis. 98, 106, 61 N.W. 361 (1894). 
No. 99-2078  
 
10 
 
Co., v. City of La Crosse, 105 Wis. 2d 152, 312 N.W.2d 875 (Ct. 
App. 1981). 
¶15 The "voluntary" in the voluntary payment doctrine does 
not entail the mere payment of the bill or fee.  For example, 
some customers might not pay their cable television bills if 
their cable provider did not threaten termination of service due 
to non-payment.  In this sense, payment of any bill or fee is 
not "voluntary."  Rather, the voluntariness in the doctrine goes 
to the willingness of a person to pay a bill without protest as 
to its correctness or legality.   
¶16 There are two primary reasons why courts have adopted 
the voluntary payment doctrine.  First, the doctrine allows 
entities that receive payment for services to rely upon these 
funds and to use them unfettered in future activities.  See 
Heileman, 105 Wis. 2d at 161-62.  Second, the doctrine operates 
as a means to settle disputes without litigation by requiring 
the party contesting the payment to notify the payee of its 
concerns.  After such notification, a payee who has acted 
wrongfully can react to rectify the situation.  Cf. Flambeau 
Prods. Corp. v. Honeywell Info. Sys., 116 Wis. 2d 95, 101, 341 
N.W.2d 655 (1984) (noting that the common law rule of accord and 
satisfaction, which allows for the discharge of a debt by 
substituted performance, "provides a method of settling disputes 
without litigation"). 
¶17 The plaintiffs in this case do not directly attack the 
soundness of the voluntary payment doctrine.  Rather, they 
dispute whether it applies to the circumstances of this case.  
No. 99-2078  
 
11 
 
In other words, they challenge whether a person who pays a late-
payment fee without protest and who thereafter alleges the fee 
was based on unlawful liquidated damages, is barred from making 
a claim for recovery because of the initial voluntary payment.  
We believe such claims are properly barred. 
¶18 We substantially agree with the court of appeals' 
analysis regarding the applicability of the voluntary payment 
doctrine to the customers' claims for repayment.  The thrust of 
the customers' allegations is two-fold.  First, the customers 
allege that they paid the $5.00 late fee without knowing that 
Time Warner's actual costs from a late payment were only $0.38 
to $0.48.  Second, they maintain that Time Warner concealed 
material information regarding its late-payment costs.5  Even 
assuming these allegations are true, neither allegation falls 
within the exceptions to the voluntary payment doctrine.  The 
customers appear to be synthesizing the two allegations, one 
sounding in fraud and the other in mistake of fact, with the 
hope that the whole of the summated argument will be greater 
than its individual parts. 
¶19 The 
customers' contention 
that they 
lacked 
full 
information goes to a mistake of law on their part, not a 
mistake of material fact.  The customers complain that they were 
mistaken in not realizing that the actual cost of late payment 
to Time Warner was only $0.38 to $0.48.  However, the customers 
                                                 
5 Although the customers argued a duress theory in the court 
of appeals, they abandoned that argument before this court. 
No. 99-2078  
 
12 
 
possessed full knowledge of the $5.00 late fee and of the 
circumstances under which they would be exposed to it.  See 
Dillon v. U-A Columbia Cablevision of Westchester, 740 N.Y.S.2d 
396, 398 (N.Y App. Div. 2002) (using knowledge of these facts as 
a basis for denying recovery of unlawful late-payment fees by 
cable 
customers, 
under 
the 
voluntary 
payment 
doctrine).  
Although they failed to exercise any diligence to inquire into 
or contest the cost-accounting basis of Time Warner's late-
payment 
fee, 
the 
customers 
now 
assert 
that 
Time 
Warner 
impermissibly concealed and omitted information related to the 
basis of the fee amount.  This assertion conflates the issue of 
mistake of fact with the customers' allegations of fraud.6 
¶20 The customers' allegations of fraud are to no avail.  
The amended complaint does no more than assert nebulous 
wrongdoing on the part of Time Warner; it does not allege fraud 
with the particularity required under Wisconsin's pleading 
requirements.  Wis. Stat. § 802.03 (1999-2000).7  As the court of 
appeals correctly noted, the customers failed to argue that Time 
Warner had a duty to reveal this cost-accounting information, an 
element necessary to establish fraud by omission.  See Ollerman 
v. O'Rourke Co., 94 Wis. 2d 17, 26, 288 N.W.2d 95 (1980) (citing 
Restatement (Second) of Torts, § 551, cmt. b (1977)).  In all, 
                                                 
6 Mistake of fact goes to the "unconscious ignorance or 
forgetfulness of . . . a fact . . . material to the contract."  
Kowalke v. Milwaukee Elec. Ry. & Light Co., 103 Wis. 472, 476, 
79 N.W. 762 (1899) (quotation omitted). 
7 All subsequent references to the Wisconsin Statutes are to 
the 1999-2000 version unless otherwise indicated. 
No. 99-2078  
 
13 
 
the customers' failure to know the precise factors underlying 
Time Warner's decision to charge a $5.00 late fee cannot be held 
to be a mistake of fact as to the basis for the payment made, 
nor is it the product of fraud by omission.  To conclude 
otherwise would tacitly suggest that all demands for payment in 
business transactions would need to be accompanied by an 
itemized list explaining the basis for each charge, so that the 
payor had full knowledge of the facts as required by the 
voluntary payment doctrine. 
¶21 Because the customers have failed to show fraud or 
mistake of fact, we inquire into whether there is something 
distinctive about the facts and allegations in their case that 
would warrant not applying the general rule that voluntary 
payment precludes subsequent legal redress.  The customers claim 
unlawful liquidated damages and argue that because Time Warner 
demanded unlawful liquidated damages8 the voluntary payment 
doctrine is inapplicable.  They assert that both the unlawful 
liquidated damages doctrine and the voluntary payment doctrine 
are equitable in nature but that the circuit court and court of 
appeals failed to take into account Time Warner's wrongful 
conduct before invoking the voluntary payment doctrine.   
¶22 In essence, the customers argue for the creation of an 
additional exception to the voluntary payment doctrine.  A broad 
                                                 
8 The customers allege in their amended complaint that the 
late fee provision of the cable service contract represents "an 
illegal liquidated damages provision under common law and is 
void as a matter of public policy." 
No. 99-2078  
 
14 
 
reading of this exception would be that when a private entity 
engages in wrongful conduct, the entity may not avail itself of 
the voluntary payment doctrine to block claims derived from the 
wrongful conduct.  A narrow reading of the exception would limit 
"wrongful conduct" to the use of unlawful liquidated damages 
clauses. 
¶23 We decline to create a new exception to the voluntary 
payment doctrine based on either of the preceding theories.  
Instead, we conclude that the principles of public policy and 
equity that gave birth to the doctrine support its application 
in this case. 
¶24 First, we compare an unlawful liquidated damages claim 
to the few claims of wrongdoing that are currently exceptions to 
the voluntary payment doctrine.  Second, we address how the 
competing equitable principles and public policy considerations 
of the voluntary payment doctrine reason for its application in 
this context. 
¶25 A 
claim 
of 
unlawful 
liquidated 
damages 
is 
not 
sufficiently similar to claims of fraud or duress, or mistake of 
material fact, to join them as exceptions to the voluntary 
payment doctrine. 
¶26 The differences between allegations of fraud and 
mistake of fact versus allegations of unlawful liquated damages 
are discernible in the manner in which each must be pled.  
Wisconsin Stat § 802.03(2) requires that allegations of fraud 
and mistake of fact be pled with particularity.  For instance, 
allegations of fraud must specify the particular individuals 
No. 99-2078  
 
15 
 
involved, where and when misrepresentations occurred, and to 
whom misrepresentations were made.  See Friends of Kenwood v. 
Green, 2000 WI App 217, ¶16, 239 Wis. 2d 78, 619 N.W.2d 271.  
This detailed pleading protects persons from casual allegations 
of serious wrongdoing and puts defendants on notice "so that 
they may prepare meaningful responses to the claim."  Rendler v. 
Markos, 154 Wis. 2d 420, 428, 453 N.W.2d 202 (Ct. App. 1990).  
We agree with the court of appeals in this case that the amended 
complaint fails to state with particularity the circumstances 
constituting fraud 
or 
mistake of 
fact.  
The 
fact 
that 
particularity is not required in pleading an unlawful liquidated 
damages claim counsels against allowing it as an exception to 
the voluntary payment doctrine. 
¶27 Fraud consists of a purposeful, volitional act on the 
part of the defrauding party.  See Black's Law Dictionary 670 
(7th 
ed. 
1999) 
(defining 
"fraud" 
as 
"1. 
A 
knowing 
misrepresentation of the truth or concealment of a material 
fact . . . ").  By contrast, not all invalid or wrongful conduct 
related to charging fees under a contract involves intentional 
or knowing violation of law.  For instance, a party to an 
adhesion contract may insert an unlawful liquidated damages 
clause into the contract without any intent or knowledge of its 
illegality.  In fact, as explained in Wassenaar v. Panos, 111 
Wis. 2d 518, 524-25, 357 N.W.2d 155 (1983), the test for whether 
a stipulated liquidated damages clause is valid is ultimately a 
question of reasonableness, a legal question that is heavily 
influenced by all the facts and circumstances of the particular 
No. 99-2078  
 
16 
 
case.  While a mistake of law does not shield the party 
authoring such a clause from legal challenge, it does not 
represent the type of wrongful action that should be excepted 
from the voluntary payment doctrine.   
¶28 Duress is also significantly dissimilar to unlawful 
liquidated damages.  Duress involves a patently wrongful act 
that is designed and undertaken to overcome the will of another.  
See Wurtz v. Fleischman, 97 Wis. 2d 100, 109-10, 293 N.W.2d 155 
(1980) (discussing the meaning of economic duress).  It 
overcomes the will of a payor through coercion or fear, which is 
different from the imposition of unlawful liquidated damages. 
¶29 These differences under the law in the treatment of 
allegations of fraud, duress, and mistake of fact versus 
unlawful liquidated damages advise against them being treated as 
equals.  Allegations of fraud, duress, and mistake each work to 
negate the true voluntariness of payments.  The wrongdoing of 
unlawful liquidated damages may be technical in nature. 
¶30 We believe that another rationale behind the doctrine 
is applicable to this case.  We agree with the general principle 
that a person who receives payment from another without any 
protest from the payor should be allowed to rely on use of the 
funds without risking a subsequent demand for return of the 
payment.  This principle applies with equal force when the payor 
is a cable television customer and the payee is that customer's 
cable provider. 
¶31 In Heileman, the court of appeals articulated and 
applied this policy justification.  Heileman brought suit 
No. 99-2078  
 
17 
 
against the City of La Crosse, La Crosse County, and the State 
of Wisconsin seeking return of money paid in prior years for 
taxes on property that the company later learned was tax-exempt.  
105 Wis. 2d at 154-55.  The court concluded that even though the 
previous tax assessments were void ab initio, the voluntary 
payment doctrine precluded return of the tax payments.  Id. at 
161-62.   The court stated the reason for applying the voluntary 
payment doctrine to bar the plaintiff's claim: 
The requirement of resistance to or involuntary 
payment of a tax is one of public policy: government 
has an interest in allocating its resources.  It is 
desirable that government know when it contemplates 
spending public funds that those funds are either 
available 
or 
subject 
to 
loss 
through 
tax 
refund. . . . The 
inequity 
of 
paying 
illegally 
collected taxes is outweighed by the requirement that 
government 
know 
what 
amount 
of 
income 
it 
has 
available. 
Id. 
¶32 Time Warner argues that the rationale expressed in 
Heileman applies equally to the present case.  It contends that 
a failure to apply the doctrine in cases in which a private 
entity 
is 
threatened 
with 
suit 
for 
repayment 
would 
be 
detrimental to the ability of businesses and other persons to 
reasonably rely upon and use money received.  The customers 
respond that the equitable and policy reasons behind the 
voluntary payment doctrine do not apply to the circumstances of 
the present case.  Specifically, they argue that the rationale 
behind the Heileman decision should not apply equally to non-
governmental entities.   
No. 99-2078  
 
18 
 
¶33 We 
believe 
that 
the 
rationale 
underpinning 
the 
Heileman decision is applicable to the fiscal interests of 
private entities.  Private businesses such as Time Warner should 
be able to incorporate into their revenue stream payments made 
by their customers without dispute.  All that a payor has to do 
to sidestep the voluntary payment doctrine is to make some form 
of protest over the fee prior to, or contemporaneous with, 
payment.  When a payee has been given that notice, the funds 
received can be secured for future use until the dispute is 
settled. 
¶34 We acknowledge that there are differences between 
funds received by a governmental body through taxation and 
revenue received by a private entity from business transactions.9  
                                                 
9 In his separate opinion in this case, Judge Schudson 
asked: 
[D]oes the rationale of Heileman encompass private 
enterprise?  Is it enough to say, as the majority 
declares, 
that 
"some 
of 
a 
government's 
fiscal 
concerns . . . are analogous to a private entity's 
fiscal concerns as well"?  
That's the tenuous pivot point in the majority's 
decision on the customers' unlawful-liquidated-damages 
claim.  After all, it is undisputed that if the late 
fee (or a portion thereof) is unlawful, Time Warner 
never should have charged it.  Why, then, should Time 
Warner be allowed to take financial advantage of its 
own wrongdoing?  If the Heileman rationale applies, 
the answer is clear, and Time Warner is in the clear.  
If, however, the Heileman rationale (explaining why 
government is insulated against such a claim) does not 
apply to a private enterprise that, in our free- 
market economy, perhaps should be expected to suffer 
the 
consequences 
of 
its 
wrongdoing, 
then 
the 
No. 99-2078  
 
19 
 
However, 
for 
purposes 
of 
applying 
the 
voluntary 
payment 
doctrine, the principles are similar.10  Both the public and 
private sectors should be able to rely on these resources.  The 
voluntary payment doctrine provides stability and certainty once 
funds have been transferred without notice of dispute, thereby 
decreasing the transaction costs that would accrue if payments 
received long ago could be demanded back.  As the court of 
appeals noted, "[r]egularly receiving those late-fee payments, 
Time Warner continued its operations, projecting its profits and 
costs accordingly."  Putnam, 2001 WI App 196, ¶20.  Abandoning 
the voluntary payment doctrine here would open the door for a 
wide array of challenges to past payments in the name of 
protecting persons who were tardy in inquiring into and 
contesting demands for payment.  The equities of cable customers 
who fail to make timely protests against allegedly unlawful 
late-payment fees must be weighed against the fiscal interests 
of cable providers in the certainty of payments received without 
dispute.  We find this balancing favors the latter interest and 
the preservation of the voluntary payment doctrine in this 
context. 
                                                                                                                                                             
customers' 
claim 
survives, 
notwithstanding 
the 
voluntary payment doctrine. 
Putnam, 2001 WI App 196, ¶¶36-37 (Schudson, J., concurring in 
part, dissenting in part) (citations omitted). 
10 In addition, we note that the voluntary payment doctrine 
is not new to private actions.  See Gage v. Allen, 89 Wis. 98, 
61 N.W. 361 (1894); Burgess v. Commercial Nat'l Bank, 144 Wis. 
59, 128 N.W. 436 (1910). 
No. 99-2078  
 
20 
 
¶35 Adoption of the customers' argument would effectively 
destroy 
the 
voluntary 
payment 
doctrine. 
 
The 
doctrine 
presupposes mistaken or wrongful conduct by the payee.  To allow 
someone who made voluntary payment without objection to claim 
restitution, based only on an allegation that some wrongful 
conduct by the payee caused the payment of a fee, would nullify 
the doctrine in Wisconsin.  We conclude that the merit of a 
claim and the underlying wrongdoing of the defendant do not 
undercut the applicability of the doctrine, absent fraud, 
duress, or mistake of fact.  The legislature has the power to 
create additional exceptions to the voluntary payment doctrine 
in particular circumstances. 
¶36 In sum, the voluntary payment doctrine bars recovery 
of bills or fees previously paid without protest, absent 
properly pled allegations of fraud, duress, or mistake of fact.11  
None of these exceptions was properly alleged against Time 
Warner 
in 
this 
action 
regarding 
its 
late-payment 
fees.  
Therefore, the customers' current claims for repayment are 
precluded by their previous failure to object to the late-
                                                 
11 This holding is consistent with a number of nearly 
identical cases from other jurisdictions in which recovery of 
late fee payments to cable providers was barred by the voluntary 
payment doctrine.  See, e.g., Horne v. Time Warner Operations, 
119 F.Supp. 2d 624 (S.D. Miss. 1999); Hassen v. MediaOne, 751 
So. 2d 1289 (Fla. Dist. Ct. App. 2000); Telescripps Cable Co. v. 
Welsh, 542 S.E.2d 640 (Ga. Ct. App. 2000); Time Warner Entm't 
Co. v. Whiteman, 741 N.E.2d 1265 (Ind. Ct. App. 2001); Dillon v. 
U-A Columbia Cablevision of Westchester, 740 N.Y.S.2d 396 (N.Y 
App. Div. 2002); McWethy v. Telecomms. Inc., 988 P.2d 356 (Okla. 
Civ. App. 1999).  
No. 99-2078  
 
21 
 
payment fees prior to or contemporaneous with payment.  Any 
claims for monetary relief of these payments deriving from an 
unlawful liquidated damages claim were correctly dismissed by 
the circuit court.12 
B.  Declaratory Relief 
¶37 We now address whether the circuit court properly 
denied the customers' claim for declaratory relief to prevent 
Time Warner from imposing late-payment fees in the future. 
¶38 In the amended complaint, the customers asserted a 
claim 
for 
"Declaratory 
Injunctive 
and 
Equitable 
Relief" 
involving a series of requests for court orders, regarding the 
propriety of Time Warner's late-payment fees.13  The customers 
                                                 
12 Each of the claims for relief stated in the amended 
complaint is premised on a theory of liability that Time Warner 
imposed an unlawful liquidated damages clause through the 
insertion of the $5.00 late-payment fee in its service contracts 
with cable subscribers.  Each count alleges, in some manner, 
that Time Warner received payments from the late fees "which are 
not reasonably related to its actual costs."  We conclude that 
because the customers are precluded under the voluntary payment 
doctrine from seeking repayment of allegedly unlawful liquidated 
damages, the additional claims, with the exception of claims for 
declaratory relief, are encapsulated in the overall theory and 
are properly subject to the voluntary payment doctrine. 
13 The complaint asked for: 
(a) [A] court determination of the rights of Plaintiffs and 
the Class and the corresponding rights of Time Warner concerning 
the imposition of late fees; 
(b) [A] court declaration that Time Warner has unlawfully 
imposed excessive late fees on Plaintiffs and the Class Members; 
(c) An order enjoining Time Warner from continuing to 
impose late fees that are not related to its reasonable costs; 
No. 99-2078  
 
22 
 
argue that declaratory relief is necessary because they and 
others will invariably be subject to Time Warner's late fees in 
the future.  They argue that as long as Time Warner is permitted 
to charge these unlawful fees, customers face a Hobson's choice 
of paying the excessive late fees or having their cable service 
terminated.  They therefore maintain that the dispute is 
justiciable and a declaration that the late fee is illegal is 
appropriate. 
¶39 Time Warner counters that the controversy is not ripe 
for judicial determination.  It argues that imposition of a late 
fee is contingent upon these customers making payments late and 
on Time Warner demanding payments of the late fee from these 
customers.  Time Warner characterizes the customers' claims as 
uncertain because neither of these occurrences will necessarily 
transpire.  Therefore, it argues, the circuit court properly 
exercised its discretion in denying declaratory relief. 
                                                                                                                                                             
(d) An order requiring Time Warner to conduct appropriate 
and necessary studies to determine the actual or reasonably 
anticipated damages that Time Warner might incur solely as a 
result of late payments and/or late paying customers; 
(e) An order requiring Time Warner to disclose to its 
customers all information and facts discovered under the studies 
mentioned above;  
(f) An order requiring Time Warner to send a notice to all 
of its customers concerning the terms and conditions under which 
any late fee or penalty will be assessed in the future; and  
(g) A court order requiring Time Warner to refund to 
Plaintiffs and the Class Members all excessive late fees paid to 
Time Warner. 
No. 99-2078  
 
23 
 
¶40 The 
circuit court 
heard 
argument 
supporting and 
opposing Time Warner's motion to dismiss, but it decided to deny 
declaratory relief without an evidentiary hearing.  We recently 
articulated the standard by which appellate courts review a 
circuit court's decision whether to permit or deny declaratory 
relief:   
A decision to grant or deny declaratory relief 
falls within the discretion of the circuit court.  The 
circuit 
court's 
decision 
to 
grant 
[or 
deny] 
declaratory relief will not be overturned unless the 
circuit court erroneously exercised its discretion.  
This court will uphold a discretionary act if the 
circuit court "examined the relevant facts, applied a 
proper standard of law, and, using a demonstrated 
rational 
process, 
reached 
a 
conclusion 
that 
a 
reasonable judge could reach." 
Milwaukee Dist. Council 48 v. Milwaukee County, 2001 WI 65, ¶36, 
244 Wis. 2d 333, 627 N.W.2d 866 (citations omitted).   
¶41 The leading Wisconsin case on declaratory judgments is 
Loy v. Bunderson, 107 Wis. 2d 400, 320 N.W.2d 175 (1982).  Loy 
emphasized that a declaratory judgment is fitting when a 
controversy is justiciable.  Id. at 410.  A controversy is 
justiciable when the following factors are present: 
(1) A controversy in which a claim of right is 
asserted against one who has an interest in contesting 
it.  
(2) The controversy must be between persons whose 
interests are adverse.  
(3) The party seeking declaratory relief must have a 
legal interest in the controversy——that is to say, a 
legally protectible interest.  
(4) The issue involved in the controversy must be ripe 
for judicial determination.   
No. 99-2078  
 
24 
 
Id.  "If all four factors are satisfied, the controversy is 
'justiciable,' and it is proper for a court to entertain an 
action for declaratory judgment."  Miller Brands-Milwaukee v. 
Case, 162 Wis. 2d 684, 694, 470 N.W.2d 290 (1991). 
¶42 Looking at the record, the circuit court's discussion 
of the declaratory relief claim was very brief.  The court did 
not question that a bona fide controversy existed between 
adverse parties over a legally protectible interest in the 
validity of contractual terms.  In effect, it relied on the 
customers' failure to allege that they were suffering a present 
harm.  The court observed that none of the customers was 
currently faced with paying a $5.00 late fee ("no one asserted 
that I have a late bill fee[,] that I have not paid it and I 
don't intend to pay it").  Therefore, the court concluded, this 
issue was not "ripe enough," failing the fourth factor of the 
justiciability standard.  The court of appeals agreed with this 
conclusion, adding that "the customers' amended complaint asks 
this court to construe their rights 'in anticipation of an event 
that may never happen'——their failure to pay the cable bills on 
time and Time Warner's imposition of the five-dollar late fee."  
Putnam, 2001 WI App. at ¶25 (citations omitted). 
¶43 To the extent that the circuit court premised its 
decision solely on the lack of present harm to the three named 
customers, it did not apply a proper standard of law.  The 
purpose 
of 
the 
Uniform 
Declaratory 
Judgments 
Act 
(Wis. 
No. 99-2078  
 
25 
 
Stat. § 806.04),14 is to allow courts to anticipate and resolve 
identifiable, certain disputes between adverse parties.  See 
                                                 
14 Wisconsin Stat. § 806.04 provides, in pertinent part: 
(1) Scope.  Courts of record within their 
respective jurisdictions shall have power to declare 
rights, status, and other legal relations whether or 
not further relief is or could be claimed.  No action 
or proceeding shall be open to objection on the ground 
that a declaratory judgment or decree is prayed for.  
The declaration may be either affirmative or negative 
in form and effect; and such declarations shall have 
the force and effect of a final judgment or decree, 
except that finality for purposes of filing an appeal 
as of right shall be determined in accordance with s. 
808.03(1). 
(2) 
Power 
to 
construe, 
etc. 
 
Any 
person 
interested under a deed, will, written contract or 
other writings constituting a contract, or whose 
rights, status or other legal relations are affected 
by 
a 
statute, 
municipal 
ordinance, 
contract 
or 
franchise, 
may 
have 
determined 
any 
question 
of 
construction or validity arising under the instrument, 
statute, ordinance, contract or franchise and obtain a 
declaration of rights, status or other legal relations 
thereunder.  No party shall be denied the right to 
have declared the validity of any statute or municipal 
ordinance by virtue of the fact that the party holds a 
license or permit under such statutes or ordinances. 
(3) Before breach.  A contract may be construed 
either before or after there has been a breach 
thereof. 
 . . . . 
(6) Discretionary.  The court may refuse to 
render or enter a declaratory judgment or decree where 
such judgment or decree, if rendered or entered, would 
not terminate the uncertainty or controversy giving 
rise to the proceeding. 
 . . . . 
No. 99-2078  
 
26 
 
Wis. Stat. § 806.04(12); see also Lister v. Bd. of Regents of 
Univ. Wis. Sys., 72 Wis. 2d 282, 307, 240 N.W.2d 610 (1976).  
"The 
underlying 
philosophy 
of 
the 
[Act] 
is 
to 
enable 
controversies of a justiciable nature to be brought before the 
courts for settlement and determination prior to the time that a 
wrong has been threatened or committed."  Lister, 72 Wis. 2d at 
307 (emphasis added).  The Lister court went so far as to say 
that the "preferred view appears to be that declaratory relief 
is appropriate wherever it will serve a useful purpose."  Id.   
¶44 By definition, the ripeness required for a declaratory 
judgment is different from the ripeness required in other 
actions.  Milwaukee Dist. Council 48, 2001 WI 65, ¶41.  In State 
ex rel. Lynch v. Conta, 71 Wis. 2d 662, 239 N.W.2d 313 (1976), 
the court analyzed a declaratory judgment involving a forfeiture 
statute.  It declared that potential defendants "may seek a 
                                                                                                                                                             
(8) Supplemental relief.  Further relief based on 
a declaratory judgment or decree may be granted 
whenever 
necessary 
or 
proper. 
 
The 
application 
therefor shall be by petition to a court having 
jurisdiction to grant the relief.  If the application 
be deemed sufficient, the court shall, on reasonable 
notice, require any adverse party whose rights have 
been 
adjudicated by 
the 
declaratory judgment 
or 
decree, to show cause why further relief should not be 
granted forthwith. 
 . . . . 
(12) Construction.  This section is declared to 
be remedial; its purpose is to settle and to afford 
relief from uncertainty and insecurity with respect to 
rights, status and other legal relations; and is to be 
liberally construed and administered. 
No. 99-2078  
 
27 
 
construction of a statute or a test of its constitutional 
validity 
without 
subjecting 
themselves 
to 
forfeitures 
or 
prosecution." 
 
Id. 
at 
674. 
 Thus, 
a plaintiff seeking 
declaratory judgment need not actually suffer an injury before 
seeking 
relief 
under 
the 
declaratory 
judgment 
statute.  
Milwaukee Dist. Council 48, 2001 WI 65, ¶41.  What is required 
is that the facts be sufficiently developed to allow a 
conclusive adjudication.  Id.; Conta, 71 Wis. 2d at 674.  As we 
put it in Miller Brands, "the facts [must] be sufficiently 
developed to avoid courts entangling themselves in abstract 
disagreements."  Id. at 694 (citing Loy, 107 Wis. 2d at 412, 
414).  The facts on which the court is asked to make a judgment 
should not be contingent or uncertain, but not all adjudicatory 
facts must be resolved as a prerequisite to a declaratory 
judgment.  Id. at 694-95 (citing Loy, 107 Wis. 2d at 412).   
¶45 Time Warner acknowledges that declaratory judgments 
are permissible when the harm is only anticipatory, but it 
maintains that the circuit court's dismissal of the claims for 
declaratory and injunctive relief was nonetheless in accord with 
the ripeness requirements for justiciability.  It argues that 
the circuit court properly recognized that late-payment fees 
might never be imposed on these customers, because the customers 
themselves control whether they will be late in paying their 
monthly cable bills.  Time Warner asserts that this absence of 
certainty precludes conclusive adjudication and the controversy 
is not justiciable.  We disagree. 
No. 99-2078  
 
28 
 
¶46 In Loy, this court adopted the proposition that: "The 
imminence and practical certainty of the act or event in issue, 
or 
the 
intent, 
capacity, 
and 
power 
to 
perform, 
create 
justiciability as clearly as the completed act or event, and is 
generally easily distinguishable from remote, contingent, and 
uncertain events that may never happen."  Loy, 107 Wis. 2d at 
414 (quoting Borchard, Declaratory Judgments 60 (2d ed.)). Time 
Warner's imposition of a $5.00 fee for late payment is an 
imminent and practical certainty.  The plaintiffs allege that, 
on average, 10 to 15 percent of Time Warner's customers pay the 
late fee each month.  Time Warner offered no evidence that this 
trend will not continue.  The customers' allegations must be 
taken as true. 
¶47 Thus, the central issue is whether Time Warner has the 
legal right to impose a $5.00 late-payment fee on its customers 
under their contracts.  If it does, the controversy is over.  It 
if does not, additional proceedings will be required.  This 
issue is not hypothetical, abstract, or remote.  It is real, 
precise, and immediate.  The circuit court has the means to 
obtain whatever additional facts are necessary to determine 
conclusively whether Time Warner's use of the $5.00 late fees is 
lawful.  The matter, when addressed, will be based purely on the 
legal validity of the fee commonly imposed on a set of Time 
Warner's cable television customers. 
¶48 If the issue is viewed as the construction or validity 
of a contract provision, it falls expressly within the scope of 
the declaratory judgment statute:  
No. 99-2078  
 
29 
 
Any 
person 
interested 
under 
a . . . written 
contract . . . or whose rights, status or other legal 
relations are affected by a . . . contract . . . may 
have 
determined any 
question of 
construction or 
validity 
arising under 
the . . . contract . . . and 
obtain a declaration of rights, status or other legal 
relations thereunder. 
Wis. Stat. § 806.04(2) (emphasis added). 
¶49 The court of appeals dismissed the force of this 
language, stating that "it is clear from the amended complaint 
that the customers are seeking much more than a construction of 
the validity of the contract or a declaration of their rights 
thereunder."  Putnam, 2001 WI App 196, ¶26.  It pointed to that 
part of the declaratory and equitable relief claim that seeks 
damages, then remarked that "the remaining claims seek court 
orders requiring Time Warner to perform various types of tasks 
(e.g. 
conducting 
studies, 
disclosing 
certain 
information, 
providing notice to customers, etc.).  These requests are well 
beyond 
the 
scope 
of 
the 
Uniform 
Declaratory 
Judgments 
Act . . . ."  Id. 
¶50 The 
inconspicuous 
"etc" in 
the court's analysis 
includes the principal claims for relief under § 806.04——a 
declaration of rights under the contract and injunctive relief 
for the future.15  These are precisely the types of claims that 
the Uniform Declaratory Judgments Act is intended to address.  A 
circuit court's declaration would resolve uncertainty about the 
                                                 
15 See supra note 12. 
No. 99-2078  
 
30 
 
lawfulness of the late-payment fees in Time Warner's cable-
programming contracts.16 
¶51 Finally, Time Warner argues that the customers would 
have an adequate remedy at law if they challenged a late-payment 
fee by paying it under protest and then suing for recovery of 
the payment.  Under the circumstances, this alternative would be 
time-consuming, costly, and impractical.  In any event, the 
existence of an adequate remedy at law does not necessarily 
obviate the propriety of declaratory relief.  The fact that 
relief may be sought is but one factor to be weighed in deciding 
whether declaratory judgment is appropriate.  Lister, 72 
Wis. 2d at 307 ("declaratory relief is appropriate wherever it 
will serve a useful purpose, and the fact that another remedy 
                                                 
16 It is true that the nature of some of the relief sought 
by the customers in their declaratory judgment action extends 
beyond the scope of the Uniform Declaratory Judgment Act.  For 
example, one of the claims for declaratory relief is an 
equitable claim for refund of excessive late fees already paid.  
According to the court of appeals, "These claims amount to an 
action for damages and are not the proper subject of an action 
for declaratory judgment.  Putnam, 2001 WI App 196, ¶26 (citing 
F. Rosenberg Elevator Co. v. Goll, 18 Wis. 2d 355, 363, 118 
N.W.2d 858 (1963) ("It is not the role of declaratory judgment 
to take the place of an action for damages.")).   
Nevertheless, the justicability of a declaratory judgment 
claim hinges on an inspection of all the claims for relief 
sought.  If one or more of the claims for relief are properly 
justiciable through a declaratory judgment, the action should 
proceed.  See Wis. Stat. § 806.04(1) ("Courts of record within 
their respective jurisdictions shall have power to declare 
rights, status, and other legal relations whether or not further 
relief is or could be claimed.") (Emphasis added.) 
No. 99-2078  
 
31 
 
exists is only one factor to consider in determining whether to 
entertain the action").   
¶52 In sum, the circuit court's denial of a hearing on the 
customers' claims for declaratory relief resulted from a 
misapplication of the ripeness requirement for declaratory 
actions.  Under this court's standards for justiciability, the 
present action for declaratory relief is ripe for judicial 
determination.  Because the circuit court misapplied the 
governing 
law 
by 
dismissing 
the 
customers' 
claims 
for 
declaratory relief on the basis that it did, we conclude that 
the circuit court erroneously exercised its discretion. 
III.  CONCLUSION 
¶53 We conclude that 
the voluntary payment doctrine 
precludes the customers in this action from recovering the 
allegedly unlawful portion of the monthly late-payment fee that 
they paid without protest to Time Warner.  However, we also 
conclude that the circuit court erroneously exercised its 
discretion in barring the customers' claim for declaratory 
relief from Time Warner's future imposition of the $5.00 late-
payment fee.  The issue to be decided is sufficiently clear and 
imminent for a court to conclusively determine legal rights 
under this provision of the contract.  Therefore, a declaration 
as to the legality of the future imposition of Time Warner's 
late-payment fee is appropriate. 
By the Court.—The decision of the court of appeals is 
affirmed in part, reversed in part, and the cause is remanded to 
the circuit court. 
No. 99-2078  
 
32 
 
 
 
 
No.  99-2078.wab 
 
1 
 
¶54 WILLIAM 
A. 
BABLITCH, 
J.   (concurring 
in 
part, 
dissenting in part).  The majority refuses to allow a claim 
based on an unlawful liquidated damages provision to serve as an 
exception to the voluntary payment doctrine.  In other words, 
the majority holds that absent fraud, duress, or mistake of 
fact, 
the 
voluntary 
payment 
doctrine 
prohibits 
recovery 
notwithstanding the existence of an unlawful liquidated damages 
provision.  I disagree and accordingly respectfully dissent to 
parts I and II A of the majority opinion.  I join part II B of 
the majority opinion.  
¶55 Time Warner is a monopolist for cable television 
programming in the Milwaukee area.  If customers do not buy its 
product, the customers are free to go elsewhere.  Unfortunately 
for the customers, there is no "elsewhere" to go for cable 
services.  As a general proposition, customers in a government 
created monopoly deserve special protection.     
¶56 For purposes of this action, we must assume that Time 
Warner charges a late fee of $5.00, which in fact costs them 
$0.38 to $0.48.  The $5.00 fee is written into the contract as 
liquidated damages.  "Late fees" are not subject to the rigid 
controls imposed upon Time Warner by the cable commission——
controls which are the price Time Warner pays for its monopoly.  
If customers do not pay the late fee, eventually they are 
presumably cut off. 
¶57 As stated above, but it is worth repeating, for 
purposes of this case at this time in the proceedings, we must 
assume the truthfulness of all the petitioner's allegations. 
No.  99-2078.wab 
 
2 
 
¶58 Thus, we must assume that the cost to Time Warner was 
$0.38 to $0.48, not the $5.00 it charged.  We must assume this 
$5.00 fee does not bear a reasonable relationship to the actual 
cost.  We must assume that the late fee is already incorporated 
into the basic cable rates. 
¶59 In sum, we must assume the charging of a $5.00 late 
fee is unreasonable and unconscionable, and accordingly an 
unlawful liquidated damages provision. 
¶60 Yet the majority says there is nothing the customer 
can do because the fee was paid by the customer without protest. 
¶61 Why should a customer protest the payment of a fee if 
it has no reason at the time of payment to believe that it is 
unreasonable and/or unconscionable?  If that is the law, and the 
majority says it is, then all payees of all late fees pursuant 
to prior agreements regarding late fee payments, whether to 
banks, credit cards, bills for services, and the like, must 
automatically protest at the time of payment or lose the right 
to contest it.  That is, of course, absurd.  Yet it is the 
requirement set out by the majority. 
¶62 G. Heileman Brewing Co. v. City of La Crosse, 105 Wis. 
2d 152, 312 N.W.2d 875 (Ct. App. 1981), relied upon by the 
majority, is simply inapplicable.  In Heileman, the government 
was the defendant.  Here, the entity sued is in the private 
sector.  In Heileman, the government was not accused of any 
wrongful conduct.  Here, Time Warner is accused of wrongful 
conduct.  In Heileman, the claim was unduly delayed.  Here, the 
claim is within the statutes of limitation. 
No.  99-2078.wab 
 
3 
 
¶63 Wassenaar v. Panos, 111 Wis. 2d 518, 525, 331 N.W.2d 
357 (1983), teaches that even though the circuit court's 
determination of the validity of a stipulated liquidated damages 
clause is a question of law, that question is derived from a 
resolution of disputed facts or references.  Most significantly, 
Wassenaar teaches:  "In deciding whether a stipulated damages 
clause is valid, then, the trial judge should inquire into all 
relevant circumstances, including such matters as the existence 
and extent of the anticipated and actual injury to the 
nonbreaching party."  Id.  The majority, in sharp contrast to 
the mandate in Wassenaar, allows no inquiry. 
¶64 Furthermore, the majority ignores the analysis put 
forth in Wassenaar which articulates three questions a circuit 
court 
should 
consider 
in 
determining 
the 
validity 
of 
a 
liquidated damage provision:  "(1) Did the parties intend to 
provide for damages or for a penalty? (2) Is the injury caused 
by the breach one that is difficult or incapable of accurate 
estimation at the time of contract? and (3) Are the stipulated 
damages a reasonable forecast of the harm caused by the breach?"  
Id. at 529-30.  (Footnotes omitted). 
¶65 These three questions, in my view, are quite distinct 
from the inquiries made in a voluntary payment doctrine case not 
involving liquidated damages. 
¶66 Here, 
again 
assuming 
the 
truthfulness 
of 
the 
assertions, Time Warner flunks at least two of the three.  
First, there was no way for the customer to accurately estimate 
the injury to Time Warner when paying late.  Second, the 
No.  99-2078.wab 
 
4 
 
stipulated damage of $5.00 is not a reasonable forecast of the 
harm caused, $0.38 to $0.48. 
¶67 The implications of this case are very significant to 
the consumer and the private sector.  The majority holds that a 
late fee paid by a consumer pursuant to a private agreement 
regarding late fee payment without protest cannot in the absence 
of fraud, duress, or mistake of fact be challenged at a later 
date.  I would hold that unlawful liquidated damages are an 
exception to the voluntary payment doctrine.  I respectfully 
dissent in part. 
¶68 I am authorized to state that Chief Justice SHIRLEY S. 
ABRAHAMSON joins in this opinion. 
 
No.  99-2078.dss 
 
1 
 
¶69 DIANE S. SYKES, J.   (dissenting in part).  I agree 
completely with the majority opinion on the issue of the 
voluntary payment doctrine's application to this case, and 
therefore join the majority in Parts I and II A, in which the 
court affirms the court of appeals' decision affirming the 
circuit court's dismissal of the plaintiffs' claims for monetary 
relief in counts I-VIII of the amended complaint.  I disagree, 
however, with the majority's conclusion in Part II B that the 
circuit court erroneously exercised its discretion in dismissing 
count IX, the plaintiffs' claim for declaratory relief. 
¶70 I conclude that the court of appeals properly affirmed 
the circuit court's conclusion that the case was not suitably 
postured for declaratory judgment, in that the claim was not 
ripe for judicial determination.  I would therefore affirm the 
court of appeals' decision in its entirety. 
¶71 The decision to grant or deny declaratory relief is 
entrusted to the sound discretion of the circuit court.  Jones 
v. Secura Ins. Co., 2002 WI 11, ¶19, 249 Wis. 2d 623, 638 N.W.2d 
575; Milwaukee Dist. Council 48 v. Milwaukee County, 2001 WI 65, 
244 Wis. 2d 333, 351, 627 N.W.2d 866; Loy v. Bunderson, 107 Wis. 
2d 400, 407, 320 N.W.2d 175 (1982). "While, as in all 
discretionary acts of a court, reasonable persons may sometimes 
differ in the outcome, all that this court need find to sustain 
a discretionary act is that the trial court examined the 
relevant facts, applied a proper standard of law, and, using a 
demonstrated rational process, reached a conclusion that a 
reasonable judge could reach."  Loy, 107 Wis. 2d at 414-15.  
No.  99-2078.dss 
 
2 
 
Applying this deferential standard of review here, I conclude 
that the circuit court's discretionary decision to dismiss the 
claim for declaratory relief must be upheld. 
¶72 Though the authority to declare rights under the 
Uniform Declaratory Judgment Act is broad, it is not unlimited 
in scope.  Sipl v. Sentry Ind. Co., 146 Wis. 2d 459, 464, 431 
N.W.2d 685 (Ct. App. 1988).  The standards for determining the 
threshold justiciability of a claim for declaratory relief, set 
forth in the majority opinion at ¶40, assure that courts will 
not become entangled in abstract disagreements or be called upon 
to resolve contingent claims or render essentially advisory 
rulings.  Miller Brands-Milwaukee v. Case, 162 Wis. 2d 684, 694-
95, 470 N.W.2d 290 (1991).  The fourth requirement of the Loy 
justiciability equation——the requirement of ripeness——guarantees 
that declaratory judgment is not used as a procedural tool for 
the adjudication of hypothetical issues.  Klaus v. Vander 
Heyden, 106 Wis. 2d 353, 365, 316 N.W.2d 664 (1982).  Courts 
will not entertain actions for declaratory judgment in order to 
"determine future rights in anticipation of an event that may 
never happen."  Selective Ins. Co. v. Michigan Mut. Liab. Ins. 
Co., 36 Wis. 2d 402, 405, 153 N.W.2d 523 (1967). 
¶73 The circuit court in this case determined that the 
claim for declaratory relief was essentially speculative in 
nature and therefore not ripe.  The court noted that the 
complaint did not contain an allegation sufficient to support a 
ripe declaratory claim because "no one asserted that I have a 
No.  99-2078.dss 
 
3 
 
late bill fee, that I have not paid it, and I don't intend to 
pay it, and I've not paid the late fee as well." 
¶74 The majority construes this conclusion on the part of 
the circuit court as an error of law, interpreting it as a 
requirement of present injury.  I disagree.  The circuit court 
was 
simply 
concluding 
that 
the 
amended 
complaint 
was 
insufficient 
because 
it 
lacked 
allegations 
of 
even 
an 
anticipatory injury, and therefore the declaratory judgment 
claim, at least as it was then pleaded, was premised on a 
contingent event that may never happen.  The circuit court noted 
that had the plaintiffs simply alleged that they had a late or 
unpaid bill on which they had been assessed or were about to be 
assessed an alleged illegal late fee, then "the plaintiff would 
be entitled to a declaratory judgment and decision perhaps on 
injunctive relief.  But they haven't done that." 
¶75 I cannot agree with the majority's conclusion that the 
circuit court erroneously exercised its discretion in dismissing 
the declaratory judgment claim.  While this court might disagree 
with the circuit court's resolution of the ripeness issue, the 
record nevertheless reflects that the circuit court examined 
relevant facts, applied a proper standard of law, and reached a 
conclusion that a reasonable judge could reach.  I would affirm 
the court of appeals on all issues.  Accordingly, I respectfully 
dissent from Part II B of the majority opinion.   
¶76 I am authorized to state that Justices  JON P. WILCOX 
and N. PATRICK CROOKS join this dissenting opinion.   
 
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