Title: Kimble v. Land Concepts, Inc.

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2014 WI 21 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2011AP1514   
COMPLETE TITLE: 
Robert L. Kimble and Judith W. Kimble, 
          Plaintiffs, 
     v. 
Land Concepts, Inc., John E. Stevenson and Jane 
E.  
Stevenson, Trustees of the John E. and Jane E. 
Stevenson  
Revocable Trust, Dorene E. Dempster and Mark F. 
Herrell, 
          Defendants, 
John E. Stevenson and Jane E. Stevenson, 
          Defendants-Respondents, 
First American Title Insurance Company, 
          Defendant-Appellant-Petitioner.   
 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
Reported at 345 Wis. 2d 60, 823 N.W.2d 839 
(Ct. App. 2012 – Unpublished)  
 
 
OPINION FILED: 
April 22, 2014 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
December 19, 2013   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Door 
 
JUDGE: 
D. Todd Ehlers 
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
ABRAHAMSON, C.J., BRADLEY, J., dissent. (Opinion 
filed.)   
 
NOT PARTICIPATING: PROSSER, J., did not participate.    
 
 
 
ATTORNEYS: 
 
For the defendant-appellant-petitioner, there were briefs 
by J. Bushnell Nielsen, Rebecca Leair, and Reinhart Boerner Van 
Deuren S.C., Waukesha, and oral argument by J. Bushnell Nielsen. 
 
For the defendants-respondents, there was a brief by David 
H. Weber, T. Wickham Schmidt, and Conway, Olejniczak & Jerry, 
S.C., Green Bay, and oral argument by David H. Weber. 
 
 
2 
An amicus curiae brief was filed by James A. Friedman, 
Kerry L. Gabrielson, and Godfrey & Kahn, S.C., Madison, on 
behalf of the Wisconsin Insurance Alliance, the Wisconsin Civil 
Justice Council, Inc., and Wisconsin Manufacturers & Commerce.  
 
 
 
 
2014 WI 21
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2011AP1514 
(L.C. No. 
2009CV188) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
 
Robert L. Kimble and Judith W. Kimble, 
 
          Plaintiffs, 
 
     v. 
 
Land Concepts, Inc., John E. Stevenson and Jane 
E. Stevenson, Trustees of the John E. and Jane 
E. Stevenson Revocable Trust, Dorene E. 
Dempster and Mark F. Herrell, 
 
          Defendants, 
 
John E. Stevenson and Jane E. Stevenson, 
 
          Defendants-Respondents, 
 
First American Title Insurance Company, 
 
          Defendant-Appellant-Petitioner. 
 
FILED 
 
APR 22, 2014 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
REVIEW of a decision of the Court of Appeals.   Reversed 
and cause remanded.   
 
¶1 
ANNETTE KINGSLAND ZIEGLER, J.   This is a review of an 
unpublished decision of the court of appeals, Kimble v. Land 
Concepts, Inc., No. 2011AP1514, unpublished slip op. (Wis. Ct. 
No. 
2011AP1514   
 
2 
 
App. Oct. 11, 2012), affirming the judgment of the Door County 
Circuit Court,1 upholding a jury award of punitive damages 
against 
First 
American 
Title 
Insurance 
Company 
("First 
American"). 
¶2 
First American argues that the punitive damages award 
against it was excessive and violated its right to due process 
under the United States and Wisconsin constitutions.2 
¶3 
John E. and Jane E. Stevenson ("Stevensons")3 argue 
that First American had no right to appeal the punitive damages 
award because it filed its post-verdict motion late.  The 
Stevensons also argue that the award was reasonable in light of 
First American's bad faith conduct, and the harm that they might 
have suffered as a result of that bad faith.  The Stevensons 
further contend that punitive damages were appropriate because 
First American's conduct needed to be deterred. 
¶4 
We conclude that the punitive damages award in this 
case was excessive and deprived First American of its right to 
due process.  We therefore reverse the court of appeals' 
                                                 
1 The Honorable D. Todd Ehlers presided. 
2 First American's petition for review addressed four 
issues.  We granted review, however, solely on the issue of 
whether the punitive damages award was unconstitutionally 
excessive. 
3 The original plaintiffs in this action, Robert L. Kimble 
and Judith W. Kimble, assigned their rights under their title 
insurance policy, including any claims against First American, 
to the Stevensons as part of a settlement agreement. 
No. 
2011AP1514   
 
3 
 
decision and remand this case to the circuit court for entry of 
a judgment against First American in the amount of $239,738.49. 
I. 
BACKGROUND FACTS 
¶5 
On October 26, 2004, Robert L. Kimble and Judith W. 
Kimble ("Kimbles") purchased a lakefront lot located in the Town 
of Nasewaupee in Door County ("Kimble Lot") from Dorene Dempster 
("Dempster") and Mark Herrell ("Herrell").4  A private cut-off 
road that crossed the property immediately to the west provided 
access to the Kimble Lot.  That property was owned by Land 
Concepts, Inc. ("Land Concepts"). 
¶6 
The deed executed by Dempster and Herrell conveying 
the Kimble Lot to the Kimbles warranted that the property was 
benefitted by two easements.  One easement purported to grant 
the Kimble Lot use of a private driveway connecting it to County 
Highway M across property to the north ("North Easement").  That 
private driveway had not been used in many years at the time of 
the sale.  The other easement purported to grant the Kimble Lot 
access to County Highway M across Land Concepts' property ("West 
Easement").5  It is undisputed that the cut-off road was not 
within the boundaries of either of these easements. 
¶7 
On October 27, 2004, First American issued the Kimbles 
a title insurance policy for the Kimble Lot.  The policy 
                                                 
4 Dempster and Herrell had originally purchased the lot from 
the Stevensons.  All were initially defendants in the Kimbles' 
lawsuit. 
5 The West Easement traversed property belonging only to 
Land Concepts, while the North Easement traversed property 
belonging to both Land Concepts and other owners. 
No. 
2011AP1514   
 
4 
 
obligated First American to defend and indemnify the Kimbles for 
any 
covered 
loss, 
including 
losses 
resulting 
from 
"[u]nmarketability of the title" and "[l]ack of a right of 
access to and from the land."  The policy did not insure any 
specific route of access. 
¶8 
In early 2008, the Kimbles listed their property for 
sale with a real estate agent.6  On March 5, 2008, the Kimbles' 
agent received a letter from Land Concepts stating that the 
Kimbles "do not own——and cannot convey——any access rights to 
County Highway M" from the Kimble Lot.  The letter instructed 
the agent to make prospective purchasers of the Kimble Lot aware 
of lack of access rights "[i]n order to avoid possible future 
misunderstandings and/or confusion."  On March 17, 2008, the 
Kimbles' attorney contacted the Kimbles' local insurance agent, 
Marilyn DeNamur ("DeNamur"), about the dispute.  DeNamur 
forwarded the matter to Donald Schenker ("Schenker"), an 
assistant vice president at First American. 
¶9 
On March 18, 2008, DeNamur provided Schenker with the 
deeds and other recorded documents purportedly granting the 
North and West Easements to the Kimbles' predecessors in title.  
In a follow-up message to Schenker on March 28, DeNamur noted 
that there appeared to be a problem with the deeds purporting to 
grant and convey the North Easement.  DeNamur asked Schenker 
                                                 
6 The precise date of the real estate listing is not a part 
of the record. 
No. 
2011AP1514   
 
5 
 
whether she should "continue to dig for more documentation?"  
Schenker never asked for more research.7 
¶10 On March 31, 2008, Schenker, on behalf of First 
American, sent the Kimbles a letter which addressed the access 
issue.  Schenker indicated in his letter that he believed the 
West Easement was defective.8  Schenker asserted, however, that 
the North Easement continued to provide the Kimble Lot access to 
the highway, and because the title remained as insured, First 
American had no duty to intervene in the dispute.  In his 
letter, Schenker described the chain of title he claimed 
supported the North Easement, but made no mention of the 
problems identified by DeNamur. 
¶11 On May 27, 2008, the Kimbles forwarded Schenker a copy 
of a letter they intended to send to Land Concepts asserting 
their right to use the cut-off road.  The Kimbles asked Schenker 
whether the letter jeopardized their title insurance policy.  On 
May 28, 2008, Schenker assured the Kimbles that it did not, 
again implicitly asserting that another right of access existed. 
¶12 On June 13, 2008, the Kimbles received a response 
letter from Land Concepts, wherein Land Concepts threatened to 
"close the access over [its] property" if the dispute was not 
                                                 
7 The record is devoid of any direct response from Schenker 
to DeNamur's March 28, 2008 e-mail message. 
8 Specifically, Schenker wrote that the document recording 
the easement failed to identify the property benefitted, and 
thus failed to comply with Wis. Stat. § 706.02(1) (2009-10).  
All subsequent references to the Wisconsin Statutes are to the 
2009-10 version unless otherwise indicated. 
No. 
2011AP1514   
 
6 
 
"promptly resolved."  On June 18, 2008, the Kimbles contacted 
Schenker regarding the threatened closure.  The Kimbles asked 
Schenker whether First American would insure the North Easement 
under the title policy if the Kimbles constructed a new driveway 
following the route of that easement. 
¶13 On June 25, 2008, Schenker reiterated to the Kimbles 
that their title policy did not insure any particular route of 
access.  Schenker again asserted that the North Easement 
provided access and stated, "[w]hether there is some legal 
defense to prevent the Kimbles from using it, which falls under 
some exclusion or exception in the policy, we do not know."  
Schenker further recommended that the Kimbles have a survey of 
the North Easement performed before constructing any driveway. 
¶14 The 
Kimbles 
continued 
to 
market 
their 
property 
throughout 2008, relying on Schenker's assurances that it had 
good access to the highway.  Land Concepts continued to dispute 
the Kimbles' right of access, but did not follow through on its 
threat to physically close the cut-off road. 
¶15 On January 12, 2009, the Kimbles received a cash offer 
to purchase their property.  The sale was made contingent on the 
access issue being resolved.  Despite an extension on the 
original 30-day time limit, the Kimbles were unable to negotiate 
a resolution with Land Concepts and lost the sale. 
II. 
PROCEDURAL POSTURE 
¶16 On June 3, 2009, the Kimbles filed suit against Land 
Concepts and the Stevensons.  The Kimbles sought a declaration 
that the North Easement was valid and sought a prescriptive 
No. 
2011AP1514   
 
7 
 
easement for their use of the cut-off road.  The Kimbles also 
claimed that Land Concepts, in recording the West Easement, had 
slandered the title to the Kimbles' property. 
¶17 On October 23, 2009, the Kimbles amended their 
complaint adding breach of warranty claims against Dempster, 
Herrell, and the Stevensons, and a breach of contract claim 
against First American for failing to defend the title to their 
property. 
¶18 On July 21, 2010, the Kimbles settled their claims 
against all the defendants except First American.  As part of 
the settlement, the Kimbles and the Stevensons paid Land 
Concepts $40,000 to secure an easement over the route of the 
existing cut-off road.  The Stevensons paid an additional 
$10,000 to the Kimbles for an assignment of the Kimbles' rights 
under the title insurance policy, including any claims against 
First American. 
¶19 On August 6, 2010, the Stevensons filed a cross-claim 
against First American, alleging breach of contract and breach 
of fiduciary duty and bad faith in First American's refusal to 
defend the title to the Kimble Lot. 
¶20 On December 1, 2010, First American filed a motion for 
declaratory and summary judgment, asking the court to dismiss 
the Stevensons' cross-claim.  First American argued that the 
Stevensons were not "insureds," and thus had no rights under the 
title policy.  First American also contended that the Kimbles 
were not permitted to settle their claims against other 
No. 
2011AP1514   
 
8 
 
defendants without the written consent of First American.  First 
American asserted that the title policy was void as a result. 
¶21 The Stevensons argued that the Kimbles were permitted 
to assign their rights under the title policy, and that the 
partial settlement was proper under the terms of the insurance 
contract.  The Stevensons also asserted that, to the extent 
summary judgment was warranted, it should be granted against 
First American on the Stevensons' breach of contract claim. 
¶22 On January 18, 2011, the circuit court denied First 
American's motion for declaratory and summary judgment.  The 
court concluded that the assignment of rights from the Kimbles 
to the Stevensons was proper and that there were issues of fact 
to be tried regarding the Stevensons' breach of contract and 
breach of fiduciary duty and bad faith claims. 
¶23 On February 4, 2011, the Stevensons filed a motion in 
limine which asked the court to exclude any evidence of the 
monetary terms of the settlement agreements between the Kimbles 
and the other defendants. 
¶24 On February 21, 2011, First American filed a motion in 
limine asking the court to exclude evidence that the Kimbles' 
title was unmarketable as a result of the access problems.  
First American argued that, while the access issues might have 
impaired the value of the property, they did not constitute a 
defect in the title. 
¶25 On March 1, 2011, the circuit court granted the 
Stevensons' motion in limine to exclude evidence of the terms of 
the settlement between the Kimbles and the other defendants.  
No. 
2011AP1514   
 
9 
 
Additionally, the circuit court denied First American's motion 
in limine to exclude evidence of unmarketability.  In denying 
First American's motion, the court determined that the issue of 
marketability was a legal question to be determined by the court 
prior to trial.  The court concluded that title to the Kimble 
Lot was rendered unmarketable by the access dispute.  As a 
result, the court concluded that coverage was triggered under 
the title insurance policy.  The court determined that it was 
for the jury to decide whether First American's decision not to 
defend the Kimbles under the policy constituted breach of 
contract and breach of fiduciary duty and bad faith. 
¶26 On March 2, 2011, the jury trial began.  At trial, the 
Stevensons presented evidence that First American was obligated 
to defend the Kimbles' title and failed to do so.  The 
Stevensons further presented evidence that First American knew 
the North Easement was defective and concealed that information 
from the Kimbles.  First American presented evidence that it had 
a good faith belief that the North Easement provided access, and 
that as a result, its failure to disclose the defect to the 
Kimbles was merely a mistake.9 
¶27 On March 3, 2011, the jury returned a verdict in favor 
of the Stevensons.  The jury found that First American breached 
                                                 
9 As we have granted review only on the legal issue of 
whether the punitive damages award in this case was excessive, 
this opinion does not provide a detailed description of the 
arguments presented at trial.  The evidence in the record is 
assumed to be sufficient to support the jury's findings in all 
respects except the size of the punitive damages award. 
No. 
2011AP1514   
 
10 
 
its contract and exercised bad faith in refusing to defend the 
Kimbles' title.  The jury awarded the Stevensons $50,000 in 
compensatory damages for the breach of contract, and $1,000,000 
in punitive damages to punish First American's bad faith. 
¶28 On March 24, 2011, First American filed three motions 
after the verdict with the circuit court.10  Initially, First 
American asked the court, pursuant to Wis. Stat. § 805.14(5)(c), 
to reduce the compensatory damages award.  Next, First American 
asked the court to change the jury's answer to the bad faith 
question to "no" and delete the jury's punitive damages award.  
First American asserted that there was insufficient evidence 
supporting the findings.  Finally, First American asked the 
court, in the alternative, to set aside the punitive damages 
award, which First American argued was excessive, and order a 
new trial on damages. 
¶29 The Stevensons opposed First American's post-verdict 
motions.  The Stevensons argued that the jury's award was 
appropriate, 
and 
that 
First 
American's 
conduct 
justified 
punitive damages.  Further, the Stevensons argued that the 
jury's punitive damages award was not excessive. 
¶30 On June 14, 2011, the circuit court granted First 
American's motion regarding the compensatory damages award, 
reducing it to $29,738.49.  The court denied First American's 
                                                 
10 The Stevensons argue that First American waived its right 
to appeal the punitive damages award by filing its post-verdict 
motions late.  See Wis. Stat. § 805.16(1).  We address this 
argument in part IV(A) of this opinion. 
No. 
2011AP1514   
 
11 
 
other motions, however, allowing the bad faith finding and the 
punitive damages award to stand.  The court then entered 
judgment against First American in the amount of $1,029,738.49. 
¶31 On June 29, 2011, First American filed its notice of 
appeal.  On July 11, 2011, First American filed a motion with 
the circuit court requesting the court stay the effect of the 
judgment pending appeal.  On August 3, 2011, the circuit court 
granted First American's motion. 
¶32 Before the court of appeals, First American made four 
arguments.  First, it argued that the Kimbles were not permitted 
to assign their rights under the title insurance policy to the 
Stevensons.  Second, First American argued that the circuit 
court improperly determined that coverage under the policy was 
invoked prior to trial.  Third, First American argued that there 
was insufficient evidence to support the jury's finding of bad 
faith.  Finally, First American argued that the punitive damages 
award was excessive.11 
¶33 The Stevensons argued that the Kimbles' assignment of 
their rights under the insurance policy was valid, and that the 
circuit court properly found coverage under the title policy as 
a matter of law.  The Stevensons also contended that First 
                                                 
11 First American also argued that the compensatory damages 
award should be further reduced.  Because this argument was not 
raised in First American's post-verdict motion, however, the 
court of appeals declined to address the issue.  Kimble v. Land 
Concepts, Inc., No. 2011AP1514, unpublished slip op., ¶37 (Wis. 
Ct. App. Oct. 11, 2012) (citing Segall v. Hurwitz, 114 
Wis. 2d 471, 489, 339 N.W.2d 333 (Ct. App. 1983)). 
No. 
2011AP1514   
 
12 
 
American's conduct supported the jury's finding of bad faith, 
and that the punitive damages award was not excessive. 
¶34 On October 11, 2012, the court of appeals affirmed the 
circuit court.  Kimble, No. 2011AP1514, slip op., ¶1.  First, 
the court of appeals concluded that the Kimbles were permitted 
to assign their rights under the title policy to the Stevensons, 
and that they had not violated the terms of the policy in 
agreeing to a partial settlement.  Id., ¶¶16-17.  Second, the 
court of appeals affirmed the circuit court's determination 
that, as a matter of law, there was coverage under the title 
policy.  Id., ¶¶24-28.  Third, the court appeals affirmed the 
circuit court's determination that the jury's finding of bad 
faith was supported by sufficient evidence.  Id., ¶¶33-35.  
Finally, the court of appeals summarily affirmed the jury's 
punitive damages 
award, finding First American's argument 
regarding excessiveness of the award to be "insufficiently 
developed."  Id., ¶41.12 
                                                 
12 Given that the availability of "'meaningful and adequate 
review by the trial court' and subsequent appellate review" of 
punitive damages awards is necessary to ensure that such awards 
are not imposed in an arbitrary manner, see Honda Motor Co., 
Ltd. v. Oberg, 512 U.S. 415, 420 (1994), the court of appeals' 
lack of analysis is remarkable.  We take this opportunity to 
remind courts, both trial and appellate, of their obligation to 
ensure that punitive damages awards comply with due process. 
No. 
2011AP1514   
 
13 
 
¶35 On December 28, 2012, First American petitioned this 
court for review, which we granted on July 18, 2013.13 
¶36 On September 3, 2013, the Stevensons filed a motion 
for summary disposition in this court, arguing that by filing 
its post-verdict motion late, First American had waived its 
right to appellate review.  See Wis. Stat. §§ 805.14(5) and 
805.15(1).  We held the motion in abeyance.14 
III. STANDARD OF REVIEW 
¶37 "[T]he constitutional issue of punitive damages merits 
de novo review."  Trinity Evangelical Lutheran Church & Sch.-
Freistadt v. Tower Ins. Co., 2003 WI 46, ¶47, 261 Wis. 2d 333, 
661 N.W.2d 789 (citing Cooper Indus., Inc. v. Leatherman Tool 
Grp., Inc., 532 U.S. 424, 431 (2001)).  "[I]n determining 
whether a jury's award [is] excessive, . . . the reviewing court 
properly review[s] the entire record 'ab inito' . . . ."  Id., 
¶48 (citing Mgmt. Computer Servs. v. Hawkins, Ash, Baptie & Co., 
206 Wis. 2d 158, 192 n.32, 557 N.W.2d 67 (1996)). 
                                                 
13 Because we granted review solely on the issue of whether 
the punitive damages award was excessive, this opinion assumes, 
without deciding, that the assignment was valid, that there was 
coverage under the insurance policy, and that the jury's finding 
of bad faith was supported by the evidence. 
14 In response to the Stevensons' motion for summary 
disposition, First American filed a motion to supplement the 
record, purporting to show that its post-verdict motion was 
filed timely, and a motion to strike the Stevensons' reply brief 
on the motion for summary disposition.  The motion for summary 
disposition, as well as these additional motions are rendered 
moot by our decision and thus are not addressed. 
No. 
2011AP1514   
 
14 
 
¶38 We recognize that our prior case law, particularly 
Jacque v. Steenberg Homes, Inc., 209 Wis. 2d 605, 563 N.W.2d 154 
(1997), has created confusion with respect to the standard of 
review in punitive damages cases.  Jacque, however, predates 
both Cooper, wherein the United States Supreme Court clarified 
that de novo is the appropriate standard of review, and Trinity, 
wherein this court explicitly adopted that standard.  While 
judges "serve as gatekeepers before sending a question on 
punitive damages to the jury," Strenke v. Hogner, 2005 WI 25, 
¶40, 279 Wis. 2d 52, 694 N.W.2d 296,15 once the issue of punitive 
damages is properly before the jury, its decision to award 
punitive damages is accorded deference.  The size of the award, 
however, is subject to de novo review to ensure it accords with 
the constitutional limits of due process.  Trinity, 261 
Wis. 2d 333, ¶¶47-49. 
IV. 
ANALYSIS 
A. Post-Verdict Motion 
¶39 As an initial matter we address the argument, raised 
by the Stevensons in their motion for summary disposition, that 
First American lost its right to appeal the punitive damages 
award when it failed to timely file its post-verdict motion 
under Wis. Stat. § 805.16(1). 
                                                 
15 Strenke v. Hogner interpreted Wis. Stat. § 895.85(3) 
(2001-02), the predecessor to the current punitive damages 
statute.  2005 WI 25, ¶2, 279 Wis. 2d 52, 694 N.W.2d 296; see 
also Wis. Stat. § 895.043(3). 
No. 
2011AP1514   
 
15 
 
¶40 Wisconsin Stat. § 805.16(1) provides that "[m]otions 
after verdict shall be filed and served within 20 days after the 
verdict is rendered, unless the court, within 20 days after the 
verdict is rendered, sets a longer time by an order specifying 
the dates for filing motions, briefs or other documents."  
Further, a litigant's failure to comply with the statute causes 
"the circuit court [to] 'los[e] competency to exercise its 
jurisdiction.'"  Hartford Ins. Co. v. Wales, 138 Wis. 2d 508, 
513, 406 N.W.2d 426 (1987) (quoting  Jos. P. Jansen v. Milwaukee 
Area Dist. Bd., 105 Wis. 2d 1, 10, 312 N.W.2d 813 (1981)). 
¶41 The circuit court's inability to consider a post-
verdict motion, however, does not deprive this court of 
appellate jurisdiction.  Failure to comply with Wis. Stat. 
§ 805.16 "limit[s] the issues that may be asserted as a matter 
of right on the appeal . . . ."  Wales, 138 Wis. 2d at 510-511.  
"A trial court's failure to conform with sec. 805.16, Stats., 
however, does not strip this court of its discretionary power[]" 
to review the case.  Brandner v. Allstate Ins. Co., 181 
Wis. 2d 1058, 1071, 512 N.W.2d 753 (1994).  
¶42 The merits issue in this case is of constitutional 
dimension and has been fully briefed and argued by both parties.  
We therefore exercise our discretion and address whether the 
punitive 
damages 
award 
against 
First 
American 
was 
unconstitutionally excessive. 
B. Punitive Damages Award 
¶43 Punitive damages are not intended to compensate the 
plaintiff, but rather are awarded "to punish the wrongdoer, and 
No. 
2011AP1514   
 
16 
 
to deter the wrongdoer and others from similar conduct."  
Trinity, 261 Wis. 2d 333, ¶50.  "Punitive damages may properly 
be imposed to further a State's legitimate interests in 
punishing unlawful conduct and deterring its repetition."  BMW 
of N. Am., Inc. v. Gore, 517 U.S. 559, 568 (1996).16 
¶44 In Wisconsin, punitive damages are authorized by 
statute, see Wis. Stat. § 895.043, and may be awarded "if 
evidence 
is 
submitted 
showing 
that 
the 
defendant 
acted 
maliciously toward the plaintiff or in an intentional disregard 
of the rights of the plaintiff."  Wis. Stat. § 895.043(3).  The 
judge has the duty to act as the "gatekeeper" when determining 
whether the issue of punitive damages is properly before the 
jury.  Strenke, 279 Wis. 2d 52, ¶40.  Once the judge has 
determined that the issue of punitive damages is properly before 
the jury, whether to actually award punitive damages "in a 
particular case is entirely within the discretion of the jury."  
Jacque, 209 Wis. 2d  at 626.  Both the judicial determination 
regarding whether punitive damages is a proper jury question and 
the size of the jury's punitive damages award are subject to 
review.  The Due Process Clause of the Fourteenth Amendment 
                                                 
16 Because punitive damages serve the State's interests, 
rather than serving to compensate a party, punitive damages 
awards do not implicate a plaintiff's right to a remedy or to a 
jury trial.  See Wis. Const. art. I, §§ 5 and 9; compare Ferdon 
ex rel. Petrucelli v. Wis. Patients Comp. Fund, 2005 WI 125, 
¶69, 
284 
Wis. 2d 573, 
701 
N.W.2d 440 
(suggesting 
that 
a 
statutory 
cap 
on 
noneconomic 
compensatory 
damages 
might 
implicate a plaintiff's right to a jury trial and to a remedy 
under the Wisconsin Constitution). 
No. 
2011AP1514   
 
17 
 
"imposes substantive limits on the size of a punitive damages 
award."  Trinity, 261 Wis. 2d 333, ¶49 (citing Mgmt. Computer 
Servs., 206 Wis. 2d at 193).17 
¶45 A punitive damages award "is excessive, and therefore 
violates due process, if it is more than necessary to serve the 
purposes of punitive damages, or inflicts a penalty or burden on 
the defendant that is disproportionate to the wrongdoing."  
Trinity, 261 Wis. 2d 333, ¶50.  "Elementary notions of fairness 
enshrined in our constitutional jurisprudence dictate that a 
person receive fair notice not only of the conduct that will 
subject him to punishment, but also of the severity of the 
penalty that a State may impose."  BMW, 517 U.S. at 574; see 
also Trinity, 261 Wis. 2d 333, ¶51. 
¶46 The United States Supreme Court has applied a three-
part test to determine whether an award of punitive damages is 
excessive.  See BMW, 517 U.S. at 574-75; State Farm Mut. Auto 
Ins. Co. v. Campbell, 538 U.S. 408 (2003).  This test asks the 
reviewing court to weigh: "(1) the degree of egregiousness or 
reprehensibility of the conduct; (2) the disparity between the 
                                                 
17 We have previously stated that "the evidence must be 
viewed in the light most favorable to the plaintiff, and a 
jury's punitive damages award will not be disturbed, unless the 
verdict is so clearly excessive as to indicate passion and 
prejudice." 
 
Trinity, 
261 
Wis. 2d 333, 
¶56; 
Jacque, 
209 
Wis. 2d at 626-27.  Given that punitive damages awards mandate 
de novo review, see Trinity, 261 Wis. 2d 333, ¶47, this language 
should not be read to require deference to the amount of the 
jury's award.  Rather, stating that an award is "so clearly 
excessive as to indicate passion and prejudice" is simply 
another way of referring to an award that violates due process. 
No. 
2011AP1514   
 
18 
 
harm or the potential harm suffered and the punitive damages 
award; and (3) the difference between the punitive damages and 
the possible civil or criminal penalties imposed for the 
conduct."  Trinity, 261 Wis. 2d 333, ¶52 (citing BMW, 517 
U.S. at 575). 
¶47 Wisconsin case law calls on courts to apply a 
substantively identical test applying six factors rather than 
three:  
1. 
The grievousness of the acts; 
2. 
The degree of malicious intent; 
3. 
Whether 
the 
award 
bears 
a 
reasonable 
relationship to the award of compensatory damages; 
4. 
The potential damage that might have been 
caused by the acts; 
5. 
The ratio of the award to civil or criminal 
penalties 
that 
could 
be 
imposed 
for 
comparable 
misconduct; and 
6. 
The wealth of the wrongdoer. 
Trinity, 261 Wis. 2d 333, ¶53; Mgmt. Computer Servs., 206 
Wis. 2d at 194.  Wisconsin courts are called upon to analyze 
only "those factors which are most relevant to the case, in 
order 
to 
determine 
whether 
a 
punitive 
damages 
award 
is 
excessive."18  Id. 
                                                 
18 While Wisconsin courts are free to apply these six 
factors flexibly, based upon their relevancy to a given case, 
they 
should 
be 
analyzed 
in 
conjunction 
with 
the 
three 
constitutional "guideposts" described by the Supreme Court in 
BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 575 (1996).  The 
factors are not intended to supplant the test mandated by the 
Constitution. 
No. 
2011AP1514   
 
19 
 
1. Reprehensibility 
¶48 "'[T]he most important indicium of the reasonableness 
of a punitive damage[s] award is the degree of reprehensibility 
of the defendant's conduct.'"  Trinity, 261 Wis. 2d 333, ¶57 
(quoting Jacque, 209 Wis. 2d at 628).  "This principle reflects 
the accepted view that some wrongs are more blameworthy than 
others."  BMW, 517 U.S. at 575. 
¶49 In Campbell, the Supreme Court explained the standard 
courts should apply in determining the reprehensibility of a 
defendant's conduct: 
We 
have 
instructed 
courts 
to 
determine 
the 
reprehensibility 
of 
a 
defendant 
by 
considering 
whether: the harm caused was physical as opposed to 
economic; the tortious conduct evinced an indifference 
to or a reckless disregard of the health or safety of 
others; the target of the conduct had financial 
vulnerability; the conduct involved repeated actions 
or was an isolated incident; and the harm was the 
result of intentional malice, trickery, or deceit, or 
mere accident.  The existence of any one of these 
factors weighing in favor of a plaintiff may not be 
sufficient to sustain a punitive damages award; and 
the absence of all of them renders any award suspect. 
538 U.S. at 419 (citation omitted); see also BMW, 517 U.S. at 
576-77. 
¶50 Turning to the case at issue, we must acknowledge that 
First American's conduct in the case at issue is reprehensible.  
First American knew that the North Easement did not provide 
access to the Kimble Lot and that there was no reasonable 
alternative 
access 
point, 
and 
yet 
refused 
to 
honor 
its 
obligation to assist the Kimbles in defending their title.  
First American further withheld the information it had in its 
No. 
2011AP1514   
 
20 
 
possession from the Kimbles, causing them to waste valuable time 
and resources.  These circumstances support an award of punitive 
damages.19  The question, however, is whether the degree of 
reprehensibility supports the punitive damages actually awarded.  
¶51 In that regard, it is noteworthy that none of the 
reprehensibility factors identified by the Supreme Court in 
Campbell are present in this case.  The damage suffered by the 
Kimbles 
was 
indisputably 
economic, 
not 
physical. 
 
First 
American's bad faith did not endanger the health or safety of 
any person.  There is no indication in the record that the 
Kimbles were financially vulnerable.20  The conduct complained of 
was an isolated incident.  And while First American's conduct 
indisputably involved deception, there is no indication of 
intentional malice on the part of the company or its employees.  
The punitive damages award against First American is therefore 
suspect.  Campbell, 538 U.S. at 419. 
¶52 Further, the degree of reprehensibility in this case 
falls short of that found in prior Wisconsin cases supporting 
substantial punitive damages awards. 
                                                 
19 The failure of an insurer to diligently investigate 
before denying a claim and concealing material information from 
an insured clearly meet this standard.  See, e.g., Trinity, 261 
Wis. 2d 333, ¶62. 
20 While Judith Kimble testified at trial that a dire 
financial situation faced by her elderly parents caused the 
Kimbles to reduce their asking price and be "more aggressive" in 
selling their home, the record does not contain any indication 
that the Kimbles themselves were in any financial trouble. 
No. 
2011AP1514   
 
21 
 
¶53 For 
example, 
in 
Trinity, 
the 
insurance 
company 
defendant denied a claim based on an omission in coverage, 
despite knowing that the omission in the policy was the result 
of its own error.  261 Wis. 2d 333, ¶¶7-8.  This court held that 
the insurance carrier not only "engaged in prohibited conduct 
while 
knowing 
or 
recklessly 
disregarding 
the 
lack 
of 
a 
reasonable basis for denying the claim," but further was a 
recidivist, having previously been the subject of a lawsuit 
involving precisely the same kind of conduct.  Id., ¶¶57-59.  
These facts allowed the defendant to be subjected to a more 
severe punitive damages award without offending due process: 
$3,500,000 in a case where only $490,000 in harm or potential 
harm had been established.21  Id. 
¶54 Here, there is no indication from the record that 
First American engaged in repeated conduct.  Neither does the 
record 
support 
any 
finding 
of 
malicious 
intent. 
 
First 
American's conduct, while "sufficiently reprehensible to give 
rise to tort liability, and even a modest award of exemplary 
damages does not establish the high degree of culpability that 
warrants a substantial punitive damages award."  BMW, 517 U.S. 
at 580. 
2. Disparity 
                                                 
21 "'[O]ur holdings that a recidivist may be punished more 
severely 
than 
a 
first 
offender 
recognize 
that 
repeated 
misconduct is more reprehensible than an individual instance of 
malfeasance.'"  Trinity, 261 Wis. 2d 333, ¶58 (quoting Campbell, 
538 U.S. at 423). 
No. 
2011AP1514   
 
22 
 
¶55 "When compensatory damages are awarded, the reviewing 
court is to consider whether the [punitive damages] award bears 
a reasonable relationship to the award of compensatory damages."  
Trinity, 261 Wis. 2d 333, ¶63.  "Wisconsin law expressly rejects 
the use of a fixed multiplier, either a fixed ratio of 
compensatory to punitive damages or of civil or criminal 
penalties to punitive damages, to calculate the amount of 
reasonable 
punitive 
damages." 
 
Id. 
(citations 
omitted).  
"However, we have held that in the appropriate case, a 
comparison of the compensatory damages and the punitive damages 
award is important."  Id. (citing Jacque, 209 Wis. 2d at 629). 
¶56 In the case at issue, the compensatory damages 
ultimately awarded were $29,738.49.  Using the compensatory 
damages award as a baseline thus represents a ratio of 
approximately 33:1.  Such a ratio is transparently problematic 
under the United States Constitution. 
¶57 The 
Supreme 
Court, 
however, 
has 
declared 
that 
reviewing courts can consider not only the compensatory damages 
award, but also "'the harm likely to result from the defendant's 
conduct.'"  BMW, 517 U.S. at 581 (quoting TXO Prod. Corp. v. 
Alliance Res. Corp., 509 U.S. 443, 460 (1993)).  Similarly, 
where it is relevant and appropriate, our prior case law 
supports consideration of "potential damage" that might have 
been caused by a defendant's acts.  Trinity, 261 Wis. 2d 333, 
¶53. 
¶58 The Stevensons argue that the appropriate figure to 
use in assessing the disparity, in light of the sale the Kimbles 
No. 
2011AP1514   
 
23 
 
lost during the dispute, is the full $1,300,000 sale price of 
the Kimbles' home.  We disagree.  The Stevensons can point to no 
indication in the record that the full value of the Kimbles' 
property was ever in danger.22  Case law does not support this 
type of speculative "potential damage," particularly where it is 
unsupported by the record. 
¶59 For example, in TXO, the petitioner fraudulently 
attempted to undermine the title to a tract of land in order to 
avoid paying royalties for oil and gas extraction.  509 U.S. at 
448-50.  The respondent received a judgment for common law 
slander of title in its favor, including $19,000 in compensatory 
damages and $10,000,000 in punitive damages.  Id. at 453.  
Petitioner 
appealed, 
arguing 
that 
the 
526:1 
ratio 
of 
compensatory 
to 
punitive 
damages 
rendered 
the 
award 
unconstitutionally excessive.  Id.  A plurality of the Supreme 
Court held that, in addition to the compensatory damages award, 
it was appropriate to consider the "between $5 million and $8.3 
million" in lost royalties that the respondent would have 
suffered had petitioner's plan succeeded.  Id. at 460-61. 
¶60 Similarly, in Trinity, this court accepted that the 
appropriate 
figure 
for 
comparison 
was 
not 
the 
$17,000 
compensatory damages award, but rather was the $490,000 in 
potential damages at risk in the underlying negligence suit. 
                                                 
22 On December 26, 2013, the Stevensons filed a motion to 
supplement the record by judicial notice, asking this court to 
take into account the eventual sale price of the Kimbles' home.  
We deny that motion.  The supplemental information was not part 
of the record before the trial court. 
No. 
2011AP1514   
 
24 
 
¶61 Notably, the "potential harm" in both of these cases 
is grounded in record and is not merely speculative.  Had the 
plaintiff in Trinity lost its case, $490,000 was the amount it 
would have had to pay.  Had the petitioner's scheme in TXO 
succeeded, it was undisputed that the respondent would have been 
deprived of millions of dollars in royalties.  These analyses 
were firmly rooted in fact, and the amounts in question were 
derived from the record. 
¶62 Here, the Stevensons invite this court to depart from 
the facts of the record and speculate that, had the Kimbles 
failed to discover First American's bad faith, they would have 
been completely unable to sell their property, rendering it 
valueless.  We decline this invitation.  Many factors enter into 
a completed sale of real estate, and to attribute full 
responsibility for the lost sale to First American is highly 
speculative.  There is no clear indication in the record of what 
impact the access dispute had on the value of the Kimbles' 
property. 
¶63 We share Justice Kennedy's concern that, without a 
meaningful standard, a court can end up "relying upon nothing 
more than its own subjective reaction to a particular punitive 
damages award in deciding whether the award violates the 
Constitution." 
 
TXO, 
509 
U.S. 
at 
466-67 
(Kennedy, 
J., 
concurring). 
¶64 Fortunately, there is no need to speculate about 
potential harm, or to rely on subjective reactions, in order to 
appropriately assess the disparity in this case.  The record 
No. 
2011AP1514   
 
25 
 
reveals that the Kimbles spent $40,000 to purchase the access to 
their property that their title policy was supposed to insure.23  
Given that the compensatory damages award merely accounted for 
legal expenses, it is appropriate to add the compensatory 
damages together with the cost of purchasing the access for 
purposes of assessing the disparity of the punitive damages 
award.  This $69,738.49 figure, however, still represents a 
problematic ratio of approximately 14:1. 
¶65 "[I]n practice, few awards exceeding a single-digit 
ratio 
between 
punitive 
and 
compensatory 
damages, 
to 
a 
significant degree, will satisfy due process."  Campbell, 538 
U.S. at 425.  Even a punitive damages award of just four times 
compensatory damages can come "'close to the line'" of violating 
due process.  BMW, 517 U.S. at 581 (quoting Pac. Mut. Life Ins. 
Co. v. Haslip, 499 U.S. 1, 23 (1991)).24 
¶66 In 
the 
case 
at 
issue, 
there 
are 
no 
special 
circumstances calling for a high ratio punitive damages award.  
This becomes especially apparent when the conduct here is 
                                                 
23 Although this evidence was not before the jury at trial, 
it was before the circuit court and was made a part of the 
record on appeal.  We may, therefore, properly consider it in 
"review[ing] the entire record 'ab inito' . . . ."  Trinity, 261 
Wis. 2d 333, ¶48. 
24 Additionally, the Wisconsin Legislature recently enacted 
a law limiting punitive damages awards.  See 2011 Wis. Act 2 
§ 23m.  The new statute caps punitive damage awards at a 2:1 
ratio of compensatory damages or $200,000, whichever is greater.  
Wis. Stat. § 895.043(6) (2011-12).  While the statute is not 
applicable to this case, it is nonetheless appropriate to 
consider the legislature's judgment of a reasonable disparity of 
punitive to compensatory damages. 
No. 
2011AP1514   
 
26 
 
compared to other cases where courts have upheld high ratio 
awards.  See, e.g., Trinity, 261 Wis. 2d 333; J.K. v. Peters, 
2011 WI App 149, 337 Wis. 2d 504, 808 N.W.2d 141 (upholding a 
high ratio punitive damages award against a social worker who 
sexually assaulted his minor client); Strenke v. Hogner, 2005 WI 
App 194, 287 Wis. 2d 135, 704 N.W.2d 309 (upholding a high ratio 
punitive damages award against a drunk driver who caused 
substantial injuries to another motorist).25  These prior cases 
involve the kind of especially egregious conduct identified by 
the Supreme Court in Campbell, including "physical as opposed to 
economic" harm, and "indifference to or a reckless disregard of 
the health or safety of others."  538 U.S. at 419.  As we have 
discussed, the case at issue does not involve such conduct. 
¶67 In sum, the award in this case does not bear a 
"reasonable relationship" to either the compensatory damages 
award or the potential harm faced by the Kimbles.  We conclude, 
therefore, that the award does not comport with due process. 
3. Civil or Criminal Penalties 
¶68 Finally, "we engage in a comparison of the punitive 
damages award and the civil or criminal penalties that could be 
imposed for comparable misconduct."  Trinity, 261 Wis. 2d 333, 
¶66 (citing Jacque, 209 Wis. 2d at 630).  In this case, as in 
Trinity, First American could be subject to a criminal penalty, 
                                                 
25 The court of appeals upheld the damages award in Strenke 
on remand from this court.  This court was equally divided on 
the question of whether the award of punitive damages was 
excessive.  See Strenke, 279 Wis. 2d 52, ¶58. 
No. 
2011AP1514   
 
27 
 
including a fine of up to $10,000, for the violation of "any 
insurance statute or rule of this state." 
 Wis. Stat. 
§ 601.64(4).  The Stevensons argue that First American violated 
Wis. Admin. Code § Ins. 6.11(3)(a), which prohibits unfair 
settlement practices. 
¶69 In this case we conclude, as we did in Trinity, that 
"a criminal penalty has 'less utility' when used to determine 
the dollar amount of the punitive damages award."  261 
Wis. 2d 333, ¶68 (citing Campbell, 538 U.S. at 428).  We 
nonetheless note that "[t]he existence of a criminal penalty 
does have bearing on the seriousness with which a State views 
the wrongful action."  Id., ¶66 (quoting Campbell, 538 U.S. at 
428). 
4. Application 
¶70 Applying the relevant factors to the case at issue, we 
conclude that the punitive damages award against First American 
is excessive.  First, First American's conduct "is sufficiently 
reprehensible to give rise to tort liability, and even a modest 
award of exemplary damages does not establish the high degree of 
culpability that warrants a substantial punitive damages award."  
BMW, 517 U.S. at 580.  Second, there is no especially egregious 
conduct supporting a high ratio punitive damages award.  Absent 
such egregious conduct, even the 7:1 ratio imposed in Trinity 
would be unconstitutionally excessive.  Finally, the existence 
of an additional civil or criminal penalty has "limited utility" 
No. 
2011AP1514   
 
28 
 
in determining the reasonableness of the punitive damages 
award.26  See Trinity, 261 Wis. 2d 333, ¶68. 
¶71 We conclude, in consideration of the case law, that 
the appropriate amount of punitive damages in this case is 
$210,000.  Comparing the amount of this award to the $69,738.49 
amount of compensatory and potential damages results in a ratio 
of approximately 3:1, below the ratio we upheld in Trinity, and 
just below the constitutional "line" mentioned by the Supreme 
Court in BMW, 517 U.S. at 581, and Haslip, 499 U.S. at 23.  
Because "[t]he precise award in any case, of course, must be 
based upon the facts and circumstances of the defendant's 
conduct and the harm to the plaintiff," Campbell, 538 U.S. at 
425, we conclude that this amount effectively punishes First 
American's misconduct, while acknowledging that its conduct did 
not rise to level of egregiousness found in prior punitive 
damages cases. 
V. 
CONCLUSION 
¶72 We conclude that the punitive damages award in this 
case was excessive and deprived First American of its right to 
                                                 
26 We note here, as we did in Trinity that "[t]he factors 
discussed are the ones most relevant in this case . . . [and] 
there are other factors that may be relevant given the nature of 
the case at hand."  261 Wis. 2d 333, ¶69.  In particular, we 
note that while the "[d]efendant's wealth is oftentimes a 
significant factor," id., it is not significant in this case.  
The record indicates First American would likely be able to pay 
the amount specified by the jury.  Standing alone, however, the 
"wealth 
of 
a 
defendant 
cannot 
justify 
an 
otherwise 
unconstitutional punitive damages award."  State Farm Mut. Auto 
Ins. Co. v. Campbell, 538 U.S. 408, 427 (2003) (citing BMW, 517 
U.S. at 585). 
No. 
2011AP1514   
 
29 
 
due process.  We therefore reverse the court of appeals' 
decision and remand this case to the circuit court for entry of 
judgment against First American in the amount of $239,738.49. 
By the Court.—The decision of the court of appeals is 
reversed, and the cause is remanded to the circuit court. 
¶73 DAVID T. PROSSER, J., did not participate. 
 
No.  2011AP1514.ssa 
 
1 
 
¶74 SHIRLEY 
S. 
ABRAHAMSON, 
C.J.   (dissenting). 
 
The 
majority opinion reaches a shocking result:  It makes First 
American's wrongdoing an efficient way of doing business.  For 
all its reprehensible conduct, First American in fact pays less 
by acting in bad faith and wrongfully refusing to pay the 
Kimbles' claim than it would have paid had it honored the claim 
in good faith after discovering its error.  Under the majority 
opinion, the combined punitive and compensatory damages amount 
to $239,738.49——a sum smaller than the title insurance policy 
limit of $370,000.  This result directly contravenes the entire 
purpose of punitive damages——making wrongdoers pay and deterring 
future wrongful conduct.  
¶75 Trinity Evangelical Lutheran Church & School-Freistadt 
v. Tower Insurance Co., 2003 WI 46, 261 Wis. 2d 333, 661 
N.W.2d 789, is the leading case for determining whether punitive 
damages are unconstitutionally excessive as a violation of due 
process.  The majority opinion dutifully recites the Trinity 
factors.1  Yet the majority opinion jettisons Trinity, turning 
the test on its head in favor of the reasoning set forth in 
Trinity's dissent. 
¶76 The majority opinion achieves a result in which the 
wrongdoer was enriched by its wrongdoing.  This result, in my 
opinion, cannot stand.  
 
¶77 The test in Trinity applies six factors to assess 
whether a punitive damages amount is justified: 
1. The grievousness of the acts; 
                                                 
1 Majority op., ¶48. 
No.  2011AP1514.ssa 
 
2 
 
2. The degree of malicious intent; 
3. Whether the award bears a reasonable relationship 
to the award of compensatory damages; 
4. The potential damage that might have been caused by 
the acts; 
5. The ratio of the award to civil or criminal 
penalties that could be imposed for comparable 
conduct; and 
6. The wealth of the wrongdoer. 
Majority op., ¶48; Trinity, 261 Wis. 2d 333, ¶53.   
 
¶78 It is perverse not to apply the Trinity test to the 
instant case.  The instant case is on all fours with Trinity.  
In both cases an insurance company refused to pay the insured's 
claim (breach of contract); the court found that the insurance 
company breached the insurance contract; the insurance company 
was found to have acted in bad faith; and the fact-finder found 
that the misconduct justified a punitive damage award.2   
                                                 
2 Here are the facts of Trinity:  An employee of Trinity 
Church, the insured, was in a motor vehicle accident, and 
Trinity Church was liable for damages of $490,000.    
An agent of Tower Insurance erred by not providing Trinity 
Church the coverage that Trinity Church requested.  
Tower Insurance refused to reform the policy to cover 
Trinity Church (as the law required it to do) and to pay 
$490,000 on behalf of Trinity Church.  Trinity Church sued Tower 
Insurance for breach of contract, bad faith, and punitive 
damages.   
Tower Insurance paid $490,000 on Trinity Church's behalf. 
No.  2011AP1514.ssa 
 
3 
 
¶79 In Trinity, the court held that due process was 
satisfied by a punitive damages amount of $3,500,000 based on a 
potential harm of $490,000, a 7:1 ratio.     
¶80 Because the majority opinion fails to apply Trinity 
properly, I dissent. 
I 
 
¶81 The 
first 
factor 
of 
the 
Trinity 
test 
is 
the 
grievousness of the acts.  The insurance company's misconduct 
was substantially the same in Trinity and in the present case: 
• In each case, an insurance company was sued by its 
insured (or someone standing in the insured's shoes); 
• In each case, the insurance company had failed to pay 
the claim of its own insured; 
• In each case, the insurance company was given repeated 
opportunities to pay the claim and refused to do so, 
                                                                                                                                                             
The Trinity court used the $490,000 figure as harm to 
Trinity Church to calculate the punitive damages.  Had Tower 
Insurance's misconduct not been discovered, Trinity Church would 
have had to pay the full $490,000 from its own funds; Tower 
Insurance would have received a net gain of $490,000.   In 
calculating the harm to Trinity Church, the Trinity court did 
not take into account that Tower Insurance's agent might 
ultimately be responsible for paying the $490,000. 
Here are the facts in the instant case:  First American 
erred in not providing the Kimbles with their policy limits of 
$370,000 when First American discovered that the Kimbles' title 
was not marketable.   Had First American's misconduct not been 
discovered, the Kimbles could not have sold their property, 
leaving them with a loss of both the $1.3 million sale price of 
the property and the $370,000 policy limits of the First 
American title insurance policy.  First American would have 
received a net gain of $370,000. 
No.  2011AP1514.ssa 
 
4 
 
despite knowing the facts justifying payment of the 
claim; 
• In each case, the insurance company was found to have 
acted in bad faith; and 
• In each case, a jury awarded over $1 million in 
punitive damages. 
 
¶82 The Trinity court held that the insurance company's 
misconduct constituted a "continuing, egregious, and flagrant 
pattern of disregard toward [the insurance company's] duty owed 
to its insured," which justified the punitive damages in that 
case.3 
 
¶83 The majority opinion in the present case characterizes 
First American's conduct as not as reprehensible as that of the 
insurance company in Trinity.  Majority op., ¶¶53-55, 71. 
 
¶84 The majority opinion's conclusion does not square with 
the facts of the two cases.   
 
¶85 First, as in Trinity, the legislature has made the 
insurance company's misconduct a crime, demonstrating the public 
policy 
of 
this 
state 
regarding 
the 
misconduct's 
reprehensibility.  See majority op., ¶69; accord Trinity, 261 
Wis. 2d 333, ¶57. 
 
¶86 Second, as in Trinity, First American's misconduct was 
repeated; First American was a recidivist.4  In Trinity, the 
                                                 
3 Trinity, 261 Wis. 2d 333, ¶62. 
4 Majority op., ¶53 n.20 (quoting Trinity, 261 Wis. 2d 333, 
¶58:  "'[O]ur holdings that a recidivist may be punished more 
severely 
than 
a 
first 
offender 
recognize 
that 
repeated 
misconduct is more reprehensible than an individual instance of 
malfeasance.'") (internal citation omitted). 
No.  2011AP1514.ssa 
 
5 
 
court noted that the insurance company's agent "made a series of 
decisions that illustrate bad faith" and chastised the insurance 
company's repeated misconduct and failure to investigate.5 
 
¶87 The majority opinion erroneously states that First 
American's misconduct was "an isolated incident," and that 
"there is no indication from the record that First American 
engaged in repeated conduct."  Majority op., ¶51.  On the 
contrary, First American in the instant case demonstrates a 
pattern of repeated misconduct.  After discovering its initial 
error, First American had many opportunities to remedy its 
misconduct and instead continued to act improperly: 
• When the Kimbles first inquired about their road 
access, First American asserted that an easement gave 
them access, when it in fact knew that the easement 
granted to the Kimbles was invalid.6 
• When the Kimbles inquired whether they could assert a 
claim to the easement, First American assured them 
that they had road access.7 
• At trial, First American's agent admitted that it 
discovered 
the 
deed 
that 
rendered 
the 
Kimbles' 
easement invalid, and chose never to inform the 
Kimbles about the deed.8 
                                                 
5 Trinity, 261 Wis. 2d 333, ¶60. 
6 Majority op., ¶9. 
7 Majority op., ¶10. 
8 The trial yielded the following testimony: 
No.  2011AP1514.ssa 
 
6 
 
• At trial, First American's agent admitted that it 
deliberately failed to investigate the alleged title 
defect.9 
• Each time the Kimbles inquired as to their access, 
First American insisted that the Kimbles could access 
the road, variously stating that the Kimbles could go 
across a 25-foot strip to which they had no access,10 
                                                                                                                                                             
[KIMBLES' COUNSEL]: Now, at your——at your deposition, 
I asked you whether you made any mention of the Cofrin 
deed [which rendered the easement invalid] to [the 
Kimbles' agent] in March of 2008.  Do you recall that? 
[FIRST AMERICAN'S AGENT]: Yes. 
[KIMBLES' COUNSEL]:  And we talked about your letters 
that you sent back and forth with him, correct? 
[FIRST AMERICAN'S AGENT]: Yes. 
[KIMBLES' COUNSEL]: And you acknowledge that it's true 
that you never told [the Kimbles' agent] about the 
Cofrin deed at any time in any of your conversations 
or in any of your letters? 
[FIRST AMERICAN'S AGENT]: That is correct. 
9 At trial, an investigator employed by First American 
testified that she asked First American's agent whether she 
should investigate further.  The investigator suggested problems 
with the validity of the deed, and asked, "What does all of this 
mean 
for 
us?" 
and 
"Do 
you 
want 
me 
to 
dig 
for 
more 
documentation?"  The investigator testified that she never 
received a response.   
10 The access to the south depended on an easement across a 
25-foot strip of property.  First American testified at trial 
that "Land Concepts [which does not want to give access] owns 
the fee simple interest to the 25-foot strip."   
No.  2011AP1514.ssa 
 
7 
 
through 
a 
wetland 
that 
was 
barred 
from 
road 
construction,11 and confusingly, "by water."12 
 
¶88 The majority opinion maintains that the repeated 
misconduct 
here 
is 
less 
reprehensible 
than 
the 
repeated 
                                                 
11 See court of appeals brief of defendant-appellant at 21.  
The access to the south also needed to cross lands marked as 
wetlands.  The trial record reflects the following exchange: 
[KIMBLES' COUNSEL]:  And did you take the position 
that the [Kimbles] had a right of access to their 
property to the south? 
[FIRST AMERICAN'S AGENT]: Yes. 
[KIMBLES' COUNSEL]: Through an area of forest and 
wetlands, correct? 
[FIRST AMERICAN'S AGENT]: Yes. 
Yet, government regulations prohibited development on the 
forest and wetlands, as the defendant's agent testified: 
[KIMBLES' COUNSEL]: And you know from reading [the 
government official's] deposition that the area that 
you've described is defined as wetlands according to 
Door County Planning, right? 
[FIRST AMERICAN'S AGENT]: That's correct. 
[KIMBLES' COUNSEL]: And that, in fact, Door County 
Planning has indicated that that area could not be 
developed into any road or opened or cleared, true? 
[FIRST AMERICAN'S AGENT]: That is correct. 
12 The trial record reflects the following exchange: 
[KIMBLES' COUNSEL]: Well, you recall testifying at 
that court trial regarding whether the company was, in 
fact, at that time on Tuesday going to assert that the 
Kimbles enjoyed a right of access by water.  Do you 
recall that testimony? 
[FIRST AMERICAN'S AGENT]:  It came up.  I recall it 
coming up. 
No.  2011AP1514.ssa 
 
8 
 
misconduct in Trinity because the insurance company in Trinity 
had committed similar misconduct in another case 30 years 
previously.  Majority op., ¶53.   
¶89 Yet the key factor for the reprehensibility of the 
insurance company's misconduct in Trinity was not that a 30-
year-old prior court case existed or that the insurance company 
knew 
about 
it, 
but 
rather 
that 
the 
insurance 
company's 
"decisions, acts, and omissions . . . illustrate a continuing, 
egregious, and flagrant pattern of disregard toward [the 
insurance company's] duty owed to its insured . . . ."  Trinity, 
261 Wis. 2d 333, ¶62. 
¶90 The record in the present case demonstrates that First 
American exhibited a similar continuing, egregious, and flagrant 
pattern of misconduct.   
II 
¶91 The second factor is whether there was "intentional 
malice."   
¶92 The majority opinion in the present case states that 
"there is no indication of intentional malice on the part of the 
First 
American 
or 
its 
employees." 
 
Majority 
op., 
¶52.  
Similarly, the Trinity court concluded that there was no 
indication of intentional malice in that case either.  Indeed 
Trinity does not require malice in order for punitive damages to 
be awarded.  Rather, Trinity justified the amount of the 
punitive damages award on the insurance company's "intentional 
disregard of its duty to investigate diligently to ascertain and 
No.  2011AP1514.ssa 
 
9 
 
evaluate the facts and circumstances . . . ."  Trinity, 261 
Wis. 2d 333, ¶59.    
 
¶93 The jury in the instant case found sufficient grounds 
to justify a finding that punitive damages should be awarded, 
based on the evidence presented and the jury instructions.  The 
jury instructions stated that the jury should award punitive 
damages if it found that "the defendant acted maliciously toward 
the plaintiff or in an intentional disregard for the rights of 
the plaintiff."13  With a $1 million jury award of punitive 
                                                 
13 Wis JI——Civil 1707.1, which was given to the jury, reads 
in relevant part: 
Punitive damages may be awarded, in addition to 
compensatory damages, if you find that the defendant 
acted maliciously toward the plaintiff or in an 
intentional disregard of the rights of the plaintiff. 
A person's acts are malicious when they are the result 
of hatred, ill will, desire for revenge, or inflicted 
under 
circumstances 
where 
insult 
or 
injury 
is 
intended. 
A person acts in an intentional disregard of the 
rights of the plaintiff if the person acts with the 
purpose to disregard the plaintiff's rights, or is 
aware that his or her acts are substantially certain 
to result in the plaintiff's rights being disregarded.  
Before you can find an intentional disregard of the 
rights of the plaintiff, you must be satisfied that 
the defendant's act or course of conduct was: 
(1) deliberate; 
(2) an actual disregard of the plaintiff's right to 
safety, health, or life, a property right, or some 
other right; and 
(3) sufficiently aggravated to warrant punishment by 
punitive damages. 
 
 . . . . 
No.  2011AP1514.ssa 
 
10 
 
damages, the jury found the "high degree of culpability" that 
could justify a punitive damages award.14  Credible evidence 
supports the jury's finding of either malicious intent or 
intentional disregard of the rights of the insured.  The 
majority 
opinion 
does 
not 
state 
that 
the 
evidence 
was 
insufficient for the jury to make such a finding.  The jury 
finding is sufficient to satisfy Trinity. 
III 
 
¶94 The Trinity test's third factor (ratio of compensatory 
damages to punitive damages) and fourth factor (potential damage 
to the plaintiff) are linked.   
¶95 Trinity examined the ratio between potential harm and 
punitive damages to determine the appropriateness of the award.  
Trinity, 261 Wis. 2d 333, ¶65.  "Wisconsin law expressly rejects 
the 
use 
of 
a 
fixed 
multiplier . . . ." 
 
Trinity, 
261 
Wis. 2d 333, ¶63.   
                                                                                                                                                             
Factors you should consider in answering Question No. 
6  [awarding the amount of punitive damages] include: 
1. the grievousness of the defendant's acts, 
2. the degree of malice involved, 
3. the potential damage which might have been done by 
such acts as well as the actual damage, and  
4. the defendant's ability to pay.  You may consider 
the defendant's wealth in determining what sum of 
punitive 
damages 
will 
be 
enough 
to 
punish 
the 
defendant and deter the defendant and others from the 
same conduct in the future. 
See also Wis. Stat. § 895.043(3). 
14 Majority op., ¶54. 
No.  2011AP1514.ssa 
 
11 
 
¶96 Despite the lack of a fixed multiplier, Trinity 
provides a benchmark for the court.  If a 7:1 ratio of punitive 
damages 
to 
potential 
harm 
($3,500,000 
punitive; 
$450,000 
potential harm) and a 200:1 ratio of punitive damages to actual 
damages ($3,500,000 punitive; $17,570 actual damages) were 
permissible in Trinity, the instant case, so similar in facts, 
also supports an identical or similar ratio.   
¶97 The 
amount 
of 
potential 
harm 
is 
calculated 
by 
analyzing "'the harm likely to result from the defendant's 
conduct as well as the harm that actually has occurred.'"  TXO 
Production Corp. v. Alliance Resources Corp., 509 U.S. 443, 460, 
(1993) (quoted source omitted).   
¶98 In the instant case, the Kimbles were harmed.  They 
had an offer to buy their property for $1.3 million.  They 
wanted to sell.  They chose to reduce the asking price to secure 
the sale because they needed to care for aging parents who had 
lost their home.  The Kimbles introduced evidence that the sale 
failed because of the lack of road access, a defect in 
marketable title that had been insured by First American.    
¶99 The Kimbles had purchased title insurance to protect 
them from damages arising out of the unmarketability of their 
title.  The policy limit was $370,000.  The value of the 
property with marketable title was about three times the policy 
limit. 
¶100 The majority opinion erroneously asserts that a 
consideration of the loss of value of Kimbles' home would force 
the court "to depart from the facts of the record and speculate 
No.  2011AP1514.ssa 
 
12 
 
that, had the Kimbles failed to discover First American's bad 
faith, they would have been completely unable to sell their 
property, rendering it valueless."  Majority op., ¶62. 
¶101 Yet this potential harm is borne by the record.  The 
lack of access constituted "unmarketability of the title."15  The 
policy itself defines "unmarketability of the title" as "an 
alleged 
or 
apparent 
matter 
affecting 
the 
title 
to 
the 
land . . . which would entitle a purchaser of the estate [or the 
Kimbles] to be released from the obligation to purchase by 
virtue of a contractual condition requiring the delivery of 
marketable title."  As First American's agent stated in a 
deposition entered into evidence at trial, the risk of wrongly 
denying the claim was that the Kimbles "would have had a real 
big claim on the policy . . . ." 
¶102 In Trinity, the facts were similar.  The insured in 
Trinity would have incurred a potential loss of up to $490,000 
(damages in the auto accident case), had the insurance company 
successfully continued to deny Trinity Church's claim. The 
majority opinion in Trinity used the $490,000 figure for 
evaluating the punitive damages award.   
¶103 In 
the 
instant 
case, 
the 
Kimbles 
would 
have 
potentially incurred a loss of up to $1.3 million, the sale 
price of the property if they had marketable title, and would 
                                                 
15 "[E]ven if the policy does not expressly cover lack of a 
right of access, if it insures against unmarketability of the 
title, the title insurer will be liable if no legal access to 
the land exists.  The majority rule is that lack of access makes 
title unmarketable."  1 Joyce D. Palomar, Title Insurance Law 
§ 5:8 (West 2013-2014). 
No.  2011AP1514.ssa 
 
13 
 
not 
have 
recovered 
First 
American's 
title 
policy 
limits 
($370,000), had First American successfully denied the Kimbles' 
claim.   
¶104 The majority opinion refuses to use the $1.3 million 
sale price or $370,000 policy limit figures to calculate 
punitive damages.  Instead the majority opinion adopts the 
reasoning of the dissent in Trinity.   
¶105 Justice Sykes' dissent in Trinity argues that the 
insured "was never at risk for the auto accident damages, 
because either the agent (that is, his error and omissions 
carrier) or [the insurance company] was responsible for the 
mistake in the insurance application.  The actual compensatory 
damages in the bad faith claim consisted of the attorneys' fees 
Trinity [Church] incurred in the coverage dispute, not the 
personal injury damages in the underlying lawsuit, which Trinity 
[Church] would not and did not have to pay."  Trinity, 261 
Wis. 2d 333, ¶106. 
¶106 The majority opinion in the present case follows 
Justice Sykes' approach by severely limiting what is actual and 
potential harm, rather than employing the correct Trinity 
majority opinion approach of using "the harm that is likely to 
result."16   
¶107 When title is not marketable, the significantly 
reduced value of the property and the inability of an insured to 
collect from the title insurance company are exactly "the 
                                                 
16 TXO Production Corp. v. Alliance Resources Corp., 509 
U.S. 443, 460 (1993). 
No.  2011AP1514.ssa 
 
14 
 
harm[s] that [are] likely to have occurred" when a title 
insurance company fails to pay a worthy claim.  Thus, the proper 
potential harm is at least the policy limits of $370,000, if not 
the lost sale of the house ($1.3 million), or both, rather than 
the mere $40,000 used by the majority opinion. 
 
¶108 As to the proper ratio here, the majority opinion 
relies upon its mistaken "reprehensibility of conduct" analysis 
to justify a lower ratio than the Trinity 7:1 ratio of punitive 
damages to potential harm and the 200:1 ratio of punitive 
damages to actual damages that this court held constitutional.  
Trinity, 261 Wis. 2d 333, ¶¶65, 68, 105; majority op., ¶66.   
¶109 Even though the misconduct of First American here is 
essentially analogous to the misconduct in Trinity and may even 
be more egregious, the majority opinion applies only one guiding 
principle:  High numbers for compensatory and punitive damages 
are bad; low numbers are good. 
 
¶110 The 
majority 
settles 
on 
its 
3:1 
ratio 
for 
no 
ostensible reason other than that it is lower than the 7:1 and 
200:1 ratios in Trinity and the 4:1 ratio in Pacific Mutual Life 
Insurance Co. v. Haslip, 499 U.S. 1, 23-24 (1996).  Yet in 
Pacific Mutual Life Insurance Co., the United States Supreme 
Court held that the 4:1 ratio was "close to the line," not over 
it.   
¶111 The majority opinion also looks to a newly adopted 
state statute, which fixes $200,000 or a 2:1 ratio of punitive 
damages to compensatory damages as the limits for punitive 
damages awards.  Majority op., ¶66 n.23.  The statute is 
No.  2011AP1514.ssa 
 
15 
 
irrelevant.  The majority opinion deliberately defies the 
legislative direction that the statute does not apply to the 
present case.  Furthermore, the constitutional due process 
doctrine that we must apply in the present case rejects a fixed 
amount for punitive damages or a fixed multiplier.  "Excessive" 
for due process purposes is a "fluid concept" that takes 
"substantive content from the particular context[] in which the 
standard[] [is] being assessed."17 
 
¶112 What was good enough for the Trinity court seems to no 
longer be good enough for the majority opinion in the present 
case. 
IV 
¶113 The fifth Trinity factor is "a comparison of the 
punitive damages award and the civil or criminal penalties that 
could be imposed for comparable misconduct."  Trinity, 261 
Wis. 2d 333, ¶66.  I agree with the majority opinion that the 
imposition of criminal or civil fines does not directly impact 
the amount of punitive damages in the instant case, for the same 
reasoning we used in Trinity.  See majority op., ¶69.   
 
¶114 Nevertheless, the prohibited conduct's punishment by 
criminal sanctions under Wis. Stat. § 601.64(4) evinces the 
legislative determination of the reprehensibility of First 
American's misconduct. 
V 
                                                 
17 Cooperman Indus., Inc. v. Leatherman Tool Group, Inc., 
532 U.S. 424, 436 (2001). 
No.  2011AP1514.ssa 
 
16 
 
¶115 The sixth Trinity factor is the wealth of the 
wrongdoer.  The United States Supreme Court has also recognized 
the wealth of the wrongdoer as a factor to be considered in 
gauging the constitutionality of a punitive damage award.18   
¶116 The purpose behind the wealth factor is to punish 
wrongdoers and make the penalty for wrongdoing sufficiently high 
for wealthy wrongdoers that they are deterred from engaging in 
future misconduct.19   
                                                 
18 The wealth and financial position of the defendant are 
examined to assess the excessiveness of the punitive damages 
award.  See, e.g., TXO Production Corp., 509 U.S. 443, 462 
(1993); Pacific Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 23-24 
(1996). 
19 The majority opinion states the purpose of punitive 
damages as follows: 
[Punitive 
damages] 
are 
awarded 
"to 
punish 
the 
wrongdoer, and to deter the wrongdoer and others from 
similar conduct."  Trinity, 261 Wis. 2d 333, ¶50.  
"Punitive damages may properly be imposed to further a 
State's legitimate interests in punishing unlawful 
conduct and deterring its repetition."  BMW of N. Am., 
Inc. v. Gore, 517 U.S. 559, 568 (1996). 
Majority op., ¶43. 
Justice 
Steinmetz 
articulated 
the 
reasoning 
behind 
considering the wealth of the parties in his dissent in Brown v. 
Maxey, 124 Wis. 2d 426, 452, 369 N.W.2d 677 (1985) (Steinmetz, 
J., dissenting).  He stated: 
The policy justifications for punitive damages are 
generally considered to be:  punish the wrongdoer and 
specifically deter him and generally deter others from 
engaging in similar conduct. . . . It is almost 
universally accepted that money talks.  By tailoring 
the amount of punitive damages to the relative wealth 
of the individual, every wrongdoer is more or less 
equally affected by the sanction. 
No.  2011AP1514.ssa 
 
17 
 
¶117 In the instant case, the record demonstrates that in 
2010, First American had revenues over $2 billion and net 
profits of $65 million.  First American easily had the ability 
to pay the $1 million the jury awarded as punitive damages and 
then some.   
¶118 Yet in the instant case, the majority opinion's 
result, as I noted previously, creates a final combined punitive 
and compensatory damages amount of $239,738.49——a sum smaller 
than the title insurance policy limit of $370,000.  The majority 
opinion makes First American's wrongdoing an efficient course of 
business.  First American in fact pays less by acting in bad 
faith and wrongfully refusing to pay the Kimbles' claim than it 
would have paid had it honored the claim in good faith after 
discovering its error.  This result directly contravenes the 
entire purpose of punitive damages, let alone the purpose of 
awarding punitive damages against a wealthy defendant.20 
¶119 The majority opinion again strays from 
Trinity.  
Trinity held, contrary to the majority opinion in the instant 
case, that evidence of the insurance company's wealth and 
ability to pay the full amount was "sufficient to justify the 
size of the punitive damages award."  Trinity, ¶69.  In Trinity, 
                                                 
20 This rationale was echoed by the court in Jacque v. 
Steenberg Homes, 209 Wis. 2d 605, 631, 563 N.W.2d 154 (1997), 
which explained the need to eliminate the profit motive for 
wrongdoing: 
Punitive damages, by removing the profit from illegal 
activity, can help to deter such conduct.  In order to 
effectively do this, punitive damages must be in 
excess of the profit created by the misconduct so that 
the defendant recognizes a loss. 
No.  2011AP1514.ssa 
 
18 
 
the company would have had to liquidate assets to pay the 
award.21  First American has no similar concern here.   
¶120 The majority opinion dismisses the wealth factor in 
the present case in a footnote, flouting Trinity and the United 
States Supreme Court cases.  The majority opinion states simply 
that "it is not significant in this case."  Majority op., ¶70 
n.25.  Why is the wealth of First American not significant in 
this case?  The majority opinion does not explain, other than to 
cryptically state that "[t]he record indicates that First 
American would likely be able to pay the amount specified by the 
jury."  Id.  Is the majority opinion implying that First 
American's ability to pay means the punitive damages were too 
low or that the punitive damages can never be high enough to 
deter First American's misconduct in the future?  Is First 
American too big, too well-to-do to punish? 
* * * * 
 
¶121 The majority opinion has ignored and misapplied the 
Trinity test to substantially similar facts in the present case 
and reaches an outcome contrary to Trinity. 
¶122 The majority opinion achieves a result in which the 
wrongdoer is enriched by its wrongdoing.  First American ends up 
paying less in damages for acting improperly than it would have 
paid had it acted properly and paid the claim.  This result, in 
my opinion, cannot stand. 
 
¶123 For the foregoing reasons, I dissent. 
                                                 
21 Trinity, 261 Wis. 2d 333, ¶69 n.8. 
No.  2011AP1514.ssa 
 
19 
 
 
¶124 I am authorized to state that Justice ANN WALSH 
BRADLEY joins this dissent. 
 
No.  2011AP1514.ssa 
 
1