Title: Karen R. Yocherer v. Farmers Insurance Exchange

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2002 WI 41 
 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
00-0944 
 
 
COMPLETE TITLE: 
 
 
Karen R. Yocherer and Lance H. Yocherer,  
 
Plaintiffs-Respondents, 
 
v. 
Farmers Insurance Exchange,  
 
Defendant-Appellant-Petitioner. 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
Reported at:  243 Wis. 2d 115, 627 N.W.2d 547 
(Ct. App. 2001-Unpublished) 
 
 
OPINION FILED: 
April 30, 2002   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
November 6, 2001   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Washington   
 
JUDGE: 
Leo F. Schlaefer   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the defendant-appellant-petitioner there were briefs by 
Douglas J. Carroll, Timothy D. Pagel and O'Neill, Schimmel, 
Quirk & Carroll, S.C., Milwaukee, and oral argument by Douglas 
J. Carroll. 
 
For the plaintiffs-respondents there was a brief by William 
G. Ladewig, Sharon K. Iggens and Ladewig and Rechlicz, Menomonee 
Falls, and oral argument by William G. Ladewig. 
 
 
2002 WI 41 
NOTICE 
This opinion is subject to further 
editing and modification.  The 
final version will appear in the 
bound 
volume 
of 
the 
official 
reports.   
No.  00-0944  
(L.C. No. 
97 CV 217) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Karen R. Yocherer and Lance H. Yocherer,  
 
          Plaintiffs-Respondents, 
 
     v. 
 
Farmers Insurance Exchange,  
 
          Defendant-Appellant-Petitioner. 
 
FILED 
 
APR 30, 2002 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed.   
 
¶1 
WILLIAM A. BABLITCH, J.   Farmers Insurance Exchange 
(Farmers) petitions this court to review a decision of the court 
of appeals which held that, in this underinsured motorist claim, 
the date of the accident is not necessarily the date of loss for 
purposes of seeking coverage under the insurance contract within 
the statute of limitations.  Here, Karen and Lance Yocherer did 
not make a claim against their underinsured carrier, Farmers, 
until all claims against the tortfeasors were settled and their 
carrier terminated arbitration proceedings against them.  The 
court of appeals concluded that the action was timely filed, 
measuring from the date of termination of the arbitration.  We 
No. 
00-0944   
 
2 
 
agree that the action was commenced within the statute of 
limitations, but we conclude the appropriate date of loss was 
the date of settlement with the tortfeasors.  For actions 
seeking coverage under an underinsured motorist policy, the 
statute of limitations begins to run from the date of loss, 
which is the date on which a final resolution is reached in the 
underlying claim against the tortfeasor, be it through denial of 
that claim, settlement, judgment, execution of releases, or 
other form of resolution, whichever is the latest.  Accordingly, 
we affirm.   
I 
¶2 
On October 22, 1987, Karen Yocherer was injured in an 
automobile accident caused by the alleged negligence of two 
other drivers, Katherine Noyes and Jeffrey Barnes.  At that 
time, Yocherer was insured under an automobile insurance policy 
issued by Farmers, which contained an underinsured motorist 
coverage provision.1  Barnes was also insured by Farmers.  Noyes 
was insured by American Family.     
                                                 
1 The terms of the uninsured/underinsured motorist insurance 
coverage were as follows: 
Coverage C – Uninsured Motorist Coverage (Including 
Underinsured Motorists Coverage): 
We will pay all sums which an insured person is 
legally entitled to recover as damages from the owner 
or operator of an uninsured motor vehicle because of 
bodily injury sustained by the insured person.  The 
bodily injury must be caused by accident and arise out 
of the ownership, maintenance or use of the uninsured 
motor vehicle.   
No. 
00-0944   
 
3 
 
¶3 
On February 16, 1995, Yocherer settled her claims 
against Barnes and Noyes and reserved any claims she might have 
under her own underinsured motorist policy with Farmers.  She 
then conducted settlement negotiations with Farmers that proved 
unsuccessful.  Pursuant to the policy, the parties then 
commenced arbitration proceedings.  On February 12, 1997, almost 
nine and one-half years after the accident, Farmers terminated 
the arbitration process and advised her that the statute of 
limitations under Wis. Stat. § 893.43 (1997-98)2 had expired.  
This statute requires that an action upon a contract be 
commenced within six years after the cause of action accrues.   
¶4 
On May 16, 1997, Karen and Lance Yocherer (Yocherers) 
filed a complaint against Farmers in Washington County Circuit 
Court.  The Yocherers alleged claims of bad faith, breach of 
contract, declaratory relief, and estoppel.  Farmers answered 
and asserted affirmative defenses based on the statute of 
limitations, estoppel, and laches.   
¶5 
Farmers then moved for dismissal.  Farmers argued that 
the statute of limitations under Wis. Stat. § 893.43 barred the 
Yocherers' action.  It contended that the Yocherers' rights 
under their underinsured motorist coverage accrued upon the 
                                                                                                                                                             
Determination as to whether an insured person is 
legally entitled to recover damages or the amount of 
damages shall be made by agreement between the insured 
person and us.  If no agreement is reached, the 
decision will be made by arbitration. 
2 All subsequent references to the Wisconsin Statutes are to 
the 1997-98 version unless otherwise indicated.   
No. 
00-0944   
 
4 
 
injury, that is the date of the accident, at which time there 
was a presentable claim even though no breach of contract.  As a 
result, the Yocherers' action was untimely because it was 
brought more than nine years after the date of the accident.  
Farmers also argued that the doctrines of laches and equitable 
estoppel barred the Yocherers' action.  
¶6 
In response, the Yocherers argued that the statute of 
limitations commenced on February 12, 1997, the date on which 
Farmers allegedly breached the insurance contract by terminating 
the arbitration proceedings.  The Yocherers argued that, until 
Farmers effectively denied the requested underinsured motorist 
benefits, they did not have a viable claim for breach of 
contract.  They also argued that the doctrines of laches and 
equitable estoppel did not apply because again, before February 
12, 1997, there was no indication that Farmers had breached the 
insurance policy contract by refusing to pay underinsured 
motorist coverage benefits.  Therefore, their action was timely 
filed.   
¶7 
The 
circuit 
court, 
the 
Honorable 
Leo 
Schlaefer 
presiding, denied Farmers' motion to dismiss.  The court noted 
that neither party disputed that the underinsured claim was in 
contract and that the six-year statute of limitations applied.  
Therefore, the only question was when the statute of limitations 
commenced.  The court recognized the concerns of Farmers, 
stating that, if the date of loss was not the date of accident, 
delays could theoretically occur in asserting and resolving 
underinsured motorist coverage claims.  Nevertheless, the court 
No. 
00-0944   
 
5 
 
relied on Abraham v. General Casualty Co., 217 Wis. 2d 294, 576 
N.W.2d 46 (1998), and held that a contract cause of action 
accrued at the time that the contract was breached, which in 
this case was the time at which Farmers terminated the 
arbitration proceedings.  The court found no basis for Farmers' 
laches or equitable estoppel claims, concluding that the record 
lacked any showing that Farmers breached any insurance policy 
contract prior to February 12, 1997.  The court then ordered the 
parties to proceed with arbitration, and the arbitrators ruled 
in favor of the Yocherers.  The circuit court then affirmed that 
award and entered judgment in favor of the Yocherers.  Farmers 
appealed. 
¶8 
The court of appeals affirmed in an unpublished 
opinion.  Like the circuit court, the court of appeals relied on 
Abraham. 
 
The 
court 
of 
appeals 
concluded 
that 
Abraham 
unequivocally stated that a breach of contract occurs when the 
insurer denies underinsured motorist benefits requested from an 
insured.  Based on this conclusion, the court held that Farmers 
had breached its contract when it advised Karen Yocherer on 
February 12, 1997, that it would no longer consider her claim 
because the statute of limitations had expired.  The statute of 
limitations, the court concluded, began running on that date.  
As a result, the Yocherers' breach of contract action against 
Farmers was commenced within the six-year statute of limitations 
under Wis. Stat. § 893.43. 
II 
No. 
00-0944   
 
6 
 
¶9 
We address two issues.  First, we examine whether the 
Yocherers' action was timely filed under Wis. Stat. § 893.43.  
Second, we examine whether the action is barred under the 
doctrines of laches and equitable estoppel.   
A.  Statute of Limitations 
¶10 The parties do not dispute that the applicable statute 
of limitations is Wis. Stat. § 893.43, which states that "[a]n 
action upon any contract . . . shall be commenced within 6 years 
after the cause of action accrues or be barred."  Thus, as the 
court of appeals recognized, the issue is when does a cause of 
action accrue against an underinsured motorist carrier for 
coverage under the policy.  This question requires that we 
interpret both the statute and the insurance policy, which are 
questions of law that we decide de novo.  Magyar v. Physicians 
Ins. Co., 2001 WI 41, ¶8, 242 Wis. 2d 491, 625 N.W.2d 291. 
¶11 Farmers asserts that the decisions from the circuit 
court and the court of appeals both ignore the longstanding rule 
established prior to Abraham that, when the contract involved is 
an insurance policy, a cause of action on the policy accrues on 
the date of loss for purposes of Wis. Stat. § 893.43.  Farmers 
specifically relies on Gamma Tau Educational Foundation v. Ohio 
Casualty Insurance Co., 41 Wis. 2d 675, 680, 165 N.W.2d 135 
(1969).  Farmers argues that the date of the loss in Yocherers' 
case was, pursuant to the language of the policy, the date of 
the accident.  Our holding in Abraham, Farmers contends, should 
not and cannot be read as overruling this longstanding rule.  If 
it must be read in this manner, Farmers asks us to overrule 
No. 
00-0944   
 
7 
 
Abraham because the rule of law under Abraham makes bad law, 
violates common sense, and contravenes the public policy and 
legislative intent expressed in the statute of limitations.  
¶12 Gamma Tau involved an action brought under a general 
liability policy.  Specifically, the insured chapter house of a 
fraternity brought an action on an insurance policy seeking 
recovery for damages sustained after an employee of the chapter 
embezzled $12,000.  Gamma Tau, 41 Wis. 2d at 677-78.  The policy 
protected the chapter house against "'loss of money, securities 
and other property which the insured shall sustain through any 
fraudulent or dishonest act or acts committed by any of the 
employees.'"  Id. at 678.  This court examined whether the 
action was timely commenced under the applicable statute of 
limitations, which, like here, provided for a six-year period 
within which to bring an action upon a contract.  Id. at 680.  
We noted that "[t]he general rule is that the right of action of 
the insured accrues against the insurer on the date of the 
loss."  Id. (citing Rock County Sav. & Trust Co. v. London 
Assurance Co., 17 Wis. 2d 618, 620, 117 N.W.2d 676 (1962)).  We 
concluded that the action was untimely, measuring from the date 
that the employee's thefts occurred.  Id. at 680, 684.  In other 
words, we concluded that the date of the loss——the date of the 
last known theft——controlled.  In the process, we rejected the 
plaintiff's claims that the statute of limitations should be 
measured from the date of the discovery of the employee's thefts 
or from the date of the discovery of the policy.  Id. at 680-83.  
We also rejected the plaintiff's argument that the statute of 
No. 
00-0944   
 
8 
 
limitations did not begin to run until all the conditions 
precedent to the commencement of a suit had been met.  Id. at 
681-82.   
¶13 In Effert v. Heritage Mutual Insurance Co., 160 
Wis. 2d 520, 527, 466 N.W.2d 660 (Ct. App. 1990), the court of 
appeals addressed a statute of limitations question involving an 
uninsured motorist policy.  In that case, Effert was involved in 
an automobile accident with another driver.  Id. at 523.  Effert 
settled a claim with her insurer for personal property damage 
and then commenced an action against the owner of the other 
vehicle and his insurer for damages sustained as a result of the 
accident.  Id.  After learning that the owner's insurer was 
insolvent, Effert then submitted a claim with her insurer under 
the uninsured motorist provision of her policy.  Id.  After some 
negotiation, Effert's insurer advised her that it would no 
longer consider her claim because the six-year statute of 
limitations had expired.  Id.  Effert made a written demand to 
the owner's insurer for arbitration, but it refused and the 
circuit court dismissed Effert's action to compel the owner's 
insurer to arbitrate.  Id. at 523-24.   
¶14 The issue was "when the statute of limitations 
commenced on Effert's claim arising under the uninsured motorist 
provisions of her insurance contract."  Id. at 524.  The court 
rejected the argument that the statute of limitations, as it 
applied to Effert's insurer, began to run on the date of the 
accident.  Id. at 525.  The court then noted as follows: 
 
No. 
00-0944   
 
9 
 
 
We 
perceive 
two 
distinct 
and 
conflicting 
approaches 
to 
determining 
when 
the 
statute 
of 
limitations commenced.  Under basic contract analysis, 
the cause of action accrued and the statute began to 
run when Heritage [Effert's insurer] breached the 
contract by refusing to arbitrate Effert's claim [in 
1990].  However, there is also support for the 
proposition that the statute of limitations begins to 
run on an insurance action when the insured first has 
a claim against the insurer.  Under this latter 
analysis, Effert first had a claim against Heritage 
when Iowa [the owner's insurer] became insolvent in 
1985.  Because under either analysis no statute of 
limitations bars Effert's claim, it is unnecessary to 
decide which is the correct analysis. 
 
 
Turning first to contract, we note that a 
contract claim arises when the contract is breached.  
Segall 
v. 
Hurwitz, 
114 
Wis. 2d 471, 
490, 
339 
N.W.2d 333, 343, (Ct. App. 1983).  Heritage breached 
the insurance contract when it refused to arbitrate 
Effert's 
claim 
as 
required 
under 
the 
insurance 
contract. 
 Under 
contract analysis this 
conduct 
commenced the statute of limitations because it was 
then that Heritage refused to comply with the terms of 
the insurance contract with Effert. 
 
 
. . . . 
 
 
[Alternatively, i]n Gamma Tau Educ. Found. v. 
Ohio 
Cas. 
Ins. 
Co., 
41 
Wis. 2d 675, 
680, 
165 
N.W.2d 135, 137, (1969), the court held that the 
insured's right of action against the insurer accrued 
on the date of loss.  We read that case to mean that 
the cause of action accrued when the insured first had 
a 
claim 
against 
the 
insurer. 
 
We 
make 
this 
interpretation because a cause of action accrues when 
there is a claim capable of present enforcement.  Les 
Moise, 122 Wis. 2d at 57, 361 N.W.2d at 656.  In Gamma 
Tau, the date of loss marked when the insured could 
submit a claim to the insurer.  In the present case, 
Effert could not have sought recovery from Heritage 
until Iowa became insolvent because no claim under the 
uninsured motorist coverage had yet accrued.  We 
therefore read "date of loss" to be when a presentable 
claim existed.  In many cases these dates will be 
contemporaneous, but in this case they are different. 
No. 
00-0944   
 
10 
 
Id. at 525, 527 (emphases added).  Effert recognized that the 
Gamma Tau date of loss requirement did not necessarily mean the 
date of the accident.  Instead, the date of loss meant the date 
on which a claim may be brought.   
¶15 In 
Abraham, 
we 
examined 
a 
similar 
statute 
of 
limitations question for 
an 
underinsured motorist policy.  
Abraham was injured when he was struck by an automobile while 
riding his bicycle.  Abraham, 217 Wis. 2d at 297-98.  At that 
time, Abraham was insured under an underinsured automobile 
insurance policy by General Casualty.  Id. at 298.  The policy 
stated that General Casualty agreed to pay underinsured motorist 
coverage only after the limits of any applicable liability 
policy had been exhausted by payment of judgment or settlement.  
Id.  After negotiating with the tortfeasor's insurer (State 
Farm), Abraham notified General Casualty in a September 25, 1990 
letter that he intended to settle for the full amount of the 
tortfeasor's liability policy and to seek no-fault liability 
benefits from State Farm.  Id.  In this same letter, Abraham 
asked his insurer to pay State Farm's liability policy limits 
and the no-fault benefits.  Id.  Approximately two weeks later, 
on October 8, 1990, General Casualty sent a letter to Abraham 
refusing 
to 
pay 
State 
Farm's 
policy 
limits 
and 
granted 
permission for Abraham to accept the policy limits provided by 
State Farm.  Id. at 298-99.  General Casualty then refused to 
pay Abraham's underinsured motorist benefits, which prompted 
Abraham to commence an action against General Casualty on 
September 30, 1994.  Id. at 299.  The action sought a judgment 
No. 
00-0944   
 
11 
 
declaring 
that 
the 
policy 
provided 
underinsured 
motorist 
coverage and an order requiring General Casualty to arbitrate in 
good faith.  Id.   
¶16 General Casualty moved to dismiss arguing that the 
applicable 
statute 
of 
limitations 
had 
expired. 
 
Id.  
Specifically, it alleged that Abraham's lawsuit was a "foreign 
cause of action" within the meaning of Wisconsin's borrowing 
statute and that Florida's five-year statute of limitations for 
actions upon contract should therefore apply to render Abraham's 
suit untimely.  Id.  We concluded, however, that the borrowing 
statute did not apply to Abraham's claim, and we therefore 
examined Wis. Stat. § 893.43 (1993-94) to determine whether the 
action was timely commenced.  Id. at 313.  We concluded as 
follows: 
 
As 
mentioned 
above, 
the 
alleged 
breach 
of 
contract by General Casualty occurred at the earliest 
in October 1990.  Abraham subsequently filed his claim 
on September 30, 1994.  Therefore, Abraham's action 
falls well within the six-year period provided under 
Wisconsin law, see CLL Assocs. Ltd. Partnership v. 
Arrowhead Pacific Corp., 174 Wis. 2d 604, 607, 497 
N.W.2d  115 (1993) (holding that a contract cause of 
action under Wis. Stat. § 893.43 accrues at the moment 
the contract is breached), and his cause of action for 
breach of contract may proceed accordingly.   
Id.   
¶17 Abraham did not overrule the existing rule of law for 
insurance policies, i.e., that the date of the loss controls.  
Although Abraham's reliance on CLL Associates, which involved a 
claim on a construction contract not an underinsured motorist 
policy, may have been misplaced, the court pointed to the 
No. 
00-0944   
 
12 
 
correct date on which the statute of limitations began to run.  
That date was the date of the loss, that is, the date on which a 
presentable claim existed for Abraham against his insurer.  For 
claims seeking underinsured motorist coverage, the date on which 
a presentable claim exists is the date on which the insured 
resolves his or her claims against the tortfeasors, whether it 
was by settlement or judgment or another form of final 
resolution.  In Abraham, no formal settlement or judgment was 
entered.  However, in its October 1990 letter, General Casualty 
implicitly 
recognized 
a 
settlement 
by 
granting 
Abraham 
permission to accept State Farm's policy limits.  Thus, the 
earliest date that Abraham may have had a presentable claim was 
on that date, which still would have been within the statute of 
limitations.   
¶18 Farmers argues that the date of loss was the date of 
the accident because the Yocherers could have taken immediate 
action on their policy for uninsured motorist coverage for the 
damages sustained by both Noyes and Barnes.  Farmers contends 
that the existence of other insured motorists did not preclude 
the Yocherers from making a claim for uninsured motorist 
coverage and that the Yocherers did not have to show that there 
was no other available liability insurance to collect on their 
uninsured motorist policy. 
¶19 It also points to the following policy language: 
 
Additional Definitions Used In This Part Only 
 
As used in this part: 
 
No. 
00-0944   
 
13 
 
. . .  
 
3. 
Uninsured motor vehicle means a motor vehicle which 
is: 
 
. . .  
 
b.  Insured by a bodily injury liability . . . policy 
at the time of the accident which provides coverage in 
amounts less than the limits of Uninsured Motorist 
Coverage shown in the Declarations. 
Farmers argues that underinsured motor vehicles are included 
under this definition and asserts that, as of the date of the 
accident, both tortfeasors' vehicles were underinsured motor 
vehicles under this definition because the Yocherers knew that 
their damages would exceed the tortfeasors' insurance coverage.  
In turn, Farmers contends that the Yocherers had an immediate 
right and cause of action on the underinsured motorist policy 
following the accident. 
¶20 We do not construe the policy language cited by 
Farmers as requiring this action to be commenced on the date of 
the accident.  The language does not specifically require the 
filing of a claim at the time of the accident.  Further, the 
facts, as they were presented at the time of the accident, did 
not lend themselves to a presentable claim.  An insured should 
not be required to proceed at the time of the accident under his 
or her underinsured motorist policy without any knowledge of the 
underlying tortfeasors' liability or coverage or the insured's 
own potential contributory negligence.  For these reasons, we 
conclude that the cause of action in this case appropriately 
No. 
00-0944   
 
14 
 
accrued on the date on which there was a presentable claim, 
which was the date of the settlement.3 
¶21 In this case, the Yocherers are specifically seeking 
benefits under their underinsured motorist provision of their 
policy.  Under this insurance provision, it must first be 
determined whether underinsured coverage even comes into play.  
To do this, it must be determined whether the insured is 
entitled to recover damages from the tortfeasor and whether the 
bodily injuries sustained by the insured arose out of the 
ownership, maintenance, or use of the tortfeasor's vehicle.  
Then it must be determined whether the insurance of the 
tortfeasor is insufficient to cover the loss.  Thus, the cause 
of action appropriately accrues at the time when there has been 
final resolution to the underlying tort claim. 
¶22 We hold that the date of loss for actions seeking 
coverage for underinsured motorist coverage is the date on which 
there has been a final resolution of the underlying claim with 
the tortfeasor, be it through denial of the claim, settlement, 
judgment, execution of releases, or other form of resolution.  
                                                 
3 Attention must be paid to the language of the policy.  We 
note that other policies have specifically required either 
judgment or settlement of underlying liability policies before 
coverage will be provided.  See Danbeck v. American Family Mut. 
Ins. Co., 2001 WI 91, ¶3, 245 Wis. 2d 186, 629 N.W.2d 150.  Such 
language provides a clear indication of when the policy comes 
into play and when a presentable claim exists for the insured.  
The record contains a policy endorsement containing such 
language; however, the endorsement is dated March 1992, well 
after the date of the accident in 1987.  For this reason, we do 
not consider it.   
No. 
00-0944   
 
15 
 
The date of settlement or judgment as the date of loss has been 
regarded as the fair rule of law.  Specifically, it has been 
stated that: 
 
Waiting until the point of settlement seems to 
balance the equities concerned by protecting insurance 
companies against stale claims, while satisfying the 
insurance carriers' desire to insure that all other 
avenues of recovery are exhausted before they become 
entangled in the issue.  It also gives insureds a 
reasonable opportunity to assess their claim.   
Jeffery A. Kelso and Matthew R. Drevlow, When Does the Clock 
Start Ticking?  A Primer on Statutory and Contractual Time 
Limitation 
Issues 
Involved 
in 
Uninsured 
and 
Underinsured 
Motorist Claims, 47 Drake L. Rev. 689, 696 (1999).  We agree 
with this reasoning.  Applying this standard to the current case 
shows that it was clearly within the statute of limitations:  
the date that the settlement was reached was on February 16, 
1995 and the current action was commended on May 16, 1997, 
clearly within the six-year statute of limitations. 
B.  Laches and Equitable Estoppel 
¶23 We next review whether the doctrines of laches or 
equitable estoppel bar the action in this case.  Farmers 
correctly contends that, under the doctrine of laches, if there 
is unreasonable delay, knowledge of the course of events and 
acquiescence therein, together with prejudice to the party 
asserting the defense, a claim is barred.  Paterson v. Paterson, 
73 Wis. 2d 150, 153, 242 N.W.2d 907 (1976).  Farmers bears the 
burden of showing that it was prejudiced by the delay.  Schultz 
v. Kuerschner, 1 Wis. 2d 509, 515, 85 N.W.2d 500 (1957).  
No. 
00-0944   
 
16 
 
Farmers cites generally to the history of this case to support 
its argument that the doctrine applies.  Specifically, it points 
to the formal pleading filed against the tortfeasors in which 
the Yocherers identified that their damages exceeded the 
liability coverage.  Farmers asserts that this shows that the 
Yocherers knew they had a presentable claim for underinsured 
motorist coverage during this time but did not take action on 
it.  Further, it contends that, because almost 10 years passed 
between the time of the accident and the filing of the action, 
there is significant prejudice to them in this case.   
¶24 We, however, agree with the circuit court and the 
court of appeals that, under the facts of this case, the 
doctrine does not apply because there is no evidence of 
unreasonable delay on the part of the Yocherers.  During the 
nine year period, the Yocherers informed Farmers that a claim 
against it would be taken at some point.  Further, Farmers was 
part of the underlying tort action the entire time.  Therefore, 
we conclude that Farmers failed to meet its burden in showing 
prejudice.  In addition, the Yocherers' decision to proceed with 
arbitration 
first, 
and 
then, 
at 
the 
conclusion 
of 
the 
arbitration, file an action against Farmers, constituted neither 
error nor delay.     
¶25 The doctrine of equitable estoppel "consists of action 
or nonaction on the part of the one against whom the estoppel is 
asserted which induces reliance thereon by another, either in 
the form of action or nonaction, to his detriment."  City of 
Milwaukee v. Milwaukee County, 27 Wis. 2d 53, 66, 133 N.W.2d 393 
No. 
00-0944   
 
17 
 
(1965).  Again, Farmers bears the burden of proving each element 
by clear and convincing evidence.  St. Paul Ramsey Med. Ctr. v. 
DHSS, 186 Wis. 2d 37, 47, 519 N.W.2d 681 (Ct. App. 1994).  In 
short, this doctrine does not apply in this case because Farmers 
has failed to meet its burden by providing facts to show that it 
relied upon any actions of the Yocherers to its detriment.  We 
again agree with the circuit court and the court of appeals that 
this claim is without merit. 
III 
¶26 In sum, we conclude that, under the facts of this 
case, the date of settlement was the appropriate date of loss 
for statute of limitations purposes.  Using this date, we 
conclude that the Yocherers' action was timely filed.  Thus, we 
affirm the court of appeals' decision that the Yocherers' action 
was commenced within the six-year statute of limitations under 
Wis. Stat. § 893.43.  The doctrines of laches and equitable 
estoppel do not apply. 
By the Court.—The decision of the court of appeals is 
affirmed. 
No. 
00-0944   
 
 
 
1