Title: DeWitt Ross & Stevens v. Galaxy Gaming and Racing Limited Partnership
Citation: 2004 WI 92
Docket Number: 2002AP000359
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: July 1, 2004

2004 WI 92 
 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
02-0359 
COMPLETE TITLE: 
 
 
DeWitt Ross & Stevens, S.C.,  
          Plaintiff-Respondent-Cross- 
          Appellant-Petitioner, 
 
     v. 
 
Galaxy Gaming and Racing Limited  
Partnership, and Galaxy Casinos, Inc.,  
          Defendants-Co-Appellants-Cross- 
          Respondents-Cross Petitioners, 
 
Southwest Florida Enterprises, Inc.,  
          Defendant-Appellant-Cross- 
          Respondent-Cross Petitioner. 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
2003 WI App 190 
Reported at:  267 Wis. 2d 233, 670 N.W.2d 74 
(Ct. App. 2003-Published) 
 
 
OPINION FILED: 
July 1, 2004   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
April 8, 2004   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Dane   
 
JUDGE: 
Maryann Sumi   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
ABRAHAMSON, C.J. concurs in part, dissents in 
part (opinion filed). 
 
DISSENTED: 
CROOKS, J., dissents in part, concurs in part 
(opinion filed). 
SYKES, J., joins dissent/concurrence.   
 
NOT PARTICIPATING: WILCOX and PROSSER, J.J., did not participate.   
 
 
 
ATTORNEYS: 
 
For 
the 
plaintiff-respondent-cross-appellant-petitioner 
there were briefs by Anthony R. Varda and DeWitt Ross & Stevens, 
S.C., Madison, and oral argument by Anthony R. Varda. 
 
 
2
 
For 
the 
defendants-co-appellants-cross-respondents-cross 
petitioners there were briefs by Robert H. Friebert, S. Todd 
Farris, Jennifer L. Bolger and Friebert, Finerty & St. John, 
S.C., Milwaukee, and oral argument by Robert H. Friebert. 
 
 
 
2004 WI 92 
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  02-0359  
(L.C. No. 
01 CV 891) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
DeWitt Ross & Stevens, S.C.,  
 
          Plaintiff-Respondent-Cross- 
          Appellant-Petitioner, 
 
     v. 
 
Galaxy Gaming and Racing Limited  
Partnership, and Galaxy Casinos, Inc.,  
 
          Defendants-Co-Appellants-Cross- 
          Respondents-Cross Petitioners, 
 
Southwest Florida Enterprises, Inc.,  
 
          Defendant-Appellant-Cross- 
          Respondent-Cross Petitioner. 
 
FILED 
 
JUL 1, 2004 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed in 
part, reversed in part and cause remanded. 
 
¶1 
ANN WALSH BRADLEY, J.  This case arises out of a 
dispute over the collection of a legal bill.  The petitioner, 
DeWitt Ross & Stevens, S.C., seeks review of a published 
decision of the court of appeals that affirmed in part and 
No. 
02-0359   
 
2 
 
 
reversed in part a judgment of the circuit court.1  DeWitt 
asserts that the court of appeals erred in denying it an award 
of prejudgment interest under the offer of settlement statutes, 
Wis. Stat. § 807.01(3) and 807.01(4).2   
¶2 
Cross-petitioners 
Galaxy 
Gaming 
and 
Racing 
L.P., 
Galaxy Casinos, Inc., and Southwest Florida Enterprises, Inc. 
also seek review of the court of appeals' decision.  They assert 
that the court erred in ruling that DeWitt made a valid Wis. 
Stat. § 807.01(3) offer of settlement.  Additionally, they 
contend that the court erred in concluding that Southwest's 
guaranty on behalf of Galaxy included a guarantee to pay 
interest due on the outstanding account, that DeWitt could 
charge interest retroactive to January 1, 1997, and that DeWitt 
could recover as statutory costs the expense of having both a 
videographer and a court reporter record the same deposition. 
¶3 
We conclude that DeWitt did not make a valid Wis. 
Stat. § 807.01(3) offer of settlement.3  We also conclude that 
                                                 
1 Dewitt v. Galaxy Gaming, 2003 WI App 190, 267 Wis. 2d 233, 
670 N.W.2d 74 (affirming in part and reversing in part a 
decision of the circuit court for Dane County, Maryann Sumi, 
Judge). 
2 All references to the Wisconsin Statutes are to the 2001-
02 version unless otherwise noted. 
3 DeWitt argues that the statutory 12 percent prejudgment 
interest is mandatory under Wis. Stat. § 807.01(4) and that the 
court of appeals erred by declining to stack it on top of the 
contractual 18 percent interest specified in DeWitt's retainer 
agreement.  Because we determine that DeWitt did not make a 
valid Wis. Stat. § 807.01(3) offer of settlement, we need not 
address this issue. 
No. 
02-0359   
 
3 
 
 
the court of appeals properly determined that Southwest's 
guaranty on behalf of Galaxy included a guarantee to pay 
interest, that DeWitt could charge interest retroactive to 
January 1, 1997, and that DeWitt could recover as statutory 
costs the expenses of both its videographer and court reporter.  
Accordingly, we affirm in part, reverse in part, and remand the 
cause to the circuit court. 
I 
¶4 
For over five years, the law firm of DeWitt Ross & 
Stevens, S.C. (hereinafter "DeWitt") provided legal services to 
Galaxy 
Gaming 
& 
Racing 
L.P. 
and 
Galaxy 
Casinos, 
Inc. 
(hereinafter collectively referred to as "Galaxy Partnership").  
The legal services were rendered in connection with Galaxy 
Partnership's litigation with the City of Hudson. 
¶5 
Galaxy Partnership sought to obtain approval for an 
Indian casino at the St. Croix Meadows dog track in Hudson.  As 
part of this effort, Galaxy Partnership negotiated an agreement 
with 
the 
City 
for 
governmental 
services. 
 
While 
Galaxy 
Partnership's application was awaiting final approval from the 
federal government, the City communicated with the government, 
indicating that it opposed the proposed casino.  In the federal 
government's decision denying approval of the casino, it cited 
the 
City's 
opposition 
as 
a 
factor. 
 
Galaxy 
Partnership 
considered the City's opposition a breach of the agreement and 
retained DeWitt to represent it.   
No. 
02-0359   
 
4 
 
 
¶6 
Fred Havenick, president of Galaxy Partnership, signed 
a retainer letter with DeWitt.4  The letter provided that DeWitt 
would bill Galaxy Partnership on a monthly basis for services 
rendered and expenses incurred.  It also indicated that the 
monthly statement would be payable upon receipt.  Finally, the 
letter stated that DeWitt "reserve[d] the right to charge 
interest at the rate of 18% per annum (1 1/2% per month) on all 
statements not paid within 20 days after their date."   
¶7 
Because Galaxy Partnership had no assets or means of 
earning income, the letter required payment of either a cash 
retainer in the amount of $25,000 or a guaranty of payment.  
Galaxy Partnership chose the latter option.  Havenick, the 
president of Galaxy Partnership, was also the president of 
Southwest Florida Enterprises, Inc (hereinafter "Southwest").  
The guaranty was executed by Southwest, which wholly owned 
Galaxy Casinos, the general partner of Galaxy Gaming (we will 
periodically refer to all three entities as simply "the 
Companies").   
¶8 
In his capacity as president of Southwest, Havenick 
signed the following guaranty, which was numbered page four of 
the retainer letter and executed simultaneously with it: 
The undersigned, for valuable consideration and the 
willingness of ... DeWitt, Ross & Stevens, S.C. to 
                                                 
4 We note that Fred Havenick was actually the president of 
Galaxy Casinos, not Galaxy Gaming.  However, Galaxy Casinos is 
the general partner of Galaxy Gaming.  Thus, for ease of 
reference, this opinion will refer to Havenick as president of 
Galaxy Partnership. 
No. 
02-0359   
 
5 
 
 
represent [Galaxy] Partnership, all of which inures to 
my benefit, hereby personally guaranties the timely 
and full payment of all statements for services 
rendered and disbursements/expenses incurred on behalf 
of [Galaxy] Partnership.  In the event of a failure of 
[Galaxy] Partnership to pay the monthly statements as 
they fall due, the undersigned agrees that the law 
firm[] may, in the first instance, look to the 
undersigned for payment without having to exercise or 
exhaust any remedies against [Galaxy] Partnership. 
 
¶9 
As legal services were provided, monthly statements 
were 
routinely 
submitted 
to 
Havenick. 
 
However, 
Galaxy 
Partnership did not stay current with its payments.  By November 
24, 1997, its unpaid bills totaled over $129,000.  DeWitt wrote 
Havenick, demanding payment in full of Galaxy Partnership's 
entire obligation by December 1, 1997.  In doing so, it alerted 
him that if payment were not timely made, DeWitt would charge 
the contractual 18 percent interest on the balance.   
¶10 Shortly after December 1, 1997, Galaxy Partnership 
made a $50,000 payment to DeWitt.  DeWitt responded to the 
payment by sending Havenick a letter dated December 8, 1997, in 
which it demanded payment of retroactive interest computed from 
January 1, 1997.5   At the time, Havenick did not object to the 
interest payment provision in the letter. 
 
¶11 Over the next two years, Galaxy Partnership continued 
to make occasional payments to DeWitt.  In those months when 
payment was made, DeWitt provided a payment application summary, 
indicating that the payments were applied first to accrued 
interest, then to principal.  Again, Havenick did not object.   
                                                 
5 It is unclear from the record why DeWitt chose January 1, 
1997 rather than some earlier date. 
No. 
02-0359   
 
6 
 
 
¶12 DeWitt submitted its final bill to Havenick at the 
conclusion of Galaxy Partnership's litigation with the City.  
The bill showed a total balance of $352,172.59, including 
$69,209.44 
of 
accrued 
interest. 
 
When 
payment 
was 
not 
forthcoming, DeWitt sued the Companies to enforce the retainer 
letter and guaranty, claiming $396,847.86, 
which included 
interest through April 1, 2001.   
¶13 On July 9, 2001, DeWitt made an offer of settlement 
pursuant to Wis. Stat. § 807.01(3).  The offer required payment 
of $370,000 in full to be made within 15 days of acceptance.  It 
stated: 
Plaintiff DeWitt Ross & Stevens, S.C. hereby offers to 
settle and release all claims in the above-captioned 
matter, 
including 
claims 
for 
costs, 
sanctions, 
attorneys fees and interest for payment to it from any 
of the above-named Defendants, or any combination of 
the above-named Defendants, in the amount of $370,000 
to be made within 15 days of acceptance of this offer.  
This offer shall expire within 10 days of this date, 
pursuant to Wis. Stat. § 807.01, and will not 
hereinafter be renewed. 
 
¶14 After the offer was rejected, DeWitt moved for summary 
judgment on the question of Southwest's liability under the 
guaranty for principal and interest due.  The circuit court 
determined 
that Southwest's 
obligation 
under 
the guaranty 
included payment of the contractual 18 percent interest.  It 
also concluded that DeWitt was entitled to recover interest on 
the unpaid balance from December 1, 1997, the date DeWitt 
informed the Companies that it would begin assessing interest.   
No. 
02-0359   
 
7 
 
 
 
¶15 The 
circuit 
court 
entered 
judgment 
against 
the 
Companies in the amount of $407,498.79, awarding double costs 
pursuant to Wis. Stat. § 807.01(3).  Although it concluded that 
the settlement offer was valid, the court declined to stack the 
statutory 12 percent prejudgment interest on top of the 
contractual 18 percent interest that DeWitt was entitled to 
receive.  The court also declined to award costs for a 
transcript of Havenick's videotaped deposition.  The Companies 
appealed and DeWitt cross-appealed.   
 
¶16 The court of appeals affirmed in part and reversed in 
part the decision of the circuit court.  DeWitt v. Galaxy 
Gaming, 2003 WI App 190, 267 Wis. 2d 233, 670 N.W.2d 74.  Like 
the circuit court, it held that Southwest was liable for the 
contractual 18 percent interest, that DeWitt was entitled to 
double costs, and that DeWitt's offer of settlement was valid.  
Id., ¶¶4, 29.  In discussing whether a Wis. Stat. § 807.01(3) 
offer of settlement may contain a 15-day payment condition, the 
court of appeals crafted a "reasonableness" test.  Id., ¶31.  It 
determined that a Wis. Stat. § 807.01(3) offer of settlement 
could contain such a condition provided that it was reasonable.  
Id. 
 
¶17 In addition, the court of appeals agreed with the 
circuit court that Dewitt could not stack the statutory 12 
percent prejudgment interest on top of its contractual 18 
percent interest.  Id., ¶63.  The court determined the effective 
rate of interest in this case to be 35.9 percent had DeWitt 
No. 
02-0359   
 
8 
 
 
prevailed.  Id., ¶56, n. 8.  It voiced concern that when faced 
with the prospect of incurring such interest, offerees might 
believe they have no choice but to capitulate.  Id., ¶65.  The 
court further determined that interest under the contract began 
to accrue on January 1, 1997, not December 1, 1997.  Id., ¶4.  
Finally, it concluded that the circuit court erroneously 
excluded the deposition transcript as an item of costs.  Id.  
II 
¶18 We review summary judgment decisions applying the same 
methodology as does the circuit court.  Lambrecht v. Estate of 
Kaczmarczyk, 2001 WI 25, ¶21, 241 Wis. 2d 804, 623 N.W.2d 751.  
In order to be entitled to summary judgment, the moving party 
must prove that no genuine issue exists as to any material fact 
and that it is entitled to judgment as a matter of law.  Id., 
¶24. 
 
¶19 Whether a settlement offer is valid for purposes of 
statutory 
prejudgment 
interest 
involves 
interpretation 
and 
application of Wis. Stat. § 807.01(3).  This presents a question 
of law subject to independent appellate review.  Meyer v. Sch. 
Dist. of Colby, 226 Wis. 2d 704, 708, 595 N.W.2d 339 (1999).   
¶20 In reviewing the scope of a guaranty and determining 
when payment of interest is due, we must interpret a contract.  
This too presents a question of law, subject to independent 
appellate review.  See N. States Power Co. v. Nat'l Gas Co., 
2000 WI App 30, ¶7, 232 Wis. 2d 541, 606 N.W.2d 613.   
No. 
02-0359   
 
9 
 
 
¶21 Finally, 
whether 
a 
stenographic transcript 
of a 
videotaped deposition is a necessary cost that should be awarded 
to a prevailing plaintiff is a matter within the circuit court's 
discretion.  We will uphold the circuit court's exercise of 
discretion, provided that it examined the relevant facts, 
applied a proper standard of law, and, using a demonstrated 
rational process, arrived at a conclusion that a reasonable 
judge could reach.  Mgmt. Computer Servs., Inc. v. Hawkins, Ash, 
Baptie & Co., 224 Wis. 2d 312, 330, 592 N.W.2d 279 (Ct. App. 
1998).   
III 
¶22 This case presents us with several issues.  We address 
first the validity of DeWitt's offer of settlement under 
Wis. Stat. § 807.01(3).  Next, we turn to questions pertaining 
to the interest due, that is, whether Southwest's guaranty 
included a guarantee to pay interest and whether DeWitt could 
charge interest retroactive to January 1, 1997.  Finally, we 
consider whether DeWitt could recover as statutory costs the 
expense of having both a videographer and a court reporter 
record the same deposition. 
¶23 Our discussion begins by examining the validity of 
DeWitt's statutory offer of settlement.  The Companies contend 
that the offer was not valid because in addition to a request 
No. 
02-0359   
 
10 
 
 
for a sum of money (including costs), it contained a condition 
requiring payment within 15 days of acceptance.6   
¶24 Wisconsin Stat. § 807.01, 
entitled 
"Settlement 
offers," creates certain statutory consequences for pretrial 
settlement negotiations between litigants.  If a party makes an 
offer that conforms to section 807.01, that offer is rejected, 
and the offeror recovers a more favorable judgment, then costs 
may be shifted or doubled, and prejudgment interest may be 
imposed.  
¶25 The relevant statutory scheme is set forth in three 
subparagraphs.  Wisconsin Stat. § 807.01(1) governs offers by 
the defendant to allow the plaintiff to take judgment against 
the defendant in the amount specified.  It provides: 
After issue is joined but at least 20 days before the 
trial, the defendant may serve upon the plaintiff a 
written offer to allow judgment to be taken against 
the defendant for the sum, or property, or to the 
effect 
therein 
specified, 
with 
costs.  
If 
the 
plaintiff accepts the offer and serves notice thereof 
in writing, before trial and within 10 days after 
receipt of the offer, the plaintiff may file the 
offer, with proof of service of the notice of 
acceptance, 
and 
the 
clerk 
must 
thereupon 
enter 
judgment accordingly.  If notice of acceptance is not 
given, the offer cannot be given as evidence nor 
mentioned on the trial.  If the offer of judgment is 
                                                 
6 In 
the 
alternative, 
the 
Companies 
maintain 
that 
Wis. Stat. § 807.01 is violative of due process because they are 
unable to ascertain whether or not a given offer will subject 
them to double costs and prejudgment interest.  Because we 
determine that a settlement offer that contains a condition of a 
deadline for payment does not entitle the plaintiff to the 
relief specified in Wis. Stat. § 807.01, we do not reach the 
Companies' due process argument. 
No. 
02-0359   
 
11 
 
 
not accepted and the plaintiff fails to recover a more 
favorable judgment, the plaintiff shall not recover 
costs but defendant shall recover costs to be computed 
on the demand of the complaint. 
¶26 Wisconsin Stat. § 807.01(3) 
governs 
offers 
of 
settlement from the plaintiff to the defendant.  It provides:     
After issue is joined but at least 20 days before 
trial, the plaintiff may serve upon the defendant a 
written offer of settlement for the sum, or property, 
or to the effect therein specified, with costs.  If 
the defendant accepts the offer and serves notice 
thereof in writing, before trial and within 10 days 
after receipt of the offer, the defendant may file the 
offer, with proof of service of the notice of 
acceptance, with the clerk of court.  If notice of 
acceptance is not given, the offer cannot be given as 
evidence nor mentioned on the trial.  If the offer of 
settlement is not accepted and the plaintiff recovers 
a more favorable judgment, the plaintiff shall recover 
double the amount of the taxable costs.   
¶27 Wisconsin Stat. § 807.01(4) 
provides 
for 
the 
imposition of prejudgment interest: 
If there is an offer of settlement by a party under 
this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at the annual rate of 
12% on the amount recovered from the date of the offer 
of settlement until the amount is paid.  Interest 
under this section is in lieu of interest computed 
under sections 814.04(4) and 815.05(8). 
¶28 The statutory offer of judgment, now numbered Wis. 
Stat. § 807.01(1), has been available to Wisconsin defendants 
since 1858, with very little change in its language during the 
interceding century and a half.  See 1858 Wis. Laws 114 (Chapter 
97, published May 21, 1858).  It governs offers by the defendant 
No. 
02-0359   
 
12 
 
 
to allow the plaintiff to take judgment against the defendant in 
the amount specified.   
¶29 In 1971, Wis. Stat. § 807.01(3), the statute at issue 
in this case, was introduced by Assembly Bill 52, published May 
7, 1971.7  The drafting request indicates that it was created to 
be a mirror image of the statute now numbered Wis. Stat. 
§ 807.01(1).8   
¶30 At common law, parties were required to bear their own 
costs.9  Wisconsin Stat. § 807.01 is a cost-shifting statute and 
therefore is a statute in derogation of the common law.  
Statutes in derogation of the common law must be strictly 
construed.  See, e.g., Hoffmann v. Wis. Elec. Power Co., 2003 WI 
64,  ¶13, 262 Wis. 2d 264, 664 N.W.2d 55; Wis. Bridge & Iron Co. 
v. Indus. Comm'n, 233 Wis. 467, 474, 290 N.W. 199 (1940); Meek 
v. Pierce, 19 Wis. 300, 303 (1865).   
 ¶31  Consequently, Wisconsin courts have construed the 
statute very strictly.  For example, in Nicholson v. Home Ins. 
Cos., Inc., the court strictly construed the first four words of 
                                                 
7 The statute was then numbered Wis. Stat. § 269.02(3). 
8 Drafting Records of Assembly Bill 52, LRB 611.  "Have 
plaintiff offer of settlement.  If made & refused, & Pl 
recovers, Pl t rcv double dams.  (Reverse of 269.02(1)  Settle 
in 10 days after receipt of offer.  (Use subsection titles 
here.)"  (Punctuation, abbreviation, and emphasis as contained 
in the original document). 
9 Wisconsin Dep't of Transp. v. Wis. Personnel Comm'n, 176 
Wis. 2d 731, 736, 500 N.W.2d 664 (1993) (citing Noyes v. State, 
46 Wis. 250, 251-52, 1 N.W. 1 (1879) ("At the common law, costs 
were unknown.  Costs are altogether the creature of statute.")). 
No. 
02-0359   
 
13 
 
 
the section, "after issue is joined."  137 Wis. 2d 581, 606, 405 
N.W.2d 327 (1987).  An offer made prior to the commencement of 
the action was determined to be invalid.  Id. at 606-07. 
Likewise, an offer made after both parties stipulated to entry 
of a stay in an arbitration was invalid, because it did not take 
place during the pendency of an action and therefore was not 
"after issue [was] joined."  Briggs v. Farmers Ins. Exchange, 
2000 WI App 40, ¶17, 233 Wis. 2d 163, 607 N.W.2d 670.  
¶32 The remainder of the statutory language has been 
similarly strictly construed.  As indicated in the statute, and 
reiterated by this court, an offer must be written.  Nicholson, 
137 Wis. 2d at 606.  It must be served upon the defendant.  In 
Tullgren v. Karger, we explained that this requirement could not 
be satisfied by an offer contained in the answer.  173 Wis. 288, 
295, 181 N.W. 232 (1921).  
¶33 If the offer is not accepted within the limited time 
period, it must be withdrawn from all consideration of the court 
and cannot be used in evidence in any way, nor can it be 
subsequently accepted.  Id.  Double costs and interest may not 
be imposed unless an actual judgment is entered in a case.  
Osman v. Phipps, 2002 WI App 170, ¶12, 256 Wis. 2d 589, 649 
N.W.2d 701. 
¶34 Additionally, we have further circumscribed offers of 
settlement.  They must be absolutely unambiguous.  Stan's 
Lumber, Inc. v. Fleming, 196 Wis. 2d 554, 576, 538 N.W.2d 849 
(Ct. App. 1995).  This court has approved a simple standard for 
No. 
02-0359   
 
14 
 
 
assessing whether or not an offer under Wis. Stat. § 807.01 is 
unambiguous:  the offer must allow the defendant to fully and 
fairly evaluate his or her own exposure to liability.  Prosser 
v. Leuck, 225 Wis. 2d 126, 137, 592 N.W.2d 178 (1999).10  Offers 
made to multiple defendants or by multiple plaintiffs have, in 
some instances, been determined to be ambiguous.  See, e.g., 
D'Huyvetter v. A.O. Smith Harvestore Prods., 164 Wis. 2d 306, 
341-42, 475 N.W.2d 587 (Ct. App. 1991); DeMars v. LaPour, 123 
Wis. 2d 366, 374-75, 366 N.W.2d 891 (1985). 
¶35 
In 
accord 
with 
this 
court's 
precedent 
strictly 
construing Wis. Stat. § 807.01, we look to the language of the 
statute to interpret and apply its express provisions.  Here, 
the language of § 807.01(3) allows an offer of settlement to 
seek three categories of relief.  The text provides: "the 
plaintiff may serve upon the defendant a written offer of 
settlement for the sum, or property, or to the effect therein 
specified, with costs."  In other words, the plaintiff's offer 
                                                 
10 Prosser cites to Testa v. Farmers Ins. Exchange, 164 Wis. 
2d 296, 302, 474 N.W.2d 776 (Ct. App. 1991) ("As can be seen 
from these cases, the appellate courts have developed a standard 
to determine the validity of an offer of settlement or offer of 
judgment for purposes of invoking the double costs and interest 
provisions of sec. 807.01, Stats., namely, in order for the 
offer to be effective, the offeree must be able to fully and 
fairly 
evaluate 
the 
offer 
from 
his 
own 
independent 
perspective.").  Prosser v. Leuck, 225 Wis. 2d 126, 137, 592 
N.W.2d 178 (1999).  In Prosser, the plaintiff offered to settle 
"in exchange for the defendant's payment" of $99,750 "cash, plus 
the actual costs of this action."  No objection was raised to 
the plaintiff actually requiring payment to settle the case. 
No. 
02-0359   
 
15 
 
 
may demand payment of a sum of money, the transfer of property, 
or other specified relief sought in the action.11   
¶36  We note that there is nothing in the language of Wis. 
Stat. § 807.01 that authorizes conditions on payment like the 
15-day 
payment 
provision 
here. 
 
Therefore, 
in 
strictly 
construing the express terms of the section, we determine that 
the condition may not be imposed.   
¶37 This determination is consistent with the statutory 
scheme.  Wisconsin Stat. § 807.01(3) provides in part:  "If the 
offer of settlement is not accepted and the plaintiff recovers a 
more favorable judgment, the plaintiff shall recover double the 
amount of taxable costs."  The payment condition set forth in 
the DeWitt offer of settlement was "payment . . . to be made 
within 15 days of acceptance of this offer."  Because a judge 
could not enter a judgment ordering payment within 15 days, 
                                                 
11 This court has not previously discussed the nature of the 
other specified relief.  It applies to offers of settlement in 
cases where some component of the relief sought is other than 
money or property. 
FRCP 68 is the Federal Rules' equivalent of Wis. Stat. 
§ 807.01(1), and is descended from the same New York statute 
from which 807.01 traces its lineage.  Pursuant to Rule 68, a 
defendant may offer to allow a plaintiff to take judgment 
against it for "money or property or to the effect specified, 
with costs."  Federal courts have construed the rule as 
encompassing offers to allow judgment for a wide variety of 
injunctive relief.  See, e.g., Liberty Mut. Ins. Co. v. EEOC, 
691 F.2d 438, 442 (9th Cir. 1982) (demand that certain 
information not be disclosed); Lightfoot v. Walker, 619 F. Supp. 
1481, 1485-86 (S.D.Ill. 1985) (demand for specific prison health 
care reform); Mr. Hanger, Inc. v. Cut Rate Plastic Hangers, 
Inc., 63 F.R.D. 607, 609 (E.D.N.Y. 1974) (demand for cessation 
of patent infringement). 
No. 
02-0359   
 
16 
 
 
DeWitt is unable to meet the Wis. Stat. § 807.01(3) requirement 
of obtaining a "more favorable judgment." 
¶38 This court has previously noted that "the purpose of 
Wis. Stat. § 807.01 is to encourage settlement and accordingly, 
secure just, speedy and inexpensive determinations of disputes."  
Prosser, 225 Wis. 2d at 140.  As befits a statute intended to 
expedite the resolution of disputes, the language of Wis. Stat. 
§ 807.01 reflects a concern with finality and ease of proof. 
¶39 If Wis. Stat. § 807.01 is to fulfill its purpose, 
litigants must have clear guidance about the proper scope of a 
valid offer.  A clear rule will help parties draft valid offers 
and assess their potential exposure to costs and prejudgment 
interest.  Moreover, it will expedite dispute settlement by 
minimizing the need for post-trial litigation about rejected 
settlement offers.  We further note that Wis. Stat. § 807.01(1) 
and 807.01(3) provide:  "If notice of acceptance is not given, 
the offer cannot be given as evidence nor mentioned on the 
trial . . ."; a clear rule is therefore uniquely appropriate 
here because the parties may not obtain a ruling on the validity 
of the offer during trial. 
¶40 In the absence of a clear rule, adjudicated cases 
involving a Wis. Stat. § 807.01 offer may require additional 
post-trial collateral litigation.  Payment within 15 days may be 
reasonable in one case but not in another, or reasonable in one 
courtroom but not in another.  Payment within 15 days may be 
reasonable in one case but not in another, or reasonable to one 
No. 
02-0359   
 
17 
 
 
defendant but not to another.  If parties cannot know whether a 
given offer of settlement will be found valid without engaging 
in post-trial litigation, the statute will not encourage early 
and certain settlement. 
  
¶41 For these reasons, we reject the court of appeals' 
proposed 
"reasonableness" 
standard 
for 
assessing 
the 
permissibility of conditions contained in statutory offers of 
settlement.  As the Companies observed, settlement agreements 
often include terms such as payment schedules, confidentiality 
agreements, noncompete clauses, etc.12  Requiring courts to 
review the reasonableness of such conditions would mire them in 
a dismal swamp of collateral litigation.  Such a result would 
frustrate the purpose of the statute.   
 
¶42 Accordingly, we conclude that the test for whether a 
given provision may be included in a valid settlement offer is 
not whether the provision is "reasonable," but rather whether 
the provision specifies a remedy that could be imposed by the 
                                                 
12 Our opinion today is not intended to chill these 
settlement conditions.  Rather, it simply recognizes that the 
purpose of Wis. Stat. § 807.01 would be frustrated by the 
collateral litigation that the "reasonableness" test would 
generate.  
No. 
02-0359   
 
18 
 
 
court.13  This test obviates any inquiry into reasonableness and 
also facilitates judicial comparison of the offer to the 
judgment eventually obtained at trial.  In the case at bar, 
DeWitt demanded payment within 15 days of the offer.  Because a 
judge could not enter a judgment requiring that the defendant 
tender payment within 15 days, we conclude that DeWitt's offer 
was not valid, and DeWitt is therefore not entitled to double 
costs and prejudgment interest. 
IV 
¶43 We turn next to questions pertaining to the interest 
due, beginning with whether Southwest's guaranty included a 
guarantee to pay interest.  Southwest contends it did not, 
noting that the guaranty refers only to "the timely and full 
payment 
of 
all 
statements 
for 
services 
rendered 
and 
disbursements/expenses incurred on behalf of the Partnership." 
DeWitt counters that the guarantee of "timely and full payment" 
unambiguously guarantees payment for interest charges.  We 
conclude that the guaranty obligated Southwest for interest due 
on Galaxy Partnership's outstanding account.   
                                                 
13 The Companies argue that the imposition of any conditions 
on the offer of settlement renders it invalid under Wis. 
Stat. § 807.01.  Although this position would appear to address 
the concerns we have outlined above, the Companies' argument is 
too simplistic.  The statute authorizes settlement offers for 
property or equitable relief; it is in the nature of these types 
of relief that they are subject to a variety of conditions that 
may be imposed in the court's judgment.  Because a court may 
impose such conditions in a judgment, they may validly be set 
out in the offer of settlement.   
No. 
02-0359   
 
19 
 
 
¶44 A guaranty is a contract.  Klein-Dickert Oshkosh Inc. 
v. Frontier Mortgage Corp., 93 Wis. 2d 660, 668-69, 287 N.W.2d 
742 (1980).  "The ultimate aim of all contract interpretation is 
to ascertain the intent of the parties."  Eden Stone Co. v. 
Oakfield Stone Co., 166 Wis. 2d 105, 116, 479 N.W.2d 557 (Ct. 
App. 1991).  Contracts must be read in such a manner as to give 
a reasonable meaning to each provision and without rendering any 
portion superfluous.  Isermann v. MBL Life Assurance Corp., 231 
Wis. 2d 136, 153, 605 N.W.2d 210 (Ct. App. 1999).   
¶45 In this case, the retainer letter provided that 
DeWitt's "[S]tatements are payable upon receipt.  We reserve the 
right to charge interest at a rate of 18% per annum (1 1/2% per 
month) on all statements not paid within 20 days after their 
date."  As noted in the retainer letter, Galaxy Partnership was 
without resources to pay legal fees.  DeWitt therefore required 
that Southwest guarantee "timely and full payment of all 
statements for services rendered and disbursements/expenses 
incurred on behalf of [Galaxy Partnership]."  The guaranty was 
numbered page four of the retainer letter and executed by 
Havenick simultaneously with the retainer.  
 
¶46 Although 
Southwest 
guaranteed 
"timely 
and 
full 
payment," interest is admittedly not mentioned in the guaranty 
itself.  Therefore, the agreement is ambiguous with respect to 
Southwest's 
obligation 
to 
pay 
interest 
due 
on 
Galaxy 
Partnership's outstanding account.  "In determining the [meaning 
of ambiguous contract language], this court has held that it is 
No. 
02-0359   
 
20 
 
 
proper to 
consider 
the 
conduct of 
the parties and the 
negotiations which took place, both before and after the 
execution of the documents and to consider all related documents 
of the parties."  Smith v. Osborn, 66 Wis. 2d 264, 272, 223 
N.W.2d 913 (1974) (citations omitted). 
 
¶47 Here, we are satisfied that the conduct of the parties 
evinced an intent that Southwest was liable for the consequences 
of untimely and deficient payments.  If it were otherwise, 
Southwest's guarantee of "timely and full payments" would be 
rendered meaningless, as would the imposition of 18 percent 
interest on the partnership which had no assets.  Accordingly, 
we conclude that Southwest guaranteed that it would pay DeWitt 
interest on Galaxy Partnership's outstanding account. 
V 
 
¶48 Having determined that Southwest's guaranty included 
interest, we consider next whether DeWitt could charge interest 
retroactive to January 1, 1997.  The Companies assert that the 
court of appeals erred in awarding contract interest to DeWitt 
from January 1, 1997, the date from which DeWitt chose to impose 
interest on Galaxy Partnership's unpaid balance.  Under their 
argument, DeWitt was not entitled to charge interest until it 
notified the Companies that it intended to exercise its right to 
interest under the contract.  We reject the Companies' argument.  
 
¶49 As noted above, the retainer letter executed by DeWitt 
and Havenick states in pertinent part:  "You will receive a 
statement for services rendered and expenses incurred on a 
No. 
02-0359   
 
21 
 
 
monthly basis.  The statements are payable upon receipt.  We 
reserve the right to charge interest at the rate of 18% per 
annum (1 1/2 % per month) on all statements not paid within 20 
days after their date."  On November 24, 1997, DeWitt informed 
the Companies that "unless this account is paid off by December 
1, 1997, we will apply the 18% interest rate provided for in 
[the] December 6, 1995, contract with you." 
 
¶50 This 
court described 
the 
accepted 
practice 
with 
respect to accrual of interest in Estreen v. Bluhm, 79 Wis. 2d 
142, 158-59, 255 N.W.2d 473 (1977).  There, consistent with a 
series of 
earlier 
precedent,14 
this 
court 
held 
that the 
defendants were entitled to interest from the date on which the 
plaintiffs were supposed to pay their obligation under an 
agreement to purchase land.  It explained:  
The general rule as to the time at which interest 
begins to run on a liquidated claim is that the 
creditor is entitled to interest from the time payment 
was due by the terms of the contract and, if no such 
                                                 
14 See, e.g., In re Oconto County State Bank, 241 Wis. 369, 
6 N.W.2d 353 (1942) ("The rule of course is that the debtor 
should pay interest from the time when he ought to have paid the 
debt."); Vogt v. Calvary Lutheran Univ. Missionary Soc., 213 
Wis. 380, 388, 251 N.W. 239 (1933) ("The established rule is 
that when the time of payment is specified by the terms of a 
contract, then interest is to be computed from the time that 
payment was due by those terms."); Necedah Mfg. Co. v. Juneau 
County, 206 Wis. 316, 329, 237 N.W. 277 (1931) ("[T]he creditor 
is 
entitled 
to 
interest . . . 
from 
the 
time 
payment 
or 
performance was due by the terms of the contract, or, if that 
was not specified, then from the time that demand was made, and 
if no demand was made prior to the time of the commencement of 
the action, then from that time.").  
 
No. 
02-0359   
 
22 
 
 
time is specified, then from the time a demand was 
made and, if no demand was made prior to the time of 
commencement of action, then from that time.    
Id.  Therefore, in order to determine the date from which the 
creditor is entitled to interest, we first examine the contract 
to ascertain whether it specifies a time at which performance or 
payment of the underlying debt is due.   
 
¶51 Here, it is uncontested that the terms of the retainer 
letter required payment upon receipt of the monthly statements 
and specified that interest would accrue if payment was not 
received within twenty days.  Applying the general rule of 
Estreen, we conclude that DeWitt acted within the terms of its 
agreement when seeking interest retroactive to January 1, 1997, 
because DeWitt was entitled to interest from the time the 
statements were payable (that is, upon receipt).  
VI 
 
¶52 Finally, we examine whether DeWitt could recover as 
statutory costs the expense of having both a videographer and a 
court reporter record the same deposition.  The Companies 
maintain that it cannot.  Specifically, they contend that Wis. 
Stat. § 885.42(1) requires that a party arranging a simultaneous 
stenographic record do so at its own expense.  That statute 
provides that "any deposition may be recorded by audiovisual 
videotape without a stenographic transcript.  Any party to the 
action may arrange at the party's expense to have a simultaneous 
stenographic record made."  Wis. Stat. § 885.42(1) (emphasis 
added). 
No. 
02-0359   
 
23 
 
 
 
¶53 Under Wis. Stat. § 814.01(1), a prevailing plaintiff 
is entitled to recover costs.  Wisconsin Stat. § 814.04(2) 
authorizes 
imposition 
of 
costs 
for 
"all 
the 
necessary 
disbursements . . . allowed by law."  This includes "amounts 
actually paid out for certified copies of papers and records in 
any public office; 
postage, 
telegraphing, 
telephoning and 
express; depositions including copies . . . ."  Id. 
 
¶54 A circuit court may, in its discretion, determine that 
the requested item of cost was not a "necessary" disbursement, 
and deny a party costs on that basis.  See Aspen Servs., Inc. v. 
IT Corp., 220 Wis. 2d 491, 511, 583 N.W.2d 849 (Ct. App. 1998).  
We will uphold the circuit court's exercise of discretion, so 
long as it examined the relevant facts, applied a proper 
standard of law, and, using a demonstrated rational process, 
arrived at a conclusion that a reasonable judge could reach.  
Mgmt. Computer, 224 Wis. 2d at 330.   
 
¶55 In this case, the circuit court allowed as costs the 
expense of Havenick's videotape deposition, but denied DeWitt's 
request to tax as costs the stenographic deposition transcript.  
Because the record before us does not contain a transcript of 
the motion hearing on costs, we do not know the exact rational 
process demonstrated by the circuit court.  However, we surmise 
that it was persuaded by the Companies' argument that the text 
of Wis. Stat. § 885.42(1) precluded awarding the cost of 
obtaining a transcript of the deposition.  This argument misses 
the mark. 
No. 
02-0359   
 
24 
 
 
 
¶56 The difficulty with the Companies' argument was aptly 
recognized by the court of appeals.  It explained that, "Section 
885.42(1) provides that the party wanting a copy of the 
deposition must pay for it.  The statute does not address 
whether the deposition transcript or a copy of the videotape are 
taxable as costs."  DeWitt, 267 Wis. 2d 233, ¶53.  Accordingly, 
it looked to Wis. Stat. §§ 885.45 and 814.04(2) for guidance. 
 
¶57 Section 885.45(2) states that "the reasonable expense 
of recording testimony on videotape shall be costs in the 
action."  Subsections (3) and (6) allow the expenses associated 
with playing and editing the videotape, with the exception of a 
"videotape as a material," to be taxed as costs. Under 
subsection (4), the expense of an audio reproduction of the 
videotape sound track used by the court in ruling on objections 
shall be costs in the action. 
 
¶58 Although Wis. Stat. § 885.45 does not contain a 
specific provision about transcription, Wis. Stat. § 814.04(2) 
allows 
an 
award 
of 
costs 
to 
the 
prevailing 
party 
for 
"depositions including copies."  We agree with Dewitt that this 
case is not a situation where the transcripts were obtained 
solely for the convenience of counsel.  See J.F. Ahern Co. v. 
State Bldg. Comm'n, 114 Wis. 2d 69, 109-10, 336 N.W.2d 679 (Ct. 
App. 1983).  Rather, the deposition transcript was necessary for 
DeWitt's summary judgment motion because of the supporting 
papers 
requirement 
contained 
in 
Wis. 
Stat. 
§ 
802.08.15   
                                                 
15 Wisconsin Stat. § 802.08(3) provides, in relevant part:  
No. 
02-0359   
 
25 
 
 
Accordingly, we determine that the circuit court erroneously 
exercised its discretion in denying DeWitt the cost of the 
deposition transcript. 
VII 
¶59 In sum, we conclude that DeWitt did not make a valid 
Wis. Stat. § 807.01(3) offer of settlement.  We also conclude 
that the court of appeals properly determined that Southwest's 
guaranty on behalf of Galaxy Partnership included a guarantee to 
pay interest, that DeWitt could charge interest retroactive to 
January 1, 1997, and that DeWitt could recover as statutory 
costs the expenses of both its videographer and court reporter.  
Accordingly, we affirm in part and reverse in part the decision 
of the court of appeals, and remand the cause to the circuit 
court for entry of judgment consistent with this opinion. 
 
By the Court.—The decision of the court of appeals is 
affirmed in part and reversed in part and the cause is remanded 
to the circuit court for entry of judgment consistent with this 
opinion. 
 
                                                                                                                                                             
Supporting Papers.  Supporting and opposing affidavits 
shall be made on personal knowledge and shall set 
forth such evidentiary facts as would be admissible in 
evidence.  Copies of all papers or parts thereof 
referred to in an affidavit shall be attached thereto 
and served therewith, if not already of record.  The 
court may permit affidavits to be supplemented or 
opposed by depositions, answers to interrogatories, or 
further affidavits.  
 
No. 
02-0359   
 
26 
 
 
¶60 JON P. WILCOX, J. and DAVID T. PROSSER, J. did not 
participate.
No.  02-0359.ssa 
 
1 
 
 
¶61 SHIRLEY S. ABRAHAMSON, C.J.   (concurring in part, 
dissenting in part).  I agree with the majority on all issues 
(and join the majority opinion on all issues) except one.  I 
would hold, as did the circuit court, that DeWitt was not 
entitled 
to 
charge 
interest 
on 
Galaxy's 
unpaid 
bills 
retroactively to January 1, 1997.  I conclude that the retainer 
fee agreement permits DeWitt to charge interest only from 
November 27, 1997, the date that DeWitt notified Galaxy that it 
was exercising its contractual right to charge interest. 
¶62 The court of appeals wrote that "[i]t is undisputed 
that the terms of the retainer letter . . . specified that 
interest would accrue if payment was not received within twenty 
days of receipt [of the monthly statements]."16  But the meaning 
of the words of the retainer letter is very much in dispute.     
¶63 The retainer letter states, "We reserve the right to 
charge interest at the rate of 18% per annum (1½% per month) on 
all statements not paid within 20 days after their date" 
(emphasis added).  Instead of giving a specific date from which 
interest would begin accruing, the retainer letter merely 
empowers DeWitt to begin charging interest at some future date 
to be determined.  DeWitt sent monthly bills to Galaxy.  None of 
these monthly bills charged interest or stated that interest was 
or would be charged, although payments were in arrears.   
                                                 
16 DeWitt Ross & Stevens, S.C. v. Galaxy Gaming & Racing 
Ltd. P'ship, 2003 WI App 190, ¶48, 267 Wis.2d 233, 670 N.W.2d 
74. 
No.  02-0359.ssa 
 
2 
 
¶64 DeWitt announced to Galaxy its intention to charge 
interest in a letter dated November 24, 1997.  Interest would be 
charged if payment in full were not received by December 1, 
1997.  The client made partial payment, and DeWitt responded to 
the partial payment by a letter dated December 8, 1997, in which 
it demanded payment of interest; a schedule attached to the 
letter calculated interest retroactively from January 1, 1997.  
This attached schedule reflected DeWitt's decision to seek 
collection of interest retroactively from January 1, 1997, an 
arbitrarily selected date unrelated to the retainer or to 
dealings between lawyer and client.   
¶65 At oral argument, counsel for DeWitt explained that 
the provision in the retainer letter contract meant that 
interest would automatically accrue from the time payment was 
due, and that DeWitt reserved the right to waive that interest.  
But reserving the right to charge interest is not the same as 
reserving the right to waive interest that is automatically 
imposed.  If DeWitt wanted to reserve the right to waive 
interest that was automatically imposed, it should have stated 
so clearly in the retainer letter. 
¶66 At best the retainer letter is ambiguous about 
interest.  As a general rule, contractual ambiguities are 
construed against the drafter.17  This rule of interpretation is 
                                                 
17 Estreen v. Bluhm, 79 Wis. 2d 142, 155, 255 N.W.2d 473 
(1977) (citing Moran v. Shern, 60 Wis. 2d 39, 49, 208 N.W.2d 348 
(1973)).  See also Dieter v. Chrysler Corp., 2000 WI 45, ¶15, 
234 Wis. 2d 670, 610 N.W.2d 832. 
No.  02-0359.ssa 
 
3 
 
especially appropriate in an arrangement for legal fees because 
the rules of professional conduct place an affirmative duty on 
an attorney to communicate to the client the basis for any fees 
before or within a reasonable time after commencing the 
representation.18  The majority opinion, condoning DeWitt's 
demand for retroactive interest, is not in keeping with either 
the spirit or the letter of the rules designed to ensure clear 
                                                                                                                                                             
Based on this general rule, the Restatement (Third) of the 
Law Governing Lawyers states the rule of interpretation of 
attorney-client fee contracts as follows:  "[C]ontracts between 
clients and lawyers are to be construed from the standpoint of a 
reasonable person in the client's circumstances.  The lawyer 
thus bears the burden of ensuring that the contract states any 
terms diverging from a 
reasonable 
client's 
expectations."  
Restatement (Third) of the Law Governing Lawyers § 18 cmt. h, at 
159 (1998).  
See also Beatty v. NP Corp., 581 N.E.2d 1311, 1315 (Mass. 
App. Ct. 1991): 
As a general proposition, the meaning of a written 
document, if placed in doubt, is construed against the 
party that wrote it . . . and the principle surely 
counts double when the drafter is a lawyer writing on 
his or her own account to a client.  In setting fees, 
lawyers "are fiduciaries who owe their clients greater 
duties than are owed under the general law of 
contracts."  Restatement (Third) of the Law Governing 
Lawyers § 46, comment b (Tent. Draft No. 4, 1991).  
18 See SCR 20:1.5(b) ("When the lawyer has not regularly 
represented the client, the basis or rate of the fee shall be 
communicated to the client, preferably in writing, before or 
within a reasonable time after commencing the representation."). 
See ABA Standing Comm. on Ethics and Prof'l Responsibility, 
Formal Op. 93-379 (1993) ("At the outset of the representation 
the lawyer should make disclosure of the basis for the fee and 
any other charges to the client. . . . Initial disclosure of the 
basis for the fee arrangement fosters communication that will 
promote the attorney-client relationship."). 
No.  02-0359.ssa 
 
4 
 
communication between an attorney and client regarding the 
fees.19 
¶67 The majority opinion relies on Estreen v. Bluhm20 and 
other cases for the proposition that the interest due to DeWitt 
should run from the time the liquidated amount was due.21  
However, neither Estreen nor the other cases cited involve a 
contract that includes a "reserve the right to charge interest" 
provision or a dispute over attorney's fees.  Estreen and the 
other cases therefore add little, if anything, to the analysis 
of the retainer letter in the present case.  The majority 
opinion's application of the "general rule of Estreen"22 to this 
specialized 
contract 
provision 
and 
attorney-client 
fee 
agreements oversimplifies the matter at hand.  
¶68 In short, clients should pay their bills for legal 
services timely.  Attorneys should be able to collect their fees 
and interest (if interest is part of the agreement).  DeWitt 
reserved the right to charge interest and should be able to 
exercise that right, but not retroactively.  A client should get 
notice of the attorney's exercise of the contract right to 
charge interest; a client should not be placed at the mercy of 
                                                 
19 The issues of written fee agreements and settling fee 
disputes have been before the court in a rules petition and 
probably will come before the court again in the report of the 
Ethics 2000 Committee recommending changes in the rules.  
20 Estreen v. Bluhm, 79 Wis. 2d 142, 255 N.W.2d 473 (1977). 
21 Majority op., ¶¶50-51. 
22 Id., ¶51. 
No.  02-0359.ssa 
 
5 
 
an attorney's decision to seek interest retroactively with a 
date arbitrarily selected by the attorney.  
¶69 For the reasons set forth, I write separately on this 
issue. 
 
 
 
No.  02-0359.npc 
 
1 
 
 
¶70 N. 
PATRICK 
CROOKS, 
J.   (dissenting 
in 
part, 
concurring in part).  I disagree with the majority's conclusion 
that DeWitt did not make a valid settlement offer in this case.  
Majority op., ¶42.  Instead, I agree with the court of appeals 
that DeWitt's offer of settlement was valid and permissible 
under 
Wis. Stat. § 807.01(3). 
 
Nevertheless, 
I 
reach 
my 
conclusion based on the plain language of § 807.01(3) instead of 
the reasonableness test used by the court of appeals.  See 
DeWitt Ross & Stevens v. Galaxy Gaming, 2003 WI App 190, ¶¶31-
32, 267 Wis. 2d 233, 670 N.W.2d 74.  I also disagree with the 
majority of the court of appeals' analysis pertaining to 
interest.  Id., ¶¶55-65.  I would allow the recovery of interest 
in accord with Wis. Stat. § 807.01(4), in addition to contract 
interest.  Recognizing that the majority of this court does not 
address the interest issue, with respect to the remaining issues 
that it does address, however, I am in agreement. 
¶71 The majority contends that the proper approach to 
determining whether Wis. Stat. § 807.01 permits such conditions 
as the 15-day deadline for payment is to "look to the language 
of the statute to interpret and apply its express provisions."  
Majority op., ¶35.  Since nothing authorizes the placement of 
conditions on payment under § 807.01, the majority concludes 
that an offeror cannot impose conditions on payment.  Id., ¶36.  
The majority rejects the reasonableness standard utilized by the 
court of appeals, and, instead, rejects its own earlier test and 
concludes that the applicable test for whether a particular 
No.  02-0359.npc 
 
2 
 
condition may be included in a settlement offer is whether "the 
provision specifies a remedy that could be imposed by the 
court."  Id., ¶42.  Thus, because it concludes that a judge 
could not enter a judgment requiring the Companies to make 
payment in 15 days, the majority contends that DeWitt could not 
impose such condition itself.  Id. 
¶72 I agree with the court of appeals' approach to this 
issue 
with 
respect 
to 
its 
interpretation 
of 
Wis. Stat. § 807.01(3).  Section 807.01(3) provides no express 
prohibition against the inclusion of a payment deadline in an 
offer of settlement.  Section 807.01(3) simply provides that 
"the plaintiff may serve upon the defendant a written offer of 
settlement for the sum, or property, or to the effect therein 
specified, with costs."  There is no bar contained within the 
plain language of the statute itself that would render DeWitt's 
settlement offer invalid.   
¶73 Instead of the reasonableness test suggested by the 
court of appeals, I believe that the correct approach is to look 
to the plain language of Wis. Stat. § 807.01(3).  Section 
807.01(3) provides, in relevant part, that "[i]f the offer of 
settlement is not accepted and the plaintiff recovers a more 
favorable judgment, the plaintiff shall recover double the 
amount of the taxable costs."  Based on the statutory language, 
I disagree with the majority and conclude that conditions are 
not prohibited in offers of settlement.  When a condition is 
present in a settlement offer and a judgment is later obtained 
in the case, a court should review whether the judgment obtained 
No.  02-0359.npc 
 
3 
 
by a party is more favorable than the settlement offer including 
conditions, if any, therein.  By applying the statutory 
language, I conclude that DeWitt made a valid settlement offer, 
since the judgment obtained was for more money and, therefore, 
was more favorable.  It is possible that attaching certain types 
of conditions to a statutory settlement offer may result in a 
conclusion by a court that the judgment obtained is not in fact 
"more favorable" than the settlement offer for purposes of the 
statute.  However, the 15-day condition on payment contained in 
the statutory settlement offer in this case does not render the 
settlement offer invalid under the statute; nor does it preclude 
a conclusion that the judgment obtained was more favorable than 
the settlement offer for purposes of § 807.01 (3) and (4). 
¶74 Although I agree with the majority of the court of 
appeals' conclusion regarding the validity of the settlement 
offer, I strongly disagree with its conclusion regarding 
interest.  The court of appeals stated that it was bound by its 
decisions in Upthegrove v. Lumbermans Ins. Co., 152 Wis. 2d 7, 
447 N.W.2d 367 (Ct. App. 1989) and Erickson v. Gundersen, 183 
Wis. 2d 106, 515 N.W.2d 293 (Ct. App. 1994) and, thus, concluded 
that the analyses set forth in those cases controlled the 
outcome here.  DeWitt, 267 Wis. 2d 233, ¶62.  Yet, as Judge 
Dykman points out in his dissent, those cases do not involve the 
issue presented here, namely whether allowing interest in accord 
with Wis. Stat. § 807.01(4) in addition to contract interest is 
permissible.  Id., ¶74.   
No.  02-0359.npc 
 
4 
 
¶75 Erickson was a case involving the issue of whether a 
litigant was entitled to both common law prejudgment interest 
and interest under Wis. Stat. § 807.01(4).  The question of 
contract interest in addition to § 807.01(4) interest was not 
discussed at all in Erickson, so that case is not helpful here.  
Upthegrove 
involved 
the 
issue 
of 
whether 
interest 
from 
§ 807.01(4) and Wis. Stat. § 628.46 could be stacked one on top 
of the other.  Upthegrove, 152 Wis. 2d 7 at 12-13.  Whether two 
distinct statutory provisions regarding interest may be utilized 
presents an entirely different question than whether § 807.01(4) 
interest may be recovered along with contract interest.  Those 
cases do not provide any guidance for the resolution of the 
issue presented here.   
¶76 Most 
convincingly, 
the 
plain 
language 
of 
Wis. Stat. § 807.01(4) allows for the recovery of such interest, 
without any limitation concerning contract interest.  Section 
807.01(4) states, in relevant part: 
If there is an offer of settlement by a party under 
this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at the annual rate of 
12% on the amount recovered from the date of the offer 
of settlement until the amount is paid.   
¶77 I, like Judge Dykman in his dissent, am not persuaded 
that silence in a statute means that a party is barred from 
recovering 
Wis. Stat. § 807.01(4) 
interest 
in 
addition 
to 
contract 
interest. 
 
Such 
an 
approach——silence 
equals 
prohibition——appears illogical and contrary to the language of 
the statute. 
No.  02-0359.npc 
 
5 
 
¶78 Although I am in disagreement regarding the issue 
concerning a valid offer, I agree with the majority of this 
court on the remainder of the issues it discusses.  More 
specifically, I agree that Southwest's guaranty to make "timely 
and full payment of all statements for services rendered and 
disbursements/expenses incurred on behalf of the Partnership" 
bound it to pay accrued interest as well.  Majority op., ¶43.  I 
also agree that DeWitt could charge the Companies interest 
retroactive to January 1, 1997, since the retainer letter's 
terms provided that interest would accrue if payment was not 
made within 20 days of receipt of the monthly statement.  Id., 
¶51.  Finally, I agree that DeWitt could recover the costs of 
both a videographer and a court reporter taking the same 
deposition, pursuant to Wis. Stat. § 814.04(2).  Id., ¶58.  
¶79 In summary, I conclude that DeWitt made a valid 
settlement offer to the Companies.  I further conclude that 
DeWitt 
was 
entitled 
to 
recover 
interest 
under 
Wis. Stat. § 807.01(4) in addition to the interest provided for 
in its contract with the Companies.  I do agree, however, with 
the majority on the remainder of the issues it discusses. 
¶80 For the foregoing reasons, I respectfully dissent in 
part and concur in part. 
¶81 I am authorized to state that Justice DIANE S. SYKES 
joins this dissent/concurrence. 
 
 
No.  02-0359.npc 
 
 
 
1