Title: Community Credit Plan, Inc. v. Frank M. Kett
Citation: N/A
Docket Number: 1997AP000575
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: July 9, 1999

SUPREME COURT OF WISCONSIN 
 
 
Case No.: 
97-0574, 97-0575, 97-0576, 97-0577 
 
97-0735, 97-1101, 97-1102 
 
 
Complete Title 
of Case: 
 
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Marcia K. Johnson and Hulda Johnson,  
 
Defendants-Appellants.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Frank M. Kett,  
 
Defendant-Appellant.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Frank M. Kett,  
 
Defendant-Appellant.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Kenneth P. Mader,  
 
Defendant-Appellant.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Roger H. Schuett,  
 
Defendant-Appellant.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Willie Quattlebaum and Dorothy Quattlebaum,  
 
Defendants-Appellants.  
 
Community Credit Plan, Inc.,  
 
Plaintiff-Respondent-Petitioner, 
 
v. 
Willie Quattlebaum and Dorothy Quattlebaum,  
 
Defendants-Appellants.  
 
 
 
 
ON REVIEW OF A DECISION OF THE COURT OF APPEALS 
Reported at:  221 Wis. 2d 766, 586 N.W.2d 77 
 
 
(Ct. App. 1998-Published) 
 
 
Opinion Filed: 
July 9, 1999 
Submitted on Briefs: 
 
Oral Argument: 
June 2, 1999 
 
 
Source of APPEAL 
 
COURT: 
Circuit 
 
COUNTY: 
Milwaukee 
 
JUDGE: 
Michael G. Malmstadt/Frank T. Crivello 
 
 
JUSTICES: 
 
Concurred: 
 
 
Dissented: 
Wilcox, J., dissents (opinion filed) 
 
Not Participating:  
 
 
ATTORNEYS: 
For the plaintiff-respondent-petitioner there 
were briefs by Arthur M. Moglowsky, Penny G. Gentges and Bass & 
Moglowsky, S.C., Milwaukee and oral argument by Arthur M. 
Moglowsky. 
 
 
For all the defendants-appellants there was a 
brief by Gerald R. Harmon and Harmon Law Office, Milwaukee and 
oral argument by Gerald R. Harmon. 
 
 
Amicus curiae was filed by Stephen E. Meili and 
Consumer Law Litigation Clinic, Madison for Center for Public 
Representation, Inc. 
 
 
Amicus curiae was filed by Edward J. Heiser, Jr., 
and Whyte Hirschboeck Dudek, S.C., Milwaukee for the Wisconsin 
Financial Services Association. 
 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
1 
 
NOTICE 
This opinion is subject to further editing and 
modification.  The final version will appear in 
the bound volume of the official reports. 
 
 
Nos. 
97-0574-77, 97-0735 & 97-1101-02 
 
STATE OF WISCONSIN               :        
        
 
 
 
 
IN SUPREME COURT 
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Marcia K. Johnson and Hulda Johnson,  
 
          Defendants-Appellants.  
FILED 
 
JUL 9, 1999 
 
Marilyn L. Graves 
Clerk of Supreme Court 
Madison, WI 
 
 
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Frank M. Kett,  
 
          Defendant-Appellant.  
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Frank M. Kett,  
 
          Defendant-Appellant.  
 
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Kenneth P. Mader,  
 
          Defendant-Appellant.  
 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
2 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Roger H. Schuett,  
 
          Defendant-Appellant.  
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Willie Quattlebaum and Dorothy  
Quattlebaum,  
 
          Defendants-Appellants.  
 
 
Community Credit Plan, Inc.,  
 
          Plaintiff-Respondent-Petitioner, 
 
     v. 
 
Willie Quattlebaum and Dorothy  
Quattlebaum,  
 
          Defendants-Appellants.  
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed. 
¶1 
DONALD W. STEINMETZ, J.   The petitioner, Community 
Credit Plan, Inc. (Community), seeks review of the court of 
appeals' decision, Community Credit Plan, Inc. v. Johnson, 221 
Wis. 2d 766, 586 N.W.2d 77 (Ct. App. 1998), awarding attorney 
fees pursuant to the Wisconsin Consumer Act (WCA) to defendants-
appellants.  The appellate court's decision reversed the orders 
of the Milwaukee County Circuit Court, Honorable Michael 
Malmstadt and Honorable Frank T. Crivello, in the consolidated 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
3 
replevin actions.  In each case, the circuit court determined 
that the defendants-appellants (customers) did not "prevail" 
under Wis. Stat. § 425.308 and were thus not entitled to their 
attorney fees.12   
¶2 
A 
majority 
of 
the 
court 
of 
appeals 
reversed, 
concluding that because the customers, in a consumer credit 
transaction, had succeeded in their motions to vacate the 
default judgments which had been entered against them, they were 
the prevailing parties under Wis. Stat. § 425.308.    This case 
is a consumer credit transaction case to which Wis. Stat. § 
421.401(2)(b) applies. 
¶3 
The customers all purchased vehicles in consumer 
credit transactions financed by Community, whose office is in 
Waukesha County.  The transactions did not occur in Milwaukee 
County, nor did any of the customers live or store any vehicle 
involved in a transaction in Milwaukee County.  When each of 
these loans went into default, Community commenced small claims 
replevin actions in Milwaukee County against each customer to 
recover the vehicles which had secured the consumer credit 
transactions.  None of the customers appeared in court, and 
default judgments in replevin authorizing repossession were 
entered against each customer by the Milwaukee County small 
                     
1 The Wisconsin Consumer Act consists of Wis. Stat. chs. 
421-27.   
2 Unless otherwise noted, all statutory cites are to the 
1995-96 version.   
  
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
4 
claims court.  All but one of the vehicles subject to orders 
were repossessed.   
¶4 
After the repossession and sale of the vehicles had 
occurred (except in the Quattlebaum cases) each customer brought 
a motion to vacate the respective judgment and to dismiss the 
action, 
under 
Wis. 
Stat. 
§ 
421.401(2)(b), 
for 
lack 
of 
jurisdiction on the grounds of improper venue.  The motions did 
not include answers to the small claims replevin actions, and 
the customers have not made any assertions regarding the 
underlying basis for the repossession actions.   
¶5 
In five of the cases, Community did not oppose the 
motions to vacate the judgments (Community objected to the 
Quattlebaum's motion because of an intervening bankruptcy).  The 
circuit court granted each of the customer's motions to vacate 
the judgments.  The circuit court then granted Community's oral 
motions to dismiss the actions without prejudice.  The circuit 
court also determined that the customers were not entitled to 
fees pursuant to Wis. Stat. § 425.308.  The court stated, 
"[t]his is not the kind of mistake [] or practice that I believe 
the Wisconsin Consumer Act was designed and intended to protect 
consumers from.  This was merely a legal error made by a 
nonlegal, nonlegally trained agent of a company which does 
routine business perhaps in small claims court."  The judge also 
concluded, "I just do not believe under the reasoning stated in 
the Footville [State Bank v. Harvell, 146 Wis. 2d 524, 432 
N.W.2d 122 (Ct. App. 1988)] decision that the defendants have 
prevailed on a significant issue in this litigation."   
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
5 
¶6 
In each of the seven cases, the circuit court did, 
however, award $250 in fees under Wis. Stat. § 805.04(2), which 
allows the court to set "such terms and conditions as the court 
deems proper" in granting a voluntary dismissal.   
¶7 
The customers appealed the denial of attorney fees 
under the WCA.  A majority of the court of appeals reversed, 
concluding that the customers did prevail in circuit court, and 
were therefore entitled to attorney fees under the WCA. 
¶8 
The court used a two-prong test to reach this 
conclusion: whether there was a significant benefit in the 
litigation to the plaintiff, and whether there was a violation 
of the WCA by the defendant.  Because the customers received a 
"significant 
benefit" 
from 
the 
dismissal 
of 
the 
default 
judgments, and because the creditor had in fact violated the WCA 
by prosecuting the action in Milwaukee County in violation of 
the venue provisions of the WCA, Wis. Stat. § 421.401(1) and 
(2)(b), the court held that the customers prevailed.   
¶9 
The court of appeals rejected Community's claim that 
the customers did not prevail because their motions to dismiss 
were not granted.  Instead, the court concluded that Community's 
motions to voluntarily dismiss achieved the very same result; 
therefore, the customers were the prevailing party for fee-
shifting purposes.  In reaching this conclusion, the court 
looked to the "catalyst test" which was developed to determine 
whether to award attorney fees under the fee shifting provision 
of 42 U.S.C. § 1988.  The two-part catalyst test requires that a 
causal link between the lawsuit and the relief obtained be 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
6 
established, and that the opponent's conduct was required by 
law.  The catalyst test differs from the "substantial benefit" 
test in that neither a "substantial benefit" nor a violation of 
the WCA by the creditor need be shown.   
¶10 The issue to be determined is if, under Wis. Stat. 
§ 421.401(1) and (2)(b), the customers prevailed under the 
statute and are therefore entitled to an award of attorney fees 
pursuant to the WCA.  The majority of this court affirms and 
adopts the reasoning and decision of the majority of the court 
of appeals in this case.  Community Credit Plan, Inc. v. 
Johnson, 221 Wis. 2d 766, 586 N.W.2d 77 (Ct. App. 1998). 
¶11 We disagree with the view held by Judge Curley in her 
dissent that Community did not violate the WCA because it is the 
circuit court's duty to screen out improperly venued actions.  
See Community Credit Plan, 221 Wis. 2d at 780 (Curley, J., 
dissenting).  While the circuit court is to dismiss an 
improperly venued action for lack of jurisdiction, see Wis. 
Stat. § 421.401(2) and (b), the venue provision of the WCA 
clearly defines for creditors the proper venue for actions 
arising from consumer credit transactions.  See Community Credit 
Plan, 221 Wis. 2d at 774; Wis. Stat. § 421.401(1).  Where a 
creditor in a consumer credit transaction fails to prosecute an 
action in the proper venue, the creditor prosecutes contrary to 
the venue provisions, and is in violation of those provisions.  
Wis. Stat. § 421.401(2)(b).  To hold otherwise would fail one of 
the purposes behind the WCA, which is to "protect customers 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
7 
against unfair, deceptive, false, misleading and unconscionable 
practices by merchants."  Wis. Stat. § 421.102(2)(b). 
¶12 We also disagree with the argument made by the 
Wisconsin Financial Services Association (Association) in its 
amicus curiae brief to this court.  Upon setting forth the 
multiple purposes of the Wisconsin Consumer Act, see Wis. Stat. 
§ 421.102(2)(a)-(c), the Association contends that an award of 
attorney fees is not in accord with those purposes for it 
neither serves to deter violations of the venue provisions nor 
is consistent with the "severity" of a violation of those 
provisions.  Contrary to its position, a violation of the venue 
provision in a consumer credit transaction is serious, as the 
default judgments and subsequent repossessions involved in these 
cases amply demonstrate. 
¶13 In reaching its conclusion, the Association failed to 
address a fourth purpose of the Wisconsin Consumer Act, which is 
the 
coordination 
of 
the 
regulation 
of 
consumer 
credit 
transactions [in Wisconsin] with the policies of the federal 
consumer credit act.  Wis. Stat. § 421.102(2)(d).  The federal 
consumer credit act was designed to counter a broad variety of 
abuses, 
including 
the 
prosecution 
in 
venues 
far 
from 
a 
customer's residence.  Blakemore v. Pekay, 895 F. Supp. 972, 978 
(N.D. Ill. 1995) ("The venue provision of the FDCPA was designed 
to limit the ability of debt collectors to file debt collection 
actions in courts inconvenient to the debtor.").  Likewise, the 
Wisconsin Consumer Act protects customers from the serious 
Nos. 97-0574-77, 97-0735 & 97-1101-02 
 
8 
problems and inconveniences accompanying actions prosecuted in 
an improper venue, as these actions were. 
¶14 For the reasons set forth in Community Credit Plan, 
221 Wis. 2d 766, we hold that the customers were prevailing 
parties under Wis. Stat. § 425.308.  The customers received a 
significant benefit in the opening and dismissal of the default 
judgments 
against 
them 
in 
accordance 
with 
Wis. 
Stat. 
§ 
421.401(2)(b), and Community's prosecution of the seven actions 
in the Milwaukee County Circuit Court was a violation of Wis. 
Stat. § 421.401(2)(b), the WCA venue provision. 
By the Court.—The decision of the court of appeals is 
affirmed.   
 
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
1 
 
¶15 JON 
P. 
WILCOX, 
J. 
(Dissenting).   The 
Wisconsin 
Consumer Act (WCA) was enacted to more equally balance consumer-
creditor interests in consumer transactions.3  The purposes of 
the WCA, set forth in Wis. Stat. § 421.102(2), are:  “To 
simplify, clarify and modernize the law governing consumer 
transactions”; “To protect customers against unfair, deceptive, 
false, misleading and unconscionable practices by merchants”; 
and “To permit and encourage the development of fair and 
economically sound consumer practices in consumer transactions.” 
 § 421.102(2)(a)-(c).  While the WCA is to be liberally 
construed to promote its underlying purposes and policies, the 
majority’s opinion today has tipped the balance.  Therefore, I 
respectfully dissent. 
¶16 “The basic purpose of the remedies set forth in 
Chapter 425, Stats., is to induce compliance with the WCA and 
thereby promote its underlying objects.”  First Wisconsin Nat’l 
Bank v. Nicolaou, 113 Wis. 2d 524, 533, 335 N.W.2d 390 (1983).  
One such remedy is the fee-shifting statute, Wis. Stat. 
§ 425.308.  Section 425.308 provides in part: 
Reasonable attorney fees.  (1)  If the customer 
prevails 
in 
an 
action 
arising 
from 
a 
consumer 
transaction, the customer shall recover the aggregate 
amount of costs and expenses . . . together with a 
reasonable amount for attorney fees. 
                     
3 Jeffrey Davis, Legislative Restriction of Creditor Powers 
and Remedies:  A Case Study of the Negotiation and Drafting of 
the Wisconsin Consumer Act, 72 Mich. L. Rev. 3, 6 (1973).   
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
2 
¶17 The issue in this case is whether the seven customers 
prevailed under the WCA, and are therefore entitled to recover 
the attorney’s fees and expenses incurred in bringing their 
motions to reopen.  In order to prevail under Wis. Stat. 
§ 425.308, the customer (1) must be the “prevailing party,” 
i.e., he or she must have succeeded on a significant issue in 
litigation, and (2) the benefit must involve the creditor’s 
violation of the WCA.  Footville State Bank v. Harvell, 146 Wis. 
2d 524, 530, 539-40, 432 N.W.2d 122 (Ct. App. 1988).   
¶18 I agree with the dissent in the court of appeals in 
this case that the reopening and dismissal without prejudice of 
these matters do not constitute a “significant benefit” to the 
customers.  “[T]he reopening of the matters and their dismissal 
merely required the creditors to recommence these actions in the 
proper county.  At best, any negative effects which were halted 
were halted temporarily.”  Community Credit Plan, Inc. v. 
Johnson, 221 Wis. 2d 766, 777-78, 586 N.W.2d 77 (Ct. App. 
1998)(Curley, J., dissenting).  Thus, I would hold that the 
customers did not achieve a significant benefit in this 
litigation.4  See id. at 774. 
                     
4 I also believe that the court of appeals, and consequently 
the majority in this case, incorrectly relied on facts not 
supported by the record.  The record does not contain the 
customers credit records (which could have been marred) nor 
would the replevin judgments allow for the garnishment of the 
customers’ wages, only possession of the property.  Wis. Stat. 
§ 425.205(1)(e).   
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
3 
¶19 I also disagree with the application of the catalyst 
test, the test for determining prevailing party status for 
attorney’s fees under 42 U.S.C. § 1988, to actions which fall 
under the WCA.  See Community Credit Plan, 221 Wis. 2d at 775-
76.  This court has never sanctioned the application of the 
catalyst test to a fee request under the WCA,5 and has not 
adequately explained its reasons for doing so now.  I believe 
the majority, by sanctioning use of the catalyst test under the 
WCA, has unnecessarily and incorrectly extended the right of a 
customer to receive attorney’s fees for virtually any outcome 
which “favors” the customer—not just mistakes in venue.   
¶20 An award of attorney’s fees under Wis. Stat. § 425.308 
is further limited to those cases in which the creditor violated 
a provision in the WCA.  River Bank of DeSoto v. Fisher, 206 
Wis. 2d 63, 66-67, 556 N.W.2d 324 (1996); Nicolaou, 113 Wis. 2d 
at 536.  The creditor bears the responsibility to avoid mistakes 
of law and resulting WCA violations.  Nicolaou, 113 Wis. 2d at 
534.   
¶21 The 
majority 
has 
held 
that 
“[t]he 
Creditor’s 
prosecution of these seven actions in the Milwaukee County 
Circuit Court was a violation of the venue provision of the 
WCA.”  Community Credit Plan, 221 Wis. 2d at 775 (emphasis 
                     
5 My research has not revealed any federal authority 
applying the catalyst test to actions brought under the federal 
consumer credit protection act, which provides a basis for 
interpreting the WCA.  See Wis. Stat. § 421.102(2)(d).   
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
4 
added).  Venue for a claim arising out of a consumer credit 
transaction is the county:  
(a)  Where the customer resides or is personally 
served; 
(b)  Where the collateral securing a consumer credit 
transaction is located; or 
(c)  Where the customer sought or acquired the 
property, services, money or credit which is the 
subject of the transaction or signed the document 
evidencing his or her obligation under the terms of 
the transaction. 
Wis. Stat. § 421.401(1).  Section 421.401(2) provides:   
(2)  When it appears from the return of service of the 
summons or otherwise that the county in which the 
action is pending under sub. (1) is not a proper place 
of trial for such action, unless the defendant appears 
and waives the improper venue, the court shall act as 
follows: 
(a)  Except as provided  in par. (b), if it appears 
that another county would be a proper place of trial, 
the court shall transfer the action to that county. 
(b)  If the action arises out of a consumer credit 
transaction, the court shall dismiss the action for 
lack of jurisdiction.  [Emphasis added.] 
¶22 I am persuaded by the dissent’s position that the 
legislative scheme requires affirmative action by the court on 
venue issues.  Johnson, 221 Wis. 2d 766, 779 (Curley, J. 
dissenting).  The language of the statute supports this 
conclusion. 
¶23 First, the use of the word “shall” indicates that the 
court’s action to determine venue and either transfer the case 
or dismiss the case, if necessary, is mandatory.  Nicolaou, 113 
Wis. 2d at 536; Wis. Stat. § 421.401(2)(a) and (b).  “Had the 
trial court followed the legislative scheme, it [w]ould have 
dismissed these actions rather than granting default judgments. 
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
5 
 It is the trial court, not the creditors, who are charged with 
reviewing the case for improper venue.”  Community Credit Plan, 
221 Wis. 2d at 779 (Curley, J., dissenting). To place the burden 
of determining proper venue solely on the creditor without 
acknowledging any court responsibility renders this language 
directing the court to act superfluous.  We do not construe 
statutes so as to render a word or clause superfluous.  
Footville State Bank, 146 Wis. 2d at 536.    
¶24 Second, the statement “when it appears from the return 
of service”6 that the county is not the proper place for trial 
suggests to me that at some point after the summons and 
complaint have been filed, the case will be reviewed for a 
determination of venue.  In contrast, the majority concludes 
that the prosecution or commencement of the action in the wrong 
county, irrespective of judicial review, constitutes a violation 
of the WCA.  The creditor loses before he or she has even 
started. 
¶25 Moreover, the majority’s decision is far too broad—the 
prosecution of a case in the wrong county constitutes a 
violation of Wis. Stat. § 421.401.  Community Credit Plan, 221 
                     
6 “Written proof of service is required to the end that 
jurisdiction appear of record.  This may be supplied by written 
admission of the defendant, by certificate of the sheriff or 
deputy if that officer makes the service, otherwise by affidavit 
of any other person making the service.  But it is the fact of 
service, not its proof, which gives the court jurisdiction.”  2 
CALLAGHAN’S WIS. PL & PR § 14.44 (4th ed. 1996).  A defective return 
may be amended even after judgment to supply omissions.  Id. at 
§§ 14.44 and 14.70. 
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
6 
Wis. 2d at 775.  Under this holding, attorney’s fees can be 
assessed in a consumer transaction under § 421.401(2)(a)(where 
the defect is remedied by transferring to the proper county) as 
well as consumer credit transactions under § 421.401(2)(b)(where 
the case must be dismissed). The ultimate remedy does not 
determine 
a 
violation; 
according 
to 
the 
majority, 
the 
commencement of an action in the wrong county constitutes a 
violation of the venue provision. 
¶26 “Given the fluid nature of the statute, a county which 
was an appropriate county when the action was commenced may 
become inappropriate by the time of service. . . . Further, a 
high percentage of these small claims actions are brought and 
litigated by non-lawyers who often are unable to easily 
determine what constitutes proper venue.”  Community Credit 
Plan, 221 Wis. 2d at 778-79 (Curley, J., dissenting).  I believe 
the 
majority 
has 
unfairly 
created 
a 
trap 
in 
which 
unsophisticated creditors may easily step.  Consumer credit 
transactions are not every creditors’ “bread and butter.”   
¶27 Admittedly, the WCA was enacted, in part, to protect 
customers “against unfair, deceptive, false, misleading and 
unconscionable 
practices 
by 
merchants.” 
 
Wis. 
Stat. 
§ 421.102(2)(b).  However, there has been no finding by the 
circuit court that Community Credit’s action was unconscionable, 
unfair, deceptive or misleading.  Without evidence to support a 
finding of unfair practices by a creditor, I do not believe a 
mistake in venue should constitute a violation of the WCA.  Nor 
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw 
 
7 
does an award of attorney’s fees without evidence of abuse by a 
creditor further the purposes of the WCA.   
¶28 It is undisputed that the customers defaulted on their 
payments.  In their motions to reopen, the customers did not 
even raise a defense to the claim of default.  It would seem 
that the venue question is being pursued to simply collect 
attorney’s fees, not defend the customers’ defaults.  The 
majority not only sanctions such suits, its decision encourages 
them.   
¶29 For the above-stated reasons, I respectfully dissent.  
 
Nos. 97-0574-77, 97-0735 & 97-1101-02.jpw