Title: Justin L. Ruckel v. Troy W. Gassner
Citation: 2002 WI 67
Docket Number: 2000AP002036
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: June 21, 2002

2002 WI 67 
 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
00-2036 
COMPLETE TITLE: 
 
 
Justin L. Ruckel,  
 
Plaintiff-Respondent, 
 
v. 
Troy W. Gassner,  
 
Defendant-(In T.ct.), 
HUMANA, Inc.,  
 
Defendant-Appellant. 
 
 
 
 
ON CERTIFICATION FROM THE COURT OF APPEALS 
 
 
OPINION FILED: 
June 21, 2002   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
November 5, 2001   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Dodge   
 
JUDGE: 
Andrew P. Bissonnette   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the defendant-appellant there were briefs (in the court 
of appeals and the supreme court) by Ward I. Richter, Johnathan 
T. McCaskill, Sheila M. Sullivan and Bell, Gierhart & Moore, 
S.C., Madison, and oral argument by Sheila M. Sullivan. 
 
For the plaintiff-respondent there was a brief (in the 
court of appeals) by Robert E. Storck and Storck, Schnabl & 
Madden, Mayville, and oral argument by Patrick O. Dunphy. 
 
An amicus curiae brief was filed by Edward E. Robinson and 
Cannon & Dunphy, S.C., Brookfield, and Brian H. Sande and Doar, 
Drill & Skow, S.C., Baldwin, on behalf of the Wisconsin Academy 
of Trial Lawyers, and there was oral argument by Patrick O. 
Dunphy. 
 
 
2002 WI 67 
NOTICE 
This opinion is subject to further 
editing and modification.  The 
final version will appear in the 
bound 
volume 
of 
the 
official 
reports.   
No.  00-2036   
(L.C. No. 
99 CV 342) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Justin L. Ruckel,  
 
          Plaintiff-Respondent, 
 
     v. 
 
Troy W. Gassner,  
 
          Defendant-(In T.ct.), 
 
HUMANA, Inc.,  
 
          Defendant-Appellant. 
 
FILED 
 
JUN 21, 2002 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
APPEAL from a judgment of the Circuit Court for Dodge 
County, Andrew P. Bissonnette, Judge.   Affirmed.   
 
¶1 
DAVID T. PROSSER, J.   This case is before the court 
on 
certification 
by 
the 
court 
of 
appeals 
pursuant 
to 
Wis. Stat. § (Rule) 809.61 (1999-2000).1  It is an appeal of a 
judgment of the Circuit Court for Dodge County.  Circuit Judge 
Andrew P. Bissonnette applied the "made whole" doctrine to a 
self-funded group insurance benefit plan to preclude the plan 
                                                 
1 All references to the Wisconsin Statutes are to the 1999-
2000 version unless otherwise noted. 
No. 00-2036 
 
2 
 
from recovering money paid by a tortfeasor to the plan's insured 
before the insured was fully compensated for his damages. 
¶2 
The issue framed by the court of appeals is whether 
the parties to an insurance contract may override the made whole 
doctrine by expressly stating in the insurance contract the 
intention to do so.  Specifically, may the parties to an 
insurance contract override or negate the made whole doctrine by 
writing specific, unambiguous contractual language stating that 
the insurer's rights to subrogation are superior to the 
insured's right to be made whole? 
¶3 
We accepted certification to clarify any perceived 
inconsistency between our decisions in Garrity v. Rural Mut. 
Ins. Co., 77 Wis. 2d 537, 546-47, 253 N.W.2d 512 (1977), in 
which we held that the made whole doctrine applied because the 
insurance contract contained no language to the contrary, and 
Rimes v. State Farm Mut. Auto. Ins. Co., 106 Wis. 2d 263, 272, 
316 N.W.2d 348 (1982), in which we concluded that, under 
Wisconsin law, one who claims subrogation rights is barred from 
any recovery unless the insured is made whole. 
¶4 
The circuit court in this case rejected the insurer's 
position that it had a contractual right to recover medical 
expenses it paid to its insured even though the insured was not 
made whole.  The court followed the Garrity and Rimes cases, 
determining that a subrogation clause in an insurance contract 
may not override the made whole doctrine no matter how clearly 
and explicitly the clause states the parties' intention to do 
so.  We agree with the circuit court and hold that an insured 
No. 00-2036 
 
3 
 
must be made whole before the insurer may exercise subrogation 
rights against its insured, even when unambiguous language in an 
insurance contract states otherwise.2  Consequently, we affirm. 
FACTUAL BACKGROUND 
¶5 
On February 20, 1999, Justin Ruckel, then 18 and still 
in high school, was shot in the knee while visiting the 
apartment of Troy Gassner.  The accident occurred when Gassner 
recklessly mishandled a .44 caliber handgun causing it to 
discharge.  Ruckel's injury required multiple surgeries and led 
to significant permanent disability.  Gassner was subsequently 
convicted of violating Wis. Stat. § 941.30(1), for recklessly 
endangering another's safety under circumstances showing utter 
disregard for human life. 
¶6 
Gassner had no liability insurance.  However, Ruckel 
was covered under his mother's insurance with the Mayville 
School District (District), her employer.  The District has a 
self-funded group insurance benefit program, administered by 
Humana/Employers Health Insurance Company (Humana).  The program 
or plan includes health insurance. 
¶7 
Six months after the accident, Ruckel brought suit 
against Gassner for negligent and intentional torts.  He sought 
compensatory damages for pain and suffering, past and future 
medical expenses, loss of income, and permanent injury, as well 
                                                 
2 This holding is not applicable to a situation in which 
Congress or the state legislature has statutorily determined 
subrogation rights in a way that negates the made whole 
doctrine.  See ¶42 n.7, infra. 
No. 00-2036 
 
4 
 
as punitive damages, costs, and disbursements.  The suit also 
named Humana as a defendant because of its possible subrogation 
interests.  By the time the circuit court heard the case, Humana 
had paid out $86,626.01 for Ruckel's medical expenses. 
¶8 
Gassner did not file an answer.  Humana did file an 
answer and a cross-claim seeking to recoup all its expenditures 
on behalf of Ruckel. 
¶9 
Humana subsequently moved for a declaratory judgment, 
asserting that the made whole doctrine did not apply and that 
Humana's "contractual right to repayment takes priority over" 
Ruckel's recovery rights.  Humana claimed that it was entitled 
to recover the $86,626.01 in medical expenses it paid on behalf 
of Ruckel, before Ruckel received any money from Gassner.  
Humana relied on language in the subrogation clause of the 
insurance contract.  The clause stated in part: "The Plan shall 
be repaid the full amount of the covered expenses it pays" and 
"[Humana's] right to repayment is, and shall be, prior and 
superior to the right of any other person or entity including 
the beneficiary" (emphasis omitted). 
¶10 The circuit court held a hearing on April 24, 2000, to 
decide the priority of any proceeds between Ruckel and Humana 
and to determine the cause of Ruckel's injury, including his own 
negligence, if any, and the amount of his damages.  At the 
hearing, the court determined that pursuant to Garrity and 
Rimes, the subrogation clause in Humana's insurance contract is 
not applicable until the insured is made whole. 
No. 00-2036 
 
5 
 
¶11 On May 8, 2000, the circuit court entered default 
judgment 
against Gassner, 
finding 
that 
Gassner's reckless 
conduct was "the sole cause of the injuries" suffered by Ruckel.3  
The court calculated that Ruckel's damages totaled $459,831.26 
and that Ruckel was entitled to damages of $373,205.25 from 
Gassner.  The court further stated that "following payment of 
said $373,205.25, any payments made after that shall accrue to 
be paid toward the judgment [granted to] Humana, Inc. in the 
amount of $86,626.01." 
¶12 Humana appealed, and this court accepted certification 
by the court of appeals. 
ANALYSIS 
¶13 The issue in this case is whether the made whole 
doctrine applies when an insurance contract unambiguously states 
that the insurer's subrogation rights are superior to the 
insured's right to be made whole.  The application of the made 
whole doctrine to undisputed facts is a question of law which we 
review de novo.  Oakley v. Wis. Fireman's Fund, 162 Wis. 2d 821, 
826, 470 N.W.2d 882 (1991).  
¶14 Black's Law Dictionary defines "subrogation" as: "The 
substitution of one party for another whose debt the party pays, 
entitling the paying party to rights, remedies, or securities 
that would otherwise belong to the debtor."  Black's Law 
Dictionary 1440 (7th ed. 1999).  This substitution of one party 
                                                 
3 The determination that Gassner's reckless conduct was 
solely 
responsible 
for 
Ruckel's 
injuries 
removes 
any 
consideration of contributory negligence in this case. 
No. 00-2036 
 
6 
 
for another rests upon the equitable principle that one (other 
than a volunteer) who pays for the wrong of another should be 
permitted to look to the wrongdoer to the extent he has paid, 
and be subject to the defenses of the wrongdoer.  Garrity, 77 
Wis. 2d at 541 (citing Employers Ins. of Wausau v. Sheedy, 42 
Wis. 2d 161, 170, 166 N.W.2d 220 (1969); Interstate Fire & Cas. 
Co. v. City of Milwaukee, 45 Wis. 2d 331, 334, 173 N.W.2d 187 
(1970)).4 
¶15 Subrogation also rests upon the equitable principle 
that a creditor or an insured is not entitled to double 
recovery.  Rimes, 106 Wis. 2d at 272.  Hence, the law invokes 
subrogation to avoid unjust enrichment.  New Amsterdam Cas. Co. 
v. Acorn Prods. Co., 42 Wis. 2d 127, 132, 166 N.W.2d 198 (1969) 
(quoting Perkins v. Worzala, 31 Wis. 2d 634, 637, 143 N.W.2d 516 
(1966)); Kennedy-Ingalls Corp. v. Meissner, 5 Wis. 2d 100, 105, 
92 N.W.2d 247 (1958).5 
                                                 
4 "The subrogation doctrine [] advances an important policy 
rationale underlying the tort system.  It forces a wrongdoer who 
has caused a loss to bear the burden of reimbursing the insurer 
for indemnity payments made to its insured as a result of the 
wrongdoer's acts and omissions."  Ives v. Coopertools, 208 
Wis. 2d 55, 65, 559 N.W.2d 571 (1997) (Geske, J., concurring) 
(citing Elaine M. Rinaldi, Apportionment of Recovery Between 
Insured and Insurer in a Subrogation Case, 29 Tort. & Ins. L.J. 
803 (1994)). 
5 "Although an insured is entitled to indemnity from its 
insurer pursuant to coverage provided under a policy of 
insurance, the insured is entitled only to be made whole, not 
more than whole.  Subrogation prevents an insured from obtaining 
one recovery from the insurer under its contractual obligations 
and a second recovery from the tortfeasor under general tort 
principles."  Ives, 208 Wis. 2d at 65 (Geske, J. concurring).   
No. 00-2036 
 
7 
 
¶16 Ordinarily, subrogation does not arise until the 
creditor's debt or the insured's loss has been fully paid.  
Garrity, 77 Wis. 2d at 541 (citing Hamill v. Kuchler, 203 Wis. 
414, 425, 232 N.W. 877 (1931); Monart Motors v. Home Indemnity 
Co., 1 Wis. 2d 601, 607, 85 N.W.2d 478 (1957)); see also, 4 
Williston on Contracts § 1269 (3d ed. 1967).  In insurance law, 
this principle is sometimes referred to as the antisubrogation 
rule.  Black's Law Dictionary 92 (7th ed. 1999).  In Wisconsin, 
it is known as the made whole doctrine.  Garrity, 77 Wis. 2d at 
538, 541, 547. 
¶17 The made whole doctrine in an insurance context is 
discussed in Couch on Insurance, which describes it as a 
"traditional equity principle" under which a party claiming 
subrogation rights may not recover until the insured is fully 
compensated for his or her losses.  Lee R. Russ & Thomas F. 
Segalla, Couch on Insurance § 223:133 (3d ed. 2000) [hereinafter 
Couch on Insurance].  "[T]he burden of loss should rest on the 
party paid to assume the risk, and not on an inadequately 
compensated insured."  Id. § 223:136.  Once the insured has been 
fully compensated, however, any additional recovery by the 
insured would constitute unjust enrichment.  Id.  The subrogated 
party is therefore entitled to assert its subrogation claim once 
the insured has been made whole.  Id. 
¶18 "The right of subrogation can arise by statute, 
through equity or by contract."  Dailey v. Secura Ins. Co., 164 
Wis. 2d 624, 628, 476 N.W.2d 299 (Ct. App. 1991).  Subrogation 
arising 
from 
contract 
is 
usually 
termed 
"conventional 
No. 00-2036 
 
8 
 
subrogation."  American Ins. Co. v. City of Milwaukee, 51 Wis. 
2d 346, 351, 187 N.W.2d 142 (1971).  "One example of 
'conventional subrogation' is involved where health insurance 
contracts contain provisions for subrogation of payments made to 
the insured, when the insured is injured by negligent acts of a 
third person."  Id. 
¶19 This case concerns such a provision in the group 
insurance plan administered by Humana.  The subrogation clause 
states: 
Reimbursement/Subrogation 
 
The beneficiary agrees that by accepting and in return 
for the payment of covered expenses by the Plan in 
accordance with the terms of this Plan: 
 
1. 
The Plan shall be repaid the full amount of the 
covered 
expenses 
it 
pays 
from 
any 
amounts 
received from others for the bodily injuries or 
losses 
which 
necessitated 
such 
covered 
expense . . . . 
 
2. 
The Plan's right to repayment is, and shall be, 
prior and superior to the right of any other 
person or entity, including the beneficiary. 
 
3. 
The right to recover amounts from others for the 
injuries or losses which necessitate covered 
expenses is jointly owned by the Plan and the 
beneficiary.  The Plan is subrogated to the 
beneficiary’s rights to that extent.  Regardless 
of who pursues those rights, the funds recovered 
shall be used to reimburse the Plan as prescribed 
above; . . . The rights to which the Plan is 
subrogated are, and shall be, prior and superior 
to the rights of any other person or entity, 
including the beneficiary (emphasis omitted). 
¶20 Humana asserts that these contractual provisions are 
specific and unambiguous and override the made whole rule.  It 
No. 00-2036 
 
9 
 
contends that these explicit provisions entitle Humana to 
reimbursement of the covered expenses which it paid on behalf of 
Justin Ruckel, regardless of whether Ruckel is ever fully 
compensated for his injuries.   
¶21 This court addressed similar arguments in Garrity, 77 
Wis. 2d 537, and in Rimes, 106 Wis. 2d 263.  In Garrity, George 
and Helen Garrity (the insured) had a fire insurance policy 
issued by Rural Mutual Insurance Company (Rural Mutual).  The 
limit of their policy was $67,227.12.  When the insured suffered 
a fire loss at their dairy barn and other property——a loss 
totaling approximately $110,000——Rural Mutual paid the couple 
the policy limit of $67,227.12.  Garrity, 77 Wis. 2d at 539. 
¶22 The fire was allegedly caused by the negligence of a 
driver who worked for Bowers Brothers Feed Mill (Bowers).  
Bowers had a $25,000 liability policy issued by the same 
insurer, Rural Mutual, and Bowers and the insurer agreed to pay 
claims under this policy if they were found liable.  Id. 
¶23 The insured sued Bowers and named Rural Mutual as a 
defendant in the suit.  As a defendant, Rural Mutual denied 
negligence on the part of Bowers.  It also filed a third-party 
complaint against itself in its capacity as insurer for the 
Garritys, asking that Rural Mutual pay to itself any amount that 
Bowers owed the Garritys under Bowers' $25,000 policy.  Id. at 
539-40.  Rural Mutual based this claim against itself on the 
subrogation 
clause 
in 
the 
insured's 
standard 
policy: 
"Subrogation.  This Company may require from the insured an 
assignment of all right of recovery against any party for loss 
No. 00-2036 
 
10 
 
to the extent that payment therefor is made by this Company."  
Id. at 540. 
¶24 In the Garrity decision, this court stated the 
question as follows: 
 
The question is: When an insured's loss exceeds 
the amount recoverable under a standard fire insurance 
policy written in conformity with section 203.01, 
Wis. Stats, 1969, what are the respective rights of 
the insured and the subrogated insurer to the damages 
recovered from the tort-feasor who caused the loss?   
Id. at 538. 
¶25 The 
circuit 
court 
ruled 
that 
Rural 
Mutual's 
subrogation clause, approved by reference in Wis. Stat. § 203.01 
(1969-70), gave Rural Mutual "the right of priority in any 
recovery of monies . . . up to the sum of $67,227.12."  Id. at 
540.  This court reversed on two grounds. 
¶26 First, the court laid out the theory of subrogation 
and the made whole doctrine.  It spoke of the concern about 
unjust enrichment.  Id. at 541.  It explained that under common 
law subrogation, "the subrogor (here the insured) must be made 
whole before the subrogee (insurance company) may recover 
anything from the tort-feasor."  Id.  It reasoned that "a surety 
who is subrogated upon partial payment of the debt [or loss] 
becomes a competitor with the creditor (here the insured)" and 
that "where either the insurer or the insured must to some 
extent go unpaid, the loss should be borne by the insurer for 
that is a risk the insured has paid it to assume."  Id. at 542.  
The court also stated pointedly:  
 
No. 00-2036 
 
11 
 
This 
court 
has 
held 
that 
subrogation 
is 
recognized or denied upon equitable principles without 
differentiation 
between 
"legal 
subrogation" 
which 
arises by application of principles of equity and 
"conventional subrogation" arising from contract or 
the acts of the parties.  American Ins. Co. v. 
Milwaukee, 51 Wis.2d 346, 351, 352, 353, 187 N.W.2d 
142 
(1971).  
Thus 
it 
has been 
held 
that the 
conventionally subrogated or contractual insurer has 
no share in the recovery from the tort-feasor if the 
total amount recovered by the insured from the insurer 
does not cover his loss. 
Id. at 543-44. 
¶27 Consequently, under basic principles of subrogation, 
whether the subrogation is "legal" or "conventional," the 
insurer is not entitled to recoup anything until the insured has 
been made whole.  Id. 
¶28 Second, having clearly stated the law, the court made 
the additional observation that the subrogation clause in the 
policy before the court did not contravene the made whole 
doctrine.  It said, "We conclude that the subrogation clause 
contained in the standard fire insurance policy and set forth 
above did not change the substantive common law rights of the 
insured."  Id. at 541.  "We find nothing in this subrogation 
clause that changes the common law rule."  Id. at 544.  Then the 
court went on to say, "We hold that because the contract here 
contains no language to the contrary, the normal rule of 
subrogation [that is, the made whole doctrine] applies and the 
subrogee has no right to share in the fund recovered from the 
tort-feasor until the subrogor is made whole."  Id. at 546-47. 
 
¶29 In retrospect, the phrase "because the contract here 
contains no language" is unfortunate because it undercuts the 
No. 00-2036 
 
12 
 
force of the court's earlier analysis.  Humana has seized upon 
this phrase as the foundation of its case, suggesting that the 
phrase hints that an insurer might be able through "conventional 
subrogation" to override or negate the made whole doctrine. 
¶30 Humana's theory was resoundingly rejected, however, in 
Rimes, 106 Wis. 2d 263, which was decided five years after 
Garrity.  In Rimes, this court precluded the possibility of 
contractual language overriding the made whole doctrine. 
¶31 Palmer Rimes was injured as he was offering assistance 
to the occupants of two cars involved in an accident.  Id. at 
265.  As Rimes tried to help, a third car struck one of the two 
cars, and Rimes was severely injured.  Id.  Rimes and his wife 
(collectively "Rimes" or "the insured") had a liability policy 
issued by State Farm Mutual Insurance Company, under which State 
Farm paid $9,649.90 in medical expenses.  Id. at 265-66.  The 
State Farm policy contained a subrogation clause, and Rimes 
signed a subrogation receipt.  Id.  Rimes brought suit against 
the drivers of each of the other three vehicles, and State Farm 
was joined as a defendant because of its subrogation rights.  
Id. at 265. 
¶32 During the trial, Rimes settled with the tortfeasors 
for $125,000.  Id. at 267.  State Farm signed the stipulated 
settlement.  Id.  State Farm then sought to recover the 
$9,649.90 it paid for Rimes' medical expenses from the Rimes' 
settlement.  Id.  In a trial to the court, the circuit court 
determined that Rimes incurred total damages of $300,433.54, far 
greater than the $125,000 settlement.  Id. at 264-65.  The 
No. 00-2036 
 
13 
 
circuit court therefore concluded that pursuant to Garrity, 
Rimes had not been made whole and State Farm could not recover 
its medical expense payments.  Id. at 265. 
¶33 State Farm appealed and the court of appeals certified 
the case to this court.  We accepted certification "[b]ecause it 
was at least arguable that Garrity might not be precedential for 
the [Rimes] case."  Id. at 269.  We stated the issue as follows: 
 
[W]hether an automobile insurer . . . which, under a 
subrogation agreement signed by its insured . . . has 
made payment under the medical-pay provisions of its 
policy, has the right to recover those payments out of 
the monies received by its insured in a settlement 
with 
negligent 
third-party 
tortfeasors 
and 
their 
liability insurers, when, . . . the settlement figure 
was less than the total damages sustained by the 
insured . . . . 
Id. at 264. 
¶34 The court examined the subrogation agreement in the 
policy issued by State Farm, which stated: 
 
Upon 
payment . . . the 
company 
shall 
be 
subrogated to the extent of such payment to the 
proceeds of any settlement or judgment that may result 
from the exercise of any rights of recovery which the 
injured 
person . . . may 
have 
against 
any 
person . . . and such person shall execute and deliver 
instruments and papers and do whatever else is 
necessary to secure such rights.  Such person shall do 
nothing after loss to prejudice such rights. 
Id. at 266. 
¶35 The court compared this subrogation agreement to the 
one in Garrity, stating: "The subrogation agreement in the 
instant case between Rimes and State Farm is not significantly 
dissimilar and if literally interpreted would permit recovery by 
No. 00-2036 
 
14 
 
State Farm in the amount of medical payments made on behalf of 
Rimes."  Id. at 270. 
¶36 The court did not rely on the text of the subrogation 
clause; it relied on the salient principles of Garrity.  It held 
that while the facts in Rimes were "not on all fours" with those 
in 
Garrity, 
"the 
principles 
set 
forth 
[in 
Garrity] 
are 
applicable and are decisive."  Id.  It therefore affirmed the 
circuit court's determination that the made whole rule applied, 
and barred State Farm's recovery until the insured was fully 
compensated.  Id. 
¶37 The court in Rimes noted that it had determined in 
Garrity that conventional subrogation (contractual subrogation) 
had 
the 
same 
effect 
as 
legal 
subrogation 
(equitable 
subrogation), 
so 
"accordingly, 
the 
contractual 
terms 
of 
subrogation agreements in an insurance policy were to be applied 
according to the rules of equity."  Id. at 271.  It further 
stated, "Wisconsin has long held . . . an insurer claiming 
subrogation under contract . . . is to be allowed no share in 
the recovery from the tortfeasor if the total amount recovered 
by the insured from the insurer and the wrongdoer does not cover 
his entire loss."  Id. at 271. 
¶38 The court summarized Wisconsin’s law of subrogation, 
stating, "It appears clear that, under Wisconsin law as 
recapitulated in Garrity, one who claims subrogation rights, 
whether under the aegis of either legal or conventional 
subrogation, is barred from any recovery unless the insured is 
made whole."  Id. at 272. 
No. 00-2036 
 
15 
 
¶39 The effect of the Rimes decision was underscored by 
one of the dissenting justices, Donald W. Steinmetz.  Justice 
Steinmetz said that Garrity had two holdings, the second of 
which was that "because the contract here contains no language 
to the contrary, the normal rule of subrogation applies and the 
subrogee has no right to share in the fund recovered from the 
tort-feasor until the subrogor is made whole."  Id. at 286 
(Steinmetz, J., dissenting) (quoting Garrity, 77 Wis. 2d at 546-
47). 
 He asserted that 
the second 
holding 
implied the 
possibility that contractual language "could influence" or 
override the equitable principles of subrogation.  He then 
admitted that the majority had given "short shrift" to that 
possibility.  Id.  He summarized the Rimes holding as requiring 
that the insured must be made whole before an insurer has any 
right of recovery.  Id. at 290.   
¶40 We conclude that the impact of Garrity and Rimes upon 
this case is indisputable: Justin Ruckel suffered damages of 
more than $450,000.  Humana contributed about $87,000 to 
Ruckel's 
medical 
expenses. 
 
Notwithstanding 
a 
specific, 
unambiguous subrogation clause in the Humana-administered group 
benefit plan that gave the plan superior rights of subrogation 
over Ruckel's right to be made whole, the plan may not recover 
any of the $86,626.01 in medical expenses it paid out until 
Ruckel has been made whole. 
¶41 Humana contends that the language of the subrogation 
clause is unambiguous and that its intent is absolutely clear.  
This argument misses the point.  The clause is not unclear; it 
No. 00-2036 
 
16 
 
is inequitable.  It is contrary to the most fundamental precepts 
of subrogation.  Subrogation in this circumstance would not 
avoid double recovery or prevent unjust enrichment of the 
insured.  It would authorize incomplete recovery for the insured 
and shift loss from the insurer, who was paid to assume loss, to 
the insured, who paid to protect against loss.6  As the Wisconsin 
Academy of Trial Lawyers correctly notes in its brief as amicus 
curiae, subrogation on these facts would turn "the entire 
doctrine of subrogation on its head." 
¶42 Humana also argues that the equities in this case tilt 
toward the plan, because it is a group insurance benefit plan 
self-funded by the taxpayers of Mayville, a small school 
district.  However appealing these arguments may be, they are 
better addressed to a legislative body.7 
                                                 
6 We acknowledge that some sticky issues are raised when the 
insured has contributed to his or her own loss, Sorge v. Nat'l 
Car Rental Sys., Inc., 182 Wis. 2d 52, 512 N.W.2d 505 (1994), or 
when the insured settles the case for an amount less than the 
alleged total damages without involving the subrogated insurer, 
Ives v. Coopertools, 208 Wis. 2d 55, 559 N.W.2d 571 (1997).  
These issues are not present in this case. 
7 In some instances, legislatively-sanctioned subrogation 
may override the made whole principles discussed in this case.  
Some examples include: (1) self-funded employee pension and 
benefit plans under The Federal Employee Retirement Income 
Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001-1461 (see FMC 
Corp. v. Holliday, 498 U.S. 52, 58-65 (1990); Petro v. D.W.G. 
Corp., 148 Wis. 2d 725, 727-28, 436 N.W.2d 875 (Ct. App. 1989)); 
(2) government subrogation rights for certain public assistance 
payments under Wis. Stat. § 49.89 (formerly Wis. Stat. § 49.65) 
(see Waukesha County v. Johnson, 107 Wis. 2d 155, 320 N.W.2d 1 
(Ct. App. 1982)); and (3) subrogation rights in worker's 
compensation cases under Wis. Stat. § 102.29(1) (see Martinez v. 
Ashland Oil, 132 Wis. 2d 11, 390 N.W.2d 72 (Ct. App. 1986)). 
No. 00-2036 
 
17 
 
CONCLUSION 
¶43 For the reasons stated above, we hold that pursuant to 
this court’s holdings in Garrity and Rimes, an insurer is not 
entitled to subrogation against its insured unless and until the 
insured is made whole, regardless of contractual language to the 
contrary.  We therefore affirm the decision of the circuit 
court. 
By the Court.—The judgment of the circuit court is 
affirmed. 
 
 
No. 00-2036 
 
 
 
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