Title: American Family Mutual Ins. Co. v. David Golke
Citation: 2009 WI 81
Docket Number: 2006AP003003
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: July 15, 2009

2009 WI 81 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
CASE NO.: 
2006AP3003 
COMPLETE TITLE: 
 
 
American Family Mutual Insurance Company, 
          Plaintiff-Appellant, 
David Ronaldson, 
          Involuntary-Plaintiff, 
     v. 
David Golke, Joseph Golke, Charles Golke, Golke 
Brothers Roofing and Siding LLC and Indiana 
Insurance Company, 
          Defendants-Respondents, 
Ellington Mutual Insurance Company, 
          Intervenor-Defendant. 
 
 
 
 
ON CERTIFICATION FROM THE COURT OF APPEALS 
 
 
OPINION FILED: 
July 15, 2009   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
December 2, 2008   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Waupaca   
 
JUDGE: 
Raymond S. Huber   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
ABRAHAMSON, C.J., concurs (opinion filed). 
BRADLEY, J., joins concurrence.   
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the plaintiff-appellant there were briefs by Charles W. 
Kramer, Monte E. Weiss, and Deutch & Weiss, LLC, Milwaukee, and 
oral argument by Charles W. Kramer. 
 
For 
the 
defendants-respondents, 
Joseph 
Golke, 
Charles 
Golke, and Golke Brothers Roofing and Siding, LLC, there was a 
brief filed by Michael P. Konz, Erik L. Fuehrer, and Gabert, 
Williams, Konz & Lawrynk, LLP, Appleton, and oral argument by 
Michael P. Konz. 
 
For the defendants-respondents, David Golke and Indiana 
Insurance Company, there was a brief by Peter M. Farb and Law 
Offices of Thomas P. Stilp, Appleton, and oral argument by Peter 
M. Farb. 
 
 
 
2 
An amicus curiae brief was filed by Ryan L. Woody, Gary L. 
Wickert, and Matthiesen, Wickert & Lehrer, S.C., Hartford, on 
behalf of the National Association of Subrogation Professionals. 
 
An amicus curiae brief was filed by Arnold P. Anderson and 
Mohr & Anderson, LLC, Madison, on behalf of the Wisconsin 
Reinsurance Corporation. 
 
 
 
 
2009 WI 81
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2006AP3003  
(L.C. No. 
2003CV112) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
American Family Mutual Insurance Company, 
 
          Plaintiff-Appellant, 
 
David Ronaldson, 
 
          Involuntary-Plaintiff, 
 
     v. 
 
David Golke, Joseph Golke, Charles Golke, Golke 
Brothers Roofing and Siding LLC and Indiana 
Insurance Company, 
 
          Defendants-Respondents, 
 
Ellington Mutual Insurance Company, 
 
          Intervenor-Defendant. 
FILED 
 
JUL 15, 2009 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
APPEAL from an order and a judgment of the Circuit Court 
for Waupaca County, Raymond S. Huber, Judge.  Reversed and cause 
remanded. 
 
¶1 
MICHAEL J. GABLEMAN, J.  This is an appeal pursuant to 
Wis. Stat. § 809.61 (2007-08)1 in which American Family Insurance 
                                                 
1 All subsequent references to the Wisconsin Statutes are to 
the 2007-08 version unless otherwise indicated. 
No. 
2006AP3003   
 
2 
 
Co. ("American Family") seeks review of the judgment of 
dismissal entered by the Circuit Court for Waupaca County, 
Raymond S. Huber, Judge. 
¶2 
American Family brought a cause of action against 
three brothers——David, Joseph, and Charles Golke, Golke Brothers 
Roofing and Siding LLC, and Indiana Insurance Co. ("Indiana 
Insurance")2 for damages alleged to have arisen from negligent 
roof repairs.  American Family claimed that the Golkes' 
negligent roof repair caused a fire that damaged a home owned by 
its insured, the Ronaldsons.  The circuit court found that 
American Family had failed to preserve any portion of the 
pertinent roof or chimney sections when it knew or should have 
known that litigation was likely.  The circuit court further 
found that American Family did not give the Golkes sufficient 
notice of a claim against them or of the impending destruction 
of the fire scene.  Concluding that this amounted to improper 
destruction of evidence, or "spoliation," the circuit court 
dismissed American Family's suit as a sanction for spoliation 
and entered judgments in favor of all defendants. 
¶3 
American Family appealed, and the court of appeals 
certified two questions to us.  First, under what circumstances 
may evidence crucial to a potential legal claim be destroyed?  
Second, what notice must be given to a civil litigant before 
                                                 
2 For convenience, we refer to these defendants-respondents 
collectively 
as 
"the 
Golkes" 
in 
this 
opinion. 
 
Where 
distinctions are appropriate, we will refer to the relevant 
party or parties by name. 
No. 
2006AP3003   
 
3 
 
such evidence is destroyed?  The certification by the court of 
appeals also discussed the proper standard for imposing the 
sanction of dismissal for spoliation. 
¶4 
We therefore address the following issues: (1) When 
does a party or potential litigant discharge its duty to 
preserve evidence relevant to a potential legal claim; (2) Can 
sufficient notice be effectuated by the mailing of a letter via 
first-class mail; and (3) When is dismissal an appropriate 
sanction for spoliation of evidence? 
¶5 
We conclude that the duty to preserve relevant 
evidence is discharged when a party or potential litigant with a 
legitimate reason to destroy evidence provides reasonable notice 
of a possible claim, the basis for that claim, the existence of 
evidence relevant to the claim, and a reasonable opportunity to 
inspect that evidence.  We further hold that such notice can be 
properly effectuated by mailing a letter via first-class mail.  
We also affirm that dismissal is an appropriate sanction for 
spoliation of evidence only if a party acts egregiously——that 
is, in a conscious effort to affect the outcome of litigation or 
in 
flagrant, 
knowing 
disregard 
of 
the 
judicial 
process.  
Applying the law to the facts of this case, we conclude that as 
a matter of law, Joseph and Charles Golke received the March 13, 
2000, letter, and that American Family provided the Golkes with 
reasonable and sufficient notice, thereby discharging its duty 
to preserve the evidence from the fire.  The circuit court 
therefore erroneously exercised its discretion when it dismissed 
American Family's suit.  Because American Family discharged its 
No. 
2006AP3003   
 
4 
 
duty to preserve evidence and no sanctions are appropriate, the 
judgment of the circuit court is reversed, and the cause is 
remanded to the circuit court for trial on the merits. 
I. FACTS 
¶6 
On February 13, 2000, fire damaged a home owned by 
David and Lori Ronaldson.  The home was insured by American 
Family, which appointed a field examiner, Albert Hlavachek, and 
a fire origin and cause expert, Todd Haltaufderheid, to handle 
the case.  On February 14, 2000, they inspected the home and 
concluded that the fire began near a metal chimney that extended 
through the roof.  After further investigation, Haltaufderheid 
discovered that the three Golke brothers——David, Joseph, and 
Charles——had performed roof repairs on the Ronaldson home in 
1994. 
¶7 
When the Golke brothers performed construction on the 
Ronaldson's home, they were all working together in one 
partnership.  This partnership was insured by Indiana Insurance 
until 
1997 
when 
the 
partnership 
dissolved. 
 
After 
the 
partnership 
dissolved, 
David 
Golke 
continued 
to 
perform 
construction work as a sole proprietor and retained Indiana 
Insurance as his insurance provider.  Joseph and Charles Golke 
formed a new partnership, later transformed into a limited 
liability company, which was insured by Ellington Mutual 
Insurance. 
¶8 
On February 22, 2000, Haltaufderheid met with Charles 
Golke at Joseph and Charles Golke's business address.  During 
that meeting, Haltaufderheid confirmed that the construction 
No. 
2006AP3003   
 
5 
 
work on the Ronaldson home was performed by the Golkes.  
Haltaufderheid later concluded that their actions had reduced 
the clearance between the chimney and the wood underlying the 
roof, and that this reduced clearance allowed the hot chimney to 
heat the surrounding wood to the point of ignition, leading to 
the fire that damaged the home.  American Family determined that 
repair was not possible, and that the home would have to be 
demolished and rebuilt. 
¶9 
On March 13, 2000, Hlavachek, the American Family 
field examiner, mailed letters to the Golkes after he learned of 
their involvement with the roof construction.3  One copy was 
mailed to David Golke; the other copy was mailed to Joseph and 
Charles Golke at their business address.  This correspondence 
was sent via United States Postal Service first-class mail, not 
certified mail.  The letter stated the date of the loss 
(3/13/2000), the name of the insureds (the Ronaldsons), the 
address of the home, that the loss of property resulted from 
fire, and that the amount of loss was pending.  The body of the 
letter stated in full as follows: 
This letter is to put you and your roofing company on 
notice for the fire damage that occurred on the above 
date of loss.  Our investigation determined that you 
were negligent for work performed on our insured's 
property at the above loss location. 
If you have a liability insurance carrier, please 
forward this letter to them and we will handle these 
                                                 
3 The parties dispute whether the March 13, 2000, letter was 
actually sent to Joseph and Charles Golke.  We address this 
further below. 
No. 
2006AP3003   
 
6 
 
matters directly with them.  If you do not have a 
liability insurance carrier, we will expect you to pay 
for 
the 
repairs/replacement. 
 
The 
amount 
of 
repairs/replacement at this time is pending. 
To 
provide 
adequate 
time 
for 
yourself 
or 
your 
liability carrier to conduct a proper investigation, 
any destruction of the fire damaged building will not 
take place until April 1, 2000. 
¶10 David Golke admitted receiving this letter, which he 
forwarded to his insurer, Indiana Insurance.  Indiana Insurance 
sent a response letter to American Family on March 17, 2000, 
acknowledging the potential claim but denying coverage.4  On 
March 23, 2000, American Family replied to both Indiana 
Insurance and David Golke by letter recommending that they 
investigate the fire scene if they so desired because American 
Family was "planning demolition to begin on April 1, 2000." 
¶11 American Family did not receive any response to the 
March 13, 2000, letter from Joseph or Charles Golke or any 
insurer on their behalf.  Though not denying receipt, Joseph and 
Charles Golke claimed not to recall receiving the March 13, 
2000, letter.  Charles Golke testified at trial that he and 
Joseph Golke had experienced some difficulty in securing 
accurate and reliable mail service at their business address. 
¶12 On April 6, 2000, Hlavachek sent a second letter, this 
time via United States Postal Service certified mail, with 
copies being sent to both David Golke, and Joseph and Charles 
Golke at their business address.  This second letter also stated 
                                                 
4 Indiana Insurance later determined that it did cover David 
Golke with respect to this claim. 
No. 
2006AP3003   
 
7 
 
the date of the loss, the name of the insureds, the address of 
the home, that the loss of property resulted from fire, and that 
the amount of loss was pending.  The body of the letter 
provided: 
This is our second request for insurance information 
concerning your liability regarding the above loss. 
All losses must be reported to your insurance company 
on a timely basis. Failure to do so may result in 
denial of your coverages due to your failure to meet 
policy conditions. 
You will need to contact your current insurance 
carrier and have them contact us as soon as possible. 
¶13 Both David and Joseph Golke admitted that they 
received copies of the second letter.  At trial, Joseph Golke 
initially claimed not to recall receiving the second letter, but 
when confronted with his signature on the delivery receipt, 
admitted that he received it on April 7, 2000.  Charles Golke 
also admitted receiving that letter.  Charles Golke called 
Hlavachek in response to the letter on April 8, 2000, leaving a 
message for him.  Hlavachek returned Charles Golke's message 
that same day at 5:37 p.m., but there was no answer, and 
Hlavachek did not leave a message. 
¶14 None 
of 
the 
three 
Golke 
brothers, 
the 
limited 
liability roofing company, the insurers, or anyone else on their 
behalf contacted American Family to arrange for inspection of 
the burned home, nor did anyone (or any defendant) request an 
extension of the inspection period.  American Family's adjuster 
No. 
2006AP3003   
 
8 
 
testified that he "definitely" would have granted an extension 
if so requested. 
¶15 Although American Family's first letter stated that 
demolition of the home would occur on April 1, 2000, the 
demolition and rebuilding did not begin until sometime after 
April 11, 2000.5  Neither American Family nor its experts 
preserved any physical evidence of the roof, chimney, or any 
other part of the fire scene.  The Golkes urge that American 
Family's failure to preserve physical evidence, such as the 
chimney and surrounding roof sheathing, fell short of applicable 
fire investigation industry standards as articulated in the 
National Fire Protection Association's Publication 921 and the 
American Society for Testing and Materials' publication E 1188-
95——both of which state that fire inspectors should preserve 
physical evidence from a fire scene.6  American Family, however, 
did retain many photographs and drawings of the fire scene 
produced by its experts who inspected the home before its 
demolition.  American Family shared these materials with the 
Golkes and their fire experts during discovery. 
II. PROCEDURAL HISTORY 
¶16 Despite additional attempted contacts, American Family 
heard nothing from the Golkes and brought suit on March 14, 
                                                 
5 The record is unclear as to the precise dates of both 
demolition and commencement of construction on the new home. 
6 David Golke and Indiana Insurance Company asked this court 
to take judicial notice of this publication or supplement the 
record with it.  We deny the motion. 
No. 
2006AP3003   
 
9 
 
2003, against David, Joseph, and Charles Golke, Golke Brothers 
Roofing and Siding LLC, and Indiana Insurance for damages 
arising from the fire.7  All defendants filed motions for an 
order dismissing American Family's claims for spoliation of 
evidence.  The circuit court denied the motions and the case 
proceeded to a bench trial on the issues of spoliation and 
sufficiency of notice. At the conclusion of the evidentiary 
portion of the trial, the defendants renewed their motions, 
arguing that American Family's claims should be dismissed for 
spoliation.  The circuit court then dismissed American Family's 
claims as a sanction for its failure to preserve any physical 
evidence. 
¶17 American Family appealed, contending that the circuit 
court erred in dismissing its cause without first finding that 
American Family acted egregiously.  American Family asserted 
that its actions were not egregious, and that dismissal of its 
cause was an erroneous exercise of discretion.  Pursuant to Wis. 
Stat. 
§ 
809.61, 
the 
court 
of 
appeals 
certified 
the 
aforementioned questions to this court. 
III. STANDARD OF REVIEW 
¶18 Under Wis. Const. art. VII, § 3(3), by accepting the 
certified appeal, we acquire jurisdiction of the entire appeal, 
not merely the questions certified.  State v. Stoehr, 134 
Wis. 2d 66, 70, 396 N.W.2d 177 (1986); Wis. Stat. §§ 808.05(2), 
                                                 
7 Ellington Mutual Insurance Co. later intervened and 
asserted that it provided no coverage for Joseph Golke, Charles 
Golke, or their limited liability roofing company. 
No. 
2006AP3003   
 
10 
 
808.05(3), and (Rule) 809.61.  We review the decision to impose 
sanctions for spoliation of evidence for erroneous exercise of 
discretion.  City of Stoughton v. Thomasson Lumber Co., 2004 WI 
App 6, ¶38, 269 Wis. 2d 339, 675 N.W.2d 487.  Whether a court 
applied the correct legal standard in exercising its discretion 
is a question of law which we review de novo.  Garfoot v. 
Fireman's Fund Ins. Co., 228 Wis. 2d 707, 717, 599 N.W.2d 411 
(Ct. App. 1999). 
IV. DISCUSSION 
¶19 Our initial task is to examine the questions addressed 
to us by the court of appeals.  First, we discuss the standard 
for when a party or potential litigant discharges its duty to 
preserve relevant evidence.  We conclude that this duty is 
discharged when a party or potential litigant with a legitimate 
reason to destroy evidence provides reasonable notice of a 
possible claim, the basis for that claim, the existence of 
evidence relevant to the claim, and reasonable opportunity to 
inspect that evidence prior to its destruction.  Second, we 
address whether mailing a letter via first-class mail can 
constitute sufficient notice, answering the question in the 
affirmative.  Third, we address when dismissal is an appropriate 
sanction for spoliation of evidence, concluding that dismissal 
is only appropriate if a party acts egregiously.  After 
establishing the relevant legal standards, we apply them to the 
facts of this case and conclude that American Family had a 
legitimate reason to destroy evidence, and gave the Golkes 
No. 
2006AP3003   
 
11 
 
reasonable and sufficient notice, thereby discharging its duty 
to preserve the evidence from the fire. 
A. 
 
¶20 The court of appeals first asked us to address the 
following: Under what circumstances may evidence crucial to a 
potential legal claim be destroyed?  This question concerns when 
a party or potential litigant discharges its duty to preserve 
relevant evidence. 
¶21 Every party or potential litigant is duty-bound to 
preserve evidence essential to a claim that will likely be 
litigated.  Sentry Ins. v. Royal Ins. Co. of Am., 196 
Wis. 2d 907, 918, 539 N.W.2d 911 (Ct. App. 1995).  Spoliation is 
the 
"intentional 
destruction, 
mutilation, 
alteration, 
or 
concealment of evidence."  Black's Law Dictionary 1409 (7th ed. 
1999).  Courts have discretionary authority to sanction parties 
who destroy or withhold evidence relevant to pending or future 
litigation.  See Estate of Neumann v. Neumann, 2001 WI App 61, 
¶80, 242 Wis. 2d 205, 626 N.W.2d 821.  These sanctions serve two 
main purposes: "(1) to uphold the judicial system's truth-
seeking function and (2) to deter parties from destroying 
evidence."  Insurance Co. of N. Am. v. Cease Elec. Inc., 2004 WI 
App 15, ¶16, 269 Wis. 2d 286, 674 N.W.2d 886. 
¶22 In the case at bar, the parties dispute whether the 
general duty to preserve relevant evidence may be discharged, 
and if so, what a party or potential litigant must do to 
discharge that duty.  David Golke (along with his insurer, 
Indiana Insurance) argues that evidence must be preserved until 
No. 
2006AP3003   
 
12 
 
and unless all parties consent to its destruction.  American 
Family asserts that a party or potential litigant's duty to 
preserve evidence is discharged once it has given notice and an 
opportunity to test or inspect the evidence.  Joseph and Charles 
Golke (along with their partnership, Golke Brothers Roofing and 
Siding LLC) appear to agree with American Family that the duty 
to preserve evidence may be discharged with proper notice 
regarding the claim and the impending destruction of evidence.8 
¶23 Though a question of first impression for this court, 
multiple 
jurisdictions have either directly or indirectly 
addressed the question of whether and under what preconditions a 
party or potential litigant may legitimately destroy relevant 
evidence.  Several illustrative cases demonstrate a pattern. 
¶24 In Allstate Ins. Co. v. Hamilton Beach/Proctor Silex, 
Inc., 473 F.3d 450, 458 (2d Cir. 2007), the Second Circuit 
considered a subrogation9 claim for a home fire allegedly caused 
by a coffee maker.  On the date of the fire, the insurer sent 
the defendant product manufacturer a letter notifying it of the 
potential claim and offering to preserve the fire scene for 
                                                 
8 Joseph and Charles Golke do maintain, however, that 
American Family has not provided sufficient notice. 
9 Subrogation, the claim also at issue here, is a cause of 
action "[w]here one party is substituted 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).  Here, American 
Family substitutes itself in place of the Ronaldsons and is 
allowed to pursue this action against third parties as if it 
stepped into the Ronaldsons' shoes.   
No. 
2006AP3003   
 
13 
 
inspection.  Id. at 457.  The manufacturer sent a representative 
to the scene two weeks later, who indicated he wanted to 
preserve the remains of the coffee maker and a receptacle, not 
the range or range hood which were also potential causes of the 
fire.  Id.  The insurer then took detailed pictures of the range 
and range hood and discarded them after ruling them out as a 
cause of the fire.  Id.  However, the manufacturer's initial 
inspector passed away, and the new representative was unable to 
state conclusively that the range and range hood were not the 
causes of the fire without an opportunity to examine the 
discarded evidence.  Id. at 453. 
¶25 The U.S. District Court for the District of Vermont 
found that it would be inequitable to allow the insurer to use 
this evidence, and excluded it.  Id. at 457.  The insurer argued 
that this was effectively a sanction for spoliation, and that 
the district court's actions constituted an abuse of discretion 
because the insurer provided the manufacturer a "full and fair 
opportunity to examine the fire scene as well as the alternate 
potential ignition sources."  Id. at 457-58.  The Second Circuit 
held that the duty to preserve evidence was not perpetual, and 
that the district court abused its discretion by effectively 
sanctioning the insurer for spoliation of evidence even though 
it provided the manufacturer with a full and fair opportunity to 
inspect the evidence, and the defendant manufacturer disclaimed 
interest in that evidence.  Id. at 458. 
¶26 In another case on point, a homeowner made one phone 
call to a car dealer complaining that the car he bought from the 
No. 
2006AP3003   
 
14 
 
dealer started on fire while in his garage, causing his home to 
burn down.  Hoffman v. Ford Motor Co., 587 N.W.2d 66, 68 (Minn. 
Ct. App. 1998).  The homeowner did not make any claim or demand 
during his phone call, did not request or instruct the dealer to 
undertake an investigation, and did not indicate how the fire 
started or whether the car dealer or manufacturer may be liable.  
Id. at 70-71.  Neither the homeowner nor his insurer ever 
informed the car dealer or manufacturer that they intended to 
pursue a claim against either of them, that the car and home 
were available for inspection, or that the car and home would 
soon be destroyed.  Id.  Before the car's manufacturer was given 
an opportunity to inspect them, the home was destroyed, the car 
had been allowed to corrode and degrade in a salvage yard for 
several months, and some of the car's parts that were allegedly 
the cause of the fire were damaged or lost.  Id. at 71. 
¶27 The Hoffman court concluded that "to be sufficient in 
content, 
a 
spoliation 
notice 
must 
reasonably 
notify 
the 
recipient of a breach or a claim."  Id. at 70.  The court 
equated the purposes of a notice of evidence spoliation to the 
purposes of the notice a purchaser owes to a seller as a 
precondition of bringing a U.C.C. claim for breach of warranty, 
explaining as follows: 
First, notice provides the seller a chance to correct 
any defect. Second, notice affords the seller an 
opportunity to prepare for negotiation and litigation. 
Third, notice provides the seller a safeguard against 
stale claims being asserted after it is too late for 
the manufacturer or seller to investigate them. 
No. 
2006AP3003   
 
15 
 
Id. (citing Church of the Nativity of Our Lord v. Watpro, Inc., 
491 N.W.2d 1, 5-6 (Minn. 1992)).  The court concluded that the 
content of the phone call constituted insufficient notice.  Id. 
at 72.  It therefore excluded all evidence and testimony 
regarding the cause of the fire that derived from the insurer's 
investigation of both the car and garage as a sanction for 
spoliation.  Id.  As a result, the claim was dismissed for lack 
of evidence.  Id. 
¶28 Numerous other courts have outlined or suggested 
similar principles.10  These cases reveal a loose consensus 
                                                 
10 See, e.g., N. Assurance Co. v. Ware, 145 F.R.D. 281, 284 
(D. Me. 1993) (holding that "reasonable notice to likely 
adversaries" that the evidence was to be destroyed would be 
sufficient to prevent a sanction for spoliation); Cooper v. 
United Vaccines, Inc., 117 F. Supp. 2d 864, 875 (E.D. Wis. 2000) 
(stating that the claim might not have been dismissed if the 
plaintiff had notified the defendant of its intention to engage 
in destructive testing of the evidence so that the defendant 
could have participated or conducted its own testing); Howell v. 
Maytag, 168 F.R.D. 502, 506 (M.D. Pa. 1996) (stating that 
"plaintiffs could reasonably have given [the defendant] notice 
of the potential claim, and provided it with an opportunity to 
conduct an independent investigation before the demolition of 
the fire scene."); Baliotis v. McNeil, 870 F. Supp. 1285, 1290-
91 (M.D. Pa. 1994) (stating that relevant evidence should not be 
destroyed without giving the other party an opportunity for 
inspection); Hirsch v. Gen. Motors Corp., 628 A.2d 1108, 1122 
(N.J. Super. Ct. Law Div. 1993) (holding that a "potential 
spoliator 
need 
do 
only 
what 
is 
reasonable 
under 
the 
circumstances," which included allowing defendants a reasonable 
amount of time to inspect the evidence and giving notice of 
probable litigation (citation omitted)); Hamilton Mut. Ins. Co. 
of Cincinnati v. Ford Motor Co., 702 N.E.2d 491, 493 (Ohio Ct. 
App. 1997) (holding that exclusion of expert testimony as a 
sanction for spoliation was improper because the defendant had 
been given multiple notices and opportunities to inspect the 
evidence and had indicated that it would not do so). 
 
No. 
2006AP3003   
 
16 
 
grounded in the idea that a party or potential litigant may 
discharge its duty by giving the other side notice of a 
potential claim and a full and fair opportunity to inspect 
relevant evidence.  We hold, therefore, that a party or 
potential litigant with a legitimate reason to destroy evidence11 
discharges its duty to preserve relevant evidence within its 
control by providing the opposing party or potential litigant: 
(1) reasonable notice of a possible claim; (2) the basis for 
that claim; (3) the existence of evidence relevant to the claim; 
and (4) reasonable opportunity to inspect that evidence. 
¶29 The specific method or frequency of such notice is 
less significant.  Rather, the trial court must use its own 
judgment, its own discretion, to determine whether the content 
of the notice is sufficient in light of the totality of the 
circumstances.  Relevant facts might include the length of time 
evidence can be preserved, the ownership of the evidence, the 
prejudice posed to possible adversaries by the destruction of 
the evidence, the form of the notice, the sophistication of the 
parties, and the ability of the party in possession of the 
evidence to bear the burden and expense of preserving it.  This 
framework serves the judicial system's truth-seeking function 
and effectively prevents parties from prematurely destroying 
evidence.  See Insurance Co. of N. Am., 269 Wis. 2d 286, ¶16. 
                                                 
11 In this case, American Family had a legitimate reason to 
destroy the home——the Ronaldsons needed a place to live. 
No. 
2006AP3003   
 
17 
 
¶30 A rule that does not allow a party or potential 
litigant to discharge its duty to preserve evidence unless all 
other parties consent, as David Golke urges,12 is neither 
practical nor fair.  Such a rule would place the party in 
control of the evidence at the mercy of its adversary who would 
be indirectly rewarded for withholding its consent to destroy 
evidence.  An adversary would have no incentive to either 
inspect the evidence or grant its consent to the destruction of 
evidence.  This is to say nothing of the unfairness to insureds 
who (like the homeowners in this case) could be stuck in limbo 
while a court-endorsed and costly waiting game ensued between 
the parties.  We cannot endorse a rule that encourages such 
brinkmanship. 
B. 
 
¶31 The second question the court of appeals certified to 
us is really a subset of the first: What notice must be given to 
a civil litigant before the evidence is destroyed?  We have 
already answered the substance of this question, stating that 
notice sufficient to discharge the duty to preserve evidence 
requires: (1) reasonable notice of a possible claim; (2) the 
basis for that claim; (3) the existence of evidence relevant to 
the claim; and (4) reasonable opportunity to inspect that 
evidence. 
                                                 
12 He bases this assertion on the National Fire Protection 
Association and American Society for Testing and Materials 
standards which state that fire inspectors should preserve 
physical evidence from a fire scene. 
No. 
2006AP3003   
 
18 
 
¶32 We do wish to address one sub-point regarding notice 
that is particularly relevant under the facts of this case——
whether notice can be effectuated via first-class mail, or 
whether some other method is required.  This question is focused 
on the method of delivery of the notice, not the required 
content (which we have already addressed above).  Joseph and 
Charles Golke argue that American Family has the burden to prove 
receipt of the March 13, 2000, letter, and that it did not meet 
this burden.  Specifically, they assert that sufficient notice 
of this type must be either by personal service, as with a 
summons and complaint under Wis. Stat. § 801.11, or certified 
mail with a return receipt or reply required.  American Family 
counters that first-class mail is a common and accepted form of 
notice throughout the law. 
¶33 The legislature has long recognized that first-class 
mail service is an efficient mechanism that is reasonably 
calculated to provide actual notice of possible or pending 
litigation and effective alteration of substantive legal rights 
and 
interests. 
See, 
e.g., 
Wis. 
Stat. 
§ 631.36(2)(b)-(c) 
(providing for cancellation of insurance policies ten days after 
notice is sent by first-class mail); Wis. Stat. § 968.04(3)(b)2 
(providing for a person's arrest on a warrant issued if he fails 
to appear for court as directed in a summons served by mail); 
Wis. Stat. § 48.977(4)(c)2 (providing for notice of a hearing on 
a petition to appoint a guardian for a child to be sent to the 
child's parents and others by first-class mail); Wis. Stat. 
§ 146.819(3)(a) (providing for the deletion or destruction of a 
No. 
2006AP3003   
 
19 
 
patient's medical records 35 days after notice is sent by first-
class mail). 
¶34 Contrary to Joseph and Charles Golke's suggestion, 
even the commencing of multimillion dollar lawsuits may be 
effectuated by sending the summons and complaint via first-class 
mail if personal service is not possible.  See Wis. Stat. 
§ 801.11(1)(c).  The service of pleadings and other papers in a 
lawsuit may also be accomplished through first-class mail.  See 
Wis. Stat. § 801.14(2).  Both the legislature and this court13 
have affirmed the sufficiency of notice by mail in a variety of 
circumstances. 
¶35 Notice by mail is usually considered complete not upon 
proof of receipt, but upon mailing.  See id. ("Service by mail 
is complete upon mailing."); see also Wis. Stat. § 891.46 
("[n]otices . . . required or authorized to be served by mail in 
judicial or administrative proceedings are presumed to be served 
when deposited in the U.S. mail with properly affixed evidence 
of prepaid postage."); Mansfield v. Smith, 88 Wis. 2d 575, 588, 
277 N.W.2d 740 (1979) (discussing the "mailbox rule," that 
acceptance of a contract is effective upon mailing, and noting 
that "[m]ailing is sufficient to satisfy the legal requirements 
imposed in the day-to-day conduct of business"). 
¶36 Accordingly, evidence of mailing a letter raises a 
rebuttable presumption that the addressee received the letter.  
                                                 
13 State ex rel. Flores v. State, 183 Wis. 2d 587, 612-14, 
516 N.W.2d 362 (1994). 
No. 
2006AP3003   
 
20 
 
See State ex rel. Flores v. State, 183 Wis. 2d 587, 612, 516 
N.W.2d 362 (1994) ("It is well established that the mailing of a 
letter creates a presumption that the letter was delivered and 
received.").14  Once the presumption of mailing has been 
established, the burden shifts to the party challenging receipt 
to present credible evidence of non-receipt.  Id. at 613.  The 
presumption may not be overcome without a denial of receipt.  
Id.  If receipt is denied, the issue is a credibility question 
to be resolved by the factfinder.  Id.  Mere non-remembrance of 
receipt is not enough; the presumption of receipt cannot be 
overcome without denial.15  See id. 
                                                 
14 See also, State v. Kemp, 106 Wis. 2d 697, 709, 318 
N.W.2d 13 (1982) (referring to "the presumption of receipt from 
mailing"); Greene v. Donner, 198 Wis. 122, 126, 223 N.W. 427, 
(1929) ("The presumption of the receipt of the notice which the 
law raises is a rebuttable presumption."); Nack v. State, 189 
Wis. 633, 636, 208 N.W. 487 (1926) ("The copy of the letter was 
received on the theory that the mailing of the letter was 
presumptive 
evidence 
of 
its 
receipt. . . . [T]here 
was 
a 
presumption that defendant received the letter."); Reeves v. 
Midland Cas. Co., 170 Wis. 370, 377, 174 N.W. 475 (1919) ("From 
the proof of mailing a presumption arises that [the notice] was 
received 
by 
the 
[addressee]."); 
Mullen 
v. 
Braatz, 
179 
Wis. 2d 749, 756, 508 N.W.2d 446 (Ct. App. 1993) ("The mailing 
of 
a 
letter 
creates a presumption that the letter was 
delivered," but the presumption is rebuttable.). 
15 Even in 1897, when this court held that mailing a letter 
was prima facie evidence of its receipt (rather than raising a 
presumption of receipt), an express denial of receipt was 
required to challenge the evidence. McDermott v. Jackson, 97 
Wis. 64, 75, 72 N.W. 375 (1897) ("Defendant did not deny having 
received the letter.  He said he did not remember having 
received it.  That did not weaken the prima facie effect of the 
evidence."). 
No. 
2006AP3003   
 
21 
 
¶37 In sum, notice can be effectuated by first-class mail, 
and evidence of mailing creates a presumption of receipt that 
may create an issue for the factfinder only by denial of 
receipt. 
C. 
¶38 Though not a certified question, the court of appeals 
addressed additional questions to us regarding egregious conduct 
and spoliation sanctions.  We will address the question of when 
a sanction of dismissal for spoliation is appropriate under 
Wisconsin law. 
¶39 The 
decision 
to 
impose 
sanctions 
for 
improper 
spoliation of relevant evidence is generally within the trial 
court's discretion.  Milwaukee Constructors II v. Milwaukee 
Metro. Sewerage Dist., 177 Wis. 2d 523, 529, 502 N.W.2d 881 (Ct. 
App. 1993) (reversing the trial court's sanction of dismissal 
because the party's destruction of stored archived documents in 
the course of a cost-cutting initiative did not constitute 
egregious behavior).  There has been some dispute, however, 
regarding when the sanction of dismissal is appropriate. 
¶40 In 1993, the court of appeals examined whether the 
circuit court abused its discretion in dismissing a case after 
concluding that the claimant intentionally destroyed evidence.  
Id.  The court concluded that dismissal was an extreme sanction 
that is only justified in cases of egregious conduct.  Id. at 
533.  It stated that egregious conduct "involves more than 
negligence; rather, it consists of a conscious attempt to affect 
the outcome of the litigation, or a flagrant, knowing disregard 
No. 
2006AP3003   
 
22 
 
of the judicial process."  Id.  The court of appeals ultimately 
concluded that the party's conduct, though volitional and 
negligent, was not a purposeful effort to impair discovery or 
affect the outcome of the litigation.  Id. at 534-35.  Because 
the party's actions were not egregious, the circuit court 
erroneously exercised its discretion when it dismissed the 
party's claims.  Id. 
¶41 In 1995, however, the court of appeals took up a 
similar claim and appeared to allow dismissal without a finding 
of egregious conduct.  Sentry Ins., 196 Wis. 2d at 917-18 
(excluding 
evidence 
as 
a 
sanction 
for 
the 
plaintiff's 
destruction of the refrigerator that was thought to be the cause 
of a house fire).  In 1999, the court of appeals attempted to 
harmonize the seemingly inconsistent rulings, and reaffirmed the 
requirement of egregious conduct as outlined in Milwaukee 
Constructors II.  See Garfoot, 228 Wis. 2d at 723-24. 
¶42 We affirm that dismissal as a sanction for spoliation 
is appropriate only when the party in control of the evidence 
acted egregiously in destroying that evidence.  Milwaukee 
Constructors II, 177 Wis. 2d at 533.  Egregious behavior is "a 
conscious attempt to affect the outcome of the litigation or a 
flagrant, knowing disregard of the judicial process."  Id.  
Lesser 
spoliation 
sanctions, 
such 
as 
pre-trial 
discovery 
sanctions and negative inference instructions, however, may be 
appropriate for spoliation where a party violated its duty to 
preserve relevant evidence, but where the destruction of such 
No. 
2006AP3003   
 
23 
 
evidence did not constitute egregious conduct.  See, e.g., id. 
at 538; Neumann, 242 Wis. 2d 205, ¶80. 
D. 
¶43 In the interests of efficiency and finality, as well 
as to clarify the standards we have established, we now apply 
the facts of the case to determine whether the circuit court 
erroneously exercised its discretion in dismissing American 
Family's case as a sanction for spoliation of evidence.  A 
circuit court properly exercises its discretion when it examines 
the relevant facts, applies a proper standard of law, and uses a 
demonstrably rational process to reach a conclusion that a 
reasonable judge could reach.  Milwaukee Constructors II, 177 
Wis. 2d at 529-30. 
¶44 We 
conclude 
that 
the 
circuit 
court 
applied 
an 
incorrect standard of law in dismissing American Family's claim 
because it did not make a finding of egregiousness before doing 
so.  Moreover, we conclude that American Family's actions were 
not only not egregious, they were reasonable as a matter of law 
and so discharged its duty to preserve the evidence. 
¶45 As outlined above, American Family was required to 
have a legitimate reason to destroy the evidence, and provide: 
(1) reasonable notice of a possible claim; (2) the basis for 
that claim; (3) the existence of evidence relevant to the claim; 
and (4) reasonable opportunity to inspect that evidence.  
Preliminarily, before addressing the sufficiency of the content 
of the notice, we must resolve whether notice was in fact given, 
and this requires us to examine whether Joseph and Charles Golke 
No. 
2006AP3003   
 
24 
 
received the March 13, 2000, letter.  Once this is established, 
we will examine the content of the notice under the above 
factors. 
 
 
1. Did Joseph and Charles Golke Receive the March 13, 2000, 
        Letter? 
¶46 American Family claims that it sent letters on both 
March 13, 2000, and April 6, 2000.  One copy of each letter was 
sent to David Golke, and a second copy of each letter was sent 
to Joseph and Charles Golke at their business address.  David 
Golke admits receiving both letters, and Joseph and Charles 
Golke admit receiving the April 6, 2000, letter.  Joseph and 
Charles Golke, however, do not recall receiving the March 13, 
2000, letter.  As we shall see, the uncontroverted evidence 
demonstrates that, as a matter of law, Joseph and Charles Golke 
did receive the March 13, 2000, letter. 
¶47 American Family's adjuster testified that he wrote the 
March 13, 2000, letter on his computer in his cubicle at 
American Family's office and placed it in his cubicle's outgoing 
mailbox.  The adjuster's assistant was responsible for placing 
the letter in an envelope and placing postage on the envelope.  
On March 13, 2000, American Family's "routine, habit, and 
practice" was for an employee to check the adjuster's cubicle 
every hour during the work day and pick-up any outgoing mail.  
Outgoing mail was given to a mail delivery service at 3:00 p.m. 
or 3:30 p.m. The mail delivery service then delivered the 
No. 
2006AP3003   
 
25 
 
outgoing mail to the post office for delivery of the mail to its 
ultimate destination. 
¶48 Evidence of routine business practice is admissible 
for the purposes of showing that a particular action was in 
conformity with habit or routine practice.  See Wis. Stat. 
§ 904.06; 1A J. Wigmore, Wigmore on Evidence § 95 (Tillers rev. 
1983).  Joseph and Charles Golke provided no evidence that 
American Family's routine mailing practice was not followed or 
was in any way interfered with, prevented, or frustrated with 
regard to the March 13, 2000, letter.  Joseph and Charles Golke 
also conceded that the business address listed in the letter's 
heading was their address at the time, and that they met with 
American Family's investigator at that address shortly before 
the letter was sent.  Therefore, the unrebutted evidence is that 
American Family sent the March 13, 2000, letter to Joseph and 
Charles Golke in a properly addressed and postage-prepaid 
envelope.16 
¶49 These facts are sufficient to raise a rebuttable 
presumption that the March 13, 2000, letter was not only sent, 
but was received by Joseph and Charles Golke.  State ex rel. 
Flores, 183 Wis. 2d at 613.  The presumption is strengthened by 
the fact that Joseph and Charles Golke concede receiving other 
mail from American Family at the address to which the March 13, 
                                                 
16 This court has long held that implicit in testimony that 
a letter was mailed is the fact that "the letter was inclosed 
(sic) in an envelope, properly addressed, [and] deposited in the 
postoffice (sic) with the postage duly prepaid."  Reeves, 170 
Wis. at 376. 
No. 
2006AP3003   
 
26 
 
2000, letter was sent, namely, the April 6, 2000, letter.  See 
31A C.J.S. Evidence § 235 ("[T]he presumption may arise where a 
party admits to receiving another notice mailed to the same 
address.").  The presumption is further strengthened by the fact 
that American Family's adjuster prepared an identical letter to 
David Golke on the same day using the same routine mailing 
practice for that letter as for the letter sent to Joseph and 
Charles Golke, and David Golke concedes that he received the 
copy of the March 13, 2000, letter sent to him. See Id. 
(explaining that when a letter is sent to each of two neighbors, 
and the first neighbor received the letter, a presumption arises 
that the second neighbor also received the letter).17 
¶50 This presumption of receipt can only be rebutted by 
credible evidence of non-receipt, usually in the form of a 
denial that the letter was received.  See State ex rel. Flores, 
183 Wis. 2d at 613.  Neither Joseph nor Charles Golke denied 
that they received the March 13, 2000, letter, however.  Rather, 
they concede that they may have received the letter, but cannot 
recall one way or the other.  Non-remembrance, though, does not 
constitute denial, and does not rebut the presumption of 
receipt.  Id. 
                                                 
17 David Golke was not a neighbor of his brothers' business, 
but the principle that the receipt by one addressee of a letter 
sent simultaneously by the same sender of an identical letter to 
a second addressee strengthens the presumption that the second 
addressee also received the letter and that routine practice was 
followed. 
No. 
2006AP3003   
 
27 
 
¶51 Joseph and Charles Golke argue that the letter should 
not be presumed received because they allegedly had some 
difficulties receiving mail at their business, there is no 
affidavit of mailing, and the letter was sent via first-class 
rather than certified mail.  None of these constitute a denial 
or credible evidence of non-receipt, and are therefore not 
enough to overcome the presumption of receipt.  We therefore 
apply the law to the unrebutted facts and presume that Joseph 
and Charles Golke received American Family's letter dated March 
13, 2000.  Because notice was provided, we must examine whether 
the notice was sufficient to discharge American Family's duty to 
preserve the evidence. 
 
2. Did American Family Discharge Its Duty to Preserve the  
   Fire Scene Evidence? 
¶52 In order to discharge its duty to preserve the 
evidence from the fire scene, American Family was required to 
have a legitimate reason to destroy evidence, and provide: (1) 
reasonable notice of a possible claim; (2) the basis for that 
claim; (3) the existence of evidence relevant to the claim; and 
(4) reasonable opportunity to inspect that evidence. 
¶53 The March 13, 2000, letter, which David and (as we 
concluded above) Joseph and Charles Golke received, informed the 
Golkes that a fire occurred at a specific home on a specific 
date, and that the Golke brothers' negligent work at that home 
was believed to be the cause of the fire.  The letter instructed 
the Golkes to forward the letter to their insurers, and advised 
No. 
2006AP3003   
 
28 
 
that American Family expected either the Golkes or their 
insurers, 
if 
applicable, to pay for the repairs to or 
replacement of the home.  The letter concluded by offering the 
Golkes or their insurers an opportunity to conduct "a proper 
investigation" of the fire scene.  It stated that destruction of 
the fire damaged building would be delayed until April 1, 2000, 
to allow for this inspection. 
¶54 The April 6, 2000, letter to the Golkes stated that it 
was the second notice regarding the Golkes' liability for the 
fire damage at a specifically identified house.  It also 
instructed the Golkes to quickly have their insurers contact 
American Family so that the Golkes would have coverage available 
to pay for the losses for which American Family was holding them 
liable. 
¶55 American Family also had additional correspondence 
with David Golke, who responded to the March 13, 2000, letter.  
American Family sent David Golke and Indiana Insurance a letter 
on March 23, 2000, that, among other things, recommended an 
investigation 
of 
the 
fire 
scene 
because 
of 
the 
planned 
demolition on April 1, 2000. 
¶56 Both the March 13 and April 6 letters provided 
reasonable notice of a possible claim and the basis for that 
claim.  American Family expected the Golkes or their insurer to 
pay for the damages arising from their allegedly negligent work 
performed on a specific house, which allegedly caused a fire on 
a specific date at that house.  The March 13, 2000, letter to 
both, and the March 23, 2000, letter to David Golke, explicitly 
No. 
2006AP3003   
 
29 
 
noted the existence of relevant evidence, and provided ample 
time for the Golkes to inspect or schedule an inspection of the 
evidence before its destruction.  The April 1, 2000, deadline 
was in fact extended by at least ten days before demolition and 
rebuilding 
commenced, 
and 
according 
to 
American 
Family, 
"definitely" would have been extended upon request.18 
¶57 We note that American Family did not own the home in 
question here.  The family that did own the home should not be 
expected to wait indefinitely for the Golkes to inspect the 
home, particularly when the Golkes made no efforts to inspect or 
test the fire scene when presented with the opportunity to do 
so.  American Family was placed in a difficult spot because of 
                                                 
18 The concurrence argues that the Golkes were not given a 
reasonable amount of time to inspect the evidence.  See 
Concurrence, ¶73.  But the concurrence ignores the unrebutted 
testimony that this deadline would have been extended upon 
request.  Moreover, the concurrence forgets that, had Joseph and 
Charles Golke responded, their insurer surely could have 
arranged an inspection within the relevant timeframe.  As for 
David Golke, his insurer initially denied coverage.  This put 
the responsibility on David Golke to protect his rights, which 
he did not do.  In short, the Golkes simply ignored American 
Family's communications.  Contra the concurrence, they did have 
sufficient time to either inspect or schedule an inspection of 
the evidence. 
No. 
2006AP3003   
 
30 
 
the Golkes' unresponsiveness, and it had a legitimate reason to 
destroy the home19 and acted reasonably under the circumstances. 
¶58 Under the facts of this case, we conclude that 
American Family's March 13, 2000, letter, March 23, 2000, letter 
to David Golke and his insurer, and to a lesser degree the 
letter sent on April 6, 2000, provided sufficient notice and an 
opportunity to inspect the relevant evidence so as to discharge 
its duty to preserve the evidence.  We therefore conclude that 
American Family's actions were reasonable, and therefore no 
sanctions for spoliation were appropriate as a matter of law.  
Thus, the circuit court erroneously exercised its discretion in 
sanctioning American Family for spoliation. 
V. 
CONCLUSION 
¶59 We conclude that the duty to preserve relevant 
evidence is discharged when a party or potential litigant with a 
legitimate reason to destroy evidence provides reasonable notice 
of a possible claim, the basis for that claim, the existence of 
evidence relevant to the claim, and a reasonable opportunity to 
inspect that evidence.  We further hold that such notice can be 
                                                 
19 The concurrence makes it seem as though if American 
Family had only preserved certain parts of the home——the chimney 
assembly, fireplace, doghouse (a part of the roof), roof decking 
and joints, and part of the interior chase——all parties would 
have been satisfied.  See Concurrence, ¶63.  It is not clear 
why, however, just these specific parts would have been enough 
for the Golkes.  This situation illustrates why a party may 
discharge its duty to preserve evidence.  When a legitimate 
reason to destroy evidence exists, as here with the home, 
parties have an obligation to protect their rights when put on 
notice.  The Golkes failed to do that here.   
No. 
2006AP3003   
 
31 
 
properly effectuated by mailing a letter via first-class mail.  
We also affirm that dismissal is an appropriate sanction for 
spoliation of evidence only if a party acts egregiously——that 
is, in a conscious effort to affect the outcome of litigation or 
in 
flagrant, 
knowing 
disregard 
of 
the 
judicial 
process.  
Applying the law to the facts of this case, we conclude that as 
a matter of law, Joseph and Charles Golke received the March 13, 
2000, letter, and that American Family provided the Golkes with 
reasonable and sufficient notice, thereby discharging its duty 
to preserve the evidence from the fire.  The circuit court 
therefore erroneously exercised its discretion when it dismissed 
American Family's suit.  Because American Family discharged its 
duty to preserve evidence and no sanctions are appropriate, the 
judgment of the circuit court is reversed, and the cause is 
remanded to the circuit court for trial on the merits. 
By the Court.—The judgments of the circuit court are 
reversed, and the cause is remanded to the circuit court for 
further proceedings consistent with this opinion. 
 
No. 
2006AP3003.ssa   
 
1 
¶60 SHIRLEY 
S. 
ABRAHAMSON, 
C.J.   (concurring). 
 
The 
majority opinion concludes that American Family's actions in 
razing the fire-damaged house "were reasonable as a matter of 
law and so discharged [American Family's] duty to preserve 
evidence,"1 such that no sanction is appropriate.  Not so!   
¶61 The record supports the circuit court's findings of 
fact 
and 
discretionary determination that American Family 
violated its duty to preserve evidence and may be sanctioned.  
Because American Family's conduct was not egregious, that is, 
because the conduct was not a conscious attempt to affect the 
outcome of the litigation or a flagrant knowing disregard of the 
judicial process, the circuit court erred in imposing the 
sanction of dismissing American Family's claim.  But on its 
findings of fact and this record the circuit court could have 
imposed another sanction.  I would remand to determine whether 
any 
sanction 
other 
than 
the 
sanction 
of 
dismissal 
is 
appropriate.2 
¶62 American Family's theory in the circuit court was that 
the Golkes, when doing work on the house's roof, negligently 
moved the chimney too close to combustible materials on the 
roof, which eventually caught fire.  American Family, however, 
did not save any of the physical evidence relevant to its theory 
                                                 
1 Majority op., ¶44.  See also majority op., ¶¶5, 58-59. 
2 The circuit court held a bench trial relating to the 
Golkes' insurance coverage and to American Family's destruction 
of evidence.  It did not rule on the coverage issue.  I assume 
the majority opinion's remand is for further proceedings related 
to coverage and to the merits of American Family's claim against 
the Golkes.   
No. 
2006AP3003.ssa   
 
2 
about the cause and origin of the fire and to its theory that 
the Golkes (as opposed to the original home builder) were 
responsible for creating a dangerous condition on the roof. 
¶63 The circuit court found as a matter of fact that 
important parts of the fire scene "could [have] been easily 
preserved, could have been removed and could [have] been 
available for inspection and testing."  The circuit court 
accepted the defense expert's testimony that American Family 
should have saved the chimney assembly, the fireplace, the 
"doghouse" (a part of the roof), roof decking and joists, and 
part of the interior chase, all of which would have fit easily 
in a garage stall.  The circuit court also accepted the 
testimony of American Family's fire scene investigator, who 
testified that he could have preserved critical parts of the 
roof in a 10x10 foot area,3 that he felt photographs were 
sufficient to document his findings about the cause and origin 
of the fire, and that he more than likely would handle the fire 
scene investigation differently if he were to conduct it today.  
¶64 The circuit court found American Family's photographs 
inadequate.  It accepted the defense expert's testimony that the 
photographs did not permit an inference as to where the fire 
originated because the photographs were all of very small areas 
on or in the house, with no "medium view or overall view 
                                                 
3 Another 
American 
Family 
expert 
testified 
through 
a 
deposition that removal and preservation of physical evidence 
was not feasible and that the only way to preserve evidence of 
the fire scene was through photography.  The circuit court did 
not find this testimony persuasive. 
No. 
2006AP3003.ssa   
 
3 
photographs of those same areas to place them in relation to the 
fire scene in general."  
¶65 The circuit court also determined, after conducting a 
bench hearing with all evidence presented, that American 
Family's 
failure 
to 
preserve 
evidence 
caused 
significant 
prejudice to the Golkes.  The circuit court concluded that 
American Family had "destroyed what is the crucial evidence that 
is important for the defendants to be able to evaluate the claim 
and to prepare and present a defense."  The circuit court 
accepted the defense expert's testimony that due to the complete 
destruction of physical evidence, he could not form opinions 
about either the cause or the origin of the fire. 
¶66 Having reviewed the evidence and made its findings, 
the circuit court ultimately determined that American Family's 
failure to preserve crucial evidence from the fire scene "is a 
clear case of spoliation every bit as bad" as the conduct that 
has warranted sanctions in other cases.  The circuit court's 
determination that American Family violated its duty to preserve 
relevant evidence clearly was reasonable and is supported by the 
circuit court's findings of fact and evidence in the record. 
¶67 The majority opinion properly acknowledges that "the 
ability of the party in possession of the evidence to bear the 
burden and expense of preserving it" is a relevant factor in the 
spoliation analysis.4  Nevertheless, the majority opinion ignores 
the circuit court's finding of fact that American Family could 
have preserved crucial evidence from the fire scene with minimal 
burden or expense. 
                                                 
4 Majority op., ¶29. 
No. 
2006AP3003.ssa   
 
4 
¶68 The majority opinion also acknowledges that a party or 
potential litigant requires "a legitimate reason to destroy 
evidence."5 The majority opinion does not explain——because it 
cannot explain——what legitimate reason American Family had for 
destroying every piece of evidence from the fire scene in the 
present case. 
¶69 In short, the majority opinion turns a blind eye to 
the 
circuit 
court's 
findings 
of 
fact 
and 
discretionary 
determination that American Family acted unreasonably in failing 
to preserve any part of the fire scene, including the parts of 
the house that American Family's expert knew or should have 
known to be highly relevant to American Family's claim against 
the Golkes and to the Golkes' defense.  
¶70 This 
court 
should 
uphold 
the 
circuit 
court's 
discretionary decision to sanction American Family for failing 
to act reasonably in preserving evidence.   
¶71 Although dismissal is not the appropriate sanction in 
the present case, the circuit court nevertheless may impose a 
lesser sanction for American Family's failure to preserve any 
part of the house.  A circuit court has "a broad canvas upon 
which to paint in determining what sanctions are necessary" in a 
spoliation case.6  Courts have excluded evidence,7 imposed a 
                                                 
5 Majority op., ¶5. 
6 Milwaukee Constructors II v. Milwaukee Metro. Sewerage 
Dist., 177 Wis. 2d 523, 538, 502 N.W.2d 881 (Ct. App. 1993). 
7 See Estate of Neumann v. Neumann, 2001 WI App 61, ¶80, 242 
Wis. 2d 205, 626 N.W.2d 821 (stating that the Wisconsin courts 
recognize the exclusion of evidence as a sanction in spoliation 
cases). 
No. 
2006AP3003.ssa   
 
5 
monetary sanction,8 or allowed "the trier of fact . . . to draw 
an inference from the intentional spoliation of evidence that 
the destroyed evidence would have been unfavorable to the party 
that destroyed it."9   
                                                                                                                                                             
See also Howell v. Maytag, 168 F.R.D. 502, 505 (M.D. Pa. 
1996) 
("Where 
evidence 
is 
destroyed, 
sanctions 
may 
be 
appropriate, including . . . the exclusion of countervailing 
evidence . . . ."); N. Assurance Co. v. Ware, 145 F.R.D. 281, 
284 (D. Me. 1993) (excluding evidence as a sanction for the 
spoliation of evidence); Hamilton Mut. Ins. Co. v. Ford Motor 
Co., 702 N.E.2d 491, 493 (Ohio Ct. App. 1997) ("In product 
liability cases where evidence is intentionally or negligently 
'spoiled' or destroyed by a plaintiff or his expert before the 
defense has an opportunity to examine that evidence for alleged 
defects, a court may preclude any and all expert testimony as a 
sanction for the spoliation of evidence." (quotation marks and 
citation omitted)). 
8 See, e.g., Turner v. Hudson Transit Lines, Inc., 142 
F.R.D. 68, 77-78 (S.D.N.Y. 1991) (stating that "courts impose 
monetary sanctions for the destruction of evidence"; imposing a 
monetary sanction); Harkins Amusement Enters., Inc. v. Gen. 
Cinema Corp., 132 F.R.D. 523, 524 (D. Ariz. 1990) (imposing a 
monetary sanction for the destruction of evidence); Capellupo v. 
FMC Corp., 126 F.R.D. 545, 553 (D. Minn. 1989) (same). 
9 Neumann, 242 Wis. 2d 205, ¶81 (citation omitted). 
See also Schmid v. Milwaukee Elec. Tool Corp., 13 F.3d 76, 
78 (3d Cir. 1994) ("Since the early 17th century, courts have 
admitted evidence tending to show that a party destroyed 
evidence relevant to the dispute being litigated.  Such evidence 
permitted an inference, the 'spoliation inference,' that the 
destroyed evidence would have been unfavorable to the position 
of the offending party." (citation omitted)). 
In Nation-Wide Check Corp. v. Forest Hills Distributors, 
Inc., 692 F.2d 214, 218 (1st Cir. 1982), then-Judge Breyer (now 
Justice 
Breyer) 
explained 
the 
rationale 
underlying 
the 
"spoliation inference" as follows: 
The adverse inference is based on two rationales, one 
evidentiary and one not.  The evidentiary rationale is 
nothing more than the common sense observation that a 
party who has notice that a document is relevant to 
litigation and who proceeds to destroy the document is 
No. 
2006AP3003.ssa   
 
6 
 
¶72 The majority opinion does a disservice to the parties 
and to the law by ignoring American Family's failure to retain 
any part of the house as evidence.  This is the main defect in 
the decision.  Other parts of the majority opinion, however, 
deserve closer attention as well.   
¶73 First, contrary to the majority opinion's holding at 
¶58, a reasonable judge could conclude that American Family did 
not give the Golkes a reasonable opportunity to inspect the 
evidence in the present case before it was destroyed.  American 
Family's March 13, 2000, letter to the Golkes stated that the 
house would be demolished on April 1, 2000——just 19 days after 
the letter was written.10  The letter did not suggest that the 
April 1 deadline was flexible, although American Family's claims 
adjustor testified after the fact that he would have granted an 
extension upon request.  During the 19 days between March 13 and 
April 1, the Golkes needed to contact and work things out with 
their insurers, to find and retain a fire scene investigator, 
                                                                                                                                                             
more likely to have been threatened by the document 
than is a party in the same position who does not 
destroy the document. . . .  The other rationale for 
the inference has to do with its prophylactic and 
punitive effects.  Allowing the trier of fact to draw 
the 
inference 
presumably 
deters 
parties 
from 
destroying 
relevant 
evidence 
before 
it 
can 
be 
introduced at trial.  The inference also serves as a 
penalty, placing the risk of an erroneous judgment on 
the party that wrongfully created the risk. 
10 Majority op., ¶9. 
No. 
2006AP3003.ssa   
 
7 
and to make arrangements for the investigation.  A lot to expect 
from the owners of a local roofing outfit!11 
 
¶74 Moreover, American Family ended up giving David Golke 
as few as nine days to retain a fire scene investigator and 
conduct the investigation.  Upon receiving American Family's 
March 13 letter, David Golke did exactly what the letter told 
him to do: He promptly forwarded the letter to his insurance 
carrier.12  David Golke did not know that he, rather than his 
insurance carrier, would be responsible for dealing with 
American Family until he received a second letter from American 
Family, dated March 23, 2000, informing him that his insurance 
carrier had denied coverage.  The March 23 letter reiterated 
that the house would be demolished on April 1, 2000.  
¶75 The majority opinion apparently concludes that as a 
matter of law it is reasonable to give a small businessman nine 
days to locate and hire an expert witness before losing the 
opportunity to inspect evidence that is critically relevant to a 
potential lawsuit against him.  See majority op., ¶56 (stating 
that the March 23 letter to David Golke "provided ample 
time . . . to inspect or schedule an inspection of the evidence 
before its destruction").  I do not find the majority opinion 
persuasive on this point. 
                                                 
11 The majority opinion identifies the "sophistication of 
the parties" as a relevant factor in the spoliation analysis.  
Majority op., ¶29.   
12 The March 13 letter stated in relevant part: "If you have 
a liability insurance carrier, please forward this letter to 
them and we will handle these matters directly with them." 
No. 
2006AP3003.ssa   
 
8 
¶76 Perhaps sensing that a reasonable judge could take 
issue with American Family's narrow timetable, the majority 
opinion hedges its bets by declaring that the Golkes had an 
extra 10 days to inspect the fire scene because demolition of 
the house "did not begin until sometime after April 11, 2000."13  
The majority opinion, however, decides an issue of fact that the 
circuit court left undecided.  The circuit court stated that it 
"never heard testimony or official evidence as to the razed 
date" and "[did not] know what date the home was actually 
razed."14 
¶77 Even 
assuming 
that 
American 
Family 
waited 
an 
additional ten days to demolish the house, this delay would not 
show that American Family's conduct was reasonable as a matter 
of law.  American Family never told the Golkes that they had an 
extended period of time during which to inspect the fire scene.  
A letter that American Family sent to the Golkes on April 6, 
                                                 
13 Majority op., ¶15.   
See also majority op., ¶56 ("The April 1, 2000, deadline 
was in fact extended by at least ten days before demolition and 
rebuilding commenced . . . ."). 
14 American Family's claims adjustor testified that although 
he could not recall when the fire scene was demolished, he could 
infer from two documents in the record that demolition began no 
earlier than April 11, 2000.  American Family introduced two 
internal reports indicating that as of April 11, 2000, American 
Family still had not contracted for the rebuilding of its 
insured's home.  The claims adjustor stated in his testimony 
that he thought "[American Family] would not have given the okay 
to start the demolition without knowledge of the——what we were 
going to be paying out for the rebuilding process."   
The circuit court neither accepted nor rejected the claims 
adjustor's testimony about his inference from the internal 
reports.   
No. 
2006AP3003.ssa   
 
9 
2000, requested insurance information and neither stated nor 
implied that the fire scene was still intact or that the Golkes 
might still have an opportunity to inspect it.15  American Family 
also failed to provide this information after Charles Golke 
called American Family on April 7 and left a message in reply to 
the April 6 letter.  American Family's claims adjustor testified 
that he returned Charles Golke's call after business hours, got 
no answer, and then made no further attempt to contact any of 
the Golkes until October 2000. 
 
¶78 Second, the majority opinion fails to make clear that 
the method of notifying interested persons of the impending 
destruction of evidence depends on the circumstances of the 
case.  In some circumstances first-class mail might be fine.  In 
others, not. 
¶79 Although the majority opinion relies upon statutes 
permitting notice to be made via first-class mail to justify the 
use of first-class mail in the present case,16 the legislature 
does not always deem first-class mail an appropriate method of 
providing notice.  Indeed, a computer search of the Wisconsin 
Statutes reveals that the phrase "certified mail" appears in 167 
sections of the statutes, the phrase "registered mail" appears 
in 104 sections of the statutes, and the phrase "first-class 
mail" appears in only 18 sections.17   
                                                 
15 See majority op., ¶12. 
16 Majority op., ¶33.   
17 The text of the Wisconsin Statutes is searchable at 
http://nxt.legis.state.wi.us/nxt/gateway.dll?f=templates&fn=stat
s.htm (last visited June 30, 2009). 
No. 
2006AP3003.ssa   
 
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¶80 I am uncomfortable with any language in the majority 
opinion intimating that first-class mail is sufficient in all 
cases. 
¶81 In any event I suggest it is wiser for a person who 
must give notice to use a method that provides written evidence 
that he or she actually did give the notice and that the 
recipient actually did receive the notice.  Without such written 
proof a dispute may arise about notice, and the notifier, the 
recipient, and the courts will be faced with a set of 
presumptions that evolved in a different era and might not be 
realistic in the technologically-advanced 21st century. 
¶82 In sum, I would remand the matter to the circuit court 
to exercise its discretion in determining whether a sanction 
lesser than the sanction of dismissal should be imposed for 
American Family's failure to retain any physical evidence from 
the fire scene in the present case.   
 
¶83 For the reasons set forth, I write separately.   
¶84 I am authorized to state that Justice ANN WALSH 
BRADLEY joins this opinion.