Title: Delores Sawyer v. Berit H. Midelfort, M.D.
Citation: N/A
Docket Number: 1997AP001969
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: June 29, 1999

SUPREME COURT OF WISCONSIN 
 
 
Case No.: 
97-1969 
 
 
Complete Title 
of Case: 
 
 
Delores Sawyer, special administrator of the 
estate of Nancy K. Anneatra, Thomas Sawyer and 
Delores Sawyer,  
 
Plaintiff-Appellant, 
 
v. 
H. Berit Midelfort, M.D. and Celia  
Lausted,  
 
Defendants-Respondents-Petitioners, 
ABC Insurance Company and DEF Insurance Company,  
 
Defendants.  
 
ON REVIEW OF A DECISION OF THE COURT OF APPEALS 
Reported at:  217 Wis. 2d 795, 579 N.W.2d 268 
 
 
 
(Ct. App. 1998, Published) 
 
 
Opinion Filed: 
June 29, 1999 
Submitted on Briefs: 
 
Oral Argument: 
December 2, 1998 
 
 
Source of APPEAL 
 
COURT: 
Circuit 
 
COUNTY: 
Eau Claire 
 
JUDGE: 
Eric J. Wahl 
 
 
JUSTICES: 
 
Concurred: 
Wilcox, J., concurs (opinion filed) 
 
Dissented: 
Bradley, J, dissents (opinion filed) 
 
Not Participating: Abrahamson, C.J., did not participate.  
 
 
ATTORNEYS: 
For the defendants-respondents-petitioners there 
were briefs by Kay Nord Hunt, Thomas R. Jacobson, Brent R. 
Johnson and Lommen, Nelson, Cole & Stageberg, P.A., Hudson; 
Thomas J. Misfeldt, James W. Flory and Misfeldt, Stark, Richie & 
Wickstrom, Eau Claire and oral argument by Kary Nord Hunt. 
 
 
For the plaintiffs-appellants there was a brief 
by William Smoler, Gregory P. Seibold and Murphy & Desmond, S.C., 
Madison and oral argument by William Smoler & Gregory P. Seibold. 
 
 
Amicus curiae was filed by Mark L. Adams and 
State Medical Society of Wisconsin and Jeffrey J. Kassel, David 
E. McFarland and Lafollette & Sinykin, all of Madison for the 
State Medical Society of Wisconsin. 
 
 
Amicus curiae was filed by David D. Relles and 
Relles, Meeker & Borns, Madison; Thomas A. Pavlinic, Annapolis, 
MD for The False memory Syndrome Foundation.  
 
 
 
No. 
97-1969 
 
1 
 
NOTICE 
This opinion is subject to further editing and 
modification.  The final version will appear in 
the bound volume of the official reports. 
 
 
No. 97-1969 
 
STATE OF WISCONSIN               :        
        
 
 
 
 
IN SUPREME COURT 
 
 
Delores Sawyer, special administrator of  
the estate of Nancy K. Anneatra, Thomas  
Sawyer and Delores Sawyer,  
 
          Plaintiffs-Appellants, 
 
     v. 
 
H. Berit Midelfort, M.D. and Celia  
Lausted,  
 
          Defendants-Respondents- 
          Petitioners, 
 
ABC Insurance Company and DEF Insurance  
Company,  
 
          Defendants.  
FILED 
 
JUN 29, 1999 
 
Marilyn L. Graves 
Clerk of Supreme Court 
Madison, WI 
 
 
 
 
REVIEW of a decision of the Court of Appeals.   Affirmed. 
¶1 
DONALD W. STEINMETZ, J.  The petitioners seek review 
of a published decision of the court of appeals, Sawyer v. 
Midelfort, 217 Wis. 2d 795, 579 N.W.2d 268 (Ct. App. 1998), 
which affirmed in part and reversed in part a judgment of the 
Circuit Court for Eau Claire County, the Honorable Eric J. Wahl. 
 The circuit court granted summary judgment ordering the 
dismissal of the plaintiffs’ professional negligence claims 
against the defendants Dr. H. Berit Midelfort (Midelfort) and 
Celia Lausted (Lausted) and their negligent infliction of 
emotional distress claim against Lausted.  The circuit court 
No. 
97-1969 
 
2 
concluded that the professional negligence claims brought by 
Delores and Thomas Sawyer (the Sawyers) failed to state claims 
upon which relief could be granted, and, in the alternative, 
were barred by the statute of limitations.1  The circuit court 
also concluded that the claim brought by Nancy Anneatra's Estate 
(the Estate) was barred on grounds of public policy.  The court 
of appeals reversed as to each of these rulings.2 
¶2 
The following issues are presented for our review:   
¶3 
(1) May the parents of an adult child maintain third-
party professional negligence actions wherein they allege that 
the defendants’ negligent therapy and psychiatric care resulted 
in the implanting and reinforcing of false memories of sexual 
abuse in their child? 
¶4 
(2) Where a patient has not sustained physical injury, 
do claims of professional negligence on behalf of the patient's 
estate for "pain, suffering and disability, medical, psychiatric 
and psychological expense and loss of enjoyment of life," 
survive under Wis. Stat. § 895.01 and/or are such claims 
otherwise barred on public policy grounds? 
                     
1 Although the circuit court did not specifically address 
the Sawyers’ negligent infliction of emotional distress claim 
against Lausted, we understand the court’s dismissal of the 
Sawyers’ claims on the grounds that they were barred by the 
statute of limitations to apply equally to all the Sawyers’ 
claims. 
2 Midelfort also asserted as a defense that Minnesota law 
applied to the claims against her.  The circuit court ruled that 
Wisconsin law governed the claims against Midelfort.  The court 
of appeals affirmed.  This issue was not argued or briefed in 
this court, and we consider the issue waived. 
No. 
97-1969 
 
3 
¶5 
(3) Does Wisconsin's discovery rule extend the statute 
of limitations for the Sawyers' claim for negligent infliction 
of emotional distress sustained as a result of a meeting that 
took place in 1985? 
¶6 
(4) Does the doctrine of laches bar claims that the 
defendants engaged in negligent therapy and psychiatric care 
resulting in the implanting of false memories of sexual abuse in 
a patient where the patient’s parents and the adult patient's 
Estate brought the claims after the patient's death? 
Background 
¶7 
Nancy Anneatra (Anneatra), the woman who is at the 
center of this lawsuit but is now dead, was born in 1958 to 
Delores and Thomas Sawyer.  From the record we discover that 
from quite a young age, Anneatra suffered a variety of 
psychiatric problems, including anxiety, panic attacks, and 
severe depression, and that on at least one occasion prior to 
meeting either of the defendants in this action, she required 
psychiatric hospitalization.   
¶8 
As this case comes before us on the motion for summary 
judgment and prior to the completion of discovery, it is unclear 
at this time when Anneatra began having memories of being 
sexually abused by her father, whether she always had such 
memories, or whether her first memories were repressed and 
brought forward only a short time before she met Lausted.  What 
is clear is that Anneatra first met Lausted at a women's shelter 
in Eau Claire, Wisconsin, in late 1983.  As evidenced by a diary 
entry in the autumn of 1983, when she met Lausted, Anneatra had 
No. 
97-1969 
 
4 
already had some memory of being sexually abused by her father, 
the plaintiff Thomas Sawyer.  And although the record does not 
disclose when Anneatra began to receive mental health treatment 
regarding her memories of sexual abuse, the parties agree that 
prior to receiving such treatment from Lausted in June 1984, she 
had 
been 
receiving 
mental 
health 
treatment 
from 
others, 
including Dr. Kathryn Bemmann, who is not a defendant in this 
case. 
¶9 
In June 1984, Lausted, who at the time was an 
unlicensed therapist, began to treat Anneatra.  In July 1985, 
the Sawyers first learned that Anneatra believed that she had 
been sexually abused by her father when, together with Dr. 
Bemmann and Lausted, Anneatra confronted her parents in Dr. 
Bemmann's office.  It was at this meeting that Anneatra accused 
both of physically abusing her during her childhood, and accused 
her father of sexually abusing her.  The Sawyers deny that any 
abuse occurred. 
¶10 Shortly 
after 
this 
confrontation, 
Anneatra 
discontinued all contacts with her parents and changed her name 
from Sawyer to Anneatra to make it more difficult for her 
parents to find her.  Anneatra maintained a post office box 
through which her parents could, and did on occasion, reach her, 
but apparently neither Anneatra nor the Sawyers contacted the 
other directly during the next ten years.  Anneatra’s sister 
served as a conduit through which the Sawyers from time to time 
would obtain information about Anneatra. 
No. 
97-1969 
 
5 
¶11 In 1988, Anneatra filed a lawsuit in Minnesota against 
her parents seeking civil damages for harm caused by their 
abuse.  Her complaint included allegations that as a result of 
the sexual abuse she suffered at the hands of her father, she 
had to undergo an abortion at age 13 and that her mother had 
arranged for the abortion.  The complaint also indicated that 
Anneatra had repressed her memory of the abuse until October 
1983, when she became aware of the abuse as a result of 
counseling and treatment.  It appears that neither party to this 
lawsuit is certain how far the Minnesota lawsuit progressed, 
although they agree that it was dismissed before serious efforts 
toward discovery were made. 
¶12 Anneatra continued to receive therapy from Lausted 
throughout her life.  After Dr. Bemmann terminated her treatment 
of Anneatra in 1987, Lausted referred Anneatra to the defendant, 
Midelfort, a psychiatrist, who participated in Anneatra's care 
through December of 1994.  Midelfort treated Anneatra more than 
50 times during this period, administering and monitoring 
Anneatra’s medications, providing psychiatric evaluations, and 
offering Anneatra support for the purpose of maintaining her 
psychiatric stability.  During the course of her treatment with 
Midelfort, Anneatra told Midelfort that she was sexually abused 
by her father, paternal grandfather, uncle, brother and two 
priests.  She also told Midelfort that an aunt and cousins were 
also involved, either as sexual perpetrators themselves or as 
observers of the sexual perpetration of others.  
No. 
97-1969 
 
6 
¶13 Anneatra died of cancer in early 1995 and the Sawyers 
did not learn of her death until perhaps six months thereafter. 
 Following the discovery of her daughter’s death, Dolores Sawyer 
successfully obtained an 
order appointing 
herself special 
administrator of Anneatra's estate.  As administrator of the 
estate, Dolores Sawyer was successful in gaining access to her 
daughter’s medical records.    
¶14 Subsequently, the instant lawsuit was filed by Delores 
and Thomas Sawyer in their individual capacities, and Delores 
Sawyer as special administrator of Anneatra’s estate.  In their 
complaint, the Sawyers allege that Anneatra developed false 
memories of sexual and physical abuse by her father, and 
physical abuse by her mother, as a result of Lausted’s and 
Midelfort’s 
negligent 
treatment. 
 
They 
claim 
that 
the 
defendants’ negligence caused them "past and future pain, 
suffering and loss of enjoyment of life." 
¶15 Specifically, as to their professional negligence 
claim against Lausted, the Sawyers allege that she failed to 
properly diagnose and treat Anneatra's problems, misdirected 
Anneatra's therapy to recover false memories of sexual abuse 
through the negligent performance of hypnosis and by failing to 
recognize problems created by such hypnosis, negligently handled 
the transference and countertransference phenomenon existing in 
the therapeutic relationship, implanted and reinforced false 
memories in Anneatra, and failed to recognize that the memories 
which were being created in Anneatra were false memories. 
No. 
97-1969 
 
7 
¶16 The Sawyers' allegations against Dr. Midelfort include 
the same acts of negligence as alleged against Lausted, with the 
exception of the claim of negligent handling of the transference 
and countertransference phenomenon, and with the additional 
allegation that Midelfort failed to properly supervise Lausted's 
treatment of Anneatra. 
¶17 In a separate claim, the Sawyers allege that Lausted's 
negligence 
caused 
them 
emotional 
distress, 
their injuries  
arising from the 1985 meeting at which Anneatra made her 
accusations.   
¶18 The Estate’s claim alleges that Anneatra sustained 
personal injuries and seeks damages for "pain, suffering, and 
disability; medical, psychiatric and psychological expenses; and 
loss of enjoyment of life" as a result of Lausted’s and 
Midelfort's failure to properly diagnose her psychological 
problems and their negligent treatment of those problems. 
¶19 The defendants filed motions for summary judgment, 
arguing that the plaintiffs’ third-party professional negligence 
actions failed to state claims upon which relief could be 
granted, and were otherwise barred from bringing their claims 
due to the doctrine of laches and the statute of limitations.  
Lausted asserted that the Sawyers’ claim of negligent infliction 
of emotional distress was barred by the statute of limitations 
and 
the 
doctrine 
of 
laches. 
 
For 
her 
part, 
Midelfort 
additionally argued that with respect to the claims in which she 
was named, choice of law principles required that Minnesota law 
be applied and, additionally, that Minnesota law precluded her 
No. 
97-1969 
 
8 
from being a defendant.  After conducting a hearing, the circuit 
court issued a lengthy decision granting summary judgment in 
favor of the defendants on all but the choice of law question 
and dismissed the plaintiffs’ complaint in its entirety. 
¶20 The circuit court first concluded that the Sawyers' 
third-party professional negligence claims against Midelfort and 
Lausted failed to state claims upon which relief could be 
granted.  It considered their claims against both Midelfort and 
Lausted to be "essentially one[s] of 'interference of filial 
relationship' 
which 
in 
Wisconsin 
would 
be 
specifically 
prohibited under Wells Estate v. Mt. Sinai Medical Center, 183 
Wis. 2d 667, 515 N.W.2d 705 (1994)."  Anticipating that its 
decision would be appealed, the circuit court also addressed the 
defendants' arguments that the Sawyers' claims were barred by 
the statute of limitations and found that they were. 
¶21 The circuit court did not discuss the defendants' 
doctrine of laches defense.  Nor did the circuit court 
specifically refer to the Sawyers' negligent infliction of 
emotional distress claim against Lausted, although we read its 
discussion of the statute of limitations on which grounds it 
dismissed 
the 
Sawyers’ 
professional 
negligence 
claims 
as 
implicitly including their claim of negligent infliction of 
emotional distress. 
¶22 The circuit court also dismissed the Estate's claim 
against Lausted and Midelfort, treating portions of the Estate’s 
allegations separately.  The court first concluded that the 
Estate's claims for damages arising from “loss of enjoyment of 
No. 
97-1969 
 
9 
life” were claims of loss of consortium which did not survive 
Anneatra's death.  Second, the court concluded that the Estate’s 
remaining allegations of "pain, suffering, and disability; 
medical and psychological expenses" were purely psychological 
and dismissed the remainder of the Estate’s claim on grounds of 
public policy, reasoning that allowance of recovery in this case 
would be too likely to open the way for fraudulent claims and 
because it believed that allowing recovery would enter a field 
that has no sensible or just stopping point. 
¶23 The court of appeals reversed as to each of these 
rulings and we affirm.  We hold that the Sawyers have stated a 
proper cause of action for professional negligence against both 
Lausted and Midelfort and that their claims are not barred by 
the doctrine of laches.  Further, the Sawyers’ negligent 
infliction of emotional distress claim is not time barred.  
Finally, the Estate’s claim is neither barred on grounds of 
public policy nor due to the doctrine of laches. 
¶24 Procedurally, this case is before this court pursuant 
to the circuit court's grant of summary judgment to the 
defendants-respondents-petitioners.  We independently review a 
grant of summary judgment applying the same methodology as that 
used by the circuit court.  Jackson v. Benson, 218 Wis. 2d 835, 
852, 578 N.W.2d 602 (1998).  A motion for summary judgment must 
be granted  
 
if 
the 
pleadings, 
depositions, 
answers 
to 
interrogatories, and admissions on file, together with 
the affidavits, if any, show that there is no genuine 
No. 
97-1969 
 
10
issue as to any material fact and that the moving 
party is entitled to a judgment as a matter of law. 
Wis. Stat. § 802.08(2).  We explained the process by which we 
decide motions for summary judgment in Schuster v. Altenberg, 
144 Wis. 2d 223, 424 N.W.2d 159 (1988), as follows: 
 
First, we examine the complaint to determine whether a 
claim for relief has been stated.  In determining the 
legal sufficiency of the complaint, 'the facts pleaded 
by the plaintiff, and 
all reasonable 
inferences 
therefrom, are accepted as true.' Prah v. Maretti, 108 
Wis. 2d 223, 229, 321 N.W.2d 182 (1982).  The 
complaint should be found legally insufficient only if 
'"it is quite clear that under no circumstances can 
the plaintiff recover."'  Id.  [citation omitted]  If 
a claim for relief has been stated, we then turn to 
the 
responsive pleadings 
to 
determine 
whether 
a 
material factual issue exists.  Finally, if no genuine 
issue of material fact exists, the court may determine 
that the moving party is entitled to a judgment as a 
matter of law. 
 
Id. at 228. 
¶25 We first address whether the plaintiffs’ third-party 
professional negligence claims and the Estate’s professional 
negligence claims state claims upon which relief may be granted. 
 In doing so, we accept all the facts pled by the plaintiffs as 
true. 
The Sawyers’ Professional Negligence Claims 
¶26 Whether a third-party professional negligence cause of 
action against a therapist and psychiatrist3 to recover damages 
stemming from injuries caused by a patient's false memories of 
abuse may be maintained in Wisconsin is a question of law.  See 
                     
3 Throughout the opinion we use the terms "therapist," 
"psychiatrist," and "psychotherapist" interchangeably.  
No. 
97-1969 
 
11
Miller v. Wal-Mart Stores, Inc., 219 Wis. 2d 250, 259, 580 
N.W.2d 233 (1998).  This court reviews questions of law de novo. 
 Id. 
¶27 The 
defendants 
make 
two 
arguments 
opposing 
our 
recognition of the Sawyers’ cause of action.  First, they argue 
that the Sawyers’ cause of action has not been recognized under 
Wisconsin law, and was in fact specifically rejected by this 
court in Wells Estate, 183 Wis. 2d 667.  They ask that we 
preclude the Sawyers’ recovery on the grounds articulated 
therein.  Second, the defendants argue that the Sawyers’ claim 
must be rejected on public policy grounds.4 
¶28 As to their argument that Wells Estate is controlling 
authority under which we must reject the Sawyers’ third-party 
professional negligence claim, we find that the defendants are 
in error.  While both in Wells Estate and here the claim at 
issue involves third-party professional negligence, the claims 
                     
4  The defendants do not argue that the plaintiffs have 
failed to properly plead a negligence cause of action.  A 
properly pled negligence action requires the existence of (1) a 
duty of care on the part of the defendant; (2) a breach of that 
duty; (3) a causal connection between the conduct and the 
injury; and (4) an actual loss or damage as a result of the 
injury.  Miller v. Wal-Mart, Inc., 219 Wis. 2d 250, 260, 580 
N.W.2d 233 (1998)(citing Rockweit v. Senacal, 197 Wis. 2d 409, 
418, 541 N.W.2d 742 (1995)).  
The defendants make no attempt to cast doubt upon the 
existence of any of the elements of the plaintiffs’ cause of 
action, nor the plaintiffs’ ability to prove each element.  We 
understand that for the purpose of their motion for summary 
judgment, the defendants do not dispute that all of the elements 
of a properly pled negligence action have been met. 
No. 
97-1969 
 
12
are distinguishable.  In Wells Estate, we held that Wisconsin 
law would not recognize a mother's professional malpractice 
claim against her adult daughter’s physicians seeking damages 
for the mother’s “loss of society and companionship” when her 
daughter died following treatment.  Wells Estate, 183 Wis. 2d at 
679.  In contrast, the Sawyers have not alleged that their 
injuries are due to “loss of society and companionship,” but 
rather are due to “past and future pain, suffering and loss of 
enjoyment of life.”  While the circuit court and the defendants 
characterize the Sawyers’ allegations as the equivalent of a 
claim seeking compensation due to the “loss of society and 
companionship,”5 the difference between the nature of the injury 
alleged in Wells Estate and the nature of the injury alleged by 
the Sawyers is more than semantic. 
¶29 A claim for the loss of society and companionship 
seeks damages for a tortfeasor’s interference with a personal 
relationship.  The “plaintiff’s recovery in such cases is 
predicated upon the emotional ties he or she shares with the 
injured party.”  Id. at 675.  In contrast, the Sawyers’ claim 
does not allege that the defendants’ negligence interfered with 
their relationship with their daughter, nor is their recovery 
predicated upon the emotional ties they shared with their 
daughter.  Instead, the Sawyers’ recovery is predicated upon the 
direct injury they themselves suffered as a result of the 
                     
5  Or the “interference with filial relationships” as the 
circuit court described the Sawyers’ claim. 
No. 
97-1969 
 
13
defendants’ 
negligence 
which 
was 
responsible 
for 
their 
daughter's accusations that they were abusive.  The harm arising 
from the loss of a daughters’ companionship is different than 
the harm that arises from accusations of sexual assault.   
¶30 We have previously noted that those accused of sexual 
assault 
feel 
the 
pain 
and 
stigma 
associated 
with 
the 
accusations.  See Doe v. Archdiocese of Milwaukee, 211 Wis. 2d 
312, 355, 565 N.W.2d 94 (1997).  However, the pain and suffering 
and loss of enjoyment of life arising from a false accusation 
are 
injuries 
not 
predicated 
upon 
an 
accused's 
personal 
relationship with his or her accuser.  As will become clear from 
the public policy discussion which follows, the difference 
between the injury claimed in Wells Estate and the injury 
claimed here is substantial, and the public policy concerns upon 
which we precluded the imposition of liability in Wells Estate 
are not present in this case.  We find that Wells Estate does 
not control. 
¶31 While 
we 
rejected 
the 
third-party 
professional 
negligence claim in Wells Estate, rejection of third-party 
professional negligence claims under other circumstances is not 
foreordained.  Indeed, this court has recognized the legitimacy 
of 
third-party 
professional 
negligence 
claims 
in 
certain 
circumstances.  See, e.g., A. E. Investment Corp. v. Link 
Builders, 
Inc., 62 
Wis. 
2d 
479, 
214 
N.W.2d 
764 
(1974) 
(recognizing that architects may be held liable to a lessee 
harmed by the negligent construction of a building);  Auric v. 
Continental Cas. Co., 111 Wis. 2d 507, 331 N.W.2d 325 (1983) 
No. 
97-1969 
 
14
(recognizing that an attorney may be held liable to the 
beneficiaries of a will harmed by negligent drafting of the will 
on the behalf of a testator); Citizens State Bank v. Timm, 
Schmidt & Co., 113 Wis. 2d 376, 335 N.W.2d 361 (1983) 
(recognizing that an accountant may be held liable to a lender 
harmed by reliance on an audit report negligently prepared for 
borrower).  Of most import, in a case closest to the facts we 
face here, we held that a psychiatrist may be held liable to 
third parties for failure to warn a patient of a medication's 
side effects.  Schuster, 144 Wis. 2d 223.   
¶32 Relying upon Schuster, the plaintiffs argue we should 
recognize their cause of action as merely the application of a 
new set of facts to established law.  Although we recognized 
three separate third-party causes of action in Schuster, the one 
most closely on point to the issue we face here involved the 
question of whether a psychiatrist could be held liable to third 
parties for injuries the third parties sustained as a result of 
the psychiatrist's negligent diagnosis and treatment of a 
patient.  Id. at 229.  The plaintiff in Schuster was injured in 
an automobile accident while her mother, who was medicated, was 
driving.  The daughter alleged that her mother's psychotherapist 
did not warn her mother of the side effects of her medication.  
We held that "a psychotherapist may be held liable in negligence 
for failure to warn of the side effects of a medication if the 
side effects were such that a patient should have been cautioned 
against driving, because it was foreseeable that an accident 
No. 
97-1969 
 
15
could result, causing harm to the patient or third parties if 
the patient drove while using the medication."  Id. at 232-33. 
 
¶33 The defendants argue that Schuster is not controlling 
on 
the 
question 
before 
this 
court 
because 
it 
may 
be 
distinguished from the case before us on the facts.  First, 
Schuster involved physical injury, not the non-physical injuries 
alleged by the plaintiffs in this action.  Second, the 
“diagnosis and treatment” that was in issue in Schuster, and 
which the 
defendants characterize 
as 
properly 
prescribing 
medication, was not as complex as is the diagnosis and treatment 
of mental health patients. 
¶34 We observe that the facts involved in Schuster differ 
from those here.  However, whether these factual differences 
merit rejection of the Sawyers’ cause of action turns on whether 
considerations of public policy should preclude the imposition 
of liability under the facts of this case.  The parties agree 
and have provided detailed public policy analyses of the 
question we face. 
¶35 We have explained that “[t]he fundamental principle of 
Wisconsin negligence law . . . [is] that a tortfeasor is fully 
liable for all foreseeable consequences of his act except as 
those consequences are limited by policy factors.”  Citizens 
State Bank, 113 Wis. 2d at 386.  Our decisions have established 
that when a negligence action is properly pled, and all of the 
elements of the cause of action met, liability may be limited as 
a matter of law where considerations of public policy require 
dismissal of the claim and relieve the defendant of liability in 
No. 
97-1969 
 
16
a particular case.  See Bowen v. Lumbermens Mut. Cas. Co., 183 
Wis. 2d 627, 654, 517 N.W.2d 432 (1994); Peters v. Menard, 224 
Wis. 2d 174, 193, 589 N.W.2d 395 (1999).  The denial of 
liability 
upon 
public 
policy 
grounds 
is 
best 
determined 
following a trial and a full consideration of the facts.  Bowen, 
183 Wis. 2d at 654.  However, where the facts presented are 
simple and the question of public policy is fully presented by 
the complaint and the motion for summary judgment, this court 
may make the public policy determination.  See id. at 654-55.  
This is such a case. 
¶36 In deciding whether public policy precludes imposing 
liability on the defendants, we consider whether: 
 
'(1) the injury is too remote from the negligence; or  
'(2) the injury is too wholly out of proportion to the 
culpability of the negligent tort-feasor; or 
'(3) in retrospect it appears too highly extraordinary 
that the negligence should have brought about the 
harm; or 
'(4) 
allowance 
of 
recovery 
would 
place 
too 
unreasonable a burden on the negligent tort-feasor; or 
'(5) allowance of recovery would be too likely to open 
the way for fraudulent claims; or 
'(6) allowance of recovery would enter a field that 
has no sensible or just stopping point."  Garret [v. 
City of New Berlin], 122 Wis. 2d [223], 233-34, [362 
N.W.2d 137 (1985)]. 
 
Schuster, 144 Wis. 2d at 242-43.  In addition to these public 
policy considerations, the defendants express deep concern that 
our recognition of the Sawyers’ cause of action will seriously 
damage the therapist-patient relationship; we address these 
collateral burdens identified by the defendants as well.  
No. 
97-1969 
 
17
 
¶37 Our 
first 
consideration is 
whether 
the Sawyers’ 
injuries are too remote from the defendants' negligence.  We 
believe that they are not: the Sawyers' injuries stem directly 
from their daughter's accusations that they abused her, and the 
accusations stem from the defendants’ negligent treatment that 
implanted or reinforced in Anneatra her false memories of sexual 
abuse.  The Sawyers’ injuries stand apart from the defendants’ 
negligence the same degree the plaintiff’s injury stood apart 
from the defendant's negligence in Schuster.  See Schuster, 144 
Wis. 2d 223 (plaintiff was injured by the patient of the 
defendant psychotherapist).  The proximity of the injury to the 
negligence in Schuster did not preclude our imposition of 
liability there, and it should not here.  In third-party causes 
of action, a plaintiff’s injury will be separated from a 
defendant's negligence to at least the degree involved here, and 
this public policy consideration does not preclude liability in 
those circumstances.  Privity is not required per se to maintain 
a negligence action in Wisconsin.  See id.  Furthermore, the 
defendants have not contended that the Sawyers’ injuries were 
remote from their negligence. 
¶38 We also do not believe that the alleged injuries are 
too wholly out of proportion to the culpability of the negligent 
tortfeasor, and the defendants appear to be in agreement as to 
this point as well.  This court has tied culpability in 
negligence jurisprudence to foreseeability.  Beacon Bowl v. Wis. 
Elec. Power Co., 176 Wis. 2d 740, 762, 501 N.W.2d 788 (1993).  
In their brief, the defendants conceded that "damage to a person 
No. 
97-1969 
 
18
accused of abusive behavior is certainly foreseeable," an 
understanding with which we are in full agreement.  Even those 
jurisdictions which have declined to impose liability under 
facts similar to those here have acknowledged that "the harm to 
a parent accused of sexual abuse is foreseeable."  See, e.g., 
Bird v. W.C.W., 868 S.W.2d 767, 768 (Tex. 1994). 
¶39 We have previously observed the great harm that 
accompanies an accusation of sexual abuse of a child.  See Doe, 
211 Wis. 2d at 355 n.31. (“'Society’s justifiable repugnance 
toward (sexual abuse of a child) . . . is the reason why a 
falsely accused [person] can be gravely harmed.'” (citation 
omitted)).  Others have observed that “[i]t is indisputable that 
‘being labeled a child abuser (is) one of the most loathsome 
labels in society’ and most often results in grave physical, 
emotional, 
professional, 
and 
personal 
ramifications."  
Hungerford v. Jones, 722 A.2d 478, 480 (N.H. 1998)(citation 
omitted).  We are quite confident that negligent treatment which 
encourages false accusations of sexual abuse is highly culpable 
for the resulting injury. 
¶40 As for our consideration of the third public policy, 
we do not find the Sawyers’ injuries to be too highly 
extraordinary that the defendants’ alleged negligence should 
have brought about the harm.  The harms the Sawyers have alleged 
are the ordinary and predictable injuries one might expect 
following negligent therapy which implants and reinforces false 
memories of sexual abuse at the hands of family members which 
results in accusations of that abuse. 
No. 
97-1969 
 
19
¶41 We next consider whether allowance of recovery would 
place too unreasonable a burden on the negligent tortfeasor.  
The defendants argue that allowing the parents of an adult child 
a 
claim 
for 
third-party 
professional 
negligence 
would 
unreasonably burden the tortfeasor with multiple suits premised 
upon a single negligent act.  They rely upon Wells Estate for 
support that this public policy consideration should act to 
preclude imposing liability under the facts here.  However, our 
consideration of this public policy does not lead us to the 
result reached in Wells Estate, for as noted in our discussion 
above, the defendants misconceive the nature of the Sawyers’ 
allegations, allegations which we do not believe give rise to 
excessive liability.  
¶42 When in Wells Estate we concluded that Wisconsin law 
did not recognize a parent’s claim for the loss of an adult 
child’s society and companionship, we recognized that to allow 
recovery for such a claim would impose excessive liability upon 
the tortfeasor because "the possible universe of claimants is 
limited only by the number of persons with whom the injured 
person has established personal relationships."  Wells Estate, 
183 Wis. 2d at 675.  Under Wisconsin law, a negligent tortfeasor 
may be liable to the victim for the injuries sustained, and to 
the victim’s spouse and minor children for loss of society and 
companionship. Id. at 677-78.  We concluded that sound public 
policy dictates that a limit be placed upon the liability facing 
negligent tortfeasors,  id. at 677, tying this conclusion to our 
concern that the death of any one person would leave unknown 
No. 
97-1969 
 
20
numbers of individuals with potential claims for loss of society 
and companionship. 
¶43 However, as we have noted, in contrast to Wells 
Estate, the Sawyers are not claiming loss of society and 
companionship or damages that resulted from their estrangement 
from their daughter.  The Sawyers’ claim is related to the harm 
that arose directly as a result of Anneatra’s accusations.  
Importantly, unlike the claim involved in Wells Estate, the 
Sawyers’ claim may be brought only by those who have been 
wrongfully accused of sexually abusing their accuser, not by the 
unknown numbers of individuals whose relationship with the 
patient is negatively affected by the negligent therapy.  Under 
the Sawyers' theory of the case, therapists may be held liable 
only to those who are wrongly accused by a patient of sexually 
abusing that patient.  Therefore, the defendants fear of 
excessive liability is misplaced. 
¶44 Fifth, we consider whether allowing the Sawyers to 
recover would be too likely to open the way to fraudulent 
claims. The defendants contend that the potential for fraudulent 
claims involves the possibility that an individual will claim 
that his or her relationship with a patient was negatively 
affected 
by the patient’s 
therapy 
and as 
a 
result was 
emotionally harmed.  Fraud, the defendants claim, will be 
manifest in claims brought by those who did not in fact share a 
substantial relationship with their patient.  However, as we 
noted above, the Sawyers’ claim is not tied to personal 
relationships, but rather to accusations of abuse.  Defendants 
No. 
97-1969 
 
21
need not be concerned with the difficult task of rebutting 
evidence of a plaintiff's close personal relationship with a 
patient who was treated negligently, because this cause of 
action is not premised upon the relationship, but rather the 
accusation.  Further, we doubt that there is a significant 
possibility of fraud when a claim is based upon accusations of 
abuse, particularly in light of the extraordinary stigma our 
society places upon those accused of sexually abusing a child.  
We find that it is too unlikely that a claim premised upon being 
falsely accused of sexual abuse will be brought by someone who 
has not, in fact, been so accused. 
¶45 Finally, we disagree that allowing the Sawyers in this 
case to bring an action will enter a field that has no sensible 
or just stopping point.  The defendants express concern that by 
imposing liability in this case this court will open the door to 
claims of emotional harm and damaged personal relationships from 
all manner of individuals who believe that their relationships 
with a patient have been negatively affected by the patient’s 
therapy.  However, as we have discussed above, the Sawyers' 
claims differ from those claims alleging interference with 
personal  relationships.  The Sawyers’ claims are not related to 
their 
estrangement 
from 
Anneatra. 
 
Their 
claims 
are 
appropriately limited to those who are harmed by the accusations 
of sexual abuse arising from false and reinforced memories 
arising from negligent therapies.  So limited, the claim has a 
sensible and just stopping point. 
No. 
97-1969 
 
22
¶46 None 
of 
these 
public 
policies 
lead 
us 
to 
the 
conclusion that liability should be limited in this case.  
However, we also consider the collateral burden our recognition 
of the Sawyers’ claim may have on the therapist-patient 
relationship.  The defendants have identified two primary 
manifestations of the burden. 
¶47 First, the defendants argue that a therapist who is 
held liable to third parties for their emotional health will 
push therapists to either cease treating patients who believe 
they may have been sexually abused, or refrain from using new 
and untested forms of therapy which they believe are best suited 
for treating their patients.  The defendants believe that in 
either event a patient's well-being will be substantially 
harmed. 
¶48 Those courts which have concluded that claims similar 
to the Sawyers should be rejected have done so by recognizing 
these concerns.  In Flanders v. Cooper, 706 A.2d 589 (Maine 
1998), for instance, the Maine Supreme Court concluded that 
public policy precluded imposing upon a health care professional 
a duty of care to injured third parties because such a duty 
would intrude directly on the professional-patient relationship. 
 Id. at 591.  The court observed that by placing such duty of 
due care to third parties upon therapists, "[a] health care 
professional who suspected that a patient had been the victim of 
sexual abuse and who wanted to explore that possibility in 
treatment would have to consider the potential exposure to legal 
action by a third party who committed the abuse."  Id.  This, 
No. 
97-1969 
 
23
the court concluded, would improperly restrict the treatment 
choices of the health care professional.  Id. 
¶49 The Supreme Court of Illinois, in Doe v. McKay, 700 
N.E.2d 1018 (1998), reached a similar conclusion, expressing the 
concern raised in Flanders that third-party liability would 
intrude too closely on the therapist-patient relationship.  
“Hoping to avoid liability to third parties” the court wrote, “a 
therapist might instead find it necessary to deviate from the 
treatment the therapist would normally provide, to the patient’s 
ultimate detriment.  This would exact an intolerably high price 
from the patient-therapist relationship and would be destructive 
of that relationship.”  Id. at 1024. 
¶50 We are not unsympathetic to the therapist-patient 
relationship.  However, we are not convinced that therapists 
will be limited in their treatment choices by virtue of being 
subject to third-party professional negligence claims.  We agree 
with the reasoning of the Supreme Court of New Hampshire in 
Hungerford, 722 A.2d 478, which wrote that the defendants’ 
public policy concerns with restricting a therapist’s choice of 
treatments, and discouraging therapists to treat those who 
believe they may have been sexually abused in the past out of 
fear of liability, “overlooks the fact that the standard of care 
by which a therapist’s conduct is measured is not heightened [by 
a third-party cause of action].”  Id. at 481-82.  The cause of 
action “imposes ‘no more than what a therapist is already bound 
to providea competent and carefully considered professional 
judgement.’”  Id. at 482 (citing Althaus by Althaus v. Cohen, 
No. 
97-1969 
 
24
710 A.2d 1147, 1157 (Pa. Super. Ct. 1998); see [Montoya by 
Montoya v.] Bebensee, 761 P.2d [285], 288-89 [(Colo. Ct. App. 
1988)])). 
¶51 In Wisconsin,  
 
a medical practitioner, 'be he a general practitioner 
or a specialist, should be subject to liability in an 
action for negligence if he fails to exercise that 
degree of care and skill which is exercised by the 
average practitioner in the class to which he belongs, 
acting in the same or similar circumstances.'  Shier 
v. Freedman, 58 Wis. 2d 269, 283-84, 206 N.W.2d 166, 
208 N.W.2d 328 (1973). 
Schuster, 144 Wis. 2d at 229.  We have further explained that we 
could “conceive of no reason why a psychiatrist, as a specialist 
in the practice of medicine, should not be compelled, as are all 
other practitioners, to meet the accepted standard of care 
established by other practitioners in the same class.”  Id. at 
230.  The Sawyers' third-party action will not burden the 
therapist with a standard of care more onerous than that under 
which he or she is already required to act in treating his or 
her patients.  Therefore, the therapist's treatment choices need 
be limited only by the duty of care the therapist owes his or 
her patient. 
¶52 The defendants insist that the treatment of sexual 
abuse is so much more complex than is prescribing medication 
that our conclusion in Schuster is not applicable here.  We 
disagree as to this point as well.  Our holding in Schuster with 
respect to the standard of care to which a psychiatrist would be 
held was not dependent upon the complexity of the therapy or 
No. 
97-1969 
 
25
treatment involved.  Furthermore, complexity of therapy or 
treatment necessarily is a factor that informs what is found to 
be the standard of due care in a particular case.  Presumably, 
the more complex the health problem a therapist is faced with, 
the more latitude a therapist will have in treatment choices.  
However, we do not believe that a therapist should be relieved 
from liability when his or her treatment is negligent simply 
because the problem he or she is treating is complex.   
¶53 As to this burden, we conclude that “the therapist is 
in the best position to avoid harm to the accused parent and is 
solely responsible for the treatment procedure.”  Hungerford, 
722 A.2d at 482.  “[A]n accused parent should have the right to 
reasonably 
expect 
that 
a 
determination 
of 
sexual 
abuse, 
'touching him or her as profoundly as it will, will be carefully 
made.'”  Id. at 482 (citing S. v. Child & Adolescent Treatment, 
614 N.Y.S.2d at 666).6 
¶54 The second manifestation of the burden the defendants 
believe weighs against recognizing the Sawyers' cause of action 
involves the importance of confidentiality in the therapist-
patient relationship.  The defendants believe that recognition 
of the Sawyers’ claim will unduly burden the therapist and his 
or her patient because such claims place confidentiality between 
the patient and the therapist at substantial risk.  Because the 
                     
6 We do not agree with the Hungerford v. Jones, 722 A.2d 
478, 480 (N.H. 1998), court that the third-party action may be 
recognized only where the accusation of sexual abuse has been 
made public. 
No. 
97-1969 
 
26
patient holds the privilege of confidentiality, the defendants 
in third-party actions may not be able to successfully defend 
themselves, for they will not be able to breach their duty of 
confidentiality to their patients. 
¶55 The problem identified by the defendants is not 
present in this case.  Due to Anneatra's death, the plaintiffs 
have access to her medical records.  Perhaps problems of 
confidentiality would preclude liability from being imposed in a 
future case, but here it does not. 
¶56 In sum, we find that none of the public policy 
considerations identified by the defendants should preclude the 
imposition of liability in this case. 
The Estate's Cause of Action 
¶57 The Estate alleges that due to the defendants' 
negligent treatment, Anneatra experienced "pain, suffering and 
disability; medical, psychiatric and psychological expenses; 
loss of enjoyment of life."  In holding that the Estate does 
allege a claim upon which relief can be granted, we recognize 
the well-settled rule that courts liberally construe allegations 
presented in a complaint and accept them as true for purposes of 
determining whether a claim is stated.  See Hermann v. Town of 
Delavan, 215 Wis. 2d 370, 378, 572 N.W.2d 855 (1998).  We read 
the 
Estate's 
claim 
as 
a 
valid 
survival 
action 
seeking 
compensatory damages stemming from professional negligence. 
¶58 Whether the Estate has stated a cause of action which 
survives Anneatra's death is governed by Wis. Stat. § 895.01(1), 
Wisconsin's survival statute, as well as considerations of 
No. 
97-1969 
 
27
public policy. The defendants divide the Estate's claim into two 
separate 
causes of 
action. 
 They 
argue 
first 
that the 
allegations concerning Anneatra's "loss of enjoyment of life" is 
precluded as personal to Anneatra and therefore not surviving 
under our interpretation of the scope of Wis. Stat. § 895.01(1). 
 Second, the defendants maintain that the Estate's allegations 
concerning "pain, suffering and disability; medical, psychiatric 
and psychological expenses," while not precluded by Wis. Stat. 
§ 895.01(1) or our interpretation of the statute, should be 
barred by considerations of public policy. 
¶59 Wisconsin Stat. § 895.01(1) governs survival claims 
and provides in relevant part, that 
 
[i]n addition to the causes of action that survive at 
common law, the following shall also survive: causes 
of action . . . for . . . other damage to the person. 
. . .  
Id.  The parties are in agreement that should the Estate have 
properly stated a survival claim, it must be read as one 
alleging "other damage to the person." 
¶60 While we have written that Wis. Stat. § 895.01(1) does 
not limit the nature of the damages that may be recovered under 
a survival action, Wangen v. Ford Motor Co., 97 Wis. 2d 260, 
310, 294 N.W.2d 437 (1980), we have held that not all actions 
survive one's death.  See Howard v. Lunaburg, 192 Wis. 507, 511, 
213 N.W. 301 (1927).  Specifically, we held that “[d]amage to 
feelings, or loss of consortium” did not constitute a property 
right nor damages to the person within the meaning of the 
survival statute.  Id.  Subsequently, in Hanson v. Valdivia, 51 
No. 
97-1969 
 
28
Wis. 2d 466, 187 N.W.2d 151 (1971), we held that an action for 
the alienation of affection did not survive to the Estate.   
¶61 Here, the defendants argue that the Estate’s claim 
alleging loss of enjoyment of life is the equivalent of a claim 
for the termination of Anneatra's relationship with her parents, 
and must be rejected in accord with our holding in Hanson.  
However, Hanson does not control, for a claim seeking damages 
for the loss of enjoyment of life resulting from professional 
negligence is not analogous to an action for the alienation of 
affection.  Loss of enjoyment of life includes those damages 
that result from one's "diminished capacity for enjoying life" 
or due to the "deprivations of the pleasures of life."  See 
Bassett v. Milwaukee N. R. Co., 169 Wis. 152, 159, 170 N.W.2d 
944 (1919).  These are not the equivalent to damages to feelings 
or loss of consortium upon which we precluded a claim for 
alienation of affection in Hanson.  Instead, the alleged damages 
are those that flow from professional negligence just as pain 
and suffering and costs associated with medical treatment flow. 
 They include but are not limited to damages associated with a 
plaintiff's inability to engage in the activities of life he or 
she had been able to prior to the defendant's negligence, and 
they are not damages predicated upon a relationship with another 
person. 
¶62 The defendants also assert that the Estate's claim, 
alleging only psychological damages, must be dismissed on the 
public policy grounds that allowing the Estate’s claim would 
open the way for fraudulent claims; they rely upon our decision 
No. 
97-1969 
 
29
in Bowen for this conclusion.  However, the claim asserted by 
the Estate is not analogous to the claim brought in Bowen, nor 
does consideration of the public policy which precluded imposing 
liability there lead to the same conclusion here. 
¶63 The estate's claim in Bowen was one for the negligent 
infliction 
of 
emotional 
distress 
which 
related 
to 
the 
"apprehension and fear [the decedent] suffered before his 
death."  Bowen, 183 Wis. 2d at 661.  The decedent in Bowen was 
killed when he was hit by a vehicle and fatally injured while 
riding his bicycle.  Id. at 634.  This court rejected the 
Estate’s claim for the decedent’s emotional distress which was 
allegedly endured in the few moments immediately preceding his 
death.  We concluded that  
 
It is mere speculation to assert that [the decedent] 
knew of the impending impact or suffered severe 
emotional distress in the moments before impact.  
Allowance of recovery under the circumstances of this 
case would be too likely to open the way to fraudulent 
claims. 
Id. at 662. 
¶64 The facts of this case are inapposite.  The most 
compelling difference between the Estate's claim here and the 
claim in Bowen is the length of time between the negligent act 
to the moment of death.  While in Bowen, mere moments between 
the two acts passed and we rightly believed that one could not 
determine the amount of distress, if any, the victim could have 
experienced, here, Anneatra’s injuries are not necessarily 
speculative.  At the motion on the hearing for summary judgment, 
the circuit court elicited from plaintiffs' counsel the manner 
No. 
97-1969 
 
30
in which they intended to prove Anneatra's injuries, namely 
through examination of witnesses who had opportunity to talk 
with Anneatra in the many years she was being treated by the 
defendants, as well as evidence of her injuries in diary 
entries.  Further, the emotional injuries Anneatra suffered may 
be determined with a view to her medical records.  The concerns 
we expressed in Bowen are not present in this case to the extent 
that we must conclude that the Estate’s claim should not be 
allowed to proceed.  The professional negligence claim survives 
to Anneatra’s Estate. 
Statute of Limitations 
¶65 Defendants additionally argue that the Sawyers' claim 
for negligent infliction of emotional distress against Lausted 
is barred by Wis. Stat. § 893.547, the three-year statute of 
limitations governing injury to the person.8  The Sawyers' claim 
for negligent infliction of emotional distress arises out of 
damages they allegedly suffered in 1985 when Anneatra confronted 
her parents and accused both of physically abusing her, and 
                     
7  Wis. Stat. § 893.54(1) provides in relevant part that an 
action to recover damages for injuries to the person must be 
commenced within 3 years or be barred. 
8 On appeal the defendants do not argue that the Sawyers’ 
professional negligence claims against Midelfort and Lausted are 
barred by the workings of the statute of limitations.  In the 
court of appeals, the defendant Lausted argued that the Sawyers' 
professional negligence claim and their claim of negligent 
infliction of emotional distress were barred by the statute of 
limitations. 
 
Here, 
though, 
the 
defendants' 
statute 
of 
limitations argument is limited to the Sawyers' negligent 
infliction of emotional distress against Lausted. 
No. 
97-1969 
 
31
accused her father of sexually abusing her.  As noted in our 
earlier discussion, in addition to Anneatra and the Sawyers, 
Lausted 
and 
Dr. 
Bemmann 
were 
also 
present 
during 
the 
confrontation.  Having filed their claim in 1996, unless the 
workings of the discovery rule adopted by this court in Hansen 
v. A.H. Robins, Inc., 113 Wis. 2d 550, 560, 335 N.W.2d 578 
(1983), extends the deadline by which the Sawyers were required 
to file, their claim is indeed barred.   
¶66 With application of the discovery rule as adopted by 
this court in Hansen, tort claims accrue on the "date the injury 
is discovered or with reasonable diligence should be discovered, 
whichever occurs first."  Id. at 560.  We subsequently explained 
that with application of the discovery rule, "a cause of action 
will not accrue until the plaintiff discovers, or in the 
exercise of reasonable diligence should have discovered, not 
only the fact of the injury but also that the injury was 
probably caused by the defendant's conduct or product,"  Borello 
v. U.S. Oil Co., 130 Wis. 2d 397, 411, 388 N.W.2d 140, 46 
(1986), and later, that the discovery rule should be extended to 
allow a tort action to accrue only after the identity of the 
defendant is known, or reasonably should have been known.  
Spitler v. Dean, 148 Wis. 2d 630, 631-32, 436 N.W.2d 308 (1989). 
 Until the time that a plaintiff discovers, or with reasonable 
diligence should have discovered, that he or she has suffered 
actual damage due to the wrongs committed by a particular, 
identified person, they are not capable of enforcing their 
claims, either because they do not know that they have been 
No. 
97-1969 
 
32
wronged or because they do not know the identity of the person 
who has wronged them.  Pritzlaff v. Archdiocese of Milwaukee, 
194 Wis. 2d 302, 315-16, 533 N.W.2d 780 (1995). 
¶67 The parties do not dispute that the Sawyers’ negligent 
infliction of emotional distress injuries occurred in 1985 when 
the Sawyers’ daughter made her accusations.  However, the 
parties do dispute when the Sawyers should have known that they 
were wronged and when they should have known the identity of the 
person who wronged them. 
¶68 Plaintiffs 
are 
obligated 
to 
exercise 
reasonable 
diligence in discovering the identity of the defendant.  See 
Spitler, 148 Wis. 2d at 638. Reasonable diligence must also be 
exercised in discovering that the defendant caused their 
injuries.  “Reasonable diligence” means that a plaintiff must be 
as diligent “as the great majority of persons would use in the 
same or similar circumstances.”  Id. (citing Hilker v. Western 
Automobile Ins. Co., 204 Wis. 1, 15, 231 N.W. 257, 235 N.W. 413 
(1931)(opinion on reconsideration)).  “Plaintiffs may not close 
their eyes to means of information reasonably accessible to them 
and must 
in 
good 
faith 
apply their 
attention 
to 
those 
particulars which may be inferred to be within their reach.”  
Id. (citing Kanack v. Kremski, 96 Wis. 2d 426, 432, 291 N.W.2d 
864 (1980)).  The question of whether plaintiffs exercised 
reasonable diligence is ordinarily one of fact, to be determined 
by the fact-finder.  Id. 
¶69 Lausted maintains that since the Sawyers claim that 
the abuse never occurred, reasonable people in their position, 
No. 
97-1969 
 
33
upon being confronted with allegations as reprehensible as these 
were, would have investigated the cause of those allegations.  
On the basis of this premise, Lausted argues that the Sawyers 
should have known her identity, and that she was the cause of 
their injuries, no later than 1988. 
¶70 As support for this legal conclusion, Lausted first 
points out that she was in the room with the Sawyers when their 
daughter Anneatra accused them of abuse.  Should that not have 
been sufficient to put the Sawyers on notice that she caused 
their injuries through therapy, Lausted argues that certainly 
upon receiving Anneatra's lawsuit in 1988, wherein Anneatra 
claimed that she was informed of her abuse through treatment and 
counseling, the Sawyers were on notice that Anneatra's counselor 
may have been at fault. 
¶71 In response, the Sawyers argue that they were in fact 
unaware of the role Lausted played in Anneatra's treatment when 
confronted with the allegations in 1985.  They additionally 
claim that Lausted’s role remained unknown when Anneatra filed 
suit in 1988: the lawsuit did not name Anneatra’s therapists.  
Perhaps most important, the Sawyers’ claim that they did not 
know that the therapy was the cause of Anneatra’s false 
memories.  They state that they did not know that Lausted was 
using repressed memory therapy until Dolores was appointed 
administrator of Anneatra’s estate and she was successful in 
gaining access to her daughter’s medical records. 
¶72 With the facts of record, we cannot state that as a 
matter of law the Sawyers failed to exercise reasonable 
No. 
97-1969 
 
34
diligence in discovering the cause of their injury.  While the 
Sawyers knew that they were injured, it is possible as they 
suggest that they did not know until following Anneatra's death 
that their injury was caused by Lausted or by Lausted’s conduct. 
 As the court of appeals noted in its decision, the Sawyers have 
suggested a number of possible causes of their injuries apart 
from Lausted's negligence, including: "psychiatric illness, 
Anneatra's involvement in survivor groups, ill will or spite, or 
the reading of popular literature on childhood sexual abuse."  
Sawyer, 217 Wis. 2d at 816 n.9.  Should any one of these 
alternate, and plausible, reasons for Anneatra’s accusations be 
responsible for their injuries, the Sawyers would not have been 
wronged and therefore would not have had a claim against anyone. 
 It was only upon discovering that Lausted was using repressed 
memory therapy that they determined that their injury was the 
result of the negligent act of another.  Whether a reasonable 
person in the Sawyers’ position would have done more to discover 
that their injuries could be attributed to Lausted’s negligence 
is a factual question best left to the fact-finder.  Summary 
judgment should not have been granted on this issue. 
Doctrine of Laches 
¶73 Finally, the defendants assert that the doctrine of 
laches entitles them to summary judgment on both the Sawyers' 
and the Estate’s professional negligence claims.  We conclude 
No. 
97-1969 
 
35
that as the first element of laches has not been established as 
a matter of law, summary judgment on this ground was improper.9 
¶74 Laches is an equitable defense to an action based on 
the plaintiff's unreasonable delay in bringing suit under 
circumstances in which such delay is prejudicial to the 
defendant.  See Schafer v. Wegner, 78 Wis. 2d 127, 132, 254 
N.W.2d 193, 196 (1977).  The successful assertion of laches 
requires 
that 
the 
defense 
prove 
that 
1) 
the 
plaintiff 
unreasonably delayed in bringing the claim, 2) the defense 
lacked any knowledge that the plaintiff would assert the right 
on which the suit is based, and 3) the defense is prejudiced by 
the delay.  Schneider Fuel v. West Allis State Bank, 70 Wis. 2d 
1041, 1053, 236 N.W.2d 266 (1975).  If any single element is 
missing, laches will not be applied and the claims allowed to 
proceed.  Where the facts are undisputed and there is only one 
reasonable inference, the court may conclude as a matter of law 
that the elements are met.  See Schafer, 78 Wis. 2d at 132, 254 
N.W.2d at 196 (concluding that prejudice was established in that 
case as a matter of law).  If the material facts or reasonable 
inferences are disputed, however, summary judgment will be 
improper. 
                     
9 As we conclude that the defendants have not met each of 
the elements required of a laches defense, we need not address 
the plaintiff-appellant's additional argument that the doctrine 
of laches is an equitable defense that may not be pled in claims 
of law.  See State v. Castillo, 213 Wis. 2d 488, 492, 570 N.W.2d 
44 (1997) (an appellate court should decide cases on the 
narrowest possible grounds).  
No. 
97-1969 
 
36
¶75 Under the facts of the record before us, we cannot 
conclude that the defense of laches has been established.  Under 
the first prong of the laches defense, defendants must show that 
the plaintiffs unreasonably delayed in bringing this lawsuit.  
Just as we concluded that whether the Sawyers should have known 
that Lausted's negligent therapy was the cause of their injuries 
was one to be resolved by the fact-finder, it logically follows 
from that conclusion that a question of fact also exists as to 
whether the Sawyers unreasonably delayed in bringing the 
professional negligence claims against Midelfort and Lausted, 
for it is not possible to determine whether the Sawyers delayed 
in bringing these claims unless it is first determined when 
their lawsuit against each defendant accrued.  And as is true of 
the Sawyers’ negligent infliction of emotional distress claim, 
so to is it not possible on summary judgment to determine when 
their professional negligence claim accrued. 
¶76 We agree with the court of appeals’ conclusion that 
 
If it is true, as the Sawyers claim, that they had no 
reason to believe Lausted's and Midelfort's negligent 
treatment caused Anneatra to make her allegations, and 
if it is also true that they made several unsuccessful 
attempts to discern what caused the allegations, their 
delay in bringing the action until they obtained 
Anneatra's medical records would not appear to be 
unreasonable. 
Sawyer, 217 Wis. 2d at 806. 
¶77 Whether the Estate unreasonably delayed in bringing 
suit is a question requiring a different focus.  The defendants 
suggest that all of the facts with regard to Anneatra’s 
No. 
97-1969 
 
37
treatment were in her possession for years before the Estate 
brought its suit; therefore, when considering this survival 
action we must conclude that because Anneatra had knowledge of 
the elements of her claim, by implication her Estate must be 
held to have had the knowledge.  We disagree. 
¶78 The central component of the Estate’s claim is its 
belief that Anneatra did not know that she was being treated 
negligently.  While the doctrine of laches is a defense apart 
from the statute of limitations, we believe that the discovery 
rule of the latter defense provides helpful analysis for the 
application of the former defense.  Under the discovery rule, a 
cause of action does not accrue until the plaintiff knows that 
he or she has been injured.  The Estate's claim is premised upon 
Anneatra's lack of knowledge that she was being treated 
negligently.  Therefore, the Estate's cause of action did not 
accrue until it discovered her injury when it gained access to 
her treatment records.  The Estate did not unreasonably delay in 
bringing its claim. 
Conclusion 
¶79 We conclude that the circuit court should not have 
entered summary judgment on the Sawyers' and the Estate's 
claims.  Both the Sawyers and the Estate have stated claims upon 
which relief may be granted.  None of the claims should have 
been dismissed on grounds of the statute of limitations or by 
the workings of the doctrine of laches. 
By the Court.— The decision of the court of appeals is 
affirmed. 
No. 
97-1969 
 
38
 
¶80 CHIEF 
JUSTICE 
SHIRLEY 
S. 
ABRAHAMSON 
did 
not 
participate.  
  
 
97-1969.jpw 
 
1 
¶81 JON P. WILCOX, J. (concurring).   It is with a bit of 
reluctance that I join the majority in its decision today.  
Without question, this is not an easy case—the allegations by 
Nancy 
K. 
Anneatra, 
true 
or 
false, 
are 
disturbing 
and 
regrettable.  Nevertheless, I agree with the majority that there 
are genuine issues of material fact at issue in this case.  I 
write separately to reiterate the narrow scope of the majority’s 
decision based upon the unique facts of this case. 
¶82 As I understand the majority’s interpretation of the 
plaintiffs’ third-party professional negligence claims, it is 
limited to “the harm that arose directly as a result of 
Anneatra's accusations.”  Majority at 20.  It does not include 
loss of society or companionship, or their estrangement from 
Anneatra.  Majority at 12-13, 21.  The majority has similarly 
limited the Estate's claim to “damages associated with the 
plaintiff’s inability to engage in the activities of life he or 
she had been able to prior to the defendant’s negligence, and 
they are not damages predicated upon a relationship with another 
person,” as well as damages for pain and suffering and expenses. 
 Majority at 26, 28.  The majority’s public policy arguments are 
premised on the limited nature of these claims and are now the 
law of the case.  Univest Corp. v. General Split Corp., 148 Wis. 
2d 29, 38-39, 435 N.W.2d 234 (1989).   
¶83 Despite the limited nature of the majority’s holding, 
I am still concerned that by allowing this suit to go forward 
others will soon follow.  From a public policy standpoint, such 
actions 
may 
place 
an 
unreasonable 
burden 
on 
therapists’ 
97-1969.jpw 
 
2 
treatment choices and on confidentiality between therapists and 
patients.   
¶84 The majority dismisses the defendants’ public policy 
concerns relating to the restriction of a therapist’s choice of 
treatments.  I however believe that the concerns expressed by 
the Illinois Supreme Court are well-founded.  
Approval of the plaintiff’s cause of action, however, 
would mean that therapists generally, as well as other 
types of counselors, could be subject to suit by any 
nonpatient third party who is adversely affected by 
personal decisions perceived to be made by a patient 
in response to counseling.  This result would, we 
believe, place therapists in a difficult position, 
requiring them to answer to competing demands and to 
divide 
their 
loyalty 
between 
sharply 
different 
interests.  Concern about how a course of treatment 
might affect third parties could easily influence the 
way in which therapists treat their patients.  Under a 
rule imposing a duty of care to third parties, 
therapists 
would feel 
compelled 
to consider the 
possible effects of treatment choices on third parties 
and would have an incentive to compromise their 
treatment because of the threatened liability.  This 
would 
be 
fundamentally 
inconsistent 
with 
the 
therapist’s obligation to the patient . . . to the 
patient’s ultimate detriment.  
Doe v. McKay, 700 N.E.2d 1018, 1023-24 (Ill. 1998).  The mere 
threat of a lawsuit may ultimately hinder beneficial treatment 
by therapists and/or counselors. 
¶85 The majority also dismisses the doctors’ concerns 
about confidentiality between a therapist and patient due to 
Anneatra’s death.  However, in the next case, the defendant(s) 
may be presented with a different situation, one in which the 
therapist cannot properly defend himself or herself without 
revealing confidences disclosed in sessions.  All communications 
97-1969.jpw 
 
3 
between a patient and his or her therapist are privileged and 
are subject to limited disclosure.  Wis. Stat. § 905.04(2), (3) 
and (4)(c) (except when patient’s physical, mental or emotional 
condition is raised as an element of a patient’s claim or 
defense).  
¶86 As the United States Supreme Court has recognized, 
effective therapy “depends upon an atmosphere of confidence and 
trust” in which the patient is willing to completely disclose 
facts, emotions, memories and fears, generally of a very 
sensitive 
nature. 
 
Jaffee 
v. 
Redmond, 
518 
U.S. 
1, 
10 
(1996)(extending 
therapist 
privilege 
to 
social 
workers).  
Disclosure of such sessions may cause embarrassment or disgrace, 
and “the mere possibility of disclosure may impede development 
of the 
confidential relationship 
necessary 
for 
successful 
treatment.”  Id.   
¶87 By allowing third-party actions against therapists, 
patients may be faced with a difficult choice between preserving 
the 
confidentiality 
of 
patient-therapist 
communications 
or 
assisting the therapist in responding to the action.  “The 
[physician-patient] privilege serves the public interest by 
facilitating 
the 
provision 
of 
appropriate 
treatment 
for 
individuals suffering the effects of a mental or emotional 
problem.  The mental health of our citizenry, no less than its 
physical health, is a public good of transcendent importance.”  
Id. at 11.  Because of the strong public interest in effective 
treatment, 
and in 
maintaining confidentiality 
between the 
97-1969.jpw 
 
4 
therapist-patient, I believe we must be cautious in imposing a 
broad duty of care toward third parties.   
¶88 For the foregoing reasons, I concur. 
97-1969.awb 
 
1 
 
¶89 ANN WALSH BRADLEY, J. (Dissenting).   For the reasons 
set forth in the concurrence, I respectfully dissent.  The 
concurrence and I part company when it portrays the majority 
opinion as narrowly written.  Concurrence at 1.  I read the 
majority opinion as a significant change of the law under the 
guise that it is unique to the facts of this case. 
¶90 In arriving at its conclusion, the majority faces a 
substantial problem:  how to get around Wells Estate v. Mt. 
Sinai Medical Center, 183 Wis. 2d 667, 515 N.W.2d 705 (1994).  
This court in Wells Estate refused to recognize a parent’s claim 
for the loss of an adult child’s society and companionship.  Id. 
at 675.  That is exactly the clam that the Sawyers would like to 
have argued.  Instead, they engaged in creative pleading to 
circumvent Wells Estate and create a new claim recognized by the 
majority:  third-party professional negligence claim, not based 
on personal relationship, limited to the pain and suffering and 
loss of enjoyment of life that arises as a result of being 
falsely accused by a therapist’s patient of committing sexual 
abuse on that patient.  Majority op. at 13. 
¶91 The majority’s need to distinguish the prohibition in 
Wells Estate from the present cause of action leads it to remove 
the 
limitation 
that 
the 
claim 
be 
based 
on 
a 
personal 
relationship. 
 
Under 
the 
majority 
opinion 
any 
claimant, 
regardless of the existence or non-existence of relationship, 
can dress up a loss of society and companionship claim as a 
97-1969.awb 
 
2 
claim for pain and suffering through creative pleading and 
proceed with a valid cause of action.   
¶92 Since there is no limitation based on personal 
relationship, under the facts of this case Anneatra’s brother, 
her uncle, her grandfather, her aunt, her cousins, and two 
priests could also bring a claim.  Moreover, since there is no 
limitation based on personal relationship, under the facts of 
the next case, a criminal defendant charged with sexually 
assaulting the patient, an abusive former boyfriend of the 
patient, or a host of others could also maintain an action 
against the therapist.  Under the majority opinion, all that 
these individuals would need to claim is that they were 
inflicted by pain and suffering and loss of enjoyment of life 
when a patient under the treatment of a therapist falsely 
accused them of sexual assault. 
¶93 Although the majority indicates by its holding that 
this newly recognized cause of action applies only to harm 
arising out of allegations of sexual abuse, such a limitation is 
unconvincing.  There is no rational basis to distinguish between 
sexual abuse and physical abuse.   
¶94 The majority avows to so narrowly tailor the claim 
that it carves a niche out of the law that is only large enough 
to include the unique set of facts from the case at hand.  Yet, 
it fails to do so.  Instead it crafts a claim that is without 
limitation to relationship and which cannot be narrowed to just 
accusations of sexual abuse.  As the saying warns, “Once the 
camel’s nose is in the tent the rest is sure to follow.”  Rather 
97-1969.awb 
 
3 
than limiting the scope of the claim, the majority leaves it 
wide open.  Accordingly, I dissent.