Court Opinion

ID: 9670027
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:12:49.647401+00
Date Added: 2024-06-11T18:16:01.912311
License: Public Domain

SCHUDSON, J.
¶ 59. (concurring/dissenting). I join the majority in concluding that the trial court correctly determined that the statute of limitations defense should not be submitted to the jury, that the economic loss doctrine did not bar G&L's claims, and that the evidence supported submission of the punitive damages issue to the jury. If a new trial is required, I also agree that only the punitive damages issue needs to be retried. But I disagree with the majority's view that a new trial is needed.
I. Verdict / Waiver
¶ 60. As the majority notes, "Although the plaintiffs submitted proposed jury verdict forms containing *52two separate punitive damages questions, one for the City and the other for G&L, the trial court fashioned a verdict form which combined the amount to be awarded for punitive damages into one question." Majority at ¶ 9. WEPCO did not object. Indeed, counsel for WEPCO, arguing post-verdict motions, reiterated: "It's not a problem with the verdict form. We're not arguing there is something wrong with the verdict form."
¶ 61. Thus, in this case, we consider an extraordinary situation: (1) The plaintiffs requested verdict forms that would have required separate punitive damages verdicts. (2) The plaintiffs' request was denied. (3) WEPCO did not object to the trial court's verdict form, which merged what otherwise would have been the two separate punitive damages verdicts requested by the plaintiffs. (4) Upon return of the verdicts, WEPCO still did not object to the form of the punitive damages verdict. (5) In post-verdict motions, WEPCO still did not object to the form of the punitive damages verdict. Instead, in post-verdict motions, WEPCO maintained, for the first time, that the jury's verdict, not the verdict form, required a new trial. But, of course, the verdict and the verdict form were inextricably connected. Simply stated, the jury could not have returned the punitive damages verdict WEPCO belatedly challenged had the trial court segmented the punitive damages verdicts as the plaintiffs originally requested.
¶ 62. Nevertheless, according to the majority, WEPCO, despite having agreed to the merged punitive damages verdict form, and despite never objecting to that form when the verdict was returned and the jury could have been re-instructed and ordered to deliberate further, now gains a new trial where, presumably, the verdict forms the plaintiffs originally requested will be required. That, to say the least, is ironic.
*53¶ 63. Moreover, the majority's decision is inconsistent with Wisconsin case law on waiver. In State v. Aimee M., 194 Wis. 2d 282, 533 N.W.2d 812 (1995), the appellant, the mother of three children subject to a CHIPS proceeding, failed to object at trial to the single-question verdict form combining the several jurisdictional bases ’ alleged in the CHIPS petition. Id. at 286-87. On appeal, however, she "raise[d] a question whether the form of the verdict deprived her of her statutory right to a five-sixths verdict." Id. at 295. The supreme court held that although the mother "did not preserve the objection for appeal," a new trial was required "in the interest of justice" because "the form of the verdict misled the jury." Id. at 287. The supreme court explained:
[Although, as a general rule, failure to object to a jury instruction in timely fashion constitutes waiver of the objection, when matters, such as this, which go directly to the integrity of the fact[-]finding process, are raised on appeal, the rule is not inflexible and admits of exceptions. Here, petitioner's objection goes directly to the integrity of the fact-finding process because she contends that she is entitled to a five-sixths verdict on each jurisdictional ground alleged and for which evidence is adduced at trial. By asking the jury to answer only one question when multiple bases for jurisdiction have been alleged, she contends there is no assurance that five-sixths of the jurors agreed to each basis for jurisdiction. Accordingly, we conclude that it is appropriate to consider the merits of her argument.
Id. at 295-96 (emphases added; citation omitted).
¶ 64. Here, however, the challenged question did not go "directly to the integrity of the fact-finding process." See id. at 296. As the United States Supreme Court recently explained, " 'Unlike the measure of ac*54tual damages suffered, which presents a question of historical or predictive fact, the level of punitive damages is not really a "fact" "tried" by the jury.'" Cooper Indus., Inc. v. Leatherman Tool Group, Inc., 532 U.S. 424, 687 (2001) (citation omitted). Accordingly, the "general rule" of waiver applies. See Aimee M., 194 Wis. 2d at 295.
¶ 65. Thus, certain propositions are undeniable:
(1) Generally, failure to object at trial to an alleged five-sixths verdict violation waives appellate challenge. See id. at 295.
(2) Despite waiver, an appellate court may order a new trial as a result of a five-sixths verdict violation when the violation goes "directly to the integrity of the fact-finding process." See id.
(3) Here, WEPCO failed to object at trial to the alleged five-sixths verdict violation.
(4) Here, the alleged five-sixths verdict violation related only to WEPCO's punitive damages; it did not "go directly to the integrity of the fact-finding process." See id.; see also Cooper Indus., 121 S. Ct. at 1686.
(5) Here, therefore, waiver applies.
Accordingly, WEPCO, the offending party who repeatedly failed 'to object to the five-sixths verdict form and verdict when they could have been corrected, should not gain a new trial.
II. Verdict / The Merits
¶ 66. The majority maintains, however, that Aimee M. does not control, and that "the facts here fall squarely within the Seif and Westfall rule" that "per*55mit[s] a party to raise an objection to the erdict for the first time in the motions after verdict." Majority at ¶ 34. I disagree. I believe that Aimee M. comes closest to the instant case. Seif v. Turowski, 49 Wis. 2d 15, 181 N.W.2d 388 (1970), and Westfall v. Kottke, 110 Wis. 2d 86, 328 N.W.2d 481 (1983), dealing with "irreconcilable" and "inconsistent" verdicts, have only the slightest tangential relationship to the issues of this appeal. (In fact, if anything, WEPCO's arguments are undermined by West-fall, where the supreme court did not need to address any issue resulting from the five-sixths violation precisely because, "upon return of the verdict," the trial court "immediately re-instructed the jury and gave the jury the opportunity to reconsider its action." Westfall, 110 Wis. 2d at 98.)
¶ 67. But even if, as the majority maintains, "the Seif and Westfall rule" applies (and it is undisputed that Seif and Westfall allow for appellate consideration of a challenge to verdicts even when no objection is made until post-verdict motions), then, under Seif and West-fall, we would be considering not whether a five-sixths verdict violation occurred, but rather, whether the verdicts were fatally inconsistent.
¶ 68. "When reviewing a jury verdict to determine whether it is fatally inconsistent, [we] will uphold the verdict when the record is such that the jury could have made both of the findings that are claimed to be inconsistent." See Sharp v. Case Corp., 227 Wis. 2d 1, 20, 595 N.W.2d 380 (1999). Here, the jury could have done so. As the trial court, denying WEPCO's postver-dict motions, explained:
A timely objection would have.. .’ permitted the Court to consider the positions now urged by the defendant and, if appropriate, take steps to remediate *56the problem; but the defendant did not make any objection, and such action must be deemed a waiver.
Either the defendant consciously decided not to object[,] to save an objection for post-verdict motions, or the defendant agreed with the Court that the verdict was not defective. In either event, the objection is now to no avail. Failure to object at the proper time constitutes waiver.
But more significantly, I think it's the latter option because there is no fatal defect. Despite the defendant's argument to the contrary, the dissent of Juror C to Question 21 does not mean that juror did not agree that punitive damages should be awarded. Indeed, given the wording of that question and the wording of Questions 19 and 20,.. . what we do know is the juror found that the defendant did act in an intentional disregard of the plaintiffs' rights. There were no dissents to either of those questions.

Question 21 asked as to the amount to be awarded, and we can only speculate whether Juror C contended a greater or lesser amount was appropriate; thus, there was no dissent as to whether punitive damages shov Id be awarded.

Moreover, in reality there was only one dissent on any substantive question.

Here[,] although there were dissents to Questions 1 and 2, there were no dissents with respect to the questions concerning the plaintiffs' substantive claims of waste, negligence, trespass, et cetera. On each of these questions, all 14 jurors with the one exception were unanimous. Each time the jurors were asked to assess the evidence and each time they were unanimous in their conclusion. There is no fatal flaw.
*57(Emphases added.) The trial court was correct. Clearly and logically, therefore, the verdicts can be reconciled. Accordingly, even reverting to and applying what the majority terms "the Seif and Westfall rule," we should conclude that no new trial is needed.
¶ 69. The majority notes that, in Seif, the supreme court observed that where" 'the resolution of the inconsistency requires an extensive review of the evidence, the matter may well be considered more judiciously in motions after verdict.'" Majority at ¶ 32. That, of course, is beyond dispute. Here, however, the trial court correctly concluded that the verdicts could be reconciled. Moreover, the supreme court, in allowing that the issue of inconsistent verdicts "may" be considered in motions after verdict, see Seif, 49 Wis. 2d at 21, certainly was not encouraging counsel to postpone their objections. After all, as most experienced trial lawyers and judges would warn, precisely because complicated cases tend to generate long and costly trials, trial courts and counsel should be all the more careful in reviewing verdicts when they are returned — when any problems can be addressed — so that long and costly retrials will not be needed. The majority's rule reverses the incentives for careful and cost-effective litigation.
III. Additional Concerns
¶ 70. The majority correctly observes, "Had the trial court not sua sponte combined the separate punitive damages questions into one, there may well have been a valid punitive damages verdict as to G&L," because no jurors dissented on the verdict finding WEPCO liable to G&L. Majority at ¶.41. Conceivably, therefore, the City and G&L could disagree on how much of the $100,000,000 punitive damages goes to each; but that would be their dispute, not WEPCO's. *58Punitive damages are for punishment and deterrence. See Brown v. Maxey, 124 Wis. 2d 426, 439-40, 369 N.W.2d 677 (1985) (" 'Punitive damages are properly-denominated "smart money" and are designed to hurt in order to punish and deter.'" (alteration and quoted source omitted)). Whether the punitive damages go to one victim or the other is incidental unless the victims complain. A retrial on punitive damages throws out the victims' innocent babies with WEPCO's toxic bath water.
¶ 71. Accordingly, although I concur on certain issues, I conclude that no new trial is needed and, therefore, I also respectfully dissent.1

 Although I also agree with the majority's conclusion that the trial court erred in ordering, as a sanction, that WEPCO must not pursue insurance coverage for the punitive damages award, I do not join in the balance of the majority's discussion of the other sanctions. These additional sanctions, however, need not be addressed if, as I have concluded, no new trial would be required.
Still, I do note that the majority has addressed a particularly intriguing issue that would have a significant bearing on any punitive damages retrial — whether evidence of insurance coverage for punitive damages is inadmissible. Thus, I also offer some thoughts that, hopefully, will aid the analysis should this appeal find further review.
The majority maintains that the rule precluding "[elvidence that a person was or was not insured against liability ... upon the issue whether the person acted negligently or otherwise wrongfully," under Wis. Stat. § 904.11, encompasses punitive damages and that the statute's rationale "applies as well to punitive damages questions." Majority at ¶ 48. Perhaps, but in at least three ways, the majority's conclusion may stand on shaky ground.
First, the majority maintains that the rationale for Wis. Stat. § 904.11 — "the legislature's concern in preventing a jury *59from knowing of any liability insurance is that the jury may be swayed by the existence of insurance, sensing a greater ability to pay, when considering damage questions," Majority at ¶ 48— applies to punitive damages. But why? Punitive damages punish and deter. In determining the amount of punitive damages, a jury attempts to punish and deter the offending party (and deter others, perhaps), not the party's insurer. Thus, introduction of evidence of insurance for punitive damages may be admissible, serving "another purpose," under Wis. Stat. § 904.11. See Gerald R. Powell and Cynthia A. Leiferman, Results Most Embarrassing: Discovery and Admissibility of Net Worth of the Defendant, 40 Baylor L. Rev. 527, 532 (1988) ("Only by informing the jury that the defendant pays punitive, but not actual damages, would the purported goal [of punishment] be achieved."); see also 23 Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 5364 (1980) (federal rule barring evidence of insurance "does not prohibit the use of evidence of insurance where it is relevant to the question of. . . punitive damages"); Ayers v. Christiansen, 564 P2d 458, 461 (Kan. 1977) ("Evidence of the defendant's financial condition — of which insurance was a part — was relevant to punitive damages.) And whether such evidence is admissible also may depend on whether it is offered in a case-in-chief, or in rebuttal. See, e.g., Wheeler v. Murphy, 452 S.E.2d 416, 423-24 (W. Va.1994).
Second, the majority maintains that "insurance coverage is not evidence of wealth." Majority at ¶ 49. Why not? If a jury intends to award punitive damages to punish and deter a party, it needs to know the party's wealth in order to do so fairly. No doubt every juror, in order to punish fairly, would want to know the extent to which the punished party can divert the punitive damages to an insurer. Indeed, Wis JI — Civil 1707.1, provides, in part:
If you determine that punitive damages should be awarded, you may then award such sum as will accomplish the purpose of punishing or deterring wrongful conduct.
*60Factors you should consider in answering this question include:
4. the defendant's ability to pay. You may consider the defendant's wealth in determining what sum of punitive damages will be enough to punish the defendant and deter the defendant and others from the same conduct in the future.
Third, the majority maintains that the City and G&L "were not prejudiced by the lack of candor or investigation done by WEPCO in entering into a stipulation that no punitive damages coverage was available" because "no evidence of WEPCO's punitive damages insurance coverage would have gone to the jury." Majority at ¶ 53. But here, the majority simply is confused. In this trial, evidence of insurance — i.e., inaccurate evidence of reoninsurance — was introduced. See Powell and Leiferman, 40 Baylor L. Rev. at 536 ("Lack of insurance should be viewed, then, just as any other net worth evidence. It is little different from proving that a defendant has no money in the bank, no accounts receivable, or no physical assets."). Logically, that evidence of noransurance would have led the jury to reduce the punitive damages it would have awarded had it known that WEPCO would be able to divert the punitive damages to its insurers.
The majority acknowledges that "no case addresses this issue in Wisconsin." Majority at ¶ 49. Accordingly, I would hope that if the supreme court concludes that, despite WEPCO's waiver, a new trial on punitive damages is required, it also will consider what may be the very sound theories countering the majority's analysis of the admissibility of evidence of insurance coverage for punitive damages.