In Vande Corput v. Pekin Insurance Co. (2017AP357), the Court of Appeals District III ordered recalculation of attorney fees and maintained that circuit courts can mandate settlement agreements in third-party liability worker’s compensation disputes.

After Jody Vande Corput was injured in a car accident during his employment, Continental Western Insurance Co. paid him worker’s compensation benefits. Vande Corput and his wife filed a third-party liability lawsuit against the other driver’s insurer Pekin Insurance Co. Continental was added as an involuntary plaintiff. The Vande Corputs and Continental settled with Pekin, leaving the circuit court to apportion settlement proceeds. The Vande Corputs appealed the circuit court’s distribution.

The appeals court agreed with the Vande Corputs and remanded the case to the circuit court to properly follow the three-step distribution process laid out by the Wisconsin Supreme Court in Anderson v. MSI Preferred Insurance Co.

The Wisconsin Association for Justice (WAJ) filed an amicus brief in this case arguing that Continental’s lawyers should not recover any fees because they did not have a written fee arrangement with Continental. However, the court disagreed with WAJ because the Supreme Court Rules WAJ cited apply in disciplinary, not civil proceedings. Furthermore, Continental and its lawyers still maintained a contract for services, and the third-party liability worker’s compensation statute (Wis. Stat. § 102.29(1)(c)) expresses clear intent that both the employee’s and the worker’s compensation insurer’s attorneys should be entitled to attorney fees in a joint third-party claim.

The appeals court also rejected the Vande Corputs’ request to mandate the circuit court to use the quantum meruit theory to determine the allocation of attorney fees to Continental’s lawyers. This theory multiplies the number of hours worked on the case by a reasonable hourly rate to determine the appropriate fees.

The appeals court further held that the circuit court could compel the Vande Corputs to accept the settlement agreement, even though it contained the unfulfilled contingency of the allocation of settlement payments. The court argued that precedent shows circuit courts can compel settlements in third-party liability worker’s compensation actions despite objections from employees or their insurers.

In Mohn v. CBS Corp. (2017AP861), the Court of Appeals District I’s per curiam decision upheld the constitutionality of the property improvements statute of repose (Wis. Stat. § 893.89); thus Sprinkmann Sons Corp. was not liable for the plaintiff’s asbestos exposure.

Mary Ellen Mohn’s husband was exposed to asbestos while working at a construction project that ended in the late 1960s. Mohn was diagnosed with cancer in 2009, and Mary Ellen subsequently filed action against manufacturers and suppliers involved in the construction, including Sprinkmann, in 2012.

Wisconsin’s statute of repose for property improvements bars liability for persons involved in property improvements after ten years (reduced to seven years by 2017 Wis. Act 235). The statute of repose does not protect manufacturers of defective materials and property owners negligent in subsequent maintenance of improvements.

Mohn argued that Sprinkmann could be considered a manufacturer of defective material because it supplied defective, asbestos-containing insulation during the construction project. However, the appeals court rejected this argument, stating that Mohn’s argument would conflate manufacturers and other persons involved in property improvements, ultimately negating the protective purpose of the statute of repose. Sprinkmann furnished but did not manufacture the asbestos-containing insulation.

Mohn further argued that the statute of repose itself is unconstitutional as-applied to asbestos exposure claims because it violates rights to remedy and equal protection. The appeals court upheld the constitutionality of the law because the statute extinguishes the entire “right by which the litigant seeks a remedy.” Furthermore, the statute does not violate equal protection rights because the distinction of a class of asbestos claims that take longer to manifest serves a “legitimate governmental interest.”

In Shawn M. Wallace v. Richard R. Woodford (2016AP2359), the Court of Appeals District III maintained that Central Mudracing Association and Chippewa Valley Antique Engine & Model Club were not negligent in a mud bog racing accident that injured plaintiff Shawn Wallace.

The appeals court denied Wallace’s argument that the court should have included evidence of a prior accident at the track. The 2005 accident was properly excluded because the circumstances were substantially different from the accident at issue, Central Mudracing took remedial action after the first accident, and the jury could draw the same inferences with or without knowing of the 2005 accident.

Wallace further argued that Central Mudracing and Chippewa Valley made improper closing arguments that indicated no previous accidents had occurred on the track. However, the appeals court held that the defense attorneys’ claims implied no similar accident had previously occurred. The closing arguments were consistent with the court’s decision to exclude the 2005 accident evidence based on dissimilarities in the circumstances.

Finally, Wallace argued the court should have included a report from an accident reconstruction specialist, but the appeals court upheld that the expert testimony failed to meet the admissibility criteria in Wis. Stat. § 907.02.