In Schroeder v. Zurich American Insurance Co. (2018AP1737), the Court of Appeals District IV dismissed a personal injury case against a government contractor on the grounds of governmental immunity.

Keith Schroeder was injured when he rode his motorcycle over loose gravel on a road Fahrner Asphalt Sealers had been repairing for the Town of Fulton. Schroeder sued Fahrner for negligence. Fahrner argued it was an “agent” of the town entitled to governmental immunity under Wis. Stat. § 893.80(4).

The appeals court determined that Fahrner was a government “agent” entitled to immunity because

1. The town had approved precise specifications in the contract for the road work.
2. Fahrner conformed to those specifications.
3. There were no dangers related to the work about which Fahrner knew and failed to warn the town.

Finally, the court determined Fahrner was implementing the town’s “legislative or quasi-legislative acts” in performing the road work.

Since these elements for establishing agency for the purpose of governmental immunity applied, the court held that Fahrner was immune from liability and dismissed Schroeder’s personal injury claim.

In Moore v. Zurich American Insurance Co. (2017AP781), the Court of Appeals District I, interpreting Ohio law, held that one corporation had no duty to defend and indemnify another corporation under their contract.

Konecranes, Inc. and Badger Alloys, Inc. entered into a contract for Konecranes to perform heavy equipment lifting for sand foundry Badger. A Konecranes employee was injured during the course of the work and filed an action against Konecranes. Konecranes tendered the claim to Badger under their contract. Badger refused to indemnify.

Due to the contract’s choice of law provision, the appeals court interpreted Ohio law and ruled in favor of Badger. The court determined that the duty to defend must be express and is not implied in an indemnification provision. Since the contract between Badger and Konecranes did not contain an express duty to defend in the indemnification provision, Badger had no duty to defend.

Furthermore, Badger had no duty to indemnify Konecranes because Konecranes’s own negligence caused the injury. While Konecranes argued Badger had a duty to indemnify based on initial allegations in the employee’s complaint, the court determined that the duty to indemnify is contingent on the actual allocation of liability. Because a jury determined that Konecranes, not Badger, was negligent in the accident, Badger had no duty to indemnify.

In Town of Delafield v. Central Transport Kriewaldt (2017AP2525), the Court of Appeals District II held that federal transportation law does not preempt the town’s seasonal weight restriction on certain roads.

Delafield posted signs identifying a seasonal weight restriction prohibiting vehicles over six tons from driving on designated town roads. A Central Transport delivery truck over six tons was subsequently issued a citation for driving on one of the designated roads while making a delivery to a Delafield resident.

Federal law (U.S. Code Title 49 s. 31114(a) and Title 23 s. 658.19) requires towns provide “reasonable access” between the interstate and terminals. Central Transport argued that the federal transportation law preempts the town’s weight limit because it did not allow Central Transport reasonable access between the interstate and the place of delivery in the town.

The appeals court rejected Central Transport’s argument, stating that Delafield did allow reasonable access. Although the weight limit prohibited Central Transport from reaching the delivery location, the town had set up a permit process providing exceptions to the weight limit to companies who contact the town’s highway superintendent. The court said Central Transport was not denied reasonable access because it could have used the permit process. The court said being aware of the town’s weight limit and permit process is simply a “cost of doing business” for trucking companies.

In Hull v. Glewwe (2017AP2485), the Court of Appeals District III held that claim preclusion does not bar a plaintiff from pursuing a new negligence lawsuit when the plaintiff’s insurer has already defended the plaintiff in a previous lawsuit arising out of the same accident, wherein the plaintiff was not a named defendant.

Plaintiff Hull and defendant Glewwe were both injured in the same accident. Glewwe sued Hull’s insurer Unitrin Auto & Home Insurance Co., and that lawsuit ended in a settlement. Hull was not a named defendant in the lawsuit and did not participate in the settlement agreement. Hull subsequently filed the instant action seeking damages from Glewwe and his insurer State Farm. Glewwe argued that claim preclusion barred Hull’s action, and Hull instead should have raised his arguments as a counterclaim in the first lawsuit.

The appeals court held that claim preclusion does not bar Hull’s negligence claims because he was not a named party in the first lawsuit; therefore, Glewwe failed to satisfy the identity of parties element of claim preclusion. While Glewwe argued Hull was in privity with his defendant insurer in the first lawsuit, the court determined that Hull’s and his insurer’s interests were materially different. In the first lawsuit, the insurer had only a duty to defend Hull, not to pursue Hull’s cause of action for his own injuries. Finally, the appeals court determined that allowing Hull’s claim to proceed after the first lawsuit was settled does not contradict the direct action statute (Wis. Stat. § 632.24), which establishes that insurers are directly liable to persons entitled to recover.

The Wisconsin Insurance Alliance wrote an amicus brief in the case, arguing that allowing Glewwe’s claim preclusion defense to proceed would pose significant issues for both insurers and insureds.

In Moustakis v. DOJ (2018AP373), the Court of Appeals District III held that the public records law is constitutional as applied to elected officials.

Former district attorney Albert Moustakis was the subject of a public records request. The Department of Justice (DOJ) compiled records, which contained unsubstantiated complaints about Moustakis, and performed a weighing of interests, ultimately determining disclosure of the records was in the public’s interest.

Moustakis received a copy of the records prior to their release, then filed the instant lawsuit seeking to enjoin DOJ from releasing the records. Moustakis argued that 1) DOJ’s records custodian made an arbitrary determination and should redo the public interest balancing test, and 2) the public records law (Wis. Stat. § 19.356) is unconstitutional as applied to him in his capacity as an elected official.

The appeals court rejected both Moustakis’s arguments. First, the court determined Moustakis did not show he had a clear legal right to a writ of mandamus requiring a new balancing test. Statutes favor disclosure of records even when they contain unsubstantiated complaints, and the law does not require the records custodian to consult with the records subject before making a disclosure determination. Therefore, the DOJ records custodian was acting within his discretionary power and did not make an arbitrary determination to release the records.

Second, the court determined that the public records law is constitutional as applied to Moustakis in his capacity as an elected official. Wis. Stat. § 19.356 provides that authorities need not notify record subjects before release; however, the statute does have an exception for public employees. Moustakis argued this exception offered to public employees and not elected officials violates his constitutional equal protection rights. The court determined that the statute did not violate Moustakis’s fundamental rights, so rational basis, not strict scrutiny, applied. The court agreed with DOJ that providing the public with the greatest information possible on their elected officials was a rational basis for the legislature to enact the statute distinguishing between public employees and elected officials. Therefore, the public records law is constitutional as applied to Moustakis.