author: NETTESHEIM, J.

text:
    Robert Stuart and Lin Farquhar-Stuart, Plaintiffs-Appellants-Cross-Respondents, v. Weisflog's Showroom Gallery, Inc. and Ronald R. Weisflog, Defendants-Respondents-Cross-Appellants, American Family Mutual Insurance Co., Defendant-Respondent.†
    Court of Appeals

      No. 2005AP886.

      Submitted on briefs February 17, 2006.

      Decided May 3, 2006.

    2006 WI App 109
    (Also reported in 721 N.W.2d 127.)

      On behalf of the plaintiffs-appellants-cross-respondents, the cause was submitted on the briefs of Roy E. Wagner and Matthew R. Jelenchick, of Niebler, Pyzyk, Klaver & Wagner, L.L.R, of Menomonee Falls.
    On behalf of the defendants-respondents-cross-appellants, the cause was submitted on the brief of James C. Ratzel and Joya J. Santarelli, of Ratzel and Associates, L.L.C., of Brookfield.
    On behalf of the defendant-respondent American Family Mutual Insurance Company, a brief was filed by Paul J. Pytlik and Michelle M. Stoeck, of Hills Legal Group, Ltd., of Waukesha.
    Before Snyder, PJ., Brown and Nettesheim, JJ.

       Petition to review granted 12-6-06.

   NETTESHEIM, J.

¶ 1. We-address a novel question in this case and hold that Wis. Stat. § 100.20(5) (2003-04) authorizes doubling of an entire damage award when a violation of the Home Improvement Practices Act, Wis. Admin. Code ch. ATCP 110 (Oct. 2004) (ATCP 110), is coupled with additional wrongdoing, separate and apart from the § 100.20/ATCP 110 violation, which contributes to the loss.

¶ 2. A jury found that Weisflog's Showroom Gallery, Inc., (the Gallery) induced Robert Stuart and his wife, Lin Farquhar-Stuart, to enter into an architectural contract and a subsequent remodeling contract by false, deceptive or misleading trade practices contrary to Wis. Admin. Code ATCP § 110.02. The jury further found that the Gallery had negligently performed the construction called for in the remodeling contract. The jury awarded the Stuarts $95,000 and apportioned 25% to the ATCP 110 misrepresentations and 75% to the negligence. Postverdict, the trial court doubled only the misrepresentation damages and, fashioning a formula derived from that logic, awarded attorney fees of $15,675, well short of the $200,000 in fees the Stuarts had sought. The Stuarts appeal the trial court's inclusion of the damage apportionment question on the special verdict and the court's refusal to submit a question as to Ronald Weisflog's personal liability. The Stuarts also appeal the attorney fee award.

¶ 3. Weisflog and the Gallery cross-appeal. They claim that the Stuarts' action was barred by the statute of limitations governing contract actions and otherwise was barred by the economic loss doctrine. They also challenge several evidentiary rulings of the trial court and the structure of the special verdict. Finally, Weis-flog contends that he was a "prevailing party" and should have been awarded costs.

¶ 4. We affirm the judgment as it relates to the cross-appeal. We hold that the action is not time-barred, as the Stuarts' claims are statutory and tort based, not contract-based. We also hold that the economic loss doctrine does not apply because the core agreement between the parties was one for services within the meaning of Insurance Co. of North America v. Cease Electric Inc., 2004 WI 139, 276 Wis. 2d 361, 688 N.W.2d 462. Finally, we do not address the remaining cross-appeal issues because the Weisflog parties have failed to support their arguments with necessary cites to the record and have otherwise conceded the issues by failing to respond in their reply brief to the Stuarts' arguments in their cross-respondent's brief.

¶ 5. However, as to the issues the Stuarts raise on appeal, we reverse. We hold that the apportionment of damages between the Gallery's ATCP 110 violations and its negligence was error and that pursuant to Wis. Stat. § 100.20, the Stuarts are entitled to twice the full measure of their damages. We remand for the entry of judgment to reflect the doubling of the damages. From that, it follows that we must also reverse the attorney fees award since the award was based, at least in part, on the apportionment of the damages. We remand for a redetermination of the Stuarts' attorney fees.

¶ 6. In addition, under Rayner v. Reeves Custom Builders, Inc., 2004 WI App 231, 277 Wis. 2d 535, 691 N.W.2d 705, review denied, 2005 WI 60, 281 Wis. 2d 114, 697 N.W.2d 472, we hold that the trial court erred in excluding from the verdict a question as to Weisflog's personal liability. We remand for a retrial of that limited question.

FACTS

¶ 7. Weisflog is a home builder/remodeler. In 1995, the Stuarts met with Weisflog to discuss the design and construction of a sizeable addition to their existing home in the City of Brookfield. Weisflog testified that for an architectural fee of $1000, he would consult with the Stuarts about their remodeling needs and provide them with finalized drawings and a home design. However, Weisflog also testified that he had no degree in architecture, nor a license or registration to that effect with the state, and did not recall whether he had had any licensed architect review the plans. Weisflog's son, Robert, was the project manager. Robert also is not degreed or licensed in architecture.

¶ 8. Following these consultations, the Stuarts entered into a "Remodeling Architectural Contract" (Architectural Contract) in November 1995 with the Gallery for the design and drawings of the addition. Weisflog was listed as the salesperson. The Architectural Contract required the Stuarts to pay a $1000 "remodeling architectural fee." The drawings provided by Weisflog to the Stuarts state, "Drawn by Ronald and Robert Weisflog." Neither Weisflog nor anyone working for the Gallery was a licensed architect. The plans list as the provider "Weisflog's Showroom Gallery," but do not include "Inc." or any corporate reference.

¶ 9. With the Architectural Contract in place, the Stuarts then entered into a second contract in May 1996 designated the "Remodeling Contract." The contract price totaled approximately $278,000. The Remodeling Contract generally laid out the work to be done, with many items listed as being "per plan." Drafted on stationery bearing the logo "Weisflog Homes Specialty Drywalling & Repairs," it made no reference to the Gallery or any corporate entity. The contract was signed by Robert Weisflog. The parties dispute whether Weisflog himself was present at the signing. According to the Stuarts, Weisflog professed familiarity with local code requirements and assured the Stuarts that the home would be built in compliance with them. The jury heard testimony from Weisflog, however, that he was unfamiliar with certain aspects of the code and from Robert Weisflog that he "[didn't] even know that there's a Brookfield code .... I don't think there is such a thing."

¶ 10. In due course, the Gallery constructed and completed the addition to the Stuart residence. Sometime in 2001, Robert Stuart was in the new hot tub room when his foot went through a soft spot in the floor. He pulled back the carpeting, exposing a "rotted hole." Further investigation revealed that the room's windowsills also were warping and rotting. The Stuarts engaged a professional engineer/home inspector whose examination revealed numerous other serious construction defects and building code violations, some unobservable before that because of their location in the attic or other inaccessible places.

¶ 11. The Stuarts then commenced this action against Weisflog personally and the Gallery, alleging negligence in the design and construction of the addition to their home. The Stuarts later amended their complaint to allege breach of contract and ATCP 110 violations against the Weisflog parties.

¶ 12. Twice Weisflog unsuccessfully moved for partial summary judgment seeking dismissal of the claims against him in his individual capacity. The second summary judgment motion also requested dismissal of the contract claims against the Weisflog parties. An interlocutory petition to the court of appeals seeking review similarly failed.

¶ 13. At the outset of the jury trial, the Stuarts dismissed their breach of contract claims and proceeded on the remaining theories of negligence and the ATCP 110 misrepresentations. The Stuarts' witnesses included a licensed architect who testified that the architectural plans were deficient, incomplete and did not follow the applicable building codes. The architect's report stated that the plans showed that "major areas of construction are missing or devoid of detail.... [and] [t]he plans are deficient in many other respects based on accepted standard architectural practices."

¶ 14. The Stuarts also introduced the inspection report prepared by their engineer/home inspector. This report detailed various examples of the work not being completed per the plans and specifications, as well as numerous code violations such as improper ventilation; venting of the clothes dryer into the attic; lack of access to the attic and to mechanical, electrical and plumbing items; improper clearance to floor joists; and improper surface drainage. The Weisflog parties' defense expert later agreed with the inspector's conclusion that the damage was so significant that demolishing and rebuilding the hot tub room would be more prudent than repairing it.

¶ 15. The Stuarts also presented the testimony of a certified indoor environmentalist who stated that he found mold growing in a number of locations, some in "very high concentrations," and some of it of the type Stachybotrys, commonly known as "toxic mold." The remediation of this condition called for physical removal of the mold, cleaning the contaminated surfaces and purifying the air at a cost of between approximately $7500 and $9500. Demolition and rebuilding the project was projected to cost $96,300.

¶ 16. Following the close of the evidence, the trial court and the parties addressed the form of the special verdict. The Stuarts sought to include questions pertaining to Weisflog's alleged personal liability, but the court rejected the request. In addition, over the Stuarts' objections, the court included a question requested by the Weisflog parties which asked the jury to apportion the damages between any negligence and any ATCP 110 misrepresentations committed by the Gallery.

¶ 17. The jury found that the Gallery was negligent in both the design and construction of the project. It also found that the Gallery had engaged in false, deceptive or misleading representations to induce the Stuarts to enter into both the Architectural Contract and the Remodeling Contract. The jury awarded damages in the amount of $95,000 and, pursuant to the directions in the special verdict, apportioned 25% of the damages to the Gallery's ATCP 110 misrepresentations and 75% to the Gallery's negligence.

¶ 18. Postverdict, the trial court fashioned an attorney fee award formula based partly on the apportionment, ordered double damages for that portion of the damages attributable to misrepresentation, awarded costs to the Stuarts in the amount of $19,683, and denied the remainder of the parties' numerous motions after verdict. This appeal and cross-appeal followed.

CROSS-APPEAL ISSUES

1. Statute of Limitations

¶ 19. We address the cross-appeal first because some of the issues could be dispositive. The Weisflog parties have consistently maintained that, at its heart, this case is a claim for breach of contract. Based on this premise, the Weisflog parties contend that they were entitled to partial summary judgment because the Stuarts' ATCP 110 claims were time barred by the statute of limitations applicable to contract actions. They reason that the Stuarts' ATCP 110 claims do not exist independently of the Architectural Contract and the Remodeling Contract, and that the damages are contract-based because "the ATCP code merely adds penalty provisions to what is already a breach of contract action."

¶ 20. Determining the appropriate statute of limitations is, in essence, a question of statutory construction and subject to de novo review. See Krahenbuhl v. Wis. Dentistry Examining Bd., 2004 WI App 147, ¶ 19, 275 Wis. 2d 626, 685 N.W.2d 591. Our review of a trial court's summary judgment decision also is de novo because we apply the same methodology as the trial court. Van Erden v. Sobczak, 2004 WI App 40, ¶ 8, 271 Wis. 2d 163, 677 N.W.2d 718. Summary judgment must be granted if the evidence demonstrates no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Id., ¶ 9; Wis. Stat. § 802.08(2). Summary judgment methodology is well established and need not be repeated here. See, e.g., Lambrecht v. Estate of Kaczmarczyk, 2001 WI 25, ¶¶ 20-24, 241 Wis. 2d 804, 623 N.W.2d 751.

¶ 21. The trial court rejected the Weisflog parties' statute of limitations claim on two grounds: (1) a disputed issue of material fact existed as to when the work was completed and (2) not all of the Stuart's claims were contract-based. We need not address the first portion of this ruling since the Stuarts' voluntarily dismissed the breach of contract claims at the outset of the jury trial.

¶ 22. That leaves us with the second portion of the court's ruling — that the ATCP 110 claims were not contract-based. As noted, the Weisflog parties contend that the ATCP code merely adds penalty provisions to an existing breach of contract claim. From this premise, they argue that the limitations period should be measured from the date of the breach of the contract. See CLL Assocs. Ltd. P'ship v. Arrowhead Pacific Corp., 174 Wis. 2d 604, 609, 497 N.W.2d 115 (1993). The Stuarts respond that their ATCP 110 claims are based on statutory and administrative code provisions, and, as such, stand independent of any potential breach of contract claims. Given the "tort flavor" of a ATCP 110 misrepresentation claim, the Stuarts argue that the limitations period should be measured under the discovery rule applicable to tort actions. See CLL Assocs., 174 Wis. 2d at 609. In addition, they contend that the discovery rule applicable to tort actions should apply because violations of ATCP 110 constitute a basis for imposing civil liability. See, e.g., McGarrity v. Welch Plumbing Co., 104 Wis. 2d 414, 418, 312 N.W.2d 37 (1981) (stating that the violation of a legislative or quasi-legislative enactment is negligence per se). "[W]hen the legislature or an administrative agency prescribes what particular acts shall or shall not be done, the statute or rule may be interpreted as establishing a standard of care, 'deviation from which constitutes negligence.'" Id. (citation omitted).

¶ 23. Wisconsin case law has articulated a framework for analyzing whether a given statutory rule violation provides a basis for imposing civil liability. See Taft v. Derricks, 2000 WI App 103, ¶¶ 2, 12, 235 Wis. 2d 22, 613 N.W.2d 190. Negligence per se will be found to exist if all three of these questions are answered affirmatively: (1) Was the harm inflicted the type the statute was designed to prevent, (2) was the person injured within the class of persons sought to be protected, and (3) is there some expression of legislative intent that the statute become a basis for the imposition of civil liability. See Antwaun A. v. Heritage Mut. Ins. Co., 228 Wis. 2d 44, 66-67, 596 N.W.2d 456 (1999).

¶ 24. Wisconsin Admin. Code ch. ATCP 110 is entitled "Home Improvement Practices," and was adopted under authority of Wis. Stat. § 100.20, the fair trade practices statute. The note set prominently at the beginning of ch. ATCP 110 reads:

This chapter is adopted under authority of s. 100.20(2), Stats., and is administered by the Wisconsin department of agriculture, trade and consumer protection. Violations of this chapter may be prosecuted under s. 100.20(6), 100.26(3) or (6), Stats. A person who suffers a monetary loss because of a violation of this chapter may sue the violator directly under s. 100.20(5), Stats., and may recover twice the amount of the loss, together with costs and reasonable attorneys' fees.

¶ 25. Wisconsin courts have discussed on several occasions the policies that underlie Wis. Stat. § 100.20(5). See, e.g., Shands v. Castrovinci, 115 Wis. 2d 352, 358, 340 N.W.2d 506 (1983), and Benkoski v. Flood, 2001 WI App 84, ¶ 17, 242 Wis. 2d 652, 626 N.W.2d 851. The awarding of double damages and attorney fees encourages those injured by unfair trade practices that violate the administrative regulations to bring forward their causes of action. Benkoski, 242 Wis. 2d 652, ¶ 17. Statutory remedies also encourage individuals to act as private attorneys general in enforcing their individual rights, with the aggregate effect of these individual actions working to enforce the public's rights. Id. Private actions augment enforcement of the administrative regulations by the Department of Justice, which has insufficient resources to prosecute all violations. Id. The statutory remedies deter conduct that violates administrative regulations because they subject the violator to double damages, attorney fees and costs. Id.

¶ 26. Here, the jury agreed with the Stuarts' assertion that they were the victims of false, deceptive and misleading representations that induced them to enter into both the Architectural Contract and the Remodeling Contract. The Gallery misrepresented that the Stuarts were purchasing quality architectural services, when in fact no architectural entity prepared or reviewed the plans, and that the drawings were done according to all applicable codes, when that, too, proved false. This harm is the very type that ATCP 110 was designed to prevent. The Stuarts, as owners of a home to which a home improvement contract pertained, were within the class of persons that Wis. Stat. § 100.20(5) and ATCP 110 seek to protect, and there is a clearly expressed legislative intent that the statute provides a basis for the imposition of civil liability. These factors, coupled with the public policy underpinning both the statute and the administrative rule, convince us that violations of these provisions constitute a basis for the imposition of civil liability separate and apart from any breach of contract. As such, the discovery rule covering tort claims applies in this case.

¶ 27. The discovery rule applies for all tort actions other than those already governed by a legislatively created discovery rule. Hansen v. A.H. Robins Co., 113 Wis. 2d 550, 560, 335 N.W.2d 578 (1983). Such claims accrue on the date the injury is discovered or with reasonable diligence should have been discovered, whichever occurs first. Id. The Stuarts discovered the rot in 2001, and filed suit in 2003, well within the six years prescribed by Wis. Stat. § 893.52. The Stuarts' ATCP 110 claims were not time barred.

2. Economic Loss Doctrine

¶ 28. The Weisflog parties attack the judgment from another, but still contract-based, angle. They assert that the Stuarts' claims are barred by the economic loss doctrine (ELD) because all claims arise out of the parties' contracts. They also contend that the Remodeling Contract was a contract for the sale of a product, not services, and therefore falls within the ELD. We disagree because we deem the Architectural Contract the pivotal and controlling agreement, and one that clearly was a contract for services and therefore not governed by the ELD.

¶ 29. The ELD is a judicially created doctrine that, seeks to preserve the distinction between contract and tort. Daanen & Janssen, Inc. v. Cedarapids, Inc., 216 Wis. 2d 395, 403-04, 573 N.W.2d 842 (1998). Basic to the doctrine is the understanding that, in the commercial arena, contract law is better suited than is tort law for dealing with damages that are purely economic. Id. Economic damages are those arising because the product does not perform as expected, including damage to the product itself or monetary losses caused by the product. Linden v. Cascade Stone Co., 2005 WI 113, ¶ 6, 283 Wis. 2d 606, 699 N.W.2d 189. Ascertaining whether the contract here is one for products or services, and applying the ELD to a set of facts both present questions of law subject to our independent review. Cease Elec., 276 Wis. 2d 361, ¶¶ 14, 15.

¶ 30. The Weisflog parties argue that we should discern the nature of the contract via the "predominant purpose test." Linden, 283 Wis. 2d 606, ¶¶ 18-25. This test assesses whether, based on the totality of the circumstances, a mixed contract is mainly for goods or for services. Id., ¶¶ 8, 22. We disagree with this approach under the facts of this case.

¶ 31. The jury found that the Gallery induced the Stuarts through misrepresentations to enter into the Architectural Contract. True, a substantial amount of physical product was generated by the remodeling project pursuant to the Remodeling Contract. But the Architectural Contract, the parties' core — and initial— agreement, was one for design and architectural services. Without that threshold agreement, the Remodeling Contract would never have followed. As such, the Remodeling Contract was a trailer agreement, implementing the drawings and plans contemplated by the Architectural Contract. Indeed, aside from a $1500 incentive in the form of a discount on the building price, the Stuarts were in no way bound to sign the Remodeling Contract with the Weisflog parties.

¶ 32. Because we view the Architectural Contract as the one driving the project, we need not engage in a mixed contract analysis. An architectural contract is one for services, see Cease Elec., 276 Wis. 2d 361, ¶ 49, and our supreme court recently enunciated the "bright line rule" that the ELD "is inapplicable to claims for the negligent provision of services." Id., ¶ 52.

¶ 33. Finally, but importantly, we recall what we have already said regarding the public policy that underpins Wis. Stat. § 100.20 and ATCP 110. These provisions encourage victims of improper home improvement projects to bring forward their causes of action as private attorneys general with the aggregate effect of enforcing the public's rights. Benkoski, 242 Wis. 2d 652, ¶ 17. Public policy dictates that consumer protection statutes and administrative rules be read in pari materia to achieve the goal of providing protection and remedies to consumers. Rayner, 277 Wis. 2d 535, ¶ 14. Section 100.20, together with ATCP 110, give no indication that the legislature intended to simply add a remedy to common law misrepresentation claims or breach of contract claims. See Kailin v. Armstrong, 2002 WI App 70, ¶ 40, 252 Wis. 2d 676, 643 N.W.2d 132 (discussing Wis. Stat. § 100.18 as a distinct cause of action); see also Orion Flight Servs., Inc. v. Basler Flight Serv., 2004 WI App 222, ¶ 25, 277 Wis. 2d 819, 692 N.W.2d 804, affirmed, 2006 WI 51, 290 Wis.2d 421, 714 N.W.2d 130 (stating that all of Wis. Stat. ch. 100 must be read as a whole).

¶ 34. To apply the ELD to properly pled and proven ATCP 110 claims would defeat the public purpose underpinning Wis. Stat. § 100.20 and the remedies provided therein.

3. Evidentiary rulings and verdict structure

¶ 35. The Weisflog parties next complain that the trial court erred by admitting certain damage evidence so prejudicial that it "poisoned the jury." They also criticize the court for not allowing the defense of contributory negligence to be included on the special verdict, citing to Lutz v. Shelby Mutual Insurance Co., 70 Wis. 2d 743, 751, 235 N.W.2d 426 (1975), for the proposition that it is error for a court to "refuse" to instruct on an issue raised by the evidence.

¶ 36. We decline to address these arguments on the merits for two reasons. First, the Weisflog parties do not direct us to those portions of the record where they objected to the allegedly prejudicial evidence or requested a contributory negligence instruction. Nor do they cite to those portions of the record where the trial court made the challenged rulings in response to such objection or request. Launching an argument unsupported by appropriate citations to the record violates Wis. Stat. Rule 809.19(1)(d) and (e). Moreover, this was a six-day tried, and the appellate record comprises nearly two thousand pages. We have no obligation either to forage through a voluminous record for facts supporting a party's contention or to consider an inadequately presented argument. Grothe v. Valley Coatings, Inc., 2000 WI App 240, ¶ 6, 239 Wis. 2d 406, 620 N.W.2d 463; see also Wis. Stat. Rule 809.83(2).

¶ 37. Second, the coup de grace is that, in the face of the Stuarts' responses to these arguments, which provides new and relevant information, the Weisflog parties' reply brief is conspicuously silent on these issues. An argument asserted by the respondent and not disputed by the appellant in the reply brief is taken as admitted. Fischer v. Wis. Patients Comp. Fund, 2002 WI App 192, ¶ 1 n.1, 256 Wis. 2d 848, 650 N.W.2d 75.

4. Denial of Costs to Weisflog

¶ 38. The final issue on the cross-appeal is whether the trial court properly denied costs to Weis-flog personally. Weisflog contends that because the jury "exonerated" him from personal responsibility, he is a prevailing defendant entitled to costs under Wis. Stat. § 814.03. Section 814.03 provides, in relevant part:

814.03 Costs to defendant. (1) If the plaintiff is not entitled to costs under s. 814.01 (1) or (3), the defendant shall be allowed costs to be computed on the basis of the demands of the complaint.
(2) Where there are several defendants who are not united in interest and who make separate defenses by separate answers, if the plaintiff recovers against some but not all of such defendants, the court may award costs to any defendant who has judgment in the defendant's favor.

Construction of a statute is a question of law subject to our de novo review. Hughes v. Chrysler Motors Corp., 197 Wis. 2d 973, 978, 542 N.W.2d 148 (1996).

¶ 39. Weisflog first argues that under Wis. Stat. § 814.03(1), the Stuarts are not entitled to costs with regard to their claims against him. We disagree. The jury found in favor of the Stuarts, entitling them to costs under Wis. Stat. § 814.01(1) ("Except as otherwise provided in this chapter, costs shall be allowed of course to the plaintiff upon a recovery"). Thus, § 814.03(1) is out of play.

¶ 40. Weisflog also asserts that he is entitled to costs under Wis. Stat. § 814.03(2). He argues that not only were his and the Gallery's interests in this lawsuit "clearly distinct," but his interests actually were adverse to his corporation's because an award against him individually would come out of his own pocket. We disagree that the Weisflog parties' interests are not united. As our recital of the facts reveals, the Weisflog parties created the proverbial "moving target" by repeatedly interchanging their individual and corporate roles in their dealings with the Stuarts, even introducing a third entity, Weisflog Homes Specialty Drywalling & Repairs, in the Remodeling Contract. Moreover, subsec. (2) imposes a second requirement besides disunity of interest. The defendants also must have "ma[d]e separate defenses by separate answers." Section 814.03(2). The Weisflog parties did not do so. Finally, we again take note that the Weisflog parties have failed to respond to the Stuarts' arguments on this issue in their cross-reply brief, thereby once more conceding the point. See Fischer, 256 Wis. 2d 848, ¶ 1 n.1.

¶ 41. We reject the Weisflog parties' cross-appeal and affirm the portions of the judgment related to the cross-appeal issues.

APPEAL ISSUES

¶ 42. We now address the Stuarts' appeal. All of the appeal issues relate to Wis. Stat. ,§ 100.20(2) and ATCP 110. We therefore begin with some general observations regarding these enactments. Section 100.20(2) authorizes the Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) to issue general orders forbidding trade practices determined by the department to be unfair. These "general orders" took shape as ATCP 110 rules regulating home improvement contractors. Section 100.20(5) creates a private cause of action for any violation of ATCP 110, and provides for recovery of twice the amount of the loss, together with costs and reasonable attorney fees. Finally, we again recall the public policy principles that we have already addressed regarding these enactments.

1. Apportionment of Damages

¶ 43. The jury determined that the Gallery made a "false, deceptive or misleading representation" to induce the Stuarts to enter into both the Architectural Contract and the Remodeling Contract and that those improper representations were a cause of the Stuarts' damage. Special Verdict Question 16B asked the jury to apportion the damages between negligence and misrepresentation. The jury determined that 75% of the $95,000 damages was due to negligence and 25% to misrepresentation. The Stuarts maintain that the trial court erred in submitting the apportionment question because it frustrates the public policy behind Wis. Stat. § 100.20 and ATCP 110. We agree.

¶ 44. A trial court has wide discretion in framing special verdict questions, provided the verdict adequately covers'the law applicable to the case. Vogel v. Grant-Lafayette Elec. Coop., 201 Wis. 2d 416, 422, 548 N.W.2d 829 (1996). We conclude that Question 16B is not consistent with the law and so represents an erroneous exercise of discretion.

¶ 45. Administrative rules and regulations are construed in the same manner as statutes. Baierl v. McTaggart, 2001 WI 107, ¶ 21, 245 Wis. 2d 632, 629 N.W.2d 277. We must faithfully give effect to legislative enactments by determining the statute's meaning, primarily through its language, which we assume expresses the legislature's intent. State ex rel. Kalal v. Circuit Court for Dane County, 2004 WI 58, ¶ 44, 271 Wis. 2d 633, 681 N.W.2d 110. We favor a construction that fulfills the intent of the statute or regulation over one that defeats its manifest object. Shands, 115 Wis. 2d at 356.

¶ 46. Wisconsin stat. § 100.20(5) provides:

100.20 Methods of competition and trade practices.
(5) Any person suffering pecuniary loss because of a violation by any other person of any order issued under this section may sue for damages therefore in any court of competent jurisdiction and shall recover twice the amount of such pecuniary loss, together with costs, including a reasonable attorney's fee. (Emphasis added.)

¶ 47. The statute plainly envisions both a private action for those injured by dishonest home improvement contractors and a definite remedy. The statute is silent, however, as to whether the doubling of damages applies to the entire amount of the pecuniary loss where other conduct by the contractor, not covered by the statute or the administrative code, contributes to the loss. We must keep in mind, however, that "remedial statutes should be liberally construed to suppress the mischief and advance the remedy that the statute intended to afford." Benkoski, 242 Wis. 2d 652, ¶ 8. Where multiple interpretations are possible, we must ascertain the underlying intent from the language in relation to the subject matter, history and the object intended to be accomplished. Baierl, 245 Wis. 2d 632, ¶ 21.

¶ 48. Trade practices are subject to extensive regulation in Wisconsin. Unscrupulous business tactics cause financial distress both to consumers and to legitimate businesspeople, because money taken by the unethical merchant is money taken from the honest one. James D. Jeffries, Protection for Consumers Against Unfair and Deceptive Business, 57 Marq, L. Rev. 559, 559 (1974). To address this concern, Wisconsin enacted consumer protection laws such as Wis. Stat. § 100.20; the DATCP in turn promulgated ATCP 110. This court has recognized that the remedies foster the policies underlying the law and rules. As we have already explained, double damages and attorney fees help dispel the reluctance of parties injured by unfair trade practices to bring forward their causes of action and help deter similar and future contractor malfeasance, with the aggregate effect of working to the public good. See Benkoski, 242 Wis. 2d 652, ¶ 17. Jeffries explained that the monetary remedy to injured parties

reflects a legislative concern for the considerable financial harm that can result from unfair or deceptive selling schemes as well as an awareness that traditional public and private remedies are often of little value in deterring consumer fraud. The restitution remedy is designed both to assure that the merchant[s are] deprived of the illegal fruits of [their] past deceptive practices and to deter illegal conduct in the future by eliminating the merchants'] expectation that [they] can profit from such activities.

Jeffries, supra, at 599.

¶ 49. These policy statements dovetail with our reading of the statutory language. Taking them together, we glean a clear intent to encourage private actions and to assess meaningful penalties so as to punish the particular wrongdoer and deter future offenders. We see no place in this framework for apportioning damages where, as here, the damages flowed from the initial misrepresentation. Had the Gallery not made its misrepresentations inducing the contracts, the Stuarts may well have not entered into the contracts in the first instance and thereby avoided the harm. In short, the misrepresentations were the catalyst for the harm. To superimpose on the statute a requirement not expressed by the legislature would run counter to the undisputed purposes of the law.

¶ 50. Accordingly, based on the statute's unqualified statement that injured parties "shall recover" twice their loss, and further based on the policies that were the genesis for that language, we conclude that the verdict question asking the jurors to apportion damages was error. The full award should have been doubled. We reverse this portion of the judgment and remand with directions that the full award be doubled.

2. Attorney Fees

¶ 51. The Stuarts next contend that the trial court erred by awarding only $15,675 in attorney fees when it found largely reasonable the documentation of the $200,000 sought. They contend the court did not correctly apply the "lodestar methodology," the approach Wisconsin has adopted for determining the reasonableness of attorney fees. Kolupar v. Wilde Pontiac Cadillac, Inc., 2004 WI 112, ¶¶ 28-29, 275 Wis. 2d 1, 683 N.W.2d 58; Anderson v. MSI Preferred Ins. Co., 2005 WI 62, ¶ 39, 281 Wis. 2d 66, 697 N.W.2d 73.

¶ 52. The amount of an attorney fee award is left to the discretion of the trial court. Kolupar, 275 Wis. 2d 1, ¶ 22. Generally, we uphold the trial court's determination unless the court erroneously exercised its discretion, giving deference to the trial court's greater familiarity with local billing norms and its opportunity to have witnessed first-hand the quality of the representation. Id. We do not substitute our judgment but examine the court's explanation to determine if it employed a logical rationale based on the appropriate legal principles and facts of record. Id.

¶ 53. As a starting point with the lodestar approach, the trial court first must multiply the number of hours reasonably expended on the litigation by a reasonable hourly rate. Anderson, 281 Wis. 2d 66, ¶ 39. The court then may make upward or downward adjustments based on any factors in SCR 20:1.5(a) (2005) that in the court's discretion are relevant. Anderson, 281 Wis. 2d 66, ¶ 39.

¶ 54. In support of their attorney fee claim, the Stuarts provided a thirty-page billing summary. The trial court observed that "what it boils down to is, under [Wis. Stat. § 100.20(5)], are over $200,000 in attorney fees reasonable." The court found that: the Stuarts' lead attorney provided "excellent," well-prepared representation; both Stuart attorneys' hourly charges were reasonable; two plaintiff attorneys were necessary; and even where isolated itemized charges seemed "rather high," without further information the court would be guessing as to their reasonableness. The court concluded that to properly assess whether the $200,000 legal bill was reasonable, it would have to hold a hearing, the time and expense of which it deemed unreasonable. The court then considered numerous other options, describing in detail its rationale for rejecting each one, and for ultimately settling on the method it determined was most reasonable. While we conclude that the court's final choice must be revisited, we do appreciate the care the court took to make a thorough record.

¶ 55. Ultimately, the trial court concluded that the most reasonable approach was one based on the jury's apportionment of the damages between the ATCP 110 violation and negligence. Thus, the court took the 25% of the $95,000 award apportioned to the ATCP 110 violation ($23,750), doubled that amount ($47,500), and then took one-third of that to reflect the customary plaintiff attorney fee ($15,675). The court also stated that the 75% negligence apportionment meant that three-fourths of the damage award, or $71,250, "is between the plaintiffs and their-attorney. Whether they end up at an hourly rate or a one-third of that is not an issue for this Court to decide."

¶ 56. We reverse the trial court's ruling on a number of grounds. First, the court erred by looking for a way to reduce the amount simply because it deemed $200,000 in fees too high on a $95,000 damage case. Disparity between the amount of damages and requested attorney fees alone does not mean the fees are unreasonable. In Wis. Stat. § 100.20(5) cases, an award of attorney fees may well exceed the amount of double damages to encourage attorneys to undertake such cases. See Pierce v. Norwick, 202 Wis. 2d 587, 598, 550 N.W.2d 451 (Ct. App.1996) (section 100.20(5) case involving Wis. Admin. Code § 134.06 violation); cf. Benkoski, 242 Wis. 2d 652, ¶¶ 2, 4 (section 100.20(5) case in which damage and attorney fee awards of approximately $10,000 and $51,000, respectively, were left undisturbed).

¶ 57. Second, the trial court used the apportioned damages as a premise for the attorney fee calculation, a methodology we have already rejected in the preceding discussion regarding the calculation of damages under Wis. Stat. § 100.20(5). Third, the court observed that a hearing on the issue of attorney fees would require additional time and expenses to the parties. We know of no authority that precludes a hearing on requested attorney fees on this basis. We remand for a redetermi-nation of the Stuarts' attorney fees.

3. Special Verdict Question Regarding Weisflog's Personal Liability

¶ 58. The Stuarts argue that the trial court improperly excluded a verdict question inquiring as to Weisflog's potential personal liability. The Weisflog parties counter that the jury verdict concluding that the Remodeling Contract was with the Gallery not Weis-flog, merits vast deference. While we agree with this statement, we disagree that it controls the question.

¶ 59. Instead, Rayner, released shortly after the Stuart-Weisflog trial ended, controls this issue. There, homeowners brought an action against a corporate home remodeling contractor and the president and an officer of the corporation, alleging ATCP 110 violations and breach of contract. Rayner, 277 Wis. 2d 535, ¶¶ 4-6. As in the case at bar, the signature page of the contract in Rayner contained no reference to any corporate entity or to the signer's official capacity as corporate president. Id., ¶ 4. The corporation's president and officer unsuccessfully sought to be dismissed personally from the action. Id., ¶¶ 7, 9. We upheld this ruling, holding that Wis. Admin. Code § ATCP 110.0K5) provides for liability for individual wrongdoers. Rayner, 277 Wis. 2d 535, ¶ 11. The court explained that consumer protection statutes and administrative rules must be read together to achieve the goal of providing protection and remedies to consumers:

Accordingly, we construe "and their officers, representatives, agents and employees," see Wis. Admin. Code § ATCP 110.01(5), to have its plain meaning: all of the named individuals and entities are potential sources of the unfair methods of dealing that Wis. Stat. § 100.20 meant to stamp out. To the extent individuals have the power to prevent unfair dealings with consumers, individuals will incur liability for noncompliance.

Rayner, 277 Wis. 2d 535, ¶ 14 (footnote omitted).

¶ 60. The Rayner court rejected the arguments that the legislating authority did not intend to create personal liability for corporate representatives and that the DATCP had no authority to do so. Id., ¶¶ 16-17. The court reasoned that holding individual wrongdoers accountable is necessary to adequately accomplish the purpose behind Wis. Stat. § 100.20. "We will not read § 100.20(2) to hand the DATCP an empty mandate .... Where the corporate veil frustrates the purpose of a statute, we must assume the legislature intended to pierce it." Rayner, 277 Wis. 2d 535, ¶ 17.

¶ 61. Weisflog argues that he cannot be held personally liable because the parties all testified that they thought the Remodeling Contract was made with the Gallery, not Weisflog personally, and the jury concurred. This argument sidesteps the import of the Architectural Contract, which came first. The Architectural Contract was induced by the misrepresentations as to the Gallery's architectural capabilities, the quality of plans that would be produced and the Weisflog parties' knowledge of building code requirements. That Weisflog deems the Gallery to be the contracting party is immaterial under Rayner. In addition, an individual is personally responsible for his or her own tortious conduct. Oxmans' Erwin Meat Co. v. Blacketer, 86 Wis. 2d 683, 692, 273 N.W.2d 285 (1979). If the tortfeasor is shown to have been acting for the corporation, the corporation also may be liable, but the individual is not thereby relieved of his or her own responsibility. Id. As Rayner teaches, the corporate veil may be pierced to allow personal liability against individual wrongdoers "if it is shown that the individual — rather than the entity — is responsible for devising the unfair method of selling home improvements." Rayner, 277 Wis. 2d 535, ¶ 1.

¶ 62. Unfortunately, the trial court did not have the benefit of Rayner when the special verdict was being fashioned. To its credit, however, the court recognized the significance of Rayner, commenting at the hearing on motions after verdict that it harbored "great concerns" about the correctness of its ruling in view of Rayner. Nonetheless, the court declined to grant a new trial on that issue. Given Rayner, we are compelled to reverse and remand for a trial on the narrow and limited question of Weisflog's personal liability as to the Stuarts' ATCP 110 claims.

CONCLUSION

¶ 63. We affirm the judgment as it relates to the cross-appeal. We hold that the action is not time-barred, that the ELD does not apply, and that the Weisflog parties' remaining issues are either waived by failing to provide cites to the record or conceded by failing to respond in their cross-reply brief to the Stuarts' arguments.

¶ 64. We reverse the judgment as to the issues the Stuarts raise on appeal. We remand with directions that the full damages award be doubled and for a redeter-mination of attorney fees. We further direct a trial on the limited question of Weisflog's alleged personal liability on the Stuarts' ATCP 110 claims.

¶ 65. Costs are awarded to the Stuarts.

By the Court. — Judgment affirmed in part; reversed in part and cause remanded with directions; orders affirmed.

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       All references to the Wisconsin Administrative Code are to the October 2004 version unless otherwise noted.

       Hereinafter, when Weisflog and the Gallery take a unified position, we will refer to them as "the Weisflog parties."

       The Stuarts' brief prompts a reminder to counsel that the fact section should objectively recite the historical and procedural facts; it is no place for argument. See Arents v. ANR Pipeline Co., 2005 WI App 61, ¶ 5 n.2, 281 Wis. 2d 173, 696 N.W.2d 194, review denied, 2005 WI 136, 285 Wis. 2d 626, 703 N.W.2d 376.

       The Stuarts' complaint also named American Family Insurance, Weisflog's and the Gallery's liability insurer, as a defendant.

       The Weisflog parties' motions for summary judgment did not challenge the Stuarts' negligence claims.

       We acknowledge that in Taft v. Derricks, 2000 WI App 103, ¶¶ 2, 12, 235 Wis. 2d 22, 613 N.W.2d 190, and Antwaun A. v. Heritage Mutual Insurance Co., 228 Wis. 2d 44, 66-67, 596 N.W.2d 456 (1999), the appellate courts addressed whether the statutes and ordinances at issue in those cases offered a basis for imposing civil liability as to the plaintiffs' negligence claims, whereas here we are concerned with the Stuarts' misrepresentation claims under ATCP 110. However, both claims are tort based. We therefore deem the analysis set forth in Taft and Antwaun applicable to the misrepresentation claims in this case.

       We appreciate that the jury found in a separate question that the Gallery did not misrepresent "that they were licensed architects." This answer apparently adopts Weisflog's testimony that he did not expressly represent to the Stuarts that he was a licensed architect. However, this answer does not eliminate the fact that Weisflog represented to the Stuarts that he or the Gallery would provide architectural plans and that such would conform to all applicable building codes. The jury's finding that the Gallery falsely induced the Stuarts to enter into the Architectural Contract is presumably based, at least in part, on this evidence.

       The Architecture Contract provided, in part:
      We, Robert Stuart and Linda Farquhar-Stuart hereby agree to pay in full the remodeling architectural fee of $1,000.00 above and beyond our down payment of $500.00 ... following the approved, finalized drawings of our home design.... We understand that this remodeling architectural fee will be applied toward the construction costs of the remodeling project, after we sign a contract with Weisflog's Showroom Gallery, Inc., accepting this corporation as the remodelers of our future project.
      The Stuarts claim the $1500 never was applied toward the construction costs. At trial, they suggested that that was why the Remodeling Contract was signed on "Specialty Drywalling & Repairs" stationery.

       We are not holding that the absence of a reply brief automatically permits the invocation of this rule. To the contrary, we see many cases where a reply brief is unnecessary. Rather, we limit the application of this rule to those instances when the respondent's brief introduces new and relevant information not addressed in the appellant's brief-in-chief and which bears on the resolution of the issue. That is the situation in this case. The cross-respondent's brief filed by the Stuarts recites new and relevant information on the issue and the Weisflog parties have failed to respond.

       This argument is based on the jury's answer to Question 9 of the special verdict stating that the Remodeling Agreement was between the Stuarts and the Gallery, not Weisflog.

       We therefore need not address the Stuarts' further contentions that the apportionment question runs afoul of the law of indivisible harm and that the question conflicts with the jury's further answer that the Gallery was negligent in the design of the remodeling project.

       By analogy, the reasoning of the court in Baierl v. McTaggart, 2001 WI 107, 245 Wis. 2d 632, 629 N.W.2d 277, supports our conclusion. There the supreme court held that an entire lease was unenforceable because of one provision that violated Wis. Admin. Code § ATCP 134.08, also adopted pursuant to Wis. Stat. § 100.20. Baierl, 245 Wis. 2d 632, ¶ 40. The court said that mere severance of the offending clause not only would fail to advance the polity goals of § ATCP 134.08, but would undérmine them entirely. Baierl, 245 Wis. 2d 632, ¶ 33. Private actions are an important adjunct to the justice department's efforts, and if severance were the only penalty, consumers would be intimidated about bringing actions and future unfair trade practices would not be deterred. Id., ¶¶ 35-36.

       The use of "lodestar" in this context seems to have originated in Lindy Bros. Builders, Inc. of Philadelphia v. American Radiator & Standard Sanitary Corp., 487 F.2d 161, 168 (3rd Cir. 1973), which observed that "the amount thus found to constitute reasonable compensation should be the lodestar of the court's fee determination." See Kolupar v. Wilde Pontiac Cadillac, Inc., 2004 WI 112, ¶ 28, 275 Wis. 2d 1, 683 N.W.2d 58.

       SCR 20:1.5 provides in relevant part:
      (a) A lawyer's fee shall be reasonable. The factors to be considered in determining the reasonableness of a fee include the following:
      (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
      (2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
      (3) the fee customarily charged in the locality for similar legal services;
      (4) the amount involved and the results obtained;
      (5) the time limitations imposed by the client or by the circumstances;

        (6) the nature and length of the professional relationship with the client;
      (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
      (8) whether the fee is fixed or contingent.
      The factors in SCR 20:1.5(a)(1), (3), and (7) essentially are subsumed in the determination of a reasonable number of hours and a reasonable hourly rate. See Lynch v. Crossroads Counseling Ctr., Inc., 2004 WI App 114, ¶ 40, 275 Wis. 2d 171, 684 N.W.2d 141.

       Wis. Admin. Code §ATCP 110.01(5) provides: "'Seller' means a person engaged in the business of making or selling home improvements and includes corporations, partnerships, associations and any other form of business organization or entity, and their officers, representatives, agents and employees."

       The trial is limited to the question of Weisflog's personal liability, since the damages have already been determined.


source: Caselaw Access Project

author: ANDERSON, J.

license: Public Domain

text:
    In re the Marriage of: Jayna M. Covelli, Petitioner-Respondent, v. Todd M. Covelli, Respondent-Appellant.
    Court of Appeals

      No. 2005AP1960.

      Submitted on briefs April 6, 2006.

      Decided May 3, 2006.

    2006 WI App 121
    (Also reported in 718 N.W.2d 260.)

      On behalf of the respondent-appellant, the cause was submitted on the briefs of Thomas W. Anderson, Jr., of Anderson Law Office, Kenosha.

      On behalf of the petitioner-respondent, the cause was submitted on the brief of Mark E. Sanders and Julie A. Neuhaus of Hailing & Cayo, S.C., Milwaukee.
    Before Brown, Nettesheim and Anderson, JJ.
   ANDERSON, J.

¶ 1. Todd M. Covelli appeals his judgment of divorce, challenging the trial court's property division and maintenance and child support determinations. Todd argues that the trial court's factual findings concerning the value of his used car dealership and his annual income were clearly erroneous. Todd further maintains that the trial court's erroneous valuation of his dealership was the product of a bias against him as exhibited by the court's repeated questioning of him when he was on the witness stand. Finally, Todd argues that the trial court erred in determining that he should be held responsible for any delinquent tax liabilities because he had committed marital waste by failing to satisfy those obligations.

¶ 2. We hold that the court's factual findings are supported by the evidence, in particular the testimony of his former wife, Jayna M. Covelli, and her expert. We also conclude that the trial court, functioning as a fact finder, permissibly and impartially questioned Todd in order to clarify his testimony and expedite the trial. Finally, we hold that the trial court properly determined that Todd had committed marital waste by failing to satisfy any outstanding tax debts because, in so doing, he unjustly dissipated marital assets. We affirm the judgment.

FACTS

¶ 3. Jayna and Todd were married in 1988 and have two minor children. During the majority of their marriage, Jayna stayed at home with the children. Todd operated a used car dealership, Anthony Motors, as a sole proprietor. Jayna did not play a role in the operation of Anthony Motors, the processing of business records or the filing of taxes.

¶ 4. Jayna first filed a petition for divorce in November 2002. In December, Todd filed a financial disclosure statement that set his monthly income at approximately $3318 or around $40,000 annually. In April 2003, Todd filed a new financial disclosure statement that provided his monthly income was approximately $6763 or over $80,000 annually.

¶ 5. The parties later reconciled and the court dismissed the action in June 2003. Apparently at some point in August, the parties jointly filed their 2002 tax return, which reported an annual income of around $40,000.

¶ 6. In September 2003, Jayna filed the petition for divorce that forms the basis for this appeal. In October 2003, Todd filed his first financial disclosure statement in the current divorce action. He claimed his monthly income was approximately $3430 or over $40,000 annually. Todd later corrected this financial disclosure statement to reflect an annual income for 2002 of over $80,000. Todd filed a financial disclosure statement for 2003 in which he indicated that his monthly income totaled approximately $4085 or around $50,000 annually.

¶ 7. The trial court held evidentiary hearings between May and August of 2004 to settle the parties' disputes over maintenance and child support and the division of their property. Jayna and Todd each testified during the hearings as did their respective experts, Scott Franklin and James Tirabassi.

¶ 8. Jayna testified that Todd paid the bills and handled the taxes: "It wasn't my choice. What he did on his taxes he did. He talked to the accountant. I had nothing to do with that. I didn't know anything that happened with the figures for the business and he knows that." She claimed that she had not personally signed the joint tax returns for the previous three years. She testified that Todd informed her that an individual from Illinois had approached him at the dealership and offered to purchase it for $180,000. She also commented on the lifestyle the parties led prior to their divorce, noting their memberships to a country club, the extensive list of their children's activities, her $500 per week spending allowance and their many international trips. She submitted an exhibit in which she claimed an implied annual income of $94,608.

¶ 9. Todd denied that he had been offered $180,000 for the dealership and claimed that he would sell it for $100,000. Todd confirmed that Jayna did not participate in the filing of taxes or the processing of dealership business records, but averred that Jayna had signed the 2002 tax return. Todd explained that the 2002 tax return that he filed, which claimed around $40,000 in annual income, was mistaken due to some accounting errors. He testified that the tax return prepared in April 2003 reflecting an income for 2002 of approximately $80,000 was correct and that he intended to amend his 2002 tax returns. Todd admitted that he was being audited for his failure to pay sales taxes and estimated that he owed between $4000 and $6000. The court asked Todd several questions on multiple occasions throughout his testimony.

¶ 10. Franklin, Jayna's expert, testified to the difficulties of valuing Anthony Motors due to his concerns about the reliability of the underlying financial records. He stated that he had very little confidence that the tax returns were accurate as required by tax law and referenced "mysterious adjustments in the general ledger" of the dealership. He noted that the 1999 financial records indicated an income of $71,500, but the tax return for that year reported an income of $14,300 and the 2000 financial records indicated an income of $99,000, but the tax return for that year showed an income of $32,000. When asked to consider whether the alleged $180,000 offer for the business made sense based on the financial records, he responded that it was a "reasonable number" but probably "a low end valuation." He reached this conclusion by valuing the dealership as a multiple of earnings, which he calculated to be an average of $80,000 per year based upon Todd's income over the previous four years.

¶ 11. Tirabassi testified on Todd's behalf. Tira-bassi did not express an opinion as to the accuracy of the 2002 tax returns. He also did not put together a business valuation for the dealership. He testified that Franklin had engaged in "one method of assessing a value to a business," but that "there's a lot of things that go into doing a valuation of a small business." He testified that he found no discrepancies between the reported income for the year 2003, which was $54,947, and the available financial records for that year.

¶ 12. ' Immediately following the hearings, the trial court rejected Todd's testimony as incredible, stating that Todd did not "forthrightly answer questions" or "direct himself to the information that's being sought." In a written judgment, the court specifically rejected as incredible Todd's testimony concerning the value of the dealership and his annual income. The court adopted Jayna's testimony concerning the offer to purchase and found the dealership to have a value of $180,000. The court further determined that if Todd owed back sales taxes from his operation of the business,

it shall be his obligation, and it is found to have arisen from his waste of a marital asset. [Jayna] shall have no liability for such taxes if they are found to be due and owing. She had little to nothing to do with the business and [Todd's] business practices were clearly based on his decisions.

The court found that Todd's annual income was $94,608. The court commented that it was difficult to precisely determine Todd's income because of the many occasions that he gave inconsistent information about that income. The court explained that the family lifestyle could not have been enjoyed on an income of $40,000. Todd appeals.

STANDARD OF REVIEW

¶ 13. The division of the marital estate is discretionary and we will sustain it if the trial court examined the relevant facts, applied a proper standard of law, and using a demonstrated rational process, reached a conclusion that a reasonable judge could reach. Liddle v. Liddle, 140 Wis. 2d 132, 136, 410 N.W.2d 196 (Ct. App. 1987). Underlying discretionary determinations may be findings of fact and conclusions of law. State v. Holmgren, 229 Wis. 2d 358, 366, 599 N.W.2d 876 (Ct. App. 1999). We review questions of law de novo. Id. We will not overturn findings of fact unless they are clearly erroneous. Id.

¶ 14. When reviewing fact finding, we search the record for evidence to support findings reached by the trial court, not for evidence to support findings the trial court did not but could have reached. Johnson v. Merta, 95 Wis. 2d 141, 154, 289 N.W.2d 813 (1980). The weight and credibility to be given to testimony is uniquely within the province of the trial court. Siker v. Siker, 225 Wis. 2d 522, 528, 593 N.W.2d 830 (Ct. App. 1999). The trial court is in a far better position than an appellate court to make such determinations because the trial court has the opportunity to observe the witnesses and their demeanor on the witness stand. Lessor v. Wangelin, 221 Wis. 2d 659, 667-68, 586 N.W.2d 1 (Ct. App. 1998). The trial court also has a superior view of the total circumstances of the witnesses' testimony. State v. Owens, 148 Wis. 2d 922, 929, 436 N.W.2d 869 (1989).

¶ 15. The value of a business asset and the annual income of a party are factual determinations. See DeLaMatter v. DeLaMatter, 151 Wis. 2d 576, 588, 445 N.W.2d 676 (Ct. App. 1989) (income); Rodak v. Rodak, 150 Wis. 2d 624, 633, 442 N.W.2d 489 (Ct. App. 1989) (valuation determination a finding of fact). A trial court is not required to accept any one method of valuation over another. Schorer v. Schorer, 177 Wis. 2d 387, 399, 501 N.W.2d 916 (Ct. App. 1993).

DISCUSSION

Valuation of the Car Dealership

¶ 16. Todd challenges the court's finding that Anthony Motors' fair market value is $180,000. Todd complains that the record does not contain any credible evidence supporting the court's valuation of the dealership. Todd also argues that the court's questioning of him while he was on the witness stand is evidence of a bias that led the court to punish him through its valuation of his dealership.

¶ 17. The court's finding that Anthony Motors had a value of $180,000 is supported by credible evidence in the record. Jayna testified that Todd informed her that an individual had offered to purchase the dealership for $180,000. Todd complains that this was hearsay and should not have formed the basis for the court's valuation of the dealership. However, Todd did not object to her testimony as hearsay during the trial, see Caccitolo v. State, 69 Wis. 2d 102, 113, 230 N.W.2d 139 (1975) (failure to object results in waiver of any contest to that evidence), and the statement may be characterized as an admission by a party opponent, Wis. Stat. § 908.01(4)(b)1. (2003-04) (such statements are not hearsay).

¶ 18. Furthermore, the court had before it other testimony supporting its valuation. Franklin, Jayna's expert, testified that based on his valuation of the dealership as a multiple of Todd's average earnings, $180,000 was a "reasonable number" and probably on the low end. We are not persuaded by Todd's attack on Franklin's credibility on this point. See Siker, 225 Wis. 2d at 528 (trial court arbiter of witness credibility). Although Tirabassi, Todd's expert, cautioned that several factors go into the valuation of a small business, he agreed that the multiplier of earnings method of valuation Franklin used was certainly "one method of assessing a value to a business."

¶ 19. Todd offered no credible contrary evidence of the dealership's value. The court rejected Todd's testimony concerning the value of the business as incredible. We are in no position to disturb the trial court's determination that Todd, who had consistently offered inconsistent statements regarding his finances in years prior to 2003, offered testimony that was not credible. See id. (trial court is the ultimate arbiter of witness credibility). Todd contends that Tirabassi's testimony suggests that the dealership "was having a difficult time sustaining itself' and should be given more weight in the determination of the dealership's value. However, unlike Franklin, Tirabassi did not even conduct a valuation of the dealership or assess the financial records of the dealership from before 2003.

¶ 20. Because the trial court found Todd's testimony regarding the value of the dealership incredible and his expert did not offer a valuation method, the court was compelled to determine its value by some other means. Based on the available credible testimony from Jayna and her expert, Franklin, the trial court's determination that Anthony Motors had a value of $180,000 was not clearly erroneous.

¶ 21. We also reject Todd's assertion that the trial court unfairly punished him through its valuation of the dealership. Todd claims that the court developed an inappropriate bias against him, as evidenced by its questioning of him, once it learned that there had been discrepancies between his reported income and financial records.

¶ 22. First, we point out that the trial court also interrupted the testimony of other witnesses, including Jayna and Franklin, with questions. Second, a trial judge's authority to interrogate a witness is not open to debate. See Wis. Stat. § 906.14(2). Section 906.14(2) permits the trial judge to "interrogate witnesses, whether called by the judge or by a party." Our supreme court has repeatedly stated that, while the judge may not function as a partisan or advocate when questioning a witness, the judge is "more than a mere referee" and does have a right to clarity questions and answers and to make its own inquiries to see that justice is done. See State v. Bowie, 92 Wis. 2d 192, 208-09, 284 N.W.2d 613 (1979) (compiling cases).

¶ 23. Our review of the transcript reveals that the trial court's questioning of Todd was succinct and nonjudgmental. The questions the trial court posed were designed to clarify Todd's testimony and expedite the trial and do not disclose any partiality on the part of the court. The court simply took its fact-finding role in this case extremely seriously; it used the broad latitude granted by Wis. Stat. § 906.14(2) to determine what really happened with the parties' finances. This was the court's function as fact finder. Thus, we reject Todd's suggestion that the court's questioning of him is evidence of a bias that lead the court to punish Todd through its valuation determination. Further, we admonish Todd for his inappropriate disparaging of the trial court in his brief. See S.C.R. 20 Preamble (stating that while a lawyer has a duty to challenge the correctness of official action, "[a] lawyer should demonstrate respect for the legal system and for those who serve it, including judges . . .

Valuation of Todd's Income

¶ 24. Todd next argues that the trial court's determination that his income for purposes of maintenance and child support was $94,608 was clearly erroneous. The record provides a reasonable basis for the court's finding of Todd's income.

¶ 25. The trial court rejected Todd's testimony concerning his income for want of credibility. We see no reason to disturb this determination. Siker, 225 Wis. 2d at 528 (credibility the province of the trial court). During the two divorce actions, Todd claimed his income was as low as around $40,000 and as high as around $80,000. Indeed, in December 2002, Todd averred that his 2002 income was around $40,000 and, only four months later in April 2003, he claimed an income of approximately $80,000. Then, in approximately August, the parties filed a tax return reporting an income of around $40,000. Furthermore, Franklin testified to the substantial discrepancies between the income reported and the financial records for the several years prior to the divorce proceedings.

¶ 26. Todd directs us to Tirabassi's testimony that his income in 2003 was $54,967 and that the company's financial records and tax information supported this figure. The trial court, however, was not obligated to accept this figure as conclusive evidence of Todd's annual income. See Daniel R.C. v. Waukesha County, 181 Wis. 2d 146, 151, 160, 510 N.W.2d 746 (Ct. App. 1993) (citing maintenance and support cases to bolster conclusion that the trial court did not have to accept a party's representations of his or her income at face value). Further, the trial court reasonably concluded that Todd's incomplete disclosures on court documents, financial records and tax returns in the past made an exact determination of his annual income extremely difficult. See Lendman v. Lendman, 157 Wis. 2d 606, 612-13, 460 N.W.2d 781 (Ct. App. 1990) (contemplating a spouse's income over several years for purposes of maintenance award). The court, therefore, appropriately turned to the other credible evidence it had before it to establish Todd's income — namely, the exhibits and the portions of Jayna's testimony establishing the parties' lifestyle. See Lellman v. Mott, 204 Wis. 2d 166, 173, 554 N.W.2d 525 (Ct. App. 1996) (holding that the trial court could make its income finding based upon the available evidence when a party's intentional conduct precludes a precise determination of that annual income).

¶ 27. As the trial court stated, the parties simply could not have supported their lifestyle on an annual income of around $40,000. Jayna testified that the parties had multiple mortgage payments, had health club and country club memberships, took family vacations to places like Mexico, Jamaica, Miami and Las Vegas, dined out multiple times per week at nice restaurants, paid for expensive tennis activities for their daughter, allowed $500 per week for groceries and related items and frequently traveled to Chicago to see plays and stay the weekend. An exhibit shows that the parties had total monthly living expenses of $7,884 or annual expenses of $94,608. Thus, the record supports the trial court's finding that $94,608 represented Todd's annual income. Therefore, Todd's challenge to the trial court's determination of his income must fail.

Marital Waste

¶ 28. Todd's final argument is that the trial court erred in assigning him responsibility for any delinquent tax liability on the basis of marital waste. Todd contends that he did not commit marital waste because his conduct does not fall within the specific examples of waste, such as "excessive gambling or drinking" and the intentional or negligent destruction of property by "fire or accidents" that were cited in Anstutz v. Anstutz, 112 Wis. 2d 10, 12-13, 331 N.W.2d 844 (Ct. App. 1983). While it may be true that Todd's conduct does not fit neatly into those categories, any failure on his part to satisfy the tax obligations nonetheless falls within the definition of marital waste.

¶ 29. Although an equal division of property is presumed, Wis. Stat. § 767.255(3), the family court may deviate from an equal division after considering other factors enumerated in § 767.255(3). In particular, the court may consider each party's contribution to the marriage, § 767.255(3)(d), and, more particularly, "each party's efforts to preserve marital assets." Anstutz, 112 Wis. 2d at 12. The court may require a party to pay the debts arising from his or her squandering of marital assets or the intentional or neglectful destruction of property. Id. at 12-13. "To require a party to share in the debts created by a spouse's unjustified depletion of marital assets would constitute a failure to consider the total contribution of each of the parties to the marital estate." Id. at 13.

¶ 30. Thus, Anstutz teaches that Wis. Stat. ch. 767 makes recompense available when one spouse has mismanaged or dissipated assets. Haack v. Haack, 149 Wis. 2d 243, 253-54, 440 N.W.2d 794 (Ct. App. 1989). Depending on the circumstances of the case, one spouse's failure to pay tax debts clearly can be considered the mismanagement or dissipation of assets and therefore marital waste.

¶ 31. Here, the trial court's decision to allocate any tax liabilities to Todd was based on the following facts of record. Todd admitted that he was being audited for his failure to satisfy his sales tax obligations and estimated that he owed between $4000 and $6000. Jayna did not play a role in the operation of Anthony Motors, the processing of business records or the filing of taxes. Jayna testified that she had not signed the tax returns for the previous three years and the trial court rejected as incredible Todd's testimony to the contrary. Todd exercised complete control over Anthony Motors and made the business decisions. Thus, the record showed that Jayna was not aware of the increasing tax obligations and it was Todd who chose to spend the money. Under these circumstances, we agree with the trial court that Todd, alone, mismanaged the parties' marital assets and therefore should be held responsible for any tax liability.

CONCLUSION

¶ 32. The trial court's factual findings regarding the value of Anthony Motors and Todd's annual income were not clearly erroneous. The court undertook a reasonable inquiry and examination of the facts and the record shows that there is a reasonable basis for each of the court's determinations. Furthermore, the court, in its role as fact finder, appropriately and without bias questioned Todd in an effort to ensure that justice obtained. Finally, the court properly held that Todd's failure to pay his tax obligations constitutes marital waste and he should he held responsible for any delinquencies.

By the Court. — Judgment affirmed.

       Todd also engaged in other business activities, such as a second dealership, that apparently were not in operation at the time of the divorce proceedings.

       The parties entered into a mediated agreement as to custody and physical placement of their two children that was later incorporated into the judgment of divorce.

       Todd offers a meritless and convoluted argument that because Jayna admitted that she would purchase the dealership for $100,000, this is the value she assigned to the dealership. When her statement is read in context, it is clear that Jayna concluded that if she were offered the dealership for $100,000, she would consider it to be a "bargain."

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       Todd also challenges the unequal division of property. However, his complaint is premised on the trial court's valuation of the dealership. Because we conclude that the court's valuation of the dealership is not clearly erroneous, we need not address his argument concerning the property division further.

       Todd contends that Hauge v. Hauge, 145 Wis. 2d 600, 427 N.W.2d 154 (Ct. App. 1988), controls this case. We cannot agree. There, we ruled that the husband's control over an unsuccessful investment involving thoroughbred horses was not sufficient to assign the resulting debt to him as a part of the property division. Id. at 603-05. This case, however, involves more than just a failed business venture; it involves a culpable dissipation of marital assets. The debt arose because Todd did not ensure that the sales tax obligations were paid and instead chose to spend the money.


author: BROWN, J. SNYDER, P.J.

text:
    Richard G. Pool, Plaintiff-Appellant, v. City of Sheboygan, Defendant-Respondent.

    Court of Appeals

      No. 2005AP2028.

      Submitted on briefs December 8, 2005.

      Decided May 3, 2006.

    2006 WI App 122
    (Also reported in 719 N.W.2d 792.)

      On behalf of the plaintiff-appellant, the cause was submitted on the brief of Shawn Brock of Holbrook, Wurtz, Roth, Basler & Brock, LLP of Sheboygan.
    On behalf of the defendant-respondent, the cause was submitted on the brief of Stephen G. McLean, city attorney.
    Before Snyder, PJ, Brown and Anderson, JJ.

       Petition to review granted 7-25-06.

   BROWN, J.

¶ 1. Wisconsin Stat. § 893.80(lg) (2003-04) deals in part with how a governmental entity serves a notice of disallowance of a claim to a person who has filed a claim against it. This statute expressly states that a notice of disallowance must be served on the claimant by registered or certified mail. The statute is plain on its face, and there are policy reasons why we should hold governmental entities to strict compliance. Here, the notice of disallowance was served on the claimant's daughter. We hold that this will not do and reverse the circuit court's holding that strict compliance with the statute is unnecessary so long as the claimant had actual notice of the disallowance.

BACKGROUND

¶ 2. Richard G. Pool's residence is located on property that abuts State Highway 28/South Business Drive (Highway 28) in Sheboygan. When Pool purchased the property, it included a privacy fence running parallel to Highway 28. On January 7, 2002, the City of Sheboygan advised Pool that he must remove the fence because of a planned project to widen Highway 28. On or about May 21, 2003, despite numerous objections by Pool, the City removed Pool's fence. Pool sought compensation from the City, but was denied. In November 2003, the City installed a sidewalk where the fence once stood. Pool continued to express his objections to the City.

¶ 3. On May 25, 2004, Pool filed a notice of claim and claim, alleging inverse condemnation without compensation. Pool alleged that the City's removal of the fence resulted in a "substantial decrease in the property's value, as well as a permanent and substantial interference with the use and enjoyment of his land." He sought compensation in the amount of $65,000.

¶ 4. On September 8, 2004, the City sent a notice by certified mail to Pool, disallowing Pool's claim and advising him of the six-month statute of limitations for bringing a lawsuit on the claim. However, the City did not check the box on the certified mail receipt indicating "restricted delivery." On September 9, 2004, Pool's adult daughter, Tamara Pool, received the notice of disallowance and signed the certified mail receipt of service.

¶ 5. On March 22, 2005, Pool filed a petition for ascertainment of compensation against the City. The City moved to dismiss the petition because it was untimely under Wis. Stat. § 893.80(lg), which states in pertinent part, "No action on a claim under this section ... may be brought after 6 months from the date of service of the notice of disallowance." Following a hearing on June 3, the circuit court granted the City's motion to dismiss. The circuit court opined that it was "quite troubling and probably ill-advised for the City not to check the box that says restricted delivery because the statute clearly says complainant should be served" but went on to hold that Pool had "actual notice" of the notice of disallowance. The circuit court concluded that this was sufficient to satisfy the requirements of § 893.80(lg) and trigger the six-month limitation period. Pool appeals.

DISCUSSION

¶ 6. Pool contends that the six-month limitation period was never triggered because the City did not satisfy the requirements of Wis. Stat. § 893.80(lg). He presents two primary contentions to demonstrate that the City's notice of disallowance was deficient: (1) the notice of disallowance was not "served on the claimant" but rather was served on Pool's daughter and (2) the certified mail receipt was not "signed by the claimant" as required by § 893.80(lg). We need only address the first contention. See Gross v. Hoffman, 227 Wis. 296, 300, 277 N.W. 663 (1938) (only dispositive issues need be addressed).

¶ 7. The City appears to argue that even if service was not made "on the claimant" from a technical standpoint, the facts demonstrating "actual notice" are sufficient for purposes of Wis. Stat. § 893.80(lg). Specifically, the City points to the following undisputed facts: the certified letter was properly addressed to Pool at his residence, proper postage was affixed prior to sending, Pool's adult daughter signed the receipt, and Pool's daughter checked the box marked "agent" when she accepted the letter. Most importantly, the City argues, Pool admits that he received the notice.

¶ 8. The issue is one of statutory interpretation and application; as such, it raises a question of law that we review de novo. See Cary v. City of Madison, 203 Wis. 2d 261, 264, 551 N.W.2d 596 (Ct. App. 1996). When interpreting a statute, the sole purpose is to determine legislative intent. Id. If the statute is clear on its face, our inquiry into the legislative intent ends and we simply apply the statute to the facts of the case. Id.

¶ 9. Accordingly, we turn to the language of the statute, which states in relevant part: "Notice of dis-allowance of the claim submitted under sub. (1) shall be served on the claimant by registered or certified mail and the receipt therefor, signed by the claimant, or the returned registered letter, shall be proof of service." Wis. Stat. § 893.80(lg) (emphases added).

¶ 10. Pool argues that the City did not satisfy the requirements of Wis. Stat. § 893.80(lg) because the notice of disallowance was not served on Pool. We agree. When the legislature uses the word "shall" in a statute it is presumed to be mandatory. Karow v. Milwaukee County Civil Serv. Comm'n, 82 Wis. 2d 565, 570, 263 N.W.2d 214 (1978). Furthermore, in Cary, we stated that there was nothing unclear or ambiguous about the statute's, requirement that notice of disallowance be served "on the claimant." See, Cary, 203 Wis. 2d at 264-65. There, we held that the City of Madison did not comply with § 893.80(1)(b) when it served a notice of disallowance on Cary's attorney instead of on Cary, and we declined to relax the service requirements our legislature has explicitly mandated for notice-of-claim disallowances. Id. at 265, 268. Likewise, the notice of disallowance served on Pool's daughter is insufficient to comply with the statute because she is not the claimant. There is nothing unclear or open to interpretation in the statute's language that the notice of disallowance must be served on the claimant. See Linstrom v. Christianson, 161 Wis. 2d 635, 639, 469 N.W.2d 189 (Ct. App.1991) (notice-of-disallowance provisions of § 893.80(l)(b) are plain and unambiguous).

¶ 11. We disagree with the City's contention that actual notice suffices even in light of the clear and unambiguous language of the statute. Again, Cary is instructive even though that case turned aside a "substantial compliance" argument and did not have before it the "actual notice" contention that we have here. Still, Cary rejected the idea that "substantial compliance" would suffice as an alternative to serving the claimant, not only because of the clear and unambiguous language of the statute but also for public policy reasons. The Cary court explained that strict compliance was necessary to preserve bona fide claims. Cary, 203 Wis. 2d at 266-67. We hold that the same public policy rationale is true with respect to the "actual notice" assertion of the City here.

¶ 12. This public policy principle is so important that we take this opportunity to expand on it. In Wisconsin, a citizen cannot just go out and commence a lawsuit against a governmental entity. The citizen has hurdles he or she must meet. A citizen must first satisfy the notice-of-injury provision in Wis. Stat. § 893.80(1)(a), and after complying with that, must satisfy the notice-of-claim provision in § 893.80(l)(b). If both of these provisions are satisfied and the government rejects the claim, the citizen must begin suit within six months from the date of service of the notice of disallowance or be prevented from achieving redress in the courts. See § 893.80(lg). Time is therefore of the essence to the citizen during that six-month period.

¶ 13. Because legitimate claims can be thrown aside without redress when a claimant fails to follow the statutory requirements, strict compliance is required in how the government provides the notice of disallowance. Cf. Driver v. Housing Auth. of Racine County, 2006 WI App 42, ¶ 23, 289 Wis.2d 727, 713 N.W.2d 670 (Nos. 2005AP410 and 2005AP411) (strict compliance necessary because "actual notice" often difficult to determine in an individual case). Uniformity in the method of service for disallowing a claim is a burden a governmental entity can easily bear in order to make certain that the citizen's interest in timing is protected. Allowing "actual notice" or "substantial compliance" rationales to relax the requirement of the statute would essentially shift the burden to the citizen to prove that the notice given was insufficient for one reason or another. See id. (claimant may face "insurmountable task" of proving lack of notice). Timing issues would become fact driven and credibility laced instead of merely documentary. Cf. id. The burden to send a notice of disallowance is an easy one for the government to satisfy if it just follows the statute. That easy burden should remain on the government lest bona fide claims of citizens get cast aside. Cf. id. This is especially true where property rights are at stake, as is the case here. See id. We are convinced that placing a strict accountability burden on the government to provide notice in accordance with the statute was the intent of the legislature. See also id., ¶ 24 (relaxed standards invite noncompliance with statutory mandates).

¶ 14. Our understanding of the law in this regard is further bolstered by Humphrey v. Elk Creek Lake Protection & Rehabilitation District, 172 Wis. 2d 397, 403, 493 N.W.2d 241 (Ct. App. 1992). In Humphrey, five couples alleged that the Elk Creek Lake Protection and Rehabilitation District's negligence caused flood damage to their properties. Id. at 398-99. Each couple filed separately against the District, which denied all of the claims at a meeting on January 9,1991. Id. at 399. Five notices of disallowances were served, one on each couple, but the language in each stated that the District had voted to disallow the claim made by Richard and Theresa Stone, only one of the couples. Id. at 399-400. Nonetheless, the notices listed all five couples as claimants and included a "cc" line copying each couple on the notice of disallowance. Id. at 399. The District claimed that the claimants other than the Stones were sufficiently on notice of their disallowed claims. Id. at 402. We disagreed, holding that the existence of a plaintiffs knowledge of disallowance does not relieve a municipality from the service requirements associated with a notice of disallowance. See id. at 403.

¶ 15. Of particular relevance to our public policy discussion, the Humphrey court recognized that the notice of disallowance triggers the six-month statute of limitations for the claimant to sue the government in court and, if that time period passed, the property owners would be left without the right to have the claim heard by a competent tribunal. See id. at 401-03. Because the fate of a person's property right depended so much on when the clock started ticking, the court felt constrained to interpret the statutes "to preserve a bona fide claim so that it may be passed upon by a competent tribunal rather than cut off without trial." Id. at 403. In our view, the Humphrey court believed it to be essential that the government do it one way, the way the statute requires, so as to relieve all doubt on the part of both the government and the claimants.

CONCLUSION

¶ 16. We conclude that the City's notice of disallowance did not comply with the requirements of Wis. Stat. § 893.80(lg) and consequently, the six-month limitation period for Pool's claim against the City did not begin to run on September 9, 2004. The plain and unambiguous language of § 893.80(lg) required that the notice of disallowance be served on Pool. Accordingly, we reverse.

By the Court. — Order reversed.

SNYDER, P.J.

¶ 17. (concurring in part; dissenting in part). I concur in the mandate but not in the opinion's reasoning supporting the mandate. Wisconsin Stat. § 893.80(lg) expressly states a "Notice of disallowance of the claim submitted under sub. (1) shall be served on the claimant by registered or certified mail." The City used certified mail to serve Pool. The majority opinion is correct in that the statute of limitations for Pool's claim was not triggered by the notice of disallowance and that the judgment must be reversed. However, the opinion does not fully, or correctly, address the reasons that service upon Pool failed to comply with § 893.80(lg).

¶ 18. Pool's primary appellate contentions are that: (1) the notice of disallowance was not "served on the claimant," hut rather on Pool's daughter; and (2) the certified mail receipt was not "signed by the claimant." The majority opinion only addresses Pool's contention that the notice of disallowance was not "served on the claimant," the first contention. However, the second contention, that a receipt was not signed by Pool, is key and controlling where certified mail is utilized under Wis. Stat. § 893.80(lg).

¶ 19. A statute shall be construed to give effect to every part of it. Hahner v. Board of Educ. Wis. Rapids, 89 Wis. 2d 180, 189, 278 N.W.2d 474 (Ct. App. 1979). A statute must be construed in light of its purpose. Wisconsin's Envtl. Decade, Inc. v. PSC, 84 Wis. 2d 504, 518, 267 N.W.2d 609 (1978). The crucial difference between registered and certified mail is that the user of registered mail must be given a receipt upon which a postmark appears. Patterson v. Board of Regents, 103 Wis. 2d 358, 359, 309 N.W.2d 3 (Ct. App. 1981). A receipt is optional when certified mail is used. Id.

¶ 20. Here, the general rule of statutory construction concerning the use of certified and registered mail in Wis. Stat. § 990.001(13) is instructive, reading in relevant part:

[W]henever the statutes authorize. .. the use of registered mail, and do not require receipt of the addressee only, certified mail may be used if a sender's receipt is obtained from the postal authorities and return receipt is requested. If a return receipt signed by an addressee only is required, registered mail must be used. (Emphasis added.)

¶ 21. Wisconsin Stat. § 893.80(lg) requires the signed receipt of the claimant only and, therefore, would normally require that Pool's disallowance notice be sent by registered mail in compliance with Wis. Stat. § 990.001(13). However, construing § 893.80(lg) in that manner would produce a result inconsistent with the manifest intent of the legislature to authorize the use of certified mail. The legislature required, however, that when certified mail is used under § 893.80(lg) that the notice "shall be served on the claimant.. . and the receipt therefor, signed by the claimant.. . shall be proof of service." Id. (Emphasis added). The second requirement, that the receipt be signed by the claimant, assures that the § 893.80(lg) use of certified mail is consistent with the legislative concern expressed in the last sentence of § 990.001(13). In other words, in the context of service by certified mail the requirement that the receipt for the notice of disallowance he signed by the claimant excepts the required use of registered mail required under § 990.001(13). With this in mind, we can turn to the procedure used here to serve the notice of disallowance upon Pool.

¶ 22. Certified mail requires the use of PS Form 3800, the Certified Mail Receipt (CMR), and paying a fee of $2.40. The CMR does not require that a recipient sign for the mail. Even if the claimant directly receives the mail, the CMR itself will not satisfy the Wis. Stat. § 893.80(lg) requirement that a signed receipt be obtained from the claimant.

¶ 23. The City requested that a delivery receipt be obtained at the designated address on the CMR by using PS Form 3811, Return Receipt Requested (RRR), and paying an additional fee of $1.85. A receipt for the certified mail would have sufficed had it been signed by Pool. It was not. It was signed by his daughter as his agent. Compliance with the RRR may be by an agent, as was the case here, or the claimant. If Wis. Stat. § 893.80(lg) did not contain the additional requirement that the receipt be signed by the claimant, I would agree with the City that proper service was obtained upon Pool as the claimant at this point by certified mail. It is for that reason that the return of the receipt signed by the claimant, rather that service upon the claimant, is the controlling issue of law in this appeal.

¶ 24. The City could have insured compliance with Wis. Stat. § 893.80(lg) by requesting in the RRR that the certified mail be served upon Pool only by checking item 4 (Restricted Delivery), "Yes," and paying an additional fee of $3.70. This appeal, unfortunately, is about that $3.70.

¶ 25. While I concur that the reversal of the judgment is warranted, I must also conclude that the opinion fails to fully and properly analyze the appellate issues presented. In order to avoid future problems of this nature, it is highly recommended that the government entity spend the additional $3.70 to conform to the legislative intent as expressed in Wis. Stat. §§ 893.80(lg) and 990.001(13).

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       The record includes documents that refer to South Business Drive as State Highway 28, Highway 141, and Business Highway 42. Because Pool refers to Highway 28 in his appellate brief, and the City makes no objection, we accept that the roadway in question is Highway 28/South Business Drive in the City of Sheboygan.

       At the time we decided Cary v. City of Madison, 203 Wis. 2d 261, 551 N.W.2d 596 (Ct. App. 1996), the relevant statutory language was located in Wis. Stat. § 893.80(1)(b).

       The City claims that Cary is not authority for our holding because, there, the City of Madison sent its notice of disclaimer to the claimant's attorney at an address different from the claimant's address. Here, the City sent the notice to the correct address, the address of the claimant. The City argues that this makes all the difference. A close reading of Cary establishes, however, that it makes no difference.
      The Cary court was not the least bit interested in where the notice was sent. True, it did discuss the fact that notice was sent to the attorney's address rather than the claimant's. See Cary, 203 Wis. 2d at 265-66. But this discussion was only in response to the City of Madison's argument that the law considers the attorney's address to be the equivalent of the claimant's address for purposes of the notice-of-claim statute, and therefore, service on the attorney must be considered the same as service on the claimant. See id. at 263, 265-66. The Cary court rejected that argument and held that the law relied upon by the City of Madison did not apply to Wis. Stat. § 893.80 disallowance-of-claim notices. See Cary, 203 Wis. 2d at 265-66. Rather, the Cary court considered the only real question to be whether it was the claimant who had received the notice. See id. at 266. The Cary court wrote that the "statutes are very different, and we do not consider service on an attorney to be the equivalent of the plainly worded requirement that the disallowance notice be served on the claimant." Id.

       The concurrence argues that we should have addressed Pool's second argument, that a condition precedent to proper service of a notice of disallowance is a receipt signed by the claimant. We have concluded that it is unnecessary for us to reach this issue. Moreover, we have our doubts about the rationale of the concurrence. We note that the statute explains how a signed receipt shall be proof of service. It appears to us that the signed receipt is not a prerequisite for effective service but is, more simply, a legislative choice that the receipt be considered conclusive proof of the event. In other words, the signed receipt is conclusive evidence of service, not an element of service. We believe that the weakness in the concurrence is its failure to consider the term "proof of service."

       Pool's daughter, Tamara Pool, did not sign the Certified Mail Receipt (PS Form 3800) and there is no place to accomplish that task on that document. Tamara signed the Domestic Return Receipt (PS Form 3811, August 2001).

       Wisconsin Stat. § 893.80(lg) uses the term "claimant" while the postal documents refer to "addressee." For purposes of this appeal, the terms are interchangeable.

       Information relating to current U.S. Postal Service charges can be verified by any postal clerk at any Wisconsin post office or at www.usps.com.

       Pool disputes that Tamara was authorized to act as his agent. Because we have determined that service was not accomplished, the agency issue is not addressed.