text:
    Department of Taxation, Appellant, v. Siegman, Respondent.

      April 27

    June 2, 1964.

      For the appellant the cause was argued by E. Weston Wood, assistant attorney general, with whom on the briefs were George Thompson, attorney general, and Harold H. Persons, assistant attorney general.
    For the respondent there was a brief and oral argument by Irving H. Nelson of Milwaukee.
   Wilkie, J.

The sole issue to be determined on this appeal is: Does a transfer by a husband to a wife of full title in two appreciated parcels of real estate held in joint tenancy during the marriage, such transfer being made pursuant to a court-imposed divorce judgment making final division of the marriage estate under the terms of sec. 247.26, Stats., create income taxable to the husband pursuant to the provisions of sec. 71.02 (1) (g), Stats, f

The department’s rationale for the additional assessment of tax against Siegman is basically this:

Sec. 71.03 (1) (g), Stats., defines as a taxable receipt,

“All profits derived from the transaction of business or from the sale or other disposition of real estate or other capital assets; provided, that for the purpose of ascertaining the gain or loss resulting from the sale or other disposition of property, real or personal, acquired prior to January 1, 1911, the fair market value of such property as of January 1, 1911, shall be the basis for determining the amount of such gain or loss; . . .”

The department reasoned that the transfer of the property pursuant to the divorce decree was a disposition of an appreciated asset in discharge of Siegman’s obligation to support his wife at the economic and social status to which she had been accustomed, even though the marital relationship had been terminated. Conceding that the transfer was not made in lieu of alimony, the department reasoned that even if such transfer were properly labeled a final division of the marriage estate, pursuant to sec. 247.26, Stats., functionally such division was in satisfaction of Mrs. Siegman’s unliquidated right to support.

Therefore the discharge of the obligation of continuing support was income produced by the disposition of an appreciated capital asset.

The department further reasoned that, given an arm’s-length exchange of “property,” where the market value of only one item can be readily ascertained, an equality of exchange value could be assumed, and so the department concluded that the value of the unliquidated right to support “received” by Siegman was equal to the market value of the property transferred to his wife, and the difference between this figure and his adjusted basis on the properties was taxable income to Siegman, pursuant to sec. 71.03 (1) (g), Stats.

We disagree.

What does the term “income” mean as it is used in sec. 71.03 (1), Stats.?

This court has held that “ ‘income’ as used in the constitution is to be interpreted in accordance with its common, ordinary meaning as understood in everyday life. ‘It must be gain or profit and it must be money or something equivalent thereto.’ ”

In everyday usage, the phrase “taxable income” is not coextensive with the notion of economic gain or increment. To be deemed income, for the purpose of sec. 71.03 (1), Stats., an economic gain must be utilized by the taxpayer to satisfy some need before such increment is taxable. In short, the income in the sense of economic gain must be “realized,” before it can be taxed.

But when is economic gain or income “realized” so that it may be considered “taxable” ? Federal cases construing the Federal Revenue Code, which while not binding on this court are treated as persuasive guides as to the meaning of ch. 71, Stats., have evolved a concept of “realization” for tax purposes. In this respect, the first major federal case was Eisner v. Macomber.

Holding a stock dividend issued on common stock not to be income within the meaning of the Sixteenth amendment, the United States supreme court there reasoned:

“Here we have the essential matter: not a gain accruing to capital, not a growth or increment of value in the investment; but a gain, a profit, something of exchangeable value proceeding from the property, severed from the capital however invested or employed, and coming in, being ‘derived,’ that is, received or drawn by the recipient (the taxpayer) for his separate use, benefit and disposal; — that is income derived from property. Nothing else answers the description.”

In Helvering v. Horst, the United States supreme court greatly modified the “fruit and tree” analysis of Macomber.

The owner of negotiable bonds had detached interest coupons shortly before their due date and had given the coupons to his son. The son collected the interest at maturity and reported the amount as his income. Both gift and actual payment of the interest occurred during the same taxable year of the donor, who was on a cash-receipts basis. The commissioner of internal revenue contended that the father was liable to tax on the interest and his contention was sustained by the United States supreme court, which reasoned:

“Admittedly not all economic gain of the taxpayer is taxable income. From the beginning the revenue laws have been interpreted as defining ‘realization’ of income as the taxable event, rather than the acquisition of the right to receive it. . . . [p. 115.]
“. . . The rule, founded on administrative convenience, is only one. of postponement of the tax to the final event of enjoyment of the income, usually the receipt of it by the taxpayer, and not one of exemption from taxation where the enjoyment is consummated by some event other than the taxpayer’s personal receipt of money or property. . . . [p. 116.]
“. . . The taxpayer has equally enjoyed the fruits of his labor or investment and obtained the satisfaction of his desires whether he collects and uses the income to procure those satisfactions, or whether he disposes of his right to collect it as the means of procuring them. . . . [p. 117.]
“. . . Such a use of his economic gain, the right to receive income, to procure a satisfaction which can be obtained only by the expenditure of money or property, would seem to be the enjoyment of the income whether the satisfáction is the purchase of goods at the corner grocery, the payment of his debt there, or such non-material satisfactions as may result from the payment of a campaign or community chest contribution, or a gift to his favorite son. . v [p. 117.]
“The power to dispose of income is the equivalent of ownership of it. The exercise of that power to procure the payment of income to another is the enjoyment, and hence the realization, of the income by him who exercises it. . . . [p. 118.]”

Therefore, the Macomber concept of “income,” requiring value “derived from” and “severed from” property before recognition of income, gave way to the economist’s view of income. The satisfaction of nonmaterial desires by the assignment of the right to accrued income was a realization of the benefits of that income for the assignor even though such receipt was never “received or drawn by the recipient (the taxpayer) for his separate use . . .”

Analytically then, any economic gain or increment is income, constitutionally and within the meaning of the Federal Code. However, the receipt is not taxable until “realized,” that is to say, utilized for some benefit, material or otherwise, by the taxpayer. As Horst suggests, the realization requirement is a matter of administrative convenience. The cost of conducting annual valuations of -the appreciation on stock holdings, for example, would exceed the revenue recovered. The critical issue surrounding realization problems is not whether a receipt shall be taxed, but when it shall be taxed.

Subsequent federal cases have affirmed the Horst concept of realization in a variety of contexts. In 1962, in the case of Davis v. United States, the United States supreme court held that a transfer of appreciated property as a part of a property settlement upon divorce was a taxable event under the federal revenue code. The taxpayer had transferred stock to his former wife pursuant to a stipulated property settlement agreement incorporated in their divorce decree. As consideration for the securities conveyed, his wife released her rights to alimony, dower, and intestate succession under Delaware law. The court held that the transfer was a taxable event under sec. 1001 of the Internal Revenue Code of 1954, which provides that appreciation in the value of property shall be taxed only upon its “sale or other disposition” (a provision similar to sec. 71.03 (1) (g), Stats.). The taxable income to Davis was the difference between the market value of the stock at the time of transfer, and the adjusted basis of such stock. Holding that the transfer was in discharge of his wife’s inchoate marriage rights, and specifically, her right to continuing support, and further holding that it could be assumed that the value of these rights was equivalent to the fair-market value of the stock transferred, the court concluded that the husband had realized income through the disposition of an appreciated asset. The decision affirmed the view of several circuit courts of appeal, and rejected the view of another. Subsequently, the same result was achieved in a case in which the property settlement was wholly decreed by the court, without stipulation by the parties as to the terms of such settlement.

The department contends that the rationale and result of Davis and Pulliam ought to be applied in the instant case.

Sec. 71.03 (1) (g), Stats., provides that “[a] 11 profits derived from the transaction of business or from the sale or other disposition of real estate or other capital assets;” are taxable as a capital gain. (Emphasis added.) The term “other disposition” does refer to noncommercial transactions. This phrase was added to sec. 71.03 (1) (g) by ch. 453, sec. 2, Laws of 1931. Prior to this legislative change, sec. 71.02 (2) (d), Stats. 1929, included within gross income, “all profits derived from the transaction of business or from the sale of real estate or other capital assets.” In Miller v. Tax Comm. this court, in construing sec. 71.02 (2) (d), held that to give rise to taxable income “there must be a sale of capital assets at a profit. Generally but not necessarily the sale must be for money. The transaction should be one that constitutes a sale rather than a mere exchange of properties.” The addition of the term “other disposition” in ch. 453, sec. 2, Laws of 1931, was a legislative overruling of Miller. The transfer of an appreciated asset in return for qualitative, nonmaterial consideration, shall be deemed an “other disposition” within the meaning of sec. 71.03 (1) (g). Transfers similar to those present in General Shoe, International Freighting and Hall, supra, would be regarded as taxable events under ch. 71, Stats., even though such transfers are not sales, or strictly commercial transactions.

Clearly, the transfer of appreciated property pursuant to a property settlement incident to a divorce is a transfer for consideration. Upon termination of the marriage relationship, a husband continues to have an obligation to support his wife at the economic and social status to which she had become accustomed. This obligation may be satisfied in several different forms. Pursuant to the provisions of sec. 247.26, Stats., the court may order direct alimony or maintenance payments. However, the division of the marriage estate is also a means whereby the obligation to continue support is discharged. Although alimony payments and the division of the estate may be separated and may be seen as serving different functions, and although division of the estate seeks to bring about an equitable division of property already accumulated, such division being influenced partly by the conduct of the parties during the marriage, and partly by an estimate of the wife’s material and nonmaterial contribution during the marriage, without reference to future needs of the wife, the division of the marriage estate is also a means of providing the wife with support in the generic sense, after termination of the marriage. An examination of some of the criteria for division set forth in sec. 247.26 establishes this proposition. The trial court is to consider the age of the parties, their health, and their ability to earn when making a division of the estate.

Therefore, a court-decreed division of estate involving the transfer of appreciated property is a transfer in discharge of the obligation to continue support, and is a transfer for consideration.

It does not follow, however, that every transfer for a noncommercial consideration is an “other disposition” within the meaning of sec. 71.03 (1) (g), Stats. While Siegman has received an economic benefit by means of the transfer of the appreciated parcels of real estate under the Horst analysis of income, the calculation of that' benefit is a difficult matter. As we have already observed, not every receipt of income, in the sense of economic gain, is immediately taxable. Considerations of administrative convenience determine the “when” of taxation under the Horst analysis.

In Davis and Pulliam, the courts assumed that the value received by the husband was equivalent to the fair market value of the property transferred. Federal courts have held that, given a transfer of items when the market value of only one item can be determined, it may be assumed that the value of the other is equivalent to that of the determinable item, even though the transfer occurs in a noncommercial context.

But this assumption is contrary to the facts surrounding the division of a marriage estate incidental to a divorce. It cannot be maintained that the value of the wife’s unliquidated claim to support is equivalent to the fair market value of the transferred appreciated property. A division of the marriage estate often reflects a judgment as to the conduct of the parties during the marriage as well as being a means of providing support for the wife after termination of the marital relationship.

Therefore, a court may conclude that, even though the husband actually made the purchase from his own funds, and retained legal title, the wife should be awarded certain property, or an interest therein, as a payment for long-suffering acquiescence in abusive conduct on the part of the husband, without regard for the relationship of this property to her need for continuing support. These factors in combination may well result in a transfer of property, the fair market value of which far exceeds the value of the wife’s inchoate right to continuing support. The trial court has the power to provide for support and to divide the estate pursuant to sec. 247.26, Stats. Therefore, the right to continuing support and the result of the final division of the estate are not, under our law, coextensive categories and the basic assumption of Davis and Pulliam is inconsistent with the facts of many property settlements in this state.

In those cases where the court enters a final division of the estate based upon the stipulation of the parties, the possibility that the value of the property transferred far exceeds the value of the unliquidated right to support, is still present. A husband may well agree to transfer valuable property simply as a condition of release from the maelstrom of his marriage.

That property settlements surrounding divorce do not provide reliable guides to determine the economic benefit conferred by a release of the husband’s obligation to support by means of a property transfer, was recognized in Commissioner v. Marshman, supra.

Marshman transferred full interest in certain stocks to his wife as an incident of a divorce property settlement. The commissioner concluded that Marshman had realized taxable income in an amount equal to the difference between the fair market value and the adjusted basis of the stock. The court of appeals rejected the claim reasoning:

“To say that the fair market value of the property received is the same as the fair market value of the property given up not only ignores realities, but is the use of a formula which is radically different from the well established and well recognized formula approved by the courts for determining fair market value. Under long established rulings fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell. ... A single transaction between a husband and wife made under the emotion, tension and practical necessities involved in a divorce proceeding does not comply with this rule. . . .
“The evidence shows that because of the inclusion in the proposed settlement of some ‘emotional items,’ it looked at one time as though the negotiations were going to blow up and that there were occasions when the negotiations appeared about to break down. Under such conditions, values are lost sight of, concessions are made, one does not expect or insist upon getting his money’s worth for what he gives up. Unfortunately, it is often the case that what a husband transfers to his wife in a so-called property settlement in a pending divorce action is not given merely in exchange for a release of alimony and dower rights, but also includes, without being so labeled, such additional amount as the husband may be willing to pay in order to have the marriage status terminated. A property settlement in a divorce proceeding is usually influenced and often dictated by numerous intangible, personal and practical considerations which play no part in a transaction between a willing seller and a willing buyer in the open market. The value of what is given up is no criterion of the fair market value of the ‘property’ received.”

It is true that certain voluntary noncommercial transfers of appreciated property involving intangible, practical considerations will give rise to taxable income under sec. 71.03 (1) (g), Stats. It is also true that certain commercially grounded involuntary transfers give rise to taxable income under sec. 71.03 (1) (g). Yet, in these situations, the correlation between economic benefit received and the fair market value of the property transferred is easy to perceive. Transfers of property as an incident of a divorce settlement do not fit either category.

Because of the difficulty in assessing the economic benefit conferred upon the taxpayer in this context, we conclude that the legislature did not intend the transfer of appreciated property, as an incident of a property settlement, to be a taxable event within the meaning of sec. 71.03 (1) (g), Stats.

By the Court. — Judgment affirmed.

        Falk v. Wisconsin Tax Comm. (1930), 201 Wis. 292, 293, 230 N. W. 64.

       (1920), 252 U. S. 189, 40 Sup. Ct. 189, 64 L. Ed. 521.

        Eisner v. Macomber, supra, at page 207.

       (1940), 311 U. S. 112, 61 Sup. Ct. 144, 85 L. Ed. 75.

        Eisner v. Macomber, supra, at page 207.

        Commissioner v. Glenshaw Glass Co. (1955), 348 U. S. 426, 75 Sup. Ct. 473, 99 L. Ed. 483.

         Helvering v. Bruun (1940), 309 U. S. 461, 60 Sup. Ct. 631, 84 L. Ed. 864. Value added to land as result of construction of building during term of the lease, held to be income realized by lessor on termination of the lease. United States v. Hall (10th Cir. 1962), 307 Fed. (2d) 238. Transfer of interest in cattle in satisfaction of nonenforceable gambling debt, held to create income taxable as capital gain to owner of cattle. United States v. General Shoe Corp. (6th Cir. 1960), 282 Fed. (2d) 9, transfer of appreciated property by corporate taxpayer to qualified retirement trust held to be taxable event even though taxpayer not obliged to make transfer. See also International Freighting Corp. v. Commissioner (2d Cir. 1943), 135 Fed. (2d) 310, distribution of appreciated property to employees as bonus deemed taxable event.

       (1962), 370 U. S. 65, 82A Sup. Ct. 1190, 8 L. Ed. (2d) 335.

        Commissioner v. Halliwell (2d Cir. 1942), 131 Fed. (2d) 642; Commissioner v. Mesta (3d Cir. 1941), 123 Fed. (2d) 986.

        Commissioner v. Marshman (6th Cir. 1960), 279 Fed. (2d) 27.

        Pulliam v. Commissioner (10th Cir. 1964), 329 Fed. (2d) 97.

       (1928), 195 Wis. 219, 217 N. W. 568.

        Miller v. Tax Comm., supra, at page 221.

        Miner v. Miner (1960), 10 Wis. (2d) 438, 103 N. W. (2d) 4; Caldwell v. Caldwell (1958), 5 Wis. (2d) 146, 92 N. W. (2d) 356; Bunde v. Bunde (1955), 270 Wis. 226, 70 N. W. (2d) 624; Borchers v. Borchers (1949), 254 Wis. 302, 36 N. W. (2d) 79.

       “247.26 Alimony, property division. Upon every judgment of divorce or legal separation for any cause excepting that of adultery committed by the wife, the court may, subject to s. 247.20, further adjudge to the wife such alimony out of the property or income of the husband, for her support and maintenance, and such allowance for the support, maintenance and education of the minor children committed to her care and custody as it deems just and reasonable. The court may also finally divide and distribute the estate, both real and personal, of the husband, and so much of the estate of the wife as has been derived from the husband, between the parties and divest and transfer the title of any thereof accordingly, after having given due regard to the legal and equitable rights of each party, the ability of the husband, the special estate of the wife, the character and situation of the parties and all the circumstances of the case; but no such final division shall impair the power of the court in respect to revision of allowances for minor children under s. 247.25. A certified copy of such judgment which affects title to real estate shall be recorded in the office of the register of deeds of the county in which the lands so affected are situated.”

        Brackob v. Brackob (1952), 262 Wis. 202, 54 N. W. (2d) 900.

        Tonjes v. Tonjes, post, p. 120, 128 N. W. (2d) 446; Trowbridge v. Trowbridge (1962), 16 Wis. (2d) 176, 114 N. W. (2d) 129; Schneider v. Schneider (1961), 15 Wis. (2d) 245, 112 N. W. (2d) 584; Caldwell v. Caldwell, supra.

         Kronforst v. Kronforst (1963), 21 Wis. (2d) 54, 123 N. W. (2d) 528; Wagner v. Wagner (1961), 14 Wis. (2d) 23, 109 N. W. (2d) 507.

        United States v. General Shoe Corp. and International Freighting Corp. v. Commissioner, supra.

         Tonjes v. Tonjes, supra; Trowbridge v. Trowbridge, supra; Wagner v. Wagner, supra. Sec. 247.26, Stats.: “The court may also finally divide and distribute the estate . . . after having given due regard to . . . the character ... of the parties and all the circumstances of the case; . .

       Sec. 247.26, Stats. Wagner v. Wagner, supra: the court may consider conduct which caused the divorce.

        Commissioner v. Marshman, supra, at page 32.

        United States v. General Shoe Corp., International Freighting Corp. v. Commissioner, Helvering v. Horst, supra. Psychological gratification arising out of giving the gift.

       Sec. 71.03 (1) (g) “. . . If property, exclusive of inventories (as raw materials, goods in process and finished goods), as a result of its destruction in whole or in part by fire or other casualty, theft or seizure, or an exercise of power of requisition or condemnation or the threat or imminence thereof, is involuntarily converted into money which is within one year in good faith, under regulations prescribed by the department of taxation, expended in the replacement of the property destroyed or in the acquisition of other property located in Wisconsin similar or related in service or use to the property so destroyed, or in the establishment of a replacement fund which, within 2 years from date of the fire or other casualty, is actually expended to replace the property destroyed or in the acquisition of other property located in Wisconsin similar or related in service or use to the property destroyed, no gain shall be recognized, and in the case of gain the property so replaced or newly acquired, for purposes of depreciation and all other purposes of taxation, shall be deemed to take place of the property so destroyed. If any part of the money is not so expended, the gain, if any, shall be recognized, but in an amount not in excess of the money which is not so expended. ...”


source: Caselaw Access Project

author: Beilfuss, J.

license: Public Domain

text:
    P. C. Monday Tea Company, Plaintiff: Monday, Appellant, v. Milwaukee County Expressway Commission, Defendant and Respondent: Peter P. Woboril, Jr., and others, Impleaded Defendants and Respondents: United States of America, Intervenor.

      April 27

    June 2, 1964.

      For the appellant there were briefs by Martin J. Torphy and E. Campion Kersten, both of Milwaukee, and oral argument by Mr. Kersten.

    For the respondent there was a brief by Robert P. Russell, corporation counsel, and George E. Rice, first assistant corporation counsel, and oral argument by Mr. Rice.

   Beilfuss, J.

Issues.

1. Is an appeal from a condemnation award an assignable cause of action ?

2. Assuming that Robert W. Monday is not the real party in interest, was it prejudicial error for the trial court to reduce the caption of the case so that only his name appeared thereon and to deny defendant the opportunity to identify the other interested parties ?

3. Was the closing argument of counsel for the plaintiff improper and prejudicial ?

Assignability of Cause of Action.

If a cause of action survives it is assignable. Lehmann v. Farwell (1897), 95 Wis. 185, 70 N. W. 170. Sec. 331.01, Stats., provides that in addition to actions surviving at common law, actions for damage done to the property rights or interests of another, and for damages done to real or personal property, as well as other actions, also survive.

It is often said that at common law contract actions survive while tort actions die with the person. Wogahn v. Stevens (1940), 236 Wis. 122, 294 N. W. 503. However, the basic principle of survivability at common law was that wrongs which diminished property formed the basis of survivable actions while personal injuries did not. 1 Am. Jur. (2d), Abatement, Survival, and Revival, p. 86, sec. 51. Of course, if the principal wrong was a personal injury, the action would not survive even though property rights were incidentally affected. Howard v. Lunaburg (1927), 192 Wis. 507, 213 N. W. 301.

In Frey v. Duluth, S. S. & A. R. Co. (1895), 91 Wis. 309, 64 N. W. 1038, it was held that a right of action for compensation for partial taking of lands was assignable. In Kuhl v. Chicago & N. W. R. Co. (1898), 101 Wis. 42, 77 N. W. 155, the Frey Case was explained as holding that the obligation when a statutory remedy for just compensation is pursued is one in implied contract.

Defendant misses the mark when it argues that the appeal of the basic condemnation award is not assignable. The cause of action is assignable; the appeal is merely a procedure by which it is enforced.

Plaintiff as the Real Party in Interest.

Defendant argues that the assignments in plaintiff’s chain of title to the cause of action are conditional and not absolute. On this ground he asks for judgment notwithstanding the verdict because the action was not prosecuted in the name of the real party in interest as required by sec. 260.13, Stats.

It is unnecessary to decide whether Mr. Monday has an interest sufficient to satisfy the demand of the statute because all the other parties were and still are in the case. The case was prosecuted in Robert W. Monday’s name alone only as far as the jury was concerned because of the reduction of the caption. Error, if any, in this regard was nonprejudicial because the sole question for determination on this trial was fair market value.

Defendant also argues that the appeal from the basic award was not perfected by the proper party because at the time the last notices of appeal to circuit court were served a receiver had been appointed for the P. C. Monday Tea Company.

This argument was made for the first time on appeal. Defendant interpleaded numerous parties to this action. It went to trial on the merits. It is foreclosed now from complaining about procedural irregularities.

The Right to Identify the Interests of Other Parties in the Condemned Property.

The trial judge was of the opinion that counsel for the condemnor was entitled to point out to the jury the interest in the condemned property of the other parties to the action. He concluded that the denial of this right was prejudicial error and granted a new trial in the interests of justice. We do not agree. Identifying the interests of the other parties where the sole question for determination was fair market value would have served no purpose other than to alert the jury to the financial difficulties of the P. C. Monday Tea Company. Fair market value is defined as that amount which can be realized on sale by an owner willing, but not compelled, to sell to a purchaser willing and able, but not obliged, to buy. Wis J I — Civil, Part II, 8100; Allen v. Chicago & N. W. R. Co. (1911), 145 Wis. 263, 129 N. W. 1094. Whether to allow this type of backdoor comment on the financial condition of the record owner of the property at date of taking would be prejudicial error, we do not decide. The question is not before us.

Counsel for the condemnor concedes that he was not foreclosed from questioning the jurors regarding their connection with any party on voir dire examination. He did not take advantage of this opportunity. The interests of justice do not require that he be given another chance.

The Alleged Improper Argument.

Defendant complains because counsel for plaintiff in his closing argument characterizes one of defendant’s witnesses as “Mr. Condemnor” and “Mr. Take.” This witness was the defendant’s right-of-way engineer. He testified that he was in charge of all land acquisitions for the defendant. He testified on cross-examination that it was his duty to conduct a complete review of all appraisals; that he made an appraisal in the case; that he reviewed his own appraisal; and that he “came out 100 per cent.”

Under the circumstances, we consider the characterization of the witness to be fair comment. In weighing the witness’ testimony the jury was entitled to take into consideration any interest he might have in the case, professional or pecuniary. Counsel did not transgress the bounds of propriety in informing them of their right.

By the Court. — Order reversed, and cause remanded with directions to reinstate the jury verdict and for further proceedings according to law.


author: Currie, C. J.

text:
    Voigt, Appellant, v. South Side Laundry & Dry Cleaners, Inc., Respondent.

      April 27

    June 2, 1964.

      For the appellant there was a brief by Gerald H. Kops, attorney, and Norman W. Wegner of counsel, both of Milwaukee, and oral argument by Mr. Wegner.

    For the respondent there was a brief and oral argument by Charles C. Erasmus of Milwaukee.
   Currie, C. J.

Plaintiff contends that the outline of defendant’s retirement income plan, which was distributed by defendant to plaintiff and other employees, constitutes an enforceable contract which entitles plaintiff to the benefit payments of $42.50 per month for which he instituted suit. Plaintiff also contends that the applicable provisions of such outline are unambiguous and are not subject to variance or explanation by parol testimony.

Noncontributory pension plans are held to give rise to a contractual obligation by the employer to pay pension benefits to the employees entitled thereto under the plan communicated to the employees where the employees thereafter remain in the employer’s employment and render service for the requisite period. Cantor v. Berkshire Life Ins. Co. (1960), 171 Ohio St. 405, 171 N. E. (2d) 518; Ball v. Victor Adding Machine Co. (5th Cir. 1956), 236 Fed. (2d) 170; Siegel v. First Pennsylvania Banking & Trust Co. (D. C. Pa. 1961), 201 Fed. Supp. 664; Anno. 42 A. L. R. (2d) 461, 467. The same principle is applicable to profit-sharing plans. Zwolanek v. Baker Mfg. Co. (1912), 150 Wis. 517, 137 N. W. 769.

The outline of the retirement income plan distributed by defendant to its employees specified that full-time salaried employees who had at least a year of continuous employment with defendant on January 1, 1958, had not reached their normal retirement date, and were not covered under any other pension plan to which defendant contributes, were automatically covered under the plan as of January 1, 1958. Plaintiff met these eligibility requirements. Retirement benefits were specified to be $42.50 per month for an employee having completed twenty years of continuous employment with defendant on his normal retirement date, and a proportional fraction thereof for an employee who had then completed less than twenty years of employment with defendant.

The provisions of the outline under the heading “Normal Retirement Date” are as follows :

“Ordinarily, your Retirement Income will begin on your normal retirement date, that is, if you became covered under the Plan on January 1, 1958, on the first day of the month coinciding with or next following your 65th birthday or ten years of employment, whichever is the later date.'
“If you become covered under the Plan after January 1, 1958, your normal retirement date will be on the first day of the month coinciding with or next following your 65th birthday.”

If the above-quoted provisions stood alone unqualified by anything else, a reasonable interpretation would be that, inasmuch as plaintiff had more than ten years of continuous employment with defendant prior to reaching his sixty-fifth birthday, his normal retirement date was May 1, 1960. It would be an unreasonable interpretation of these quoted provisions to hold that the ten years of continuous employment requirement meant subsequent to January 1, 1958, so as to make plaintiff’s normal retirement date January 1, 1968, thus reading in a qualification which does not appear in the text. Such an interpretation would be inconsistent with the rule that pension trusts are to be liberally interpreted in favor of the employees. Frietzsche v. First Western Bank & Trust Co. (1959), 168 Cal. App. (2d) 705, 336 Pac. (2d) 589.

However, the concluding paragraph of the outline provides :

“Of course this is only a brief outline of the Retirement Income Plan. The Plan will be governed entirely by the terms of the Group'Annuity Contract between the Company and the Prudential.”

Thus, if the group annuity contract between defendant and Prudential contains a qualification that employees in plaintiff’s situation must have completed ten years of employment subsequent to January 1, 1958, or have reached the age of sixty-five, whichever is the later date, in order to be entitled to any retirement income, such provision would govern over any conflicting provision contained in the outline. Unfortunately, the annuity contract was not offered in evidence at the trial.

Luetzow, president of defendant, testified that at the time he distributed copies of the outline of the plan to the employees, including plaintiff, he explained that all employees, including Luetzow, would have to complete ten years of employment after January 1, 1958, in order to be eligible for benefits upon retirement. Luetzow’s son, treasurer of defendant, also testified that he gave the same explanation to the employees as did his father. The testimony of the Luetzows was given over the objection by plaintiff that such testimony varied the terms of a written contract. Two female employees testified they were present at the meeting of employees in the summer of 1958 at which the plan was explained by Luetzow. However, objections were sustained to questions which would have elicited what Luetzow then said. Defendant then made offers of proof that the testimony of these two witnesses would have substantiated Luetzow’s explanation of the plan. Plaintiff, on the other hand, had earlier in the trial testified that Luetzow had stated in his explanation given to the employees that anyone who had put in twenty years of employment with defendant would get $42.50 per month upon retiring at age sixty-five.

It is impossible for this court to determine whether the trial court’s finding of fact with respect to the ten-year employment requirement is grounded on the outline of the plan or upon Luetzow’s verbal explanation thereof. Inasmuch as plaintiff’s cause of action is based on a written contract and not estoppel, we consider any verbal explanation of the plan made by defendant’s officers to be immaterial. What is material and controlling are the provisions of the annuity contract between defendant and Prudential, and that was not before the court.

We deem this to be a proper case to exercise our discretionary power under sec. 251.09, Stats., on the ground that the real controversy has not been fully tried. Accordingly, we reverse and remand for the purpose of having the controlling annuity contract produced and admitted into evidence.

By the Court. — Judgment reversed, and cause remanded for further proceedings not inconsistent with this opinion.


author: Wilkie, J.

text:
    Tonjes, Appellant, v. Tonjes, Respondent.

      April 27

    June 2, 1964.

      For the appellant there were briefs by James R. Mattison and Becker, Kinnel, Doucette & Mattison, all of Milwaukee, and oral argument by James R. Mattison.

      For the respondent there was a brief by Welsh, Trow-bridge, Bills, Planert & Gould of Green Bay, and oral argument by Fred N. Trowbridge.

   Wilkie, J.

The sole question presented on this appeal concerns alimony. The issue may be framed more precisely as follows: When a wife has demonstrated living expenses of $600 per month as being necessary to maintain the economic and social status to which she had become accustomed during a marriage of twenty-two years, did the trial court abuse its discretion in determining that alimony payments of $150 per month are adequate in light of (1) a division of estate granting her 36 percent of a total marital estate of $83,516.64; (2) an independent inheritance, or separate estate, of $98,000 yielding $260 income per month; (3) $100 per month support payments for a minor child; and (4) the fact that she was the “guilty party” causing the divorce ?

The property of the parties which was subject to division is as follows:

Solely Owned Prop- Value at time erty of Husband Source of divorce
Securities Inheritance from husband’s mother $19,697.06
Securities Inheritance from wife’s parents 15,421.88
U. S. Bonds Husband’s earnings 137.04
Joint Property
U. S. Bonds Husband’s earnings 2,262.60
Securities Gift from husband’s aunt prior to marriage 2,554.00
Residence (equity) Husband’s earnings 24,272.23
Wife’s securities derived from husband 985.00 65,329.81
Cash value husband’s life insurance 8,900.00 $74,229.81
Husband’s interest in furniture, furnishings, equipment, and library of law firm (all assets except cash and accounts receivable) 1,707.86
75,937.67
Husband’s other interest in law firm
' (a) Accounts receivable 2,578.97
(b) Law firm cash items 5,000.00
$83,516.64
Household furniture, furnishings, and equipment not valued
1956 Chrysler and 1954 Dodge automobiles not valued

Under sec. 247.26, Stats., Mrs. Tonjes was awarded a $30,000 homestead free from all encumbrances, except the 1963 real-estate tax, her husband being required to assume a mortgage of $5,728. She also received all household furniture and equipment, except certain personal items belonging to Mr. Tonjes,. and a 1956 Chrysler automobile. The remaining estate, having a stipulated value of $53,516.64, was awarded to Mr. Tonjes. Therefore, Mrs. Tonjes received approximately 36 percent of the estate.

At the trial, Mrs. Tonjes established living expenses of $600 per month, which figure included real-estate taxes, food, and clothing expenses for herself and young John, insurance premiums, utilities, automobile operating costs, and entertainment and recreation expenses for herself and her son. This figure is not contested by Mr. Tonjes; rather he argues that under the circumstances of this case, the trial court should not have ordered the payment of any alimony, but, if it was correct for the court to order alimony, then the court properly exercised its discretion in requiring him to make alimony payments of only $150 and support payments of $100.

Upon termination of the marriage relationship, a husband has a continuing obligation to support his wife at the social and economic status to which she had become accustomed during the marriage. Although the division of an estate pursuant to sec. 247.26, Stats., is influenced to a degree by the conduct of the parties during the marriage, and by the wife’s direct and indirect contributions to the estate during the marital relationship, the court may also consider a wife’s future needs, and her ability to satisfy them from her special estate, or from her potential earning power when making a division pursuant to sec. 247.26. Although analytically severable for some purposes, considering that a division of estate reflects a judgment as to the wife’s material and non-material contributions during marriage, both alimony payments and division of the estate are means whereby a husband meets the obligation to support his wife in the status to which she was accustomed. Therefore, the same factors to be considered in making a division of estate may be considered to determine the amount of an alimony payment.

Mr. Tonjes has, for the past ten years, averaged $22,000 per year as income from his law practice. Given Mr. Tonjes’ potential earning power, in addition to his property holdings of $53,000, he has the means to satisfy his wife’s living expenses of $600, without significantly reducing his own standard of living.

However, the fact that a husband has the resources to satisfy his wife’s continuing needs does not in and of itself justify imposing this liability on him. Only if the wife has no independent estate of her own, and/or lacks earning capacity, would the husband’s relative affluence be a determinative factor in his alimony liability. Even under these circumstances, the court could properly consider the conduct of the parties during the marriage in making nonpunitive adjustments.

In the instant case, Mrs. Tonjes has an independent estate of $98,000, which produces an income of $260 per month. The trial court could within its discretion properly conclude that Mrs. Tonjes could apply the $260 a month income from her inheritance to her living expenses of $600. To hold otherwise would be to eliminate the separate estate of the wife variable from consideration in assessing the obligation to continue support. However, the $260 income from her estate, and the $250 provided by Mr. Tonjes for alimony and support, pursuant to the divorce judgment, still fall short of the proven expenses of $600. To continue living in the status to which she had become accustomed, Mrs. Tonjes would have to invade the corpus of her inheritance. She has no future income earning capacity.

It is clear that the trial court considered this necessary invasion a proper result in view of the fact that Mrs. Tonjes was the “guilty” party in the divorce. While the trial court may consider the deliberate misconduct of the parties during the course of the marriage as a factor bearing upon division of estate and alimony payments by resolving certain ambiguities in economic position against the erring partner, he cannot utilize this variable as a device to affirmatively punish the “guilty” party. To require Mrs. Tonjes, who is in all probability unemployable, to invade the corpus of her inheritance to maintain her standard of living, to the extent of $90 per month, while her husband’s ability to pay is sufficient to pay at least a portion of this $90 without affecting his standard of living, can only be viewed as a punishment for her conduct during marriage.

We conclude that it was an abuse of discretion, under the circumstances as they existed at the time of the divorce, for the trial court to require the plaintiff to contribute from her corpus the full $90 needed to meet her proven expenses, and that ordering monthly alimony payments by Mr. Tonjes of $200 would achieve an equitable result, given Mrs. Tonjes’ unemployability, her separate estate, Mr. Tonjes’ ability to pay and the conduct of the parties leading up to the divorce.

Therefore, we conclude that the judgment should be modified so that Mr. Tonjes’ alimony payments are increased from $150 per month to $200 per month.

Because a total denial of alimony would be an even more punishing result, Mr. Tonjes’ claim in his petition for review is rejected.

By the Court. — Judgment is modified to increase alimony payments from $150 to $200 per month and, as so modified, affirmed.

Dieterich, J., dissents.

        Caldwell v. Caldwell (1958), 5 Wis. (2d) 146, 92 N. W. (2d) 356; Bunde v. Bunde (1955), 270 Wis. 226, 70 N. W. (2d) 624; Borchers v. Borchers (1949), 254 Wis. 302, 36 N. W. (2d) 79.

        Kronforst v. Kronforst (1963), 21 Wis. (2d) 54, 123 N. W. (2d) 528; Schneider v. Schneider (1961), 15 Wis. (2d) 245, 112 N. W. (2d) 584.

        Brackob v. Brackob (1952), 262 Wis. 202, 54 N. W. (2d) 900.

        Kronforst v. Kronforst, supra; Miner v. Miner (1960), 10 Wis. (2d) 438, 103 N. W. (2d) 4; Bunde v. Bunde, supra.

        Kronforst v. Kronforst, supra.

        Kronforst v. Kronforst, supra; Trowbridge v. Trowbridge (1962), 16 Wis. (2d) 176, 114 N. W. (2d) 129; Knutson v. Knutson (1961), 15 Wis. (2d) 115, 111 N. W. (2d) 905.


author: Dieterich, J.

text:
    Knight and another, Appellants, v. Hasler and another, Respondents.

      April 27

    June 2, 1964.

      For the appellants there was a brief and oral argument by Burton A. Strnad of Milwaukee.
    For the respondents there was a brief by Wickham, Borgelt, Skogstad & Powell, attorneys, and Clayton R. Hahn of counsel, all of Milwaukee, and oral argument by Mr. Hahn.

   Dieterich, J.

There are two issues raised on the instant appeal: (1) Whether the trial court committed prejudicial error in allowing testimony as to the plaintiff Ruth Knight’s prior accidents, injuries, and claims; and (2) whether there is credible evidence to support the jury’s verdict. Because we have determined that the case must be reversed on the first of these issues, it is unnecessary to discuss the evidence pertaining to the accident itself. Suffice it to say that both parties gave contradictory versions of the facts, and that defendant Hasler’s testimony at the trial contradicted earlier statements made by him to police officers shortly after the collision occurred.

After plaintiff Ruth Knight had testified on direct examination as to the facts surrounding the accident and her injuries, counsel for the defendants began the cross-examination by asking her when she first contacted her attorney in connection with making a claim for the injuries. She replied that her husband had contacted her brother-in-law, who is an attorney, within a week after the accident. The following then occurred:

By Mr. Hahn:
“Q. . . . were you involved in an accident in March of 1960? A. Yes.
“Q. And did that accident occur while you were an operator of an automobile?”
By Mr. Strnad:
“I will object to that; irrelevant, if her husband or brother or anybody else was operating the automobile, so far as this accident is concerned.”
By the Court:
“Objection overruled. Witness may answer. This is limited, of course, to being tied up to the present injuries. All right, proceed.”
By Mr. Hahn:
“Q. The question is, you were in an automobile accident in March of 1960? A. I was seated behind the wheel of one.
“Q. And that automobile was struck from the rear, was it not ? A. While I was parked.
“Q. The question is, that automobile was struck from the rear, was it not? A. Yes.
“Q. And as a result of being struck from the rear, you claim that you sustained certain injuries in that accident? A. I did.
“Q. And in connection with that accident you, in fact, made a claim, did you not? A. Yes.
“Q. And in connection with that accident you were represented by Mr. Strnad, were you not? A. No.”
By Mr. Strnad:
“I object to all of this as irrelevant and immaterial, if we represented them one or a hundred times before. It has nothing to do that’s relevant with this action.”

After hearing arguments of counsel outside the presence of the jury, the trial court allowed the testimony to stand, stating that evidence of prior claims in 1960 for the same type of back injuries would be material, and that the fact that claims were made for these injuries would go to the credibility of the witness. The jury came back, and Ruth testified that she was represented by her present counsel’s partner in her prior claim for back injuries. Ruth was then questioned as follows:

By Mr. Hahn:
“Q. You also had another injury in 1959, did you not?”
By Mr. Strnad:
“What type of injury? Object; indefinite and uncertain.”
By Mr. Hahn:
“Q. Did you have any type of injury?”
By Mr. Strnad:
“Object; irrelevant and immaterial.”
“A. I was pregnant at that time.”
By the Court:
“Objection overruled. Witness may answer. You may answer, Mrs. Knight.”
"A. I was pregnant in 1959 and 1960.”
By Mr. Hahn:
“Q. ... on April 13, 1959, did you sustain an injury which ultimately resulted in your making a claim for those injuries? Do you recall that on April 13,' 1959, apparently while at a restaurant, you ate some glass ?”
By Mr. Strnad:
“I object to this as irrelevant and immaterial.”
By the Court:
“At this time the court will permit the witness to answer the question. Objection is overruled.”
“A. I purchased a pie. I did not eat glass in a restaurant. I purchased a pie that was baked with ground glass by a cook who had been fired that day who baked three pies with ground glass and I did eat that pie and my son ate that pie.”
By Mr. Hahn:
“Q. So, in answer to my question, you did have an injury claim in April of 1959? You made a claim for the injury that you had then ? A. Yes, on the assumption — ”
By Mr. Strnad:
“Just a minute. I object.”
By the Court:
“Witness’ answer may stand, but it would appear that this is immaterial to the rest of the issues and further exploration of the details would be foreclosed to the defendant unless there is a proper showing. . . .”
By Mr. Hahn:
“Q. . . . Did you fall at one time, which you claim resulted in a miscarriage, and did that occur in 1954?”
By Mr. Strnad:
“Object. Irrelevant and immaterial whether she fell and it caused a miscarriage. It has no relationship to this action.”
By the Court:
“Objection overruled at this time. Can you answer the question ?
“A. Yes, I had a miscarriage in 1954.
“Q. As a result of a fall? A. I fell in a Gas Company hole six foot deep.”
By Mr. Hahn:
“Q. And as a result of that fall you made a claim for the injuries which you sustained?”
By Mr. Strnad:
“Object. Irrelevant and immaterial whether she made any claim.”
By the Court:
“Objection is sustained.”

The remainder of Ruth Knight’s cross-examination concerned itself solely with facts relating to the manner in which the collision occurred.

After all the testimony was in, plaintiff Ruth Knight requested that the trial court give the following instruction to the jury:

“There has been certain testimony regarding other hospital confinements, injuries, sicknesses and pregnancies- of the plaintiff, Ruth Knight. There is no evidence that such occurrences are in any way related to the injuries in question. Therefore, you are instructed to entirely disregard any such testimony.”

Neither this, nor any similar instruction was given.

After the verdict, the plaintiffs moved for a new trial on grounds (among others) that the trial court erred in allowing testimony of past accidents and claims. The motion was denied, and the trial court stated that although questions concerning previous claims were improper, there was no error in the rulings on the evidence, and the plaintiffs were not prejudiced in any way.

Respondents have advanced no argument as to why evidence of past claims should be admissible, although they do contend that the similarity between the operative mechanical forces and the injuries suffered in the 1960 accident and the forces and injuries present in the instant action, renders these matters proper subject for development on cross-examination. However, the record does not reveal that counsel made any attempt to connect the 1960 injuries to the injuries allegedly suffered as a result of the collision which is the subject of the instant action. The questions directed to the plaintiff concerning the 1960 accident concerned whether she had been driving at that time, whether she was struck from the rear, whether she had been represented by a particular attorney, etc. The only question relating to the injuries suffered in the 1960 accident was whether she had claimed “back injuries.” Thus, no foundation was laid for questions dealing with the nature of the injuries suffered in the 1960 accident.

The record also contains testimony relating to past injuries wholly unrelated to the circumstances of the instant action — injuries allegedly arising out of a tumble into a gas company hole in 1954, and plaintiff Ruth Knight’s eating food containing particles of glass in a restaurant in 1959. Neither of these injuries are in any way related to the injuries claimed by Ruth in the instant action, and no foundation was laid for their admission into evidence. The trial court erred in allowing such testimony to stand.

The trial court also permitted testimony as to claims filed by the plaintiff for injuries suffered in all three past accidents. It is true that counsel’s objection to a question concerning a claim filed in 1954 for injuries suffered when Ruth fell into a gas company hole was sustained. However, her affirmative answers to questions dealing with alleged claims for injuries sustained in a 1960 automobile accident and in the 1959 glass-eating episode, were already in the record. While counsel did not object to the question concerning the 1960 automobile accident claim, his objection to the relevancy of any testimony as to the glass-eating episode was overruled, and the trial court permitted Ruth’s testimony that she filed a claim for these injuries to stand over objection by counsel for the plaintiff.

Although the trial court evidently attempted to exclude prejudice from the proceedings by warning counsel that such questions were immaterial, and precluding further inquiry along these lines, the jury was not instructed to disregard such testimony, and, even if the jury had been so instructed, it is doubtful whether this would have been sufficient to negate the total cumulative effect of the prejudicial evidence on the minds of the jurors. See Schober v. Milwaukee (1963), 18 Wis. (2d) 591, 595, 119 N. W. (2d) 316. The trial court’s refusal to instruct the jury to disregard this testimony only sealed the damage that had already been done.

The record reveals substantial inconsistencies between defendant Hasler’s statements at the time of the collision and his testimony at the trial, and also contains substantial medical testimony as to the extent of Ruth’s injuries, yet the jury set Ruth’s damages at $750, and found her 70 percent negligent. We determine, upon a reading of the record as a whole, that the trial court committed reversible error in allowing defendants’ counsel to cross-examine the plaintiff Ruth Knight to show that she had, at other times, made claims against third persons for injuries sustained by her on other occasions. Because we reverse and grant a new trial on grounds of error in the admission of certain testimony, it becomes unnecessary to consider the other questions raised.

By the Court. — Judgment reversed, and cause remanded for a new trial upon all the issues.


author: GordoN, J.

text:
    Doolittle and wife, Respondents, v. Western States Mutual Insurance Company and others, Appellants.

      April 28

    June 2, 1964.

      For the appellants there was a brief by Mittelstaed, Heide, Sheldon & Hartley and William A. Sheldon, all of Kenosha, and oral argument by William A. Sheldon.

    For the respondents there was a brief by Heft, Coates, Boggs & Heft of Racine, and oral argument by Carroll R. Heft.

   GordoN, J.

The appellants contend that the jury’s damage awards were excessive. They also urge that various errors were committed during the trial which provoked the allegedly excessive damage awards.

At the time of trial, which was approximately three years after the date of the accident, Myra Doolittle was seventy years of age, and George Doolittle was seventy-two years of age. There was evidence that before the accident they were both active individuals and generally in good health. They lived in Arizona and traveled extensively. Since the accident, their activities have been decreased, particularly with reference to travel.

The principal argument of the appellants seems to be that Mr. and Mrs. Doolittle, by reason of their advanced age, are simply not entitled to awards of $7,500 and $45,000, respectively, because of the short life expectancy which remains for each of them. Based on their ages at the time of trial, Mrs. Doolittle’s life expectancy was 8.48 years and Mr. Doolittle’s was 7.55 years. Appellants’ counsel has urged upon us the argument that the purpose of damage is not to “create an estate for the injured party.”

While age and life expectancy are entirely proper items for consideration in the assessment of damage awards, it does not follow that persons of advanced years are to be foreclosed from receiving substantial awards. If it were once a fact, it surely is no longer true that a septuagenarian is expected to exist in a semiuseless state until the Grim Reaper inevitably arrives. Medical advances along with a better understanding about retirement and the use of leisure time have transformed the so-called “golden years” into the geriatric millennium which Robert Browning so familiarly described in “Rabbi Ben Ezra.” Dr. Oliver Wendell Holmes was probably more correct than he himself realized when he wrote, “Age, like distance, lends a double charm.”

We will examine the injuries which the respondents sustained and then will consider the various contentions as to errors committed during the trial.

Injuries of Myra Doolittle.

Myra Doolittle was hospitalized after the accident for almost three months. As a result of the accident, she sustained fractures to several ribs, she incurred amnesia, and there was an injury to her head which left a scar of seven inches running across her forehead. She also sustained a punctured lung. Her left arm and right leg were both fractured. Both the arm and the leg were set without a general anesthetic. A perfect alignment of the bones was not attained, although casts were applied to both limbs.

Dr. Horsley, an internist, testified that she sustained a cardiac condition as a direct result of the accident. As further results of the accident, she developed a condition known as hammertoes on her right foot and also a bladder condition which necessitated frequent urination.

While hospitalized, Mrs. Doolittle was provided with a nasal catheter so that oxygen could be furnished to assist her in breathing, and she also was provided with a urinary catheter because of her semicomatose condition.

When examined shortly before trial by the orthopedist who had treated her after the accident, he found that she still limped on her right leg and that there was a backward angulation located just above her right ankle. This doctor testified that as a result of her arm fracture she would have a 10 percent permanent partial disability at the level of the shoulder as compared to amputation. He also testified that with reference to her right leg she would sustain a 25 percent permanent partial disability at the level of the ankle as compared to amputation.

In describing her injuries, Mrs. Doolittle testified that she had difficulty walking because of her hammertoes and because of the leg fracture. She also testified that when walking her leg was frequently tender. With reference to the fractured ribs, she testified that she had discomfort to such an extent that she could not tolerate the pressure of a blanket on her chest.

Injuries of George Doolittle.

George Doolittle was hospitalized for a period of approximately two months after the accident. He sustained a compound fracture of the right thumb; the orthopedist who treated him concluded that it represented a 15 percent permanent partial disability as compared to amputation. He also had numerous fractured ribs. He suffered from amnesia.

Oxygen was administered to George Doolittle by means of a nasal catheter. This was occasioned by the fact that he had difficulty in breathing and was short of breath. The rib fractures created a chest deformity which took the form of a flattening of the left side of his upper chest.

Without reference to the alleged errors which appellants contend occurred at the trial, we are persuaded that the jury’s award of $45,000 to Myra Doolittle as approved by the trial court represents a reasonable figure based upon the injuries which she sustained in the accident. We also consider that the jury’s award of $12,500 for the injuries to George Doolittle and reduced by the order of the trial court to $7,500 represents a reasonable award for the injuries which he sustained.

Alleged Errors During Trial.

The trial court instructed the jury relative to recovery for future pain and suffering. Upon this appeal, the appellants urge that this was error and that it contributed to the claimed excessiveness of the damages which were awarded by the jury.

The issue as to the alleged impropriety of the instruction was not raised at any time until this appeal. Objection was not made either in advance of or immediately after this instruction was given, nor was the alleged error called to the attention of the trial court on motions after verdict. Accordingly, the appellants are precluded from having this court pass on the alleged error as a matter of right pursuant to Wells v. Dairyland Mut. Ins. Co. (1957), 274 Wis. 505, 80 N. W. (2d) 380. We find no reason for exercising a discretionary power to examine the alleged erroneous instructions, and, accordingly, we conclude that there has been a waiver as to this claimed error.

The appellants also contend that a prejudicial error occurred when respondents’ counsel in his argument to the jury stated that if Joyce Muldoon (the deceased driver of the other car) were alive, she would want to see the Doolittles compensated. This remark obviously was beyond the evidence in the case, and the trial court correctly sustained an objection to it and also instructed the jury to disregard it. We do not believe that there was any prejudicial effect as a result of this occurrence.

Appellants further urge that error occurred when the trial court failed to instruct the jury to disregard certain testimony relating to George Doolittle’s heart condition. A motion was successfully made in chambers by appellants’ counsel to strike the testimony regarding his heart condition, but no reference to the motion or the ruling thereon was presented to the jury. There was no express request made by appellants’ counsel that an instruction be given to the jury to disregard the stricken testimony. In our opinion, it would have been proper for the trial court to have instructed the jury to disregard this testimony, but the appellants are precluded from predicating error thereon in view of their failure to make a specific request therefor.

A further objection relates to the type of argument employed by the jury by respondents’ counsel concerning damages. The appellants’ contention is that respondents’ counsel used an improper formula contrary to Affett v. Milwaukee & S. T. Corp. (1960), 11 Wis. (2d) 604, 106 N. W. (2d) 274. From the trial court’s decision, we conclude that through rhetorical questions respondents’ counsel suggested certain dollar figures for the several types of injuries. Presumably, he suggested separate figures for the broken leg, the fractured ribs, etc.

In the Affett Case, this court held that it was improper to use a mathematical formula arrived at on a time-segmented basis. We refused to broaden the restriction of the Affett Case in Holsted v. Kosnar (1963), 18 Wis. (2d) 348, 118 N. W. (2d) 864. We are now confronted by the question whether it is proper for counsel to propose several lump sums for separate injuries or whether he must confine himself to a single lump sum.

In our opinion, where there are two or more distinct items of injuries, as in the instant case, it is proper for the trial court to permit argument to the jury whereby a separate sum is urged upon the jury for each of such injuries.

By the Court. — Judgment affirmed.


text:
    Silverberg, Appellant, v. Industrial Commission, Respondent.

      April 28

    June 2, 1964.

      For the appellant there was a brief by Glassner, Clancy & Glassner of Milwaukee, and oral argument by William E. Glassner, Jr.

      For the respondent Industrial Commission the cause was argued by Beatrice Lampert, assistant attorney general, with whom on the brief was George Thompson, attorney general.
   Beilfuss, J.

The petitioner contends he is entitled to an employment agent’s license; the commission contends that the application should be denied. Both parties to this appeal agree that the disputed issues should be resolved upon the record as it now appears and that the matter should not be remanded to the commission for further evidentiary consideration.

The principal statute involved is sec. 105.13 :

“Refusal to issue and revocation of license. It shall be the duty of the industrial commission, and it shall have power, jurisdiction and authority to issue licenses to employment agents, and to refuse to issue such license whenever, after due investigation, the commission or a majority of the members thereof finds that the character of the applicant makes him unfit to be an employment agent, or when the premises for conducting the business of an employment agent is found upon investigation to be unfit for such use, or whenever, upon investigation by the commission, it is found and determined that the number of licensed employment agents or that the employment agency operated by the United States, the state or by the municipality or by two or more thereof jointly in the community in which the applicant for a permit proposes to operate is sufficient to supply the needs of employers and employes. Any such license granted by the commission may also be revoked by it upon due notice to the holder of said license, and upon due cause shown. Failure to comply with the duties, terms, conditions or provisions of sections 105.01 to 105.15, inclusive, of the statutes, or with any lawful orders of the commission, shall be deemed due cause to revoke such license.”

The statute directs the commission to issue a license and to refuse to do so if after investigation the commission or a majority of the members find (1) the character of applicant makes him unfit, or (2) the premises for conducting the business are unfit, or (3) that the number of licensed'agencies, including state, federal, or municipal agencies operating in the community, is sufficient to meet the needs of employers and employees.

The first grounds for refusal were resolved in favor of the petitioner and are not in dispute. Our consideration is limited to the third ground of refusal under the statute, i.e., whether the needs of employees and employers are sufficiently supplied.

The court has considered this portion of the statute on previous occasions. In Graebner v. Industrial Comm. (1955), 269 Wis. 252, 68 N. W. (2d) 714, we decided that the statute was constitutional in that it did not violate the due-process clause of the Fourteenth amendment and that it was a valid delegation of legislative authority.

“The business of conducting an employment agency is a legitimate one in which all persons similarly situated are lawfully entitled to engage, but it is one which is so far concerned with the welfare of the public that it is within the police power of the state to regulate it. State v. Howard W. Russell, Inc., 181 Wis. 76, 194 N. W. 43. Such power carries with it the right to require that one who desires to engage in the business shall have a license therefor. It is also the established law that a legislative act may validly confer upon an agency of the government authority to grant or to withhold a license, provided that, where discretion is to be exercised by such agency, proper standards or guides for the use of the discretion are established by the act and that the act may not be construed as conferring upon the agency the power to exercise its discretion unreasonably, arbitrarily, or capriciously. Mehlos v. Milwaukee, 156 Wis. 591, 146 N. W. 882. (p. 255.)

“The statute involved in the instant case must be given similar construction. The standards prescribed are that the license is to be refused if the character of the applicant makes him unfit to be an employment agent or when the premises whereon he purports to operate is found to be unfit for use, or if the community in which he proposed to operate is adequately served by existing agencies. Upon the authority of the Wisconsin cases to which we have referred we must hold that the statute, in so far as it empowers the commission to grant or to refuse a license under the circumstances prescribed, is valid.” (p. 257.)

In oral argument petitioner has asked us to re-examine and overrule the Graebner Case, supra. While we are not precluded from a re-examination of a former case upon request at oral argument, we determine upon the record before us, it is inappropriate to do so in this instance.

The controlling case here is Harding v. Industrial Comm. (1961), 12 Wis. (2d) 274, 107 N. W. (2d) 273, 108 N. W. (2d) 155.

In the Harding Case we determined that a public hearing was required before an application for an employment agency license could be denied and reasserted the standards to be used by the commission as set forth in Graebner.

“If, on the other hand, the refusal of a license under sec. 105.13, Stats., be considered the final decision of the commission, without any possibility of gaining a hearing under sec. 101.15, sec. 105.13 should be construed as requiring a hearing before refusal of a license. Notwithstanding the use of the term ‘investigation’ as the basis for the findings, the commission has proceeded in the past as if the word were ‘hearing.’ Doubts would arise as to the validity of excluding persons from a lawful business by reason of determinations of fact reached without a hearing. Both the administrative practice, and the doubts referred to would support the construction that the investigation must take the form of a hearing.

“In this case, we are concerned only with the third ground for refusal specified in sec. 105.13, Stats., i.e., whether the needs of employers and employees in the Milwaukee community are sufficiently supplied.

“The validity of empowering the Industrial Commission to refuse a license upon a finding that such needs are sufficiently supplied by existing agencies was sustained in Graebner v. Industrial Comm. (1955), 269 Wis. 252, 68 N. W. (2d) 714. In discussing the standard for the exercise of the commission’s power, the court said, at page 258:

“ We agree that the commission shall consider both the quality and the quantity of the service rendered and whether or not that would be improved by the grant of additional permits.’ ” (pp. 277, 278.)

The scope of review of administrative agency findings and the problems in respect thereto have been recently stated in Copland v. Department of Taxation (1962), 16 Wis. (2d) 543, 553-555, 114 N. W. (2d) 858.

“The majority and dissenting members of this court are in full agreement as to the principles of law governing the scope 'of judicial review of an agency’s findings of fact under the Wisconsin Administrative Procedure Act (ch. 227, Stats.). The controlling statute is sec. 227.20 (1) (d), which authorizes a reviewing court to reverse or modify an agency decision if substantial rights of the aggrieved party have been prejudiced as a result of the administrative findings being ‘unsupported by substantial evidence in view of the entire record as submitted! (Italics supplied.)

“Thus, to apply this standard we must first determine what is meant by ‘substantial evidence.’ E. Blythe Stason, in an article entitled ‘Substantial Evidence’ in Administrative Law, 89 University of Pennsylvania Law Review (1941), 1026, 1038, states:

“ ‘[T]he term “substantial evidence” should be construed to confer finality upon an administrative decision on the facts when, upon an examination of the entire record, the evidence, including the inferences therefrom, is found to be such that a reasonable man, acting reasonably, might have reached the decision; but, on the other hand, if a reasonable man, acting reasonably, could not have reached the decision from the evidence and its inferences then the decision is not supported by substantial evidence and it should be set aside.’
“This court, in Gateway City Transfer Co. v. Public Service Comm. (1948), 253 Wis. 397, 405, 406, 34 N. W. (2d) 238, quoted from Consolidated Edison Co. v. National L. R. Board (1938), 305 U. S. 197, 59 Sup. Ct. 206, 83 L. Ed. 126, to the effect that ‘substantial evidence’ is ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’ (Emphasis supplied.)
“We deem that the test of reasonableness is implicit in the statutory words ‘substantial evidence.’ However, in applying this test the crucial question is whether a reviewing court is only to consider the evidence which tends to support the agency’s findings, or whether it is also to consider the evidence which controverts, explains, or impeaches the former. Use of the statutory words ‘in view of the entire record as submitted’ strongly suggests that the test of reasonableness is to be applied to the evidence as a whole, not merely to that part which tends to support the agency’s findings. This court so interpreted sec. 227.20 (1) (d), Stats., in Albrent Freight & Storage Co. v. Public Service Comm. (1953), 263 Wis. 119, 128, 56 N. W. (2d) 846, 58 N. W. (2d) 410, and Motor Transport Co. v. Public Service Comm. (1953), 263 Wis. 31, 45, 56 N. W. (2d) 548. See also 4 Davis, Administrative Law Treatise, pp. 129, 130, sec. 29.03.
“It is a commonly accepted principle that a reviewing court should not pass on the credibility of witnesses nor the weight of the evidence, because these lie exclusively within the province of the agency. Likewise, a reviewing court is not to substitute its judgment for that of the agency where, in evaluating conflicting evidence in a field in which the agency possesses expertise which the court does not, the agency probably has employed its expert knowledge. However, in reviewing an agency finding, drawing a line between a weighing of the evidence and the evaluation of its reasonableness presents an illusive problem.”

In applying the “substantial evidence” rule to the standard that the commission shall “consider both the quality and the quantity of the service rendered and whether or not that would be improved by the grant of additional permits,” we conclude in view of the entire record reasonable minds must agree that the quality and quantity of service rendered would be improved and as such be beneficial to the needs of employers and employees.

The words of the statute are that the license is to be denied if existing agencies are “sufficient to supply the needs of employers and employes.” We conclude the legislature intended that competent and well-regulated employment agencies which would add to the quality and quantity of employment services so as to supply a need sought by employers or employees should be granted an employment agency license.

Applying these tests to the entire record before us, we conclude that the petitioner has established that the employment services he proposes to render will improve the quality and quantity of employment services to a significant number of prospective employers and employees. The fact that services now available may to some degree overlap those proposed by the petitioner does not negate the inference that the quality and quantity of the services to be offered will be beneficial to employers and employees. Nor does this record permit a reasonable inference that detrimental or unfair competition will result. An employment agent’s license should be granted to the petitioner.

An amicus curiae brief has been filed. The brief seeks to challenge the validity of testimony in the record by statements and assertions. This is not a proper function of amicus curiae. The brief is, therefore, stricken from the record.

By the Court. — Judgment reversed, cause remanded with directions to reverse the decision of the Industrial Commission and to remand the proceeding to the commission for further proceedings, not inconsistent with the opinion filed herein. The brief amicus curiae will be stricken from the record.

Wilkie, J., took no part.

        Graebner v. Industrial Comm., supra, p. 258.


text:
    Ritter, by Guardian ad litem, Respondent, v. Coca-Cola Company (Kenosha-Racine), Inc., Appellant.

      April 28

    June 2, 1964.

      For the appellant there was a brief by Mittelstaed, Heide, Sheldon & Hartley and William A. Sheldon, all of Kenosha, and oral argument by William A. Sheldon.

    For the respondent there was a brief by Foley, Capwell, Foley & Kolbe of Racine, and oral argument by Rex Cap-well.

   Wilkie, J.

The entire controversy on this appeal concerns the medical testimony of Dr. Bacon. At the trial, he testified that Miss Ritter had consulted him on March 16, 1961.

Miss Ritter’s counsel then asked: “Q. And what did she relate to you at that time Doctor ?”

At this point, appellant’s counsel objected to Dr. Bacon testifying as to what subjective symptoms Miss Ritter related to him, on the ground that since Miss Ritter had already retained counsel for the purpose of commencing an action in relation to the mouse-in-the-bottle episode, her visit to Dr. Bacon could only be viewed as undertaken for the purpose of securing expert testimony to support her cause of action, rather than seeking treatment, and that under the Kath rule, testimony by a physician relating to a party’s report of “subjective” symptoms to him is inadmissible unless the consultation with the physician is undertaken solely for the purpose of treatment.

The trial court overruled appellant’s objection.

Dr. Bacon then testified as to Miss Ritter’s report to him as to the details of the episode, and her feelings and responses immediately surrounding the event. He further testified as to Miss Ritter’s report to him in relation to her continuing symptoms of avoidance of nontranslucent liquids, inability to sleep, troubled dreams, and fear of mice. Dr. Bacon concluded to a reasonable medical certainty that these indicia of psychological stress were causally related to the episode of March 2, 1961.

The first issue presented on this appeal is whether Coca-Cola’s claim of error was properly preserved for appeal to this court.

In his motion for a new trial after verdict, appellant’s counsel simply alleged, among other grounds, that a new trial was justified “because of error of trial in the receipt of evidence.” Because the motion papers do not specify in detail the precise nature of the evidentiary error, the appellant did not properly preserve the alleged error for appeal to this court, assuming that his allegation was not elaborated by oral argument or briefs on motions after verdict.

While appellant did not in fact elaborate his allegation of evidentiary error by means of oral argument or brief, it is clear that he was not given an opportunity to do so, though he made such request.

Appellant’s only notice of the July 2d hearing set for argument on motions after verdict was contained in the respondent’s motion papers. Although the appellant asked the court to set a time for argument on its motion, and to provide an opportunity to be heard, the trial court did not directly apprise the appellant’s counsel of the time for argument. Because counsel was denied an opportunity to present his claim of error as the basis for his motion for a new trial, we exercise our discretionary power under sec. 251.09, Stats., to consider the merits of appellant’s claim.

Therefore, the second, and major, issue raised on this appeal is: Was Dr. Bacon’s testimony relating to Miss Rit-ter’s report of her feelings, anxieties, and dream content, properly admitted into evidence ?

In Kath this court held that a physician may not testify as to statements made by a patient to him regarding subjective symptoms connected with his injury, if in addition to seeking treatment for his injury the patient is motivated to seek consultation for the purpose of obtaining expert medical testimony. The applicability and extent of the Kath rule has been the subject of further rulings by this court. In Schields v. Fredrick this court applied and extended Kath when it ruled that a physician, consulted for the first time on the day before trial to testify as to the injuries of one of the parties, could not testify either as to a history of the injuries given to the doctor by the claimant or as to subjective symptoms as narrated to him by the claimant, and when the court further held that the doctor could not give his medical opinion, based in part on these statements, as to the relation between the accident and the injuries and related discomfort.

In La Fave v. Lemke the court distinguished Kath when the family physician, who did not see the injured person until three days after the accident, was permitted to testify about what the claimant told him about areas of his body that were painful. The court said (p. 509) that the “so-called recitation of subjective symptoms amounts to no more than a direction of the doctor’s attention to the parts to be examined.”

In Thompson v. Nee the court found that the claimant had gone to a neurosurgeon for treatment only and the doctor was then allowed to testify about subjective symptoms told to him by the patient who, for several months after the accident, had undergone treatment by orthopedic surgeons who did not relieve the injury.

In Plesko v. Milwaukee, supra, testimony of a physician who was first consulted four years before trial but one year after injury, was admitted as to subjective symptoms related to the physician during all his examinations throughout the years, except for symptoms stated to the doctor during the final examination on the day before trial (excluded on authority of Schields).

In Rasmussen v. Metropolitan Casualty Ins. Co. and in both Thompson and Plesko, the fact that a person had retained counsel in relation to a possible lawsuit arising out of the injury-producing event prior to consulting a physician was held not in and of itself to support an inference that he was seeking objectives other than treatment when he consulted the physician.

Essentially under these rulings, the holding in Kath has been retained while at the same time allowing a doctor to testify as to a patient’s subjective symptoms recited to the doctor during a consultation, which consultation, according to evidence in the record, by inference, may have been arranged for the twofold purpose of treatment plus examination prior to testifying but concerning which the trial court has ruled that the sole motivation of the claimant in arranging for the consultation was treatment. We see no logic in continuing in adherence to the Kath rule and conclude that if the trial court determines that a consultation is made by a claimant with a physician for the bona fide purpose of treatment, the fact that the claimant also desires to utilize the physician as a witness on the trial in relation to his injury will not preclude the physician from testifying as to the patient’s report of his subjective symptoms or from predicating medical conclusions upon such reports.

Such a change in the Kath rule simply recognizes the realities of modern medical practice in the clinical diagnosis of a patient’s condition alleged to be due to the injury-causing event and prescribing treatment for such condition. Every physician consulting with a patient who is alleged to have been injured takes the patient’s history and. makes his diagnosis based not only on his objective findings made on examination, but also with due regard to the statements made by the patient both as to his history and as to his subjective complaints. The physician brings to the diagnosis his clinical evaluative skills, which he has acquired through rigorous professional training and extensive clinical experience.

The rationale of the Kath rule regards statements made by the patient to the physician as hearsay and in the nature of self-serving declarations. Kath allows testimony concerning such statements where made to a physician while undergoing treatment, but excludes the testimony where dual motivation is established. This distinction is unrealistic. If the testimony on statements made in one context is admissible then logically such testimony should also be admissible where the statements are made in the other context.

As long as a patient goes to a physician with the bona fide purpose of receiving treatment, the basic desire of a patient to get well, we believe, will generally motivate him to tell the truth and this is sufficient reason to allow the attending physician to testify about statements made to him which may touch on his history and his subjective symptoms. Cross-examination and argument are available to opposing counsel as a means of testing such testimony. Under the circumstances of this case, Miss Ritter can be deemed to have only been seeking psychotherapeutic treatment when she consulted with Dr. Bacon on March 16, 1961. There was no testimony to the contrary. The injury-producing event occurred two weeks prior to the consultation. On the day after the incident, Miss Ritter had consulted Dr. Duncan, who informed her that she had sustained no toxic or physiological injury. When her symptoms persisted, Miss Ritter then consulted Dr. Bacon as a psychiatrist, with a view of obtaining psychotherapeutic relief for her symptoms. It was over two years after this consultation that Dr. Bacon was actually called upon to testify.

Under Kath, either as applied prior to this decision or as modified herein, it is clear that Dr. Bacon could properly testify as to Miss Ritter’s statements to him relating to her subjective emotional experience, and could properly predicate his medical conclusion as to the causal relationship between the episode in issue and her emotional and psychological distress upon such reports.

Appellant’s request for a new trial in the interests of justice must therefore be denied.

By the Court. — Judgment affirmed.

        Kath v. Wisconsin Central R. Co. (1904), 121 Wis. 503, 99 N. W. 217. Thompson v. Nee (1961), 12 Wis. (2d) 326, 107 N. W. (2d) 150. Plesko v. Milwaukee (1963), 19 Wis. (2d) 210, 120 N. W. (2d) 130.

        Plesko v. Milwaukee, supra; Michalski v. Wagner (1960), 9 Wis. (2d) 22, 100 N. W. (2d) 354; Wells v. Dairyland Mut. Ins. Co. (1957), 274 Wis. 505, 80 N. W. (2d) 380.

        Kath v. Wisconsin Central R. Co., supra.

       (1939), 232 Wis. 595, 288 N. W. 241.

       The physician may nevertheless give his medical opinion on the basis of a proper hypothetical question, which is predicated on the subjective symptoms if such have been put in evidence by the direct testimony of the claimant. Kreyer v. Farmers’ Co-operative Lumber Co. (1962), 18 Wis. (2d) 67, 117 N. W. (2d) 646.

       (1958), 3 Wis. (2d) 502, 89 N. W. (2d) 312.

       (1961), 12 Wis. (2d) 326, 107 N. W. (2d) 150.

       (1953), 264 Wis. 432, 59 N. W. (2d) 457.


author:
Currie, C. J.
      Dieterich, J.

text:
    Estate of Sieben: Sieben, Executor, Appellant, v. Phillips, Respondent.

      April 28

    June 2, 1964.

      For the appellant the cause was submitted on the briefs of Franklin J. Kirgues, attorney, and Rudolph L. Forrer of counsel, both of Milwaukee.
    For the respondent there was a brief and oral argument by Bertram J. Hoffman of Milwaukee.
   Currie, C. J.

The trial court determined that the instant case is governed by Estate of Ogg (1952), 262 Wis. 181, 54 N. W. (2d) 175, while the appellant executor contends Estate of Braasch (1957), 274 Wis. 569, 80 N. W. (2d) 759, controls.

The facts of the present case parallel those in the Ogg Case in one respect and differ in others. The clauses of both wills, which expressed a desire that a named attorney be retained to probate the estate, stressed that such attorney had an intimate knowledge of testator’s affairs. However, the Ogg will named no executor, and the corporate fiduciary, which was appointed administrator with the will annexed, had no objection to employing the attorney named in the will as its counsel to probate the estate. The instant will, on the other hand, does name an executor, to whom letters testamentary have been issued, and this executor objects to employing the attorney named in the will. We deem that these two differences considered together, are sufficient to distinguish the instant case from the Ogg Case and militate against the latter’s being controlling of the result here.

We are satisfied that Estate of Braasch, supra, rules the instant case and requires reversal of the order appealed from. The provision in the Braasch will, which requested the executor to retain a particular attorney to probate the estate, did not recite that such attorney was familiar with the testator’s affairs, while the instant will contains such a recitation. In the absence of such a recitation it will be assumed that testator had some legitimate reason which prompted him in requesting that a particular attorney be employed by the executor. Thus, we do not consider the absence of such a recitation sufficient to render inapplicable the holding in the Braasch Case that the executor was not required to employ the named attorney if the executor was unwilling so to do. In that case we considered the alternative of the executor’s resigning in the event he was unwilling to employ the named attorney, and stated (274 Wis. at page 573) :

“Because of the essential character of the function of the executor, and the gravity of the trust reposed in him, and because the attorney does not act independently, but advises and renders professional services to the executor, we reach the conclusion that the intent expressed in the Braasch will was that Robert should serve as executor even though unwilling to retain the attorney named.
“The question was argued before us whether the word ‘request’ should be interpreted as the equivalent of the word ‘direct’ or some similar term literally more mandatory than ‘request.’ We do not base our conclusion upon this choice of words. In proper context words indicating a wish, desire, or request have frequently been held to convey a testamentary intent. Knox v. Knox, 59 Wis. 172, 18 N. W. 155; Wolbert v. Beard, 128 Wis. 391, 107 N. W. 663; Will of Platt, 205 Wis. 290, 237 N. W. 109; Estate of Ogg, supra; 1 Page, Wills (lifetime ed.), pp. 200-202, sec. 91. But we cannot say that the Braasch will expresses an intent that the executor must either employ a particular attorney or decline to act as executor.”

This holding controls the instant situation where the testator names the executor and the attorney the executor is to employ, but does not indicate any preference between the two. In the absence of a statement of intent in the will that a named attorney be employed by the personal representative even at the cost of the resignation of the personal representative, an executor is not required to employ an attorney in opposition to the executor’s own wishes.

We also consider it to be immaterial whether or not the executor’s unwillingness to employ the attorney named in the will is so adamant that the executor would resign his trust rather than be forced by court order to carry out testator’s request that such attorney be retained. This is because of the relationship of mutual trust and confidence that ought to exist between client and attorney. We deem particularly apposite this statement of the Minnesota court in the recent case of State ex rel. Seifert v. Smith (1961), 260 Minn. 405, 417, 110 N. W. (2d) 159:

“While admittedly relators [the firm of attorneys named in the will], in the instant case, are perfectly competent and suitable to handle the probating of any will, we nevertheless are of the opinion that an executor should not be forced against his will to employ an attorney upon whose judgment he does not wish to depend and whose advice he feels he cannot follow with confidence. Since the relationship of attorney and client is a confidential one, it must of necessity be based on mutual trust. Forcing such relationship upon the client against his will would not be conducive to an atmosphere of reciprocal confidence.”

By the Court. — The order appealed from is reversed.

Dieterich, J.

(dissenting). I must respectfully dissent from the decision of the majority.

The primary guideline in construction of a will is the intent of the testator as expressed therein. A reading of the will in the instant action leads to only one conclusion — that it was the testator’s intention to have one of the two attorneys named in Clause VI as the attorney for the estate. Thus, we start with the proposition that the intent of the testator should control. Opposing this principle is the doctrine or rule of public policy that the executor should be allowed to select the attorney in order that they may work harmoniously together in probating the estate.

In the instant action, the will itself reveals that the testator reposed singular confidence in the named attorneys because of their “complete familiarity” with his estate and financial affairs. Clause VI of the will is couched in mandatory, rather than suggestive or precatory, language, and the public-policy doctrine cannot be applied so as to overcome the clear mandate of the testator contained in his will. If the named attorney is negligent in carrying out his duties, he may be removed for cause by the executor. However, he cannot be negligent until he acts, and there is nothing in the record to indicate that he would be in any way incompetent to handle the matters entrusted to him by the will. On the other hand, the executor holds a position similar to that of a trustee, and is under a duty to carry out the wishes of the testator. He is free to decline this trust if he is not satisfied with the conditions imposed upon him by the testator.

I see no reason, either in fact or policy, to overturn the decision of the trial court, and would therefore affirm.