author: LUNDSTEN, J. DYKMAN, J.

text:
    In re the Marriage of: Jane E. Chen, Petitioner-Respondent, v. John J. Warner, Respondent-Appellant.

    Court of Appeals

      No. 03-0288.

      Submitted on briefs August 13, 2003.

    Decided May 6, 2004.

    2004 WI App 112
    (Also reported in 683 N.W.2d 468.)

      Dykman, J., dissents.
    On behalf of the respondent-appellant, the cause was submitted on the briefs of Linda Roberson, Anthony J. Lucchesi, and Laurel A. Kent of Balisle & Roberson, S.C., Madison.
    On behalf of the petitioner-respondent, the cause was submitted on the brief of James Kurth of James Kurth, S.C., Wausau.
    Before Dykman, Vergeront and Lundsten, JJ.

       Petition to review granted 9-16-04.

   LUNDSTEN, J.

¶ 1. This is a child support modification case in which one parent alleges that the other is "shirking." "Shirking" is an unfortunate term because it connotes improper behavior, but, under the case law, it encompasses behavior that is well motivated. However, we use the term to avoid confusion that might arise if we employed some other term.

¶ 2. Dr. John Warner, the father, asserts that Dr. Jane Chen, the mother, is shirking because she voluntarily and unreasonably declined to return to work after first quitting employment as a medical doctor and then watching her investment income dwindle. Instead of returning to work, Dr. Chen, who had more than a year earlier quit work to devote time to parenting, sought an order for child support from the circuit court. Dr. Warner asserts that the circuit court erred when it determined that Dr. Chen was not shirking and used her actual income to determine child support. We affirm the circuit court.

J. Background

¶ 3. Dr. Jane Chen and Dr. John Warner have three daughters, born on October 11, 1991, April 22, 1993, and July 12,1995. In 1999, after an eighteen-year marriage, the parties divorced.

¶ 4. The parties entered into a marital settlement agreement, which was later incorporated into the judgment of divorce. The parties agreed to joint custody, equal physical placement, and no child support. At the time of the divorce in 1999, both parents were employed as medical doctors in Marshfield. Dr. Chen was earning $19,670 per month, which means an annual income of $236,040. Dr. Warner was earning $21,371 per month, which translates into an annual income of $256,452.

¶ 5. Prior to and after the divorce, both parties worked full time. After persistent and unsuccessful efforts to obtain a part-time schedule so that she could spend more time parenting, Dr. Chen voluntarily quit in May of 2000. By quitting, Dr. Chen gave up her substantial current income, contributions to her retirement plan, and job security. The undisputed testimony was that she was performing at a high level and was the administrator of a profitable department. If Dr. Chen had remained in her job, she would have made $410,175 in 2002.

¶ 6. At the time Dr. Chen quit in 2000, she was advised, based on market returns over the past fifty years, that she could expect approximately 10% per year income on her investments with a conservative investment plan. Since Dr. Chen had about 1.1 million dollars in savings, she hoped to earn about $110,000 per year. She estimated her budget at $7,000 per month or $84,000 per year.

¶ 7. Unfortunately, the stock market declined dramatically in 2001 and Dr. Chen's investment income likewise dropped dramatically. That year, her total income was $32,000. Thus, Dr. Chen began to invade her principal in order to meet expenses. At the same time, Dr. Chen investigated the possibility of returning to work part-time. She was unable to locate work in the Marshfield area, and she declined to pursue part-time work in communities beyond commuting distance.

¶ 8. In January of 2002, Dr. Chen filed a motion requesting that the divorce judgment be amended to order Dr. Warner to pay child support. At that time, Dr. Warner was earning $472,000 per year and his employer contributed an additional $73,000 per year to Warner's retirement plan. During an evidentiary hearing, Dr. Chen detailed her activities with the children. Those activities are set forth in detail in the discussion section below. Dr. Chen testified that her monthly budget was about $7,000. She asked the circuit court to order child support in the amount of $4,000 per month.

¶ 9. The circuit court determined that Dr. Warner could afford to pay child support and that Dr. Chen was not shirking. The court declined to use Dr. Chen's earning capacity and ordered Dr. Warner to pay $4,000 per month in child support.

II. Discussion

¶ 10. The only issue on appeal is whether the circuit court erred when it declined to use Dr. Chen's earning capacity and instead used her actual income when determining whether and in what amount to order child support. Dr. Warner alleges "shirking." He asserts that Dr. Chen voluntarily and unreasonably chose to forgo employment and seek child support payments.

A. Standard of Review and Legal Principles Applicable to Shirking

¶ 11. Courts use earning capacity, rather than actual earnings, to determine child support and maintenance payments when the party in question is shirking. See Abitz v. Abitz, 155 Wis. 2d 161, 166, 455 N.W.2d 609 (1990). Shirking is an employment decision to reduce or forgo income that is both voluntary and unreasonable under the circumstances. Finley v. Finley, 2002 WI App 144, ¶ 15, 256 Wis. 2d 508, 648 N.W.2d 536; Sellers v. Sellers, 201 Wis. 2d 578, 587, 549 N.W.2d 481 (Ct. App. 1996).

¶ 12. The voluntariness of a decision to reduce or forgo income is a question of fact, and we do not disturb a finding of fact unless it is clearly erroneous. See Smith v. Smith, 177 Wis. 2d 128, 133, 501 N.W.2d 850 (Ct. App. 1993) (treating whether a parent voluntarily terminated his employment as factual question). A party asserting that his or her reduction in income was involuntary has the burden of proof on that topic. Id. at 134.

¶ 13. Turning to the reasonableness prong, we accord "appropriate deference" to circuit court determinations of the reasonableness of decisions to reduce or forgo income. In Van Offeren v. Van Offeren, 173 Wis. 2d 482, 496 N.W.2d 660 (Ct. App. 1992), we explained:

The issue in this case is whether [the child support payor] unreasonably terminated his employment at Johnson Wax. The legal standard of reasonableness presents a question of law. Ordinarily, an appellate court need not defer to the trial court's determination of a question of law; however, because the trial court's legal conclusion as to reasonableness is so intertwined with the factual findings supporting that conclusion, an appellate court should give weight to the trial court's reasonableness conclusion. We therefore review the trial court's ruling as a question of law, but one to which we must pay appropriate deference.

Id. at 492-93 (citations omitted); accord Sellers, 201 Wis. 2d at 587. We interpret this standard of review to mean that if the circuit court reached a conclusion that a reasonable court could reach based on the record before the court, we will defer to that conclusion. Deferring to circuit court determinations in family law cases is the norm, and we see no reason to deviate in this instance. Further, we are unable to discern any other meaning from Van Offeren. Cf. Finley, 256 Wis. 2d 508, ¶¶ 13-15 (treating shirking decision as a discretionary determination).

¶ 14. The burden of showing reasonableness is on the party who reduces or forgoes income. That party has the burden of justifying his or her decision. See, e.g., Kelly v. Hougham, 178 Wis. 2d 546, 556, 504 N.W.2d 440 (Ct. App. 1993) ("[A child support payor's] decision to leave a well-paying job to pursue his postgraduate education objectives contributed significantly to the parties' changed circumstances. He must justify his decision in light of his obligations to his children.").

¶ 15. Shirking cases typically speak in terms of shirking as an issue involving the payor. E.g., id. at 555; Smith, 177 Wis. 2d at 136; Van Offeren, 173 Wis. 2d at 492 ("Shirking is established where the obligor intentionally avoids the duty to support or where the obligor unreasonably diminishes or terminates his or her income in light of the support obligation."). However, shirking analysis also applies to a payee. See Finley, 256 Wis. 2d 508, ¶¶ 12-13 (applying shirking analysis to a payee).

¶ 16. In this case, the voluntariness of Dr. Chen's decision is not disputed. We address only the reasonableness of her decision.

B. The Reasonableness of Dr. Chen's Decision

¶ 17. Dr. Warner, the party ordered to pay child support, makes only one argument on appeal. He asserts that the circuit court erred when it declined to use Dr. Chen's earning capacity when determining whether and in what amount to order child support.

¶ 18. We begin by clarifying the "decision" at issue. Dr. Chen made decisions at two points in time. In 2000, she voluntarily quit her full-time job after failing to obtain an agreement from her employer allowing her to work reduced hours. At that time, Dr. Chen had the expectation that her savings of more than one million dollars would produce sufficient income to meet her child support obligations. In 2001, after steep declines in the markets and her investment income, Dr. Chen explored part-time work options. During this latter time period, Dr. Chen opted not to pursue work opportunities that would take her away from the children every other week. When she failed to locate part-time work that would not significantly interfere with her parenting, Dr. Chen sought child support from Dr. Warner.

¶ 19. Dr. Warner argues that both decisions, individually and collectively, constitute shirking. Dr. Chen contends that both decisions were reasonable. We, however, conclude that the appropriate focus is on Dr. Chen's most recent decision to remain unemployed.

¶ 20. So far as this record reveals, if Dr. Chen's investment plan had worked, she would not have sought child support. Moreover, Dr. Warner himself argues that regardless the reasonableness of Dr. Chen's initial decision, it was unreasonable for Dr. Chen to seek child support rather than return to work when her investment income dropped. Dr. Chen does not argue that there is no work available. As discussed below, it is undisputed that Dr. Chen could likely find work if she were willing to work in a far-off community every other week. What Dr. Chen does assert is that it was reasonable for her not to pursue such opportunities because of the benefit conferred on the children by her ability to parent when the children were not actually under the care and supervision of Dr. Warner. Thus, the pertinent question is whether Dr. Chen's decision not to pursue available work that would take her away from the children every other week was reasonable.

¶ 21. The determination of reasonableness does not involve a "set list of factors." Wallen v. Wallen, 139 Wis. 2d 217, 225, 407 N.W.2d 293 (Ct. App. 1987). Rather, courts must look to the particular circumstances of each case. The parties here debate the following factors: (1) Dr. Chen's motives; (2) whether her decision was reasonable because it was foreseeable at the time of the divorce; (3) whether Dr. Chen pursued opportunities; (4) Dr. Warner's ability to pay child support; and (5) the benefit to the children. We address each of these factors in the sections below and then explain why the circuit court's determination that Dr. Chen was not shirking is supported by the record. Before proceeding, we pause to respond to the dissent's sua sponte suggestion that this case be remanded so that the circuit court may consider whether Dr. Chen should be required to spend down some portion of her assets, rather than receive child support. We stress that it would have been reasonable for the circuit court to analyze Dr. Chen's financial situation with an eye toward assessing whether she should spend down assets before receiving child support. However, Dr. Warner has never made the argument, and we cannot fault the circuit court for failing to address it.

Dr. Chen's Motives

¶ 22. Dr. Warner does not argue that Dr. Chen acted in bad faith or with improper motives when she declined to pursue job opportunities after her investment plan failed. At the same time, Dr. Warner points out that shirking may exist in the absence of bad faith or improper motives. We agree. Even when a reduction in income is voluntary, "no bad faith need be shown for an order to be based on that spouse's earning capacity, rather than his or her actual present earnings." Roberts v. Roberts, 173 Wis. 2d 406, 411, 496 N.W.2d 210 (Ct. App. 1992); see also Van Offeren, 173 Wis. 2d at 496.

¶ 23. We turn to Dr. Chen's argument that her good motivations should weigh in favor of a reasonableness finding. Dr. Chen details evidence showing that she sacrificed much to become a full-time parent and, therefore, she must have had the children's benefit in mind, not her own. This, she contends, supports the circuit court's non-shirking decision.

¶ 24. We conclude that Dr. Chen's motivation is important, but only to the extent that it is undisputed that she was not improperly motivated. As we explained in footnote 2, a finding that an income reduction decision is motivated by a desire to avoid child support is one of many possible unreasonable reasons to reduce income. At the same time, good motives, standing alone, do not necessarily weigh in favor of reasonableness. Even well-motivated persons make unreasonable decisions.

¶ 25. To be clear, we do not hold that good motives are never relevant. Good motives may be relevant when the existence of such motives makes it more likely that some other factor does or does not exist. For example, the undisputed facts here show that Dr. Chen was actually motivated by a desire to help her children by being a much more active parent. Because benefit to the children is an issue in this case, a court might find that Dr. Chen's motivation to help the children with school issues makes it more likely that she will continue to spend substantial time assisting the children in that respect. However, in this case, there is no factual dispute on that topic. Dr. Warner has not suggested that any of Dr. Chen's testimony about her activities with the children is untrue or exaggerated. He does not. suggest that her activities are a subterfuge of any type.

¶ 26. Furthermore, we do not hold that good motives, by themselves, never directly support a finding of reasonableness. Rather, we simply fail to discern any reason why Dr. Chen's good motives are relevant to the determination of shirking in this case.

Expectation Prior to the Divorce

¶ 27. Dr. Chen argues that her decision is reasonable because the marital settlement agreement contemplated that child support would he ordered if there were a significant change in income. Dr. Chen also argues that Dr. Warner knew, prior to and during the pendency of the divorce, that Dr. Chen was interested in part-time status and that such a change might result in Dr. Warner paying child support. We agree with Dr. Warner that neither of these arguments has merit.

¶ 28. The language in the marital settlement agreement does not assist Dr. Chen. It provides: "The parties' waiver of child support is based upon the parties' present income and, if there is a substantial change in their relative incomes, it is recognized that the child support provisions may be modified within the discretion of the court." This language simply acknowledges that a substantial change in income might, at a party's request, prompt the court to revisit child support. It sheds no light on whether Dr. Chen's voluntary decision to reduce her income was reasonable.

¶ 29. We turn our attention to Dr. Chen's argument that her decision was reasonable because Dr. Warner knew before the divorce that Dr. Chen was interested in part-time work so she could spend more time with the children. Dr. Chen points out that Dr. Warner knew this before he signed off on the marital settlement agreement.

¶ 30. There is indirect support for the proposition that, when a reduction in income is jointly contemplated during marriage, a later decision to reduce income in accordance with such understanding weighs in favor of a reasonableness finding. See Sellers, 201 Wis. 2d at 588 (a parent's decision to reduce income "represented] a diversion neither [parent] anticipated at the time of the marriage"). But that is not the situation here. There is no record of an agreement during the marriage that Dr. Chen would eventually reduce her hours to facilitate more parental involvement. We conclude that Dr. Warner's knowledge that Dr. Chen was interested in reducing her hours does not make Dr. Chen's decision to remain unemployed more reasonable.

Dr. Chen's Employment Opportunities

¶ 31. Dr. Warner asserts that Dr. Chen made "only minimal efforts to obtain part-time employment, when confronted with her declining investment income." Dr. Chen asserts that there were no jobs available that would permit her to continue parenting in the manner she believed was most beneficial to her children. This dispute requires clarification because the parties are, in effect, arguing past each other.

¶ 32. The underlying facts are not in dispute. Since quitting her full-time job, Dr. Chen has continually sought part-time employment in the Marshfield area. However, she declined to pursue part-time jobs that would have taken her completely away from the children every other week. For example, Dr. Chen believed that she could have obtained work as a "temp" doctor every other week in communities such as La Crosse, Green Bay, Milwaukee, or Janesville. But, according to Dr. Chen's undisputed testimony, none of these jobs were within a reasonable commuting distance. Taking any of these jobs would have meant that Dr. Chen would be largely unavailable to her children every other week.

¶ 33. Thus, the question is not whether Dr. Chen failed to vigorously pursue available work. The question is whether Dr. Chen's decision not to pursue available work that would take her away from the children every other week was reasonable.

Dr. Warner's Ability to Pay

¶ 34. We next address Dr. Warner's ability to pay child support. Dr. Warner does not argue that his ability to pay is irrelevant for purposes of determining reasonableness. For that matter, Dr. Warner does not argue that he cannot afford to pay child support. Rather, Dr. Warner argues that Dr. Chen should not be able to engage in the "luxury of reduced employment simply because [Dr. Warner] earns income sufficient to support the family." Dr. Warner states: "If Dr. Chen's decision [not to earn income] appears reasonable at all, it is only because there was another high-income child support obligor waiting in the wings."

¶ 35. Dr. Warner does not argue that his ability to pay child support is an inappropriate consideration for purposes of shirking analysis. Obviously, if one working parent has no ability to pay additional child support, the other parent's voluntary decision to remain unemployed would not likely be reasonable. Conversely, if the other parent can easily afford child support, that factor may weigh in favor of the reasonableness of a parent's decision to remain unemployed. We conclude that ability to pay child support is an appropriate shirking factor, but the weight to be given this factor, if any, will necessarily vary from case to case.

¶ 36. Because Dr. Warner's income is so high, our consideration of this factor is much simplified. Dr. Warner's income and retirement benefit, approximately $545,000 per year, are sufficiently high that he is able to afford any reasonable level of child support without significant detriment to his lifestyle or his ability to provide for himself or his children now or in the future.

¶ 37. At lower income levels, complicated questions may arise as to how to analyze "ability to pay." A divorced parent who voluntarily reduces income does not know whether or in what amount the other parent will be ordered to pay child support. In cases where the incomes involved are neither clearly high enough nor clearly low enough to reach a predictive determination of ability to pay, does the reasonableness prong of shirking analysis intertwine with the amount eventually ordered? Dr. Chen effectively answers that question yes when she stresses that Dr. Warner can easily afford to pay $4,000 per month in child support. We do not address the topic.

¶ 38. We are not persuaded by Dr. Warner's argument that Dr. Chen should not be able to engage in the "luxury of reduced employment simply because the other parent earns income sufficient to support the family." This argument ignores the work involved in the active parenting of three young school-age children. More importantly, Dr. Chen did not quit "simply" because of Dr. Warner's ability to pay. If she had, her decision would not even arguably qualify as reasonable.

¶ 39. We turn to Dr. Warner's "race to resign" argument. For purposes of this argument, Dr. Warner focuses attention on the fact that both he and Dr. Chen were high-income earners at the time Dr. Chen quit her job. Dr. Warner argues that a decision in favor of Dr. Chen would encourage "dual high-income [divorced parents] to engage in a race to retirement or resignation." In Dr. Warner's view, the first-in-time parent to resign wins the race and unilaterally forces the other parent to foot the bill.

¶ 40. Dr. Warner's prediction, however, seemingly assumes that the "winner" maintains substantially the same lifestyle without the burden of employment. However, even with respect to the temporary time period child support is awarded, Dr. Warner presents an unlikely scenario, because a parent who resigns cannot expect payments that amount to disguised maintenance.

¶ 41. Further, Dr. Warner's "race to resign" argument assumes there are substantial numbers of dual high-income divorced parents who want to, and are actually willing to, quit a career to become a full-time parent. Dr.-Warner does not support this speculation. As the facts recited in the background section of this opinion exemplify, a person who drops out of a career for several years to parent typically gives up substantial financial security and prestige. He or she also faces an uncertain return to the workforce. Will a job be available in the same geographic location? Will the parent need to restart his or her career in an entry-level job? Will the decision to parent be viewed later as a lack of commitment by prospective employers? We also note that there is no indication Dr. Warner has any interest in quitting his job. That is, there is no reason to think that, if Dr. Warner had realized he could beat Dr. Chen to the punch by resigning first and seeking child support, he would have done so.

Benefit to the Children

¶ 42. Both parties contend that a proper "shirking" consideration in this case is the benefit the children derive from Dr. Chen's decision to remain unemployed. We agree this is an appropriate factor. See Kelly, 178 Wis. 2d at 558. The parties do, however, dispute whether the benefit to the children is significant enough to make Dr. Chen's decision reasonable. In this section, we set forth the evidence bearing on the benefit to the children.

¶ 43. The record reveals that, prior to the time Dr. Chen quit, Dr. Chen's and Dr. Warner's involvement with the children was fairly typical of dual full-time working parents with high incomes. Both parents attended school and pre-school functions when they could, but not regularly. They hired a nanny to assist with the children. For the most part, one or both parents were available at dinnertime, after dinner, and on weekends. Dr. Warner, who still works full-time, attends parent-teacher conferences, attends some of the children's school activities, and spends as much as three hours a night assisting with homework during the weeks the children are with him. Dr. Warner schedules substantial vacation time with the children.

¶ 44. The physical placement is equal: the children spend every other week with each parent. Dr. Chen's involvement with the children has increased substantially since she quit her job, both during the weeks she has placement and the weeks she does not. Dr. Chen provides volunteer services in each of the children's classrooms and acts as a driver or chaperone for nearly all of their class field trips. Dr. Chen's involvement in these activities has allowed her to develop a close working relationship with each of the children's teachers. This, in turn, gives her the opportunity to deal quickly with areas of concern that might arise. For example, Dr. Chen testified that one daughter is "extremely sensitive and she will burst into tears in school." Dr. Chen explained that she was able to explain to the teachers "what causes it and what to do when it happens and that it's - it's something that has decreased over time." As another example, Dr. Chen testified that she was able to work with teachers on another daughter's "organizational problems."

¶ 45. Dr. Chen has also become very active in the children's non-school activities. These activities include dance, tae kwon do, piano, swimming, and knitting. Dr. Chen takes the children to all of these activities each week and usually stays to see how they are doing and to monitor their participation. Dr. Chen helps the children with piano by helping them with music theory and helping them prepare and practice for recitals and competitions.

¶ 46. Dr. Chen gave an example of an opportunity she thinks would not have been pursued if both she and Dr. Warner still worked full time. One of their daughters was interested in an advanced art program. Dr. Chen met with the daughter's art teacher, decided which pieces of art to submit, had the art matted and framed, and took the daughter to the three-hour screening test.

¶ 47. Dr. Chen testified that her involvement enables her to get to know her daughters' friends and the families of those friends. Dr. Chen testified that she makes arrangements for her daughters to play with friends and she also steers the children away from possible trouble. Dr. Chen gave as an example one daughter who wanted to sleep over at a friend's house. Dr. Chen was familiar with the family and knew that the parents did not supervise their children, that the parents were heavy smokers, and that the home was "extremely dirty." Dr. Chen concluded that the sleepover was not a "safe arrangement." She spoke with her daughter about it and the daughter agreed it would not be a good idea to spend time at that girl's house.

¶ 48. Dr. Chen testified that she had recently spent time looking for a child-friendly church and found one that fit their needs. The girls now attend church services and Sunday school and have recently gone to a "vacation Bible school."

¶ 49. Dr. Warner did not argue below, and does not argue before this court, that Dr. Chen's testimony is inaccurate or that the examples she gives do not constitute benefits to the children. Rather, Dr. Warner argues that the benefits are limited. Dr. Warner relies on his own uncontested testimony that the children were thriving before Dr. Chen quit working. He accurately points out that there is no evidence in the record that any change occurred requiring Dr. Chen to quit work to care for the children. Dr. Warner testified: "I think that the care provided during the day by their long-term nanny combined with our care in the evening when we returned from work was doing a very good job of raising them." Dr. Warner also notes that the children were all school age with no special needs at the time Dr. Chen declined to return to work and instead sought child support.

Application of Factors

¶ 50. In the subsections above, we conclude that neither Dr. Chen's good motives nor Dr. Warner's knowledge that Dr. Chen was considering reducing her hours weighs in favor of finding Dr. Chen's decision to forgo all employment reasonable. We also explain that Dr. Chen, as of the time of the hearing, did not have employment opportunities that would permit her to supervise and assist the children during the weeks they have placement with Dr. Warner. Indeed, the question here is whether it is reasonable for Dr. Chen to forgo part-time work so that she can parent during the weeks she does not have placement. Accordingly, we focus on Dr. Warner's ability to pay and the benefits the children derive from having Dr. Chen available every week.

¶ 51. Dr. Warner's main argument regarding the benefits to the children is that the children were doing well before Dr. Chen quit and they are doing well now. He also states that the benefit of having a full-time parent is substantially less when children are, as here, school age. These arguments have merit but, at the same time, the benefits described by Dr. Chen, though difficult to measure, are significant. It is hard to argue with the proposition that children benefit when parents know who their friends are and actively steer the children away from bad influences. Similarly, even high-performing children may encounter difficulties in school or miss opportunities for enrichment. Thus, a reasonable judge could find that Dr. Chen's efforts benefit the children and that benefit is enhanced by Dr. Chen's ability to supervise and assist every week, not just every other week.

¶ 52. Dr. Warner argues that Dr. Chen, in effect, asks this court to make a general value judgment and adopt a blanket rule elevating stay-at-home parenting over income-earning, regardless of the placement schedule and the other particular facts of the case. We do nothing of the sort. We readily acknowledge that it is difficult to assess the comparative benefits of Dr. Chen working every other week and not working at all. Further, this is not a case in which either party offered expert testimony or statistical evidence of the short- or long-term benefits to school-age children from having an active, involved full-time parent such as Dr. Chen. We hold only that, in this case, a reasonable trial judge could determine that Dr. Chen's decision to forgo part-time work — work that would take her away from the children every other week — was reasonable in light of Dr. Warner's ability to pay child support and the benefits to the children.

By the Court. — Order affirmed.

DYKMAN, J.

0dissenting).

¶ 53 Dr. Chen is a millionaire. Dr. Warner is a millionaire. They were divorced in 1999, and share equally in the placement of their three children, each parent having physical placement of the children during alternating weeks. Until this post-divorce proceeding, neither party paid the other maintenance or child support, and each paid for the children's care when they were with them. Dr. Warner has remarried. The record does not include the income of Dr. Warner's wife. Dr. Chen lives with a significant other, whose income for 2001 was $8,049.

¶ 54. In May of 2000, Dr. Chen retired, at age forty-three. She testified that she did so to stay home with her children. Had she not retired, her 2002 gross income would have been $405,491. She testified that because her securities had decreased in value, she needed more income. She estimated her household budget at $5,000 per month, and wanted Dr. Warner to pay $4,000 of that. Dr. Warner did not submit a budget showing the cost of supporting the children for the half-year they were with him. The trial court granted Dr. Chen's motion and ordered Dr. Warner to pay child support of $4,000 per month.

¶ 55. The majority affirms this result, deferring not to the trial court's determination that Dr. Chen's decision to retire was reasonable, but instead concluding that a reasonable judge could conclude that Dr. Chen's decision not to seek part-time work was reasonable. I question the reasonableness of a decision to retire at age forty-three and depend upon income from securities. Those securities were valued at a time when even poorly informed persons knew that the stock market had reached an all-time high. There is no evidence of the type of securities Dr. Chen held when the stock market declined. But, given Dr. Chen's testimony that she sought the advice of a financial consultant before retiring, I do not take issue with the majority's conclusion that we need not examine Dr. Chen's initial decision to retire. But I disagree with the majority's decision of what to review and the standard of review it uses to review later action (or inaction) of Dr. Chen.

¶ 56. To begin with, this opinion will be published, and therefore become precedent for future reduction of income cases which will almost never involve parents with the net worth, income and income potential of Dr. Chen and Dr. Warner. Though the majority disclaims that use, the reason for publication belies that disclaimer. See Wis. Stat. § 751.42(2) (2001-02) (Stating that officially published opinions of the court of appeals shall have statewide precedential effect.). The use of a "shirking" analysis here really does not matter because both parties could support their children without the other, using their income or their assets. But applying the holding here to cases involving persons of more modest means raises questions of public and social policy that need more analysis than the majority gives.

¶ 57. The result of a case is often driven by the standard of review used. The majority uses a deferential standard, concluding that a reasonable trial judge could reach the result found here. Assuming that the "reasonableness" of Dr. Chen's decisions is the test, "reasonableness" is a question of law. A.Y. v. Ronnie J., 2004 WI App 58, 271 Wis. 2d 242, 677 N.W.2d 684. I recognize the "intertwining" exception to this conclusion, but here there is no intertwining. Instead, what we are really deciding, based on our own knowledge and beliefs, is that children raised by stay-at-home parents become better children, students, citizens and adults. We are deciding that the more money spent on children, the greater benefit to the children, and that the more activities children engage in, the better the child and ultimately the better the adult. We are deciding that a divorced parent can make a unilateral decision to retire that would be a joint decision in most marriages. While I intuitively agree with some of this, if judges are going to make those policy decisions without evidence, I question whether the answer to those decisions should depend upon which circuit judge is making the decision. So, were I writing for a majority, I would not use a deferential standard of review, but review cases of this sort de novo.

¶ 58. I would also review Dr. Chen's decision differently. The majority focuses on Dr. Chen's decision not to actively seek part-time work. That is not my analysis. Though I do not take issue with her decision to retire in 2000, the question for me is whether her decision not to return to full-time work is reasonable. Dr. Chen worked full time until shortly after she divorced. We do not know how either Dr. Warner's wife or Dr. Chen's significant other interact with the children, or what parenting benefits they can or will provide for them. We do not know whether Dr. Chen would obtain full-time work if she sought it.

¶ 59. Nor do I discount Dr. Warner's "race to resign" concern. I do not share the majority's disbelief that this will occur. Of course there are benefits and detriments to any career decision. I believe, however, that some persons who find working outside the home stressful and unrewarding will be willing to trade that lifestyle for what they perceive as a more leisurely lifestyle. Their willingness may be enhanced if they can make a unilateral decision and place the economic burden on another. While the majority disclaims any universality to its holding, the message is that if the income or assets of an ex-spouse are sufficient, retirement at an early age accompanied by evidence of child rearing activities will achieve the expected result. If the non-retiring spouse is wealthy enough to fund the retiring spouse's decision, the desire of the non-retiring spouse not to pay what can be hidden maintenance is not considered.

¶ 60. Ultimately, I conclude that the majority's "shirking" analysis is unsuited for a case such as this one. A better one would be this: The decision to retire at an early age while obligated for child support is disfavored. Nonetheless, courts should accept that decision as long as the retiring parent has sufficient assets or income to meet the expected support obligation. The retiring parent will be required to use income and to liquidate his or her assets before requiring the non-retiring spouse to support the retiring spouse's unilateral decision to retire.

¶ 61. I agree with the majority that "shirking" is an unfortunate term, better suited for cases where a support payer is unemployed or has changed jobs. Yet, the majority has shoehorned this case into a "shirking" analysis. The result is an inquiry into the reasonableness of Dr. Chen's actions without considering Dr. Warner's desire not to be bound by Dr. Chen's unilateral decision, and not to pay for Dr. Chen's retirement. Of course, both Dr. Chen and Dr. Warner are ultimately responsible for their children's support. That overrides either of their economic interests.

¶ 62. Were I writing for a majority, I would remand to permit the trial court to inquire further into Dr. Chen's income and to consider her $1,691,000 estate. The trial court, using the test I have suggested, would consider the nature of Dr. Chen's assets, and when they would probably be exhausted. If Dr. Chen is capable of supporting her decision to retire, the trial court should require her to do so. If and when she is not, Dr. Warner should be prepared to assume his children's economic needs. Because the majority does not reach this conclusion, I respectfully dissent.

       There are discrepancies in the record regarding income amounts at various points in time. None of the differences in the numbers affect our decision.

       We state the test as having two prongs even though some cases suggest there are two variations of shirking: those in which a parent voluntarily fails to earn to his or her full capacity with the purpose of avoiding child support and those in which a parent makes a voluntary and unreasonable decision regarding income. See, e.g., Rottscheit v. Dumler, 2003 WI 62, ¶ 21, 262 Wis. 2d 292, 664 N.W.2d 525; Sellers v. Sellers, 201 Wis. 2d 578, 587, 549 N.W.2d 481 (Ct. App. 1996); Kelly v. Hougham, 178 Wis. 2d 546, 555, 504 N.W.2d 440 (Ct. App. 1993). We clarify that cases involving a voluntary decision motivated by a desire to avoid child support comprise one type of case that fits under the general voluntary and unreasonableness standard. That is, reducing income for the purpose of avoiding child support is one of many possible unreasonable reasons to reduce income. If a circuit court finds that a parent's decision to reduce income is motivated, even in part, to avoid child support, that finding supports the conclusion that the decision is unreasonable. Obviously, if child support avoidance is the only reason, the decision is unreasonable.

       The reader is cautioned that the determination of the income capacity of incarcerated persons for purposes of child support is not amenable to normal shirking analysis. See Rottscheit, 262 Wis. 2d 292, ¶ 38 (shirking analysis is inapplicable when the obligor is incarcerated for crimes unrelated to the avoidance of paying child support because "[i]n such cases, the unreasonable decision is to commit a crime, not to reduce income or avoid child support."); see also Voecks v. Voecks, 171 Wis. 2d 184, 187-88, 491 N.W.2d 107 (Ct. App. 1992).

       Dr. Warner states that the circuit court "seemed to apply" an erroneous standard of law by requiring bad faith or intent to avoid support as a prerequisite to finding shirking. We are not persuaded. Our attention is directed to the following single reference by the circuit court to Dr. Chen's intent: "That the market fell, and fell so badly, does not convert Chen's innocuous, even benevolent decision, into malevolent shirking." We do not interpret this statement as an indication that the circuit court believed it needed to find malevolence in order to find shirking. Rather, the court is observing that malevolent intent does not exist. If it did, such intent would weigh in favor of shirking.

       It may be that taking work on a "temp" basis would carry with it additional complications and expenses that might weigh in favor of Dr. Chen's decision. However, Dr. Chen has not detailed such complications in either her testimony or her argument. Since Dr. Chen has the burden of demonstrating that her decision is reasonable, we decline to consider anything more than the fact that such work would take Dr. Chen away from the children every other week.

       The dissent worries that too much will be read into the majority opinion; that this case will be read as generally holding that a spouse may quit working whenever the other spouse is able to pick up the financial slack. That is not the holding of this case. This decision is publishable, not because it sets forth a general rule regarding the result that should be reached in this type of case, but because it clarifies the analysis that should be used. We very clearly state that the result in this case is a reasonable one, not the only reasonable one.
      We will not take the time to dispute all of the assertions in the dissenting opinion, but one additional passage is hard to ignore. The dissent states: "We are deciding that the more money spent on children, the greater benefit to the children, and that the more activities children engage in, the better the child and ultimately the better the adult." The majority opinion does nothing of the sort. Nothing in this opinion suggests that more money produces better children. Indeed, Dr. Chen's decision not to return to work reduces the amount of money available for the children now and in the future. Also, there is no suggestion that more activities result in better children. The children in this case would have been involved in their many activities, regardless of Dr. Chen's work schedule.

       At the time of her divorce, Dr. Chen's November 1999 financial disclosure statement showed a net worth of $1,712,408. Her April 2002 financial disclosure statement showed a net worth of $1,691,000, a loss of $21,408 since 1999. There was no testimony as to the effect on value caused by some of the assets being held in pre-tax accounts.

       At the time of his divorce, Dr. Warner's November 1999 financial statement showed his net worth as $1,712,408, the same as Dr. Chen's. His March 2002 financial disclosure statement shows that he owns an automobile valued at $23,225, checking and savings accounts valued at $132,444 and real estate with equity of $408,200. Originally appended to his 2002 financial disclosure statement were attachments A through D, which listed the value of his tangible personal property, securities and two retirement accounts. The attachments are no longer appended to the financial disclosure statement. I conclude, however, that with a net worth of $1,712,408 in 1999 and income which increased from $230,000 in 1999 to $545,000 in 2002, Dr. Warner's 2002 net worth exceeds a million dollars. There was no testimony as to the effect on value caused by assets held in pre-tax accounts.

       Faced with arguably similar facts, a trial court judge in Missouri imputed income to an unemployed custodial parent who had left lucrative employment as a physician, giving as a primary reason her desire to be home with her children. The Missouri Court of Appeals affirmed. Stanton v. Abbey, 874 S.W.2d 493, 500 (Mo. Ct. App. 1994).

       I do not suggest a de-novo standard if voluntariness is a part of a "shirking" analysis. Whether an action is voluntary in cases of this sort involves credibility and choosing between disputed facts. A deferential review acknowledges these factors.

       The supreme court concluded that a "shirking" analysis was inapplicable to a request for support modification where the requester was incarcerated resulting from a criminal conviction. See Rottscheit v. Dumler, 2003 WI 62, 262 Wis. 2d 292, 664 N.W.2d 525.


source: Caselaw Access Project

author: VERGERONT, J.

license: Public Domain

text:
    State of Wisconsin, Plaintiff-Respondent, v. Jason C. Miller, Defendant-Appellant.

    Court of Appeals

      No. 03-1747-CR.

      Submitted on briefs February 11, 2004.

      Decided May 6, 2004.

    2004 WI App 117
    (Also reported in 683 N.W.2d 485.)

      On behalf of the defendant-appellant, the cause was submitted on the briefs of Robert T. Ruth, Ruth Law Office, Madison.
    On behalf of the plaintiff-respondent, the cause was submitted on the brief of James M. Freimuth, assistant attorney general, and Peggy A. Lautenschlager, attorney general.
    Before Deininger, PJ., Dykman and Vergeront, JJ.

       Petition to review denied 8-2-04.

   VERGERONT, J.

¶ 1. Jason Miller appeals a judgment of conviction for operating a motor vehicle while under the influence of an intoxicant (OWI), fifth offense, contrary to Wis. Stat. § 346.63(l)(a) (2001-02). The charge resulting in this conviction was refiled after the trial court dismissed the charge without prejudice at the prosecutor's request, following the court's decision to exclude certain State's evidence as a sanction for a violation of the discovery statute, Wis. Stat. § 971.23. Miller contends the trial court in the second action erred in denying his motion to exclude the same evidence because of the decision in the first action to exclude it. We conclude that exclusion in the second action is not required by § 971.23, by the equal protection clause, or by any of the preclusion and estoppel doctrines on which Miller relies. We therefore affirm.

BACKGROUND

¶ 2. The facts relevant to this appeal are not disputed. On June 5, 2000, the State charged Miller with OWI, fifth offense, for an incident that occurred on June 3. The State later added a charge for a violation of Wis. Stat. § 346.63(l)(b), operating with a prohibited alcohol concentration, based on the same incident. In early September 2000, Miller filed a discovery demand for all reports of expert witnesses or, if none existed, a written summary of the expert's findings. The State did not provide any reports or summaries in response to the request until February 23, 2001, the Friday before the Monday jury selection; on that date it provided Miller's counsel with a summary of the State's expert's testimony on blood alcohol concentration (BAC), which it intended to introduce at trial.

¶ 3. Miller filed a motion asserting that the State had not provided the summary within a reasonable time before trial as required by Wis. Stat. § 971.23(l)(e). Miller asked the court to exclude the testimony under § 971.23(7m)(a), which provides:

The court shall exclude any ... evidence not presented for inspection or copying required by this section, unless good cause is shown for failure to comply. The court may in appropriate cases grant the opposing party a recess or a continuance.

¶ 4. The trial court, the Honorable Moria Krueger presiding, determined that the State had failed to turn over the summary of its expert's testimony within a reasonable time before trial. The State then asked for a continuance, to which Miller objected. Judge Krueger concluded that, unless Miller sought or agreed to a continuance, the court was required by Wis. Stat. § 971.23(1) and (7m)(a) to exclude the evidence. Judge Krueger therefore ruled that the expert's testimony was excluded and denied the State's motion to stay that ruling pending appeal.

¶ 5. When the hearing resumed after a recess, the prosecutor moved to dismiss the charges, stating that he was "not sure [he had] the appropriate charge here at this time and because [he] need[ed] to assess what the status of [the] case [was] based upon [the court's] ruling." Miller opposed the motion. Judge Krueger concluded the trial court did not have the authority to deny a prosecutor's motion to dismiss charges because he or she was not prepared to proceed, nor did it have the authority to dismiss with prejudice. Judge Krueger also expressed the opinion that dismissal was appropriate because the State should have the opportunity to prosecute the charges if the defense has timely notice of the summary of the expert's testimony. Judge Krueger therefore granted the motion and dismissed the charges without prejudice.

¶ 6. The State reissued the two charges in a complaint filed in May 2001. The case was assigned to a different judge, the Honorable David Flanagan. Miller moved to "enforce" Judge Krueger's order excluding the State's expert's BAC testimony on the grounds of equal protection, issue preclusion, claim preclusion, and es-toppel by record. Judge Flanagan denied the motion in a written decision. He first observed that Judge Krue-ger had had no expectation that the exclusion ruling would control after a refiling but in fact recognized that the charges could be refiled and the expert's testimony might then be admissible. Judge Flanagan concluded that neither issue preclusion nor claim preclusion applied, reasoning that the issues Judge Krueger ruled on — the timeliness of providing the summary and whether there was good cause for not doing so earlier —were not issues in this case.

¶ 7. Miller was convicted on both charges after a jury trial at which the State's expert testified.

DISCUSSION

¶ 8. On appeal, Miller challenges Judge Flanagan's decision denying his motion to exclude the State's expert's BAC testimony because of Judge Krueger's order. He renews the grounds in that motion, and also asserts that the legislature's intent in enacting Wxs. Stat. § 971.23(1) and (7m)(a) and judicial estoppel require Judge Flanagan to exclude the testimony.

1. Statutory Analysis

¶ 9. Miller argues that the prosecutor's conduct and the rulings of the two trial judges impermissibly "circumvent" Wis. Stat. § 971.23(7m)(a). The premise of this argument is that the purpose of the statute is not only to exclude evidence not provided in compliance with § 971.23(1) (e) unless there is good cause, but also to prevent the State from introducing that evidence if it seeks dismissal and then refiles the charges, as it did here. This argument requires that we construe § 971.23(1) and (7m)(a) and thus presents a question of law, which we review de novo. State v. Setagord, 211 Wis. 2d 397, 405-06, 565 N.W.2d 506 (1997). We begin with the language of the statute and if that is unambiguous, we apply the language to the facts at hand. Id. at 406.

¶ 10. The first sentence of Wis. Stat. § 971.23(7m)(a) plainly requires the court to exclude evidence not presented as required by the section if good cause is not shown. See State v. DeLao, 2002 Wl 49, ¶ 51, 252 Wis. 2d 289, 643 N.W.2d 480. If good cause is shown, the court may exclude the evidence but it is not required to do so; it may instead grant the opposing party a recess or continuance, as provided in the second sentence. Id. (citing State v. Wild, 146 Wis. 2d 18, 429 N.W.2d 105 (Ct. App. 1988)). There is nothing in the paragraph to suggest that the legislature intended to prevent the offending party from introducing the same evidence in a subsequent proceeding if there was no violation in that proceeding of the party's obligations under § 971.23. Similarly, there is nothing in this paragraph to suggest that the State may not obtain a dismissal of charges after evidence is excluded under this paragraph and then refile the charges.

¶ 11. We therefore reject Miller's argument that the State acted contrary to the statute by asking for a dismissal after Judge Krueger excluded the State's expert's testimony and then refiling charges. Wisconsin Stat. § 971.23(7m)(a) prevents a situation in which one party has to proceed to trial without adequate time to prepare in response to the other party's required disclosures, and that situation was prevented here by Judge Krueger's ruling. Miller is evidently of the view that the sanction of exclusion of evidence when the State has the option of dismissing and refiling the same charges is not strong enough, but he is arguing for a sanction that the plain language of the statute does not address. For the same reasons, neither Judge Krueger's order granting the motion to dismiss nor Judge Flanagan's refusal to exclude the evidence when the charges were refiled are contrary to or prohibited by § 971.23(7m)(a).

2. Equal Protection

¶ 12. Miller argues that, if we construe Wis. Stat. § 971.23(7m)(a) as we have done, there is a violation of his right to equal protection. This presents a question of law, which we review de novo. Tomczak v. Bailey, 218 Wis. 2d 245, 260, 578 N.W.2d 166 (1998).

¶ 13. A statute violates the equal protection clause of the Fourteenth Amendment to the United States Constitution and article I, section 1 of the Wisconsin Constitution when it unconstitutionally treats members of similarly situated classes differently. See id. at 261. We presume a statute is constitutional and indulge every presumption favoring validity of the law. Id. If a legislative classification interferes with a fundamental right or disadvantages a suspect class, we apply strict scrutiny; otherwise, we apply a highly deferential standard and uphold the statute if there is any rational relationship to a legitimate government objective. Id. at 261-62, 264.

¶ 14. Miller asserts that dismissal and refiling of the charges interferes with his fundamental right to due process and a speedy trial. However, he does not develop this argument sufficiently. He does not even refer to the case law on these constitutional rights and does not explain why dismissal of the charges and refiling violated those constitutional rights, nor does he relate the delay occasioned by dismissal to the issue of what evidence the State is permitted to introduce in the second case. We therefore apply the "rational basis" test.

¶ 15. Miller argues that, although both the State and defendants have obligations to provide discovery and both are subject to the sanctions in Wxs. Stat. § 971.23(7m) for not doing so, only the State has the option of dismissing the case and refiling it, thus avoiding the sanction. However, this difference is not the result of any classification made by the legislature in this statute. Both the State and defendants are subject to the sanctions and remedies of § 971.23(7m) if they do not meet their statutory obligations, and, under our construction of this paragraph, neither a defendant nor the State is precluded in a subsequent case from using evidence previously excluded under § 971.23(7m) if the statutory disclosure requirements are met in the later case.

¶ 16. The difference Miller points to is not created by this statute but arises from the fundamentally different roles of the prosecutor, who files the charges, and the defendant, who defends against them. The trial court has the discretion to order a dismissal without prejudice at the prosecutor's request if it is in the public interest to do so, State v. Kenyon, 85 Wis. 2d 36, 45-47, 270 N.W.2d 160 (1978), and if the request is made before the jury is sworn, State v. Seefeldt, 2003 WI 47, ¶¶ 15-19, 261 Wis. 2d 383, 661 N.W.2d 822. Apparently Miller's position is that, unless the statute is read to prevent the State from obtaining a dismissal without prejudice, refiling the charges, and using the excluded evidence in the new case, the statute has a different impact on defendants than it does on the State, and this difference in impact violates the equal protection clause.

¶ 17. Assuming without deciding that the difference in impact of a statute that itself creates no classification is within the scope of the equal protection clause, we nonetheless conclude Wis. Stat. § 971.23(7m)(a) as we have construed it does not violate the equal protection clause. The government has a legitimate interest in the prosecution of criminal charges, consistent with the constitutional rights afforded a criminal defendant. Allowing the State the opportunity to dismiss and refile charges when evidence has been excluded under § 971.23(7m)(a) but might not be excluded in a new action furthers that interest in a rational way, even though the defendant does not have the same option. The defendant, like the State, has the protections in § 971.23(7m) against untimely disclosures; the defendant also has the constitutional protections of due process, speedy trial, and double jeopardy prohibition to circumscribe the State's use of its authority to decide when to file charges, when to dismiss, and when to refile.

3. Issue Preclusion

¶ 18. Miller argues that the doctrine of issue preclusion bars the State from introducing its expert's BAC testimony because the issue of whether that should he admitted was litigated and decided by Judge Krueger.

¶ 19. Issue preclusion, formerly known as collateral estoppel, limits the relitigation of issues that have been actually decided in a previous case. Paige K.B. v. Steven G.B., 226 Wis. 2d 210, 219, 594 N.W.2d 370 (1999). The burden is on the party asserting issue preclusion to establish that it should be applied. Id. An issue on which relitigation may be foreclosed may be one of evidentiary fact, of "ultimate fact," or of law. Manu-Tronics, Inc. v. Effective Mgmt. Sys., Inc., 163 Wis. 2d 304, 316 n.8, 471 N.W.2d 263 (Ct. App. 1991). If the issue in both actions is the same and has actually been litigated, and the party against whom preclusion is asserted was a party, in privity with a party, or had sufficient identity of interest with a party in the previous litigation, then the trial court is to apply various factors to decide if the application of the doctrine is fundamentally fair. Paige K.B., 226 Wis. 2d at 224-25; Masko v. City of Madison, 2003 WI App 124, ¶¶ 5-6, 265 Wis. 2d 442, 665 N.W.2d 391.

¶ 20. A threshold question in this case is whether there is an identity of issues. This requires a comparison of the issue or issues decided by Judge Krueger and the issue or issues that Miller seeks to preclude litigation on in this case. "[I]t is not the similarity between the types of litigation or actions involved but between the factual [and legal] issues and their roles in the respective actions that is important to whether [issue preclusion] will apply." Hlavinka v. Blunt, Ellis & Loewi, Inc., 174 Wis. 2d 381, 400, 497 N.W.2d 756 (Ct. App. 1993) (citation omitted). We review the question of the identity of issues as a question of law because it involves the application of a legal standard to undisputed facts. See Paige K.B., 226 Wis. 2d at 224.

¶ 21. The issues Judge Krueger decided with respect to the State's expert's BAC testimony were these: (1) Did the State provide a summary of the expert's testimony within a reasonable time prior to trial? (2) If not, did the State have good cause for not doing so? (3) If the answer to the first two questions is no, did Wis. Stat. § 971.23(7m)(a) allow the court any option other than excluding the expert witnesses' testimony? The third issue is purely one of law; the first two involve applying the statutory standards to the facts, which were not disputed and concerned the date of the demand, the date and substance of the State's response, the date of the trial, and the State's reasons for not providing the report sooner.

¶ 22. In the second action, the facts were different in that Miller already had a copy of the expert's summary. Thus, the first two issues decided by Judge Krueger were not before Judge Flanagan for decision. The issue that Miller raised in his motion did ask Judge Flanagan to decide whether Wis. Stat. § 971.23(7m)(a) required that the expert's testimony be excluded in this action, but that was not the same as the third issue decided by Judge Krueger. Judge Krueger decided that § 971.23(7m)(a) required exclusion of the State's expert testimony in the trial then scheduled because the State had not provided a summary within a reasonable time before that trial and did not have good cause. The issue before Judge Flanagan regarding that testimony was whether § 971.23(7m)(a) or some other authority required that the testimony be excluded even though Miller had a summary of the expert's testimony well in advance of the trial in the second case.

¶ 23. Miller argues that the factual context of the issue or issues presented to Judge Krueger and to Judge Flanagan are different only because the State "manipulated" the facts by seeking dismissal and then refiling the charges, and we should therefore disregard the differences. However, the doctrine of issue preclusion is not concerned with why the facts are different in the second litigation and, thus, why there is a different issue of law presented. Rather, the doctrine is aimed at limiting litigation of an issue that has actually been litigated. We are satisfied that, by taking the position that its expert's BAC testimony is admissible in this action, the State is not seeking to relitigate an issue of law or fact decided by Judge Krueger.

4. Claim Preclusion

¶ 24. Miller contends the doctrine of claim preclusion requires that the State's expert's BAC testimony be excluded in this action because, once the State chose not to appeal Judge Krueger's ruling and instead sought a dismissal, that ruling was final.

¶ 25. The doctrine of claim preclusion, formerly called res judicata, bars claims that were or could have been litigated in a prior proceeding when these requirements are met: (1) an identity between the parties or their privies in the prior and present actions; (2) an identity between the causes of action in the two suits; and (3) a final judgment on the merits in a court of competent jurisdiction. Northern States Power Co. v. Bugher, 189 Wis. 2d 541, 551, 525 N.W.2d 723 (1995); De Pratt v. West Bend Mut. Ins. Co., 113 Wis. 2d 306, 310, 334 N.W.2d 883 (1983). Whether claim preclusion applies presents a question of law, which we review de novo. Northern States Power Co., 189 Wis. 2d at 551.

¶ 26. We conclude that claim preclusion is not applicable for two independent reasons. First, as is evident from the name of this doctrine, its application bars a claim, or cause of action, but Miller does not seek that result. The claims in this case are the charges that Miller violated Wis. Stat. § 346.63(l)(a) and (b) in the incident occurring on June 3, 2000. However, Miller is not arguing that the State is barred from refiling those charges. Rather, Miller is arguing that in the second action on the same charges, which he implicitly concedes the State was not precluded from filing, the State may not present certain evidence because the admissibility of that evidence was determined in the first action. This is not the remedy that the application of claim preclusion affords.

¶ 27. The second reason claim preclusion is inapplicable is that there was no "final judgment on the merits." Judge Krueger's order excluding the BAC testimony did not in any sense decide the merits of the charges against Miller. The order dismissing the charges also was not a "final judgment on the merits" because it was without prejudice, meaning that no decision on the merits had been made and the State was therefore free to refile the same charges to obtain a judgment on their merits. See Russell v. Johnson, 14 Wis. 2d 406, 411-12, 111 N.W.2d 193 (1961) (holding, in a civil action for damages, that a dismissal without prejudice does not constitute a judgment because it is not the final determination of the rights of the parties in the actions).

¶ 28. Itistruethatafinaljudgmentonthemerits need not be the result of a full litigation of the claims in order for claim preclusion to apply. For example, a stipulation may meet the requirement of a "final judgment on the merits," Great Lakes Trucking Co. v. Black, 165 Wis. 2d 162, 168-69, 477 N.W.2d 65 (Ct. App. 1991), as may a default judgment. See A.B.C.G. Enterprises v. First Bank Southeast, 184 Wis. 2d 465, 481, 515 N.W.2d 904 (1994). However, the common element is that the judgment ends the litigation on the merits of the claim or claims. Neither Judge Krueger's ruling excluding the evidence nor her order dismissing the charges without prejudice did that.

¶ 29. Miller recognizes that no Wisconsin case has applied claim preclusion in a situation such as this, but he asks us to follow an Oregon case, State v. Swain, 517 P.2d 684 (Or. 1974). In that case the state did not appeal from an order suppressing evidence, which the state statute permitted, but instead elected to have the action dismissed after the preliminary hearing. Id. at 685-86. The Oregon court, without analysis of the requirements of claim preclusion, simply stated that because the state could have appealed the order, it "had to be a final determination and res judicata." Id. at 686. We do not find this decision persuasive. There is no reference to or analysis of the requirements of claim preclusion, and no explanation or logic supporting the bald conclusion that the appealability of an order makes it a final judgment on the merits for purposes of claim preclusion. Indeed, it appears the court was talking about issue preclusion, because it did not bar the action on the same charges but rather the admission of evidence previously excluded. However, if we read the decision in this way, it does not support Miller's position — while the issue of the admissibility of evidence in the first Oregon case may have been the same as in the second case, we have already held that is not true here.

5. Estoppel by Record

¶ 30. Estoppel by record is a doctrine similar to claim preclusion under which a party is prevented from litigating what was litigated or might have been litigated in another proceeding, but it is the record of the prior proceeding, not the judgment, that is the bar to the second proceeding. Brooks v. Bank of Wisconsin Dells, 161 Wis. 2d 39, 46, 467 N.W.2d 187 (Ct. App. 1991). Estoppel by record does not apply for the first reason that claim preclusion did not: Miller is not asserting that the State is barred from refiling and litigating the charges against him; instead he asserts the State is barred from introducing the evidence Judge Krueger ruled was excluded in the prior action.

6. Judicial Estoppel

¶ 31. Judicial estoppel is a doctrine that is aimed at preventing a party from manipulating the judiciary as an institution by asserting a position in a legal proceeding and then taking an inconsistent position. Salveson v. Douglas County, 2001 WI 100, ¶ 37, 245 Wis. 2d 497, 630 N.W.2d 182. The doctrine requires a showing that: (1) a party against whom estoppel is sought presents a later position that is "clearly inconsistent" with the earlier position; (2) the facts at issue are the same in both cases; and (3) the party to be estopped convinced the first court to adopt its position. Id., ¶ 38. Whether these elements are met is a question of law, which this court reviews de novo; whether to apply the doctrine if the elements are met is a matter for the trial court's discretion. Id.

¶ 32. Miller contends that the elements of judicial estoppel are met here because when the prosecutor asked Judge Krueger for a dismissal he gave as a reason that he was not sure he had the appropriate charges before the court at that time and needed to assess the status of the case based on the court's ruling. This position, according to Miller, is an implicit concession that the expert's BAC testimony would be excluded in a second action, and Judge Krueger in effect "adopted" this implicit concession when she granted the motion to dismiss without prejudice. The State's implicit position, Miller continues, is inconsistent with refiling the same charges and seeking to present the excluded testimony in the new action. Miller asserts that this is what the prosecutor intended to do all along, and he therefore misled Judge Krueger.

¶ 33. We view it as unnecessary to decide what the prosecutor meant by his quoted statement because the third element for judicial estoppel is not met. The record is clear that Judge Krueger was of the view that Wis. Stat. § 971.23(7m) would not bar use of the State's expert's BAC testimony in a new action. Thus, even if the prosecutor somehow implicitly conveyed that he believed the testimony would not be admissible in a new action because of that statute, Judge Krueger did not adopt that position.

CONCLUSION

¶ 34. Underlying all of Miller's arguments is the theme that it is unfair for the State to be able to use the excluded testimony by obtaining a dismissal without prejudice and then refiling the charges. However, that result is not precluded by Wis. Stat. § 971.23, the equal protection clause, or the preclusion and estoppel doctrines that Miller invokes. Judge Flanagan therefore correctly denied Miller's motion to exclude the State's expert's BAC testimony.

By the Court. — Judgment affirmed.

       All further references to the Wisconsin Statutes are to the 2001-02 version unless otherwise noted.

       While statutes relevant to this appeal have been amended since the original charges were filed against Miller, these changes are minor and do not affect our analysis. Accordingly, we cite to and provide excerpts from the 2001-02 version of the statutes.

       WISCONSIN Stat. § 971.23 provides in part:
      (1) What a district attorney most disclose to a dependant. Upon demand, the district attorney shall, within a reasonable time before trial, disclose to the defendant or his or her attorney and permit the defendant or his or her attorney to inspect and copy or photograph all of the following materials and information, if it is within the possession, custody or control of the state:
      (e) Any relevant written or recorded statements of a witness named on a list under par. (d), including any videotaped oral statement of a child under s. 908.08, any reports or statements of experts made in connection with the case or, if an expert does not prepare a report or statement, a written summary of the expert's findings or the subject matter of his or her testimony, and the results of any physical or mental examination, scientific test, experiment or comparison that the district attorney intends to offer in evidence at trial.

       WISCONSIN Stat. § 971.23(7m)(b), which is not at issue in this case, provides:
      In addition to or in lieu of any sanction specified in par. (a), a court may, subject to sub. (3), advise the jury of any failure or refusal to disclose material or information required to he disclosed under sub. (1) or (2m), or of any untimely disclosure of material or information required to be disclosed under sub. (1) or (2m).

       These arguments that we characterize as "added" are closely connected to the arguments that Miller made in the trial court and may plausibly be considered to have been made in the trial court, although they were not separately identified. We therefore address them.

       Wisconsin Stat. § 971.23(1) addresses the State's obligations to disclose and § 971.23(2m) addresses the defendant's obligations to disclose.

       Due process protection applies to pre-charging delays, State v. Wilson, 149 Wis. 2d 878, 904, 440 N.W.2d 534 (1989); the right to a speedy trial commences when the defendant is officially accused of the charges, State v. Borhegyi, 222 Wis. 2d 506, 511, 588 N.W.2d 89 (Ct. App. 1998); and the double jeopardy clause limits the State's ability to request that a trial be terminated and restarted after the jury has been sworn. State v. Seefeldt, 2003 WI 47, ¶¶ 15-19, 261 Wis. 2d 383, 661 N.W.2d 822.

       The State argues that there are other threshold requirements before consideration of the fairness factors: that the issue has been determined by a "valid and final judgment" and that determination of the issue is essential to the judgment, citing Restatement (Second) of Judgments § 27 (1982) and State v. Wille, 185 Wis. 2d 673, 680, 518 N.W.2d 325 (Ct. App. 1994). According to the State, these requirements are not met in this case. Because we decide that issue preclusion does not apply for another reason, we do not discuss these arguments.

       We observe that the factual differences, and hence the different legal issues presented in the first and second actions here, distinguish this situation from one in which a motion to suppress evidence based on a legal standard applied to historical facts is decided in a prior action and in the later action a party seeks a ruling on suppression of the same evidence based on the same historical facts and same legal standard. See, e.g., Jones v. State, 47 Wis. 2d 642, 655-57, 178 N.W.2d 42 (1970). Our decision does not address issue preclusion in such a situation.

       One of the factors courts are to consider in deciding whether to apply issue preclusion, if the threshold requirements are met, is whether the party against whom issue preclusion is asserted could have obtained review of the judgment. Michelle T. v. Crozier, 173 Wis. 2d 681, 689, 495 N.W.2d 327 (1993). Thus, the question whether the State could have appealed Judge Krueger's order excluding the BAC testimony under Wis. Stat. § 974.05(l)(d)2 (providing that the State may appeal as of right certain orders and judgments relating to the suppression of evidence) would become relevant if the threshold requirements had been met.

       Estoppel by record has been employed when the prior proceeding was before an administrative agency. See, e.g., Acharya v. AFSCME, 146 Wis. 2d 693, 696, 432 N.W.2d 140 (Ct. App. 1988). Presumably it has been used in such instances because there was no prior final judgment on the merits from a court of competent jurisdiction, and hence claim preclusion was not available. Miller apparently assumes that estoppel by record is available when the prior proceeding was in court and the third requirement for claim preclusion cannot be met for other reasons. We do not decide whether this assumption is correct.


author: FINE, J.

text:
    In re the Termination of Parental Rights to Chezron M., a Person Under the Age of 18: State of Wisconsin, Petitioner-Respondent, v. James P., Respondent-Appellant.

    Court of Appeals

      No. 04-0723.

      Submitted on briefs March 30, 2004.

    Decided May 11, 2004.

    2004 WI App 124
    (Also reported in 684 N.W.2d 164.)

      On behalf of the respondent-appellant, the cause was submitted on the briefs of Carl W. Chesshir, Milwaukee.
    On behalf of the petitioner-respondent, the cause was submitted on the brief of E. Michael McCann, district attorney and Thomas C. Binger, assistant district attorney, Milwaukee.
    On behalf of the minor child, there was a brief filed by Shelia Hill-Roberts, guardian ad litem, Legal Aid Society of Milwaukee, Inc., Milwaukee.
    Before Wedemeyer, PJ., Fine and Curley, JJ.

       Petition to review granted 10-5-04.

   FINE, J.

¶ 1. James P appeals from an order terminating his parental rights to Chezron M., a girl born in 1995. The trial court determined in a bench trial that James E had abandoned Chezron by having no contact with her between April 25, 2000, and December 25, 2000, and between April 25, 2001, and December 25, 2001, and that there were thus grounds under Wis. Stat. § 48.415(l)(a)3 to terminate his parental rights to her. James E did not dispute before the trial court, and does not dispute on this appeal, that he had no contact with Chezron during those periods. Nor does he assert that he had "good cause" under § 48.415(l)(c) for not having the requisite contact. Rather, he contends that the statute did not apply to him because he was not adjudicated as Chezron's "parent" until 2002. We disagree.

¶ 2. This case is governed by two provisions of the Children's Code, Wis. Stat. §§ 48.02(13) and 48.415(l)(a)3. For the purposes of this appeal, there are no contested facts. Application of a statute to uncontested facts is a legal issue subject to our de novo review. Randy A.J. v. Norma I.J., 2004 WI 41, ¶ 12, 270 Wis. 2d 384, 393, 677 N.W.2d 630, 635.

¶ 3. Wisconsin Stat. § 48.415(l)(a)3 provides that among the grounds "for the termination of parental rights" is that "[t]he child has been left by the parent with any person, the parent knows or could discover the whereabouts of the child and the parent has failed to visit or communicate with the child for a period of 6 months or longer." James E contends that although, as found by the trial court in its extensive and well-reasoned written decision, "[i]n early 2002, as a result of DNA testing, James E was adjudicated the father of Chezron," he was not Chezron's "parent" as that term is used in § 48.415(1)(a)3 when he "failed to visit or communicate with" her. Thus, as noted, he argues that § 48.415(l)(a)3 does not apply.

¶ 4. As material here, Wis. Stat. § 48.02(13) defines "parent" for the purposes of Wis. Stat. ch. 48 as:

either a biological parent, a husband who has consented to the artificial insemination of his wife under s. 891.40, or a parent by adoption. If the child is a nonmarital child who is not adopted or whose parents do not subsequently intermarry under s. 767.60, "parent" includes a person acknowledged under s. 767.62 (1) or a substantially similar law of another state or adjudicated to be the biological father.

Thus, a "parent" is either:

• "a biological parent" or
• "a husband who has consented to the artificial insemination of his wife" or
• "a parent by adoption" or
• "a person acknowledged under s. 767.62 (1) or a substantially similar law of another state" "[i]f the child is a nonmarital child who is not adopted or whose parents do not subsequently intermarry under s. 767.60" or
• a person "adjudicated to be the biological father" "[i]f the child is a nonmarital child who is not adopted or whose parents do not subsequently intermarry under s. 767.60."

As the trial court noted with clarity of insight:

The simplest answer is perhaps the most accurate answer here: a man adjudicated as the biological father has always been the biological father and, therefore, that man has always been a "parent" under § 48.02(13). As such, it is of no import that James E was unadjudicated during the abandonment period — the statute still applies and the State can terminate his rights under § 48.415(1) (a)3.

(Emphasis by the trial court.) We agree that the fact of biological parenthood does not turn on whether it is recognized, found, or adjudicated, any more than the fact that a tree has fallen in the forest depends on someone's perception of the crashing sound, or, in another context, gravity's existence depended on Sir Isaac Newton's formulation of its principles.

¶ 5. No one suggests that any of the middle three bulleted definitions apply. Although the parties discuss the application vel non of the fifth bulleted definition, we need not in this case decide whether an adjudication subsequent to acts that comprise grounds for the termination of a person's parental rights subjects the adjudicated person to the termination of parental rights based on those acts because the first bulleted definition does apply and, as the trial court recognized, James E was always Chezron's biological father, even before he was formally adjudicated as such.

¶ 6. We must, absent a constitutional infirmity, apply statutes as they are written, discerning legislative intent from a statute's language. Wisconsin Citizens Concerned for Cranes and Doves v. Wisconsin Dep't of Natural Res., 2004 WI 40, ¶ 6, 270 Wis. 2d 318, 329, 677 N.W.2d 612, 617. When that language is not ambiguous, we apply it as it stands unless that would lead to an "absurd result." Ibid. Although the law can terminate a parent-child relationship, and it can also foster a psychological parent-child relationship, only a power much much higher than law, lawyers, judges, states or nations can, as the State points out, create biological parenthood. That the fifth bulleted definition (that is, that a person who is "adjudicated to be the biological father" of "a nonmarital child. . . whose parents do not subsequently intermarry") may be within the first bulleted definition ("biological parent") does not narrow the broad scope of that first bulleted definition, which is not, in haec verba, limited to children of a solemnized marriage. See Wisconsin Citizens Concerned for Cranes and Doves, 2004 WI 40, ¶¶ 19-24, 270 Wis. 2d at 338-342, 677 N.W.2d at 622-624 (mourning doves are "game," defined as "wild .. . birds," even though they are not "game birds" and are within the category of "non-game species"); cf. F.M. Mgmt. Co. Ltd. P'ship v. Wisconsin Dep't of Revenue, 2004 WI App 19, ¶ 12, 269 Wis. 2d 526, 537-538, 674 N.W.2d 922, 928 (legislature presumed to use words according to their ordinary, common-sense meaning). Although James E interposes law-school-question-type analyses in an attempt to eschew legal responsibility for the periods during which he had no contact with Chezron, he was in fact Chezron's biological parent when she was born and he has never denied that. We affirm.

By the Court. — Order affirmed.


author: ANDERSON, PJ.

text:
    David Beilfuss, Plaintiff-Appellant, v. Huffy Corporation, Defendant-Respondent.
    Court of Appeals

      No. 03-2006.

      Submitted on briefs February 23, 2004.

    Decided May 12, 2004.

    2004 WI App 118
    (Also reported in 685 N.W.2d 373.)

      On behalf of the plaintiff-appellant, the cause was submitted on the briefs of Mark G. Blum and Lori J. Fabian of Hippenmeyer, Reilly, Moodie & Blum, S.C., Waukesha.
    On behalf of the defendant-respondent, the cause was submitted on the brief of Lawrence T. Lynch and Michael B Kohler of Foley & Lardner, Milwaukee.
    Before Anderson, PJ., Brown and Nettesheim, JJ.
   ANDERSON, PJ.

¶ 1. Strong public policy considerations underpin Wisconsin's law controlling covenants not to compete and lead to the conclusion that the choice of law clause in an employment contract between David Beilfuss and Huffy Corporation is invalid. Because the validity of a choice of law clause is a prerequisite to the validity of a choice of forum clause, it is unreasonable to enforce the provision in the contract selecting Ohio as the exclusive forum for the resolution of any disputes between the parties. Therefore, we reverse the circuit court, which found the provisions on choice of forum and law to be enforceable and remand to the circuit court for resolution of the enforceability of the covenant not to compete under Wisconsin law.

Background

¶ 2. In October 2000, Beilfuss, a Wisconsin resident, was hired as national sales manager, fixture & display assembly for Huffy, an Ohio Corporation. Before starting work with Huffy, Beilfuss signed a "Huffy Corporation Salaried Employment Agreement" that included restrictive covenants governing confidential information and noncompetition. Beilfuss worked for Huffy until May 2002, when he was hired by National Marketing Services (NMS) as vice-president, sales new customer development. In February 2003, Huffy notified NMS and Beilfuss that Beilfuss was in violation of his Employment Agreement with Huffy.

¶ 3. In response, Beilfuss filed a declaratory judgment action in Waukesha County Circuit Court seeking a declaration that the restrictive covenants in the employment agreement were "unenforceable, null and void." Without filing an answer, Huffy moved to dismiss, contending that the employment agreement contained a choice of forum and choice of law clause that required any dispute to be resolved by the application of Ohio law in either state or federal Ohio courts. In addition to bringing the motion in Waukesha county circuit court, Huffy filed a complaint in Ohio state court against Beilfuss and NMS seeking enforcement of the employment agreement along with compensatory and punitive damages. Approximately one month after Huffy filed the action in state court, Beilfuss and NMS removed the case to federal court.

¶ 4. In Waukesha county circuit court, Huffy argued that the choice of forum and choice of law clause in the employment agreement was clear and unambiguous and Beilfuss contractually obligated himself to assert any claim he had against Huffy in an Ohio court. Relying upon Kohler Co. v. Wixen, 204 Wis. 2d 327, 555 N.W.2d 640 (Ct. App. 1996), Huffy contended that the court had to enforce the forum selection clause because it was not unconscionable. In response, Beilfuss countered that the clause was ambiguous because it states that employee "irrevocably submits" to Ohio jurisdiction and then states only that the employee agrees that claims "may" be brought in Ohio courts. He also asserted that under Bush v. National School Studios, Inc., 139 Wis. 2d 635, 407 N.W.2d 883 (1987), the clause was unenforceable because it failed to pass the "unconscio-nability test."

¶ 5. The circuit court granted Huffy's motion. The circuit court rejected Beilfuss' claim that the provision is ambiguous. It concluded that the parties agreed that disputes would be heard in Ohio courts, Ohio law would be applied, and nothing otherwise invalidated the clause. Beilfuss appeals.

Discussion

¶ 6. Whether or not the choice of forum clause and choice of law clause are enforceable requires interpretation of the employment agreement. Interpretation of a contract is a question of law which this court reviews de novo. Yauger v. Skiing Enters., Inc., 206 Wis. 2d 76, 80, 557 N.W.2d 60 (1996).

¶ 7. The clause at the center of this controversy provides:

GOVERNING LAW
12. This Agreement shall be governed and construed according to the laws of the State of Ohio without giving effect of any choice or conflict of law provision or rule (whether of the State of Ohio or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Ohio. EMPLOYEE hereto irrevocably submit(s) to the jurisdiction of the federal or state courts located in the State of Ohio over any dispute arising out of or relating to this agreement. EMPLOYEE irrevocably agrees that all claims in respect of such dispute or proceeding may be heard and determined in such Courts. EMPLOYEE hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which he or she may now or hereafter have to the laying of venue of such dispute brought in such court or any defense of inconvenient forum in connection therewith.

¶ 8. Beilfuss argues that section 12 is ambiguous or unenforceable because it is procedurally and substantively unconscionable. We reject his contention that section 12 is ambiguous. Use of the phrases "irrevocably submit(s)," or "irrevocably agrees," and "irrevocably waives" overcomes any suggestion that the use of the word "may" creates a patent ambiguity. We also reject his argument centered on unconscionability. We are not convinced that section 12 presents both a quantum of procedural and a quantum of substantive unconscionability. See Leasefirst v. Hartford Rexall Drugs, Inc., 168 Wis. 2d 83, 88, 90, 483 N.W.2d 585 (Ct. App. 1992) (a forum selection clause is enforceable unless the contract provision is unconscionable, that is when there is a certain quantum of procedural plus a certain quantum of substantive unconscionability). Particularly, it is not unreasonable for a large multinational corporation to draft an employment contract requiring litigation to take place in its home state. Kohler, 204 Wis. 2d at 341.

¶ 9. We now turn to Beilfuss' argument that section 12 is unenforceable. Section 12 embodies both a choice of law clause and a choice of forum clause and presents us with the classic conundrum: "Which came first, the chicken or the egg?" Should we construe each clause separately and, if so, in what order? Or, should we construe the clauses together?

¶ 10. We find guidance in Hall v. Superior Court, 150 Cal. App. 3d 411, (Cal. App. 4 Dist. 1983). In Hall, two California investors, Thomas L. Hall and Lloyd C. Howard, exchanged their interests in an oil and gas limited partnership in return for stock in a Utah corporation. Id. at 413-14. Although all of the parties were California residents, they met at an airport in Nevada to consummate the transaction; the contract contained both a forum selection clause and a choice of law clause identifying Nevada as the selected forum and governing law. Id. Approximately one year later, a dispute arose and Howard and Hall commenced an action in the California courts that alleged, among other claims, three causes of action grounded on violations of California's Corporation Code. Id. Relying upon a decision from the California Supreme Court, the trial court granted the defendants' motion for a stay of any California litigation based upon the forum selection and choice of law provisions in the contract. Id. at 415.

¶ 11. The California Court of Appeals reversed. The court of appeals faulted the trial court for failing to reach the public policy issues of protection of securities investors and potential evasion of corporate security laws:

In our view... these considerations are inextricably bound up in the question of the validity of the choice of law provision; and a determination as to the validity of the choice of law provision is prerequisite to a determination of whether the forum selection clause should be enforced.

Id. at 416. The court explained that California generally respects choice of law provisions in contracts except "an agreement designating [a foreign] law will not be given effect if it would violate a strong California public policy." Id. at 417 (citation omitted).

¶ 12. The court of appeals turned to considering whether there were strong reasons to invalidate the choice of law provision and found that there were two. First, the court recognized California's policy to protect the public from fraud and deception in securities transactions. Id. Second, the court recognized that a provision of California's Corporate Securities Law rendered void any contractual provision purporting to waive or evade the law. Id. at 417-18. The court invalidated the choice of Nevada law provision in contract because it violated the California Corporate Securities Law and the public policy of California and, for that reason, it also held that the enforcement of the forum selection clause would be unreasonable. Id. at 418.

¶ 13. We agree with the approach taken by the Hall court. Determining the validity of the choice of law provision requires that we pay close attention to public policy considerations. As such, the validity of the choice of law provision is a precondition to determining the enforceability of the forum selection provision. In Bush, 139 Wis. 2d at 642, the Wisconsin Supreme Court acknowledged, like the Hall court, that "parties to a contract may expressly agree that the law of a particular jurisdiction shall control their contractual relations." The supreme court held that this was not an unqualified proposition; this state's important public policy considerations would trump a choice of law provision selecting a foreign jurisdiction's law as controlling. Bush, 139 Wis. 2d at 642.

A precise delineation of those policies which are sufficiently important to warrant overriding a contractual choice of law stipulation is not possible. In general, however, statutes or common law which make a particular type of contract enforceable, e.g., usury laws, or which make a particular contract provision unenforceable, e.g., laws prohibiting covenants not to compete, or that are designed to protect a weaker party against the unfair exercise of superior bargaining power by another party, are likely to embody an important state public policy.

Id. at 643 (emphasis added).

¶ 14. The public policy concerns with covenants not to compete can be found in the explicit purpose of Wis. Stat. § 103.465, which is to invalidate covenants that impose unreasonable restraints on employees. Heyde Cos., Inc. v. Dove Healthcare, LLC, 2002 WI 131, ¶ 13, 258 Wis. 2d 28, 654 N.W.2d 830. The Heyde court wrote, "[T]he fundamental right of a person to make choices about his or her own employment is well-established. '[N]o one has the legal right... to deprive a person of the right to labor for whomsoever he will, with the consent of such other.'" Id., ¶ 22 (citation omitted).

¶ 15. Moreover, Wis. Stat. § 103.465 makes it the public policy of this state that "[a]ny.. . restrictive covenant imposing an unreasonable restraint is illegal, void and unenforceable even as to so much of the covenant. . . as would be a reasonable restraint." Gen. Med. Corp. v. Kobs, 179 Wis. 2d 422, 431, 507 N.W.2d 381 (Ct. App. 1993) (citation omitted). On the other hand, Ohio law permits selective enforcement or judicial modification of an unreasonable covenant not to compete so as to enforce the covenant deemed reasonable. Raimonde v. Van Vlerah, 325 N.E.2d 544, 547 (Ohio 1975).

¶ 16. Consequently, we hold the choice of law provision in the employment agreement violates the public policy of this state and reverse the circuit court's conclusion that it is enforceable. Further, we hold that because the choice of law provision is invalid, the enforcement of the forum selection provision would be unreasonable. Hall, 150 Cal. App. 3d at 418.

¶ 17. The rule of law in Wisconsin is that a forum selection clause is enforceable unless the contract provision is substantively unreasonable in view of the bargaining power of the parties. Leasefirst, 168 Wis. 2d at 88. However, the bargaining power of the parties is not the only circumstance that can cause a forum selection clause to be unreasonable. Historically, forum selection clauses were disfavored, but in M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972), the United States Supreme Court held that such clauses are prima facie valid and should be enforced unless enforcement is shown to be unreasonable under the circumstances. This approach is reflected in Restatement (Second) of Conflict of Laws § 80 (1971):

The parties' agreement as to the place of the action cannot oust a state of judicial jurisdiction, but such an agreement will be given effect unless it is unfair or unreasonable.

The comment to this section notes that a forum selection provision will be enforced "if to do so would be fair and reasonable." Id. cmt. a (1971). In explaining Bremen, one commentator wrote:

In the Supreme Court's view.. . [c]ourts should enforce the [forum selection] clauses unless the resisting party can show that enforcement is " 'unreasonable' under the circumstances." A clause might be unreasonable if the forum chosen was "seriously inconvenient," or if the clause was touched by "fraud, undue influence, or overweening bargaining power," or if the clause violated a strong public policy of the forum in which the suit is actually brought.

15 Grace Mclane Giesel, Corbin on Contracts § 83.6 at 283-84 (Joseph M. Perillo ed., rev. ed. 2003).

¶ 18. Here, it is unreasonable to enforce the forum selection clause because it violates Wisconsin's strong public policy governing covenants not to compete that we have previously identified and discussed. There is also a very practical reason why enforcement is unreasonable. It is logical to have a court familiar with Wisconsin's statutory and common law covering covenants not to compete apply the law rather than a court in another forum, which is unfamiliar with Wisconsin's law or public policy supporting the law. Cf. Marsh v. Farm Bureau Mut. Ins. Co., 179 Wis. 2d 42, 58-59, 505 N.W.2d 162 (Ct. App. 1993) ("A Minnesota court applying Minnesota law to a Minnesota contract could more efficiently resolve this matter than a Wisconsin court potentially faced with applying Minnesota law."). Because enforcement of the forum selection clause is unreasonable, the employment agreement's severability clause does not provide a safety net.

¶ 19. While the severability clause does not save the forum selection provision, it does save the balance of the employment agreement. See Save Elkhart Lake, Inc. v. Village of Elkhart Lake, 181 Wis. 2d 778, 791, 512 N.W.2d 202 (Ct. App. 1993). After striking the choice of law and forum selection provisions because they are null and void, the parties are left with an employment agreement, including the covenant not to compete, that is very nearly ready for interpretation under Wisconsin law by a Wisconsin court. We note that instead of filing a responsive pleading to Beilfuss' declaratory judgment action, Huffy filed a motion to dismiss based on the provisions we have declared null and void. Therefore, upon remand to the circuit court, the court shall permit Huffy to file a responsive pleading within a reasonable time and place this action on its calendar, Wis. Stat. § 802.10, for resolution of all issues identified and joined in the pleadings.

Conclusion

¶ 20. We reverse the circuit court's order that the forum selection and choice of law provisions of the employment agreement are enforceable. We hold the choice of law provision is unenforceable because it violates Wisconsin's long-standing public policy controlling covenants not to compete, in that Wisconsin does not permit severability as a matter of public policy, while Ohio does. Moreover, we hold that because important public policy considerations are involved, it is unreasonable to enforce the forum selection provision. We remand this matter to the circuit court for proceedings not inconsistent with this opinion.

By the Court. — Order reversed and cause remanded with directions.

       Because we are reviewing the disposition of a motion to dismiss, we summarize the allegations of the complaint, taking them as true for purposes of this appeal. Brown v. State, 230 Wis. 2d 355, 358 n.1, 602 N.W.2d 79 (Ct. App. 1999).

        Smith, Valentino & Smith, Inc. v. Superior Court, 551 P.2d 1206 (Cal. 1976).

       Huffy conceded at the motion hearing in the circuit court that there was a difference between Ohio and Wisconsin law regarding the enforcement of a covenant not to compete.
      The employment agreement takes advantage of Ohio's approach in section 14, "Invalid Clauses." It provides:
      In the event that Paragraph 5 [Non-Competition] thereof should ever be adjudicated by a court of competent jurisdiction to exceed the limitations permitted by applicable law, as determined by such court in such action, then such provisions will be deemed reformed to the maximum limitations permitted by applicable law, the parties hereby acknowledging their desire that in such event such action be taken.

       Section 14 of the employment agreement provides, in pertinent parts:
      [T]he provisions of this Agreement are severable. Therefore, any term or provision of this Agreement which shall prove to be invalid, void or illegal shall in no way effect, impair or invalidate any other term or provision herein and such remaining terms or provisions shall remain in full force and effect as if executed with the unenforceable or invalid provision or portion thereof eliminated.