author: PER CURIAM.

text:
    State of Wisconsin, Plaintiff, v. Christine M. Quackenbush, Defendant. [Case No. XX-020489-CR.] State of Wisconsin, Plaintiff, v. Michael D. Lee, Defendant. [Case No. XX-020505-CR.]
    Court of Appeals

      Nos. XX-020489-CR, XX-020505-CR.

      Submitted on motions November 17, 2004 and November 22, 2004.

    Decided December 30, 2004.

    2005 WI App 2
    (Also reported in 692 N.W.2d 340.)

      On behalf of the defendant, Quackenbush, the cause was submitted on the motion of Tyler J. Tripp of Osborne & Goodman, S.C., Sparta.
    On behalf of the defendant, Lee, the cause was submitted on the motion of Patrick M. Donnelly, assistant state public defender, Madison, and Thomas F. Locante, assistant state public defenders, LaCrosse.
    On behalf of the plaintiff, State of Wisconsin, the cause was submitted on the response of James M. Freimuth, assistant attorney general and, Peggy A. Lautenschlager, attorney general.
    Before Deininger, EJ., Vergeront and Higginbotham, JJ.
   PER CURIAM.

¶ 1. Christine Quackenbush and Michael Lee move separately for extensions of the time to file a notice of intent to pursue postconviction relief. The main issue is whether our analysis of their motions is determined by State v. Evans, 2004 WI 84, 273 Wis. 2d 192, 682 N.W.2d 784. We conclude that Evans does not determine our analysis. In addition, we conclude that the motions show good cause for the requested extensions. Therefore, we grant the motions.

I. BACKGROUND

¶ 2. A brief review of the postconviction process under Wis. Stat. Rule 809.30 (2001-02) will set the context for these motions. A defendant commences the postconviction process by filing in circuit court, within twenty days after sentencing, a notice of intent to pursue postconviction relief. Rule 809.30(2)(a). If the notice requests representation by the State Public Defender, the clerk of the circuit court sends a copy of the notice to that office, which may then appoint counsel and order transcripts and the court record. Rules 809.30(2)(c)-(g). Within sixty days after the later of service of the transcript or record, the defendant may file either a postconviction motion or notice of appeal. Rule 809.30(2)(h). Further proceedings and decisions then occur in circuit court or this court.

¶ 3. The appellate rules in Wis. Stat. ch. 809 provide this court with the authority to enlarge most times prescribed by those rules, including all times provided in Wis. Stat. Rule 809.30. The enlargement rule, Wis. Stat. Rule 809.82(2)(a), provides in relevant part that, except as provided elsewhere, "the court upon its own motion or upon good cause shown by motion, may enlarge or reduce the time prescribed by these rules or court order for doing any act, or waive or permit an act to be done after the expiration of the prescribed time."

¶ 4. Quackenbush's trial counsel filed on her behalf a motion for an extension of the time to file a notice of intent to pursue postconviction relief. The motion sought an extension of slightly more than three months for two misdemeanor convictions. The ground for the motion was that trial counsel was under a mistaken impression as to what deadline applied in misdemeanor cases. Lee's motion, also filed by trial counsel, sought an extension of one day for a felony conviction. The motion explained that counsel filed the notice of intent twenty-one days after sentencing, but counsel is unable to determine exactly why it was late. Counsel makes an "educated guess" that he either miscalculated the proper date or, because the notice was signed on the twentieth day, he may have failed to ensure that his staff knew it must be filed the very same day.

¶ 5. Shortly before these motions were filed, we ordered the State, in two cases that are not discussed in this opinion, to address our authority to decide these types of extension motions in light of Evans. The State responded to our order by arguing that the holding in Evans bars us from granting extensions to file a notice of intent to pursue postconviction relief when the ground for the motion is ineffective assistance of counsel. The State further argued that, under Evans, the movants in cases like these must file habeas petitions in this court alleging ineffective assistance by trial counsel for failing to timely file a notice of intent.

¶ 6. When Quackenbush and Lee filed their motions, we noted that the grounds for the motions could be construed as alleging ineffective assistance of counsel. We advised the parties that we would assume the State takes the same legal position that it had on the earlier motions. We provided counsel for Quackenbush and Lee with time to reply to the State's arguments, which one of them did. We also provided the State with an opportunity to respond to the motions now before us. The State responded to Lee's motion by stating that it does not oppose the one-day extension, and it did not respond to Quackenbush's motion. Finally, we granted permission for the Office of the State Public Defender to submit a non-party response to the motions.

II. ANALYSIS

¶ 7. In Evans, this court had granted a lengthy extension of the time for the defendant to file a post-conviction motion, using our extension authority under Wis. Stat. Rule 809.82. Evans, 273 Wis. 2d 192, ¶¶ 11-13. The ground for the motion was that Evans had not properly waived his right to appellate counsel during his initial postconviction review, which had terminated without the filing of either a postconviction motion or notice of appeal. Id., ¶¶ 7, 11. After we granted the extension, Evans filed a postconviction motion and then an appeal to this court, in which we reversed and remanded for a new trial on one count. State v. Evans, No. 02-1869-CR, unpublished slip op. ¶ 15 n.2 (WI App Jul. 24, 2003). The State argued in the supreme court that our extension was improper. Evans, 273 Wis. 2d 192, ¶ 3. The supreme court agreed, concluding that we had erroneously exercised our discretion by using our extension authority under Wis. Stat. Rule 809.82 instead of requiring Evans to file a habeas corpus petition in this court alleging ineffective assistance of appellate counsel. Evans, 273 Wis. 2d 192, ¶ 59. That type of petition is often referred to as a Knight petition. See State v. Knight, 168 Wis. 2d 509, 484 N.W.2d 540 (1992).

¶ 8. The State argues that Evans also bars this court from using its extension authority in Wis. Stat. Rule 809.82 to extend the time to file a notice of intent to pursue postconviction relief when the basis for the motion is ineffective assistance of counsel. The State argues that the rationale of Evans is equally valid in this context, and that a movant's proper remedy is a habeas petition in this court alleging ineffective assistance of trial counsel. Quackenbush and the State Public Defender argue that the motions before us are distinguishable from the one in Evans in several ways, and that there are sound policy reasons not to extend that decision beyond its context. We agree.

¶ 9. On its face, Evans is concerned only with extensions of the time to file a postconviction motion, when the ground for the motion could be construed as ineffective assistance of appellate counsel. The question, then, is whether Evans should be extended to bar extensions of the time to file a notice of intent to pursue postconviction relief, when the ground for the motion could be construed as ineffective assistance of trial counsel. We conclude that it should not be, and therefore we decide these motions by using the "good cause" standard provided in Wis. Stat. Rule 809.82. Extending Evans to notices of intent is not supported by sound policy reasons and might have undesirable and unintended side effects.

¶ 10. As the State Public Defender observes, our current method of addressing late notices of intent to pursue postconviction relief via extension motions is long established and has generally worked well. We are unaware of any substantial prior complaint from parties on either side, or from the public, to our application of the "good cause" standard in deciding whether to permit a notice of intent to be filed beyond the twenty-day time limit prescribed by rule. Although we do not have statistics readily available, we regularly receive extension motions for notices of intent. It is safe to say that each district of this court receives several such motions per month, and some receive more. Some of the motions could not be construed as alleging ineffective assistance of counsel, but a significant number could be so characterized.

¶ 11. In Evans, the supreme court noted that this court " 'has a generally lenient policy about granting extensions that will enable a criminal defendant to prosecute an appeal.'" Evans, 273 Wis. 2d 192, ¶ 38 (citation omitted). We agree with this assessment, at least with respect to extensions sought within a limited period of time after the deadline for filing a notice of intent has passed. Although the court has not established firm guidelines for deciding extension motions, the judges of this court generally consider a number of factors in deciding whether to grant an extension. The longer the extension that is sought, the greater the showing that is generally required to satisfy us that there is good cause for granting it.

¶ 12. Because the notice of intent is the document that commences the postconviction process, the denial of an extension motion effectively precludes direct review of a criminal conviction under Wis. Stat. Rule 809.30. A defendant may still be able to obtain relief from the conviction or sentence under Wis. Stat. § 974.06, but he or she will not be entitled to appointed counsel in doing so and may face limits on the types of issues that can be raised. See State ex rel. Warren v. County Court of Shawano-Menominee County, 54 Wis. 2d 613, 617, 197 N.W.2d 1 (1972). Defendants obviously have a strong personal interest in having the validity of their convictions and sentences reviewed, and there are also strong public and judicial interests in ensuring that convictions and sentences are factually, legally and procedurally correct.

¶ 13. The social costs of an erroneous conviction can be very high, and that is perhaps why the deadline for filing a notice of intent to pursue postconviction relief has not been declared inviolable, as has, for example, the deadline for filing a notice of appeal in most civil cases. See Wis. Stat. Rule 809.82(2)(b). When the legislature or the supreme court has created non-extendable deadlines affecting appellate review, they have generally done so by statute or rule. See, e.g., Wis. Stat. § 808.04(7m) (time to file notice of intent to appeal in termination of parental rights cases may not be enlarged); Rule 809.82(2)(b) (time to file certain notices of appeal may not be enlarged). No similar absolute deadline currently exists for filing notices of intent.

¶ 14. Factors that we may consider in granting an extension for the filing of a notice of intent under Wis. Stat. Rule 809.82(2)(a) include the extent to which the delay appears to have been without fault of the defendant; the promptness of the defendant's request for an extension; and the avoidance of a disproportionate expenditure of judicial resources to make factual findings regarding requests for relatively short extensions. When deciding extension requests, we also seek to screen out defendants who have simply changed their minds after experiencing confinement or after having their probation revoked, especially if a significant amount of time has elapsed since the conviction, and we consider the need of crime victims and the public for finality in criminal adjudications. These factors are not intended to be exhaustive, but merely to provide a sense of the factors we consider when acting on extension requests.

¶ 15. Defendants who can establish that they were deprived of their statutory right to direct appellate review of their criminal convictions because of ineffective assistance of counsel are entitled to have their direct appeal rights reinstated, regardless of the presence or absence of other factors. See Roe v. Flores-Ortega, 528 U.S. 470, 476-77 (2000) {Strickland test applies to claims that counsel was ineffective for failing to file the document that commences the postconviction process). The ineffective assistance of trial counsel analysis is limited to determining whether counsel's performance was deficient and whether the defendant was prejudiced by counsel's acts or omissions. Strickland v. Washington, 466 U.S. 668, 687 (1984). Our authority under Wis. Stat. Rule 809.82 to grant extensions for "good cause" invites a broader range of considerations than the Strickland test provides. We conclude that confining our analysis to the Strickland test for all extension requests that may appear to rest on claims of ineffective assistance of counsel would unwisely remove from our consideration other proper factors that might merit the granting of a request to extend the time for filing a notice of intent, given the public interest in permitting criminal convictions to be reviewed for error.

¶ 16. Turning to questions of procedure, we observe that converting certain extension motions into habeas petitions alleging ineffective assistance of counsel would add little to our ability to decide them. Our rules provide eleven days for responses to motions, see Wis. Stat. Rule 809.14(1), but the time for responding to a habeas petition is not much longer: fourteen days from service of our order for a response. See Wis. Stat. Rule 809.51(2). Although extension motions may be decided rapidly and without a response from the State, see Rule 809.14(2) and Evans, 273 Wis. 2d 192, ¶ 53, we are not required to dispose of them in that fashion. Instead, we customarily take the time that is necessary to properly consider the motion, in light of the grounds alleged and the length of the extension sought, with such input from the parties as will permit us to understand the circumstances that resulted in a late-filed notice of intent. Although it is true that under Rule 809.14(2) we may grant extension motions without waiting for a response, and that the same rule provides the opposing party with "a mere 11 days" to request reconsideration, see Evans, 273 Wis. 2d 192, ¶ 53, we can extend the times to both respond to a motion or request reconsideration, and we do so readily, if the State or other party actually seeks that relief within a reasonable time. For motions that present close calls and involve disputes of fact, fact finding may be necessary. Because we are not permitted or equipped to find facts, we can, and have in the past, remanded to the circuit court for fact finding when deciding both motions under Wis. Stat. Rule 809.82 and habeas petitions.

¶ 17. Finally, substituting a habeas petition for a motion for an extension of the time for filing a notice of intent would not affect the remedy that this court could grant. If counsel's error in commencing the postconviction process causes deprivation of the entire process, prejudice is presumed. Flores-Ortega, 528 U.S. at 481-86 (it is unfair to require an indigent, perhaps pro se, defendant to demonstrate that a hypothetical appeal might have had merit before any advocate has ever reviewed the record in search of grounds for appeal; rather, defendant need only show that, but for counsel's deficient performance, the defendant would have appealed); see also State ex rel. Seibert v. Macht, 2001 WI 67, ¶ 19, 244 Wis. 2d 378, 627 N.W.2d 881. The proper habeas remedy would be to restore the defendant to the position he or she would have occupied but for counsel's ineffectiveness. Betts v. Litscher, 241 F.3d 594, 597 (7th Cir. 2001); see also Seibert, 244 Wis. 2d 378, ¶ 20. In other words, if we were to construe certain of these motions as habeas petitions and find them meritorious, the relief sought would be exactly the same: an extension of the time for filing the notice.

¶ 18. Not only do we see little benefit accruing from the conversion of certain extension motions to habeas petitions, that practice might well raise other questions and entail adverse side effects. For example, if relief by extension motion is not available, but must instead be sought via habeas petition, should the petition be filed in this court or the circuit court? The supreme court directed in Evans that a habeas petition alleging ineffective assistance be filed in this court, but, there, the alleged ineffectiveness involved appellate counsel, and the court's direction was thus consistent with Knight. The State argues for the same procedure for notice-of-intent-extension requests involving ineffective assistance of trial counsel. The State, however, glosses over the fact that the attorney whose effectiveness is in question would have never appeared before us, and any deficient performance would thus have occurred in the circuit court, which might therefore be better positioned to initially assess counsel's effectiveness.

¶ 19. Furthermore, whichever court would be the proper one to entertain habeas petitions on the present facts, the basis for deciding them are, at best, unclear given the absence of present Wisconsin case law regarding the duties of trial counsel in connection with advising defendants regarding postconviction matters. The Supreme Court discussed in Flores-Ortega, 528 U.S. at 478, the analysis to be applied when a defendant alleges that counsel failed to file the document that commences the postconviction process. There is no published Wisconsin case law applying that analysis to our notice of intent procedure under Wis. Stat. Rule 809.30.

¶ 20. A possible unintended side effect of reading Evans to bar extensions for notices of intent to pursue postconviction relief when the ground is ineffective assistance, while extensions remain permitted for "good cause" on other grounds, is that the distinction may give defendants an incentive to plead in ways that deliberately avoid suggesting ineffective assistance of counsel, even if that would be the most appropriate characterization of what occurred. Moreover, as the State Public Defender points out, if motions alleging facts similar to those now before us must be construed as habeas petitions, they could not properly be filed by trial counsel because counsel would essentially be alleging his or her own ineffectiveness. See State v. Hensley, 221 Wis. 2d 473, 474, 585 N.W.2d 683 (Ct. App. 1998). We might thus be deprived of the opportunity to efficiently resolve notice-of-intent extension requests like the present ones on the basis of a trial counsel's candid acknowledgement of responsibility for the missed deadline. Finally, as the State Public Defender also points out, if we were to extend the Evans holding to the present facts, our doing so might logically compel our applying Evans to requests for extensions of all other deadlines prescribed by the appellate rules. For example, a motion by appellant's counsel to extend the time to file a statement on transcript or an appellate brief might have to be treated as a Knight petition, if the ground alleged is a calendaring error or counsel's failure to manage workload properly.

¶ 21. These problems are not insurmountable, of course, in that guidance on how to process and decide habeas petitions seeking extensions for filing notices of intent would be forthcoming in due time. We simply conclude that enduring the legal and procedural uncertainties involved and the amount of judicial resources necessary to resolve them are not warranted, given our authority to grant extensions under Wis. Stat. Rule 809.82 and the adequacy of our present practice of addressing late notices of intent under that authority.

¶ 22. In short, we believe it unwise and unhelpful to replace the good cause standard for deciding extension motions under Wis. Stat. Rule 809.82 with an ineffective assistance of counsel analysis when deciding requests for extensions of time to file notices of intent to pursue postconviction relief. Doing so would remove the benefits of that process that help ensure an efficient and just administration of the postconviction process. Although we agree with the supreme court that celerity is no substitute for reasoned judicial analysis of significant legal issues, see Evans, 273 Wis. 2d 192, ¶ 56, neither is a painstaking doctrinal analysis in every case a good substitute for the efficient and fair administration of the postconviction process. We conclude that it is neither necessary nor reasonable to discard our present method of addressing motions to extend the time for filing notices of intent.

III. RESOLUTION OF THESE MOTIONS

¶ 23. Having declined to extend Evans to apply to requests for extensions of time to file notices of intent to pursue postconviction relief, we review the motions now before us under the "good cause" standard provided in Wis. Stat. Rule 809.82(2)(a).

¶ 24. Quackenbush's motion seeks an extension of slightly more than three months for two misdemeanor convictions on the ground that trial counsel was under a mistaken impression as to what deadline applied in misdemeanor cases. The State has not responded to the motion. We grant the motion, considering that the length of the extension sought is not unreasonable, counsel states that the delay is not attributable to the defendant, and the State has not disputed these facts.

¶ 25. Lee's motion seeks an extension of one day for a felony conviction, based on his trial counsel's "educated guess" that counsel either miscalculated the proper date or failed to ensure that his staff knew it must be filed the same day it was signed. The State advises us that it does not oppose the motion, because "it is apparent that Lee intended to timely file a notice of intent, and because Lee acted promptly to remedy his one-delay." The State thus concedes that a one-day extension request, grounded on an apparently good-faith admission of error by trial counsel, need not be contested or investigated further, and that it should be granted. We agree and observe that our authority under Wis. Stat. Rule 809.82 to grant extensions of appellate deadlines for good cause was apparently conferred on us in order to address circumstances just such as those presented in this opinion. We grant Lee's motion.

By the Court. — Motions granted.

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

       For certain types of cases, the rule substitutes "postdispo-sition" for "postconviction" and "final adjudication" for "sentencing," and makes certain other changes. However, in this opinion we will use only the criminal terms, for the sake of clarity and because that is the context of these particular motions. However, our analysis is intended to apply to all proceedings under the rule.

       We note that the State's response does not analyze the motion in terms of ineffective assistance and appears to accept counsel's assertions in support of the motion without an independent fact finding. By choosing not to object, the State itself exercises the discretion it argues we should not be able to exercise when addressing extension requests that are arguably grounded on ineffective assistance of counsel.


source: Caselaw Access Project

author: NETTESHEIM, J.

license: Public Domain

text:
    State of Wisconsin, Plaintiff-Respondent, v. Eric D. Gillespie, Defendant-Appellant.

    Court of Appeals

      No. 04-1758-CR.

      Submitted on briefs November 23, 2004.

      Decided January 5, 2005.

    2005 WI App 35
    (Also reported in 693 N.W.2d 320.)

      On behalf of the defendant-appellant, the cause was submitted on the briefs of John A. Ward, of Law Office of John Anthony Ward, S.C., of Kenosha.
    On behalf of the plaintiff-respondent, the cause was submitted on the brief of Peggy A. Lautenschlager, attorney general, and Daniel J. O'Brien, assistant attorney general.

      Before Anderson, EJ., Nettesheim and Snyder, JJ.

       Petition to review denied 4-6-2005.

   NETTESHEIM, J.

¶ 1. Eric D. Gillespie is charged with felony abuse of a child pursuant to Wis. Stat. § 948.03(2)(b) (2001-02) and misdemeanor battery and disorderly conduct. Gillespie was bound over for trial following a preliminary hearing held before a court commissioner pursuant to Wis. Stat. § 757.69(l)(b). He then sought a "preliminary hearing de novo" in the circuit court on the felony charge. In support of his request for a second preliminary hearing, Gillespie relied on § 757.69(8), which permits the certification of a court commissioner's decision to the circuit court for a de novo hearing. The circuit court denied the request. We previously granted Gillespie's petition for leave to appeal the court's nonfinal order.

¶ 2. We conclude that the preliminary hearing provisions of the Criminal Procedure Code, particularly Wis. Stat. § 970.04 governing a second preliminary examination, preclude Gillespie's claim that he is entitled to a second preliminary hearing before the circuit court. As such, we affirm the order and remand for further proceedings.

Background

¶ 3. The underlying facts are brief and undisputed. Following a preliminary hearing, a circuit court commissioner found probable cause to believe that Gillespie had committed a felony and bound him over for trial. Gillespie subsequently filed a motion for a de novo preliminary hearing before the circuit court pursuant to Wis. Stat. § 757.69(8). At a hearing on the motion, the circuit court denied Gillespie's request for a de novo hearing, instead ruling that it would review a transcript of the preliminary hearing. Gillespie appeals.

Discussion

¶ 4. Gillespie argues that Wis. Stat. § 757.69 entitles him to a de novo second preliminary hearing before the circuit court. We begin with some well-established law regarding a preliminary hearing. There is no federal or state constitutional right to a preliminary hearing in Wisconsin. Johns v. State, 14 Wis. 2d 119, 123, 109 N.W.2d 490 (1961). The express statutory purpose of the preliminary hearing is to determine whether probable cause exists that the defendant has committed a felony which warrants binding the defendant over for trial. State v. Cotton, 2003 WI App 154, ¶ 17, 266 Wis. 2d 308, 668 N.W.2d 346. Pursuant to § 757.69(l)(b), a preliminary hearing may be conducted by a court commissioner.

¶ 5. Gillespie contends that the circuit court erred in denying his request for a de novo preliminary hearing following his bindover by the court commissioner. He rests his argument on Wis. Stat. § 757.69, which sets out the powers and duties of circuit court commissioners. The statute provides in relevant part:

[(l)](b) In criminal matters... [a] circuit court commissioner employed on a full-time basis may conduct the preliminary examination and arraignment and, with the consent of both the state and the defendant, accept a guilty plea....
(8) Any decision of a circuit court commissioner shall be reviewed by the judge of the branch of court to which the case has been assigned, upon motion of any party. Any determination, order, or ruling by a circuit court commissioner may be certified to the branch of court to which the case has been assigned, upon a motion of any party for a hearing de novo.

Id. (emphasis added). Specifically, Gillespie relies on the portion of § 757.69(8) that we have highlighted.

¶ 6. The question presented involves statutory construction and thus presents a question of law that we review de novo. See State v. Leitner, 2002 WI 77, ¶ 16, 253 Wis. 2d 449, 646 N.W.2d 341. "When interpreting a statute, our purpose is to discern legislative intent. To this end, we look first to the language of the statute as the best indication of legislative intent. Additionally, we may examine the statute's context and history." Village of Lannon v. Wood-Land Contractors, Inc., 2003 WI 150, ¶ 13, 267 Wis. 2d 158, 672 N.W.2d 275 (citation omitted).

¶ 7. The State contends that Wis. Stat. § 970.04 precludes Gillespie's request for a second preliminary hearing. The statute states:

Second examination. If a preliminary examination has been had and the defendant has been discharged, the district attorney may file another complaint if the district attorney has or discovers additional evidence.

Id. The State contends that this is the more specific statute governing the circumstances under which a second preliminary examination may occur and thus controls over the more general statute, Wis. Stat. § 757.69(8), relating to the powers of a court commissioner. See Gottsacker Real Estate Co. v. DOT, 121 Wis. 2d 264, 269, 359 N.W.2d 164 (Ct. App. 1984) (where two statutes relate to the same subject matter, the specific statute controls the general statute).

¶ 8. We agree with the State. Wisconsin Stat. § 757.69 is a part of Wis. Stat. ch. 757, entitled "General Court Provisions." The statute itself, as the title recites, is a compilation of the powers and duties of circuit court commissioners. The analysis of the statute by the Legislative Reference Bureau confirms this, stating that the purpose of the bill creating the statute was, in part, to consolidate all of the powers and duties of court commissioners into one chapter of the statutes. Legislative Reference Bureau Drafting File for AB 354, 2001-02 Session. In comparison, Wis. Stat. ch. 970 is part of Wisconsin's Criminal Procedure Code, which governs all criminal proceedings. See Wis. Stat. § 967.01. Wisconsin Stat. §§ 970.03 to 970.05 of the Criminal Procedure Code govern the procedures relating to preliminary hearings. Immediately following § 970.03, the statute that confers the right to a preliminary hearing, the legislature expressly addresses in § 970.04 the circumstances under which a second preliminary examination can be held. While the factual scenario set forth in § 970.04, one in which the defendant has been discharged and a new complaint filed, is different from that presented in Gillespie's case, it nevertheless reveals that the legislature had the opportunity to address a second examination in Gillespie's situation and chose not to do so. See A. and A.P. v. Racine County, 119 Wis. 2d 349, 354, 349 N.W.2d 743 (Ct. App. 1984).

¶ 9. We also observe that the Wisconsin Supreme Court has decreed that a motion to dismiss is the proper procedure for obtaining circuit court review of a court commissioner's bindover ruling and that such review is limited to a transcript of the preliminary examination. State ex rel. Dowe v. Circuit Court for Waukesha County, 184 Wis. 2d 724, 729, 733, 516 N.W.2d 714 (1994). We presume that the legislature acts with full knowledge of existing law, including court decisions on the topic, when enacting legislation. See DOR v. Johnson Welding & Mfg. Co., 2000 WI App 179, ¶ 16, 238 Wis. 2d 243, 617 N.W.2d 193. Therefore, we have considered whether the legislature's enactment of Wis. Stat. § 757.69(8) was aimed at overturning this well-established precedent for obtaining judicial review of a court commissioner's bindover decision. However, we see nothing in the legislative history of § 757.69 generally, or subsection (8) in particular, indicating that the legislature intended to so radically change the customary method of judicial review of a bindover ruling.

¶ 10. Because Wis. Stat. § 970.04 lays out the only scenario in which the legislature has recognized a statutory right to a second preliminary examination on the same charge, we reject Gillespie's contention that the circuit court erred in denying his request for a de novo preliminary hearing.

Conclusion

¶ 11. We conclude that Wis. Stat. § 970.04 of the Criminal Procedure Code specifically limits the availability of a second preliminary examination and precludes Gillespie's request for a de novo hearing under the more general Wis. Stat. § 757.69(8). We therefore affirm the circuit court's order denying Gillespie's request for a de novo preliminary hearing. We remand for further proceedings.

By the Court. — Order affirmed and cause remanded.

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

       Gillespie relies on Milwaukee County v. Louise M., 205 Wis. 2d 162, 555 N.W.2d 807 (1996), in support of his argument. There, the supreme court held that the subject of a Wis. Stat. ch. 51 mental commitment proceeding did not have a right to a de novo probable cause hearing following a court commissioner's determination that probable cause existed to hold the subject for further proceedings. Louise M., 205 Wis. 2d at 175-78. In so holding, the court noted that when the legislature has seen fit to accord such a right, it has done so by express legislation. Id. at 176. Gillespie seizes on this statement, contending that the later enactment of Wis. Stat. § 757.69(8) represents just such an express legislative statement. But, as we have noted, that statute represents a general compilation of a court commissioner's powers and duties. Pitted against the preliminary hearing provisions of the Criminal Procedure Code, and particularly the "Second Examination" provisions of Wis. Stat. § 970.04, the latter represent the more specific pronouncements of the legislature on this topic.

       We therefore do not address the State's alternative argument that to allow a de novo preliminary hearing under Wis. Stat. § 757.69(8) would lead to absurd and unreasonable results. See Gross v. Hoffman, 227 Wis. 296, 300, 277 N.W. 663 (1938) (only dispositive issues need be addressed). Because there is a more specific statute that governs second preliminary examinations, we also do not address Gillespie's contention that the legislative history of the more general § 757.69(8) supports his request for a de novo preliminary hearing.


author: PETERSON, J.

text:
    Rusk County Department of Health and Human Services, Petitioner-Respondent, Danielle K. Schultz, Petitioner, v. Leonard M. Thorson, Respondent-Appellant.
    Court of Appeals

      No. 04-2267-FT.

      Submitted on briefs November 17, 2004.

      Decided January 11, 2005.

    2005 WI App 37
    (Also reported in 693 N.W.2d 318.)

      On behalf of the respondent-appellant, the cause was submitted on the briefs of Carol A. Conklin of Conklin Law Office, Ladysmith.
    On behalf of the petitioner-respondent, the cause was submitted on the brief oí Michael R Weiler oí Weiler Law Office, Ladysmith.
    Before Cane, C.J., Hoover, PJ., and Peterson, J.
   PETERSON, J.

¶ 1. Leonard Thorson appeals an order obligating him to pay lying-in expenses for his children, as authorized under Wis. Stat. § 767.51(3)(e). Thorson argues the circuit court had no authority to order he was obligated to pay those expenses when, at the time of the order, he had no ability to pay. We agree and reverse the order.

BACKGROUND

¶ 2. Thorson is the father of twins born September 28, 2003. He resides with the children and their mother. The Wisconsin Medical Assistance Program paid the expenses associated with the birth of the twins.

¶ 3. On February 5, 2004, the Rusk County Department of Health and Human Services filed a paternity petition seeking, among other things, reimbursement for lying-in expenses. The parties agreed and the circuit court found that Thorson did not have the present ability to pay any of the expenses. Nevertheless, the court ordered that Thorson was obligated for the total of $4,332.50, although it held payment in abeyance. It also ordered Thorson to provide copies of his tax returns and to report to the County any change of address, employer or income.

STANDARD OF REVIEW

[1 — 4]

¶ 4. The authority of the circuit court in paternity actions is limited to that provided in the paternity statutes. State v. Charles R.P., 223 Wis. 2d 768, 771, 590 N.W.2d 21 (Ct. App. 1998). The interpretation of a statute and its application to a set of facts are questions of law that we review independently. Id. Our role is to give effect to the plain meaning of the words in the statute. State ex rel. Kalal v. Circuit Court for Dane County, 2004 WI 58, ¶ 45, 271 Wis. 2d 633, 681 N.W.2d 110. Accordingly, when interpreting a statute, we begin with the plain language of the statute. Id., ¶ 44. If the language is plain and unambiguous, we apply it as written without further inquiry. Id.

DISCUSSION

¶ 5. Wisconsin Stat. § 767.51(3)(e) authorizes the circuit court to order a "father to pay or contribute to the reasonable expenses of the mother's pregnancy and the child's birth, based on the father's ability to pay or contribute to those expenses." By the plain language of the statute, the court's ability to order payment is contingent on "the father's ability to pay." Wis. Stat. § 767.51(3)(e). Accordingly, because it is undisputed that Thorson had no ability to pay at the time of the hearing, the court had no authority to set his obligation to pay lying-in expenses.

¶ 6. The County argues that setting an obligation for payment is not the same as an order to pay. However, the circuit court's authority is limited to that provided by the statutes. Charles R.P., 223 Wis. 2d at 771. The County provides no statutory authority, and we can find none, for a court to obligate a father to pay lying-in expenses when he has no current ability to pay.

¶ 7. The County also argues that if courts lack the authority to impose an obligation for payment, even if the father has no ability to pay, it would "virtually eliminate collection of lying-in expense from a father." However, a county cannot collect the expense until a father has the ability to pay. Therefore, an order setting the obligation amount with payment held in abeyance does nothing to aid the County in collecting the expenses. When and if a father has the ability to pay, the court may order him to pay or contribute to the lying-in expenses. If the father's ability to pay changes, the order may be modified. Wis. Stat. §§ 767.51(6) and 767.32.

By the Court. — Order reversed.

       The document is titled "Order and Judgment."

       This is an expedited appeal under Wis. Stat. Rule 809.17. All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       Thorson also argues the circuit court erroneously exercised its discretion by applying the wrong legal standard. Because the interpretation of Wis. Stat. § 767.51(3)(e) is conclusive, we do not address this argument. See Gross v. Hoffman, 227 Wis. 296, 300, 277 N.W. 663 (1938) (only dispositive issues need be addressed).

       The County contends that the court's order was supported by the facts, since Thorson has a gross monthly income of $2,027.88 and has no physical, mental or emotional limitation on his earning ability. However, the County conceded in the circuit court that Thorson had no current ability to pay. The County cannot now be heard to argue that Thorson is able to pay, based on his income and lack of inhibitors to his earning ability. See State v. Michels, 141 Wis. 2d 81, 98, 414 N.W.2d 311 (Ct. App. 1987) (judicial estoppel bars litigant from argument directly contradictory to circuit court argument).


author: BROWN, J.

text:
    City of West Bend, Plaintiff-Respondent, v. Richard B. Wilkens, Defendant-Appellant.
    Court of Appeals

      No. 04-1871.

      Submitted on briefs November 26, 2004.

    Decided January 12, 2005.

    2005 WI App 36
    (Also reported in 693 N.W.2d 324.)

      On behalf of the defendant-appellant, the cause was submitted on the briefs of Waring R. Fineke of West Bend.
    On behalf of the plaintiff-respondent, the cause was submitted on the brief of Elizabeth A. Krueger, assistant city attorney.
   BROWN, J.

¶ 1. This case involves a question of admissibility versus weight of the evidence. Richard B. Wilkens, convicted of operating a vehicle with a prohibited alcohol concentration, complains that the field sobriety tests (FSTs) the arresting officer administered were unreliable because they failed to conform to the standardized procedures approved by the United States Department of Transportation's National Highway Traffic Safety Association. The trial court determined that the reliability of the tests was for the jury to decide. We agree that the procedures the officer employed go to the weight of the evidence, not its admissibility. We reject Wilkens' attempt to cast this case as one involving the use of scientific evidence, the reliability of which this court must determine before the fact finder may consider it. FSTs are not scientific tests. They are merely observational tools that law enforcement officers commonly use to assist them in discerning various indicia of intoxication, the perception of which is necessarily subjective. Moreover, it is not beyond the ken of the average person to understand such indicia and to form an opinion about whether an individual is intoxicated. The evidence was not without probative value and therefore was admissible.

¶ 2. The material facts in this case are not contested. They are as follows: Kenneth G. Onken, a city of West Bend police officer, worked the midnight shift on November 4, 2002. While operating his radar detector on Creek Road at approximately 2:00 a.m., he observed a motorcycle traveling fifty miles per hour. This speed exceeded the legal speed limit by twenty miles per hour, so Onken stopped the vehicle. When he approached the driver of the motorcycle, Wilkens, Onken noticed several signs of intoxication: red, glassy eyes, the odor of alcohol, Wilkens' admission that he had consumed a few beers at a local tavern, and slurred speech.

¶ 3. Because of these indicia of intoxication, Onken asked Wilkens to perform FSTs. He administered the three tests outlined in the West Bend police department's FST policy: (1) the alphabet test, (2) the finger-to-nose test, and (3) the heel-to-toe walk, in that order. Wilkens failed all three.

¶ 4. Based on Wilkens' performance on the FSTs, Onken requested a preliminary breath test. The sample indicated a blood alcohol concentration of .13 percent. Onken arrested Wilkens for operating a motor vehicle while under the influence of an intoxicant and transported him to St. Joseph's Hospital for a blood draw. The results of this test revealed a blood alcohol concentration of .19 percent.

¶ 5. Two citations resulted from this encounter, each for a separate violation of a municipal ordinance that adopts Wis. Stat. § 346.63 (2003-04), "Operating under influence of intoxicant or other drug." One violation was for operating his vehicle while under the influence of an intoxicant to the extent that he was incapable of safe driving. See § 346.63(1)(a). The other cited him for operating with a PAC. See § 346.63(l)(b).

¶ 6. Proceedings for this case began in the Mid-Moraine Municipal Court. Wilkens moved to suppress from use at trial all of the following evidence: (1) testimony by Onken relating to his administration of the FSTs and his interpretation of Wilkens' performance; (2) the PBT results; (3) all of Wilkens postar-rest statements and Onken's observations of Wilkens; and (4) the blood draw results. Wilkens argued as follows: the court could not consider Onken's administration of the three FSTs or Wilkens' performance of them because they were not scientifically reliable. Wilk-ens asserts that the three-test battery approved by NHTSA — the horizontal gaze nystagmus (HGN), walk and turn (WAT), and one-leg stand (OLS) — "is the only scientifically validated and reliable method for discriminating between impaired and unimpaired drivers." He observes that NHTSA specifically rejected the use of the finger-to-nose test and tests similar to the alphabet test as unreliable. Moreover, Wilkens points out, Onken's administration of the heel-to-toe test did not follow the NHTSA protocol for-the administration of WAT, which requires standardized administration and grading of various clues in order to reliably distinguish passing and failed performance. By contrast, he notes that Onken relied upon his own subjective assessment of Wilkens' performance.

¶ 7. Wilkens' argument continued: without the FSTs, Onken had no probable cause to request a PBT. Without the FST and PBT, Wilkens contends Onken also had no probable cause for the arrest. According to Wilkens, Onken's pre-FST observations did not rise to the requisite level of suspicion to satisfy the probable cause standard for either the PBT or the arrest. Thus, Wilkens concludes the court should also suppress the fruits of both.

¶ 8. The record contains no ruling on the suppression motion, but it is clear that the case proceeded to trial on December 18, 2003. The trial resulted in findings of guilt on both charges, and the court entered final judgment on January 9, 2004. Wilkens appealed to the Washington County Circuit Court.

¶ 9. Wilkens renewed his attempt to suppress all evidence Onken obtained subsequent to his administration of the FSTs. The trial court held a hearing on this suppression motion on May 14. Onken testified for the City, and Jeffrey Barber, a former law enforcement officer certified in FSTs, testified on behalf of Wilkens. Barber was familiar with several NHTSA studies with respect to the reliability of various FSTs.

¶ 10. At the conclusion of this hearing, the court denied Wilkens' motion. The court declined to mandate any particular combination or method of administering FSTs, opining that common sense plays a role in an officer's observations. It further opined that it is a jury question whether a person met the requisite level of impairment or whether alternative explanations were more persuasive. The parties could inform the jury's decision by questioning the officer's methods and presenting testimony about their reliability. The court found that probable cause existed, based on Wilkens' slurred speech, red and glassy eyes, the odor of intoxicants, and his admission to having been drinking, combined with his performance on the FSTs. With respect to the latter, the court paid special attention to Wilkens' balance problems and the fact that he not only recited the alphabet incorrectly but failed even to realize his mistake.

¶ 11. On May 18, the parties tried the case on stipulated facts. Citing Wilkens' performance on the FSTs, his speeding, and his high alcohol level as revealed by the blood test, the trial court found Wilkens guilty on both tickets but dismissed the violation based onWis. Stat. § 346.63(l)(a), driving under the influence of an intoxicant. Wilkens now appeals the order denying his suppression motion and the judgment of conviction on the § 346.63(l)(b) PAC violation.

¶ 12. The main thrust of Wilkens' appeal focuses on the purported unreliability of the FSTs. On the surface, he appears to raise a probable cause issue, i.e., this court should suppress the PBT results and all postarrest evidence because both the administration of the PBT and the arrest lacked probable cause. However, the sole basis for his claim that probable cause was lacking is his assertion that "Onken's FSTs were unreliable and his observations of and conclusions he drew from Wilkens' performance on the tests should be excluded from the probable cause analysis." Ultimately, he challenges the fact that the trial court even considered the FST evidence. Thus, his argument hinges upon whether the trial court erred in admitting the evidence.

¶ 13. The admissibility of evidence is within the trial court's discretion. State v. Peters, 192 Wis. 2d 674, 685, 534 N.W.2d 867 (Ct. App. 1995). We will not overturn its decision absent an erroneous exercise of such discretion. Id. The trial court is within its discretion so long as it examined the relevant facts, applied a proper legal standard, and reached a conclusion that a reasonable judge could reach through a demonstrated rational process. Id.

¶ 14. In Wisconsin, the general standard for admissibility is very low. Generally, evidence need only be relevant to be admissible. See Wis. Stat. § 904.02; State v. Eugenio, 219 Wis. 2d 391, 411, 579 N.W.2d 642 (1998) ("All relevant evidence is admissible unless otherwise provided by law"). Evidence is relevant when it is probative of any material fact. Wis. Stat. § 904.01 (Evidence is relevant if it has "any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence."). Even Wilkens does not argue that Onken's observations of his performance on the FSTs utterly lacked probative value. Certainly, when an officer — particularly one with sixteen years of law enforcement experience and who makes an average of four OWI arrests each month— determines that a driver fails not one but three FSTs, it is more probable that the person has an illegal blood alcohol concentration than if the officer determined he or she passed the tests. We cannot conclude that the trial court erred in considering the evidence.

¶ 15. Wilkens believes that the general rules for admissibility do not apply in this case. He attempts to characterize FSTs as scientific tests. He states: "These [FSTs] are tests, not lay observations as the City contends. When you test someone, it implies some scientific or measurable basis for determining something." Given his focus on the reliability of these tests, we understand him to argue that scientific evidence must be reliable before a court may admit and consider the evidence.

¶ 16. Although it is true that the rules of evidence sometimes require the exclusion of otherwise relevant and admissible evidence for policy reasons unrelated to probativeness, see State v. St. George, 2002 WI 50, ¶ 82, 252 Wis. 2d 499, 643 N.W.2d 777 (Sykes, J., concurring) (citing hearsay, character evidence, and evidence protected by privilege as examples), we reject Wilkens' argument on two grounds. First, FSTs are not "scientific tests." Second, even if they were, reliability is not a prerequisite to admitting scientific evidence in this state.

¶ 17. We turn first to the allegedly "scientific" nature of FST observations. Despite Wilkens' assertions to the contrary, the FSTs that Onken administered are not "scientific." Indeed, the fact that Onken relied on his own subjective judgment — one of Wilkens' major complaints in citing why the tests were flawed — in deciding whether Wilkens passed or failed indicates that there was no "science" whatsoever in forming his conclusions. Onken testified that his purpose in administering FSTs is to determine whether a suspect can follow directions and whether the person can divide his or her attention and exhibit fine motor skills. One can perceive any of these abilities and conclude that their impairment is an indicator of intoxication without employing a scientific test. FSTs simply give an officer an opportunity to look for such indicia. They are observational tools, not litmus tests that scientifically correlate certain types or numbers of "clues" to various blood alcohol concentrations.

¶ 18. Further, we remain unconvinced by the proposition that following the standardized procedures that NHTSA recommends leads to scientifically valid determinations. Barber gave the following testimony: (1) NHTSA has recommended only HGN, WAT, and OLS as "reliable indicators" of either impairment or intoxication; (2) a correlation exists between arrest decisions based on those three tests and whether the test subject actually has a blood alcohol level in excess of the legal limit; (3) when an officer deviates from the standardized procedures, NHTSA considers the result "invalid"; and (4) the standardized procedures require an officer to look for specific "clues" in assessing satisfactory performance versus failure.

¶ 19. Other than the bare assertion that the recommended standardized tests are both scientifically reliable and valid, the record contains no indication that they are based on science. Any scientific explanation for why the standardized procedures yield any particular result is completely absent. Standardization may lead to reliability in the sense that where examiners look for the same "clues" to shape their observations of the subject, their observations are likely to be more similar. Similarity does not equate to more correct observations, however. "The mere fact that the NHTSA studies attempted to quantify the reliability of the field sobriety tests in predicting unlawful [blood alcohol contents] does not convert all of the observations of a person's performance into scientific evidence." State v. Meador, 674 So. 2d 826, 831-32 (Fla. Dist. Ct. App. 1996). The evidence before us simply does not allow us to conclude that following the NHTSA protocol yields scientifically correct results. For this reason, we will not treat Onken's observations with respect to Wilkens' performance of the FSTs any differently from his other subjective observations of Wilkens, i.e., his red and glassy eyes, slurred speech, his speeding, and the smell of alcohol on his person.

¶ 20. We note that other courts and commentators have remained similarly unconvinced that FST observations are based on science. The Meador court stated that, with the exception of observations with respect to the HGN test, a police officer's observations of FST performance should be "placed in the same category as other commonly understood signs of impairment, such as glassy or bloodshot eyes, slurred speech, staggering, flushed face, labile emotions, odor of alcohol or driving patterns." Id. at 832. The court in United States v. Horn, 185 F. Supp. 2d 530 (D. Md. 2002), also faced the issue of whether observations resulting from the administration of FSTs were admissible evidence. In that case, the court wrote:

There is no factual basis before me to support the NHTSA claims of accuracy for the WAT and OLS tests or to support the conclusions about the total number of standardized clues that should be looked for or that missing a stated number means the subject failed the test. There is very little before me that suggests that the WAT and OLS tests are anything more than standardized procedures police officers use to enable them to observe a suspect's coordination, balance, concentration, speech, ability to follow instructions, mood and general physical condition — all of which are visual cues that laypersons, using ordinary experience, associate with reaching opinions about whether someone has been drinking.

Id. at 558. Moreover, as one commentator points out, the WAT and OLS tests have only "face validity"; this level of validity is the lowest possible, and generally academia does not accept it because it "rests on the investigator's subjective evaluation of the appropriateness of the instrument for measuring the concept rather than whether the instrument measures what the researcher wishes to measure." Mimi Coffey, DWI: Modern Day Salem Witch Hunts, The Champion, Nov. 2004, at 51, 52 (emphasis added) (citation omitted).

¶ 21. Finally, even if science "validates" observations that police officers make when administering FSTs, that would not mean the observations themselves are based on scientific phenomena rather than plain common sense. Normally, scientific evidence involves highly technical or specialized information beyond the ken of the average person's general knowledge. Courts admit expert testimony in order to help the finder of fact understand and apply this information. Ordinary individuals are readily familiar with the manifestations of alcohol consumption, both physical and mental. They do not need to hear expert testimony about how to discern drunkenness. Moreover, they know intuitively that a PAC and drunkenness often accompany each other. They do not need "scientific evidence" to tell them so any more than they require an explanation of the theory of gravity in a suit where a plaintiff claims to have been injured by a fallen object.

¶ 22. Even if we were to conclude that Onken's observations during the FSTs were scientific evidence, the alleged unreliability of these tests would not necessarily render the evidence inadmissible. Wilkens' contrary assumption appears to presuppose an admissibility standard similar to that which the federal courts employ. This standard, which the United States Supreme Court announced in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), assigns federal judges a significant gatekeeping role over scien-tifie evidence. "[U]nder the [Federal Rules of Evidence] the trial judge must ensure that any and all scientific testimony or evidence admitted is not only relevant, but reliable." Id. at 589 (emphasis added). However, Wisconsin is not a.Daubert state. See Peters, 192 Wis. 2d at 687.

¶ 23. Wisconsin, unlike the federal courts, considers the reliability of scientific evidence a question of weight and credibility for the trier of fact to decide. Id. at 690. A party can challenge the reliability of such evidence through cross-examination or other means of impeachment. Id. The evidence is admissible as long as it is relevant, the witness testifying to such evidence is a qualified expert, and the evidence will assist the fact finder in understanding the evidence or determining some factual issue. Id. at 687-88. Wilkens has not challenged the trial court's consideration of the FST evidence on any of these grounds.

¶ 24. We hold that nothing precluded the trial court from considering Onken's testimony about what he observed when he administered the FSTs to Wilkens. The reliability of this evidence was totally irrelevant for purposes of its admissibility. We are unconvinced that this evidence was scientific rather than a commonsense observation made possible by means of observational tools — the FSTs. Because the evidence has probative value, the general standards for admissibility call for its admission. Moreover, even if the evidence was based on science, Wisconsin is not a Daubert state. Hence, an admissibility challenge premised exclusively on the unreliability of the observations misses the mark.

By the Court. — Judgment and order affirmed.

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

       Wilkens quotes NHTSA's FST instructor manual.

       The HGN test attempts to correlate eye movement with the person's level of intoxication. Jerkiness in eye movements is not a commonly known indicator of intoxication. Moreover, it was not among the tests Onken administered. Thus, our discussion here should not he read to pass on whether that test has a scientific basis.


author: LUNDSTEN, J.

text:
    State of Wisconsin, Plaintiff-Respondent, v. American Family Mutual Insurance Company, Intervenor-Defendant-Appellant.
    Court of Appeals

      No. 03-2295.

      Submitted on briefs January 20, 2004.

    Decided January 13, 2005.

    2005 WI App 23
    (Also reported in 693 N.W.2d 79.)

      On behalf of the intervenor-defendant-appellant, the cause was submitted on the briefs oí David J. Pliner of Corneille Law Group, L.L.C., Madison.
    On behalf of the plaintiff-respondent, the cause was submitted on the brief of Charlotte Gibson, assistant attorney general, and Peggy A. Lautenschlager, attorney general.
    Before Dykman, Lundsten and Higginbotham, JJ.
   LUNDSTEN, J.

¶ 1. The question raised by this appeal is whether a standard homeowner's insurance policy, issued to a landowner by American Family Insurance Company, provides coverage for costs incurred by the State of Wisconsin in suppressing a forest fire that started on the owner's land. We conclude that American Family's policy provides coverage.

Background

¶ 2. The State initially filed this action against landowner Keith Gouwens, alleging that he was responsible for fire suppression costs arising out of a 678-acre fire that broke out on his property. There is no dispute for purposes of this appeal that Gouwens is legally responsible to the State for fire suppression costs under Wis. Stat. § 26.14 (2001-02). Section 26.14(9)(b) reads:

Ob) Any person who sets a fire on any land and allows such fire to escape and become a forest fire shall be liable for all expenses incurred in the suppression of the fire by the state or town in which the fire occurred.

¶ 3. American Family, Gouwens' homeowner's insurance carrier, intervened and immediately asked to be dismissed as a party. American Family requested a ruling from the circuit court that American Family had no duty to defend or indemnify Gouwens because the State's fire suppression costs were not covered under Gouwens' homeowner's insurance policy.

¶ 4. The policy language at issue is the following:

Property damage means physical damage to or destruction of tangible property, including loss of use of this property. Loss of use of tangible property does not include any resulting loss of value of such damaged property.
We will pay, up to our limit, compensatory damages for which any insured is legally liable because of bodily injury or property damage caused by an occurrence covered by this policy.

¶ 5. The circuit court denied American Family's request to be dismissed. The court concluded that Gouwens1 policy provided coverage for the State's fire suppression costs. The parties subsequently requested and received a final order after stipulating to dispose of other issues in this action, thereby permitting American Family to appeal and challenge the circuit court's decision on coverage.

Discussion

¶ 6. The interpretation of an insurance policy is a question of law that we review de novo. Danbeck v. American Family Mut. Ins. Co., 2001 WI 91, ¶ 10, 245 Wis. 2d 186, 629 N.W.2d 150. We first determine whether the policy language is ambiguous. State Farm Mut. Auto. Ins. Co. v. Langridge, 2004 WI 113, ¶ 41, 275 Wis. 2d 35, 683 N.W.2d 75. Insurance policy language is ambiguous if it is susceptible to more than one reasonable interpretation. Folkman v. Quamme, 2003 WI 116, ¶ 13, 264 Wis. 2d 617, 665 N.W.2d 857. "If terms in an insurance policy are ambiguous, they should be construed against the insurance company that drafted the policy." Frost v. Whitbeck, 2002 WI 129, ¶ 19, 257 Wis. 2d 80, 654 N.W.2d 225. Thus, ambiguous terms are to be construed in favor of coverage. Id.

¶ 7. The American Family homeowner's policy contains the following language:

Property damage means physical damage to or destruction of tangible property, including loss of use of this property. Loss of use of tangible property does not include any resulting loss of value of such damaged property.
We will pay, up to our limit, compensatory damages for which any insured is legally liable because of bodily injury or property damage caused by an occurrence covered by this policy.

¶ 8. The question here is whether the fire suppression costs that were incurred by the State and for which Gouwens is liable are "compensatory damages ... because of. . . property damage caused by an occurrence covered by this policy." We conclude that this language is ambiguous as applied to the fire suppression costs in this case because there are two competing reasonable interpretations of the policy language.

¶ 9. The State proffers one reasonable interpretation. Under this interpretation, the suppression costs are "damages for which [Gouwens] is legally liable because of. . . property damage." Under this view, the ongoing fire damage necessitated and, therefore, caused the State's fire suppression activity.

¶ 10. American Family presents an alternative reasonable interpretation. American Family starts by pointing out that the policy defines "property damage" as "physical damage to or destruction of tangible property." According to American Family, the "property damage" in this case is limited to the damage caused by the fire, and does not include the damage-causing agent. That is, "physical damage to or destruction of tangible property" does not refer to the fire itself. Under American Family's interpretation, the fire suppression costs were therefore not incurred "because of.. . property damage" caused by the fire, but instead because of the fire itself.

¶ 11. American Family argues, in effect, that the State's interpretation is unreasonable because it depends on an unreasonably broad definition of "because of." In American Family's view, "because of' must more narrowly mean "caused by." Thus, under American Family's interpretation of the policy, the "property damage" (i.e., burned material) did not cause the "compensatory damages" (i.e., the fire suppression costs). We conclude, however, that "because of' can reasonably be read as having the broader meaning advanced by the State.

¶ 12. Moreover, it is apparent that the insurance policy drafter knew how to utilize the narrower concept of "caused by" when he or she wanted to. The provision at issue in this case reads in full: "We will pay, up to our limit, compensatory damages for which any insured is legally liable because of bodily injury or property damage caused by an occurrence covered by this policy." (Italics added.) If the terms were synonymous, there would be no reason to use these different terms in the same policy sentence. Cf. Dieter v. Chrysler Corp., 2000 WI 45, ¶ 16, 234 Wis. 2d 670, 610 N.W.2d 832 (quoting a warranty that includes the "costs of any repairs or adjustments that might be caused by or needed because of certain actions (emphasis altered)).

¶ 13. Although we do not rely on the reasonable expectations of the insured here, we observe that the State's interpretation of the policy is consistent with an insured's reasonable expectations. As a California court observed:

When an insured takes out an indemnity policy, as in this case, it is more reasonable to suppose that he expects to be protected by his insurance in any situation wherein he becomes liable for damage to tangible property. It would seem strangely incongruous to him, as it does to us, that his policy would cover him for damages to tangible property destroyed through his negligence in allowing a fire to escape but not for the sums incurred in mitigating such damages by suppressing the fire.

Globe Indent. Co. v. People, 118 Cal. Rptr. 75, 79 (Ct. App. 1974).

¶ 14. Having determined that there is more than one reasonable interpretation of the policy, we conclude that the applicable terms of the policy are ambiguous and must be construed against the insurer and in favor of coverage. See Frost, 257 Wis. 2d 80, ¶ 19. Accordingly, coverage exists under Gouwens' policy for the State's fire suppression costs.

¶ 15. Because we affirm the circuit court's coverage determination and because the circuit court's order dated July 16, 2003, entered pursuant to the parties' stipulation, contains directions as to what must occur with respect to payment, remand is unnecessary.

By the Court. — Order affirmed.

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

       After American Family filed its appeal, we requested memoranda from the parties on whether a stipulation and order that precludes further proceedings in the circuit court falls outside the ambit of Cascade Mountain, Inc. v. Capitol Indemnity Corp., 212 Wis. 2d 265, 569 N.W.2d 45 (Ct. App. 1997), and is appealable as a matter of right. Upon review of the parties' responses to our request, we concluded in a November 3, 2003 order that the circuit court's order incorporating the parties' stipulation was final and appealable as a matter of right.

       Courts in other jurisdictions construing the same or similar policy language agree with the State's interpretation. See A.Y. McDonald Indus., Inc. v. Insurance Co. of N. Am., 475 N.W.2d 607, 623, 624 (Iowa 1991) ("damages" in a general liability policy includes costs of measures taken to prevent or halt damages); see also Globe Indent. Co. v. People, 118 Cal. Rptr. 75, 77, 79-80 (Ct. App. 1974); American Econ. Ins. Co. v. Commons, 552 P.2d 612, 613 (Or. Ct. App. 1976).

       As an additional argument, American Family asserts that Wis. Stat. § 26.14(9) controls the definitions of "compensatory damages" and "property damage" in the policy. However, American Family offers no persuasive reason for us to conclude that the legislature intended § 26.14(9) to regulate or otherwise affect the definition of damages in homeowners' insurance policies such as the one we examine here.

       A recent supreme court decision appears to endorse an approach in which courts consider the reasonable expectations of the insured in determining whether policy language is ambiguous. See State Farm Mut. Auto. Ins. Co. v. Langridge, 2004 WI 113, ¶¶ 46-49, 54, 275 Wis. 2d 35, 683 N.W.2d 75.


author: SNYDER, J.

text:
    Debra L. Kontowicz, Keith A. Kontowicz, and Scott Kontowicz and Katie Kontowicz, by their Guardian ad Litem, William Cannon, Plaintiffs-Respondents, American Family Mutual Insurance Co., Involuntary-Plaintiff, v. American Standard Insurance Co. of Wisconsin, Defendant-Appellant, ABC Insurance Co., Defendant. [Case No. 03-2177.] Larry Buyatt, Plaintiff-Respondent,† American Family Mutual Insurance Company, Involuntary-Plaintiff, v. Metropolitan Property and Casualty Insurance Company and Jason E. Schoessow, Defendants-Appellants. [Case No. 03-2534.]
    Court of Appeals

      Nos. 03-2177, 03-2534.

      Oral argument November 30, 2004.

      Decided January 19, 2005.

    2005 WI App 22
    (Also reported in 693 N.W.2d 112.)

      On behalf of the defendant-appellant American Standard Insurance Co. of Wisconsin, the cause was submitted on the briefs of James C. Ratzel of Ratzel & Associates, LLC, Brookfield, and Colleen D. Ball of Appellate Counsel, S.C., Wauwatosa. There was oral argument by James C. Ratzel.

    On behalf of the defendants-appellants Metropolitan Property and Casualty Insurance Company and Jason E. Schoessow, the cause was submitted on the briefs of Donald H. Piper and Patrick A. O'Neil of Piper & Schmidt, Milwaukee. There was oral argument by Donald H. Piper.

    On behalf of the plaintiffs-respondents Debra L. Kontowicz, Keith A. Kontowicz, and Scott Kontowicz and Katie Kontowicz, by their guardian ad litem, William Cannon, the cause was submitted on the brief of William M. Cannon and Edward E. Robinson of Cannon & Dunphy, S.C., Brookfield. There was oral argument by Edward E. Robinson.

    On behalf of the plaintiff-respondent Larry Buyatt, the cause was submitted on the brief of James J. Gende II and Charles David Schmidt of Cannon & Dunphy, S.C., Brookfield. There was oral argument by Edward E. Robinson.

    A nonparty brief was filed by Todd G. Smith of LaFollette, Godfrey & Kahn, Madison, for Civil Trial Counsel of Wisconsin and the Wisconsin Insurance Alliance.
    A nonparty brief was filed by Keith R. Clifford and Teague D. Devitt of Clifford & Raihala, S.C., Madison, for the Wisconsin Academy of Trial Lawyers.
    Before Brown, Nettesheim and Snyder, JJ.

       Petition to review granted 4-6-2005.

   SNYDER, J.

¶ 1. This appeal arises from judgments awarding interest pursuant to Wis. Stat. § 628.46 (2001-02), which incorporates by reference Wis. Stat. § 646.31(2). The lead issues concerning the construction of § 628.46 in conjunction with § 646.31(2)(d) are common to both cases and the respondents in both cases are represented by the same law firm. By order dated December 6, 2004, the cases were consolidated for purposes of this opinion.

¶ 2. The plaintiffs in each case brought personal injury claims against the corresponding defendants and their insurers. Debra L. Kontowicz and Larry Buyatt were compensated for their injuries, one through negotiated settlement and the other as the result of a jury trial. Both plaintiffs sought interest pursuant to Wis. Stat. § 628.46, alleging that the insurance company had not made payment on the claims in a timely manner. The identical issue raised in each case is whether the § 628.46 interest penalty, by reference to Wis. Stat. § 646.31(2)(d), applies to a third-party personal injury claim against a liability insurance policy. American Standard Insurance Co. of Wisconsin and Metropolitan Property and Casualty Insurance Company contend that the circuit courts erred when they determined that the interest did apply to third-party personal injury claims. We agree and reverse the judgments insofar as they award interest to the plaintiffs under § 628.46. American Standard and Metropolitan raise additional issues on appeal; however, our determination that § 628.46 interest does not extend to a third-party claim resolves the remaining issues.

BACKGROUND

¶ 3. The facts before us are not in dispute. Kon-towicz and American Standard stipulated to the material facts underlying the settlement of her claim. On August 30, 2000, Kontowicz was rendered a quadriplegic in an automobile accident wherein Daniel Jeffers, a sixteen-year-old driver insured by American Standard, hit Kontowicz's vehicle from behind. Kontowicz's vehicle went off the road and struck a utility pole. She was taken to the hospital by Flight for Life. At the time of the accident, Jeffers was covered by an American Standard insurance policy with a $500,000 per person liability limit.

¶ 4. Kontowicz sued Jeffers and American Standard. The parties reached a settlement, agreeing that American Standard would pay its policy limit and that Jeffers would pay approximately $78,000 in exchange for a release and dismissal. The parties reserved the issue of whether Wis. Stat. § 628.46 interest would he awarded, agreeing to request a declaratory judgment from the court. The circuit court awarded the interest to Kontowicz, and American Standard appeals.

¶ 5. In the companion case, Buyatt was injured in an automobile accident caused by Jason E. Schoessow on June 21, 1999. At the time of the accident, Schoes-sow was covered by a Metropolitan liability insurance policy. Buyatt sued Schoessow and Metropolitan for damages arising from the accident. Following a trial, the jury returned a verdict in favor of Buyatt and awarded him a total of $24,081. Following the verdict, Buyatt moved the circuit court for Wis. Stat. § 628.46 interest and the court granted Buyatt's motion. The court entered judgment against Metropolitan, incorporating the jury award, costs, and statutory interest. Metropolitan paid the undisputed portion of the judgment and appeals that portion associated with § 628.46 interest.

DISCUSSION

Standard of Review

¶ 6. The issue presented for review is whether the circuit courts were correct in applying the Wis. Stat. § 628.46 interest penalty to third-party claims for personal injury. Review of a circuit court's interpretation of a statute is a question of law that this court reviews de novo. State v. Setagord, 211 Wis. 2d 397, 405-06, 565 N.W.2d 506 (1997). "When interpreting a statute, our purpose is to discern legislative intent. To this end, we look first to the language of the statute as the best indication of legislative intent. Additionally, we may examine the statute's context and history." Village of Lannon v. Wood-Land Contractors, Inc., 2003 WI 150, ¶ 13,267 Wis. 2d 158, 672 N.W.2d 275 (citations omitted). When interpreting a statute, we presume that "the legislature intends for a statute to be interpreted in a manner that advances the purposes of the statute." State v. Carey, 2004 WI App 83, ¶ 8, 272 Wis. 2d 697, 679 N.W.2d 910 (citation omitted), review denied, 2004 WI 114, 273 Wis. 2d 657, 684 N.W.2d 138 (Nos. 03-1578-CR to 03-1583-CR). We will reject a literal reading of a statute that would lead to an absurd or unreasonable result that does not reflect the legislature's intent. State v. Jennings, 2003 WI 10, ¶ 11, 259 Wis. 2d 523, 657 N.W.2d 393.

Plain Language of the Relevant Statutes

¶ 7. Our first task is to look at the plain language of the statutes implicated in this appeal. Wisconsin Stat. § 628.46 states in relevant part:

Timely payment of claims. (1) Unless otherwise provided by law, an insurer shall promptly pay every insurance claim. A claim shall be overdue if not paid within 30 days after the insurer is furnished written notice of the fact of a covered loss and of the amount of the loss. If such written notice is not furnished to the insurer as to the entire claim, any partial amount supported by written notice is overdue if not paid within 30 days after such written notice is furnished to the insurer. Any part or all of the remainder of the claim that is subsequently supported by written notice is overdue if not paid within 30 days after written notice is furnished to the insurer. Any .payment shall not be deemed overdue when the insurer has reasonable proof to establish that the insurer is not responsible for the payment, notwithstanding that written notice has been furnished to the insurer .... All overdue payments shall bear simple interest at the rate of 12% per year.
(2) Notwithstanding sub. (1), the payment of a claim shall not be overdue until 30 days after the insurer receives the proof of loss required under the policy or equivalent evidence of such loss. The payment of a claim shall not be overdue during any period in which the insurer is unable to pay such claim because there is no recipient who is legally able to give a valid release for such payment, or in which the insurer is unable to determine who is entitled to receive such payment, if the insurer has promptly notified the claimant of such inability and has offered in good faith to promptly pay said claim upon determination of who is entitled to receive such payment.
(3) This section applies only to the classes of claims enumerated in s. 646.31(2).

Section 628.46(3) refers us to Wis. Stat. § 646.31(2) to determine which claims are eligible for the interest penalty. Section 646.31(2)(d) states as follows:

(2) Classes of Claims to be paid. No claim may be paid under this chapter unless the claim is in one of the following classes:
(d) Third party claimants. A claim under a Lability or workers' compensation insurance policy, if either the insured or the 3rd party claimant was a resident of this state at the time of the insured event.

¶ 8. Kontowicz and Buyatt assert that the statutes are unambiguous. They note that the opening sentence of Wis. Stat. § 628.46 states that "an insurer shall promptly pay every insurance claim" and contend that the legislature clearly included third-party claims. Further, they argue that § 628.46(3) plainly states that it applies only to classes of claims enumerated in Wis. Stat. § 646.31(2), which includes third-party claimants who are Wisconsin residents under § 646.31(2)(d). We agree that this interpretation of the plain language of § 628.46, in conjunction with § 646.31(2)(d), is a reasonable one.

¶ 9. American Standard and Metropolitan insist that the Wis. Stat. § 628.46 use of terms such as "insurance claim," "claim . .. under the policy," "proof of loss" and "covered loss" historically relate to first-party claims. They direct us to the standard fire insurance policy annexed to Wis. Stat. § 203.01(1) (1973). This standard policy contains language and concepts also contained in § 628.46. They further point out that § 628.46 appears in a chapter entitled "Insurance Marketing," clearly a reference to the first-party relationship. Finally, they note that § 628.46(2) applies to claims "under the policy," which are distinguishable from claims by third parties "against the policy." For support, they refer us to Wis. Stat. § 645.68(3m), where the legislature describes certain claims as "[c]laims against the insurer that are not under policies and that are for liability for bodily injury or for injury to or destruction of tangible property." (Emphasis added.) We are persuaded that this first-party focus presents another reasonable interpretation of § 628.46. .

¶ 10. We conclude that because there are two incompatible, yet reasonable, interpretations of Wis. Stat. § 628.46, the statute is ambiguous. See State ex rel. Angela M.W. v. Kruzicki, 209 Wis. 2d 112, 122, 561 N.W.2d 729 (1997). We turn to the historical context of the statute in our quest to discern the legislative intent. See Village of Lannon, 267 Wis. 2d 158, ¶ 13.

Analysis of Wis. Stat. § 628.46

¶ 11. Kontowicz and Buyatt maintain that Wisconsin jurisprudence has consistently supported the right of third parties to be treated fairly and equitably by insurers. This guiding principle, they contend, leads to only one reasonable conclusion: the legislature intended third parties to benefit from the interest penalty set forth in Wis. Stat. § 628.46. American Standard and Metropolitan respond that in construing § 628.46 we must keep to the legislature's purpose in creating the interest penalty, which is to reinforce the duty of good faith owed by the insurer to the insured. Neither the appellants nor the respondents point to any Wisconsin case law addressing the application of § 628.46 interest to third-party bodily injury or personal injury claims. Further, authority from other jurisdictions lends little assistance.

¶ 12. Kontowicz and Buyatt ask us to consider the greater context of the insurance code. Wisconsin Stat. § 601.01(2) provides that the purposes of Wis. Stat. chs. 600 to 655 are "[t]o ensure that policyholders, claimants and insurers are treated fairly and equitably" and Wis. Stat. § 600.12(1) instructs us to liberally construe the insurance code. Kontowicz and Buyatt argue that policyholders are by definition first-party claimants; therefore, the § 601.01(2) reference to "policyholders, claimants and insurers" cannot be narrowly construed to mean first-party claimants without rendering the term "claimants" superfluous. See State v. Achterberg, 201 Wis. 2d 291, 299, 548 N.W.2d 515 (1996) (statutory construction that renders a word or phrase superfluous must be avoided). The natural conclusion, they contend, is that the legislature created the interest penalty to encourage insurers to treat both first-party and third-party claimants fairly and equitably. Our supreme court has addressed this statutory language, holding as follows:

It is readily apparent that [Wis. Stat. § 601.01(2)] does not by express language confer upon any group a right of action. Indeed, it does not by its terms impose a duty, the breach of which could be actionable. No one would argue that fair and equitable treatment of insurers, insureds, and claimants is [not] a desirable goal and one which is worthy of expression in this type of legislation. However, when this stated purpose is viewed with the others in the section, it is clear that the overriding goal of these statutes is to provide the benefits to the general public welfare which flow from a well-regulated insurance industry.

Kranzush v. Badger State Mut. Cas. Co., 103 Wis. 2d 56, 76, 307 N.W.2d 256 (1981).

¶ 13. American Standard and Metropolitan direct us to the genesis of the statute, which first emerged during the 1975 legislative session as "Timely payment of claims" under Wis. Stat. § 631.02. Later that session, the legislature created Wis. Stat. ch. 636 (1975), entitled "Claims Adjustment," and continued § 631.02, "Timely payment of claims," as the newly created Wis. Stat. § 636.10(1) (1975).

¶ 14. Interestingly, and nearly contemporaneously, the Wisconsin courts were grappling with another issue related to fair claims practices, specifically, whether an insured could state a claim for the tort of bad faith against the insurer. See, e.g., Drake v. Milwaukee Mut. Ins. Co., 70 Wis. 2d 977, 983, 236 N.W.2d 204 (1975) (implicitly recognizing insured's claim for insurer's bad faith refusal to honor claim); Anderson v. Continental Ins. Co., 85 Wis. 2d 675, 680, 271 N.W.2d 368 (1978) (an insured may bring a tort action against an insurer for the bad faith refusal to honor a claim of the insured). In Anderson, our supreme court shed some light on the purpose of the interest penalty, at that time known as Wis. Stat. § 636.10 (1975), and its relationship to the tort of bad faith.

As stated above, the tort of bad faith is not for the breach of a contract. It is a separate tort. Sec. 636.10 is merely an additional provision of the insurance contract incorporated into it by operation of law. It is unrelated to the tort of bad faith. In the event of late payment, augmented interest would be due under the statute although no bad faith was attributable to the insurance company.

Anderson, 85 Wis. 2d at 696. The court placed the interest penalty squarely within the contractual relationship by operation of law.

¶ 15. Our supreme court has also provided guidance on the relationship between an insurer and a third party whose claim lies in tort:

The insurer's duty of good faith and fair dealing arises from the insurance contract and runs to the insured. No such duty can be implied in favor of the [third party] claimant from the contract since the claimant is a stranger to the contract and to the fiduciary relationship it signifies. Nor can a claimant reasonably expect there to be such a duty....

Kranzush, 103 Wis. 2d at 73. Although the Kranzush court addressed the issue of whether to extend an insurer's duty of good faith and fair dealing to third-party liability claims rather than the interest penalty issue presented here, we find the analysis sufficiently analogous and look to the court's reasoning for guidance.

¶ 16. Kranzush instructs that the insurer's duty of good faith and fair dealing, which arises from the fiduciary relationship, exists "whether the company is attending to the claims of third persons against the insured or the claims of the insured itself." Id. at 62 (citation omitted). Here, although the third party may benefit from the onus placed on the insurer, the protection of the policyholder is again paramount. Our supreme court rejected Kranzush's proposition that insurers should be liable "to a third-party claimant for the insurer's failure to settle the claim where the liability of the insured is reasonably clear." Id. at 62-63. The supreme court explained that settlement of third-party claims may give rise to the tort of bad faith only in the sense that the tort action is "a vehicle to enforce the insurer's duty to be mindful of the insured's interests when settling third-party claims." Id. at 63. The Kran-zush court looked extensively at other court decisions and identified the following theme: "an insurer owes no duty to the third-party claimant to settle or to negotiate in good faith." Id. at 72.

¶ 17. Kontowicz and Buyatt argue that reliance on Kranzush is misplaced because our supreme court has clearly stated that the interest penalty is unrelated to the issue of bad faith. See id. at 76. However, we discern in the case law of that period a focus on the fiduciary relationship between insurer and insured, and the goal of protecting the rights of the insured. This then is the historical context for development of the interest penalty under Wis. Stat. § 628.46. We conclude that § 628.46 arose from the legislature's intent to protect the insured from improper claims settlement practices.

¶ 18. Kontowicz and Buyatt contend that the Wis. Stat. § 628.46(3) reference to Wis. Stat. § 646.31(2) supports them. At the time that Wis. Stat. § 636.10(3) (1975) was created, it read, "This section applies only to the classes of claims enumerated in s. 646.11(2)." The relevant portion of Wis. Stat. § 646.11(2) (1975) stated that the classes of claims to be paid included:

(c) Third party claimants. A claim under a liability o[r] worker's compensation insurance policy, if:
1.Either the insured or the 3rd party claimant was a resident of this state at the time of the insured event; or
2. The claim is for bodily injury or personal injuries suffered in this state or by a person who when he [or she] suffered the injuries was a resident of this state; or
3. The claim is for damage to property situated in this state at the time of damage.

Sec. 646.11(2)(c) (1975). However, we are persuaded that the legislature has made its intent clear by withdrawing all references to bodily injury or personal injury from the statute. The current language states that eligible claims include a "claim under a liability or workers' compensation insurance policy, if either the insured or the 3rd party claimant was a resident of this state at the time of the insured event." Sec. 646.31(2)(d). Kontowicz and Buyatt assert that the current language continues to include third-party bodily injury or personal injury claims by its reference to liability policies and third-party claimants. We disagree. By eliminating the bodily injury and personal injury language from the statute, the legislature has preserved eligibility for a more narrow group, specifically: (1) third parties whose claims arise under the policy in the same manner and under the same provisions as the named insured, and (2) third-party worker's compensation claimants.

¶ 19. Under Wis. Stat. § 632.32(3)(a), an automobile insurance policy must provide coverage "to any person using any motor vehicle described in the policy when the use is for purposes and in the manner described in the policy." Furthermore, a policy may not exclude coverage for "[pjersons related by blood, marriage or adoption to the insured" or a "passenger in or on the insured vehicle." Sec. 632.32(6)(b)l. and 2.a. Consequently, the insured has paid premiums with the expectation that these third parties will be covered under the policy and the insurer has set premiums and issued coverage accordingly.

¶ 20. Courts have also extended protections to third-party claimants in worker's compensation cases. The rationale behind the worker's compensation system is that workers accept smaller recoveries in return for coverage regardless of fault; by contrast, a third-party tort victim "is not the object of a sweeping statutory scheme designed to promote the compensation of injuries in a routine, largely nonadversarial manner." See Kranzush, 103 Wis. 2d at 65. The legislature's extension of the Wis. Stat. § 628.46 interest penalty to third-party worker's compensation claimants is consistent with the special relationship created between claimant and insurer under the worker's compensation statutes.

¶ 21. The legislature's elimination of the bodily injury or personal injury claimant from eligibility under Wis. Stat. § 646.31(2)(d) in 1999 is noteworthy for its timing. In the case of Leister v. General Casualty Insurance Co., Dane County Circuit Court Case No. 98-CV-3182, a circuit court took up the issue for the first time. Calling Leister's request for Wis. Stat. § 628.46 interest a "novel claim," the circuit court ruled that the statute allowed third-party claimants such as Leister to claim the interest. Leister, No. 98-CV-3182 (Memorandum Decision and Order on Motion to Dismiss, at 1). Shortly thereafter, another circuit court issued a similar ruling in Coker v. American Family Mutual Insurance Co., Dane County Circuit Court Case No. 99-CV-2949 (Decision and Order). Just as this novel issue was emerging in the trial courts, the legislature acted to eliminate the personal injury and bodily injury language from the statute.

¶ 22. Finally, Kontowicz and Buyatt argue that we should adopt their interpretation of Wis. Stat. § 628.46 on public policy grounds. They point out that it is a fundamental public policy of this state to encourage the settlement of insurance claims, see Bersch v. Van-Kleeck, 112 Wis. 2d 594, 598, 334 N.W.2d 114 (1983), and that § 628.46 is the "statutory embodiment" of the policy against dilatory tactics by insurers.

¶ 23. The practical effect of this interpretation, however, is to create a conflict of interest for the insurer. As previously established, the insurer owes a duty of good faith and fair dealing to its insured. The policyholder pays premiums as. consideration for not only coverage, but also the insurer's duty to defend. See Elliott v. Donahue, 169 Wis. 2d 310, 321, 485 N.W.2d 403 (1992) ("Indemnification and defense for claims falling within the parameters of the insurance policy are the two primary benefits received by the insured from a contract of insurance. The nature of the insurance contract... contemplated] that indemnification and defense is provided to the insured in exchange for the insured's premium payments."). Were we to interpret Wis. Stat. § 628.46 to include third-party tort actions, we would undermine the purpose of the insurance contract and the duties of the insurer. We conclude that our legislature did not intend to compromise the insurer's duty to its insured in such a manner. See Jennings, 259 Wis. 2d 523, ¶ 11 (we will reject an interpretation that would lead to an absurd or unreasonable result and that does not reflect the legislature's intent). Restricting the § 628.46 interest penalty to a first-party context, with narrow third-party application, promotes the legislature's intent to protect policyholders from dilatory tactics by insurers. Further, this comports with the legal distinctions drawn by our courts to clarify an insurer's duty of good faith and fair dealing concerning first-party claims in contrast to third-party tort claims.

CONCLUSION

¶ 24. We conclude that Wis. Stat. § 628.46 is ambiguous when raised in a third-party bodily injury or personal injury context. We further conclude that the legislature intended the § 628.46 interest penalty to protect the insured from unfair and dilatory claims practices. We further conclude that Wis. Stat. § 646.31(2)(d) broadens the application of § 628.46 to worker's compensation claimants and that narrow class of third parties whose claims arise in the same manner and under the same provisions as the insured. We reverse the judgments insofar as they award interest to the plaintiffs under § 628.46 and remand with directions for each respective circuit court to enter an amended judgment in accordance with this decision.

By the Court. — Judgments reversed and causes remanded with directions.

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

       The standard fire insurance policy references "proof of loss" and "written notice" and states that amounts "shall be payable sixty days after proof of loss ... is received." See Wis. Stat. § 203.01(1) (1973) (standard policy lines 74-5, 90-1, and 150-53).

       Our research demonstrates that while several states have statutes addressing timely payment of claims, many exist as part of the state's no-fault automobile insurance system and, consequently, are of little guidance. Other statutes requiring timely payment of claims were not sufficiently similar to Wis. Stat. § 628.46, and, therefore, the corresponding case law does not inform our decision here.

        See 1975 Wis. Laws, ch. 39, § 708.

        See 1975 Wis. Laws, ch. 375, § 43. In addition, the legislature added Wis. Stat. § 636.10(2) and (3) (1975), which correspond to today's Wis. Stat. § 628.46(2) and (3).

       In 1999, our legislature repealed subdivisions 2. and 3., which specifically referenced claims for bodily injury or personal injuries and third-party claims for property damage. See 1999 Wis. Act 30, §§ 73-76. Even if the legislature had originally intended to apply the interest penalty to third-party bodily injury or personal injury claims, the 1999 enactment makes it clear that the legislature no longer intends to include such claims. See Verdoljak v. Mosinee Paper Corp., 200 Wis. 2d 624, 633, 547 N.W.2d 602 (1996) (the legislature's omission of a phrase indicates an intent to alter statutory meaning; when a statute is repealed and recreated on the same subject, any change in language is presumed to be the result of the legislature's conscious deliberation).

        See 1999 Wis. Act 30, §§ 73-76.