917 N.W.2d 37
Wis. Ct. App.2018Background
- Foreclosure/partition dispute over a residence and ~81 acres; 2013 sale of ~76 acres generated $183,091.29 placed into counsel trust accounts pending resolution.
- Parties (Arline Brogli and Kathryn Brogli) agreed to refer equitable-division issues to a court-appointed referee (Douglas Mann) under Wis. Stat. § 805.06; referee authorized to make findings and recommend division.
- Referee filed an initial report valuing the residence/five acres at $100,000 and recommending a 97%/3% split in favor of Kathryn based on contributions; the referee later filed an amended report applying that 97/3 split to the $183,091.29 sale proceeds after receiving an ex parte email from Kathryn.
- Arline timely objected in writing to the amended report, asserting she was not timely notified of the ex parte contact and that the trust funds should not have been reallocated; a bankruptcy stay briefly interrupted proceedings but was lifted.
- At a January 2016 status hearing the court initially recommitted the matter to the referee for supplementation, but then sua sponte adopted the referee’s amended report (97/3 split) without reviewing the referee’s transcript/evidence or addressing Arline’s objection; court later entered final order adopting the amended report. Arline appealed.
Issues
| Issue | Plaintiff's Argument (Brogli) | Defendant's Argument (Kathryn) | Held |
|---|---|---|---|
| Whether the circuit court erred by adopting the referee’s amended report without addressing Arline’s written objection | Arline argued the court adopted the amended report without holding an evidentiary hearing or reviewing the referee’s transcript/evidence, denying her statutory and due‑process protections | Kathryn argued no further hearing was required, the court was familiar with facts from a related divorce, and Arline’s objection was not properly preserved | Reversed: court erred. The circuit court adopted the report without considering Arline’s objection or reviewing the evidence considered by the referee, so it could not determine whether findings were clearly erroneous as required by statute |
| Whether Arline’s written August 11 objection was timely and sufficient to place the court and parties on notice | Arline contended her August 11 letter timely objected to the application of the 97/3 split to the trust proceeds and sought reinstatement of the original report | Kathryn contended Arline failed to comply with statutory objection procedure and/or forfeited issues by not developing them below | Court held Arline’s August 11 objection was timely and put the court and parties on notice; not forfeited |
| Whether the court may adopt a referee’s factual findings without reviewing the referee’s transcript/evidence | Arline asserted statutory scheme requires the referee’s transcript/evidence be filed so court can determine whether factual findings are clearly erroneous | Kathryn suggested statutory and practical considerations can obviate requiring the full transcript and that any error was harmless | Court held that, absent review of the evidence considered by the referee, the court cannot determine whether findings are clearly erroneous; adoption without that review was an erroneous exercise of discretion |
| Whether the failure to include the referee’s transcript/evidence was harmless | Arline argued prejudice from lack of opportunity to contest allocation of trust funds | Kathryn claimed any error was harmless because report was well‑reasoned and outcome would be the same | Court found the record inadequate to conclude harmlessness and remanded for further proceedings |
Key Cases Cited
- Kleinstick v. Daleiden, 71 Wis.2d 432 (1976) (referee findings are to be treated as circuit court findings and upheld unless against great weight and clear preponderance of the evidence)
- Piaskoski & Assocs. v. Ricciardi, 275 Wis.2d 650 (2004) (absence of an exercise of discretion constitutes an erroneous exercise of discretion)
- Riley v. Extendicare Health Facilities, Inc., 345 Wis.2d 804 (2013) (appellate review limited when the record is inadequate to resolve factual issues)
- Hastings Realty Corp. v. Texas Co., 28 Wis.2d 305 (1965) (reviewing court cannot resolve questions when pertinent facts are not of record)
- Klawitter v. Klawitter, 240 Wis.2d 685 (2001) (standards for reviewing equitable/partition decisions and for discretionary rulings)
- Estate of Grochowske v. Romey, 340 Wis.2d 611 (2012) (interpretation of referee statutory provisions reviewed de novo)
- State v. Caban, 210 Wis.2d 597 (1997) (issues not raised in circuit court generally not considered on appeal)
- State v. Huebner, 235 Wis.2d 486 (2000) (policy reasons for preserving objections at trial)
- State v. Pettit, 171 Wis.2d 627 (1992) (court will not consider undeveloped arguments)