860 N.W.2d 515
Wis. Ct. App.2015Background
- In July 2006 Johnson (passenger/owner) and Crandall (driver) were involved in a drunk‑driving crash; both were intoxicated and Johnson was insured by his employer Cintas Corp. No. 2 (Cintas 2) which covered permissive drivers.
- Johnson served suit (2007) and filed a statutory offer of settlement in May 2008 for $300,000; procedural defects in service produced interim default‑judgment proceedings and remand.
- Case proceeded to jury trial in April 2013; jury awarded $412,372 but found Johnson 20% contributorily negligent, reducing recovery to $329,897.60.
- Johnson sought interest from the date of his 2008 offer at 12% (rate in effect then). The legislature had reduced the § 807.01(4) rate in 2011 to 1% over prime; the trial court applied the lower, post‑2011 rate.
- Cintas 2 appealed (arguing faulty jury instructions and prejudicial reference to a criminal charge); Johnson cross‑appealed the interest‑rate issue. The court affirmed on evidentiary and instruction points but reversed on the interest‑rate issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 2011 amendment to Wis. Stat. § 807.01(4) (lowering the interest rate) applies to offers made before the amendment | Johnson: Rate is fixed by statute when the offer is filed; filing vests a substantive right to the stated rate (12%) and interest runs from date of offer | Cintas 2: No vested right until judgment is recovered; the statute applies to judgments entered/executed after the amendment, so the new (lower) rate governs | The 2011 amendment may not be applied retroactively to offers filed before its effective date; the 12% rate in effect when the offer was filed governs (retroactive reduction would unconstitutionally impair vested rights) |
| Whether the trial court erred by refusing to give a negligent‑entrustment instruction and separate verdict interrogatories distinguishing "active" (entrustment) and "passive" (riding) contributory negligence | Cintas 2: Jury should separately assess negligent entrustment (giving keys) and voluntary riding while intoxicated | Johnson: General negligence/contributory‑negligence instructions covering duty to exercise ordinary care suffice | Court: Negligent entrustment is a theory aimed at third‑party victims, not self‑inflicted injury; the general instructions and verdict form fairly and correctly presented the contributory‑negligence issue; no reversible error |
| Whether an unanswered question suggesting Crandall had a criminal charge required a new trial | Cintas 2: The question (though unanswered) injected prejudicial and irrelevant impeachment material that could inflame the jury | Johnson: Question was not answered; standard jury instructions told jurors not to draw inferences from unanswered questions | Court: Unanswered question did not introduce evidence; jury was properly instructed not to infer from objections/unanswered questions; no new trial warranted |
Key Cases Cited
- Upthegrove Hardware, Inc. v. Pennsylvania Lumbermans Ins. Co., 152 Wis.2d 7 (Ct. App. 1989) (treats § 807.01(4) interest as compensatory for use of money during litigation)
- S.A. Healy Co. v. Milwaukee Metro. Sewerage Dist., 60 F.3d 305 (7th Cir. 1995) (§ 807.01(4) interest serves as a sanction and settlement incentive)
- Matthies v. Positive Safety Mfg. Co., 244 Wis.2d 720 (Wis. 2001) (retroactive legislation that impairs vested rights is subject to constitutional scrutiny)
- Martin v. Richards, 192 Wis.2d 156 (Wis. 1995) (invalidating retroactive application of damage caps where vested rights were impaired)
- Neiman v. American Nat'l Prop. & Cas. Co., 236 Wis.2d 411 (Wis. 2000) (rejecting retroactive increase in wrongful‑death limits where private interests were substantially impaired)
- Stehlik v. Rhoads, 253 Wis.2d 477 (Wis. 2002) (explaining negligent entrustment doctrine and its application)
- Peplinski v. Fobe's Roofing, Inc., 193 Wis.2d 6 (Wis. 1995) (jury instruction error warrants reversal only if it probably misled the jury)
- Stuart v. Weisflog's Showroom Gallery, Inc., 308 Wis.2d 103 (Wis. 2008) (special verdict form must cover all material ultimate issues but courts have discretion on form)