*1 Plaintiff- S.C., Stevens, Ross & Rеspondent-Cross-Appellant-Petitioner, Racing Galaxy Gaming Partnership, Limited Galaxy Casinos, Inc., Defendants-Co- Appellants-Cross-Respondents-Cross Petitioners, Inc., Defendant- Enterprises, Florida Southwest Appellant-Cross-Respondent-Cross Petitioner.
Supreme Court
8, 2004. Decided
argument April
No. 02-0359. Oral
July
SYKES, joins dissent/concurrence. J.J., part. and took no Prosser, Wilcox For plaintiff-respondent-cross-appellant-peti- and R. Varda by Anthony there were briefs tioner Stevens, S.C., Madison, oral argu- & Ross R. ment Varda. by Anthony
For
defendants-co-appellants-cross-respon-
H.
Robert
there were briefs
petitioners
dents-cross
Farris,
L.
and Frie-
Friebert,
Bolger
Todd
S.
Jennifer
S.C.,
John,
Milwaukee, and oral
bert,
&
Finerty
St.
H. Friebert.
Robert
argument by
This case arises
BRADLEY, J.
1. ANN WALSH
a
of
bill.
legal
over the collection
dispute
out
a
S.C., seeks review
Stevens,
DeWitt Ross &
petitioner,
that af-
appeals
of the court of
a
decision
published
in
рart
judgment
and reversed
firmed in part
of appeals
the court
circuit court.1 DeWitt asserts
1
190, 2d
App
Galaxy Gaming,
WI
Dewitt
reversing
part
part
(affirming
erred in it an award of interest statutes, offer of under settlement Wis. Stat. 807.01(3) 807.01(4).2 § and Cross-petitioners Galaxy Gaming Racing
¶ 2. Galaxy L.E, Casinos, Inc., and Southwest Florida En- terprises, appeals' Inc. also seek review of the of court They ruling decision. assert court erred that 807.01(3) § DeWitt made a valid Stat. offer they Additionally, settlement. contend that the court concluding guaranty erred in that Southwest's on be- Galaxy guarantee pay half of included a to interest due outstanding charge account, on the could DeWitt January 1,1997, interest retroactive to and that DeWitt statutory expense having could recover as costs the videographer reporter a both court record the deposition. same
¶ 3. We conclude that did DeWitt not make a valid 807.01(3) Wis. Stat. offer of settlement.3 alsoWe appeals properly conclude that the court of determined guaranty Galaxy that Southwest's on behalf of included guarantee pay charge interest, that DeWitt could January interest 1,1997, retroactive to and that DeWitt statutory expenses could recover as costs the of both its videographer Accordingly, reporter. and court we affirm part, part, reverse in and remand the cause to the circuit court.
2All references the Wisconsin Statutes are to the 2001-02 version unless otherwise noted. argues statutory percent that the prejudgment 807.01(4) interest mandatory is under Wis. Stat. and that the court of appeals declining erred to stack it on top 18 percent contractual specified in DeWitt's retainer agreement. Because we determine did that DeWitt not make a settlement, valid Wis. Stat. offer of we need not address this issue.
HH *6 years, the law firm of DeWitt 4. For over five (hereinafter "DeWitt") provided Stevens, &Ross S.C. Racing legal Galaxy Gaming to & L.E services (hereinafter collectively Galaxy Casinоs, referred Inc. legal "Galaxy Partnership"). were to The services as Galaxy Partnership's liti- rendered in connection with City gation of Hudson. with the Galaxy Partnership sought approval to ¶ 5. obtain dog track for an Indian casino at the St. Croix Meadows Partnership part Galaxy effort, of in Hudson. As this City governmen- negotiated agreement with the an Galaxy Partnership's application was tal services. While government, awaiting approval federal final from the City government, the indicat- the communicated with ing opposed proposed In the federal it casino. the denying approval government's casino, it decision Galaxy City's opposition as a factor. Partner- cited City's ship opposition a of considered the breach represent agreement it. and retained DeWitt Galaxy president Havenick, of Partner- Fred signed ship, The letter with DeWitt.4 a retainer letter Galaxy Partnership provided on would bill expenses monthly rendered and for services basis monthly statement that the It also indicated incurred. Finally, receipt. payable upon the letter stated would be right charge [d] at that DeWitt "reserve month) (1 per per on all of 18% annum the rate 1/2% days paid after their date." not within statements actually president of was that Fred Havenick We note Galaxy However, Casinos, Galaxy Gaming. Casinos Galaxy not Thus, of Galaxy Gaming. for ease partner of general is the president of reference, to Havenick as opinion will refer this Galaxy Partnership.
n Galaxy Partnership ¶ 7. Because had no assets or earning required payment income, means of letter of either a cash $25,000 retainer in the amount of aor guaranty payment. Galaxy Partnership of chose the option. president Galaxy latter Havenick, the of Part- nership, president was also the Southwest Florida (hereinafter "Southwest"). Enterprises, guar- Inc. anty wholly Southwest, was executed which owned Galaxy general partner Galaxy Gaming Casinos, the (we periodically simрly will refer to all three entities as Companies"). "the capacity president In his Southwest, as signed following guaranty,
Havenick which was page numbered four of the retainer letter and executed *7 simultaneously it: undersigned, for valuable consideration and the
willingness DeWitt, Stevens, of... & Ross S.C. to represent [Galaxy] all Partnership, of which inures to my benefit, hereby guaranties personally timely the payment and full of all for statements services rendered disbursements/expenses incurred on of [Gal- behalf axy] Partnership. In the of a [Galaxy] event failure of Partnership pay monthly to the they statements as fall due, undersigned agrees may, firm[] that law instance, the first undersigned payment look to the having without to exercise any or exhaust remedies against [Galaxy] Partnership. legal provided,
¶ monthly 9. As services were routinely statements were submitted to Havenick. Galaxy Partnership stay However, did not current with payments. By unpaid its 24, November 1997, its bills totaled over $129,000. wrote Havenick, DeWitt de- payment manding Galaxy Partnership's in full of entire obligation by doing 1, December In so, 1997. it alerted timely payment made, DeWitt if were not him percent charge interest on the would contractual balance. Galaxy Shortly Part-
¶ 1,1997, after December payment nership to $50,000 a DeWitt. DeWitt made by sending responded payment Havenick letter to the payment it 8,1997, in which demanded dated December January computed 1, from 1997.5 of retroactive interest object the interest time, Havenick did not to At the payment provision in the letter. Galaxy years, Partner- 11. Over the next two payments
ship to DeWitt. continued to make occasional made, was In those months when indicating summary, payment application provided a applied payments first accrued inter- were object. Again, principal. not Havenick did est, then to final bill to Havenick its 12. DeWitt submitted Galaxy Partnership's litigation with of at the conclusion City. $352,172.59, The bill showed total balance pay- including interest. When $69,209.44 of accrued Companies forthcoming, DeWitt sued ment was not сlaiming guaranty, letter and enforce the retainer through April 1, $396,847.86, which included interest July an offer of DeWitt made 13. On 807.01(3). pursuant The offer settlement to Wis. Stat. required payment to made within $370,000 in full be days acceptance. It stated: *8 Stevens, hereby offers to S.C. DeWitt Ross &
Plaintiff above-captioned all in the and release claims settle sanctions, costs, attorneys matter, including for claims any of the payment to it from fees and interest for 5 1, January why chose It is from the record DeWitt unclear date. rather than some earlier 1997 Defendants, any above-named or combination of the Defendants, $370,000 above-named in the amount of days be made within 15 acceptance of this offer. This date, expire days offer pursuant shall within 10 of this 807.01, to Wis. Stat. and not be will hereinafter renewed. rejected, After 14. the offer was DeWitt moved summary judgment question
for liability on the of Southwest's guaranty principal
under the and interest determined due. The circuit court that Southwest's obligation guaranty under the included percent contractual 18 It interest. also concluded that unpaid DeWitt was entitled to recover interest on the 1, balance from December 1997, date in- DeWitt Companies begin assessing formed the that it would interest. judgment against The 15. circuit court entered Companies awarding in the amount of $407,498.79, 807.01(3). pursuant
double costs to Wis. Stat. Al- though it concluded that the settlement offer valid, was statutory percent court declined stack the prejudgment top interest on contractual 18 percent interest that DeWitt was entitled to receive. transcript The court also declined to award costs for a videotaped deposition. Companies of Havenick's The appealed cross-appealed. and appeals part court of affirmed in part reversed in the decision of the circuit court. DeWitt Galaxy Gaming, App 190, 2003 WI 267 Wis. 2d 670 N.W.2d 74. Like the court, circuit it held that percent Southwest was liable for the contractual 18 interest, costs, DeWitt was entitled to double ¶¶ offer of Id., DeWitt's settlement was valid. discussing In whether Wis. Stat. offer may 15-day payment of settlement сontain condition, *9 appeals Id., a test. court of crafted "reasonableness" of ¶ offer It that a Wis. Stat. 31. determined provided that contain a condition could such settlement Id. it was reasonable. agreed appeals
¶ addition, court of with 17. In that Dewitt could not stack statu- the circuit court tory top percent prejudgment on of its interest percent ¶ Id., The court interest. 63. contractual 18 to of this case determined the effective rate interest percent prevailed. ¶ Id., 56, n. 8. It had be 35.9 prospect of faced concern that when voiced they incurring might interest, offerees believe such capitulate. Id., no to 65. The court have choice but the contract determined that interest under further began January 1, 1, not December to accrue on Finally, Id., the circuit ¶ 4. it concluded that 1997. deposition transcript erroneously as excluded the court of Id. an item costs.
HHHH ap- summary judgment decisions 18. review We methodology plying circuit court. as does the the same Kaczmarczyk, ¶WI25, Lambrecht v. Estate of In to be entitled 804, 623 order 241 Wis. 2d N.W.2d moving prove summary judgment, party must to genuine any to material fact and no issue exists as judgment Id., as a matter law. it is entitled ¶ 24. pur- is valid for settlement offer Whether statutory prejudgment
poses involves inter- 807.01(3). application pretation This of Wis. Stat. subject independent question presents of law appellate Meyer Colby, review. v. Sch. Dist. 226 Wis. *10 (1999). 708, 2d 704, 595 339 N.W.2d reviewing scope guaranty
¶ In 20. aof determining payment when of due, interest is we must interpret presents question a contract. too law, This a of subject independent appellate to review. See N. States App ¶ Power Nat'l Co., 30, Co. v. Gas 2000 7, WI 232 Wis. 2d 613. N.W.2d Finally, stenographic transcript ¶ 21. a whether videotaped deposition necessary of a is a cost that prevailing plaintiff should be awarded to a is a matter uphold within the circuit court's discretion. willWe provided circuit discretion, court's exercise of it that applied proper facts, examined the rеlevant a standard using process, law, and, a demonstrated rational judge arrived at a a conclusion that reasonable could Mgmt. Computer Servs., Ash, reach. Hawkins, Inc. v. (Ct. Baptie Co.,& 312, 330, Wis. 2d 592 N.W.2d279 1998). App.
HHHH presents ¶ 22. This case us with several issues. We validity address first of DeWitt's offer of settlement 807.01(3). questions under Next, Wis. Stat. we turn to pertaining to the due, is, interest whether guaranty guarantee pay a Southwest's included to in- charge terest and whether could interest retro- January Finally, active to we consider whether statutory expense DeWitt could recover as costs having videographer reporter both and a court record deposition. the same begins by examining 23. Our discussion
validity statutory of DeWitt's offer of settlement. The valid that the offer was not because contend Companies a sum of request money (including in addition to a for costs), it a condition requiring contained acceptance.6 within 15 days 807.01, entitled "Settle- Wisconsin Stat. offers," consequences
ment creates certain statutory If litigаnts. negotiations settlement between pretrial 807.01, an offer that conforms to section makes party a more rejected, offer is and the offeror recovers costs be shifted or judgment, may favorable then doubled, be may imposed. and prejudgment set statutory 25. The relevant scheme is forth Stat. subparagraphs. gov- three Wisconsin plaintiff erns offers the defendant allow *11 in the amount the defendant judgment against take It specified. provides: trial, days the joined
After issue is but at least before may plaintiff the a upon the defendant written serve judgment against taken the defen- offer to allow to be sum, therein property, for or or to the effect dant the accepts If the offer specified, plaintiff with costs. the writing, trial before and serves notice thereof offer, plaintiff of the the days receipt within 10 after offer, the may file with of service of notice of proof the judg- enter acceptance, thereupon and the clerk must given, accеptance If is not accordingly. ment notice given be evidence nor mentioned on the offer cannot as judgment accepted is not the the trial. If the offer alternative, that Wis. Stat. Companies In the the maintain they are due unable process § is violative of because 807.01 subject them to given or not a offer will ascertain whether interest. Because we determine prejudgment costs and double a of a deadline that contains condition that a settlement offer specified relief plaintiff not the to the for does entitle 807.01, Companies' due not reach the Stat. we do argument. process
plaintiff fails to recover a more judgment, favorable the plaintiff shall not recover costs but defendant shall recover costs computed to be on the demand of the complaint. 807.01(3) Wisconsin Stat. governs offers of
settlement from the plaintiff to the defendant. It pro- vides: joined
After issue is days trial, but at least 20 before the plaintiff may upon serve the defendant a written offer sum, of settlement for the or property, or to the effect specified, therein with If costs. accepts defendant the offer and serves notice thereof in writing, before trial and days within 10 receipt offer, after may offer, defendant file the proof of service of the notice of acceptance, with the clerk of court. If notice of acceptance given, is not the offer given cannot be as evidence nor mentioned on the trial. If the offer of settlement is not accepted and plaintiff recovers a judgment, more favorable plaintiff shall recover double the amount of the taxable costs. Wisconsin Stat. provides
imposition of prejudgment interest:
If there is an offer of settlement party under this section which accepted is not party and the recovers judgment which greater is equal than or to the amount specified in the offer settlement, party is entitled to interest at the annual rate of 12% on the amount *12 recovered from the date of the offer of settlement until the amount paid. is Interest under this section inis lieu 814.04(4) of interest computed under sections 815.05(8). 28. The statutory ¶ offer of judgment, now num- bered § Wis. Stat. 807.01(1), has been available to Wisconsin defendants since 1858, very little in change its language during the interceding century
590 (Chapter 97, 114 half. 1858 Wis. Laws and a See 1858). governs May published 21, It offers judgment plaintiff to take to allow the defendant against specified. in the amount the defendant 807.01(3), the statute 1971, In Wis. Stat. 29. by Assembly Bill case, was introduced at in this issue drafting request May published indi- 7, 1971.7 52, image mirror of the it created to be a cates that was 807.01(1).8 now numbered Wis. Stat. statute parties required to law, were At common 30. § 807.01 is a Stat. their own costs.9 Wisconsin bear cost-shifting in dero is a statute statute and therefore derogation gation of the of the common law. Statutes strictly e.g., See, construed. common law must be Hoff ¶64, 13, 262 Co.,, 2003 Elec. Power WI mann v. Wis. Bridge v. 55; & Iron Co. 264, Wis. 2d 664 N.W.2d (1940); Comm'n, 467, 474, 290 N.W.199 233 Wis. Indus. (1865). Pierce, 19 Wis. 303 Meek v. Consequently, con courts have Wisconsin strictly. example, very For Nichol
strued the statute strictly Cos., Inc., construed the court v. Home Ins. son joined." "after issue is section, first four words (1987). An offer 581, 606, 405 N.W.2d327 2d 137 Wis. 7 269.02(3). Stat. then numbered Wis. The statute was 8 "Have Assembly Bill LRB Drafting Records of recovers, PI refused, PI & & If made plaintiff offer of settlement. (Reverse days in 10 after Settle t rev double dams. here.)" (Punctuation, (Use subsection titles receipt of offer. original docu in the abbreviation, emphasis as contained ment). 9 Comm'n, Personnel Dep't of Transp. v. Wis. Wisconsin State, (1993) (citing Noyes 731, 736, 500 N.W.2d
Wis. 2d (1879) ("At law, costs the common 250, 251-52,1 1N.W 46 Wis. statute.")). altogether the creature are unknown. Costs were *13 prior
made to the commencement of the action was determined to be invalid. Id. at Likewise, 606-07. an parties stipulated entry offer made after both of a stay in an arbitration was invalid, because it did not place during pendency take of an action and there joined." [was] Briggs fore was not "after issue v. Farm Exchange, App ers Ins. ¶ 40, 17, WI 233 Wis. 2d 163, 607 N.W.2d statutory language 32. The remainder of the similarly strictly
has been
construed. As indicated in
by
statute,
court,
reiteratеd
this
an offer must
Nicholson,
be written.
¶ 34.
we have further circumscribed
They
absolutely
offers of settlement.
must be
unam-
biguous.
Fleming,
Lumber,
Stan's
Inc. v.
196 Wis. 2d
(Ct.
1995).
App.
576,
10
Exchange,
Ins.
164 Wis.
Prosser cites to Testa v. Farmers
(Ct.
1991) ("As
296, 302,
can be seen
App.
2d
other money than component sought some of the relief is other where property. or equivalent of Wis. Stat.
FRCP 68 is the Federal Rules' 807.01(1), from same New York statute and is descended nothing in the lan- note that there is 36. We guage conditions 807.01 that authorizes of Wis. Stat. 15-day payment provision payment here. like the on strictly construing express terms of Therefore, may the condition not be section, we determine that the imposed. is consistent with the 37. This determination provides statutory Wisconsin Stat. scheme. accepted part: "If the offer of settlement is not judgment, plaintiff recovers a more favorable plaintiff the amount of taxable shall recover double forth in the DeWitt costs." The condition set "payment... to be made within offer of settlement was judge days acceptance offer." of this Because *15 ordering payment judgment within 15 could not days, a enter unable to meet the Wis. Stat. is 807.01(3) obtaining § requirement a "more favorable judgment." previously has noted that "the 38. This court § encourage
purpose is to settle- of Wis. Stat. 807.01 just, inexpen- accordingly, speedy and ment and secure disputes." Prosser, 225 2d at sive determinations of expedite 140. As befits a statute intended to the reso- 68, lineage. a from which 807.01 traces its Pursuant to Rule may plaintiff judgment offer to allow a to take defendant "money specified, to the against property it for or or effect encompassing Federal courts have construed the rule as costs." variety judgment injunctive offers for a wide relief. to allow (9th See, EEOC, 438, 442 e.g., Liberty Mut. Ins. Co. v. 691 F.2d 1982) (demand disclosed); that certain information not be Cir. (S.D.Ill. 1985) Walker, Lightfoot Supp. 619 F. 1485-86 (demand reform); specific prison Hanger, health care Mr. Inc., Hangers, Inc. v. Cut Rate Plastic 63 F.R.D. (E.D.N.Y. 1974) (demand infringement). patent for cessation of disputes, language § lution of of Wis. Stat. 807.01 finality proof. reflects concern with and ease of purpose, If 39. Wis. Stat. 807.01 is to fulfill its litigants guidance proper must have clear about the scope help parties of a valid offer. A clear rule will draft potential exposure valid offers and assess their to costs prejudgment expedite and dispute Moreover, interest. it will by minimizing post-
settlement the need for litigation rejected trial about settlement offers. We 807.01(3) further note that Wis. Stat. provide: acceptance given, "If notice of is not the offer given cannot be as evidence nor mentioned on the uniquely appropriate trial. .a clear rule is therefore parties may ruling here because the validity not obtain a on the during of the offer trial. adjudicated
¶ 40. In the absence of a clear rulе, involving may require cases Wis. Stat. 807.01 offer post-trial litigation. Payment additional collateral days may within 15 in be reasonable one case but not another, in or reasonable to one defendant but not to parties given If another. cannot know whether a offer engaging of settlement will be found valid without post-trial litigation, encourage the statute will not early and certain settlement. reject
¶ 41. For reasons, these we the court of appeals' proposed "reasonableness" standard for as- sessing permissibility conditions contained *16 statutory Companies offers of settlement. As the ob- agreements served, settlement often include terms payment confidentiality agree- schedules, such as noncompete Requiring ments, clauses, etc.12 courts to review the reasonableness of such conditions would
12 opinion today Our is not intended to chill these settle Rather, ment simply recognizes conditions. it purpose that the litigation. swamp in a of collatеral mire them dismal purpose of the stat- a result would frustrate Such ute. Accordingly, conclude that the test we may given provision in be included a valid a
whether provision is "reason- offer is not whether settlement specifies provision a whether the able," but rather remedy imposed by This test be the court.13 that could inquiry any fa- into reasonableness and also obviates judgment judicial comparison to the of the offer cilitates eventually bar, In the at at trial. case obtained days of the offer. Because demanded within 15 judgment judge requiring that the could not enter a days, payment within 15 we conclude defendant tender valid, offer was not and DeWitt is there- that DeWitt's prejudgment fore not entitled to double costs interest.
IV questions pertaining turn next to 43. We guar- beginning due, with whether Southwest's guarantee pay anty interest. Southwest included a only noting guaranty not, it refers contends did that the collateral of Wis. Stat. 807.01 would be frustrated generate. litigation that the "reasonableness" test would Companies argue imposition any that condi it invalid under tions on the offer of settlement renders Although position appear would to address Stat. 807.01. this above, Companies' argument the concerns we have outlined simplistic. The statute authorizes offers for is too settlement relief; types property equitable or it is the nature of these may they subject variety to a of conditions be relief are judgment. may impose a court imposed in the court's Because judgment, they may validly be set out in the such conditions offer of settlement. *17 timely payment and
to "the full of all statements for disbursements/expenses rendered services incurred Partnership." on behalf DeWitt counters that the guarantee "timely payment" unambiguously and full guarantees payment charges. for interest We conclude obligated guaranty that for Southwest interest due Galaxy Partnership's outstanding on account. guaranty
¶ 44. A ais contract. Klein-Dickert Osh Mortgage Corp., kosh Inc. v. 93 Frontier Wis. 2d (1980). 668-69, 287 N.W.2d742 aim "The ultimate of all interpretation contract is to ascertain intent of the parties." Co., Eden Stone Co. Stone 166 Wis. Oakfield (Ct. 1991). App. 105, 116, 2d N.W.2d Contracts give must be read in such a manner meaning as to reasonable provision rendering any to each and without portion superfluous. Isermann v. MBL Assurance Life (Ct. Corp., App. 136, 153, 231 Wis. 2d 605 N.W.2d210 1999). provided case, In this retainer letter "[Statements payable upon receipt.
DeWitt's are We right charge per reserve to interest at a rate of 18% (1 month) per paid on all annum statements not 1/2% days within 20 after date." in the their As noted retainer Galaxy Partnership pay letter, was without resources to legal required fees. DeWitt therefore Southwest guarantee "timely and full all statements disbursements/expenses rendered and in- services [Galaxy Partnership]." guar- on curred behalf of anty page was numbered four the retainer letter and simultaneously executed Havenick with retainer. Although guaranteed "timely ¶ Southwest payment," admittedly full interest is not mentioned in guaranty agreement Therefore, the am- itself. is obligation biguous respect pay Southwest's outstanding Galaxy Partnership's ac- on interest due *18 [meaning ambiguous determining count. "In proper language], held it is this court has that contract negotia- parties conduct of the and the to consider the place, after before and tions which took both and to all related execution of the documents consider parties." Osborn, 66 Wis. 2d Smith documents omitted). (citations (1974) 264, 272, 223 N.W.2d Here, are that the conduct of we satisfied parties an that Southwest was liable evinced intent pay- untimely consequences of and deficient for the guarantee otherwise, If Southwest's ments. it were "timely meaning- payments" be and full would rendered imposition percent of 18 interest on less, as would the Accordingly, partnership we which had no assets. guaranteed pay that it would conclude that Southwest Galaxy Partnership's outstanding on DeWitt interest account.
V guar- Having ¶ 48. determined that Southwest's anty interest, next included we consider whether DeWitt January charge 1,1997. to could interest retroactive Companies appeals erred in assert the court awarding January contract interest to DeWitt from impose to date from which DeWitt chose Galaxy unpaid Partnership's Under interest on balance. argument, charge entitled inter- their DeWitt was not to Companies intended est until it notified the that it reject right exercise under the contract. We its interest argument. Companies' above, noted the retainer letter executed As by pertinent part: Havenick 'You states and ex- will receive a statement for services rendered penses incurred on a basis. The monthly statements are payable upon We receipt. reserve the right to charge (1 interest at the rate of 18% per annum % per 1/2 month) on all statements not within 20 paid days after their date." On 24,1997, November DeWitt informed the Companies "unless this account is off paid 1, 1997, December we will the 18% apply interest rate for in provided 6, 1995, [the] December contract with you." 50. This court described the accepted practice
with respect Bluhm, Estreen v. to accrual of (1977). 79 Wis. 142, 158-59, 2d 255 N.W.2d There, consistent with a series of earlier precedent,14 this court *19 held that the defendants were entitled to interest from the date on which the were plaintiffs to supposed pay their an obligation under agreement to purchase land. It explained: general
The rule as to the time at begins which interest to run on a liquidated claim is that the creditor is entitled to interest from the time payment by due was and, the terms of the contract if no such time is 14See, e.g., Bank, In re County 369, Oconto State 6 Wis. (1942) ("The N.W.2d353 rule of course is that the debtor should pay interest from the time he ought when to paid have debt."); Vogt Soc., Calvary Lutheran Missionary Univ. (1933) ("The 380, 388, 251 N.W.239 established rule is that payment when the time of specified by is the terms of a contract, then computed interest is to be from the time that payment by terms."); was due those Mfg. Necedah Co. v.Juneau (1931) ("[T]he County, 206 Wis. 237 N.W.277 creditor is entitled to payment interest... from the performance time or by was due contract, or, the terms of the if that was not specified, then from the made, time that demand was and if no demand prior was made to time of the commencement of the time."). action, then from that and,
specified, from the time a demand was made then prior if made the time of no demand was to commence- action, ment of then from that time. from Therefore,
Id. in order to determine the date interest, is we first which the creditor entitled specifies whether examine the contract ascertain it underly- payment performance at or time which ing debt is due. Here, is that the of the it uncontested terms upon receipt required payment
retainer letter monthly specified that interest would statements twenty days. if accrue was within not received Applying general Estreen, rule we that conclude agreement DeWitt acted within the terms of its when January seeking 1,1997, interest retroactive to because entitled to interest from the time the DeWitt was (thаt payable upon receipt). is, statements were
VI Finally, ¶ 52. whether we examine DeWitt could statutory expense having recover as costs the both a videographer reporter and a court the same record Companies deposition. maintain cannot. it Specifically, they contend that Wis. Stat.
requires party arranging that a simultaneous steno- expense. graphic at record do so its own That statute provides "any deposition may be recorded au- *20 videotape stenographic transcript. diovisual without a Any party may arrange party's the action at the expense stenographic to have a record simultaneous 885.42(1) added). § (emphasis made." Wis. Stat. 814.01(1), prevailing ¶ 53. Under Wis. Stat. a plaintiff costs. is entitled recover Wisconsin Stat. 814.04(2) imposition of authorizes costs for "all the necessary by disbursements ... allowed law." in- This actually paid copies cludes "amounts out for certified papers any public postage, and records in offiсe; tele- graphing, telephoning express; depositions includ- ing copies ...Id. may, A54. circuit court its discretion, deter- requested
mine that the
item of cost was not a "neces-
sary"
deny
party
disbursement, and
a
costs on that
Aspen
Corp.,
Servs.,
basis. See
Inc. v. IT
220 Wis. 2d
(Ct.
1998).
App.
491, 511,
¶ 56. The
with the
aptly recognized by
appeals.
explained
was
the court of
It
885.42(1) provides
party wanting
that, "Section
that the
copy
deposition
pay
of the
must
it. The
for
statute does
deposition transcript
copy
not address whether the
or a
videotape
DeWitt,
are taxable as costs."
2d
267 Wis.
§§
Accordingly,
it looked to
Stat.
885.45
guidance.
*21
885.45(2)
that "the reason-
Section
states
recording testimony
videotape
expense
on
shall
able
(6)
(3)
in
and
allow
be costs
the action." Subsections
playing
editing
expenses
associated with
exception
"videotape
videotape,
of a
as a
with
(4),
Under subsection
material," to be taxed as costs.
videotape
expense
reproduction of the
of an audio
objections
ruling
by
on
track used
the court
sound
in the action.
shall be costs
§
Although
not con-
Wis. Stat.
885.45 does
specific provision
transcription,
about
Wis. Stat.
tain
prevailing
an
of costs to the
allows
award
"depositions including copies."
agree
party for
We
is not a situation where the
Dewitt that
this case
solely
transcripts
for the convenience of
were obtained
Bldg. Comm'n, 114
J.F. Ahern Co. v. State
counsel. See
(Ct.
1983).
App.
69, 109-10,
2d
By appeals the court of Court.—The decision of part part in in is affirmed and reversed and the cause is entry judgment remanded to the circuit court for opinion. consistent with this
¶ PROSSER, WILCOX, 60. JON E J. and DAVIDT. participate. J. did not (concur- ABRAHAMSON, C.J. 61. SHIRLEY S. dissenting agree
ring part, part). in in I (and join majority majority opinion on all on issues issues) except hold, I circuit all one. would as did the charge court, that DeWitt was not entitled to interest Galaxy's retroactively January unpaid 1, on bills to agreement per- I that the retainer fee 1997. conclude charge only to from November mits DeWitt interest Galaxy that it was the date that DeWitt notified charge exercising right its contractual to interest. "[i]t appeals The court of wrote that is undisputed that the terms of the retainer letter... specified if was not that interest would accrue monthly [of twenty days receipt
received within meaning statements]."1 of the words of the But the very dispute. retainer letter is much states, 63. The retainer letter "We reserve the right charge per interest at the rate of 18% annum month) (l1/2%per paid all on statements not within 20 added). days (emphasis after their date" Instead of giving specific begin date from which interest would merely accruing, empowers the retainer letter charging begin at date to some future be monthly Galaxy. determined. DeWitt sent bills to None monthly charged of these bills interest or stated that charged, although payments interest was or would be were arrears. *23 Galaxy
¶ 64. DeWitt announced to its intention to charge 24, interest a letter dated November 1997. charged payment if Interest would be full were not by partial 1, The received December 1997. client made payment, responded partial payment and DeWitt to the 8, 1997, a letter dated December in which it de- payment interest; manded of schedule attached to the retroactively January 1, calculated interest from letter 1997. This attached schedule reflected DeWitt's deci- retroactively sion to seek collection of interest from January arbitrarily 1997, 1, an selected date unrelated dealings lawyer to the retainer or to between and client. argument, ¶ 65. At oral ex- counsel DeWitt plained provision that the in the retainer letter contract automatically meant that interest would accrue from due, the time was and that DeWitt reserved 1 Stevens, Galaxy DeWitt Ross & & Gaming Racing S.C. v. P'ship, Ltd. 48, 267 233, App 2003 WI Wis.2d 670 N.W.2d
604 right But reserving interest. to waive right reserving right not the same as charge interest is If to waive automatically imposed. is to waive interest the right wanted to reserve it have stated should automatically imposed, that was in the retainer letter. so clearly ambiguous letter is the retainer 66. At best rule, ambigu- contractual As a general about interest. drafter.2 This rule of against are construed ities in an arrange- appropriate is especially interpretation rules of professional fees because the ment for legal on an duty attorney affirmative an place conduct 2 Bluhm, 142, 155, 473 2d 255 N.W.2d v. 79 Wis. Estreen (1977) Shern, 39, 49, 208 N.W.2d348 60 2d (citing Moran v. (1973)). WI 45, 15, 234 Chrysler Corp., See also Dieter Wis. 2d N.W.2d (Third) rule, the Restatement general on this
Based interpretation of the rale of Governing Lawyers states Law "[C]ontracts between contracts as follows: attorney-client fee standpoint frоm the lawyers to be construed are clients lawyer client's circumstances. in the person a reasonable any states ensuring that the contract thus hears the burden Re- expectations." reasonable client's diverging from a terms (Third) h, Lawyers § 18 cmt. at Governing the Law statement (1998). (Mass. 1311, 1315 Corp., 581 N.E.2d Beatty v. NP See also 1991): App. Ct. *24 meaning of a written the general proposition, As a doubt, against the document, placed is construed if in surely principle counts and the party that wrote it... writing lawyer on his or her the drafter is a double when fees, setting lawyers "are client. In account to a own greater duties than are their clients who owe fiduciaries Restatement general contracts." law of under the owed 46,§ (Third) Governing Lawyers comment b of the Law 1991). (Tent. Draft No. 605 any communicate to the client the for basis fees before commencing or within a reasonable time after the representation.3 majority opinion, condoning DeWitt's demand for interest, retroactive is not in keeрing spirit with either the or the letter of the rules designed to ensure clear communication between an attorney regarding and client the fees.4 majority opinion
¶ 67. The relies on Estreen v. proposition Bluhm5 and other cases for the that the interest due to DeWitt should run from the time the liquidated amount was due.6 However, neither Estreen nor the other cases cited involve a contract that in- right charge provision cludes a "reserve the interest" dispute attorney's aor over fees. Estreen and the other anything, analysis cases therefore little, add if to the present majority the retainer in letter case. The opinion's application "general of the rule of Estreen"7 to specialized provision attorney-client this contract and agreements oversimplifies fee the matter at hand. 20:1.5(b) ("When See SCR lawyer regularly has not represented client, the basis or rate of the fee shall be client, communicated to the preferably in writing, before or within a rеasonable time commencing after representation."). Comm, Standing
See ABA
on Ethics and Profl Responsibil-
(1993) ("At
ity,
Op.
Formal
93-379
represen-
outset of the
lawyer
tation the
should make disclosure of the
basis
the fee
any
and
charges
other
to the client. ... Initial disclosure of the
basis for the fee arrangement
fosters communication that will
promote the attorney-client
relationship.").
4 The
agreements
issues of written fee
settling
fee
disputes have been before the
petition
court
a rules
probably will come before the court again report
Ethics 2000 Committee recommending changes in the rules.
Bluhm,
(1977).
Estreen v.
79 Wis. 2d
part, I with settle- make a valid did not that DeWitt conclusion Majority op., ¶ Instead, I in this case. ment offer appeals of offer agree that DeWitt's the court of with permissible Wis. Stat. under was valid settlement 807.01(3). my § based I conclusion Nevertheless, reach language plain instead of on appeals. See of the court used test reasonableness Gaming, Galaxy 2003 WI Stevens Ross & 74.1 233, 670 N.W.2d App 2d ¶¶ 31-32, 267 Wis. appeals' majority disagree the court with also analysis pertaining Id., ¶¶ would 55-65.1 interest. recovery Wis. Stat. in accord with of interest allow the Recogniz- 807.01(4), interest. to contract in addition majority address the does not ing this court remaining respect issues to the issue, agreement. however, I am address, it does 7Id., majority proper ap- 71. The contends that the
proach determining *26 whether Wis. Stat. 807.01 permits 15-day such conditions as the deadline for payment language is to "look to the of the statute to interpret apply express provisions." Majority op., its nothing placement 35. Since authorizes the of condi- payment majority tions on under 807.01, the con- impose cludes that an offeror cannot conditions on payment. majority rejects Id., ¶ 36. The the reason- by appeals, ableness standard utilized the court of and, rejects instead, its own earlier test and concludes that applicable particular the test for whether a condition may be included a settlement offer is whether "the provision specifies remedy imposed by a that could be Id., the court." 42. Thus, because it concludes that a judge judgment requiring Compa- could not enter a the payment days, majority nies to make in 15 contends impose that DeWitt could not such condition itself. Id. agree appeals' approach I with the court of respect interprеtation this issue with to its of Wis. Stat. 807.01(3). 807.01(3) provides express prohi- Section no against bition the inclusion of a deadline in an 807.01(3) offer of simply provides settlement. Section plaintiff may upon that "the serve the defendant a written property, offer of settlement for sum, or or to specified, the effect therein with costs." There is no bar plain language contained within the of the statute itself that would render DeWitt's settlement offer invalid.
¶ 73. suggested Instead of the reasonableness test by appeals, the court of I believe that the correct approach plain language is to look to the of Wis. Stat. 807.01(3). provides, Section in relevant " part, [i]f accepted the offer of settlement is not plaintiff and the judgment, a recovers more favorable plaintiff shall recover double the amount of the statutory language, I on the taxable costs." Based majority disagree conditions with the and conclude that prohibited a are not in offers of settlement. When judg- present in a offer and a condition is settlement in the a court review case, ment is later obtained should by party judgment a more obtained is whether including condi- favorable than the settlement offer any, By statutory applying lan- if tions, therein. guage, I conclude that DeWitt made valid settlement money judgment for more offer, since the obtained was possible that therefore, more It is and, attaching was favorable. statutory types to a certain of conditions may offer result in conclusion a court settlement judgment in fact "more favor- obtained is not purposes of the than the offer for able" settlement *27 15-day However, the condition on statute. statutory case in the settlement offer in this
contained under the not render the settlement offer invalid does preclude the statute; nor it a conclusion that does judgment more favorable than the settle- obtained was (3) (4). § purposes of offer for 807.01 ment agree majority Although of the ¶ I the 74. validity regarding appeals' the court of conclusion strongly disagree conclusion offer, I with its settlement appeals regarding it The interest. court of stated Upthegrove in v. Lumber its decisions was bound (Ct. App. Co., 2d 447 N.W.2d367 mans Ins. 152 Wis. 1989) Gundersen, 106, 515 183 Wis. 2d and Erickson 1994) (Ct. App. thus, concluded that and, 293 N.W.2d analyses the cases controlled set forth those ¶ as DeWitt, Yet, here. 2d outcome Judge Dykman points do dissent, cases out his those namely presented here, whether not involve issue 807.01(4) § allowing interest in accord with Wis. Stat. permissible. Id., is in addition to contract interest involving 75. Erickson was a case the issue of litigant whether a was entitled to both common law prejudgment interest and interest under Wis. Stat. 807.01(4). § question of contract interest in addi- 807.01(4) § tion to interest was not discussed at all in helpful Erickson, Upthegrove so that case is not here. 807.01(4) § involved the of whether issue interest from top and Wis. Stat. 628.46 could be stacked one on Upthegrove, the other. 2dWis. 7 at 12-13. Whether statutory provisions regarding two distinct may interest presents entirely question be utilized an different 807.01(4) may than whether be rеcovered along pro- with contract interest. Those cases do not any guidance vide for the resolution of the issue presented here. convincingly, plain language 76. Most 807.01(4) recovery
Wis. Stat. allows for the of such any concerning interest, without limitation contract part: interest. Section states, in relevant If there is an offer of by party settlement under this section which accepted is not party recovers a judgment greater which is than equal or to the amount specified in settlement, the offer of party is entitled to interest at the annual rate of 12% on the amount recovered from the date of the offer of settlement until paid. amount is *28 Judge Dykman ¶ I, 77. like in dissent, his am not persuaded party that in silence a statute means that a 807.01(4) recovering is barred from Wis. Stat. inter- est in approach addition to contract interest. Such an equals prohibition appears illogical —silence — contrary language to the of the statute. disagreement regarding Althоugh
¶ I am in the 78. majority concerning agree of offer,I the a valid with issue the issues it discusses. court on the remainder of this guaranty agree specifically, I Southwest's More "timely payment of all statements make and full disbursements/expenses incurred services rendered Partnership" pay the it to accrued on of bound behalf op., agree Majority ¶ I as well. 43. also charge Companies interest retroactive could DeWitt January retainer terms 1, 1997, to provided since the letter's not accrue if was
that interest would receipt monthly days statement. made within Finally, agree Id., ¶ I that DeWitt could recover 51. reporter taking videographer and a court of both costs 814.04(2). deposition, pursuant to Wis. Stat. the same Id., ¶ 58. summary, I made In conclude that DeWitt 79. Companies. I further offer to the
valid settlement to recover interest conclude that was entitled in addition to the interest Stat. under Wis. provided Companies. I do for in contract with its majority agree, however, on the remainder it the issues discusses. respectfully foregoing reasons, I For part. part and concur
dissent DIANE that Justice I am authorized state joins this S. SYKES dissent/concurrence.