Lucas v. Godfrey

Decision Date21 February 1991
Docket NumberNo. 90-0472,90-0472
Citation467 N.W.2d 180,161 Wis.2d 51
PartiesGeorge LUCAS, Alice Lucas, and G & T Lucas Tractor & Equipment Company, Plaintiffs-Appellants, d v. Robyn GODFREY, Defendant-Respondent, Reader's Digest Association, Inc., and Reuben H. Donnelley, Defendants. READER'S DIGEST ASSOCIATION, INC., Third Party Plaintiff, v. Rebecca SKALLERUD, Third Party Defendant.
CourtWisconsin Court of Appeals

Jon P. Axelrod and William D. Mollway of DeWitt, Porter, Huggett, Schumacher & Morgan, S.C., Madison, for plaintiffs-appellants.

James E. Doyle, Jr., Marsha M. Mansfield of Lawton & Cates, S.C., Madison, and James M. Bablitch, Stevens Point, for defendant-respondent.

Before EICH, C.J., and DYKMAN and LaROCQUE, JJ.

EICH, Chief Justice.

George and Alice Lucas (hereafter "Lucas") appeal from a summary judgment and an order dismissing their action to recover the $150,000 prize in a Reader's Digest sweepstakes contest and awarding the prize to the respondent, Robyn Warren. 1 When a dispute arose as to ownership of the winning entry card, the magazine paid the contest proceeds into court and the principal parties, Lucas and Warren, litigated entitlement to the prize.

We conclude that under general principles of contract law applicable to contests such as this, Warren is entitled to the prize amount and we therefore affirm the judgment and order. In doing so, we reject Lucas's alternative theories of recovery based on fiduciary duty, negligence, conversion and constructive trust. Finally, we hold that Warren is entitled to enhanced costs and interest under sec. 807.01, Stats., because, after Lucas rejected her pretrial settlement offer, Warren recovered a more favorable judgment.

The basic facts are not in dispute. Warren had been Lucas's secretary for several years. She performed various office duties, including picking up the mail. From time to time, Warren received personal mail at the office address--a post office box 2--and this controversy centers around a contest entry form sent to that address.

The Reader's Digest sweepstakes is a promotional effort on the part of the magazine designed, among other things, to increase subscription sales. Contest "eligibility cards" are sent to people around the country and entry is accomplished by returning the card to the magazine. The magazine obtains lists of subscribers to various other publications and mails promotional materials and contest eligibility cards to persons whose names appear on the lists. The cards contain number codes, indicating the particular magazine subscriber list from which the recipient's name and address were taken.

Reader's Digest sent an eligibility card, addressed by computer, to "Robyn W. Lucas" at the office post office box address. Warren crossed out the initial and the name "Lucas," inserted "Warren" in its place and returned the card. The card was eventually selected as the winner of a $150,000 prize.

The code number on the card indicated that the name and mailing address had been taken from a list of subscribers to Ellery Queen's Mystery Magazine. Warren was an Ellery Queen subscriber and the Lucases were not. The magazine's circulation director testified that, for a period of time, Warren's subscription was listed in the name Robyn W. Lucas, but that this error was corrected and at some point she began receiving the magazine as Robyn Warren. 3

When Warren's receipt of the prize became known, Lucas sued Warren and Reader's Digest, claiming that he was entitled to the money. Warren answered and cross-claimed, seeking a judgment that the money was hers. In light of these competing claims, Reader's Digest deposited $150,000 with the court, asking it to decide whether Lucas or Warren, or either of them, were entitled to claim the prize. Lucas and Warren both moved for summary judgment and the trial court granted Warren's motion.

The trial court, applying basic principles of contract law, concluded that: (1) Reader's Digest intended to offer the contest entry to Warren, as the Ellery Queen subscriber at the address to which the card was sent; (2) that Warren accepted the offer by returning the card; and (3) as a result, Warren was entitled to claim the prize. Other facts will be discussed in the body of the opinion.

In summary judgment cases, we employ the same analysis as the trial court. In re Cherokee Park Plat, 113 Wis.2d 112, 115-16, 334 N.W.2d 580, 582 (Ct.App.1983). Where the material facts of a case are not disputed, as is the case here, summary judgment is an appropriate means of raising and deciding the legal issues in the case. Smith v. State Farm Fire & Cas. Co., 127 Wis.2d 298, 300, 380 N.W.2d 372, 373 (Ct.App.1985). We decide those issues de novo, without deference to the trial court's decision. Green Spring Farms v. Kersten, 136 Wis.2d 304, 315-17, 401 N.W.2d 816, 820-21 (1987).

Pursuing that methodology, we have examined the parties' pleadings and conclude that they raise and join the issue--that the claim for the prize stated in Lucas's complaint is countered by Warren's responsive pleadings. In addition, we see no material issue of fact. As indicated, both parties moved for summary judgment and neither argues that factual disputes bar the other's motion. "The practical effect is that the facts are stipulated and only issues of law are before us." Silverton Enterprises v. General Cas. Co. of Wisconsin, 143 Wis.2d 661, 669, 422 N.W.2d 154, 157 (Ct.App.1988).

Lucas argues first that he is entitled to the prize under "basic principles" of contract law. While Wisconsin courts have not had the opportunity to consider the question directly--presumably because of the state's historic anti-lottery laws--we agree with the rule, which has been adopted in nearly every other jurisdiction in which the question has arisen, that contract law governs the sponsor-contestant relationship. 4 See Annotation, Private Contests and Lotteries: Entrants' Rights and Remedies, 64 A.L.R.4th 1021, 1045-52 (1988). An entrant or contestant who performs the act requested--here returning the card--accepts the offer to enter the contest and thus "form[s] a valid and binding contract with the promoter." Id. at 1045. The nature of the contract in such a contest, of course, is that if the contestant's number is selected as the winner, he or she is entitled to the prize.

Lucas argues that because the card was addressed to "Robyn W. Lucas," and because Robyn Warren is not "Robyn W. Lucas," she cannot recover. Under that reasoning, of course, neither can Lucas.

The Restatement of Contracts tells us that, in contract law, "[t]he manifested intention of the offeror determines the person or persons in whom is created a power of acceptance." Restatement (Second) of Contracts sec. 29 (1981). According to Reader's Digest 's general counsel, the magazine's intent when it sent the contest eligibility card to the Lucas post office box was to get the contest materials--and the magazine's promotional messages--"to prospective customers, in this particular case ... active subscribers to Ellery Queen Magazine."

These facts admit of a single reasonable inference: that Reader's Digest intended to offer entry in its sweepstakes to a person whose name appeared on the list of active subscribers to Ellery Queen's Mystery Magazine, and who would receive mail at the address taken from that magazine's subscriber list--Post Office Box 579, Wisconsin Rapids, Wisconsin. The fact that the card was addressed to Robyn W. Lucas, rather than Robyn Warren, is explained by the undisputed evidence of the manner in which Warren's name was originally--and mistakenly--listed in the Ellery Queen subscriber files. "Obvious errors of expression" in a contract are correctable and not fatal to the agreement where the agreement itself and the surrounding circumstances convince the court of the "inadverten[ce]" of the error. 3 A. Corbin, Contracts § 552, pp. 207-209 (1960). The circumstances of this case, evidenced by undisputed facts, satisfy us that any error in listing Warren's name in the Ellery Queen files, and thus on the Reader's Digest sweepstakes computer-generated contest mailing label, was indeed inadvertent and does not detract from the validity of the Digest 's sweepstakes offer. By accepting the offer made to her, Warren became eligible for the prize and when her number won, the trial court correctly awarded it to her. 5

Lucas disagrees. He argues first that the effect of the trial court's decision was to violate his "property interest" in his name, by allowing Warren "to divert mail containing the Lucas surname without ... permission." We are not persuaded. It may be, as Lucas contends, that he has a property interest in his name which is sufficient "to support [a] legal action[ ] for damages for [its] unauthorized use," but there is no evidence that Warren ever improperly "used" the name Lucas. The uncontradicted evidence is that the "Robyn W. Lucas" name initially, and erroneously, shown on the Ellery Queen records was corrected. There is nothing in the record suggesting that Warren intentionally appropriated or "used" Lucas's name for any purpose.

Lucas also contends that if Warren is awarded the prize, he is nonetheless entitled to recover damages from her under one of several theories: (1) that she breached a "fiduciary duty" owed to him; (2) that she "converted" his property when she returned the entry card; and (3) that she negligently caused him to lose an "economic advantage." We reject all such claims.

Lucas's "fiduciary duty" argument is based on the common-law rule that an employee must return to his or her employer any profits obtained in connection with the employment or the employer's business. See Degner v. Moncel, 6 Wis.2d 163, 167, 93 N.W.2d 857, 860 (1959). It is true that collecting and sorting the mail sent to the post office box was one of Warren's duties...

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