Olson v. Darlington Mut. Ins. Co., No. 2005AP1613.

• Decision Date: 21 September 2006
• Docket Number: No. 2005AP1613.
• Citation: 723 N.W.2d 713,2006 WI App 204
• Parties: Linda L. OLSON, Plaintiff-Appellant, Lands' End, Inc., Subrogated-Plaintiff, v. DARLINGTON MUTUAL INSURANCE COMPANY, Catherine J. Weber and Dennis Weber, Defendants-Respondents,<SMALL><SUP>†</SUP></SMALL> Robbins & Myers, Inc. and ABC Insurance Company, Defendants.
• Court: Wisconsin Court of Appeals

723 N.W.2d 713

2006 WI App 204

Linda L. OLSON, Plaintiff-Appellant, Lands' End, Inc., Subrogated-Plaintiff, v. DARLINGTON MUTUAL INSURANCE COMPANY, Catherine J. Weber and Dennis Weber, Defendants-Respondents,^† Robbins & Myers, Inc. and ABC Insurance Company, Defendants.

No. 2005AP1613.

Court of Appeals of Wisconsin.

Submitted on Briefs February 6, 2006.

Opinion Filed September 21, 2006.

On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Sheila Stuart Kelley of Kopp, McKichan, Geyer, Skemp & Stombaugh, L.L.P., Platteville.

On behalf of the defendant-respondent, the cause was submitted on the brief of Arnold P. Anderson of Mohr & Anderson, L.L.C., Madison.

Before DYKMAN, DEININGER and HIGGINBOTHAM, JJ.

¶ 1 DYKMAN, J

Linda L. Olson appeals from a non-final order compelling her to disclose to the remaining defendants the confidential settlement amount she received as a result of a Pierringer¹ release with defendant Robbins & Meyers, Inc. The remaining joint tort-feasors are Darlington Mutual Insurance Company and its insureds, Catherine J. Weber and Dennis Weber (collectively "Darlington"). Olson contends the trial court erred by compelling disclosure because the confidential settlement amount and the jurisdictional limit pleaded in her complaint are not inconsistent assertions. We agree and therefore reverse.²

Background

¶ 2 The parties do not dispute the following facts. Linda L. Olson was injured at the Weber barn when her elbow came into contact with a large fan. Olson sued the Webers (owners of the farm), Darlington (their insurance company), and Robbins & Meyers (the manufacturer of the fan). In her complaint, Olson demanded judgment not to equal or exceed the amount necessary for removal to federal court, $75,000. Olson then entered into a confidential Pierringer release with defendant Robbins & Meyers, dismissing them from the litigation. Darlington moved the court to compel disclosure of the settlement amount, asserting that Olson's request for less than $75,000 in her complaint to avoid removal to federal court precluded her from maintaining the confidentiality of the amount of the settlement. The trial court granted the motion to compel under the doctrine of judicial estoppel and "simple fairness," finding that Olson was required to disclose the settlement amount to allow Darlington to assess its remaining potential liability within Olson's asserted $75,000 of damages.³ We granted Olson leave to appeal the order.

Standard of Review

¶ 3 Darlington argues that Olson has the burden to prove that the trial court erroneously exercised its discretion by invoking judicial estoppel and, absent that showing, we may not address the issue on its merits. We disagree. Whether the elements of judicial estoppel have been met by the facts in a particular case is a question of law for appellate courts, reviewable de novo. Salveson v. Douglas County, 2001 WI 100, ¶ 38, 245 Wis.2d 497, 630 N.W.2d 182. Once those elements have been met, it is within the discretion of the trial court whether to invoke the doctrine. Id. Thus, we review whether the elements of judicial estoppel apply to the facts of this case de novo.

Discussion

¶ 4 Judicial estoppel is properly invoked "to prevent a party from adopting inconsistent positions in legal proceedings." State v. English-Lancaster, 2002 WI App 74, ¶ 18, 252 Wis.2d 388, 642 N.W.2d 627 (citing State v. Petty, 201 Wis.2d 337, 347, 548 N.W.2d 817 (1996)). Further, "[t]he purpose of judicial estoppel is to preserve the integrity of the judicial system and prevent litigants from playing `fast and loose' with the courts." Id. (citing Harrison v. LIRC, 187 Wis.2d 491, 497, 523 N.W.2d 138 (Ct.App.1994)). The required elements of judicial estoppel are:

First, the later position must be clearly inconsistent with the earlier position; second, the facts at issue should be the same in both cases; and finally, the party to be estopped must have convinced the first court to adopt its position—a litigant is not forever bound to a losing argument.

Petty, 201 Wis.2d at 348, 548 N.W.2d 817 (citing Harrison, 187 Wis.2d at 497, 523 N.W.2d 138).

¶ 5 Olson contends that Petty's use of the terms "both cases" and "first court" dictates that there must be two distinct cases to invoke the doctrine. She argues that judicial estoppel does not apply to her refusal to disclose the settlement amount because her complaint and the Pierringer release were submitted in a single case. However, we do not need to address whether judicial estoppel is available within the course of a single proceeding. We conclude that on the facts of this case, Olson's limit of her damages to $75,000 in her complaint was not enough to meet the requirement of "convincing the trial court to adopt her position."

¶ 6 Because "a litigant is not forever bound to a losing argument," there must be an action of the court adopting a party's position to give rise to judicial estoppel. Thus, in State v. Michels, 141 Wis.2d 81, 97-98, 414 N.W.2d 311 (Ct.App. 1987), Michels was judicially estopped from arguing on appeal that the evidence was insufficient to support his conviction for manslaughter, when he had requested the trial court submit manslaughter to the jury as a lesser-included offense of second-degree murder. Similarly, in English-Lancaster, 252 Wis.2d 388, ¶ 22, 642 N.W.2d 627, English-Lancaster was judicially estopped from challenging the sufficiency of a cautionary instruction he had requested. We said: "This is classic judicial estoppel. The position English-Lancaster took in the trial court is clearly inconsistent with the one he assumes on appeal. At trial he urged the court to generate a cautionary instruction and now he maintains that a cautionary instruction was insufficient." Id. (emphasis added).

¶ 7 Here, Olson's first assertion was her demand in the ad damnum clause in her complaint for less than $75,000 in damages. Unlike the cases above, however, Olson has not yet successfully urged the court to take action based on her position. Rather than successfully requesting a jury instruction, as in English-Lancaster, or successfully requesting submission of a lesser-included offense, as in Michels, Olson has merely asked for a limited amount of damages. Therefore, we conclude that Olson's pleading an amount in controversy beneath the threshold for federal jurisdiction is not equivalent to convincing the court to adopt a position in her favor.

¶ 8 Next, we turn to the requirement of two "clearly inconsistent" positions. Olson argues the "clearly inconsistent" element of judicial estoppel was not met because she has consistently requested less than $75,000 in damages, and the settlement she reached with Robbins & Meyers is not subject to that limit. Darlington asserts the trial court properly invoked judicial estoppel to prevent Olson from asserting two clearly inconsistent positions: first, that her damages were limited to less than $75,000, and then, that she did not have to disclose the amount she recovered from a settling joint tort-feasor. Without deciding the effect of the settlement amount on Darlington's remaining potential liability, we conclude that Olson's withholding the amount of a settlement with one joint tort-feasor is not clearly inconsistent with her previous pleading of a limit on the amount in controversy.

¶ 9 For judicial estoppel to apply, the two positions must be clearly inconsistent and have more than "[t]he mere appearance of inconsistency." Petty, 201 Wis.2d at 350 n. 5, 548 N.W.2d 817 (citation omitted). In Harrison, 187 Wis.2d at 493-96, 523 N.W.2d 138, LIRC argued Harrison was judicially estopped from claiming in a state discrimination action that he was capable of performing his job, when he had stated before a federal administrative law judge in disability proceedings that he was not capable of performing his job. We concluded that judicial estoppel did not apply because the record did not establish whether the definition of "capable" under each action included the option of working with accommodations. Id. at 499-500, 523 N.W.2d 138. We thus concluded we could not find the two statements clearly inconsistent on the facts in the record. Id.

¶ 10 Similarly, in Coconate v. Schwanz, 165 Wis.2d 226, 231, 477 N.W.2d 74 (Ct.App.1991), we concluded that Coconate's failure to disclose the existence of a promissory note during divorce proceedings was not clearly inconsistent with his later action to collect on the note. The failure to list a note did not meet the standard of "clearly inconsistent" with an assertion that the note was valid and enforceable. Id. Thus, "clearly inconsistent" means more than just a possibility of inconsistency from the facts on the record.⁴

¶ 11 Here, Olson has pleaded a limit on her damages and then withheld the amount of a settlement she reached with one joint tort-feasor. As in Harrison and Coconate, the two positions are not clearly inconsistent on the facts we have before us. There is no indication from the record that Olson is now asserting that she can recover more than $75,000 in damages by playing "fast and loose" with the courts as a "manipulative perversion" of the judicial process. See Petty, 201 Wis.2d at 346-47, 354, 548 N.W.2d 817 (citations omitted). Therefore, we conclude that Olson has not asserted two clearly inconsistent positions as required to apply judicial estoppel. Because we conclude that the elements of judicial estoppel have not been met by the facts in this case, we reverse.

Order reversed.

¶ 12 DEININGER, J. (concurring).

I agree with the majority that the doctrine of judicial estoppel does not provide a basis to order Olson to disclose at this time the amount she received in settlement of her claim against Robbins & Myers, Inc. The majority mentions but does not address the related issues of whether the settlement amount may be disclosed to jurors at trial and whether the settlement amount has any...