Emer’s Camper Corral, LLC v. Alderman, Appeal No. 2018AP458

• Decision Date: 19 March 2019
• Docket Number: Appeal No. 2018AP458
• Citation: 386 Wis.2d 592,2019 WI App 17,928 N.W.2d 641
• Parties: EMER’S CAMPER CORRAL, LLC, Plaintiff-Appellant, v. Michael A. ALDERMAN, Alderman, Inc. d/b/a Jensen-Sundquist Insurance Agency and Western Heritage Insurance Company, Defendants-Respondents.
• Court: Wisconsin Court of Appeals

386 Wis.2d 592

928 N.W.2d 641

2019 WI App 17

EMER’S CAMPER CORRAL, LLC, Plaintiff-Appellant,

v.Michael A. ALDERMAN, Alderman, Inc. d/b/a Jensen-Sundquist Insurance Agency and Western Heritage Insurance Company, Defendants-Respondents.^†

Appeal No. 2018AP458

Court of Appeals of Wisconsin.

Submitted on Briefs: February 19, 2019

Opinion Filed: March 19, 2019

On behalf of the plaintiff-appellant, the cause was submitted on the briefs of Steven L. Miller of Miller Appellate Practice, LLC., River Falls.

On behalf of the defendants-respondents, the cause was submitted on the brief of Rolf E. Sonnesyn and Beth L. LaCanne, Minneapolis, Minnesota.

Before Stark, P.J., Hruz and Seidl, JJ.

STARK, P.J.

¶1 Emer’s Camper Corral, LLC, ("Camper Corral") sued Michael Alderman and Alderman, Inc. d/b/a Jensen-Sundquist Insurance Agency (collectively, "Alderman"), asserting a single claim for negligence. Specifically, Camper Corral alleged that Alderman breached his duty as its insurance agent by procuring a policy for Camper Corral that contained a $ 5000 per-unit deductible for hail damage claims, instead of a policy with a $ 1000 per-unit hail damage deductible and an aggregate hail damage deductible of $ 5000. The case proceeded to a jury trial, and the circuit court ultimately granted Alderman’s motion for a directed verdict on two grounds: (1) Camper Corral failed to present an expert witness to testify regarding the standard of care; and (2) Camper Corral failed to establish that Alderman’s alleged negligence caused its damages.

¶2 We conclude the circuit court properly granted Alderman a directed verdict. To prevail on its negligence claim, Camper Corral was required to prove that Alderman’s conduct caused Camper Corral’s damages—that is, that his conduct was a substantial factor in producing those damages. In order to do so, Camper Corral needed to establish that, but for Alderman’s alleged negligence, Camper Corral could have obtained a policy that included a lower hail damage deductible than the policy Alderman actually obtained. Camper Corral failed to produce any evidence supporting a conclusion that it would have been able to obtain such a policy, absent Alderman’s alleged negligence. As such, Camper Corral could not establish, as a matter of law, that Alderman’s conduct was a cause of its damages. We therefore affirm the circuit court’s decision granting Alderman a directed verdict.¹

BACKGROUND

¶3 Camper Corral is a business that sells new and used campers. It is co-owned by Rhonda Emer and her husband. Camper Corral first purchased insurance through Alderman sometime in 2004 or 2005 when it needed to insure a recently completed building. In approximately 2007, Camper Corral first obtained a "garage policy" through Alderman to insure its inventory.

That policy, which was issued by General Casualty Company, included a $ 500 per-unit deductible for hail damage.

¶4 In May 2011, Camper Corral’s inventory sustained approximately $ 100,000 in damage during a hail storm. Camper Corral made a claim under the General Casualty policy, which had been renewed each year up until that time. General Casualty paid the claim, and in September 2011, it renewed Camper Corral’s policy for another year. The policy’s hail damage deductible remained at $ 500 per unit.

¶5 In the summer of 2012, Camper Corral’s inventory again sustained approximately $ 100,000 in hail damage. Camper Corral submitted a claim to General Casualty for that damage, which General Casualty paid. However, General Casualty subsequently provided Camper Corral with a notice of non-renewal of its policy. According to Rhonda Emer’s trial testimony, after receiving the notice of non-renewal, Alderman advised her that he would need to shop in "other markets" to obtain coverage for Camper Corral’s inventory, due to Camper Corral’s history of hail damage claims. Before Camper Corral’s policy through General Casualty expired in September 2012, Alderman contacted Emer and informed her that Western Heritage Insurance Company was willing to insure Camper Corral’s inventory, but with a hail damage deductible of $ 5000 per unit. Emer agreed to accept that policy. She testified Alderman told her that if Camper Corral did not submit a hail damage claim during the next policy year, Alderman believed he could obtain a policy with a reduced deductible of $ 1000 per unit.

¶6 Emer further testified that Alderman called her in August 2013 and informed her that Western Heritage had agreed to renew Camper Corral’s policy for the 2013-14 policy year with a hail damage deductible of $ 1000 per unit, capped at $ 5000 total. According to Emer, she and Alderman then met in person and reviewed a "Garage Premium Summary" for the Western Heritage policy. The summary sheet listed the policy’s deductible for "Dealers Phys Dam" as "Comp & Coll 1000/5000." For "Scheduled Auto: ... Phys Dam," the summary sheet listed the deductible as "1000 Comprehensive & Collision." Emer testified Alderman specifically informed her when reviewing the summary sheet that the policy had a $ 1000 per-unit deductible for hail damage claims, which was capped at $ 5000 total. Emer agreed to accept the renewed policy on those terms.

¶7 The 2013-14 policy was set to expire on September 30, 2014. Emer testified that, in August 2014, Alderman informed her he had obtained two quotes for the 2014-15 policy year—one from Western Heritage and one from Erie Insurance Company—both of which included hail damage deductibles of $ 1000 per unit. However, before he and Emer could meet in person to discuss those quotes, Camper Corral’s inventory was again damaged in a hail storm on September 3, 2014.

¶8 Emer testified she first received a copy of Camper Corral’s 2013-14 policy after the September 3, 2014 hail storm. She subsequently learned that the policy actually included a hail damage deductible of $ 5000 per unit, rather than $ 1000 per unit, and it did not include an aggregate hail damage deductible. Emer testified twenty-five campers were damaged during the September 2014 storm, and the total deductible therefore amounted to $ 125,000. After subtracting that amount from Camper Corral’s recovery, Western Heritage ultimately paid Camper Corral approximately $ 65,000.

¶9 Camper Corral filed the instant lawsuit in February 2015, asserting a single claim against Alderman for negligence.² The complaint alleged that Alderman breached his duty of care to Camper Corral by procuring insurance coverage for the 2013-14 policy year that included a $ 5000 per-unit deductible for hail damage, even though he "knew that [Camper Corral] wanted insurance coverage without a $ 5,000 hail deductible." Alderman moved for summary judgment, arguing Camper Corral could not prevail on its negligence claim because there was no evidence that Alderman’s conduct caused Camper Corral’s damages. Specifically, Alderman argued there was "no evidence that [Camper Corral] could have procured a property insurance policy to insure the campers against hail with a $ 1,000 deductible per camper." Camper Corral opposed Alderman’s summary judgment motion, and the circuit court ultimately denied it.

¶10 The case then proceeded to a jury trial. At trial, Camper Corral took the position that it was entitled to $ 120,000 in damages—the difference between its total deductible of $ 125,000 for the September 2014 hail damage claim and the $ 5000 aggregate deductible that Camper Corral believed its policy included. Before the case was submitted to the jury, Alderman moved for a directed verdict challenging the sufficiency of the evidence.³ As relevant to our disposition of this appeal, Alderman renewed his argument that Camper Corral had failed to prove his conduct caused its damages because there was "no evidence that it would have been possible or plausible for [Camper Corral] to procure a garage policy insuring the campers for hail with a $ 1,000 deductible and a $ 5,000 aggregate."

¶11 The circuit court agreed with Alderman and granted a directed verdict in his favor. In its written decision, the court explained that, although there was no Wisconsin case law directly on point, cases from other jurisdictions had held that a plaintiff alleging negligent procurement of an insurance policy

must present evidence that coverage would have been available if the agent had fulfilled its duty of care to the plaintiff. That is, [a] plaintiff can succeed if they are able to show that they would have been protected from the damages by an insurance policy that could have been purchased in the insurance market at the time the alleged breach occurred.

The court concluded Camper Corral had presented no evidence demonstrating that, absent Alderman’s alleged negligence, Camper Corral would have been able to obtain a policy containing a hail damage deductible less than $ 5000 per unit for the coverage period at issue. The court therefore dismissed Camper Corral’s negligence claim against Alderman, and Camper Corral now appeals.

DISCUSSION

¶12 As a threshold matter, we address an issue regarding the nature of Alderman’s motion challenging the sufficiency of the evidence. In its oral ruling on the motion, the circuit court cited WIS. STAT. § 805.14(4), which provides in relevant part: "In trials to the jury, at the close of all evidence, any party may challenge the sufficiency of the evidence as a matter of law by moving for directed verdict or dismissal." However, in its subsequent written decision, the court referred to Alderman’s motion as a "Motion for Summary Judgment, or in the alternative, Directed Verdict."

¶13 Camper Corral argues we should review the circuit court’s decision using the summary judgment methodology because the court "relied on submissions outside the evidence at trial" in reaching its decision. Camper Corral is correct that the circuit court relied on evidence outside the trial record when addressing Alderman’s alternative argument that dismissal was appropriate because Camper Corral had failed to...