Hasley v. Black, Sivalls & Bryson, Inc.

• Decision Date: 25 November 1975
• Docket Number: Nos. 109 and 110,s. 109 and 110
• Citation: 70 Wis.2d 562,235 N.W.2d 446
• Parties: Andrew J. HASLEY and Employers Mutual Liability Insurance Company of Wisconsin, a Domestic Insurance Corporation, Plaintiffs-Respondents, v. BLACK, SIVALLS & BRYSON, INC., a Foreign Corporation, and Maryland Casualty Company, a Foreign Insurance Corporation, Defendants-Respondents, J. B. Smith Mfg. Co., a Foreign Corporation, Defendant-Appellant. WISCONSIN PUBLIC SERVICE CORPORATION et al., Plaintiffs-Respondents, v. BLACK, SIVALLS & BRYSON, INC. and Maryland Casualty Company, Defendants-Respondents, and J. B. Smith Mfg. Co., Defendant-Appellant. (1974).
• Court: Wisconsin Supreme Court

Page 446

235 N.W.2d 446

70 Wis.2d 562

Andrew J. HASLEY and Employers Mutual Liability Insurance

Company of Wisconsin, a Domestic Insurance

Corporation, Plaintiffs-Respondents, v. BLACK, SIVALLS & BRYSON, INC., a Foreign Corporation, and Maryland Casualty Company, a Foreign Insurance

Corporation, Defendants-Respondents,

J. B. Smith Mfg. Co., a Foreign Corporation, Defendant-Appellant.

WISCONSIN PUBLIC SERVICE CORPORATION et al., Plaintiffs-Respondents, v. BLACK, SIVALLS & BRYSON, INC. and Maryland Casualty Company,

Defendants-Respondents,

and

J. B. Smith Mfg. Co., Defendant-Appellant.

Nos. 109 and 110 (1974).

Supreme Court of Wisconsin.

Nov. 25, 1975.

Axley, Brynelson, Herrick & Gehl, Madison, for defendant-appellant.

Dempsey, Magnusen, Williamson & Lampe, Oshkosh, for plaintiffs-respondents.

HANLEY, Justice.

The following issues are presented on this appeal:

1. May the respondent assert additional bases for appellant's qualification for personal jurisdiction, which were not raised in the trial court?

2. Has appellant waived his objection to personal jurisdiction by raising such objection in an answer containing a cross-complaint against co-defendants and third party defendant for contribution?

3. Is personal jurisdiction conferred by Sec. 262.05(4)(b), Stats.?

4. Would the assertion of personal jurisdiction in this case violate due process?

New Issues

In the reply brief on this appeal, respondent urges decisional grounds not asserted in the trial court. Citing McLaughlin v. Chicago, M., St. P. & P.R. Co. (1964), 23 Wis.2d 592, 127 N.W.2d 813 and Milwaukee County v. Schmidt, Garden & Erikson (1967), 35 Wis.2d 33, 150 N.W.2d 354, the respondent asserts that a notice of appearance sent to the plaintiff's attorney by counsel for Smith was an act inconsistent with the special appearance demanded to preserve the jurisdictional issue. Further, the joinder in the answer of a defense of lack of personal jurisdiction with a cross-complaint for contribution is also characterized as a general appearence. Neither issue is mentioned in the trial court's memorandum decision on the motion. The issues as phrased by respondent in its reply brief were conceded as unanswered by the trial court. Smith, in its own reply brief, states that these issues were not considered by the trial court and have appeared only in the respondent's brief.

Ordinarily, questions which are not properly presented to the trial court will not be considered for the first time on appeal. Fond du Lac Skyport, Inc. v. Moraine Airways (1975), 67 Wis.2d 109, 114, 226 N.W.2d 428. Exceptions do exist as to this rule. An exception has been claimed as to questions of jurisdiction, Northern States P Co. v. Hunter Bd. of Supv. (1973), 57 Wis.2d 118, 133, 203 N.W.2d 878, but this exception is more particularly applicable to latent defects in subject matter jurisdiction, Telford v. City of Ashland (1898), 100 Wis. 238, 239, 75 N.W. 1006, because defects in personal jurisdiction are waived if not timely presented. Sec. 262.16(6), Stats. In this case, the new issues are presented merely to bolster the trial court's finding of jurisdiction. Therefore, no compelling policy exists to ignore the general rule. Also, this court has declined to consider new issues when they involve factual elements not fully disclosed in the record. Hastings Realty Corp. v. Texas Co. (1965), 28 Wis.2d 305, 318, 137 N.W.2d 79.

The nature of the first new issue is such as to involve unique factual considerations. In McLaughlin, the personal jurisdiction objection based on faulty service of process was raised only after a notice of retainer and appearance and a request for additional time to answer was made. A distinction was made between the simple notice of retainer and such notice of appearance that requires all service of papers to be made on the appearing counsel, Sec. 269.37, Stats., with the latter qualifying as a general appearance inconsistent with the special appearance necessary when personal jurisdiction is questioned. Sec. 262.16, Stats.; Id., 23 Wis.2d at 596, 127 N.W.2d 813. In Schmidt, Garden & Erikson, the objection to faulty service came after an out of state defendant received only a copy of the summons and in response mailed a demand for the complaint which was subsequently served. This court declined to follow the general appearance possibility of McLaughlin, but found that jurisdiction was conferred by the defendant's acquiescence in the service as an active participant in the suit. Both cases imply, however, that accompanying acts expressly indicating an intent to reserve the jurisdictional question would have precluded the finding of waiver. Thus the factual context is important whenever a question arises as to whether a general appearance waiving jurisdiction has occurred. In this case, Smith has replied to the first new issue by an affidavit asserting an oral reservation of the jurisdictional issue in a conversation with plaintiff's counsel prior to the notice of appearance. Since the record indicates no consideration of the factual context surrounding the asserted waiver, and since the appellant has produced support as to the existence of factual questions, it would be inappropriate for this court to decide the legal question involved.

Respondent's second new issue concerns the effect of a cross-complaint by appellant in the same document containing its answer alleging the lack of jurisdiction. The question raised being purely one of law, the issue may be considered in the exercise of this court's discretion. General Electric Co. v. Wisconsin E.R. Board (1958), 3 Wis.2d 227, 246, 247, 88 N.W.2d 691.

Waiver by Cross-Complaint for Contribution

Sec. 262.16, Stats., defines the method for preserving the objection to lack of personal jurisdiction:

'Raising objection to personal jurisdiction; general appearance. (1) General appearance. An appearance of a defendant who does not object to the jurisdiction of the court over his person is a general appearance and gives the court personal jurisdiction over him.

'(2) How and when objection shall be made. An objection to the court's jurisdiction over the person is not waived because it is joined with other defenses or motions which, without such objection to jurisdiction, would constitute a general appearance. Such objection shall be raised as follows:

'(a) By motion when a defect is claimed in the service of the summons without a complaint; or when the defect appears upon the face of the record other than the complaint; or in case of a judgment on cognovit or by default;

'(b) By demurrer when the defect appears upon the face of the complaint; and

'(c) By answer in all other cases.

'. . .

'(6) Waiver of objection to lack of personal jurisdiction. Except as provided in sub. (5), an objection to the jurisdiction of the court over the person is waived if not made as provided in this section.' (emphasis added)

Respondent contends that the cross-complaint for contribution made in Smith's answer was not such a 'defense or motion' allowed by Sec. 262.16(2), Stats., to be joined with a personal jurisdiction objection; rather, the claim transformed the pleading into a 'general appearance' under Sec. 262.16(1), Stats., to support this conclusion, respondent cites language quoted in Lees v. ILHR Department (1971), 49 Wis.2d 491, 182 N.W.2d 245. Discussing the situation of one who has objected to the court's jurisdiction over his person, the Lees statement concluded with:

". . . and if by any application on his behalf relief is sought on other matters or of a nature which would require the recognition of the jurisdiction of the court (than) the objection on the ground of want of jurisdiction is waived and lost, and cannot thereafter be reasserted; . . ." Id. at 499, 182 N.W.2d at 250.

While respondent's contentions at first glance appear to have merit, they are frivolous. The language cited in Lees accurately stated the law prior to this court's creation of the current Sec. 262.16, Stats. See 271 Wis.P. vii, creating Sec. 262.17(2) to (7), Stats.1957. It was quoted by the court to inferentially support the conclusion in Lees that no timely objection to personal jurisdiction had been made, a conclusion mainly grounded on Sec. 262.16, Stats. In Lees, the ILHR Department's first answer challenged the reviewing court's subject matter jurisdiction. A few weeks later a motion challenging personal jurisdiction was made. The court properly found that claim waived by the prior appearance without objection.

Such facts are a striking contrast to the case at bar. Appellant Smith's answer contained both the jurisdictional objection and the cross-complaint. The cross-complaint for contribution is a conditional remedy that exists only after the initial liability is established, and the claim for contribution was placed after the objection within the document. This placement is not determinative under the statute, which merely allows that the defenses or motions may be joined with the objections. The Lees case is consistent and respondent's contentions are inconsistent with the observation by this court in Punke v. Brody (1962), 17 Wis.2d 9, 115 N.W.2d 601 on Sec. 262.16:

'(It was) adopted for the purpose of making a substantial change in the law with respect to challenges to jurisdiction over the person and to avoid certain consequences of the former law which were deemed undesirable. One such consequence was that a defendant could not preserve his objection to jurisdiction over his person while contesting the plaintiff's claim on other grounds. Nothing in these subsections requires a holding, and such holding would be inconsistent with their purpose, that after a defendant has joined in his answer his objection to jurisdiction and his defenses on the merits, any subsequent appearance by him to prepare for or to go to trial on the merits constitutes a waiver of his objection to jurisdiction over his person.' Id. at 16, 115 N.W.2d...