Heaton v. Larsen, 79-123

• Decision Date: 11 August 1980
• Docket Number: No. 79-123,79-123
• Citation: 294 N.W.2d 15,97 Wis.2d 379
• Parties: Timothy P. HEATON and Valerie Heaton, his wife, Plaintiffs-Respondents, v. Darwin T. LARSEN, Defendant-Appellant-Petitioner. *
• Court: Wisconsin Supreme Court

Page 15

294 N.W.2d 15

97 Wis.2d 379

Timothy P. HEATON and Valerie Heaton, his wife, Plaintiffs-Respondents, v. Darwin T. LARSEN, Defendant-Appellant-Petitioner.^*

No. 79-123.

Supreme Court of Wisconsin.

Submitted on Briefs June 3, 1980.

Decided June 27, 1980.

Reconsideration Denied Aug. 11, 1980. ^*

Jerome L. Rinzel, Cudahy, and Harold A. Dall, Michael A. Mesirow and Kasdorf, Dall, Lewis & Swietlik, S. C., Milwaukee, of counsel, for defendant-appellant-petitioner.

T. Michael Schober and Schober & Radtke, New Berlin, for plaintiffs-respondents.

ABRAHAMSON, Justice.

The issue on appeal is whether an order of the circuit court denying defendant's motion to dismiss the action for want of personal jurisdiction is appealable as of right to the court of appeals or is appealable only on leave granted by the court of appeals. In an unpublished decision dated April 20, 1979, the court of appeals dismissed the defendant's appeal on the ground that the appeal was not from a final order and therefore was not appealable as of right under sec. 808.03(1), Stats., ¹ and also refused to grant leave to appeal from the non-final order on the ground the defendant failed to show that any of the criteria set forth in sec. 808.03(2), Stats., ² were applicable. We affirm the decision of the court of appeals that this order is not a final order appealable as of right.

The underlying action in this case was commenced by the plaintiffs seeking compensatory and punitive damages for an alleged slander committed by the defendant. Following the service of the summons and complaint, the defendant brought a motion pursuant to sec. 802.06(2)(c), Stats., to dismiss the action on the ground of lack of jurisdiction over the person of the defendant. ³ Following the procedure set forth in sec. 801.08(1), Stats., ⁴ the circuit court proceeded to hold a hearing and to decide the jurisdictional issue prior to the trial on the merits of the case. Sec. 801.08(1), Stats., provides that if after the hearing on the defendant's objection, the circuit court decides that it has jurisdiction, the case may proceed on the merits; if the circuit court decides that it lacks jurisdiction, the defendant shall be given the relief required. Sec. 801.08(1), Stats., specifically provides that "(s)uch decision upon a question of jurisdiction shall be by order which is appealable."

The circuit court determined that it had personal jurisdiction over the defendant and issued an order denying defendant's motion. The defendant filed a notice of appeal from this order contending that he could appeal the order to the court of appeals as a matter of right, because sec. 801.08(1), Stats., specifically states that a decision upon a question of jurisdiction "shall be by order which is appealable." To protect himself, the defendant also filed an alternative petition for leave to appeal pursuant to sec. 808.03(2), Stats., on the ground that if he did not have an appeal as a matter of right, then the court of appeals should grant him leave to appeal. As we have stated previously, on April 20, 1979, the court of appeals issued an order dismissing the appeal and denying defendant's request for leave to appeal.

This court granted the defendant's petition for review, limiting the issue on review to the question of the appealability of the order deciding the question of personal jurisdiction entered pursuant to sec. 801.08(1), Stats.

The parties agree that the issue presented on appeal is whether appealability of the order is governed by sec. 801.08 or by sec. 808.03, Stats., and whether the order, if governed by sec. 808.03, is a final or non-final order for purposes of appellate review.

The defendant's position is that an order entered pursuant to sec. 801.08, Stats., denying a motion to dismiss for lack of personal jurisdiction, is appealable as a matter of right to the court of appeals, because sec. 801.08, Stats., specifically provides that the question of jurisdiction shall be decided by an order which is appealable.

The plaintiffs' position is that defendant's appeal rights must be determined under sec. 808.03, Stats., which governs appeals to the court of appeals. The plaintiffs argue that sec. 808.03, Stats., the newer general appeal statute, controls instead of sec. 801.08, Stats., a section in the Rules of Civil Procedure regulating court procedure; and that the order in the instant case is not a final order appealable of right under sec. 808.03(1), Stats., but is appealable by permission of the court of appeals under sec. 808.03(2), Stats.

Although the parties disagree as to the resolution of the issue, they do agree that the instant case poses questions of statutory interpretation. We think it would be helpful in resolving the issue if we review the legislative history of secs. 801.08 and 808.03, Stats.

Sec. 801.08(1), Stats., began its existence on September 1, 1956, as sec. (Rule) 262.17(4) and (5), which was adopted by Supreme Court order pursuant to sec. 251.18, Stats.1955. ⁵ Rules, 271 Wis. vii. Sec. (Rule) 262.17(2)-(5), provided as follows:

"262.17(2) An objection to the court's jurisdiction over the person of a defendant 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 the 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.

"(d) In the case of a judgment on cognovit or by default there shall be annexed to the motion a proposed demurrer or answer in which all defenses upon which the defendant relies shall be alleged.

"(3) Where any defect specified in subsection (2) does not appear on the face of the pleadings or otherwise on the record, the parties to the action by their respective attorneys may stipulate in writing that the issues of fact and law with respect thereto shall be determined by the court in advance of the trial on the merits.

"(4) All issues of law raised by an objection specified in subsection (2), and all issues of law and fact pursuant to the stipulation specified in subsection (3) shall be tried in advance of any issue going to the merits of the case. If, after such a hearing on the objection, the court decides that it has jurisdiction, the case may proceed on the merits; if the court decides that it lacks jurisdiction, the defendant shall be given the relief required by such decision. Such decision shall be by order which is appealable. The raising of such objection and the making of such a stipulation may be called a special appearance, but the effect of objection, stipulation, or appearance is limited to that specified in subsection (2).

"(5) Where the objection is raised by motion under subsection (2)(a) all issues shall be determined by order of the court, which order is appealable ; the time for responding to any proposed pleading shall run from the date of the order constituting the court's decision on the objection." (Emphasis supplied.)

Sec. (Rule) 262.17 was designed to supplant the holdings of several cases decided by this court which operated to convert a defendant's intended special appearance to object to personal jurisdiction into a general appearance which waived all defects in the service of process. These cases created technical traps for the unwary. See Clausen & Lowe, The New Wisconsin Rules of Civil Procedure, chs. 801-803, 59 Marq.L.Rev. 14-15, 52-53 (1976). The injustice caused by these procedural traps became graphically clear in Ozaukee Finance Co. v. Cedarbury Lime Co., 268 Wis. 20, 24, 66 N.W.2d 686 (1954), in which three justices dissented noting that the majority had "practically abolishe(d) special appearances in Wisconsin."

Rule 262.17 had been proposed to the court by the Judicial Council to permit a defendant to raise by demurrer, motion or answer the claim that the trial court had no jurisdiction over his person and to permit a defendant to combine an objection to personal jurisdiction with a matter relating to the merits of the action, without waiving the jurisdictional objection. ⁶ Punke v. Brody, 17 Wis.2d 9, 16, 115 N.W.2d 601 (1962); Pavalon v. Thomas Holmes Corp., 25 Wis.2d 540, 547, 131 N.W.2d 331 (1964); Bazan v. Kux Machine Co., 52 Wis.2d 325, 339, 190 N.W.2d 521 (1971).

At the same time that the court adopted sec. (Rule) 262.17, described above, the court also amended sec. (Rule) 274.33 again adopting the Judicial Council proposal, to conform to the change in sec. (Rule) 262.17. Sec. 274.33(3), which governed orders appealable to the supreme court, was amended to permit an appeal to the supreme court when the trial court "decides a question of jurisdiction." 271 Wis. x. ⁷ An order appealable under sec. 274.33 was in effect appealable as a matter of right to the supreme court since there were no permissive appeals. The Judicial Council's notes (dated 10/21/55) to its proposed draft of sec. (Rule) 274.33(3), Stats., states:

"The provision permitting an appeal whenever the court 'decides a question of jurisdiction' is new. Thus, an order ruling on the contention that the court lacks jurisdiction over the person of the defendant under the provisions of s. 263.17[sic] is appealable prior to trial of the case on the merits; and because the objection that the court lacks jurisdiction over the subject matter can never be waived, an order disposing of that question becomes appealable whenever made."

Secs. (Rules) 262.17 and 274.33 remained unchanged until 1959 when the legislature repealed and recreated chapter 262, Stats. Laws of 1959, ch. 226. This 1959 revision was largely the work of Professor G. W. Foster, Jr., of the University of Wisconsin Law School...