Kroner v. Oneida Seven Generations Corp.

• Decision Date: 11 July 2012
• Docket Number: No. 2010AP2533.,2010AP2533.
• Citation: 342 Wis.2d 626,2012 WI 88,819 N.W.2d 264
• Parties: John N. KRONER, Plaintiff–Appellant–Petitioner, v. ONEIDA SEVEN GENERATIONS CORPORATION, Defendant–Respondent.
• Court: Wisconsin Supreme Court

342 Wis.2d 626

819 N.W.2d 264

2012 WI 88

John N. KRONER, Plaintiff–Appellant–Petitioner,

v.ONEIDA SEVEN GENERATIONS CORPORATION, Defendant–Respondent.

No. 2010AP2533.

Supreme Court of Wisconsin.

Argued March 7, 2012.

Decided July 11, 2012.

For the plaintiff-appellant-petitioner, there were briefs filed by Michael F. Brown, Peterson, Berk & Cross, S.C., Appleton, and oral argument by Michael F. Brown.

For the defendant-respondent, there was a brief filed by Thomas L. Schober, Davis & Kuelthau, S.C., Green Bay, and oral argument by Thomas L. Schober.

N. PATRICK CROOKS, J.

[342 Wis.2d 627]¶ 1 This case concerns a Brown County Circuit Court's order to transfer to a tribal court a civil suit that was brought against a tribally owned entity by a nonmember of the tribe.¹ The question before us is whether the circuit court erroneously exercised its discretion when it transferred the action to tribal court.²

[342 Wis.2d 628]¶ 2 John Kroner, who is not a member of the Oneida Tribe of Indians, had served as chief executive officer of Oneida Seven Generations Corporation (Seven Generations), a tribally owned real estate and holding company, for approximately seven years before he was terminated from his position in 2008. He sued Seven Generations in circuit court, claiming wrongful discharge and breach of contract. The order to transfer that we review here was issued by the Brown County Circuit Court, the Honorable Donald R. Zuidmulder presiding, and deals with the threshold questions regarding which court should hear the case; it does not address the merits of Kroner's claims.

¶ 3 To determine whether the circuit court's granting of the motion to transfer was an erroneous exercise of discretion, we must determine if the circuit court made “an error of law” or “neglect[ed] to base its decision upon the facts of the record.” Ash Park, LLC v. Alexander & Bishop, Ltd., 2010 WI 44, ¶ 32, 324 Wis.2d 703, 783 N.W.2d 294. Where a multi-factor test is required, a court “applie[s] an incomplete, and thus incorrect, standard of law” if it considers only one required factor and “neglect[s] to address any of the other statutory factors.” LeMere v. LeMere, 2003 WI 67, ¶ 22, 262 Wis.2d 426, 663 N.W.2d 789. Failure to apply “the proper statutory rigor” constitutes error. Id. at ¶ 25.

¶ 4 We acknowledge that the circuit court faced difficult issues without the benefit of any appellate decisions providing guidance concerning the interpretation and application of Wis. Stat. § 801.54 (2009–10) ³, which “authorizes the circuit court, in its discretion, to transfer [an] action to the tribal court” and sets forth the conditions for doing so. Reviewing this case presents an opportunity to set forth the analysis and the governing legal principles that we hope will be useful to a circuit court that is considering a motion for discretionary transfer under the statute. ⁴ The statute states, in part:

Discretionary transfer. When a civil action is brought in the circuit court of any county of this state, and when, under the laws of the United States, a tribal court has concurrent jurisdiction of the matter in controversy, the circuit court may, on its own motion or the motion of any party and after notice and hearing on the record on the issue of the transfer, cause such action to be transferred to the tribal court. The circuit court must first make a threshold determination that concurrent jurisdiction exists.

The statute thus requires a “threshold determination” by the circuit court. It then provides that “in the exercise of its discretion the circuit court shall consider all relevant factors....” It states that the factors a court shall consider include but are “not limited to” a series of facts, such as the tribal membership status of the parties, the timing of the motion to transfer, and the court in which the action can be decided most expeditiously. Wis. Stat. § 801.54(2). The record in this case does not show that the circuit court made the necessary threshold determination and considered “all relevant factors” as required. The circuit court proceeded to the second step without articulating a basis for concurrent jurisdiction. It then focused on one of the factors listed in the statute—the factor related to “[w]hether issues in the action require interpretation of the tribe's laws, including the tribe's constitution, statutes, bylaws, ordinances, resolutions, or case law”—without addressing the other relevant factors.

¶ 5 Where a court has not clearly discussed on the record the basis for a finding of concurrent jurisdiction and also the statutory factors it is required to consider, the record cannot be deemed adequate to support a decision to affirm. Because the facts and the applicable law were not fully stated and considered together in making both the determinations that the statute requires, the order to transfer was an erroneous exercise of the circuit court's discretion. We therefore reverse the court of appeals and remand to the circuit court for reconsideration in light of this opinion. A court that is considering transferring a case to a tribal court under the tribal transfer statute must conduct a two-part analysis. It must make a clear record of its findings and conclusions regarding concurrent jurisdiction, as well as an analysis of all of the rule's relevant factors on the facts presented.

¶ 6 In this case, the court must also make a record of its reasoning and conclusion concerning the separate question of the applicability of Wis. Stat. § 801.54 to this case. That requires applying the principles set forth in Trinity Petroleum, Inc. v. Scott Oil, Inc., 2007 WI 88, ¶ 40, 302 Wis.2d 299, 735 N.W.2d 1. This court held that the general rule concerning retroactive applicability of procedural rules adopted by the court had certain exceptions. The parties here were ordered by this court to address that question when the petition for review was granted, in light of the fact that the case was pending at the time Wis. Stat. § 801.54 became effective.⁵Trinity Petroleum states that the ordinary rule of retroactivity for procedural statutes such as Wis. Stat. § 801.54 does not apply if the rule in question “diminishes a contract, disturbs vested rights, or imposes an unreasonable burden on the party charged with complying with the new rule's requirements.” Id., ¶ 7. Because there may be additional facts to be developed before the circuit court that would be relevant to determining if the exception to retroactivity applies, the parties and the court should address that issue on remand.

¶ 7 Upon remand the circuit court may reach the same conclusion concerning transfer, but only after a thorough process has been followed by the circuit court. A reviewing court will then be in a better position to evaluate any appeal arising from a transfer because the record before it will necessarily contain an explicit determination concerning concurrent jurisdiction, analysis of all relevant factors, and the circuit court's holding on retroactive application.

I. BACKGROUND

A. Standard of review

¶ 8 A decision to transfer an action to tribal court pursuant to Wis. Stat. § 801.54, titled “Discretionary transfer of civil actions to tribal court,” lies in the circuit court's sound discretion. “A reviewing court will affirm the circuit court's exercise of discretion unless it was erroneous. The circuit court erroneously exercises its discretion if it makes an error of law or neglects to base its decision upon the facts of the record.” Ash Park, 324 Wis.2d 703, ¶ 32, 783 N.W.2d 294. We have made the following statements about the kind of discretionary rulings we will uphold: “This court will uphold the circuit court's order if the circuit court applies a proper standard of law, examines the relevant facts, and reaches a conclusion that a reasonable court could reach, demonstrating a rational process.” Luckett v. Bodner, 2009 WI 68, ¶ 31, 318 Wis.2d 423, 769 N.W.2d 504. “[A] discretionary determination must be the product of a rational mental process by which the facts of record and law relied upon are stated and are considered together for the purpose of achieving a reasoned and reasonable determination.” King v. King, 224 Wis.2d 235, 248, 590 N.W.2d 480 (1999).

B. Facts and procedural history

¶ 9 John Kroner was terminated from his job as chief executive officer of Seven Generations, a tribally chartered corporate entity that is controlled by the Oneida Business Committee on behalf of the Oneida Tribe of Indians. After his termination, he brought this suit. The first of Kroner's claims is that his termination from his job without cause was a breach of contract. Kroner's second claim is for wrongful discharge in violation of Wisconsin public policy. Both parties support their respective positions with reference to tribal documents. Kroner alleged that his termination without cause violated Seven Generations' stated policies and procedures, which Kroner argued constituted an employment contract. Kroner argued that the Oneida Personnel Policy and Procedure book (also called the “OPPP” or the “Blue Book”) as well as the By–laws of Seven Generations, both “indicate cause is required for a worker to be discharged.” Seven Generations' position was that a different document, the Oneida Seven Generations Corporation Employee Guidelines, is the document governing the terms of Kroner's employment, and it argues that this document shows that Kroner's employment was at-will and could be terminated without cause.

¶ 10 On October 1, 2008, Seven Generations moved to dismiss for failure to state a claim, arguing that the Blue Book did not apply to Kroner, and that he was an at-will employee. After a hearing on the motion to dismiss, the circuit court suggested that the parties ask the Oneida Tribal Judicial System to accept transfer of the case. In response, the Oneida tribal court sent a letter, at the circuit court's suggestion, on April 29, 2009, stating...