Mucek v. Nationwide Communications, Inc., 00-3039.

• Decision Date: 21 February 2002
• Docket Number: No. 00-3039.,00-3039.
• Parties: Alexandra MUCEK d/b/a "Alakai Hotel & Suites," Plaintiff-Respondent, v. NATIONWIDE COMMUNICATIONS, INC., Defendant-Appellant.
• Court: Wisconsin Court of Appeals

252 Wis.2d 426

2002 WI App 60

643 N.W.2d 98

Alexandra MUCEK d/b/a "Alakai Hotel & Suites," Plaintiff-Respondent, v. NATIONWIDE COMMUNICATIONS, INC., Defendant-Appellant.

No. 00-3039.

Court of Appeals of Wisconsin.

Submitted on briefs May 4, 2001.

Decided February 21, 2002.

On behalf of the defendant-appellant, the cause was submitted on the briefs of Charles E. Pellino, Jr. and Susan C. Blesener of Pellino, Rosen, Mowris & Kirkhuff, S.C., Madison.

On behalf of the plaintiff-respondent, the cause was submitted on the brief of Jeffrey M. Blessinger of Cross, Jenks, Mercer and Maffei, Baraboo.

Before Dykman, Roggensack and Lundsten, JJ.

¶ 1. LUNDSTEN, J.

Nationwide Communications, Inc. (NCI) appeals an order of the trial court denying its motion to withdraw certain admissions. NCI also challenges evidentiary rulings and the court's failure to reduce the jury's punitive damages award. For the reasons that follow, we affirm.

Background

¶ 2. Alexandra Mucek is the owner of Alakai Hotel & Suites in Wisconsin Dells, Wisconsin. In January of 1997, Mucek entered into a contract for telephone service with NCI, a long-distance service provider. In April of 1997, Mucek took action to terminate her contract with NCI. Thereafter, NCI sued Mucek in Michigan, alleging breach of contract. The suit was ultimately dismissed by a Michigan court on jurisdictional grounds.

¶ 3. Mucek filed this suit against NCI in January of 1999, alleging various causes of action for fraud and misrepresentation, as well as breach of contract, negligent supervision, malicious prosecution, and abuse of process. Mucek sought both compensatory and punitive damages.

¶ 4. On March 15, 1999, Attorney Mark Alberg filed a notice of retainer indicating he was representing NCI and on that same day filed an answer. On May 20, a request for a substitution of counsel for NCI was filed. The court signed the requested order, substituting Attorney Harry Hertel for Attorney Alberg. The record does not indicate the reason for this substitution.

¶ 5. On June 10, 1999, the court issued an order directing that discovery be completed by December 31, 1999. On November 19, 1999, Mucek sent interrogatories and a request to produce documents to NCI.

¶ 6. On December 28, 1999, attorneys for both parties filed a stipulation, approved by the trial court, extending the discovery date until January 7, 2000. On February 2, 2000, Mucek filed a motion to compel discovery because NCI failed to respond to her interrogatories and request to produce. At a March 15 hearing on Mucek's motion to compel discovery, the trial court orally granted Mucek's motion and gave NCI until March 29, 2000, to respond. Previously, on February 22, the trial court had set trial for August 8, 2000, and extended the deadline for discovery to July 31, 2000.

¶ 7. On March 20, 2000, NCI's attorney, Harry Hertel, filed a motion to withdraw. In a supporting affidavit, the attorney stated that NCI had consistently failed to cooperate with counsel regarding discovery and would not even return his phone calls. The attorney noted that he had appeared at three hearings on motions to compel discovery against NCI in three separate cases. The motion to withdraw was granted.

¶ 8. On March 22, 2000, the trial court issued a written order granting Mucek's motion to compel, which, consistent with the oral order, gave NCI until March 29 to comply. In this order, the court warned NCI that the court would consider a motion to strike NCI's answer to the complaint, including NCI's denial of liability, if NCI failed to comply.

¶ 9. On April 3, counsel for Mucek filed a motion to strike NCI's answer along with a supporting affidavit stating that he had received no response to the interrogatories or request for documents from NCI. The motion included a notice of hearing on April 10.

¶ 10. NCI failed to respond to discovery, and a hearing was held on April 10, 2000, to address Mucek's motion to strike NCI's answer. NCI failed to appear, and the court orally granted the motion. A written order to this effect was issued on April 24, 2000. This order found NCI 100% liable and indicated the only remaining issue was damages.

¶ 11. On June 15, 2000, Mucek mailed to NCI a first request for admissions and a second set of interrogatories. Because there was no attorney of record, Mucek served the request on Robert Miller, the general manager for NCI. NCI failed to respond to the request for admissions within the statutory thirty-day time limit and, by statute, the matters asserted in the request were deemed admitted. See WIS. STAT. § 804.11(1)(b) (1997-98).¹

¶ 12. On July 24, 2000, Attorney Charles Pellino was retained by NCI and filed a notice of retainer. On August 3, Attorney Pellino filed a motion to extend the time for answering the request for admissions or, alternatively, to withdraw the admissions. In a supporting affidavit, Attorney Pellino stated that his preparation was hampered by the fact that NCI was involved in three cases that were "tightly scheduled" and that he had not yet received all the documents filed in this matter, including the request for admissions.

¶ 13. The trial court denied that motion orally during a hearing on August 3. For the most part, the arguments of the parties during this hearing were not recorded. Instead, the court went on the record at the end of the hearing to summarize and make its ruling. The recorded comments of the trial court and the attorneys make it apparent that NCI did not provide evidence at this hearing, or prior to it, showing that its failure to respond to the request for admissions was anything more than a continuation of its pattern of discovery abuse. The comments also show that NCI's new counsel asserted that the failure to respond was due to a "mix-up." Mucek's counsel responded: "There is no statement by anyone from NCI or from this hidden law firm which, supposedly, was part of the mix-up. There is just vague allegations of such."² On August 4, 2000, the judge signed a written order denying NCI's requests for an adjournment, to extend the time to respond to admissions, and to withdraw admissions.³

¶ 14. On the first day of trial, August 8, 2000, NCI filed a response to Mucek's first request for admissions and second set of interrogatories. NCI's counsel asked the court to reconsider its decision to strike NCI's answer to the complaint and renewed the motion to withdraw the admissions. Mucek's counsel's responses included the following:

Up until approximately four days ago, NCI has done nothing to cooperate with getting plaintiff discovery or any facts regarding this case . . . . Turning our attention to the requests for admission, again, [the] Court needs to look at the totality of the circumstances as to what happened and what was going on in this case. Now, counsel drops, this morning, an affidavit with all these factual allegations as to why they should be relieved of these requests for admissions. We're only 14 days late, come on, close enough . . . . First of all, keep in mind plaintiffs have been trying for now almost 2 years to get discovery, to get factual information. And, most importantly in this case, to get documents which would document exactly what contracts were altered, what contracts were forged.

The trial court denied NCI's request that it reverse its earlier rulings, again relying on NCI's history of abuse and concluding: "They have simply played games with the Court."

¶ 15. In connection with the damages issue at trial, NCI filed a motion in limine seeking exclusion of testimony from two other hotel owners in the Wisconsin Dells area, who had similarly been sued by NCI for breach of contract, on the basis that the testimony constituted inadmissible other acts evidence. The trial court denied that motion, stating that punitive damages are designed to punish egregious conduct and, to the extent that NCI was engaging in a course of egregious conduct, the testimony was relevant. ¶ 16. At trial, Mucek testified that sometime in late 1996 or early 1997, James Donker, a sales representative with NCI, approached her about changing her long-distance telephone service. Donker presented a standard form, carbonless, duplicate contract (containing a top white copy and a bottom yellow copy). The contract provided on the back that it would remain in effect for sixty months. Because Mucek objected to entering into a five-year contract with NCI, Donker crossed out the sixty-month language and changed it to twelve months. On the front of the contract, Donker also wrote: "You may void this contract at any time and for any reason." Both Donker and Mucek initialed the changes. Donker took the white copy and Mucek kept the yellow copy.

¶ 17. Mucek testified that after her hotel customers complained about being overcharged for long-distance calls, she decided to terminate the contract with NCI. She said that NCI sued her in Michigan for breach of contract and, in the course of that litigation, NCI produced a contract that was different from the one she had signed. Although her signature was the same on the contract NCI produced, the language making the contract voidable at any time, handwritten at the bottom of the contract by Donker, was missing. Additionally, the changes made to the back of Mucek's copy of the contract regarding the sixty-month term were also missing from the NCI copy. Finally, a paragraph was inserted on the back page of NCI's copy that stated the agreement would be governed and construed under the laws of the State of Michigan.

¶ 18. The parties stipulated that Mucek paid lawyers in Michigan $4350 to defend the suit brought by NCI. Mucek testified that the suit in Michigan was ultimately dismissed. ¶ 19. Mucek then introduced the testimony of Angie Tylka and Mary Maniak, both hotel owners in the Wisconsin Dells area. Both Tylka and Maniak testified that they too signed contracts with NCI for long-distance telephone services...