Nelson v. Travelers Ins. Co.

• Decision Date: 02 June 1981
• Docket Number: No. 80-273,80-273
• Citation: 102 Wis.2d 159,306 N.W.2d 71
• Parties: Bonnie J. NELSON and David Nelson, Plaintiffs-Appellant-Petitioners, v. TRAVELERS INSURANCE COMPANY, Nicholas Behling, d/b/a Behlings Sewage Disposal, and Lawrence Borchardt, Defendants-Respondents.
• Court: Wisconsin Supreme Court

Page 71

306 N.W.2d 71

102 Wis.2d 159

Bonnie J. NELSON and David Nelson, Plaintiffs-Appellant-Petitioners, v. TRAVELERS INSURANCE COMPANY, Nicholas Behling, d/b/a Behlings Sewage Disposal, and Lawrence Borchardt Defendants-Respondents.

No. 80-273.

Supreme Court of Wisconsin.

Argued April 29, 1981.

Decided June 2, 1981.

Kathleen J. Beck, Racine (argued) and Thompson & Coates, Ltd., Racine, on brief, for plaintiffs-appellants-petitioners.

Robert D. Sullivan, Milwaukee (argued) and Riordan, Crivello, Sullivan & Carlson, Milwaukee, on brief, for defendants-respondents.

CALLOW, Justice.

This is a review of a decision of the court of appeals affirming a judgment of the circuit court for Milwaukee county, the Honorable Harold B. Jackson, Jr., presiding. The sole issue before this court is whether under sec. 814.04(4), Stats.1977, ¹ when a personal injury action results in a jury verdict in favor of the plaintiff, but upon appeal the liability portion of the verdict is set aside and those issues, including a question of the plaintiff's contributory negligence, are retried, again resulting in a verdict for the plaintiff, interest on the damage award should be paid from the date of the first verdict (when the damages were determined) or the second (when the liability was determined). We conclude that in this case the interest should be paid from the date of the first verdict, and we therefore reverse the court of appeals.

Because this is not the first time these parties have appeared before us, see: Nelson v. Travelers Ins. Co., 80 Wis.2d 272, 259 N.W.2d 48 (1977), the facts giving rise to the plaintiffs' original claim, amply set forth in the above-cited opinion, need not be repeated here. For purposes of this review, it is sufficient to recite that the plaintiff and her husband brought suit against the defendants for injuries Mrs. Nelson received in an automobile accident. The action was tried to a jury which, on December 23, 1974, returned a verdict in favor of the plaintiffs, finding Mrs. Nelson 25 percent negligent and the defendants 75 percent negligent, and determining the damages to be $21,500 ² for Mrs. Nelson and $4,150 for her husband. After reduction of the damage amounts to reflect the jury's allocation of causal negligence and then addition of costs and disbursements, judgment was entered on the verdict on August 8, 1975.

From this judgment Travelers appealed, and this court, finding error in the proceedings below, reversed and ordered a new trial on the liability issues only. Nelson v. Travelers Ins. Co., supra at 285. Upon retrial of the liability issues to a jury, a second verdict was returned on August 24, 1979, again in favor of the plaintiffs, but this time finding Mrs. Nelson 20 percent negligent and the defendants 80 percent negligent. In a motion after verdict the plaintiffs, on September 6, 1979, requested judgment upon both the December 23, 1974, verdict and the August 24, 1979, verdict together with costs and interest on the net amount of damages, at the rate of 7 percent, from the date of the first verdict until the date of entry of the judgment sought in the motion. The question of the date from which interest was payable was briefed and argued, and on November 27, 1979, the trial court ruled that the plaintiffs were entitled to interest on the net amount awarded to the plaintiffs from the date of the second verdict. Judgment was entered accordingly on January 21, 1980. From this judgment the plaintiffs appealed.

The essence of the Nelsons' claim in this case is that under sec. 814.04(4), Stats.1977, they are entitled to interest upon the net damage award from the date of the 1974 verdict until the entry of judgment after the 1979 verdict. In support of their claim to interest dating from the earlier verdict, they cite four cases: Zeidler v. Goelzer, 191 Wis. 378, 211 N.W. 140 (1926); Fehrman v. Smirl, 25 Wis.2d 645, 131 N.W.2d 314 (1964); Rasmussen v. Milwaukee Electric Ry. & Transport Co., 261 Wis. 579, 53 N.W.2d 442 (1952); and Moldenhauer v. Faschingbauer, 33 Wis.2d 617, 148 N.W.2d 112 (1967).

In Zeidler the plaintiff was injured when the toboggan on which she was riding was struck by a car driven by the defendant Elton Goelzer, a minor. A jury found Goelzer 100 percent negligent and assessed the damages at $2,500. An appeal was taken on the issue of the defendant's father's liability under the family purpose doctrine. This court rejected the family purpose doctrine and remanded the case for a new trial on the issue of the father's liability under the theory of respondeat superior. Crossett v. Goelzer, 177 Wis. 455, 188 N.W. 627 (1922). On retrial a second verdict was returned, again in favor of the plaintiff. A second appeal was taken, and one issue therein was the propriety under then sec. 271.05, Stats. (which is substantially similar to the current sec. 814.04(4)), of allowing interest on the damage award from the date of the first verdict. After citing the text of the applicable statute we said:

"The action is one in tort; therefore the damages are not liquidated until they are determined. No question of damages was involved upon either the second trial or on the appeal from the judgment entered thereon. Naturally, under the decision on the former appeal, if the verdict had been favorable to the defendants, the jury's answer on the subject of damages would have been of no avail to the plaintiff. When, however, the jury assessed damages in the sum of $2,500 on the 18th day of March, 1921, such damages became liquidated, and under the language of the statute and its spirit, interest must be computed from that date. First Wis. Trust Co. v. Schmidt, 173 Wis. 477, 180 N.W. 832." 191 Wis. at 389, 211 N.W. 140.

Fehrman, supra, was another two-trial case. The first trial resulted in a verdict in favor of the defendant, although the jury did assess the plaintiff's damages. On appeal this court ordered a new trial on the liability issue which resulted in a second jury verdict, this time in favor of the plaintiff. A second appeal followed in which one of the issues raised was the allowance of interest on the amount of the damage award from the date of the first verdict, even though that verdict had resulted in a finding of no liability for the defendant. Once again we quoted the applicable statute and cited the Zeidler case, adding:

".... In the Zeidler Case, the verdict of the first trial was in favor of the plaintiff; nevertheless, we agree with the trial judge that this distinction is not controlling.

"The damages were liquidated after the first trial, and it was theoretically possible for a tender to have been made. Smith v. Atco Co. (1959), 6 Wis.2d 371, 395, 94 N.W.2d 697. We recognize that a defendant, victorious at the first trial, would scarcely contemplate a tender of damages; however, it does not follow that upon an ultimate loss of the case such defendant is protected from the burden of paying interest on the previously ascertained damages. This is especially true when, as here, no question of damages was involved upon the second trial." 25 Wis.2d at 659, 131 N.W.2d 314. Both Rasmussen and Moldenhauer involved situations where a damage award established by a jury verdict was reduced as excessive. In each case this court held that, where a verdict award is reduced in postverdict proceedings, interest is properly allowed from the date of the verdict, not the date of the reduction.

On the basis of these cases, particularly Zeidler and Fehrman, the petitioners argue that the damages were liquidated at the time of the first verdict, and as the second trial did not involve the retrial of any damage issues, interest is payable under sec. 814.04(4), Stats.1977, from the first verdict.

The respondents point out that in neither Zeidler nor Fehrman was there an issue as to the plaintiff's contributory negligence, so the defendant's exposure in each case was an "all or nothing" proposition. In this case, however, it is argued that there was an issue of Mrs. Nelson's contributory negligence at the second trial, and as a result the amount the defendant might actually owe the plaintiff could not be determined until the liability verdict, with its causal negligence allocation, was reached. Because of the unresolved allocation issue, the respondents claim the damages were not liquidated until the second verdict.

In support of this argument, the respondents rely upon City of Franklin v. Badger Ford Truck Sales, 58 Wis.2d 641, 207 N.W.2d 866 (1973), and Wyandotte Chemicals Corp. v. Royal Electric Mfg., 66 Wis.2d 577, 225 N.W.2d 648 (1975). In City of Franklin the city sued the manufacturer and seller of a fire truck for damages caused by the failure of a defective truck wheel. Although the jury was asked to allocate causal fault as between the city's operation of the truck and the defective condition of the wheel, it did not make any allocation among the three individual defendants. Because of this failure, we remanded the case for a new trial in order to make that determination, and in the concluding paragraph of our opinion we stated:

"From the above reasoning and conclusions, it necessarily follows that: ... (2) The trial court decision disallowing the plaintiff's claim to interest from the date of filing the complaint is affirmed, since the amount of damages payable by individual defendants was not fixed or determinable." 58 Wis.2d at 657, 207 N.W.2d 866.

Wyandotte involved a suit for property damage against three defendants. The damage figure was stipulated on November 16, 1967, and a verdict in favor of the plaintiff, allocating causal negligence among the defendants, was returned on December 8, 1972. Judgment was entered on April 9, 1973, and amended on May 7, 1973, to reflect the denial of the plaintiff's claim to preverdict interest dating from the date of the stipulation. After an exhaustive analysis of the law relative to prejudgment interest, we concluded...