Shannon v. Shannon

Decision Date26 June 1989
Docket NumberNo. 87-1478,87-1478
Citation150 Wis.2d 434,442 N.W.2d 25
PartiesChristen Michaela SHANNON, a minor, by her Guardian ad Litem, Plaintiff-Co-Appellant, v. James P. SHANNON and Edith Ann Rachel Shannon, Defendants-Appellants, United Services Automobile Association, Commercial Union Insurance Companies, Steven Schultz and Donna Schultz, Defendants-Respondents-Petitioners.
CourtWisconsin Supreme Court

Terry E. Johnson, argued, Janet E. Cain and Peterson, Johnson & Murray, S.C., on briefs, Milwaukee, for defendant-respondent-petitioner, United Services Auto. Ass'n.

Ronald L. Piette, argued, Michael T. Steber and Piette, Nelson, Zimmerman & Dries, S.C., on briefs, Milwaukee, for defendants-respondents- petitioners, Commercial Union Ins. Co., Steven Schultz and Donna Schultz.

Lynn Carey, argued, Peck and Carey, S.C., on brief, Oconomowoc, for plaintiff-co-appellant.

Daniel C. Sullivan, Chicago, Ill., argued, Eric J. Van Vugt, Minahan & Peterson, S.C., Milwaukee, and Sullivan & Associates, Ltd., Chicago, Ill., on briefs, for defendants-appellants.

CECI, Justice.

This case is before the court on petitions for review of a decision of the court of appeals, Shannon v. Shannon, 145 Wis.2d 763, 429 N.W.2d 525 (Ct.App.1988), which reversed a judgment of the circuit court for Milwaukee county, Joseph P. Callan, circuit judge, granting summary judgment to the petitioners, Steven and Donna Schultz (Schultzes) and their insurers, Commercial Union Insurance Companies (Commercial) and United States Automobile Association (USAA), and dismissing the claim against USAA as insurer of James and Edith Shannon (Shannons). Three issues are presented for review. The first issue is whether the circuit court erred in granting summary judgment to the Schultzes and their insurers. The second issue is whether the Schultzes are immune from liability to Christen Shannon under section 895.52(2), Stats. 1983-84. 1 The third issue is whether an insurer can waive a family member exclusion clause in its insurance policy. We conclude that the circuit court improperly granted summary judgment to the Schultzes and their insurers. In addition, we find that the Schultzes are not immune from liability to Christen Shannon under section 895.52(2). Finally, we hold that, as a matter of law, an insurer cannot waive a family member exclusion clause in its insurance policy.

The facts of this case are as follows. Christen Shannon, age three at the time of the accident, was seriously injured on July 1, 1984, when she nearly drowned in a lake abutting her parents' home near Elkhorn, Wisconsin. Christen sustained extensive brain damage and is permanently and extensively disabled. At the time of the accident, Christen's parents, James and Edith Shannon, were sitting in their boat which was docked at their pier. Christen had been playing in the Shannons' yard and had then wandered over to the adjoining property owned by the Schultzes. The Schultzes were entertaining guests on their outdoor patio located on the lakeshore and when Christen went over to the Schultzes' property, Mr. Shannon called her home. Mrs. Schultz responded, "It's okay, she's not hurting anything, she'll be all right." After approximately five minutes, Mr. Shannon noticed he could not see Christen, and a search ensued. Approximately fifteen minutes later, Christen was found floating in the water near the Schultzes' pier.

On July 15, 1985, Christen, by her guardian ad litem, commenced a lawsuit against the Shannons; their homewoners insurance carrier, USAA; and their personal umbrella liability insurance carrier, also USAA. On March 26, 1986, USAA filed a motion for summary judgment on the ground that the policies contained a family member exclusion clause, excluding coverage for the Shannons' liability arising from their negligence in causing Christen's injuries. The circuit court denied that motion on July 14, 1986, finding that a question of fact existed as to whether USAA had waived its right to rely upon the exclusion.

USAA then moved to bifurcate the trial of the insurance coverage issues from the trial on the merits of the complaint. The circuit court granted the motion. On February 2, 1987, the jury returned its verdict that USAA had not waived its right to assert the family member exclusion in its policies. The Shannons' and Christen's motions after verdict were denied, and judgment was entered dismissing the claims against USAA as the insurer of the Shannons.

On March 26, 1986, Christen also filed a complaint against the Schultzes; their homeowner's insurance carrier, Commercial; and their personal liability umbrella insurance carrier, which was also USAA. The complaint was amended on October 3, 1986. On October 28, 1986, the Schultzes and Commercial answered the amended complaint and cross-claimed against the Shannons for contribution. On October 29, 1986, the Shannons answered the amended complaint and cross-claimed against the Schultzes for contribution. On December 29, 1986, the Schultzes and Commercial made a motion for summary judgment. On April 29, 1987, the circuit court granted the motion for summary judgment, holding that the undisputed facts failed to establish any duty on the part of the Schultzes to Christen.

Christen appealed to the court of appeals from the judgment dismissing her action against the Schultzes and their insurers. The Shannons appealed the judgment dismissing their cross-complaint against the Schultzes and their insurers. Both Christen and the Shannons appealed the judgment which dismissed the claim against USAA as insurers of the Shannons.

The court of appeals addressed three principal issues in its decision. The first issue addressed by the court of appeals was whether the circuit court erred in granting summary judgment to the Schultzes and their insurers. The court of appeals found that the circuit court erred and reversed the circuit court decision granting summary judgment to the Schultzes and their insurers, holding that material issues of fact bearing on the Schultzes' negligence were present. The court of appeals held, citing Antoniewicz v. Reszczynski, 70 Wis.2d 836, 236 N.W.2d 1 (1975), that the duty to exercise ordinary care toward nontrespassers is the same as the duty of care in the usual negligence case and that this duty is not limited to conditions and defects on the premises. The court of appeals noted that a material issue of fact existed as to whether the Schultzes exercised ordinary care under the circumstances. As a result, the court of appeals concluded that the existence of the issue of fact relating to the negligence of the Schultzes made the grant of summary judgment improvident.

The second issue addressed by the court of appeals was whether the Schultzes were immune from liability under section 895.52(2), Stats. The court of appeals held that section 895.52(2) does not apply to cases of land-occupier negligence when a party enters onto the land for nonrecreational purposes and that Christen was visiting the Schultzes and was not on their property for a "recreational activity." Therefore, the court of appeals concluded that section 895.52(2) did not immunize the Schultzes from their negligence, if any, toward Christen.

The final issue addressed by the court of appeals was whether the circuit court erred in holding that the issue of whether USAA had waived its family member exclusion clause was a question of fact for the jury. The court of appeals found in regard to this issue that the facts concerning USAA's alleged waiver of the family member exclusion provision in its policies were undisputed and that, therefore, under Rural Mutual Ins. Co. v. Peterson, 134 Wis.2d 165, 180, 395 N.W.2d 776 (1986), the circuit court erred in submitting the waiver issue to the jury. The court of appeals held, given its conclusion that the facts concerning the waiver issue were undisputed, that a question of law was presented and that under the facts of the case, USAA had waived its right to assert the family member exclusion as a matter of law.

WHETHER THE CIRCUIT COURT ERRED IN GRANTING SUMMARY JUDGMENT
TO THE SCHULTZES AND THEIR INSURERS

This court reviews a circuit court's grant of summary judgment by applying the standards set forth in section 802.08(2), Stats., in the same manner as the circuit court. Green Spring Farms v. Kersten, 136 Wis.2d 304, 315, 401 N.W.2d 816 (1987). Under section 802.08(2), summary judgment must be entered "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." For a court to hold that no jury question is presented and that an actor is not negligent as a matter of law, the court must be able to say that no properly instructed, reasonable jury could find, based on the facts presented, that the defendants failed to exercise ordinary care. LePoidevin v. Wilson, 111 Wis.2d 116, 124, 330 N.W.2d 555 (1983), quoting Ceplina v. South Milwaukee School Board, 73 Wis.2d 338, 342, 243 N.W.2d 183 (1976).

Christen Shannon's amended complaint alleges that immediately prior to her near drowning, Christen was present on the Schultzes' property with the knowledge and consent of the Schultzes. The amended complaint also alleges that the Schultzes owed to Christen the duty to exercise ordinary care under the existing circumstances so as to avoid exposing Christen to an unreasonable risk of harm and that the Schultzes breached the duty owed to Christen and were negligent in failing to protect Christen from the danger of near drowning in the lake. The Schultzes' answer to Christen's amended complaint denies that the Schultzes owed a duty to Christen, denies any negligence on the part of the Schultzes, and denies that any acts or conduct by the Schultzes was a cause of or resulted in the...

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