South Milwaukee Savings Bank v. Barczak

• Decision Date: 27 July 1999
• Docket Number: No. 97-3759.,97-3759.
• Parties: SOUTH MILWAUKEE SAVINGS BANK, Plaintiff-Appellant, v. Gary J. BARCZAK, in his official capacity as Clerk of Courts, unknown Clerk of Courts Docketing Clerk and Rod Lanser, Defendants-Respondents.
• Court: Wisconsin Court of Appeals

229 Wis.2d 521

600 N.W.2d 205

SOUTH MILWAUKEE SAVINGS BANK, Plaintiff-Appellant, v. Gary J. BARCZAK, in his official capacity as Clerk of Courts, unknown Clerk of Courts Docketing Clerk and Rod Lanser, Defendants-Respondents.¹

No. 97-3759.

Court of Appeals of Wisconsin.

Oral argument May 12, 1999.

Decided July 27, 1999.

On behalf of the plaintiff-appellant, the cause was submitted on the briefs of Mark E. Sostarich of Petrie & Stocking, S.C., of Milwaukee, with oral argument by Mark E. Sostarich.

On behalf of the defendants-respondents, the cause was submitted on the brief of Mark A. Grady, Principal Assistant Corporation Counsel, of the Office of Milwaukee County Corporation Counsel.

Before Wedemeyer, P.J., Schudson and Curley, JJ.

CURLEY, J.

South Milwaukee Savings Bank (South Milwaukee) appeals from the trial court's grant of summary judgment to the former Milwaukee County Clerk of Courts in South Milwaukee's suit alleging that an employee of the clerk of courts office violated § 806.10(3), STATS., by failing to docket, at the proper time, a judgment granting South Milwaukee money damages which, in turn, impaired South Milwaukee's collection attempts.² South Milwaukee argues that the trial court erred in deciding that: (1) the two-year statute of limitations found in § 893.93(2)(a), STATS., not the six-year statute of limitations in § 893.93(1)(a), STATS., applies to actions under § 806.10(3); (2) South Milwaukee's cause of action accrued on September 27, 1994, the day after the clerk's office received the judgment, and not when South Milwaukee discovered the delayed docketing; (3) the requirement in § 806.10(3) that judgments be docketed "at the proper time" was ambiguous in describing when a judgment should be docketed and that "at the proper time" meant "as soon as practicable" or "within a reasonable time";³ and (4) the respondent complied with § 806.10(3) by docketing the judgment the day after receipt of the judgment. In addition, South Milwaukee argues that the trial court improperly expanded the record without notice and that it was entitled to summary judgment. Because we agree with South Milwaukee that the six-year statute of limitations should govern actions under § 806.10(3), and because we are satisfied that under the undisputed facts of this case, as a matter of law, the respondent violated § 806.10(3) when the clerk failed to docket the judgment until the day after receipt, we reverse and remand and direct the trial court to enter partial summary judgment for South Milwaukee.⁴

I. BACKGROUND.

On October 13, 1993, South Milwaukee filed an action against Nikolau-Rooney Real Estate Investment Corporation for a money judgment on a promissory note and guarantee of the note. South Milwaukee also sued John W. Rooney, Jr., because he signed a personal guarantee for the corporation's loan. On September 26, 1994, the circuit court granted summary judgment in favor of South Milwaukee in its suit against both the corporation and Rooney, and awarded $304,105.91 in damages.

After the hearing, South Milwaukee's attorney gave the trial court a proposed order and judgment which the trial court reviewed and signed. South Milwaukee's attorney then obtained the court file, went to the Milwaukee County judgment clerk's office at approximately 3:30 p.m., and paid the appropriate judgment and docketing fees. The clerk's office entered the judgment, but for reasons never explained, failed to docket the judgment until the following day despite the fact that the clerk's office was open until 5:00 p.m.⁵

The judgment encumbered two rental properties owned by Rooney. Although Rooney was out of the country when the trial court issued its judgment, his wife was present in the courtroom and heard the trial court's decision. After the trial court granted summary judgment in favor of South Milwaukee, Mrs. Rooney went home and retrieved two quitclaim deeds dated September 12, 1994, that allegedly conveyed Rooney's interest in the property to her. Mrs. Rooney, armed with her two quitclaim deeds, returned to the court-house and went to the Register of Deeds office where she had the quitclaim deeds recorded. This occurred after the clerk's office entered South Milwaukee's judgment but before it was docketed.

Evidence submitted in support of the summary judgment motion revealed that in September of 1994, the clerk's office was in the process of implementing a computerized system for recording, entering, and docketing judgments. The old "manual system" required two steps: (1) the judgment would be presented, the appropriate fee paid, and the clerk would sign the judgment and formally enter it; and (2) the docketing clerk would type the judgment into what eventually became the Judgment Docket. Depending on the circumstances, the entire process could take between one and three days.⁶

Additionally, despite the statutory mandate that judgments be docketed "at the proper time," the clerk's office devoted only a few hours a day to docketing judgments. On the day South Milwaukee's judgment was entered the clerk's office stopped docketing judgments at 3:20 p.m. and did not begin again until the following day.

Unaware of the delayed docketing, South Milwaukee proceeded in its attempt to collect the debt owed to it by Rooney. To satisfy the debt, South Milwaukee obtained an execution on its judgment and purchased the Rooney rental properties at a Sheriff's sale for $115,000. South Milwaukee then filed a collection action against the Rooneys. As a result, Mrs. Rooney and South Milwaukee entered into a stipulated judgment that stated that South Milwaukee's judgment was for debt incurred in the interest of the marriage or family and was subject to satisfaction from all marital assets. This judgment was taken to the clerk's office and entered on May 15, 1995. Although South Milwaukee paid the docketing fee, the Milwaukee County Clerk's Office never docketed this judgment.

Unbeknown to South Milwaukee, Mrs. Rooney borrowed $78,000 from Wauwatosa Savings Bank (Wauwatosa) and gave the bank a mortgage on the rental properties as security. When it learned of the mortgage, South Milwaukee filed an action against Mrs. Rooney and Wauwatosa seeking a determination of the priority of South Milwaukee's lien as to Wauwatosa's mortgage; and if Wauwatosa held the superior position, a determination that the deed transfer was fraudulent; further, South Milwaukee requested the appointment of a receiver to sell the property to satisfy the mortgage and apply the balance to South Milwaukee's claim.

In the priority lien suit, summary judgment was granted in favor of Wauwatosa because Wauwatosa held a priority lien interest as a good faith purchaser. South Milwaukee contends that if the original judgment would have been docketed before Mrs. Rooney filed the quitclaim deeds, South Milwaukee would have had a priority position over Wauwatosa. South Milwaukee started this action against the respondent arguing that pursuant to § 806.10(3), STATS., the clerk's office failed to docket the judgment "at the proper time" and South Milwaukee was entitled to treble damages. The statute in question reads:

Every clerk of circuit court who enters a judgment or decree and enters upon the judgment and lien docket a date or time other than that of its actual entry or neglects to enter the same at the proper time shall be liable in treble damages to the party injured.

Section 806.10(3), STATS., 1995-96 (emphasis added). The trial court granted the respondent's motion for summary judgment on several grounds. It found that: (1) the two-year and not the six-year statute of limitations applied; (2) South Milwaukee's cause of action accrued on September 27, 1994 and not at a later date; therefore, the statute of limitations had run on this claim; (3) the wording of § 806.10(3), STATS. that docketing be done "at the proper time" was ambiguous and actually meant "as soon as practicable" and within a "reasonable" time; and (4) applying this interpretation of the language, the respondent complied with the statute by docketing the South Milwaukee judgment on September 27, 1994. This appeal follows.

II. ANALYSIS.

[1]

South Milwaukee's appeal requires this court to determine the proper interpretation and application of a Wisconsin statute. The interpretation of a statute is a question of law which we review de novo without deference to the circuit court's decision. See Erdman v. Jovoco, Inc., 181 Wis. 2d 736, 748, 512 N.W.2d 487, 491 (1994)

; In re I.V., 109 Wis. 2d 407, 409, 326 N.W.2d 127, 128 (Ct. App. 1982).

[2]

Because our interpretation of the statute requires us to reverse the trial court and apply the six-year statute of limitations, South Milwaukee has stated a viable cause of action and its motion for summary judgment must be considered. Our review of a trial court's denial of summary judgment is de novo. See Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315-16, 401 N.W.2d 816, 820 (1987)

. Summary judgment should be granted if the evidence demonstrates "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." RULE 802.08(2), STATS.

A. The six-year statute of limitations applies to actions brought under § 806.10(3), STATS.

South Milwaukee maintains that the circuit court erred in finding that the two-year statute of limitations contained in § 893.93(2)(a), STATS., governs actions under § 806.10(3), STATS. Instead, it argues the six-year statute of limitations should apply. We agree.

[3]

In Jovoco, the Wisconsin Supreme Court addressed the issue of whether a two-year, or a six-year statute of limitations governed a Wisconsin statute that prohibited employers, except under certain conditions, from deducting amounts from an employee's wages, absent written authorization from the employee. In deciding that the six-year statute of limitations applies here, we replicate the supreme court's...