Vrieze v. Vrieze
| Decision Date | 31 March 1998 |
| Docket Number | No. 97-2947,97-2947 |
| Citation | 218 Wis.2d 167,578 N.W.2d 210 |
| Parties | NOTICE: UNPUBLISHED OPINION. RULE 809.23(3), RULES OF CIVIL PROCEDURE, PROVIDE THAT UNPUBLISHED OPINIONS ARE OF NO PRECEDENTIAL VALUE AND MAY NOT BE CITED EXCEPT IN LIMITED INSTANCES. Patricia A. VRIEZE, Plaintiff-Appellant, v. John H. VRIEZE, Defendant-Respondent. |
| Court | Wisconsin Court of Appeals |
APPEAL from a judgment of the circuit court for St. Croix County: ERIC J. LUNDELL, Judge. Affirmed.
Before CANE, P.J., and MYSE and HOOVER, JJ.
Patricia Vrieze appeals a judgment dismissing a misrepresentation suit she filed against her former husband. Patricia and John Vrieze were divorced in November 1993. Patricia had previously filed a motion to reopen the divorce judgment, alleging that John had misrepresented the value of marital assets; that she had relied on the values of assets he had represented to her and to the court; and that she would not have entered into the marital settlement agreement absent his misrepresentations. Her allegations were based on an October 1994 interim company financial statement showing Vrieze Farms valued at $358,304, which differed significantly from the negative $36,516 value John gave on his financial statement in November 1993 in the divorce proceeding. Patricia claims the 1994 valuation was circumstantial evidence of John's misrepresentations in the divorce proceeding. Patricia also alleged that John misrepresented the value of other property that he claimed was a transfer of real estate to Roger and Barbara Thompson. In February 1996, the court denied Patricia's motion to reopen the divorce proceedings.
Approximately two months later, Patricia filed the underlying action in this case, a suit against John alleging fraudulent and negligent misrepresentation and strict responsibility misrepresentation, seeking compensatory and punitive damages. The trial court 1 granted John's motion for summary judgment, holding that the doctrines of issue and claim preclusion barred Patricia's suit. Patricia now appeals.
Patricia claims the trial court erred when it granted summary judgment in John's favor based on its conclusion that the doctrine of issue preclusion barred her misrepresentation suit against John. She argues that the trial court's application of issue preclusion is fundamentally unfair and inequitable. She also claims the trial court erred by applying the doctrine of claim preclusion. 2
Our review of a trial court's grant of summary judgment is de novo. Green Spring Farms v. Kersten, 136 Wis.2d 304, 315-16, 401 N.W.2d 816, 820 (1987). We apply the same methodology as the trial court. Id. That methodoglogy has been described in many cases and need not be repeated again here. See Grams v. Boss, 97 Wis.2d 332, 338, 294 N.W.2d 473, 476-77 (1980).
Whether the doctrine of issue or claim preclusion bars an action is a question of law. DePratt v. West Bend Mut. Ins. Co., 113 Wis.2d 306, 310, 334 N.W.2d 883, 885 (1983); Landess v. Schmidt, 115 Wis.2d 186, 191, 340 N.W.2d 213, 216 (Ct.App.1983). We review a question of law de novo, without deference to the trial court's determinations. DePratt, 113 Wis.2d at 310, 334 N.W.2d at 885.
Patricia contends her misrepresentation suit against John is not barred by the doctrine of issue preclusion. She argues that application of the issue preclusion doctrine is fundamentally unfair and inequitable because she did not obtain a full and fair adjudication of the misrepresentation issue in the divorce proceedings, which included her motion to reopen. In addition, she argues there was a significant difference in the quality and extensiveness of the divorce proceedings and her subsequent suit for misrepresentation. 3 We are not persuaded.
Issue preclusion applies where the matter raised in the second suit is identical in all respects to that decided in the first proceeding and where the controlling facts and applicable legal rules remain unchanged. Moore v. LIRC, 175 Wis.2d 561, 567, 499 N.W.2d 288, 290 (Ct.App.1993). Issue preclusion is a doctrine designed to limit the relitigation of issues that have been contested in a previous action between the same parties. Michelle T. v. Crozier, 173 Wis.2d 681, 687, 495 N.W.2d 327, 329 (1993). It is well accepted that the doctrine of issue preclusion may be used defensively to prevent a plaintiff from relitigating an issue decided in a prior litigation. Id. at 698, 495 N.W.2d 327, 495 N.W.2d at 335. "[W]hether the use of a prior adjudication is appropriate to preclude an issue for determination in a second forum is dependent upon conformance with principles of fundamental fairness." Id.
When determining whether to apply the doctrine of issue preclusion, the court may consider some or all of the following factors to protect the rights of all parties to a full and fair adjudication of all issues involved in the action: (1) could the party against whom preclusion is sought, as a matter of law, have obtained review of the judgment; (2) is the question one of law that involves two distinct claims or intervening contextual shifts in the law; (3) do significant differences in the quality or extensiveness of proceedings between the two courts warrant relitigation of the issue; (4) have the burdens of persuasion shifted such that the party seeking preclusion had a lower burden of persuasion in the first trial than in the second; or (5) are matters of public policy and individual circumstances involved that would render the application of issue preclusion to be fundamentally unfair, including an inadequate opportunity or incentive to obtain a full and fair adjudication in the initial action? Id. at 688-89, 495 N.W.2d at 330.
The trial court determined that Patricia failed to present evidence sufficient to grant her motion to reopen the divorce judgment under either § 806.07, STATS., or under § 767.27(5), STATS. Section 806.07 allows a party to be relieved from a judgment, order or stipulation on the grounds of mistake, inadvertence, surprise or excusable neglect, or based on the fraud, misrepresentation, or other misconduct of an adverse party. See §§ 806.07(1)(a) and (c), STATS. A motion for such relief, however, must be brought not more than one year after the judgment was entered or the order or stipulation was made. See § 806.07(2), STATS. The trial court found that Patricia's choice in the course of the divorce proceedings and negotiations not to check on the status and value of certain assets was, at most, mistake or excusable neglect under § 806.07(1) but, nevertheless, was not timely under § 806.07(2).
The trial court also considered whether Patricia had a viable misrepresentation claim under § 767.27(5), STATS. That section allows a party to petition the trial court for the creation of a constructive trust if the adverse party has deliberately or negligently failed to disclose an asset required to be disclosed under § 767.27(1) and, as a consequence of the failure to disclose, an asset with a fair market value of more than $500 has been omitted from the final distribution of property. See § 767.27(5), STATS. Such a petition may be brought at any time. Id. The trial court found Patricia had failed to submit any evidence substantiating her claims that John made misrepresentations of value of assets during the divorce proceedings and therefore concluded she was not entitled to relief under § 767.27(5).
Issue preclusion is applicable here because the issue of whether John made misrepresentations was contested in the divorce proceedings, and Patricia's claims in the misrepresentation suit are identical to the claims she set forth in her motion to reopen. 4 Furthermore, the other facts we may consider also support application of issue preclusion in this case.
First, Patricia could have obtained review of the trial court's denial of her motion to reopen in the divorce proceedings. 5 Second, there is not a significant difference between the quality and extensiveness of her motion to reopen and her misrepresentation suit to warrant relitigation of the asset values. Patricia claims the trial court's denial of her motion to reopen prevented her from continuing to the discovery stage of proceedings that would allow her to more fully develop the facts she needed to show the extent of John's misrepresentations. She argues she should not now be prevented from pursuing her misrepresentation claims on the basis of the trial court's decision. Patricia fails to appreciate that the trial court determined her assertions of misrepresentations in the motion to reopen were insufficient to allow her to proceed to the discovery stage. During the divorce proceedings, both parties had ample opportunity to conduct discovery regarding marital assets before deciding to enter into a marital settlement agreement. The evidence at the default divorce hearing was that John's net worth was anywhere between zero and $531,000, that Patricia was aware of the discrepancies at that time, and voluntarily decided to enter into the marital settlement agreement. Her later attempt to resurrect the issue of the valuation of assets in her motion to reopen the divorce judgment based on John's alleged misrepresentations of value was considered and rejected by the trial court as being without merit.
Last, Patricia argues that application of issue preclusion is fundamentally unfair because of the public policy that parties should not be allowed to make misrepresentations with impunity, and because of her individual circumstances included the fact that she did not have an adequate opportunity to obtain a full and fair adjudication in the divorce action. We are not persuaded. Patricia did have a complete opportunity to pursue discovery of John's financial status during the divorce proceedings. She chose to enter into a marital settlement agreement rather than litigate the matter to the court, knowing that John's financial status had not...
To continue reading
Request your trial