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COURT OF APPEALS
NOTICE
DECISION
DATED AND FILED                                        This opinion is subject to further editing.   If
published, the official version will appear in
the bound volume of the Official Reports.
December 22, 2009
A party may file with the Supreme Court a
David R. Schanker                                      petition to review an adverse decision by the
Clerk of Court of Appeals                              Court of Appeals.   See WIS. STAT. § 808.10
and RULE 809.62.
Cir. Ct. Nos.   2004CV5852
Appeal Nos.                                            2006AP1229
2006AP2512
2007AP369
STATE OF WISCONSIN                                     IN COURT OF APPEALS
DISTRICT I
Appeal No. 2006AP1229
BRYAN CASPER, SUSAN CASPER, MICHAEL CASPER,
THOMAS CASPER, SARA JANEY AND SHARON JANEY,
PLAINTIFFS-RESPONDENTS,
BLUE CROSS BLUE SHIELD UNITED OF WISCONSIN,
PRIMAX RECOVERIES, INC., ALLSTATE INSURANCE COMPANY,
AMERICAN FAMILY MUTUAL INSURANCE COMPANY AND
MILWAUKEE COUNTY DEPARTMENT OF HEALTH & SOCIAL
SERVICES,
INVOLUNTARY-PLAINTIFFS,
V.
AMERICAN INTERNATIONAL SOUTH INSURANCE COMPANY,
MARK WEARING, BESTWAY SYSTEMS, INC., RJW, INC.,
TRANSPORT LEASING/CONTRACT, INC., APPLIED INDUSTRIAL
TECHNOLOGIES, INC., JEFFREY E. WENHAM, UNITED STATES
FIDELITY AND GUARANTY COMPANY, FEDERAL INSURANCE




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COMPANY, CONTINENTAL CASUALTY COMPANY, JOHN DOE,
DEFENDANTS,
OLD REPUBLIC INSURANCE COMPANY AND RYDER
TRUCK RENTAL, INC.,
DEFENDANTS-APPELLANTS.
Appeal No. 2006AP2512
BLUE CROSS BLUE SHIELD UNITED OF WISCONSIN,
PRIMAX RECOVERIES, INC., ALLSTATE INSURANCE COMPANY,
AMERICAN FAMILY MUTUAL INSURANCE COMPANY AND
MILWAUKEE COUNTY DEPARTMENT OF HEALTH & SOCIAL
SERVICES,
INVOLUNTARY-PLAINTIFFS,
SARA JANEY, A MINOR, BY HER GUARDIAN AD LITEM,
SHARON JANEY, SUSAN CASPER, THOMAS CASPER,
A MINOR, BY HIS GUARDIAN AD LITEM, BRYAN CASPER
AND MICHAEL CASPER, A MINOR, BY HIS GUARDIAN AD LITEM,
PLAINTIFFS-APPELLANTS,
V.
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, P.A.,
DEFENDANT-RESPONDENT,
AMERICAN INTERNATIONAL SOUTH INSURANCE COMPANY,
MARK WEARING, BESTWAY SYSTEMS, INC., RJW, INC.,
TRANSPORT LEASING/CONTRACT, INC., APPLIED INDUSTRIAL
TECHNOLOGIES, INC., JEFFREY E. WENHAM, RYDER TRUCK
RENTAL, INC., OLD REPUBLIC INSURANCE COMPANY,
UNITED STATES FIDELITY AND GUARANTY COMPANY, FEDERAL
INSURANCE COMPANY, CONTINENTAL CASUALTY COMPANY
AND JOHN DOE,
DEFENDANTS.
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Appeal No. 2007AP369
BRYAN CASPER, SUSAN CASPER, MICHAEL CASPER,
A MINOR, BY HIS GUARDIAN AD LITEM, THOMAS CASPER,
A MINOR, BY HIS GUARDIAN AD LITEM, SARA JANEY, A MINOR,
BY HER GUARDIAN AD LITEM AND SHARON JANEY,
PLAINTIFFS-RESPONDENTS,
BLUE CROSS BLUE SHIELD UNITED OF WISCONSIN,
PRIMAX RECOVERIES, INC., ALLSTATE INSURANCE COMPANY,
AMERICAN FAMILY MUTUAL INSURANCE COMPANY AND
MILWAUKEE COUNTY DEPARTMENT OF HEALTH & SOCIAL SERVICES,
INVOLUNTARY-PLAINTIFFS,
V.
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, P.A.,
AMERICAN INTERNATIONAL SOUTH INSURANCE COMPANY, MARK
WEARING, BESTWAY SYSTEMS, INC., RJW, INC., TRANSPORT
LEASING/CONTRACT, INC., APPLIED INDUSTRIAL TECHNOLOGIES,
INC., RYDER TRUCK RENTAL, INC., OLD REPUBLIC INSURANCE
COMPANY, UNITED STATES FIDELITY AND GUARANTY COMPANY,
FEDERAL INSURANCE COMPANY, CONTINENTAL CASUALTY COMPANY
AND JOHN DOE,
DEFENDANTS,
JEFFREY E. WENHAM,
DEFENDANT-APPELLANT.
APPEALS from orders of the circuit court for Milwaukee County:
CHRISTOPHER R. FOLEY, Judge.   Affirmed in part; reversed in part and cause
remanded with directions.
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Before Fine, Kessler and Brennan, JJ.
¶1                                                                                                     BRENNAN,  J.      This  consolidated  case  arises  out  of  an  action
commenced following a collision between the Casper family’s minivan and a
truck driven by Mark Wearing in the course of his employment.   There are three
separate appeals pending before us:                                                                    (1) the Casper family’s appeal of the circuit
court’s order denying its motion for default judgment and granting National Union
Fire  Insurance  Company  of  Pittsburgh,  P.A.’s  (“National  Union”)  motion  for
summary judgment;  (2) Ryder Truck Rental, Inc.  (“Ryder”) and Old Republic
Insurance Company’s (“ORIC”) appeal of the circuit court’s denial of their motion
for summary judgment; and  (3) Jeffrey Wenham’s appeal of the circuit court’s
order  reinstating  the  Casper  family’s  negligence  claim  against  him  as  an
individual.1   For the reasons which follow, we affirm the circuit court’s first and
third orders above and reverse the second.
BACKGROUND
¶2                                                                                                     In May 2003, the Casper family and Sara Janey (the girlfriend of the
Caspers’ oldest son, Michael Casper) were taking a family trip from the Casper
family’s home in Sheboygan to Milwaukee.   At the intersection of 51st Street and
Brown  Deer  Road,  while  the  Casper  family’s  minivan  was  stopped  at  an
1  All three appeals arise from Milwaukee County Circuit Court Case No. 2004CV5852.
Each appellant filed a petition for leave to appeal a nonfinal order of the circuit court.   In each
instance, the petition was granted.  See WIS. STAT. § 808.03(2) (2007-08).
All references to the Wisconsin Statutes are to the 2007-08 version unless otherwise
noted.
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intersection,  Wearing  slammed  his  truck  into  the  rear  of  the  minivan  at
approximately forty to forty-five miles per hour.
¶3                                                                                   As a result of the collision, Michael is now a quadriplegic.   Janey
suffered, among other injuries, a traumatic brain injury, multiple leg and pelvis
fractures, and one of her kidneys no longer functions.   Bryan, Susan, and Thomas
Casper suffered lesser, but still serious injuries.
¶4                                                                                   At the time of the accident, Wearing was co-employed by Transport
Leasing/Contract, Inc. (“TLC”) and Bestway Systems, Inc. (“Bestway”), and the
truck he was driving had been leased to Bestway by Ryder.   The Caspers and
Janey filed suit (collectively, “the Caspers” or “the Casper family”).
DISCUSSION
I.                                                                                   The Casper Family’s Appeal
¶5                                                                                   The Caspers appeal the circuit court’s orders:                          (1) granting National
Union’s motion to extend time to answer and denying the Caspers’ motion for
default  judgment  against  National  Union;  and                                    (2) granting  National  Union’s
motion for summary judgment on the Caspers’ direct action claims.   We affirm the
circuit court.
A.                                                                                   Facts
¶6                                                                                   The Caspers filed suit against National Union as an insurer of one of
Wearing’s  co-employers,  TLC.    The  Caspers  served  National  Union  with  an
authenticated copy of the Fifth Amended Summons and Complaint, on May 5,
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2006.   On June 20, 2006, after National Union failed to answer the complaint by
the deadline imposed by WIS. STAT. § 802.06(1),2 the Caspers moved for default
judgment against National Union.    On June  26,  2006, National Union filed its
answer, albeit untimely, and moved to enlarge time for filing the answer.
¶7                                                                                            In its motion to enlarge time, National Union alleged that the Fifth
Amended Complaint was received by Lynn Weisinger, a division counsel in the
Claims  Litigation  Unit  of  National  Union’s  parent  company,  AIG,  located  in
Jersey  City,  New  Jersey.    AIG’s  Claims  Litigation  Unit  is  responsible  for
coordinating  and  administering  all  legal  documents  served  domestically  on
authorized  agents  of  AIG’s  member  insurance  companies,  including  National
Union.   Upon receiving the complaint, Weisinger followed specific procedures to
administer and coordinate the handling of these legal documents.   After reviewing
the  complaint,  Weisinger  determined  that  it  should  be  handled  by  Charles
Lanphear  in  Atlanta,  Georgia,  a  claims  specialist  handling  truck  liability.
Weisinger sent the complaint by U.S. Mail to Lanphear on May 16, 2006, more
than  thirty  days  before  the  answer  was  due.    Lanphear  never  received  the
complaint.   Consequently, because he had no knowledge that National Union had
been added to the lawsuit, Lanphear did not arrange for an answer to be filed on
National Union’s behalf.
2  WISCONSIN STAT. § 802.06(1) states, in pertinent part, that “[i]f a defendant in the
action is an insurance company … the periods of time to serve a reply or answer shall be 45
days.”
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¶8                                                                                       The  circuit  court  found  that  National  Union’s  failure  to  file  its
answer in a timely manner was excusable neglect under WIS. STAT. § 801.15(2)(a)
and subsequently granted National Union’s motion to enlarge time and denied the
Caspers’ motion for default judgment.
¶9                                                                                       After the circuit court granted National Union’s motion to enlarge
time to answer, National Union filed a motion for summary judgment with respect
to the Caspers’ WIS. STAT. § 632.24 claims, commonly referred to as direct action
claims.    Following  briefing  on the  motion,  the  circuit court granted National
Union’s motion for summary judgment and dismissed the direct action claims.
¶10    The  Caspers  now  appeal  both  the  circuit  court’s  order  granting
National Union’s motion to enlarge time and denying their motion for default
judgment, and the circuit court’s order dismissing the direct action claims against
National Union.   We will address each in turn.
B.                                                                                       “Excusable Neglect”
¶11    The  Caspers  first  challenge  the  circuit  court’s  order  granting
National Union’s motion to enlarge time and denying the Caspers’ motion for
default judgment.   The Caspers allege that the circuit court erred as a matter of law
when it found that National Union’s failure to answer the complaint in a timely
fashion was due to excusable neglect.   In response, National Union contends that
the circuit court acted within its discretion.   We affirm.
¶12    On review, we will not disturb the circuit court’s decision to enlarge
the time for filing an answer and to deny default judgment unless the circuit court
erroneously exercised its discretion.   Sentry Ins. v. Royal Ins. Co., 196 Wis. 2d
907, 914, 539 N.W.2d 911 (Ct. App. 1995).   We must affirm the circuit court’s
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decision  so  long  as  it                                                                 “represents  a  proper  application  of  the  law  and  is  a
determination that a reasonable judge could have reached.”   Id.   We do not test the
circuit court’s discretionary decision “by our sense of what might be a ‘right’ or
‘wrong’ decision in the case.   Rather, the [circuit court’s] determination will stand
‘unless it can be said that no reasonable judge, acting on the same facts and
underlying law, could reach the same conclusion.’”   Olivarez v. Unitrin Prop. &
Cas. Ins. Co., 2006 WI App 189, ¶16, 296 Wis. 2d 337, 723 N.W.2d 131 (citation
omitted).
¶13    In conducting our review of the circuit court’s decision to grant
National Union’s motion to enlarge time and to deny the Caspers’ motion for
default judgment, “we must examine the circuit court’s on-the-record explanation
of the reasons underlying its decision.”   See id., ¶17.  The circuit court’s “[r]easons
must be stated, but ‘need not be exhaustive.’”   See id. (citation omitted).   And
“[b]ecause the exercise of discretion is so essential to a circuit court’s functioning,
we will search the record for reasons to sustain its exercise of discretion.”   See id.
(citation omitted).    As long as the circuit court properly applied the law and
reached a determination that a reasonable judge could have reached, we must
affirm the decision on appeal even if the decision is one that would not have been
made by the members of this court.  See Sentry Ins., 196 Wis. 2d at 914.
¶14    When  determining  whether  to  grant  National  Union’s  motion  to
enlarge time, the circuit court needed to consider:                                        (1) whether National Union’s
“noncompliance was due to excusable neglect,” and (2) whether “an enlargement
of time would serve the interests of justice; that is, whether the party seeking relief
acted in good faith and whether the opposing party would be prejudiced by the
time delay.”   See id. at 915.
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¶15                                                                                          “Excusable neglect is not synonymous with neglect, carelessness or
inattentiveness.   Rather, excusable neglect is that neglect which might have been
the act of a reasonably prudent person under the circumstances.”    Id.  (citation
omitted).   When considering the “interests of justice,” the circuit court “must be
cognizant that denial of a motion for enlargement of time to answer may result in a
default  judgment  in  favor  of  the  plaintiff”  and  that  the                            “law  views  default
judgments with disfavor.”   Hedtcke v. Sentry Ins. Co., 109 Wis. 2d 461, 469, 326
N.W.2d 727 (1982).   “On the other hand, the circuit court should also be aware of
the party’s and society’s interest in prompt adjudication and ‘the probability that a
policy  which  excused  or  tolerated  a  lawyer’s  neglect  would  foster  delay  in
litigation’ and lower the quality of legal representation.”   Id. (citation omitted).   So
long  as  the  circuit  court  properly  applied  this  law  and  reached  a  decision  a
reasonable judge could reach, we cannot reverse its decision.
¶16    When  denying  the  Caspers’  motion  for  default  judgment  and
granting  National  Union’s  motion  to  enlarge  time,  the  circuit  court  held  as
follows:
I’m denying the motion, default judgment, and granting the
motion  to  enlarge  time  to  answer.    I  believe  that  the
affidavits  of  this  Mr.  Lanphear  and  Miss  Weisinger  …
establish excusable neglect in failure to timely answer and
a [sic] good faith and prompt efforts to rectify the oversight
when it was discovered.
It  appears  that  despite  the  carefully  structured
process to assure timely answers to the legal process that
timely answers to the legal process were filed, and they
have a process that attempts to assure timely answer to the
legal  process  most  likely  based  upon  the  affidavit;  it
appears that correspondence was lost and that resulted in a
less than timely answer.    Under  [Sentry Insurance,  196
Wis. 2d                                                                                      907,]  I  certainly  believe  that  this  constitutes
excusable neglect.
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I’ll also note in passing as everybody knows that the
law disfavors default judgment and strongly presumes that
parties  should  be  given  their  opportunity  to  litigate  the
merits  of  the  case.    I  don’t  see  a  significant  bias  or
prejudice to the Caspers.
I do note that we’re dealing with a fifth amended
complaint ….
But on the basis of the rationale that I put forth first
I’m granting their motion to enlarge time to answer and
denying the motion for default judgment.
¶17    The Caspers take issue with the circuit court’s finding that National
Union’s behavior constituted excusable neglect.   In particular, the Caspers argue
that the circuit court erred in finding that Sentry Insurance governs the facts of
this case.   In Sentry Insurance, we upheld the circuit court’s finding of excusable
neglect after the defendant, an insurance company, alleged that it failed to timely
answer a complaint because it inadvertently attached the summons and complaint
to the pre-suit file and sent the pre-suit file off for duplication.   Id., 196 Wis. 2d at
915-16.   It was not until the file was returned that the defendant discovered its
error and filed an answer.   Id. at 915.   We held that the circuit court acted within
its discretion when it held that a  “reasonably prudent person under the  same
circumstances could have made the same acts that caused the delay to file the
answer, and therefore the mistakes were excusable neglect.”   Id.   We explicitly
noted that “[w]hile clerical error is not always excusable, a clerk’s misrouting is
not as a matter of law inexcusable neglect.”   Id.
¶18    The Caspers would have the circuit court instead apply Mohns, Inc.
v. TCF National Bank, 2006 WI App 65, 292 Wis.  2d 243, 714 N.W.2d 245,
asserting that Mohns states that allegations that the summons and complaint were
“lost in transit” can never constitute excusable neglect.   Mohns does not stand for
such a proposition.
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¶19    Certainly, the Caspers correctly state that we reversed the circuit
court’s finding in Mohns that the defendant’s failure to file a timely answer was
excusable neglect when the defendant alleged that the summons and complaint
were “lost in transit” after the defendant’s legal department changed addresses.
See id., ¶12.   We did not reverse, however, based upon the factual basis of the
defendant’s excuse.   Instead, we reversed the circuit court’s holding because rather
than considering whether the defendant’s behavior leading up to its failure to
answer was the act of a reasonably prudent person, the circuit court looked solely
at the defendant’s behavior upon discovering its oversight.   See id., ¶¶11-12.   We
held  that                                                                                “what  the  lawyers  did  after  [the  defendant’s]  default  is   …  largely
immaterial.”   Id., ¶11.   Instead, “[t]he circuit court must consider later ‘prompt
action  combined  with  the  reasons  advanced  by  the  dilatory  party  for  the
omission.’”   Id. (citation omitted).   We fail to find that the circuit court made the
same misstep here.
¶20    Unlike the circuit court in Mohns, which never considered why the
defendant failed to promptly file its answer, the circuit court here looked to the
procedures that National Union had in place to avoid these types of mishaps.   The
circuit  court  explicitly  noted  that  National  Union  had  in  place  a               “carefully
structured process to  assure timely answers,” but that despite that process  “it
appears that correspondence was lost.”   In so noting, the circuit court implicitly
determined the oversight was one that could be attributed to a “reasonably prudent
person” and determined that the oversight in this instance was akin to the clerical
error found to be excusable neglect in Sentry Insurance.
¶21    The  circuit  court  also  properly  took  into  consideration  how  an
enlargement of time or a default judgment would “serve the interests of justice,”
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citing National Union’s  “good faith and prompt efforts to rectify the oversight
when it was discovered.”   See Sentry Ins., 196 Wis. 2d at 915.   Further, the court
noted that because the answer was filed only two days after its due date, that the
Caspers were not significantly “bias[ed] or prejudice[d]” by the delay.
¶22    Accordingly, we find this case to be more like Sentry Insurance
than Mohns and do not find that the circuit court erred in exercising its discretion
when it granted National Union’s motion to enlarge time and correspondingly
denied the Caspers’ motion for default judgment.
C.                                                                                       Wisconsin’s Direct Action Statute, WIS. STAT. § 632.24
¶23    The  Caspers  next  appeal  the  circuit  court’s  decision  to  grant
National Union’s summary judgment motion, dismissing the Caspers’ WIS. STAT.
§ 632.24  claims,  commonly referred to as  direct action claims.    The  Caspers
contend that the circuit court erroneously held that the direct action statute did not
apply to the insurance policy between National Union and TLC because the policy
was not delivered or issued for delivery in Wisconsin.   National Union alleges that
the circuit court properly interpreted the law and granted National Union’s motion
for summary judgment.   We affirm.
¶24    Summary judgment is appropriate when there is no material factual
dispute  and  the  moving  party  is  entitled  to  judgment  as  a  matter  of  law.
Germanotta v. National Indem. Co., 119 Wis. 2d 293, 296, 349 N.W.2d 733 (Ct.
App. 1984).   In an appeal from a grant of summary judgment, our review is de
novo, applying the same methodology as the circuit court.    See Green Spring
Farms v. Kersten, 136 Wis. 2d 304, 315-17, 401 N.W.2d 816 (1987).
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¶25    WISCONSIN STAT.  § 632.243 allows a party to assert a negligence
claim directly against an insurance company, in certain instances, irrespective of
whether the insured has yet been found liable by a final judgment.   The right to
maintain a direct action claim under § 632.24 is limited by the restrictions set forth
in WIS. STAT. § 631.01(1).   See Arnold P. Anderson, WISCONSIN INSURANCE LAW
§ 11.105 (5th ed. 2004).  Section 631.01(1) states, in pertinent part:
3  A direct action is brought under a statutory scheme including both a substantive and
procedural component.   Arnold P. Anderson, WISCONSIN  INSURANCE  LAW § 11.105 (5th ed.
2004).  The substantive portion is included in WIS. STAT. § 632.24 and provides:
Direct action against insurer.   Any bond or policy of
insurance covering liability to others for negligence makes the
insurer liable, up to the amounts stated in the bond or policy, to
the persons entitled to recover against the insured for the death
of any person or for injury to persons or property, irrespective of
whether the liability is presently established or is contingent and
to become fixed or certain by final judgment against the insured.
The procedural portion is included in WIS. STAT. § 803.04(2)(a) and provides:
Permissive joinder of parties.   …
(2)    NEGLIGENCE  ACTIONS:    INSURERS.                                                  (a)    In any
action for damages caused by negligence, any insurer which has
an interest in the outcome of such controversy adverse to the
plaintiff or any of the parties to such controversy, or which by its
policy of insurance assumes or reserves the right to control the
prosecution, defense or settlement of the claim or action, or
which by its policy agrees to prosecute or defend the action
brought by plaintiff or any of the parties to such action, or agrees
to engage counsel to prosecute or defend said action or agrees to
pay the costs of such litigation, is by this section made a proper
party defendant in any action brought by plaintiff in this state on
account  of  any  claim against  the  insured.    If  the  policy  of
insurance was issued or delivered outside this state, the insurer is
by this paragraph made a proper party defendant only if the
accident, injury or negligence occurred in this state.
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Application  of  statutes.                                                                 (1)                                                                        GENERAL.    This
chapter  and  ch.  632  apply to  all  insurance  policies  and
group certificates delivered or issued for delivery in this
state,  on  property  ordinarily  located  in  this  state,  on
persons residing in this state when the  policy  or group
certificate  is  issued,  or  on  business  operations  in  this
state ….
(Emphasis added.)
¶26    The Caspers contend that under the plain language of WIS. STAT.
§§ 632.24 and 631.01(1) they can bring a direct action suit against National Union
because it insured TLC’s business operations in this state.   The Caspers argue that
under the plain language of § 631.01(1), the direct action statute applies to polices:
(1) delivered or issued for delivery in this state; (2) on property ordinarily located
in  this  state;                                                                           (3) on  persons  residing  in  this  state  when  the  policy  or  group
certificate is issued; or (4) on business operations in this state.   Accordingly, based
on their interpretation of the statute’s plain language, the Caspers contend that the
circuit court erred in holding that § 631.01(1) requires that a policy be “delivered
or issued for delivery in this state,” when a policy could also implicate the statute
by satisfying any of the other three conditions.
¶27    National Union counters that the circuit court properly applied the
law when it dismissed the Caspers’ direct action claims because in Kenison v.
Wellington Insurance Co., 218 Wis. 2d 700, 582 N.W.2d 69 (Ct. App. 1998), this
court  already  determined  that  the  plain  language  of  WIS.  STAT.                    § 631.01(1)
requires that a policy be  “delivered or issued for delivery in this state.”    See
Kenison, 218 Wis. 2d at 710.
¶28    In Kenison, we addressed exactly the issue raised in this case and
concluded that “the unambiguous language of [WIS. STAT. § 631.01(1)] limits the
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application of [WIS. STAT. § 632.24] to insurance policies delivered or issued for
delivery  in                                                                           [Wisconsin].”    See  Kenison,  218  Wis.  2d  at  710.    The  Caspers’
contention that the statute should be interpreted differently is in direct conflict
with our prior case law.   Even if we agreed with the Caspers, we are without the
authority to modify, withdraw, or otherwise change our prior case law.   See Cook
v. Cook, 208 Wis. 2d 166, 189-90, 560 N.W.2d 246 (1997).
¶29    Accordingly, the circuit court properly relied upon Kenison for the
proposition that the policy must be issued or delivered in Wisconsin before the
Caspers   could   avail   themselves   of   Wisconsin’s   direct   action   statute.
Consequently,  because  it remains undisputed that the  policy at issue was not
issued or delivered in Wisconsin, we affirm the circuit court.
II.                                                                                    Ryder/ORIC Appeal
¶30    Ryder  and  its  insurer,  ORIC,  appeal  the  circuit  court’s  decision
denying their motion for summary judgment.4   They argue that the circuit court
erred in holding that:                                                                 (1) the MCS-90 endorsement in the Ryder-ORIC policy
applies and allows the Caspers to collect from ORIC a judgment rendered against
Wearing  for  negligence;  and                                                         (2) material  issues  of  fact  exist  as  to  which
Wisconsin financial responsibility statute applies, WIS. STAT. §§ 344.51 or 344.52.
Ryder and ORIC further contend that, although the circuit court did not address
the  issue,  presumably  because  the  court  found  that  the  MCS-90  endorsement
allowed the Caspers to collect a judgment from ORIC, the Wisconsin omnibus
4  As previously noted, we review a circuit’s decision on summary judgment de novo.
See Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315-17, 401 N.W.2d 816 (1987).
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statute, WIS. STAT.  § 632.32, does not make the Caspers an insured under the
Ryder-ORIC policy.5   We reverse.
A.                                                                                                Facts
¶31    At  the  time  of  the  accident,  Ryder  owned  the  truck  driven  by
Wearing.    Ryder  leased  the  truck  to  Bestway,  Wearing’s  employer,  under  a
commercial  lease.    Per  the  lease  agreement,  Bestway  was  to  obtain  liability
insurance to cover the truck and to name Ryder as an additional insured on that
policy.     Bestway  complied,  obtaining  an  insurance  policy  from  American
International South Insurance Company (“AIS”) with a $1,000,000 coverage limit.
The Bestway-AIS policy also contains an MCS-90 endorsement, which satisfies
federal regulations by verifying that Bestway can pay a final judgment recovered
against it for up to $750,000.
¶32    Ryder  was  also  the  named insured on  its  own  insurance  policy,
issued  by  ORIC.    Ryder  is  the  only  named  insured  on  that  policy.    The
Ryder-ORIC policy explicitly states that it does not provide coverage to lessees of
Ryder-owned vehicles  (i.e., Bestway) unless the lessee specifically elects such
coverage through its lease agreement with Ryder.   The lease agreement between
Ryder and Bestway contains no such election, and in fact, requires Bestway, and
not Ryder, to obtain liability coverage.   The Ryder-ORIC policy also contains an
MCS-90 endorsement.
5  Ryder and ORIC also dedicate a portion of their brief to asking us to uphold the circuit
court’s dismissal of the common law negligence claims against them.  Because the Caspers do not
appeal the circuit court’s decision in that regard, we decline to address the issue.
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¶33    The Caspers filed suit against Ryder and ORIC, alleging that Ryder
and  ORIC  are  liable  for  Wearing’s  negligence.    Ryder  and  ORIC  filed  for
summary judgment, contesting four potential avenues for their liability:                              (1) the
common law; (2) the MCS-90 endorsement included in Ryder’s insurance policy
issued by ORIC;  (3) the Wisconsin omnibus statute, WIS. STAT.  § 632.32; and
(4) the  Wisconsin  financial  responsibility  statutes,  WIS.  STAT.                                 §§ 344.51  or
344.52.   The circuit court held as follows:                                                          (1) that the Caspers had conceded that
no common law claim could be maintained against Ryder and ORIC; (2) that the
MCS-90 endorsement in Ryder’s insurance policy allows the Caspers to recover
from ORIC a  judgment against  Wearing for  negligence;  and  (3) that  material
issues of fact existed as to which financial responsibility statute applied, §§ 344.51
or  344.52.    The circuit court did not address Ryder and ORIC’s liability with
respect to Wisconsin’s omnibus statute,  § 632.32, presumably because it found
that the MSC-90 endorsement allows the Caspers to collect a judgment from
ORIC.  Ryder and ORIC appeal.
B.                                                                                                    The MCS-90 Endorsement
¶34    ORIC first argues that the circuit court erred in holding that the
MCS-90 endorsement in the Ryder-ORIC policy allows the Caspers to collect
from ORIC a judgment rendered against Wearing for negligence.6    The circuit
court held that while other “endorsements in the policy clearly exclude coverage
6  We note at the outset that interpretation of the MCS-90 endorsement is a question of
federal rather than state law.   On federal questions, this court is bound only by the decisions of
the United States Supreme Court.   See Thompson v. Village of Hales Corners, 115 Wis. 2d 289,
307, 340 N.W.2d 704 (1983).   The value of the opinions of federal courts of appeals and district
courts is limited to their persuasiveness.  See id.
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for Wearing … the MCS[-]90 [endorsement] renders ineffectual those exclusions
and,  by operation  of  law,  qualifies  Wearing  as  an  insured  under  the  [ORIC]
policy.”   We reverse.
¶35    The Motor Carrier Act of 1980, 49 U.S.C. § 10101 et seq., and the
subsequent  regulations  promulgated  by  the  Federal  Motor  Carrier  Safety
Administration  (“FMCSA”),  require  certain  interstate  motor  carriers  to  obtain
liability  insurance,  guaranteeing  their  financial  responsibility  for  the  motor
carriers’ negligent acts up to the amount prescribed by statute.7   The legislation
was, in part, intended to address “‘abuses that had arisen in the interstate trucking
industry which threatened public safety, including the use by motor carriers of
leased or borrowed vehicles to avoid financial responsibility for accidents that
occurred while goods were being transported in interstate commerce.’”   Carolina
Cas. Ins. Co. v. Yeates, 584 F.3d 868, 873 (10th Cir. 2009) (en banc) (citations
omitted).
¶36    The  law  further  requires  proof  of  such  insurance,  consisting  of
either:                                                                                            (1) an MCS-90 endorsement issued by an insurer; (2) an MCS-82 bond
issued by a surety; or (3) a written decision, order, or authorization of the FMCSA
authorizing a motor carrier to self-insure.   See 49 C.F.R. § 387.7(a), (d) (2009).   In
this case, both Ryder and Bestway elected to utilize the MCS-90 endorsement
provided  in  the  regulations.    The  MCS-90  endorsement  attaches  to  a  motor
7  More  specifically,  a                                                                          “for-hire”  motor  carrier  hauling  nonhazardous  property  in
interstate or foreign commerce, with a gross vehicle weight of 10,001 or more pounds, requires a
motor carrier to obtain a $750,000 policy.  See 49 C.F.R. § 387.9(1) (2009).
The parties agree that $750,000 is the statutory minimum applicable in this case.
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carrier’s liability policy and explicitly states that “[i]t is understood and agreed
that no condition, provision, stipulation, or limitation … shall relieve the company
from liability or from the payment of any final judgment.”   Yet, the endorsement
also states that “all terms, conditions, and limitations in the policy to which the
endorsement is attached shall remain in full force and effect as binding between
the insured and the company.”   See 49 C.F.R. § 387.15, Illustration I (2009).
¶37    The   Ryder-ORIC   policy   explicitly   excludes   from   coverage
“lessee/renter  [Bestway and], his agents or employee  [Wearing],”  “[u]nless the
lease/rental agreement states in writing that such lessee/renter is to be provided
with automobile liability insurance.”8    The lease between Ryder and Bestway
provides no such requirement.   To the contrary, the lease executed between Ryder
and Bestway requires Bestway, not Ryder, to maintain a liability policy for at least
$1,000,000.
¶38    The Caspers contend, and the circuit court agreed, that the MCS-90
endorsement  included  in  the  Ryder-ORIC  policy  overrides  the  exclusion  for
lessees.   In so holding, the circuit court relied exclusively on Lynch v. Yob, 768
N.E.2d 1158 (Ohio  2002), which held that “MCS-90 endorsement[s] should be
8  The policy’s exclusion for lessees and renters is included in  “Endorsement C-7,”
entitled “Driverless Autos.”   On appeal, the Caspers argue that Ryder and ORIC “failed to make
any argument regarding [the] C-7 endorsement on the summary judgment motion,” and therefore,
they argue that Ryder and ORIC have waived their right to raise the language on appeal.   See
State v. Huebner, 2000 WI 59, ¶10, 235 Wis. 2d 486, 611 N.W.2d 727 (“It is a fundamental
principle of appellate review that issues must be preserved at the circuit court.”).  While we agree
with the Caspers that issues not raised before the circuit court are waived, we disagree on whether
this particular issue was raised below.   In their brief before the circuit court, Ryder and ORIC not
only cite to Endorsement C-7, but they include the endorsement’s language in its entirety in their
brief and state that Endorsement C-7 “preclude[s] any coverage for this loss under the [Ryder-
ORIC] policy.”  Therefore, the argument was not waived.
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read to eliminate any limiting clauses in the underlying policy restricting the scope
of coverage.”   See id. at 1163.   We decline to follow the Ohio Supreme Court’s
holding in Lynch.
¶39    In Lynch, the Ohio Supreme Court, purportedly relying on the Ninth
Circuit Court of Appeals’ decision in John Deere Ins. Co. v. Nueva, 229 F.3d
853,  859  (9th Cir.  2000), and the Tenth Circuit Court of Appeals’ decision in
Adams v. Royal Indem. Co., 99 F.3d 964, 971 (10th Cir. 1996), allowed a plaintiff
to recover from two insurance companies even though recovery from the first
company  exceeded  the  federal  statutory  minimum  and  the  second  company’s
policy did not cover the accident at issue.   Lynch, 768 N.E.2d at 1162-63.   The
plaintiff  in  Lynch,  who  was  injured  in  a  tractor-trailer  accident,  recovered
$1,000,000 from the tractor’s insurer under the terms of the tractor’s insurance
policy.   Id. at 1159.   The Ohio Supreme Court then allowed the plaintiff to recover
additional monies against the trailer’s insurer even though the driver of the tractor
was not covered under the trailer’s insurance policy.   See id. at 1159-60, 1165.
The court held that the attachment of the MCS-90 endorsement to the trailer’s
policy negated any limiting clauses in the underlying policy.   See id. at 1163.
¶40    By  allowing  the  plaintiff  to  recover  against  two  insurers,  even
though the first insurer satisfied the minimum requirements of the federal statutory
scheme, the Ohio Supreme Court expanded the holdings in John Deere and Royal
beyond their scope and contravened the purpose of the Motor Carrier Act.   See
John Deere,  229 F.3d at  854,  860  (allowing recovery from the insurer of the
trailer  in  a  tractor-trailer  accident,  even  though  the  policy  did  not  cover  the
accident, because the policy included an MCS-90 endorsement and no other party
involved was insured); Royal, 99 F.3d at 965, 971 (same).   In neither John Deere
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nor Royal did a court allow a party to recover against a second insurance company
when the federal minimum for recovery was already satisfied, as Lynch reads the
cases to allow.   See Lynch, 768 N.E.2d 1158.   To allow recovery in that instance
obligates insurers beyond what the law requires and beyond the negotiated terms
of the policy between the insurer and the insured.   We find the better reasoned rule
to be the one articulated in Yeates, and we adopt that rule here.   See Yeates, 584
F.3d at 871.
¶41    In Yeates, addressing a factual scenario similar to our own, the Tenth
Circuit Court of Appeals, sitting en banc, held that:
the  MCS-90  endorsement  only  applies  where:                                         (1) the
underlying insurance policy to which the endorsement is
attached does not provide coverage for the motor carrier’s
accident, and (2) the motor carrier’s insurance coverage is
either  not  sufficient  to  satisfy  the  federally-prescribed
minimum   levels   of   financial   responsibility   or   is
non-existent.
Id.; see also Kline v. Gulf Ins. Co., 466 F.3d 450, 455-56 (6th Cir. 2006); Minter
v. Great Am. Ins. Co. of N.Y., 423 F.3d 460, 470-71 (5th Cir. 2005).   The rule
imparted from Yeates stays true to the “‘purpose of the [MCS-90] endorsement …
to give full security for the protection of the public up to the limits prescribed.”
See Kline, 466 F.3d at 455 (citation omitted; brackets and emphasis in Kline).
¶42    Critically,  the  rule  in  Yeates  also  stays  faithful  to  the  express
language in the MCS-90 endorsement, which states that “all terms, conditions, and
limitations in the policy to which the  [MCS-90] endorsement is attached shall
remain in full force and effect as binding between the insured and the company.”
See  49  C.F.R.  § 387.15,  Illustration  I.    Thereby,  the  MCS-90  endorsement’s
language,  while  protecting  the  public,  does  not fundamentally alter  the  terms
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agreed upon and bargained for between the insured and the insurer.   The MCS-90
endorsement cannot reasonably be read to alter the terms agreed upon by the
parties to the insurance policy when the minimum level of financial responsibility
to the public has already been met.
¶43    The holding in Yeates also makes sense in light of the fact that the
MCS-90 endorsement requires the insured “to reimburse the [insurance] company
for any payment … that the [insurance] company would not have been obligated
to make under the provisions of the policy except for the agreement contained in
[the MCS-90] endorsement.”   See 49 C.F.R. § 387.15, Illustration I.   The inclusion
of the reimbursement provision in the MCS-90 endorsement creates a suretyship,
obligating an insurance company to cover a judgment for liability  “not in the
motor carrier’s stead, but to ensure a minimum level of satisfaction of a public
liability judgment.”    Yeates,  584 F.3d at  881.                                      “To accomplish the MCS-90’s
suretyship  purpose,  the  endorsement—when  triggered—reads  out                       ‘only  those
clauses in the policy that would limit the ability of a third party victim to recover
for  his  loss.’”     Id.  at                                                           883  (citations  omitted).     In  so  doing,  the  MCS-90
endorsement acts to shift the risk stemming from motor carrier vehicle accidents
from the public to the insurer, all the while continuing to hold only the motor
carrier liable for its own negligent acts up to the mandatory minimum.
¶44    Applying the rule set forth in Yeates and adopted by this court, the
Caspers cannot recover a judgment against Wearing from ORIC based on the
inclusion of the MCS-90 endorsement in the Ryder-ORIC policy because:                   (1) the
Ryder-ORIC policy does not provide coverage for the accident; and (2) Bestway’s
policy through AIS provides coverage for the accident in excess of the amount
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required by the federal regulatory scheme.   Accordingly, the decision of the circuit
court is reversed, and this issue is remanded to the circuit court for dismissal.
C.                                                                                      Wisconsin’s Omnibus Statute, WIS. STAT. § 632.32
¶45    In  their  response  to  Ryder  and  ORIC’s  motion  for  summary
judgment before the circuit court, the Caspers argued that if the court were to find
that the MCS-90 endorsement did not allow the Caspers to recover a judgment
from ORIC, that Wisconsin’s omnibus statute, WIS. STAT. § 632.32(3)(a), would
allow such a recovery.   The circuit court did not address the issue, presumably
because it found that the Caspers could recover against ORIC in the first instance.
Because the question is purely one of law and the parties addressed the issue
before the circuit court and in their respective briefs before this court, we decide
the issue now in the interest of judicial economy.   See Wirth v. Ehly, 93 Wis. 2d
433, 443-44, 287 N.W.2d 140 (1980).
¶46    The Caspers do not assert that the plain terms of the Ryder-ORIC
policy provide coverage for Bestway and Wearing, but rather they argue that
excluding Bestway and Wearing from coverage violates Wisconsin’s omnibus
statute.   See WIS. STAT. § 632.32(3)(a).   The Wisconsin omnibus statute mandates
that motor vehicle liability insurance policies issued or delivered in Wisconsin9
must provide “any person using any motor vehicle described in the policy,” who is
using the vehicle “for purposes and in the manner described in the policy,” the
same  “[c]overage provided to the named insured.”    Section  632.32(1),  (3)(a).
When a policy is inconsistent with the omnibus statute it must be reformed to
9  For purposes of this appeal, we assume that the policy was “issued or delivered in
Wisconsin” because the parties do not argue otherwise.
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comply.    WIS.  STAT.  § 631.15(4).    The  Caspers  argue  that  Wearing  was  a
permissive driver under the omnibus statute, and, therefore, the policy must be
reformed to afford Wearing the same coverage Ryder would have received under
the policy.
¶47    Ryder  and  ORIC  counter  that  the  claim  falls  within  a  statutory
exception to the omnibus statute, which states:
If the policy is issued to a motor vehicle handler, it
may restrict coverage afforded to anyone other than the
motor vehicle handler or its officers, agents or employees
to  the  limits  under                                                                        [WIS.  STAT.                                                            §] 344.01(2)(d)  and  to
instances  when  there  is  no  other  valid  and  collectible
insurance  with  at  least  those  limits  whether  the  other
insurance is primary, excess or contingent.
See WIS. STAT.  § 632.32(5)(c).    Ryder and ORIC contend that under the plain
terms of the statutory exception, the Ryder-ORIC policy excluded coverage for
Bestway and Wearing.   We agree.
¶48                                                                                           “[O]ne purpose of the omnibus coverage requirement is to afford the
additional  insured  the  same  protection  as  is  afforded  to  the  named  insured.”
Carrell v. Wolken,  173 Wis. 2d  426,  437,  496 N.W.2d  651  (Ct. App.  1992).
Noting that purpose, we presume that additional insureds may avail themselves of
a policy unless:                                                                              (1) the statute allows a restriction, like the exception set forth in
WIS. STAT. § 632.32(5)(c); and (2) the policy takes advantage of the exception by
explicitly stating how the additional insured is to be restricted.   Id.   In order to take
advantage of the exception set forth in  § 632.32(5)(c), a motor vehicle handler
must “either insert language in the policy that:                                              (1) permissive users are restricted
to the minimum statutory liability limits; or (2) the users cannot avail themselves
of the policy unless there is no other valid collectible insurance whether primary,
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excess or contingent.”   Henry v. General Cas. Co., 225 Wis. 2d 849, 866, 593
N.W.2d 913 (Ct. App. 1999).
¶49    The Ryder-ORIC policy contains the language necessary to invoke
the exception to the omnibus statute in “Endorsement C-15.”   Endorsement C-15
states as follows:
OTHER VALID AND COLLECTIBLE INSURANCE
Except  in  those  contracts  whereby  the  Named  Insured
[Ryder] has agreed to extend insurance provided under this
Policy on  a direct, primary basis to or  on behalf of its
customers, the following shall apply:
It is agreed that this Policy shall exclude coverage for any
occurrence for which other valid and collectible insurance
(either on a primary or an excess basis) is available to
cover such occurrence (including the interest of the Named
Insured), equal to the coverage and limits of this Policy.
Further it is agreed that should other valid and collectible
insurance be available with coverages and limits less than
the coverages and limits provided by this Policy, then this
Policy shall cover, but only for the difference between the
coverages and limits provided by such other Policy and the
coverages and limits provided by this Policy but only for
the liability of the Named Insured.
(Emphasis  added.)     The  emphasized  language  almost  exactly  parallels          the
language required by case law to take advantage of the statutory exception to the
omnibus statute—“the users cannot avail themselves of the policy unless there is
no other valid collectible insurance whether primary, excess or contingent.”   See
Henry, 225 Wis. 2d at 866.   Therefore, we find that the exception applies, and the
omnibus statute does not act to make Bestway and Wearing insureds under the
terms of the Ryder-ORIC policy.
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D.                                                                                        Wisconsin’s Financial Responsibility Statutes, WIS. STAT. §§ 344.51
and 344.52
¶50    Finally, ORIC and Ryder claim that the circuit court erred in finding
that a material issue of fact existed as to which Wisconsin financial responsibility
statute applies to the case—WIS. STAT.  §§ 344.51 or  344.52.   They argue that
because  the  lease  agreement  between  the  parties  was  executed  outside  of
Wisconsin,  the  foreign  financial responsibility statute,  § 344.52,  applies.    The
Caspers ask us to uphold the circuit court’s finding that a question of material fact
exists, but contend that, even if the circuit court erred in that respect, because the
contract was performed in Wisconsin, the domestic financial responsibility statute,
§ 344.51,  applies.    We  reverse  and  apply  the  foreign  financial  responsibility
statute.
¶51    Contrary to the circuit court’s cursory finding, the facts material to
deciphering which Wisconsin financial responsibility statute applies do not appear
to be in dispute.   In March 1997, Bestway and Ryder executed the Truck Lease
and Service Agreement, whereby Bestway leased a number of trucks from Ryder.
The lease agreement lists Bestway’s address as Independence, Ohio, and Ryder’s
as Indianapolis, Indiana, and indicates that the leased vehicles were domiciled in
Cincinnati, Ohio.   In October 2001, the parties signed an amendment to the lease
agreement  which  modified  the  rates  Bestway  would  be  charged,  but  did  not
modify the location at which the vehicles were domiciled.   Sometime after the
original lease was executed, however, the vehicles were no longer domiciled in
Ohio.   At the time of the accident, the parties agree that the vehicles were located
in Wisconsin.
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¶52    Having established the material facts, the question before this court
is   which   Wisconsin   statute   the   facts   implicate—the   domestic   financial
responsibility statute (WIS. STAT. § 344.51) or the foreign financial responsibility
statute (WIS. STAT. § 344.52).                                                                      “We give statutory language its common, ordinary,
and accepted meaning, except that technical or specially defined words or phrases
are given their technical or special definitional meaning.”   Donaldson v. Town of
Spring Valley, 2008 WI App 61, ¶6, 311 Wis. 2d 223, 750 N.W.2d 506.                                 “We
must construe a statute in the context in which it is used, not in isolation but as
part of a whole, in relation to the language of surrounding or closely related
statutes, and reasonably, to avoid absurd or unreasonable results.”   Id.
¶53    WISCONSIN STAT. § 344.51, entitled, “Financial responsibility for
domestic rented or leased vehicles,” requires that lessors renting vehicles in
Wisconsin, see American Family Mutual Insurance Co. v. Reciprocal Insurance
Service Exchange Management Co., 111 Wis. 2d 308, 311, 330 N.W.2d 223 (Ct.
App.                                                                                                1983),                                              “file  a  bond  or  insurance  policy  with  the  Department  of
Transportation.   Such bond or policy must provide that the issuing company will
be liable in certain statutory amounts for damages caused by the negligent use of
the lessor’s automobiles,”   Germanotta, 119 Wis. 2d at 295.10   A lessor who fails
to file a bond or policy with the Department of Transportation will still be found
liable for damages caused by the negligent operation of the vehicle up to the
statutory amount.   WIS. STAT. § 344.51(2).
10  Statutory limits are defined by WIS. STAT. § 344.01(2)(d):   “$25,000 because of bodily
injury to or death of one person in any one accident and … $50,000 because of bodily injury to or
death of 2 or more persons in any one accident and in the amount $10,000 because of injury to or
destruction of property of others in any one accident.”
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¶54    WISCONSIN STAT. § 344.52, entitled “Financial responsibility for
foreign rented vehicles,” provides that
(1r)     Whenever  any  motor  vehicle  rented  for
compensation outside this state is operated in this state, the
lessor of the motor vehicle is directly liable for all damages
to persons or property caused by the negligent operation of
the rented vehicle unless, at the time when the damage or
injury  occurs,  the  operation  of  the  rented  vehicle  is
effectively covered by a policy of insurance that provides
coverage at least in the amounts specified in [WIS. STAT. §]
344.01(2)                                                                                   (d) ….
(Emphasis added.)   In other words, unlike the domestic financial responsibility
statute, the foreign financial responsibility statute does not require a lessor to file a
bond  or  insurance  policy  with  the  Department  of  Transportation,  but  instead
simply requires that some insurance policy provide coverage up to the statutorily
required amount.   In the event that no such policy exists, the lessor will be held
directly liable for damages caused by the negligent operation of the vehicle up to
the statutory amount.   See § 344.52.
¶55    Neither  the  statutes  themselves  nor  previous  case  law  define
domestic and foreign in relation to the financial responsibility statutes.   However,
we conclude that the foreign financial responsibility statute applies to the set of
facts before us.
¶56    By the plain language of the statutes, it is not “performance” that
determines which statute applies, as the Caspers contend.   The foreign financial
responsibility statute explicitly covers “any motor vehicle rented outside this state”
but  “operated  in  this  state.”    See  WIS.  STAT.  § 344.52(1r)  (emphasis added).
Accordingly, it is irrelevant to our analysis that the truck was maintained and
operated in Wisconsin because both statutes contemplate that possibility.
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¶57    Having ruled out performance as the determining factor, we turn to
the  remaining  facts,  all  of  which  point  toward  the  application  of  the  foreign
financial responsibility statute:   Bestway listed its address as Independence, Ohio;
Ryder listed its address as Indianapolis, Indiana; and the leased vehicles were
listed in the lease as being domiciled in Cincinnati, Ohio.    Because all of the
parties are outside of the state, and performance of the contract does not determine
which statute to apply, we find the foreign financial responsibility statute, WIS.
STAT. § 344.52, applies to the set of facts before us.
¶58    Applying WIS. STAT. § 344.52, we find that Ryder and ORIC are not
liable for the accident in question.   The statute does not hold a lessor, i.e. Ryder,
liable for damages caused by the negligent operation of the rented vehicle if at the
time when the damage occurs, the operation of the rented vehicle is effectively
covered by a policy of insurance that provides coverage at the amounts specified
by WIS. STAT. § 344.01(2)(d)—“$25,000 because of bodily injury to or death of
one person in any one accident and  …  $50,000 because of bodily injury to or
death of 2 or more persons in any one accident and in the amount $10,000 because
of injury to or destruction of property of others in any one accident.”   As we have
previously  noted,  the  lease  agreement  between  Ryder  and  Bestway  required
Bestway to obtain liability insurance for $1,000,000, well in excess of Wisconsin’s
statutory minimum.   Because Bestway did in fact maintain that insurance policy at
the time of the accident, neither Ryder nor ORIC (as the insurer) is liable for the
accident under Wisconsin’s foreign financial responsibility statute.
¶59    In so finding, we reject the Caspers’ contention that in 1994 when
Ryder filed a Form E “Uniform Motor Carrier Bodily Injury and Property Damage
Liability Certificate of Insurance” with the Department of Transportation, Ryder
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was certifying that its policy with ORIC covered the truck driven by Wearing or
that Ryder was implicitly acknowledging that the domestic financial responsibility
statute applies in this case.   Form E certainly states that Ryder is insured by ORIC.
However, Form E was filed with the Wisconsin DOT in 1994, years before Ryder
and Bestway executed their lease agreement, and the form does not mention the
particular vehicle at issue in this case.   While Form E may be proof that some
Ryder trucks in 1994 were subject to Wisconsin’s domestic financial responsibility
statute, it is not proof that the particular truck at issue in this case is implicated by
the statute.
¶60    Because we find that none of the avenues of relief raised create
liability on behalf of Ryder and ORIC, we remand this case to the circuit court for
dismissal of the Caspers’ claims in that regard.
III.                                                                                        Wenham’s Appeal
¶61    Jeffrey Wenham, the Bestway CEO, appeals from the circuit court’s
order on  motion for reconsideration,  which reinstated the  Caspers’ claim that
Wenham is personally liable in negligence for approving the route that Wearing
was driving the day of the accident, knowing that the route could not be safely
completed pursuant to federal regulations.   Originally, the circuit court granted
Wenham’s motion for summary judgment, dismissing all of the Caspers’ claims
against Wenham as an individual.   The Caspers filed a motion to reconsider, and
the circuit court reinstated the negligence claim against Wenham, agreeing with
the Caspers that it had erred in finding that there was no evidence or testimony
that Wenham personally approved the route.
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¶62    Wenham appeals, asserting that the circuit court erred in finding that
a corporate officer can be held personally liable for non-intentional conduct and
that a material issue of fact exists as to whether Wenham approved the route.   We
affirm the circuit court.
A.                                                                                       Facts
¶63    Bestway   operated   a   fleet   of   trucks   for   Applied   Industrial
Technologies, Inc. (“AIT”), for whom Wearing was making a delivery at the time
of  the  accident.    Wenham,  as  well  as  being  the  CEO,  was  also  the  primary
salesman involved with the AIT account.    Starting in  2001, AIT was putting
financial pressure on Bestway to reduce rates but not services.
¶64    The route Wearing was driving the day of the accident was  536
miles long and took Wearing through Indiana, Illinois, and Wisconsin.   Wearing
began  driving  south  from  Milwaukee,  Wisconsin,  traveling  through  Chicago,
Illinois to Hammond, Indiana.   Once in Hammond, he returned north, driving back
through Chicago and Milwaukee, and continuing up to Green Bay, Wisconsin.
Once  in  Green  Bay,  Wearing  again  turned  around,  driving  south,  back  to
Milwaukee.   He was on his last leg of the route (from Green Bay to Milwaukee),
on his fifth consecutive day driving the route, when his truck collided with the
Caspers’ minivan.   The route ran on both city streets and the freeways of each
state.
¶65    Wenham  testified  that  he  did  not  personally  approve  the  route;
rather, all Bestway routes were created by Bestway employees, Lyle Marion or
Doug  Hoffman  (after  Marion  retired),  and  were  then  approved  by Bestway’s
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safety  department.    Wenham  was,  however,  familiar  with  federal  regulations
regarding routes in 2003 when the accident occurred.
¶66    Hoffman testified during his deposition that he formulated routes
using the “Delorean Mapmaker,” which details the route’s actual miles and the
actual speed limits on the route’s roads.   Hoffman testified that in 2003, Wearing
was  allowed  actual  driving  time  of  ten  hours  per  day  and  fifteen  hours  of
combined driving time and on-duty work time.   Given those restrictions, Hoffman
automatically ruled out any route over 600 miles.   Hoffman also testified that all
new routes were subject to Wenham’s approval.
¶67    The Caspers’ expert, Robert Coulter, testified that the 536-mile route
could not be driven within the time limits permitted by the federal regulations
based on the average speed of a truck on the freeway and on city roads.   More
specifically, Coulter testified that in order to complete a  536-mile route in ten
hours, a driver would have to average  53.6 miles per hour.   He described that
speed as “a physical impossibility” given the weight of the truck, the fact that the
route continued through several metropolitan areas, and utilized both freeways and
city roads.
¶68    At the time of the accident, Wearing had been driving the route in
question for AIT for one-and-a-half to two years.   Wearing testified that he had
contacted Hoffman and told him that he couldn’t possibly do the run within the
applicable federal guidelines taking into account unloading and loading the truck.
Hoffman  told  Wearing  to  mark  the  loading  and  unloading  as  off  duty  time,
bringing Wearing within the ten-hour driving limit.   Wearing was later cited for
falsifying his books during the AIT route.   Wenham was regularly notified when a
driver was cited for falsifying a logbook or when other safety concerns arose.
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B.                                                                                        Negligence Claim Against Wenham Personally
¶69    As an initial matter, the parties argue over whether Wenham appeals
the circuit court’s order on motion to reconsider, in which case we determine
whether the circuit court erroneously exercised its discretion, see State v. White,
2008 WI App 96, ¶9, 312 Wis. 2d 799, 754 N.W.2d 214, or whether Wenham
appeals the circuit court’s order on motion for summary judgment, in which case
we review the circuit court’s decision de novo, see Green Spring Farms,  136
Wis. 2d at 314-15.   In the end, however, the distinction is without a difference,
because we affirm the circuit court under either standard.
¶70                                                                                       “It is basic to the Anglo-American law of torts that, absent a valid
defense, one  is liable  for  the  harm proximately caused  by his  own negligent
conduct.”   Shannon v. City of Milwaukee, 94 Wis. 2d 364, 369, 289 N.W.2d 564
(1980),  superseded  on  other  grounds  by  statutory  amendment  to  WIS.  STAT.
§ 345.05, as recognized in Gonzalez v. Teskey, 160 Wis. 2d 1, 8-10, 465 N.W.2d
525  (Ct. App.  1990).    We have held that  “[u]nder the doctrine of respondeat
superior an employer can be held vicariously liable for the negligent acts of his
employees while they are acting within the scope of their employment.”   Id. at
370.                                                                                      “The additional liability of  the employer, however, does not shield the
negligent  employee  from  his  own  personal  liability,  nor  does  it  supplant  his
liability with that of his employer.”   Id.                                               “It provides only an alternative … source
from which the injured party may recover … damages.”   Id.   Such is the case here.
To the extent that Wenham may have negligently approved the route in question,
he cannot hide from his own personal liability because he is a corporate officer.
¶71    In reinstating the negligence claim against Wenham, the circuit court
heavily relied on Oxmans’ Erwin Meat Co. v. Blacketer, 86 Wis. 2d 683, 273
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