Please ensure Javascript is enabled for purposes of website accessibility

Notice required to find frivolousness

By: dmc-admin//June 29, 2005//

Notice required to find frivolousness

By: dmc-admin//June 29, 2005//

Listen to this article

Image

“The court of appeals may … raise the issue of a frivolous appeal on its own motion, but it must give notice that it is considering the issue and grant an opportunity for the parties and counsel to be heard before it makes a determination.”

Hon. Patience Drake Roggensack Wisconsin Supreme Court

The court of appeals should not find an appeal frivolous without first giving the offending party notice and an opportunity to respond, the Wisconsin Supreme Court held on June 22.

According to Gary J. Howell, he negotiated a price of $68,000 for a home with the owners, Gregg and Cynthia Sikora, and contacted Orrin and Helen Denomie for financing. Closing occurred on April 17, 2000 with Gregg Sikora, Howell and the Denomies present. The deed filed for the sale of the property listed Howell as the purchaser, and the mortgage listed Howell as the mortgagor and the Denomies as the mortgagees.

The Denomies gave a cashier’s check for $67,500 to the bank, and Howell signed a promissory note and real estate mortgage to the Denomies. Howell agreed to make monthly payments on the note and the Denomies received an amortization schedule for the amount of the promissory note.

Ultimately, Howell refinanced with Citizens State Bank, and the Denomies cashed checks representing payment of the outstanding balance on the mortgage. However, the Denomies would not sign the satisfaction of mortgage.

Howell brought an action against them seeking a judgment satisfying and discharging the mortgage, penalty damages under sec. 706.05, actual damages, attorney fees and costs.

The Denomies counterclaimed, asserting they agreed to purchase the house for Howell, rent it to him and sell it to him when he could afford to purchase it. They claimed they refused to sign the satisfaction because they had never agreed to be a mortgage holder.

Trempealeau County Circuit Court Judge John A. Damon tried the case, and held in favor of Howell, based on his credibility findings and the unambiguous written documents showing that Howell had purchased the property and his agreement with the Denomies was a mortgage agreement. Judge Damon also found that the counterclaim was frivolous pursuant to sec. 814.025.

The Denomies appealed, and the court of appeals affirmed. The court also found the appeal frivolous, pursuant to Rule 809.25(3)(c), on its own motion, and remanded to the circuit court for a determination of fees.

What the court held

Case: Howell v. Denomie, No. 2003AP979-FT.

Issue: What is the procedure for the court of appeals to follow before finding an appeal frivolous?

Holding: The court should give the party purported to have filed a frivolous appeal notice and opportunity to be heard on the issue.

Counsel: Robert E. Haney, Alvin R. Ugent, for appellant; Robert C. Longwell, Jr., Galesville, for respondent.

The Supreme Court accepted review to address the procedure by which the court of appeals may determine an appeal is frivolous, and affirmed in a decision by Justice Patience Drake Roggensack.

Sanctions for a frivolous appeal will be imposed if the court concludes that the "party or party’s attorney knew, or should have known, that the appeal . . . [had no] reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification or reversal of existing law." Since the standard is objective, an appellate court looks to what a reasonable party or attorney knew or should have known under the same or similar circumstances.

The court first found that the Denomies answer and counterclaim were correctly found frivolous by the circuit court and court of appeals: "The record overwhelmingly shows that the Denomies were aware of the transactions taking place. They were present at the closing and Brommerich testified that they witnessed the documents being signed. The Denomies incorrectly cite Brommerich’s testimony to state that the Denomies never received any paperwork from the closing, as he stated that while he could not ‘positively say’ whether the Denomies received a copy of the promissory note, it was the bank’s policy to give copies, and in any case, Orrin Denomie testified that Howell gave them the documents ‘a day or two’ after the closing. Howell testified that he paid the real estate taxes, flood insurance and property insurance on the property, and that even though he made numerous improvements to the property that the Denomies were aware of, including the addition of a deck, he never sought approval to make these improvements. The Denomies accepted the payments of $63,291.34 and $687.40 that were inconsistent with the rental relationship that the Denomies claimed existed. Given all of this evidence that was known to the Denomies, we agree with the circuit court and the court of appeals that the Denomies’ answer and counterclaim were frivolous."

Turning to the procedures for finding an appeal frivolous, the court held, "in order to determine that an appeal is frivolous, the court of appeals is required to give notice that it is considering the issue. It must also give an opportunity to respond to the issue before a determination is made."

The court noted that, in Weiland v. Paulin, 2003 WI 27, 260 Wis. 2d 277, 659 N.W.2d 875, the court of appeals, on its own motion, concluded that the appeal was frivolous, and ordered that fees and costs be assessed against appellate counsel. Unlike the summary order in the present case, the court of appeals detailed the various transgressions committed by appellate counsel.

Related Links

Wisconsin Court System

Related Article

Case Analysis

The Supreme Court responded to counsel’s petition for review by issuing a summary order reversing the court of appeals and remanding the matter to the court of appeals with directions to give the parties an opportunity to be heard regarding whether the appeal is frivolous.

Adopting that procedure across the board in the case at bar, the court wrote, "In order for parties before the court of appeals to have the proper notice and opportunity to be heard, parties wishing to raise frivolousness must do so by making a separate motion to the court, whereafter the court will give the parties and counsel a chance to be heard. We caution that a statement in a brief that asks that an appeal be held frivolous is insufficient notice to raise this issue. The court of appeals may also raise the issue of a frivolous appeal on its own motion, but it must give notice that it is considering the issue and grant an opportunity for the parties and counsel to be heard before it makes a determination."

Nevertheless, the court affirmed the finding that the appeal was frivolousness in this case, even though the court of appeals made the finding without giving the Denomies’ attorney a chance to be heard, because they had an opportunity in their briefs and at oral argument before the Supreme Court.

Click here for Case Analysis.

David Ziemer can be reached by email.

Polls

Should Steven Avery be granted a new evidentiary hearing?

View Results

Loading ... Loading ...

Legal News

See All Legal News

WLJ People

Sea all WLJ People

Opinion Digests