99-2078 Putnam, et al. v. Time Warner Cable of Southeastern Wisconsin

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“First, the customers allege that they paid the $5.00 late fee without knowing that Time Warner’s actual costs from a late payment were only $0.38 to $0.48. Second, they maintain that Time Warner concealed material information regarding its late-payment costs. Even assuming these allegations are true, neither allegation falls within the exceptions to the voluntary payment doctrine. The customers appear to be synthesizing the two allegations, one sounding in fraud and the other in mistake of fact, with the hope that the whole of the summated argument will be greater than its individual parts.

“The customers’ contention that they lacked full information goes to a mistake of law on their part, not a mistake of material fact. The customers complain that they were mistaken in not realizing that the actual cost of late payment to Time Warner was only $0.38 to $0.48. However, the customers possessed full knowledge of the $5.00 late fee and of the circumstances under which they would be exposed to it. [Citation]. Although they failed to exercise any diligence to inquire into or contest the cost-accounting basis of Time Warner’s late-payment fee, the customers now assert that Time Warner impermissibly concealed and omitted information related to the basis of the fee amount. This assertion conflates the issue of mistake of fact with the customers’ allegations of fraud.

“The customers’ allegations of fraud are to no avail. The amended complaint does no more than assert nebulous wrongdoing on the part of Time Warner; it does not allege fraud with the particularity required under Wisconsin’s pleading requirements.”

Accordingly, plaintiffs’ claims for monetary relief from the unlawful liquidated damages were correctly dismissed.

However, the circuit court erred in denying the customers’ claim for declaratory relief to prevent defendant from imposing late payment fees in the future.

“The issue to be decided is sufficiently clear and imminent for a court to conclusively determine legal rights under this provision of the contract. Therefore, a declaration as to the legality of the future imposition of Time Warner’s late-payment fee is appropriate.

“By the Court. – The decision of the court of appeals is affirmed in part, reversed in part, and the cause is remanded to the circuit court.”

CONCURRING IN PART, DISSENTING IN PART: Bablitch, J., with whom Abrahamson, Ch. J., joins, concurring in part and dissenting in part.”). “The majority refuses to allow a claim based on an unlawful liquidated damages provision to serve as an exception to the voluntary payment doctrine. In other words, the majority holds that absent fraud, duress, or mistake of fact, the voluntary payment doctrine prohibits recovery notwithstanding the existence of an unlawful liquidated damages provision. I disagree and accordingly respectfully dissent to parts I and II A of the majority opinion. I join part II B of the majority opinion.”

DISSENTING IN PART: Sykes, J. with whom Wilcox and Crooks, JJ., join, dissenting in part. “I agree completely with the majority opinion on the issue of the voluntary payment doctrine’s application to this case, and therefore join the majority in Parts I and II A, in which the court affirms the court of appeals’ decision affirming the circuit court’s dismissal of the plaintiffs’ claims for monetary relief in counts I-VIII of the amended complaint. I disagree, however, with the majority’s conclusion in Part II B that the circuit court erroneously exercised its discretion in dismissing count IX, the plaintiffs’ claim for declaratory relief.”

Court of Appeals, Prosser, J.

Attorneys:

For Appellant: John C. Cabaniss, Milwaukee; John J. Carey, St. Louis, Missouri

For Respondent: Robert H. Friebert, Jeremy P. Levinson, Milwaukee