Reasonable Costs Case Analysis

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As a result of the decision, all fee-shifting statutes could be interpreted to allow for an award of “reasonable costs,” regardless of whether the statute allows for “actual costs” or just “costs.”

Any statute which is designed to protect consumers (or tenants, or any other group deemed to have unequal bargaining power), will be indistinguishable from sec. 218.0163(2). Unless “reasonable costs” are allowed, there will be insufficient incentive for those protected by the statute to actually enforce it.

The majority opinion includes a helpful footnote, to guide practitioners. Footnote 13 states as follows: “For a complete listing of the 50-plus fee-shifting provisions in Wisconsin law, see 3 Hon. Robert D. Sundby & Steven P. Means, Law of Damages in Wisconsin, Chapter 37, Attorney Fees, Appendicies 37A and 38B (Russell M. Ware ed., 4th ed. 2005).”

Under the reasoning in the case at bar, each of those statutes could logically permit an award of all reasonable costs and attorney fees, even if the statutes could be interpreted to provide only limited costs and fees.

The court’s conclusion — “Providing for reasonable attorney fees and costs ensures that individuals will enforce the rights provided to them under the statute by the legislature, even when the costs of litigation exceed the value of the action” — will be equally applicable to any statute designed to protect any party who has unequal bargaining power.

It should also be noted that the decision conflicts with a Seventh Circuit opinion, Bob Willow Motors, Inc., v. General Motors Corp. 872 F.2d 788 (7th Cir. 1989).

The court there interpreted “costs including a reasonable attorney fee” to permit an award of costs that includes only ordinary, taxable costs.

In light of the decision in the case at bar, federal courts must conclude that Bob Willow Motors is no longer valid law.

Curiously, however, even though the Supreme Court wrote, “this court is not bound by a federal court’s interpretation of Wisconsin law,” Westlaw misclassifies the case at bar as a “Positive Case” that follows Bob Willow Motors, rather than a “Negative Case” that distinguishes and effectively overrules it. As a result, attorneys doing research are not immediately alerted that the case is no longer valid.

	Related Article ‘Costs’ includes ‘reasonable costs’

Finally, the court’s method of analysis is noteworthy. At no point in the decision does the court consider whether “costs” is ambiguous or unambiguous. The court of appeals concluded that “costs” unambiguously means “taxable costs,” and thus did not even consider whether such an interpretation furthers the purpose of the statute.

Since State ex rel. Kalal v. Circuit Court, 2004 WI 58, 271 Wis.2d 633, 681 N.W.2d 110, 124, classification of a disputed statutory term as either ambiguous or unambiguous has been the starting point of statutory interpretation.

However, the Supreme Court dispenses with the inquiry altogether, stating only, “A plain-meaning interpretation of a statute cannot contravene a textually or contextually manifest statutory purpose.”
It may be that the court is moving away from the strictures of Kalal, a sea change in how parties write briefs, and courts decide cases, when statutory interpretation is the issue.

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David Ziemer can be reached by email.