Roggensack sole dissenter on ‘harsh on the consumer’ insurance law decision

Listen to this article

Chief Justice Patience Roggensack was the sole dissenter this week in a Wisconsin Supreme Court insurance-law decision she called “harsh on the consumer.”

The high court released its decision in Emer’s Camper Corral v. Michael A. Alderman on Thursday. Emer’s, a Fitchburg seller of camper trailers, sued Alderman, its insurance agent, after alleging he owed it $120,000 because he had promised a better insurance policy than what he had provided.

Alderman told Camper Corral he had obtained a policy with a $1,000 deductible per camper for hail damage and a $5,000 aggregate deductible limit for the 2013-14 policy year. However, the policy Alderman actually obtained required a $5,000 per camper deductible and had no aggregate limit.

Camper Corral incurred $125,000 in hail damage to 25 campers in September 2014. It was only then that Rhonda Emer, one of the owners of Camper Corral, discovered the actual terms of the company’s insurance policy.

The company sued Alderman, claiming he breached his duty of care. The complaint alleged he was liable in the amount of $120,000 — the difference between the deductible Camper Corral paid for the damage and the $5,000 aggregate deductible the company believed it had.

The circuit court granted Alderman a motion for a directed verdict challenging the causal connection between Camper Corral’s damages and Alderman’s failure to obtain an insurance policy with the desired terms. The Court of Appeals affirmed the ruling, arguing that no credible evidence introduced at trial showed that Camper Corral could have obtained a deductible lower than $5,000.

Camper Corral then petitioned the state Supreme Court to review whether it had to prove both that the insurance policy with the requested deductibles was commercially on offer and whether the insurer would have actually written the policy for Camper Corral.

The state Supreme Court affirmed the Court of Appeals decision on Thursday. The justices held that commercial availability is insufficient to establish causation, meaning Camper Corral couldn’t prevail without also proving it would have qualified for an insurance policy with better terms than the policy it had actually obtained.

Justice Dan Kelly delivered the majority opinion, joined by justices Ann Walsh Bradley, Rebecca Bradley, Rebecca Dallet, Brian Hagedorn and Annette Ziegler.

Kelly wrote that the high court had concluded the general principles governing proof of causation didn’t support Camper Corral’s “commercial availability” standard.

“(I)n asking us to accept ‘commercial availability’ as sufficient proof of causation, Camper Corral is actually asking us to grant it an evidentiary presumption to help it bridge the gap between general and particular availability of the desired insurance policy,” Kelly wrote.

Roggensack was the sole dissenter, calling the majority opinion “wrong on the law and wrong on the facts.” She said the decision sets up a new and rigid evidentiary burden for causation at the expense of the consumer.

“The majority opinion is unnecessarily harsh on the consumer and, as it has in this case, will immunize misrepresentations by insurance agents who have superior knowledge of how to search the insurance industry to determine whether the insured was eligible for particularized insurance,” Roggensack wrote.

Roggensack said the trial had produced evidence that a policy with a $1,000/$5,000 deductible was commercially on offer to Camper Corral. Kelly, though, said that Camper Corral had made no such argument throughout the entire history of the case.

“Denying a recovery to which Camper Corral is not entitled is not harsh, it is just,” Kelly wrote. Follow @WLJReporter