APPEAL from a judgment of the Circuit Court for
Walworth County, John R. Race, Judge. Reversed.
¶1 DAVID T. PROSSER, J. This case is before the
court on certification by the court of appeals pursuant to
Wis. Stat. (Rule) § 809.61 (2003-04). It addresses the relationship between the
restitution order in a criminal case and a subsequent settlement agreement in a
civil case. The Walworth County Circuit
Court, John R. Race, Judge, dismissed Robert Vlazny's (Vlazny) motion to
enforce a settlement agreement to preclude Theresa Huml (Huml) from enforcing a
judgment derived from a criminal restitution order, after Vlazny was released
from probation.
¶2 We are presented with two issues.
First, may a civil settlement agreement between a crime/tort victim and
a criminal defendant/tortfeasor preclude the victim from collecting unpaid
restitution that the defendant was ordered to pay in the criminal proceeding,
after the defendant's probation ends and the unpaid restitution is reduced to a
civil judgment pursuant to Wis. Stat. §§ 973.09(3)(b) and
973.20(1r)? Second, did the settlement
agreement between Theresa Huml and Robert Vlazny preclude Huml from enforcing
the civil judgment derived from the restitution order?
¶3 Vlazny argues that Wis. Stat. § 973.09(3)(b)
requires a court to enter a civil judgment for the amount of unpaid restitution
when probation ends. When this occurs,
he contends, an existing settlement agreement between the defendant and the
victim may preclude the victim from enforcing the judgment. He claims that his settlement agreement with
Huml bars her from enforcing the judgment.
¶4 Huml responds that Vlazny's position is contrary to
Wis. Stat. § 973.20(1r), which provides that after probation
terminates, unpaid restitution "is enforceable in the same manner as a
judgment in a civil action by the victim[.]" She contends that the phrase "in the same manner as a civil
judgment" indicates that it is not a civil judgment. Huml reasons that her interpretation is
consistent with the notion that a restitution judgment is criminal in nature
and should not be extinguished by a civil settlement agreement. Therefore, Huml concludes, her settlement
agreement with Vlazny cannot preclude her from enforcing the restitution order
once it is reduced to a judgment.
¶5 We conclude that a civil settlement agreement can have no effect
upon a restitution order while the defendant remains on probation, unless the
circuit court finds that enforcing the restitution order in addition to the
settlement agreement would result in a double recovery for the victim. After a defendant is released from
probation, however, and any unpaid restitution under the restitution order is
converted to a civil judgment, a settlement agreement between the victim and
defendant may——depending upon its terms——preclude the victim from enforcing the
judgment. We conclude that the global
settlement agreement that Huml entered into with Vlazny precludes her from
enforcing the judgment converted from the restitution order.
¶6 Accordingly, we reverse the judgment of the circuit court.
I.
BACKGROUND
¶7 On June 20, 1993, Vlazny seriously injured Huml when the
automobile he was driving collided head-on with Huml's car. Prior to the accident, Vlazny had been
drinking. On November 11, 1993, Vlazny
was convicted of injury by intoxicated use of a vehicle, in violation of
Wis. Stat. § 940.25(1)(a).
The circuit court sentenced Vlazny to two years imprisonment but stayed
the sentence and placed him on three years probation. As a condition of probation, the circuit
court initially ordered Vlazny to pay $500,000 in restitution to Huml. Subsequently, the circuit court amended the restitution
order after Vlazny and Huml stipulated, pursuant to
Wis. Stat. § 973.20(13)(c), that restitution should be set at
$140,000, payable for the duration of probation in monthly installments of
$425.
¶8 At a January 24, 1994, restitution hearing, Court Commissioner
Paul Barrett noted that the parties' agreed-upon restitution schedule would
leave the majority of the ordered restitution unpaid at the end of Vlazny's
probation. Assistant District Attorney Steven Watson
informed the commissioner that Huml planned to initiate a civil suit against
Vlazny, and that any restitution payments would be set off in the civil suit.
¶9 On May 16, 1995, Huml filed a civil action against Vlazny and the
insurer of the car he was driving, St. Paul Fire and Marine Insurance Company
(St. Paul). Watson, who had left the
district attorney's office, represented Huml in her civil suit. Huml settled her suit against Vlazny and St.
Paul on December 12, 1996. The
settlement agreement provided:
The parties
agree that in consideration of the full discharge of past, present and
future claims arising out of the allegations set forth in Plaintiff's
Amended Complaint . . . , as a result of the alleged
actions or omissions of Defendants, Insurer agrees to pay the sum hereinafter
specified. . . .
This
Settlement Agreement and Release shall apply to all claims, whether
known or unknown, on the part of all parties to this Agreement. In consideration of the payments called for
herein, Plaintiff completely releases and forever discharges Defendants,
Insurer, and their agents . . . from any or all claims,
actions, causes of action, demands, rights, damages, costs, loss
of service, expenses and compensation whatsoever, including court costs,
legal expenses and attorneys' fees which the undersigned now has or had or which
may hereafter accrue on account of or in any way arising out of any and all
known and unknown, foreseen and unforeseen bodily and personal
injuries . . . resulting from the accident, casualty or
event listed in Plaintiff's Amended Complaint.
(Emphasis added.)
In exchange for releasing
Vlazny and St. Paul, Huml received an initial lump sum payment of $548,000,
monthly payments for the rest of her life in increasing amounts, and larger
periodic payments paid on average every 16 to 18 months.
¶10 Meanwhile, Vlazny remained on probation. Because his restitution payments were sporadic, his probation was
twice extended by the court. In August
2002, more than eight years after Vlazny was sentenced, his probation agent
recommended that Vlazny be released from probation and that the unpaid
restitution be reduced to a civil judgment.
The circuit court terminated Vlazny's probation in December 2002. He had paid $33,705 to Huml, leaving a
balance of $107,900.46. Pursuant to
Wis. Stat. § 973.09(3)(b), the circuit court entered judgment
for Huml against Vlazny for the amount of unpaid restitution.
¶11 When Huml attempted to enforce the judgment against Vlazny, Vlazny
filed a motion in the criminal court to vacate the judgment or reduce it to
zero, arguing that the settlement agreement precluded Huml from enforcing the
judgment. The criminal court ruled that
the matter became a civil matter when the restitution order was reduced to
judgment, and it directed Vlazny to proceed in civil court. Accordingly, Vlazny filed a motion to
enforce the settlement agreement in civil court.
¶12 The circuit court denied Vlazny's motion to reduce the judgment to
zero, concluding that the settlement agreement had no effect upon Huml's ability
to enforce the judgment. Vlazny
appealed and the court of appeals certified the following question:
"Whether a written settlement agreement and release discharging a
defendant from civil liability for all past, present and future claims arising
out of his or her criminal conduct precludes the crime victim from enforcing a
subsequent judgment for unpaid restitution entered after the defendant has been
released from probation." Huml
v. Vlazny, No. 2004AP36, unpublished certification (Wis. Ct. App. Sept. 14,
2005).
II.
STANDARD OF REVIEW
¶13 The issue presented requires us to interpret
Wis. Stat. §§ 973.09(3)(b) and 973.20(1r), which we do
independent of the circuit court's analysis.
State v. Sweat, 208 Wis. 2d 409, 414-15, 561 N.W.2d 695
(1997). Additionally, we must review
the settlement agreement to determine whether the parties intended it to
encompass the restitution judgment.
Contract interpretation and whether a contract is ambiguous are both
questions of law we review de novo. Wis.
Label Corp. v. Northbrook Prop. & Cas. Ins. Co., 2000 WI 26, ¶¶22, 23,
233 Wis. 2d 314, 607 N.W.2d 276.
III.
STATUTORY INTERPRETATION
¶14 In statutory interpretation, we begin with the language of the
statute. State ex rel. Kalal v.
Circuit Court for Dane County, 2004 WI 58, ¶45, 271 Wis. 2d 633,
681 N.W.2d 110. If the meaning of
the statute is unambiguous after considering the text of the statute, its
context, and any policies evident from the text, our analysis ordinarily stops
and we give effect to the intent of the legislature as set forth in the plain
language of the statute. Id.,
¶¶46, 48. In the absence of ambiguity,
we do not look to extrinsic sources to ascertain legislative intent, except to
bolster the plain meaning interpretation.
Id., ¶51.
¶15 A statute is ambiguous when it is susceptible to more than one
reasonable interpretation. Id.,
¶47. "Ambiguity can be found in
the words of the statutory provision itself, or by the words of the provision
as they interact with and relate to other provisions in the statute and to
other statutes." Sweat, 208
Wis. 2d at 416. We conclude
that when they are juxtaposed, Wis. Stat. §§ 973.09(3)(b) and
973.20(1r) are ambiguous.
¶16 On one hand, Wis. Stat. § 973.09(3)(b) plainly
requires a circuit court to inform the probationer that a "civil
judgment" will be entered against him for the amount of unpaid
restitution. Section 973.09(3)(b)
states:
If the court does not extend probation, it shall issue
a judgment for the unpaid restitution and direct the clerk of circuit court to
file and enter the judgment in the judgment and lien docket, without fee,
unless it finds that the victim has already recovered a judgment against the
probationer for the damages covered by the restitution order. If the court issues a judgment for the
unpaid restitution, the court shall send to the person at his last-known
address written notification that a civil judgment has been issued for
the unpaid restitution. The judgment
has the same force and effect as judgments entered under s. 806.10. (Emphasis added.)
The statute appears to provide
that upon completion of a defendant's probation, the circuit court shall enter
a "civil judgment" "for the unpaid restitution,"
"unless it finds that the victim has already recovered a judgment against
the probationer for the damages covered by the restitution order." This judgment has the same force and effect
as other judgments for money under Wis. Stat. § 806.10. Accordingly, the statute implies that a
separate settlement agreement could encompass the judgment derived from the
restitution order and could preclude the victim from enforcing the judgment.
¶17 On the other hand, Wis. Stat. § 973.20(1r) suggests
a judgment derived from a restitution order retains its nature as restitution,
but that the victim may enforce the judgment by using civil enforcement
mechanisms (e.g., attachment or garnishment) or by seeking remedial sanctions
for contempt. Section 973.20(1r)
states: "After the termination of
probation, . . . restitution ordered under this section is
enforceable in the same manner as a judgment in a civil action by the victim
named in the order to receive restitution or enforced under ch. 785." Based on this statute, a reasonable person
might conclude that any unpaid restitution, even when reduced to a judgment,
retains its nature as restitution and cannot be bargained away in a settlement
agreement.
¶18 To resolve the ambiguity in the relationship between
Wis. Stat. §§ 973.09(3)(b) and 973.20(1r), we look to the broad
context of these two statutes.
¶19 Wisconsin Stat. § 973.09 grants a circuit court the
authority to impose probation upon a criminal defendant. Probation serves two purposes, to
rehabilitate the defendant and to protect society and the public interest. State v. Gray, 225
Wis. 2d 39, 68, 590 N.W.2d 918 (1999); Huggett v. State,
83 Wis. 2d 790, 798, 266 N.W.2d 403 (1978).
¶20 In furtherance of these dual purposes,
Wis. Stat. § 973.09(1)(b) requires a court to impose restitution
upon any person placed on probation, "unless the court finds there is
substantial reason not to order restitution as a condition of probation." As a condition of probation, restitution
tends to promote rehabilitation by "strengthening the individual's sense
of responsibility." Huggett,
83 Wis. 2d at 798.
Restitution makes at least some of the injury inflicted upon the victim
tangible to the defendant. The primary
purpose of restitution, however, is to compensate the victim, thereby advancing
society's interest in seeing victims made whole. See Sweat, 208 Wis. 2d at 422; Huggett,
83 Wis. 2d at 798; State v. Canady, 2000 WI App 87, ¶8, 234
Wis. 2d 261, 610 N.W.2d 147.
¶21 The link between Wis. Stat. §§ 973.09 and 973.20
appears in § 973.09(1)(b), which contains a cross-reference to
§ 973.20. Section 973.20 dictates
the requirements and limitations of restitution orders.
¶22 An overview of Wis. Stat. §§ 973.09 and 973.20
reveals that a fundamental policy of these statutes is to make victims whole
without allowing them to receive double recoveries. To achieve this result, the statutes afford three opportunities
to avoid double recovery. First, a
defendant may assert any defense, including accord and satisfaction or setoff,
in the sentencing hearing at which the circuit court determines whether to
impose restitution.
§ 973.20(14)(b); Sweat, 208 Wis. 2d at 424. Second, before a circuit court reduces any
unpaid restitution to a civil judgment, the probationer may prove that the
victim has already recovered damages from him that are the same as the damages
covered by the restitution order.
§ 973.09(3)(b). Third, in a
civil action a defendant may prove that restitution payments set off part or
all of a civil judgment in favor of the victim. § 973.20(8).
¶23 The procedural posture of this case does not fit snugly within any
of these three scenarios. Huml and
Vlazny did not enter into the settlement agreement until after the sentencing
court imposed the restitution order. We
cannot tell——because we do not have the record——whether Vlazny had the
opportunity to object to the entry of the civil judgment for the $107,900.46 of
unpaid restitution. In any event, Vlazny does not seek to set
off from the settlement agreement the amount of restitution he paid. Rather, Vlazny claims his settlement
agreement with Huml precludes her from enforcing the judgment derived from the
unpaid restitution.
¶24 Because the timing of events in this case does not fit cleanly into
the statutory scheme, and because Huml and Vlazny present competing reasonable
interpretations, we look to (1) legislative history; (2) relevant case law; and
(3) public policy to determine which interpretation best accords with
legislative intent.
A. Legislative History
¶25 The relevant portions of Wis. Stat. §§ 973.09(3)(b)
and 973.20(1r) are the result of two bills crafted by the Judicial Council,
1987 Assembly Bill 190, enacted as 1987 Wisconsin Act 398, and 1989 Assembly
Bill 316, enacted as 1989 Wisconsin Act 188, §§ 1 and 2. Included in 1987 Wisconsin Act 398 are
Judicial Council notes that explain the changes made by the Act.
¶26 Three notes are of interest.
The first, the Judicial Council Prefatory Note, summarizes the changes
to the then-existing law, and states that the Act "allows unpaid
restitution to be enforced by the victim as a civil judgment when the
offender is released from probation . . . ." 1987 Wis. Act 398 (emphasis added).
¶27 The second Judicial Council note elaborates on this point, stating:
The availability of a civil judgment for unpaid
restitution enforceable by the victim under s. 973.20(1), stats., substantially
reduces the necessity of extending probation solely for the purpose of
enforcing court-ordered payments, a practice of questionable
cost-effectiveness. [citation omitted] Probation may, however, be extended upon
stipulation of the defendant, to enforce community service in satisfaction of
restitution, or when the probationer has not made a good faith effort to make
restitution or other payments.
Judicial Council Committee
Note, 1987, Wis. Stat. § 973.09 (emphasis added).
¶28 The third relevant Judicial Council note states that
Wis. Stat. § 973.20 "allows restitution unpaid at the time
probation or parole supervision terminates to be enforced by the victim as a
judgment creditor." Judicial
Council Committee Note, 1987, Wis. Stat. § 973.20 (emphasis
added). These Judicial Council notes
demonstrate a legislative intent that unpaid restitution be converted to a
civil judgment upon the termination of probation.
¶29 Governor Tommy Thompson vetoed the language in 1987 Assembly Bill
190 that would have converted a restitution order into a civil judgment. Gov. Tommy Thompson, Veto Message to
Assembly Bill 190 (available at Legislative Reference Bureau, Madison,
Wisconsin). In his veto message,
Governor Thompson explained that he vetoed these provisions because they raised
constitutional concerns. Id. Specifically, Governor Thompson objected to
the fact the bill would have allowed a civil judgment to be entered without a
separate trial to establish the propriety of restitution or its amount. Id.
¶30 The effect of Governor Thompson's veto was to perpetuate the
practice of requiring crime victims to whom restitution was owed to institute
separate civil actions to collect any unpaid restitution once a defendant was
released from probation. See
Legislative Reference Bureau Drafting File for 1989 Wis. Act 188, Analysis
by the Legislative Reference Bureau of 1989 Assembly Bill 316.
¶31 In response to the veto, the Judicial Council sponsored 1989
Assembly Bill 316, which contained language nearly identical to that which was
vetoed by the Governor. In a memo to
the Senate Judiciary and Consumer Affairs Committee, James Fullin, Executive
Secretary of the Judicial Council and the Reporter for the Judicial Council
Restitution Committee, explained that (1) the proposal to allow a circuit court
"to enter a civil judgment for unpaid restitution" was modeled on
federal law, the Victim and Witness Protection Act of 1982 (VWPA);
and (2) at least six federal circuits had upheld the analogous federal
provision against constitutional challenges.
Memorandum from James Fullin to Senate Judiciary and Consumer Affairs
Committee (Jan. 9, 1990) (available at the Wisconsin State Law Library). On April 10, 1990, 1989 Assembly Bill 316
was enacted as 1989 Wisconsin Act 188, creating the language at issue in this
case. Thus, although the three
above-described Legislative Council notes were part of 1987 Wisconsin Act 398,
they apply with equal force to explain 1989 Wisconsin Act 188.
¶32 In addition to the Judicial Council notes, the analysis of 1989
Assembly Bill 316 by the Legislative Reference Bureau, which is printed on the
bill, stated:
Under present law, if a
probationer or parolee does not pay the court-ordered restitution in full prior
to termination of the probation or parole, or if a defendant not placed on
probation or parole fails to pay the court-ordered restitution, the victim may
start a civil action to collect any unpaid restitution. The victim may start a civil action, obtain
a judgment for the unpaid restitution, and proceed with collection procedures
on the judgment. Under this bill,
restitution unpaid at the end of a probation or parole period is docketed as a
civil judgment if the victim has not already obtained a judgment for the
damages covered by the restitution order.
Legislative Reference Bureau
Drafting File for 1989 Wis. Act 188, Analysis by the Legislative Reference
Bureau of 1989 Assembly Bill 316 (emphasis added).
¶33 The legislative history, therefore, demonstrates that the
drafters——and, in turn, the legislature——intended a restitution order to become
a civil judgment upon the completion of probation. The changes effected by 1987 Wisconsin Act 398 and 1989 Wisconsin
Act 188 streamlined the procedure to reduce unpaid restitution to a civil
judgment. Based in part on this
underlying history, we conclude the more reasonable interpretation of the
phrase "in the same manner as a judgment in a civil action" in
Wis. Stat. § 973.20(1r) is that the resulting judgment is a civil
judgment. The conditional language in
the statute may reflect the abbreviated procedure by which the judgment was
obtained, but it does not diminish the fact that the judgment is a civil
judgment.
¶34 Simplifying the procedure by which a victim obtains a judgment to
enforce unpaid restitution is entirely consistent with the overarching purposes
of the legislation: to promote the dignity of crime victims, to maximize the
respect afforded victims by the criminal justice system, and to increase the
amount of restitution recovered.
Allowing a victim to negotiate to extinguish his or her interest in a
judgment derived from a restitution order as part of a global settlement is
consistent with the legislature's desire to afford respect to the dignity of
victims.
B. Relevant Case Law
1. Wisconsin Case Law
¶35 The parties focus their analyses on three Wisconsin cases: Sweat;
State v. Walters, 224 Wis. 2d 897, 591 N.W.2d 874 (Ct.
App. 1999); and Olson v. Kaprelian, 202 Wis. 2d 377, 550
N.W.2d 712 (Ct. App. 1996).
Consequently, a brief summary and discussion of each case is necessary.
¶36 In Sweat the defendant claimed a civil statute of
limitations barred the state from seeking restitution. Sweat, 208 Wis. 2d at
412. The defendant relied upon
Wis. Stat. § 973.20(14)(b), which states in part, "[t]he
defendant may assert any defense that he or she could raise in a civil action
for the loss sought to be compensated."
The court rejected the defendant's argument. Id. at 414.
Instead, it interpreted § 973.20(14)(b) to mean that in a restitution
proceeding a defendant may raise any defense that goes to the amount of
restitution, such as mitigation, setoff, or accord and satisfaction. Id. at 424.
¶37 The availability of accord and satisfaction and setoff as defenses
to the amount of restitution a circuit court can order supports the idea that a
victim can give up her right to enforce a judgment derived from a restitution
order. Of course, a settlement
agreement does not necessarily prevent the circuit court from ordering restitution,
Walters, 224 Wis. 2d at 905, nor does it necessarily prevent
enforcement of a restitution order during the term of probation. Only if a circuit court first finds that
enforcement of the restitution order would result in double recovery for the
victim can a settlement agreement affect a circuit court's authority to enter
or enforce a restitution order while a defendant remains on probation.
¶38 The court has broad power to require restitution, so long as the
restitution serves statutory purposes.
Restitution serves the dual purposes of making the victim whole and
rehabilitating the defendant. Sweat,
208 Wis. 2d at 423. If a
restitution order does not serve both purposes, restitution is not
appropriate. Thus, if a settlement
agreement fails to make the victim whole——as determined independently by the
circuit court——the court may enter a restitution order and enforce it while the
defendant remains on probation. See
Herr v. Lanaghan, 2006 WI App 29, ¶¶19-20, __ Wis. 2d __, 710
N.W.2d 496.
¶39 In Walters the court of appeals held that a civil settlement
does not restrict the power of a court to order a defendant to pay restitution after
the defendant and victim settle. Walters,
224 Wis. 2d at 899. Like the
present case, Walters arose out of an automobile accident for which the
defendant was convicted of operating an automobile while intoxicated. Id.
The defendant in Walters argued that a civil settlement, which
included a release for "all claims and damages" that resulted from
the accident, should prevent a circuit court from being able to enter a
restitution order. Id. at
899-900. The court of appeals rejected
the defendant's contention, explaining that restitution is a remedy that
belongs to the State and that "a victim has no independent claim to
restitution which he or she can release . . . ." Id. at 904-05. Significantly, in Walters, the
defendant made no attempt to prove that enforcement of the restitution order
would result in a double recovery for the victim. Id. at 899-900.
Moreover, unlike the present case, Walters did not address what
happens to a restitution order upon the termination of probation.
¶40 In Olson the court of appeals confronted a sequence of
events the reverse of that presented in Walters. In Olson the criminal court entered a
restitution order before the parties entered into a settlement
agreement. Olson, 202 Wis. 2d at
380. After a subsequent settlement, the
victim attempted to enforce the outstanding restitution order. Id. at 380. The court of appeals acknowledged that a civil settlement and a
pre-existing restitution order could affect one another. Id. at 383. The court of appeals explained that under
Wis. Stat. § 973.20(8) restitution payments may offset the
amount of a judgment or settlement in a civil action. Id. Before this
can occur, however, the party seeking setoff must show that the victim stood to
reap a double recovery. Id. The court of appeals concluded that because
the defendant had not met this burden, the parties' settlement had no effect
upon enforcement of the restitution order.
Id. at 383-84.
¶41 Finally, in a letter to the court that called our attention to
supplemental authority, Huml invokes Herr. In Herr the defendant sought to reopen a civil judgment
entered pursuant to a settlement agreement to offset it by the amount of the
restitution order imposed by the criminal court after the parties had
settled. Herr, 710
N.W.2d 496, ¶6. The court of
appeals affirmed the circuit court's decision to reopen the civil judgment, but
reversed and remanded the circuit court's decision to grant the defendant the
offset. Id., ¶16. The court of appeals held that before setoff
was appropriate, the circuit court first had to determine whether the damages
covered in the civil judgment were the same as the special damages
covered in the restitution order (i.e., would the result of enforcing both the
restitution order and the civil judgment be double recovery). Id., ¶20.
¶42 Walters, Olson, and Herr do not address what
happens to unpaid restitution upon the completion of probation. Accordingly, we agree with Vlazny that
Huml's reliance on these cases is misplaced.
We decline Huml's invitation to extend the holdings of these cases——that
a defendant must prove double recovery before a settlement agreement can affect
a restitution order——to proceedings after the defendant is released from
probation.
¶43 Huml's position is further undermined by State v. Davis, 127
Wis. 2d 486, 381 N.W.2d 333 (1986). Thelmer Davis was placed on probation for five years and ordered
to pay restitution for committing welfare fraud. Id. at 487-88.
Three times the circuit court extended Davis's probation because
restitution remained unpaid. Id.
at 489-491. This court concluded it was
inappropriate to extend probation when the only reason to do so was to collect
unpaid restitution. Id. at
497-98. We explained the circuit
court's decision to extend Davis's probation was an erroneous exercise of
discretion because it effectively transformed the criminal justice system into
a collection agency "to collect what eventually became no more than a
civil debt." Id. at
499. Davis, therefore, stands
for the proposition that once the penal and rehabilitative purposes of
restitution have been served, only a civil debt remains. Id.; see also Huggett,
83 Wis. 2d at 803-04.
¶44 It is true that restitution in a criminal case is a remedy that
belongs to the state, not to the victim.
Walters, 224 Wis. 2d at 904. Termination of probation, however, signals the state's disavowal
of any penal or rehabilitative interests.
Cf. State v. Jackson, 128 Wis. 2d 356, 365-66,
382 N.W.2d 429 (1986); Huggett, 83 Wis. 2d at
803-04. Thereafter, only the goal of
compensating the victim remains. This
is an objective adequately accomplished by entry of a civil judgment, which can
be enforced through civil enforcement mechanisms. Consequently, it is consistent with Wisconsin precedent to allow
a victim, in anticipation of the defendant completing probation, to release her
right to enforce any judgment derived from unpaid restitution as part of a
settlement agreement.
2. Federal Case Law
¶45 Wisconsin Stat. § 973.20(1r) was based in part on the
federal VWPA, specifically 18 U.S.C. § 3663(h) (1982 & Supp. IV 1987). See Judicial Council Committee Note,
1987, Wis. Stat. § 973.20.
Consequently, Huml relies to a considerable extent upon federal case law
interpreting this provision.
¶46 18 U.S.C. § 3663(h) provided:
An order of restitution may be enforced by the United
States in the manner provided in sections 1812 and 1813 or in the same manner
as a judgment in a civil action, and by the victim named in the order to
receive the restitution in the same manner as a judgment in a civil action.
As the Judicial Council note
indicates, the phrase, "in the same manner as a judgment in a civil
action[]" in Wis. Stat. § 973.20(1r) was imported from 18
U.S.C. § 3663(h). Despite copying
some language from 18 U.S.C. § 3663(h), there is a critical difference
between Wis. Stat. § 973.20(1r) and 18 U.S.C.
§ 3663(h). Unlike the analogous
Wisconsin provisions, neither 18 U.S.C. § 3663 nor any other section of
the VWPA contains a provision that directs a court to enter a judgment against
the defendant for any unpaid restitution when probation ends. Consequently, the federal cases cited by
Huml merely hold (1) that the availability of civil enforcement mechanisms does
not convert a restitution order into a civil judgment; and (2) the existence of
a settlement agreement cannot preclude a district court from entering a
restitution order. See e.g., Lyndonville
Sav. Bank & Trust Co. v. Lussier, 211 F.3d 697, 703 (2d. Cir. 2000)
("§ 3663 contained no suggestion that a court may convert a
restitution order into a civil judgment or modify a restitution order in a
civil suit."); United States v. Karam, 201 F.3d 320, 328 (4th Cir.
2000); United States v. Timilty, 148 F.3d 1, 4 (1st Cir. 1998); United
States v. Sheinbaum, 136 F.3d 443, 448 (5th Cir. 1998); United States v.
Johnson, 983 F.2d 216, 220 (11th Cir. 1993); United States v. Cloud,
872 F.2d 846, 854 (9th Cir. 1989); United States v. Satterfield, 743
F.2d 827, 839 (11th Cir. 1984).
Contrary to Huml's assertion, because of the differences in statutory
language, cases interpreting 18 U.S.C. § 3663(h) are of little, if any,
assistance in interpreting Wis. Stat. §§ 973.09(3)(b) and
973.20(1r).
C. Public Policy
¶47 Finally, Vlazny's interpretation of Wis. Stat. §§ 973.09(3)(b)
and 973.20(1r) is consistent with good public policy. First, there is considerable value in permitting a victim to
release her interest in a judgment derived from a restitution order because it allows
the victim to settle the case and replace an uncertain, future recovery with a
certain, immediate recovery.
¶48 Second, permitting a release gives a victim an additional source of
leverage to negotiate a favorable settlement.
¶49 Third, there are safeguards to promote the recovery of restitution
by victims. On the civil side, in most
situations where a substantial dollar amount is at stake, a victim will be
represented by an attorney when negotiating a settlement. Preserving the right to enforce a judgment
derived from a restitution order, therefore, should be as simple as including
an express exception in the settlement agreement. On the criminal side, because probation can be extended if a
defendant with the ability to pay fails to make good faith efforts to comply
with a restitution order, Huggett, 83 Wis. 2d at 803, there
should be little concern that defendants will be able to duck their restitution
obligations. Furthermore, if
restitution would result in double recovery for the victim, a circuit court can
still enter a restitution order, "[i]f justice so requires," that
imposes an obligation upon the defendant to "reimburse any insurer, surety
or other person who has compensated a victim for a loss otherwise compensable
under this section."
Wis. Stat. § 973.20(5)(d).
¶50 For all these reasons, we conclude that a civil settlement
agreement can have no effect upon a restitution order while the defendant is on
probation unless the circuit court first finds that continued enforcement of
the restitution order would result in a double recovery for the victim. After a defendant is released from probation
and any unpaid restitution becomes a civil judgment, however, a settlement
agreement between the victim and the defendant may preclude the victim from
enforcing the judgment.
IV.
INTERPRETATION OF THE SETTLEMENT AGREEMENT
¶51 Having determined that a settlement agreement can preclude the
enforcement of a judgment derived from a restitution order, we consider whether
the terms of the settlement agreement between Vlazny and Huml have this effect.
¶52 The lodestar of contract interpretation is the intent of the
parties. Dieter v. Chrysler Corp.,
2000 WI 45, ¶15, 234 Wis. 2d 670, 610 N.W.2d 832. In ascertaining the intent of the parties,
contract terms should be given their plain or ordinary meaning. Goldstein v. Lindner, 2002 WI App
122, ¶12, 254 Wis. 2d 673, 648 N.W.2d 892. If the contract is unambiguous, our attempt
to determine the parties' intent ends with the four corners of the contract,
without consideration of extrinsic evidence.
Id.
¶53 Vlazny contends the settlement agreement is clear; it bars Huml
from enforcing "any or all claims, actions, causes of action, demands,
rights, [or] damages," without any language to exclude judgments derived
from unpaid restitution from the scope of the settlement. It discharges "in full" past,
present, and future claims. In using
such sweeping words as "any," "all," and
"whatsoever," the settlement is "global" in its
coverage. Huml does not dispute that
the breadth of the language in the settlement agreement encompasses her
judgment against Vlazny. Rather, she
depends upon the argument that a judgment derived from a restitution order
retains its nature as restitution and can never be affected by a settlement
agreement, unless the defendant establishes that the victim would receive a
double recovery.
¶54 We have already rejected Huml's argument. Once unpaid restitution imposed by a restitution order is reduced
to a civil judgment under Wis. Stat. § 973.09(3)(b), a
settlement agreement may take effect and preclude enforcement of the judgment.
¶55 We conclude that the global settlement agreement between Huml and
Vlazny precludes Huml from enforcing the judgment for $107,900.46. The settlement agreement is a fully
integrated contract intended to be the final expression of Huml and Vlazny's
agreement. Absent ambiguity, it is
improper to consider extrinsic evidence of intent. Dairyland Equip. Leasing, Inc. v. Bohen, 94 Wis. 2d 600,
607, 288 N.W.2d 852 (1980); Wis. End-User Gas Ass'n v. PSC, 218 Wis. 2d
558, 567, 581 N.W.2d 556 (Ct. App. 1998).
Because we conclude the plain language of the settlement agreement
released all Huml's claims and rights to damages arising from the accident, we
will not consider extrinsic evidence of a contrary intent. This settles the issue.
V.
CONCLUSION
¶56 We conclude that a civil settlement agreement can have no effect
upon a restitution order while the defendant remains on probation, unless the
circuit court finds that enforcing the restitution order in addition to the
settlement agreement would result in a double recovery for the victim. After a defendant is released from
probation, however, and any unpaid restitution under the restitution order is
converted to a civil judgment, a settlement agreement between the victim and
defendant may——depending upon its terms——preclude the victim from enforcing the
judgment. We conclude that the global
settlement agreement that Huml entered into with Vlazny precludes her from
enforcing the judgment converted from the restitution order.
By the Court.—The judgment of the circuit court
is reversed.
