COURT OF APPEALS DECISION DATED AND FILED |
NOTICE |
October 21, 1998 |
This opinion is subject to further
editing. If published, the official version will appear in the bound volume
of the Official Reports. |
Marilyn L. Graves Clerk, Court of Appeals of Wisconsin |
A party may file with the Supreme Court
a petition to review an adverse decision by the Court of Appeals. See § 808.10 and Rule 809.62, Stats. |
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STATE OF WISCONSIN |
IN COURT OF APPEALS DISTRICT II |
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TKO,
Ltd., a Wisconsin Corporation, d/b/a
Modern Cash Register Systems,
Plaintiff-Respondent, v. Wayne
Manternach and Grayfield
Development, LLC.,
Defendants-Appellants. |
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APPEAL from a judgment of the circuit court for Winnebago County: ROBERT A. HAASE, Judge. Affirmed in part; reversed in part and cause remanded.
Before Snyder, P.J., Nettesheim and Anderson, JJ.
PER CURIAM. Wayne Manternach
and Grayfield Development, LLC. (Grayfield) appeal from a summary judgment
granted in favor of TKO, Ltd. On
appeal, Grayfield contends that the summary judgment was in error both as to
TKO’s claim and Grayfield’s counterclaims.
We conclude that the circuit court properly granted summary judgment on
the counterclaims, but erred in granting it on TKO’s original claim. We therefore reverse the summary judgment in
favor of TKO on its claim, but affirm the judgment regarding the
counterclaims. Resultantly, the award
of attorney’s fees is also reversed because the appellate issue stemming from
it is rendered moot.
Grayfield contracted with TKO for restaurant management software and
equipment. Grayfield made an initial
payment on the system, which was delivered and went “live.” Manternach averred that the system did not
operate as expected. Grayfield
ultimately purchased another system from a different supplier and did not pay the
balance due on the contract. TKO sued
on the contract; Grayfield brought counterclaims of breach of warranty, breach
of implied warranty, intentional misrepresentation, negligent misrepresentation
and violation of § 100.18,
Stats. The circuit court granted summary judgment in TKO’s favor, and
this appeal followed.
Grayfield first contends that the circuit court erred in granting
summary judgment on TKO’s claim because the issue of whether the system was in
good working order remained unresolved.
We agree. Although it is true
that Grayfield’s admissions by default are not without pertinence to this
question, we are unconvinced that they effectively compelled summary judgment
here.
TKO warranted that “upon delivery the equipment shall be in good
working order.” A Grayfield representative averred that they began to use the system on
about July 31, 1996, that serious problems were present from the start, that
TKO was notified by phone of the problem on the first day the system was used,
and that a TKO representative “was at the restaurant about four times between
mid-August and November, 1996, trying to repair or work on the system so that
the cash register would communicate with the back office computer”[1]
and that “[h]e was never able to fix the problem.”
On summary judgment, the moving party has the
burden to establish the absence of a disputed issue as to any material
fact. See Grams
v. Boss, 97
Wis.2d 332,
338, 294
N.W.2d 473,
477 (1980). Doubts as to the existence of a genuine
issue of material fact should be resolved against the party moving for summary
judgment. See id. at
338-39, 294 N.W.2d at 477. On the
strength of the averments made on behalf of Grayfield, we must conclude that an
issue of material fact exists concerning TKO’s warranting the system to be in
“good working order.”
On this point, TKO contends that Grayfield waived
any claim under the warranty by failing to make a written claim within ten days
of the delivery of the system. We do
not agree. Although the contract does
specify that “[a]ll claims for goods shall be deemed waived unless made in
writing and delivered to MODERN CASH REGISTER SYSTEMS within ten days after
delivery of goods to Customer,” that provision is not part of the warranty
paragraph. Rather, the warranty
explicitly runs for ninety days from delivery
and makes no mention of written notice as a means of invoking the
warranty. We are unconvinced that the
ten-day limit on the claim for goods subverts the plain language of the
warranty granting ninety days. We
therefore reverse the circuit court’s grant of summary judgment on TKO’s
contract claim.
We turn now to Grayfield’s challenges to the
dismissal of its five counterclaims. We
begin by noting that Grayfield has not argued on appeal, in either its
brief-in-chief or in reply, from its
express or implied warranty counterclaims.
We deem them abandoned. See
State
v. S.H., 159
Wis.2d 730,
738, 465
N.W.2d 238,
241 (Ct.
App. 1990). We conclude that the remaining three
counterclaims were all properly dismissed by virtue of Grayfield’s admission
that it did not rely upon any written or oral statements by TKO beyond the
contract itself.
We first address what Grayfield denominates as its counterclaim for
“fraudulent misrepresentation.”[2] While Grayfield cites no authority for its
definition, we note that any of the three varieties of misrepresentation
requires that the party must rely upon the representation to its damage. See Ollerman
v. O'Rourke Co., 94
Wis.2d 17,
24-25, 288
N.W.2d 95,
99 (1980). Here, one of Grayfield’s admissions was that
“[p]ursuant to the Sales Contract, the purchaser did not rely on any statements
of plaintiff, either written or oral, that are not made a part of said Sales
Contract, either by the provisions of paragraphs 4 or 9 thereof, or expressly
by the terms of the contract document.”
Grayfield has therefore admitted that it did not rely upon any
representation made by TKO.
Grayfield attempts to distinguish this admission by resort to the
“[p]ursuant to the Sales Contract” phrase; this attempt is unavailing. Grayfield argues that because of this
qualifier, “the admission only states that the contract says what it says” and
“does no more than raise the question of what the agreement was between the
parties as to the system’s capabilities.”
We cannot agree. The admission states that Grayfield did not
rely on any written or oral statements of TKO’s beyond the sales contract itself. Reliance is an element of a
misrepresentation claim. See id. Grayfield’s admission is therefore fatal to
its misrepresentation counterclaim.
Turning to Grayfield’s statutory fraudulent
representation counterclaim, made pursuant to § 100.18(1), Stats., we note that the admission concerning a lack of reliance is again
dispositive. Grayfield argues that a
claim under this statute does not require reliance. We cannot agree. In Tim
Torres Enterprises, Inc. v. Linscott, 142
Wis.2d 56,
416
N.W.2d 670
(Ct.
App. 1987),
this court stated that “[s]ection 100.18(11)(b)2, Stats., states that ‘[a]ny
person suffering pecuniary loss because of a violation of this section by any
other person may sue in any court of competent jurisdiction and shall recover
such pecuniary loss.’ We interpret this
section as requiring a causal connection between the practices found
illegal and the pecuniary losses suffered.”
Id. at 70, 416 N.W.2d at 675 (emphasis added). While this interpretation does not use the
term “reliance,” we conclude that, at least for the case at bar, a causal
connection is tantamount to reliance.[3] We therefore hold that the circuit court
properly dismissed Grayfield’s § 100.18
counterclaim.
Finally, we address the award of attorney’s fees. The circuit court awarded attorney’s fees
pursuant to the sales contract, although neither party identifies the
particular contractual terms involved.
In any event, because of our reversal of TKO’s underlying claim, we deem
the attorney’s fee award premature, and therefore moot. See Warren
v. Link Farms, Inc., 123
Wis.2d 485,
487, 368
N.W.2d 688,
689 (Ct.
App. 1985).[4]
By the Court.—Judgment
affirmed in part; reversed in part and cause remanded.
This opinion will not be published.
See Rule
809.23(1)(b)5, Stats.
[1] We note that one of Grayfield’s admissions was that TKO never represented to Grayfield that the system “was capable of simultaneously reporting sales made at the cash registers to the computer located in the office of the restaurant.” However, in its reply to Grayfield’s counterclaims, TKO admitted that it represented to Grayfield that the system could be programmed to report sales from the front cash registers to the kitchen and the office. Again, a disputed issue of material fact exists.
[2] It is of no consequence whether Grayfield intends “fraudulent misrepresentation” as a blanket term for both its intentional and negligent misrepresentation counterclaims set forth in its answer or as a synonym for intentional misrepresentation. See Ollerman v. O'Rourke Co., 94 Wis.2d 17, 24, 288 N.W.2d 95, 99 (1980). Both torts contain the element of reliance. See id. at 25, 288 N.W.2d at 99.
[3] Grayfield attempts to distinguish this language by stating that “Grayfield could establish damage without any reliance on the representations, simply by showing a causal link between the false representations and pecuniary damage. While such an action may be difficult, it is not impossible.” However, Grayfield makes no attempt at suggesting how that might be accomplished.
[4] While we need not and do not reach the merits of Grayfield’s challenge to the circuit court’s refusal to grant a hearing on attorney’s fees, we note that where, as here, a party is explicitly required only to “voice any objections to the amounts,” we consider it prudent for the court to entertain such objections, even when made only by letter.