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COURT OF APPEALS
DECISION
DATED AND FILED
June 2, 2010
David
R. Schanker
Clerk of Court of Appeals
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NOTICE
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This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official
Reports.
A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See Wis. Stat. § 808.10 and Rule 809.62.
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Appeal No.
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STATE OF WISCONSIN
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IN COURT OF
APPEALS
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DISTRICT III
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Diocese of Superior,
Plaintiff,
v.
Swan & Associates, Inc. and Robert Swanfeld,
Defendants-Third-Party
Plaintiffs-Appellants,
American Safety Casualty Insurance Company,
Defendant-Respondent,
v.
Benson Electric Company and Western National
Insurance Company,
Third-Party
Defendants.
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APPEAL
from a judgment and an order of the circuit court for Douglas County: GEORGE
L. GLONEK, Judge. Affirmed in
part; reversed in part and cause remanded with directions.
Before Hoover,
P.J., Peterson and Brunner, JJ.
¶1 PER CURIAM. Swan & Associates, Inc., and
Robert Swanfeld (collectively Swan) appeal a judgment and an order dismissing
their coverage claims against American Safety Casualty Insurance Company. Swan argues the circuit court erred by
enforcing a Georgia
choice-of-law provision in the insurance agreement. We affirm the court’s choice-of-law
determination, but remand for a determination of coverage under Georgia
law.
BACKGROUND
¶2 The Cathedral of Christ the King in Superior, Wisconsin,
is approximately seventy-five years old.
By 2004, the building needed extensive restoration. The
Diocese of Superior, which suspected asbestos-containing materials were used
during remodeling in the 1950s, hired Swan & Associates, Inc., a Minnesota corporation,
to test the cathedral before renovation.
Testing in limited areas revealed asbestos, but Swan allegedly performed
no additional testing on the remainder of the building. The Diocese asserts that on February 15,
2004, employees of Benson Electric Company cut into cornices in the cathedral,
releasing asbestos particles that contaminated the church.
¶3 The Diocese filed suit on April 27, 2005, alleging Swan and
its insurer, American Safety, were liable for breach of contract, negligence,
and negligent misrepresentation. American
Safety denied coverage and sought declaratory and summary judgment. Swan then filed its own motion for summary
judgment, arguing Wisconsin law required
coverage. American Safety objected to
application of Wisconsin law, noting the following choice-of-law provision in the
insurance agreement: “This policy and all additions to, endorsements
to, or modifications of the policy shall be interpreted under the laws of the
State of Georgia.”
¶4 The circuit court determined Wisconsin
law did not apply, but did not identify the applicable law. Instead, it requested further briefing from
Swan addressing which nonforum law controlled and American Safety’s obligations
under that law. Swan’s supplemental
brief argued for application of Minnesota
law. In response, American Safety again sought
enforcement of the agreement’s Georgia
choice-of-law provision.
¶5 Following supplemental briefing, the circuit court granted
American Safety’s motion for declaratory and summary judgment. It agreed Georgia law governed the dispute. It also viewed Swan’s failure to brief the
issue of coverage under Georgia
law as a concession:
Although [Swan’s] Supplemental Brief addresses at
length the insurer’s alleged duty to defend and indemnify based upon an
application of Minnesota law, [Swan] again present[s] no legal authority or
argument to support any claim that [American Safety] has a duty to defend and
indemnify its insureds based upon an application of Georgia law.
The Court views this as an acknowledgement by [Swan]
that [American Safety] has no duty to defend or indemnify the insured … if Georgia law (rather than Minnesota
or Wisconsin
law) applies.
DISCUSSION
¶6 This appeal requires us to determine whether the circuit
court properly selected Georgia
law as controlling and granted summary judgment. The choice-of-law inquiry presents a question
of law subject to independent appellate review.
Drinkwater v. American Family Mut. Ins. Co., 2006 WI 56, ¶14,
290 Wis. 2d
642, 714 N.W.2d 568. We review a grant
of summary judgment de novo, applying the same standard as the circuit
court. See Green Spring Farms v.
Kersten, 136 Wis. 2d
304, 315-16, 401 N.W.2d 816 (1987).
Summary judgment is appropriate where no genuine issue of material fact
exists and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2);
Kersten, 136 Wis. 2d at 315.
¶7 In general, Wisconsin courts will enforce parties’ express
agreement that the law of a particular jurisdiction shall control their
contractual relations. Bush
v. National Sch. Studios, Inc., 139 Wis. 2d 635, 642, 407 N.W.2d 883
(1987). Allowing parties some degree of
autonomy to stipulate controlling law “promotes certainty and predictability in
contractual relations ….” Id. (citing
Willis L. M. Reese, Choice of Law in Torts and Contracts and
Directions for the Future, 16 Colum.
J. Transnat’l L. 1, 22-24 (1977)).
The right is not unqualified, however; parties are not permitted,
through their contractual selection of applicable law, to disregard the
“important public policies of a state whose law would be applicable if the
parties choice of law provision were disregarded.” Id.
¶8 Swan argues we must look to Minnesota
public policy because, absent the choice-of-law provision, Wisconsin courts
would apply Minnesota
law. Absent agreement by the parties,
the law of the forum presumptively applies unless it becomes clear that
nonforum contacts are of greater significance.
Drinkwater, 290 Wis. 2d
642, ¶40. Even if Swan is correct, and Minnesota contacts are clearly of greater significance, Minnesota public policy
does not require abrogation of the parties’ choice of law. Citing Minn.
Stat. § 60A.08(4) (2009), and
Onstad
v. State Mutual Life Assurance Co., 32 N.W.2d 185 (Minn. 1948), Swan
contends the choice-of-law provision contravenes Minnesota public policy
deeming insurance contracts “made” in Minnesota. Section 60A.08(4)
simply provides, as relevant, “All contracts of insurance on property, lives,
or interests in this state, shall be deemed to be made in this state,” and does
not, by its plain terms, prohibit choice-of-law agreements. Further, Onstad did not involve a
conflict-of-laws provision, but an aviation exclusion rider prohibited under
then-existing Minnesota
law. Onstad, 32 N.W.2d at 186-87. Neither authority establishes an important
public policy flouted by choice-of-law agreements. Instead, Minnesota courts have a “longstanding policy
of enforcing contractual choice of law provisions.” Hagstrom v. American Circuit Breaker Corp.,
518 N.W.2d 46, 49 (Minn. Ct. App. 1994); see
also Medtronic, Inc. v. Advanced Bionics Corp., 630 N.W.2d 438, 454
(Minn. Ct. App. 2001).
¶9 While we recognize Minnesota
courts will ordinarily give effect to the parties’ agreement, we have not
addressed any alleged substantive conflicts between Georgia and Minnesota law that might lead a Minnesota court to apply the law of its own
forum for public policy reasons. This omission
falls squarely on Swan, whose brief contains only the most cursory analysis of
the purported conflicts. Swan’s
brief-in-chief cites only two Georgia
authorities. Swan does not explain what
these two authorities say, nor analyze how they conflict with Minnesota law,
preferring instead to simply note each “does not appear” to adequately protect
Minnesota insureds. These conclusory
arguments do not merit our attention. See M.C.I., Inc. v. Elbin, 146 Wis. 2d
239, 244-45, 430 N.W.2d 366 (Ct. App. 1988) (we need not consider undeveloped
arguments). We therefore conclude
Georgia
law governs resolution of this insurance dispute.
¶10 While we affirm the circuit court on the choice-of-law issue,
we disagree with its decision to treat Swan’s failure to brief coverage under Georgia law as
a concession. The court’s request for
supplemental briefing permitted Swan to address two issues: (1)
which law, other than Wisconsin’s, applied to
the coverage dispute; and (2) “whether [American Safety] has a duty to defend
and indemnify the insureds if Wisconsin law
does not apply.” Swan submitted a brief
arguing for application of Minnesota
law, which purportedly requires coverage.
While it was perhaps strategically unwise not to address coverage under Georgia
law, Swan’s interpretation of the court’s request was reasonable. We therefore remand for further proceedings
consistent with this opinion, including a determination of coverage under Georgia
law.
By the Court.—Judgment and order
affirmed in part; reversed in part and cause remanded with directions. No costs on appeal.
This
opinion will not be published. See Wis. Stat. Rule 809.23(1)(b)5.