Nancy A. Scobie v. Patrick S. Scobie

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
February 14, 2023
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2020AP1937 Cir. Ct. No. 2017PR20

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT III

IN THE MATTER OF THE 2015 VOTING TRUST AGREEMENT FOR CERTAIN
SHAREHOLDERS OF MASON COMPANIES, INC.:

NANCY A. SCOBIE, INDIVIDUALLY AND AS TRUSTEE OF THE
WILLIAM M. SCOBIE AND NANCY A. SCOBIE REVOCABLE TRUST
AND TIMOTHY F. SCOBIE,

PLAINTIFFS-APPELLANTS-CROSS-RESPONDENTS,

V.

PATRICK S. SCOBIE AND LORI A. GEISSLER,

DEFENDANTS-RESPONDENTS,

DANIEL J. HUNT,

DEFENDANT-RESPONDENT-CROSS-APPELLANT.

APPEAL and CROSS-APPEAL from an order of the circuit court
for Chippewa County: STEVEN P. ANDERSON, Judge. Affirmed.
No. 2020AP1937

Before Stark, P.J., Hruz and Gill, JJ.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).

¶1 PER CURIAM. This lawsuit arises out of a family dispute over a
voting trust created in 2015 by the shareholders of Mason Companies, Inc.
Nancy A. Scobie and Timothy (“Tim”) F. Scobie brought suit against Patrick
(“Pat”) S. Scobie, Lori A. Geissler, and Daniel (“Dan”) J. Hunt1 for their
“orchestrated and unlawful scheme to secure control over the direction and
management of [Mason] for their personal benefit” by creating the voting trust
“through … misrepresentations, deception and misconduct.” In response, Dan
counterclaimed against Nancy and Tim for abuse of process.

¶2 Nancy and Tim appeal from the circuit court’s order denying their
motion for partial summary judgment on their claims, granting the Defendants’
motions for summary judgment, and dismissing Nancy and Tim’s claims in their
entirety with prejudice. They present five arguments on appeal: (1) the court
erred by granting summary judgment on their claim to void the voting trust
because of Pat’s misrepresentations; (2) the court erred by concluding that Nancy
had no marital property interest in her husband’s stock; (3) the voting trust is void
for lack of a proper purpose; (4) Pat and Lori breached their fiduciary duties to
Tim and Nancy as trustees of the voting trust; and (5) the court erred by allowing
costs to the Defendants not authorized by law. The court also denied Dan’s

1
For ease of reading, we will refer to the parties in this appeal and cross-appeal by their
first names or a shortened version of their first name as utilized by the parties. We will also refer
to Pat, Lori, and Dan collectively as “the Defendants.”

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motion for summary judgment on his abuse of process counterclaim, and Dan
cross-appeals on that basis.

¶3 We reject the majority of Nancy and Tim’s arguments and affirm the
circuit court’s rulings. We also affirm the court’s dismissal of Dan’s abuse of
process counterclaim. On the issue of costs, however, we conclude that this court
lacks appellate jurisdiction to consider whether the circuit court erroneously taxed
some disbursements not authorized by WIS. STAT. § 814.04(2) (2019-20).2

BACKGROUND

¶4 Mason is a family-run corporation based in Chippewa Falls,
Wisconsin, that sells footwear and apparel. Pertinent to this appeal and
cross-appeal, Mason’s stock is divided into two classes: Class A voting shares and
Class B nonvoting shares.3 The majority of the parties in this dispute—Nancy,
Tim, Pat, and Lori—each own a percentage of Class A voting shares in Mason.

¶5 Nancy was married to William (“Bill”) Mason Scobie for fifty-two
years. Bill, who died on July 29, 2016, had previously served as Mason’s
president, CEO, and chairman of the board. For her part, Nancy never worked at
Mason or served on its board of directors. At the time of his death, Bill owned
34.65% of all outstanding Class A shares, which he inherited from his family
members. Nancy and Bill are Pat and Tim’s mother and father, respectively.

2
All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise
noted.
3
Only Class A shareholders vote to elect Mason’s board of directors, who, in turn,
appoint Mason’s officers and managers. Mason’s shareholders are mostly descendants of the
individuals who founded Mason in 1904.

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¶6 Pat and Tim each own 25.13% of the outstanding Class A shares of
Mason, and they are both attorneys. Bill and Nancy gifted the brothers their
Class A shares in 1993 and between December 2006 and August 2010.4 Pat is an
estate planning attorney who has been on Mason’s board of directors since 2004
and has served as chairman since 2009. Tim served on the board of directors from
2009 until February 2018 and served as Mason’s vice president and general
counsel until February 2017.

¶7 Lori is Pat and Tim’s cousin. Lori is vice president of purchasing at
Mason, and she has served on the board since 2006. Lori owns 5.26% of the
outstanding Class A shares, which she received as a gift from her mother, one of
Bill’s sisters.

¶8 Dan is the only party to this dispute who is not a member of the
extended Mason family. In 2004, Dan succeeded Bill as CEO and president of
Mason, and he retired in 2019. Dan has never been a shareholder of Mason.

¶9 The dispute in this case centers around a voting trust agreement
executed by Bill, Pat, Tim, and Lori on June 12, 2015 (the “2015 Voting Trust” or
the “Agreement”). Nancy was involved in negotiating and drafting the 2015
Voting Trust, but Dan was not. The Agreement was drafted with the assistance of
Attorney Mark Bradley. Lori was also represented by legal counsel during the
negotiations.

4
Nancy and Tim argue that both Bill and Nancy gifted these shares. As we will explain
later, Bill’s Class A shares of Mason were his individual property.

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¶10 The 2015 Voting Trust’s purpose, according to its terms, was “to
secure continuity and stability of the voting of the shares of stock in the Company
contributed by the Shareholders.” Under the Agreement, Bill, Pat, Tim, and Lori
each transferred all of their respective Class A shares into the 2015 Voting Trust,
which resulted in more than ninety percent of the Class A shares of Mason
residing in the 2015 Voting Trust.5 Bill, Pat, Tim, and Lori appointed themselves
as trustees with exclusive authority to vote the Class A shares. Nancy was not
made a trustee, and the Agreement provided that upon Bill’s death, his Class A
shares would remain in the 2015 Voting Trust under the control of Tim, Pat, and
Lori as the three remaining trustees. Following Bill’s death, however, Bill’s
beneficial interest in his Class A shares transferred to the William and Nancy
Scobie Revocable Trust (the “Bill & Nancy Trust”), which Nancy would control
as surviving spouse and successor trustee and beneficiary. The 2015 Voting
Trust’s initial term was twelve years, which the majority of trustees could extend
for an additional ten years, or until 2037.

¶11 Bill passed away a little over a year after executing the 2015 Voting
Trust. Seven months later, in February 2017, after a vote of Mason’s board of
directors, Dan terminated Tim as vice president and general counsel of Mason.
The next year, in January 2018, Tim was removed from Mason’s board of
directors.

5
Bill, Pat, and Tim had previously executed a similar trust agreement in 2006 (the “2006
Voting Trust”). Tim and Pat each contributed the Class A shares they had received from their
father into the 2006 Voting Trust, and Bill, Tim, and Pat were made trustees, with the exclusive
authority to vote the Class A shares. Nancy was not a trustee in the 2006 Voting Trust. On
June 12, 2015, Bill, Pat, and Tim terminated the 2006 Voting Trust by executing a “Deed of
Termination” in order to transfer those Class A shares into the 2015 Voting Trust.

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¶12 Nancy initiated this lawsuit against the Defendants in March 2017,
and Tim later joined as a plaintiff. The joint amended petition and complaint
sought to void or terminate the 2015 Voting Trust based on five counts and eleven
grounds.6 According to Nancy and Tim, the intended purpose of the 2015 Voting
Trust was for the Class A shareholders to work together to develop a consensus
and vote the shares “in the same manner.” Toward that purpose, Nancy and Tim
claim that while discussing how the 2015 Voting Trust would work, Bill asked
what would happen if Tim and Pat could not agree on a matter requiring a vote of
Class A shares after Bill’s death. Pat’s response, according to Nancy and Tim,
was that Pat and Tim would terminate the 2015 Voting Trust if they could not
agree. Nancy and Tim claim, however, that was never Pat’s plan. Instead, they
assert that Pat and Lori’s intention was “to vote the shares to prevent Tim from

6
In Count 1, Nancy and Tim sought a declaration that the 2015 Voting Trust is void
based on: (1) the Defendants’ “improper or illegal” “hidden purpose … to prevent shareholders
from voting their shares in order for [the Defendants] to maintain control of Mason for their own
benefit”; (2) fraud as to Nancy’s alleged interest in Bill’s Class A shares; (3) Bill and Tim not
seeing a final version of the 2015 Voting Trust agreement before signing; (4) there being no
consideration for the creation of the 2015 Voting Trust; (5) the Defendants fraudulently inducing
Bill and Tim to enter into the 2015 Voting Trust; (6) Lori’s failure to obtain control over
additional shares (owned by another family member) to add to the 2015 Voting Trust;
(7) termination of the 2006 Voting Trust being obtained through fraud committed by Pat; and
(8) Bill lacking the capacity to execute the 2015 Voting Trust.

In Count 2, Nancy and Tim sought a declaration, in the alternative, that the 2015 Voting
Trust should be terminated as it no longer has a legitimate purpose and that any possible
legitimate purpose had become impossible or been frustrated. In Count 3, Nancy and Tim argued
that to the extent the 2015 Voting Trust is not void, the 2006 Voting Trust’s termination should
be declared void because Pat obtained termination of that trust through fraudulent representations
made to Tim.

In Count 4, Nancy and Tim argued that to the extent the 2015 Voting Trust is not void or
terminated, Nancy has the right to appoint a successor trustee for Bill, and they sought a
declaration to that effect. Finally, Count 5 of the petition alleged that the Defendants breached
their fiduciary duties of loyalty and care to Mason’s shareholders and that Pat and Lori, as
trustees of the 2015 Voting Trust, also owe fiduciary duties to Nancy and Tim, individually.

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exercising any power in the direction of the company, and to ensure their own
control over Mason, including security in their own lucrative positions.”7

¶13 In response to Nancy and Tim’s suit, Dan filed a counterclaim
alleging abuse of process. He argued that Nancy and Tim’s claims were frivolous,
made in bad faith, and filed “as a means to seek revenge against” Dan for his
“perceived participation in the termination” of Tim as general counsel and Tim’s
removal from Mason’s board of directors.

¶14 Nancy and Tim moved for partial summary judgment on their claims
that the 2015 Voting Trust was void and that it should be terminated. The
Defendants filed cross-motions for summary judgment, seeking dismissal of all of
Nancy and Tim’s claims. Dan also moved for summary judgment on his abuse of
process counterclaim.

¶15 The circuit court ultimately granted the Defendants’ motions and
dismissed Nancy and Tim’s petition in its entirety and with prejudice. The court
concluded that Nancy and Tim had failed to show that “the purpose of the 2015
Voting Trust was to disenfranchise or defraud shareholders” or that the purpose
involved anything illegal, unlawful, or improper. According to the court, the
Agreement “was a lawful contract, negotiated with the benefit of experienced legal
counsel and sophisticated, intelligent, educated, and fully competent parties, with

7
Section 8.3 of the 2015 Voting Trust provides for proportional voting in cases of
disagreement on any issues requiring a vote. Pursuant to that section, after Bill’s death, the
remaining trustees—Tim, Pat, and Lori—each have an equal vote. Thus, Nancy and Tim explain
that Pat and Lori currently control Mason, even though they collectively own only about thirty
percent of Mason’s Class A shares, based on their control of the majority votes in the 2015
Voting Trust. Nancy and Tim, on the other hand, collectively own nearly sixty percent of
Mason’s Class A shares, but they “effectively have no vote or ability to elect directors or oversee
the management or direction of Mason.”

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consideration for its creation and execution, and a valid and unambiguous
integration clause and a valid and unambiguous non-reliance clause.” The court
further concluded that the Agreement “should be enforced according to its terms”
and without consideration of “[a]ny oral or written representations” “not included
in the four corners of the” Agreement that were allegedly made to Bill and Tim to
induce them to enter into the 2015 Voting Trust. The court also denied Dan’s
motion for summary judgment as to his abuse of process counterclaim.

¶16 Nancy and Tim appeal, and Dan cross-appeals. On November 16,
2020, Nancy and Tim filed their notice of appeal from the circuit court’s final
order entered on October 2, 2020, which granted the Defendants’ motions for
summary judgment and granted Nancy and Tim’s motion for summary judgment
on Dan’s counterclaim. The October 2 order also generally awarded the
Defendants’ costs and fees and stated that it was a final order for purposes of
appeal. On November 10, 2020, Nancy and Tim objected to the Defendants’ Bills
of Costs. After a hearing on February 22, 2021, the court entered its Order on Bill
of Costs, Taxation and Judgment on April 1, 2021. This order also stated that it
was final for purposes of appeal.

DISCUSSION

¶17 Wisconsin law provides for the creation of voting trusts. Under WIS.
STAT. § 180.0730(1),

[o]ne or more shareholders may create a voting trust,
conferring on a trustee the right to vote or otherwise act for
them, by signing an agreement setting out the provisions of
the trust and transferring their shares to the trustee. The
voting trust agreement may include any provision
consistent with the voting trust’s purpose.

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A voting trust is one type of structuring device “for maintaining control of a
corporation.” John J. Woloszyn, A Practical Guide to Voting Trusts, 4 U. BALT.
L. REV. 245, 245 (1975). “A voting trust is simply a trust of stock which is created
when participating stockholders execute a written trust agreement and, pursuant to
the agreement, endorse and transfer their stock certificates and the legal title to
their shares to a voting trustee.” Id.

I. Nancy and Tim’s Appeal

¶18 On appeal, Nancy and Tim argue that the circuit court erred by
granting summary judgment in the Defendants’ favor. We review summary
judgment decisions de novo, using the same methodology as the circuit court. Ehr
v. West Bend Mut. Ins. Co., 2018 WI App 14, ¶7, 380 Wis. 2d 138, 908 N.W.2d
486. We examine the pleadings and materials submitted by the parties to
determine whether there are material facts in dispute that would entitle the party
opposing summary judgment to trial. Palisades Collection LLC v. Kalal, 2010
WI App 38, ¶9, 324 Wis. 2d 180, 781 N.W.2d 503; WIS. STAT. § 802.08(2). For
the reasons that follow, we conclude that the circuit court properly granted
summary judgment to the Defendants in this case.

a. Nancy and Tim Failed to Establish a Claim for Fraudulent
Misrepresentation

¶19 First, Nancy and Tim argue that “Bill and Tim Scobie were
fraudulently induced into signing the 2015 Voting Trust by Pat’s representation
that if, after Bill’s death, he and Tim could not agree on how to vote the shares,
they would terminate the 2015 Voting Trust.” According to Nancy and Tim, the
circuit court “misinterpreted Pat’s representation as contradicting the express
terms of the trust when in fact the termination provision” was specifically

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modified to allow Tim and Pat to terminate the 2015 Voting Trust under these
circumstances.

¶20 In order to void the 2015 Voting Trust based on a fraudulent
representation, Nancy and Tim must establish “a false representation made with
intent to defraud and reliance by the injured party on the misrepresentation.” See
Ritchie v. Clappier, 109 Wis. 2d 399, 404, 326 N.W.2d 131 (Ct. App. 1982); see
also Williams v. Rank & Son Buick, Inc., 44 Wis. 2d 239, 242, 170 N.W.2d 807
(1969). The reliance, however, “must be ‘justifiable[,]’” and “[n]egligent reliance
is not justifiable.” Ritchie, 109 Wis. 2d at 404 (citation omitted). “The general
rule in Wisconsin, as elsewhere, is that the recipient of a fraudulent
misrepresentation is justified in relying on it, unless the falsity is actually known
or is obvious to ordinary observation.” Hennig v. Ahearn, 230 Wis. 2d 149, 170,
601 N.W.2d 14 (Ct. App. 1999) (citing Williams, 44 Wis. 2d at 245-47).
“Whether the falsity of a statement could have been discovered through ordinary
care is to be determined in light of the intelligence and experience of the misled
individual. Also to be considered is the relationship between the parties.” Ritchie,
109 Wis. 2d at 405-06 (quoting Williams, 44 Wis. 2d at 246). Where the facts are
undisputed, whether the party claiming fraud was justified in relying on a
misrepresentation is a question of law. See id. at 406.

¶21 Nancy and Tim allege that during negotiations of the 2015 Voting
Trust, Attorney Bradley held a conference call with Bill, Nancy, Tim, Pat, and
Lori to review the draft agreement. Nancy and Tim allege that during that call, Pat
represented that if he and Tim could not agree on how to vote the shares, they
would terminate the Agreement. Each shareholder would then vote their own
shares, with Nancy voting Bill’s shares as trustee of the Bill & Nancy Trust. The

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next day, Bradley circulated another draft of the 2015 Voting Trust. This draft
permitted the 2015 Voting Trust’s termination by a majority of Trustees instead of
all Trustees, as was stated in a previous draft. Nancy and Tim assert that based on
these representations, the 2006 Voting Trust was terminated, and Bill, Tim, Pat,
and Lori ratified the 2015 Voting Trust.

¶22 We agree with the circuit court’s determination that Nancy and Tim
did not justifiably rely on Pat’s alleged representation that he and Tim would
terminate the 2015 Voting Trust if they could not agree. For summary judgment
purposes, even if we assume, without deciding, that Pat made the alleged
representation, we conclude that Nancy and Tim were not justified in relying on
Pat’s representation, as the express terms of the Agreement contradict his
statement.

¶23 First, Section 8.3 of the Agreement, addressing “Proportional Voting
Rights,” provides:

Without limiting the discretion of a Trustee, it is the
Shareholders’ desire that the Trustees seek to vote all
shares of stock registered in their names under this
Agreement in the same manner. If, however, in the
exercise of discretion, the Trustees are not able to vote all
such shares in the same manner, then each Trustee shall
have the right to vote an equal portion of such shares.

Thus, per the Agreement’s plain terms, the trustees are not required to agree.
While the Agreement states a “desire” that the trustees vote their shares in the
same manner, the Agreement contains no limit on the trustees’ ability to exercise
independent discretion and judgment and vote accordingly. Nancy and Tim argue,
however, that Section 8.3 addresses only how the shares are voted if the 2015
Voting Trust still exists at the time and does not apply if the Agreement is
terminated. But that is a distinction without a difference. Section 8.3 does not

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require that the Agreement be terminated if the parties cannot agree, and while the
2015 Voting Trust still exists, the trustees are not required to vote the shares in the
same manner.

¶24 Second, Section 12.1 of the 2015 Voting Trust provides the
exclusive terms and conditions for termination of the 2015 Voting Trust. As
pertinent to this appeal, Section 12.1(c) provides that the 2015 Voting Trust will
continue until a majority of the trustees executed a declaration of termination.
Nancy and Tim argue that the circuit court erred by concluding that Section 12.1
contradicts Pat’s representation that they would terminate the 2015 Voting Trust if
they could not agree. Instead, they contend that Section 12.1(c) was included in
the Agreement to incorporate Pat’s representation to that effect. Thus, according
to Nancy and Tim, Section 12.1(c) allowed Pat and Tim to do exactly what Pat
represented that he would do in the event of a disagreement.

¶25 Nancy and Tim’s claim is not supported by the Agreement’s express
language. Although Section 12.1(c) provides a mechanism for the trustees to
terminate the 2015 Voting Trust, the termination procedures contain absolutely no
requirement that the 2015 Voting Trust be terminated if the trustees do not agree.
In fact, Tim’s own testimony confirms that he understood that the 2015 Voting
Trust’s terms allowed Pat and Lori to outvote him on whether to terminate the
Voting Trust and that he knew that Pat was not obligated to vote to terminate the
2015 Voting Trust.

¶26 Nancy and Tim’s argument that “Pat’s promise was incorporated
into the termination clause” in Section 12.1(c) is further contradicted by
Section 8.3, which provides a very different and specific process for voting
disagreements. The record shows that these two provisions were included in the

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draft of the Agreement at the same time and that the terms of both provisions were
emphasized in communications to the parties. Had the parties wanted to agree to a
mandatory or automatic termination provision in the event of a voting
disagreement, they could have written that into the 2015 Voting Trust, but they
failed to do so. See Larchmont Holdings, LLC v. North Shore Servs., LLC, 292
F. Supp. 3d 833, 862 (W.D. Wis. 2017) (stating that it was not reasonable to rely
on representations contrary to contract’s explicit language and that “[t]he only
logical and reasonable response to oral representations that contradicted written
provisions of the contract would have been to insist that the written contract reflect
the oral representation”).

¶27 Third, Nancy and Tim cannot show justifiable reliance because the
2015 Voting Trust contains unambiguous integration and nonreliance clauses.
The integration clause, contained in Article 2 of the Agreement, states that the
2015 Voting Trust “supersedes all prior agreements between the parties relating to
its subject matter.” The nonreliance clause then confirms that “[t]here are no other
understandings or agreements between [the parties] concerning the subject
matter.” As the circuit court recognized, “an unambiguous merger or integration
clause demonstrates that the parties intended the contract to be a final and
complete expression of their agreement.” Town Bank v. City Real Est. Dev.,
LLC, 2010 WI 134, ¶39, 330 Wis. 2d 340, 793 N.W.2d 476.

¶28 By signing the Agreement, Bill and Tim essentially represented as
part of the transaction that they had, in fact, not relied on any prior oral statements
made by Pat. Tim testified that he understood what the unambiguous integration
and nonreliance clauses meant, and Attorney Bradley testified that he did not have
“any evidence to suggest that [Bill] failed to appreciate and understand the

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purpose and effect” of these clauses. Thus, the circuit court properly concluded
that Bill and Tim did not justifiably rely upon Pat’s representation because Pat’s
statement was not incorporated into the final version of the 2015 Voting Trust.

¶29 In response, Nancy and Tim claim that the circuit court erred by
applying the parol evidence rule to conclude that Bill and Tim could not have
reasonably relied on Pat’s misrepresentation. The parol evidence rule provides
that

[w]hen the parties to a contract embody their agreement
in writing and intend the writing to be the final expression
of their agreement, the terms of the writing may not be
varied or contradicted by evidence of any prior written or
oral agreement in the absence of fraud, duress, or mutual
mistake.

Town Bank, 330 Wis. 2d 340, ¶36 (citation omitted); Extra Equip. E Export.
Ltda. v. Case Corp., 541 F.3d 719, 723 (7th Cir. 2008) (“The rule implements the
parties’ intention to ‘simplify the administration of the resulting contract and to
facilitate the resolution of possible disputes by excluding from the scope of their
agreement those matters that were raised and dropped or even agreed upon and
superseded during the negotiations.’” (citation omitted)). According to Nancy and
Tim, “[w]hen determining whether a party committed fraud, the parol evidence
rule does not exclude evidence of a misrepresentation which voids the contract.
Here, because Nancy and Tim seek to void the contract, rather than enforce it, the
parol evidence rule is irrelevant.” See Bank of Sun Prairie v. Esser, 155 Wis. 2d
724, 731, 456 N.W.2d 585 (1990) (“The parol evidence rule does not exclude
evidence to show misrepresentation as a ground for avoidance of the contract.”);
Peterson v. Cornerstone Prop. Dev., LLC, 2006 WI App 132, ¶31, 294 Wis. 2d
800, 720 N.W.2d 716 (“In conjunction with the parol evidence rule, an integration
clause generally bars the introduction of extrinsic evidence to ‘vary or contradict

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the terms of a writing.’ Absent claims of duress, fraud, or mutual mistake,
integration clauses are given effect.” (footnote and citation omitted)); see also
Grube v. Daun, 173 Wis. 2d 30, 59-60, 496 N.W.2d 106 (Ct. App. 1992),
overruled on other grounds by Marks v. Houston Cas. Co., 2016 WI 53, ¶75, 369
Wis. 2d 547, 881 N.W.2d 309 (“Wisconsin follows the general rule that
integration clauses which negate the existence of any representations not
incorporated into the contract may not be used to escape liability for the
misrepresentations.”).

¶30 Pat and Lori argue, however, that the circuit court “did not apply or
address the parol evidence rule in its [o]rder, so the corresponding accusation of
error is unfounded and inappropriate.” To be clear, while the court did not
specifically reference the “parol evidence rule” in its oral ruling or written order, it
did include the Town Bank quote referenced above, defining the rule. Thus, to the
extent the court relied on the parol evidence rule to reach its conclusion, we
conclude that the court properly rejected a claim that Bill and Tim justifiably
relied on Pat’s representation.

¶31 Here, the integration clause in conjunction with the nonreliance
clause clearly express that all prior negotiations between the parties were excluded
and that only the text of the 2015 Voting Trust constituted the final agreement.
Even if the parol evidence rule is not applicable—as Nancy and Tim suggest—
based on their fraudulent misrepresentation claim, the inclusion of the nonreliance
clause in the 2015 Voting Trust forecloses Nancy and Tim’s argument on this
point as it disclaims Bill and Tim’s reasonable reliance on Pat’s representation.
See Peterson, 294 Wis. 2d 800, ¶¶36-37 (concluding, in a case alleging a WIS.
STAT. § 100.18 claim, that “three different provisions [in the contract] expressed

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that all prior negotiations were excluded” and that the “[s]eller has made no
representations other than written in this offer” and therefore the provisions
“disclaim[ed] the purchaser’s right to rely on any alleged fraudulent
misrepresentations”); see also Extra Equip., 541 F.3d at 723-24 (explaining that
“[t]he parol evidence rule is a rule of contract law” and where “the claim of fraud
is based on statements made in a negotiation that resulted in a contract … a suit for
fraud can be a device for trying to get around the limitations that the parol
evidence rule and contract integration clauses place on efforts to vary a written
contract on the basis of oral statements made in the negotiation phase” and
therefore “[n]o-reliance clauses serve a legitimate purpose in closing a loophole in
contract law”). As noted above, the evidence suggests that the parties to the
Agreement understood the significance of the nonreliance clause. See Nightingale
Home Healthcare, Inc. v. Anodyne Therapy, LLC, 589 F.3d 881, 885 (7th Cir.
2009). Therefore, the circuit court did not err.

¶32 Finally, we conclude that the circumstances surrounding the
transaction do not support a claim for justifiable reliance on the alleged
misrepresentation. Nancy and Tim argue that the circuit court erred by “ignoring
the family dynamics and history of unified cooperation between Tim and Pat” and
“Bill’s poor health.” We disagree. The 2015 Voting Trust was the product of a
month-long negotiation, involving five circulated drafts. It is undisputed that in
negotiating the Agreement, the parties were either represented by legal counsel or,
in the case of Pat and Tim, were attorneys themselves. The parties were all
sophisticated individuals, and we are not convinced that a family relationship
between the parties would erase their collective legal knowledge and experience or
business acumen. Further, while it is clear from the record that Bill’s health was

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failing, the record also reveals that Bill was mentally competent when he
negotiated and agreed to the terms of the 2015 Voting Trust.

¶33 Given these circumstances, even if Bill and Tim had initially
believed Pat’s representation that the 2015 Voting Trust would be terminated if
Pat and Tim could not agree, based on the express terms of the Agreement,
coupled with their legal representation and experience, it would have been obvious
to Bill and Tim that the Agreement did not actually require termination under
those circumstances. Thus, any reliance on Pat’s representation was not justifiable
as a matter of law.

b. Nancy Had No Marital Interest in Bill’s Stock

¶34 Nancy and Tim next argue that the “2015 Voting Trust is also void
for the lack of Nancy’s consent to the Agreement and transfer of shares to the
Trust as she held an undivided one-half interest in Bill’s Class A shares of Mason
stock.” Therefore, they claim, “[b]ecause the Trustees knew Nancy held a marital
property interest in Bill’s Class A shares, the trust cannot obtain them free from
Nancy’s interest.” According to Nancy and Tim, the circuit court erred by
concluding that Nancy had no marital property interest in Bill’s Class A shares.

¶35 In reaching its conclusion that Nancy had no marital property
interest in the Class A shares, the circuit court relied on estate planning documents
prepared by Bill and Nancy with the assistance of counsel. It is undisputed that
Bill’s Class A shares were inherited from his family members. On March 1, 1999,
Bill and Nancy executed the Bill & Nancy Trust, which was restated in its entirety
on February 13, 2015. The Bill & Nancy Trust documents classified Bill’s

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Class A shares as Bill’s individual property. Further, in 2006, Bill and Nancy
executed a Marital Property Agreement (“MPA”). That agreement provided that

[a]ny gift or inheritance received from a third party before
or after this agreement is signed shall be classified as the
individual property of the party receiving it. If a party
mixes marital property together with the property received
by gift or inheritance, any individual property so mixed
shall be reclassified as marital property unless the
component of the mixed property that is individual property
can be traced. The parties recognize that individual gift or
inherited property acquired before or after this agreement is
executed must be segregated and not irretrievably mixed
with marital property if the individual property is to remain
individual property.

In her deposition, Nancy agreed that the MPA established that Bill’s Class A
shares were his individual property, not marital property.

¶36 On appeal, Nancy and Tim do not appear to dispute that the plain
terms of the MPA provide that Bill’s Class A shares were classified as his
individual property. Nancy and Tim argue, however, that the circuit court’s
conclusion “ignores what transpired after Bill and Nancy executed the [MPA],”
which is that Bill and Nancy treated the Class A shares as marital property owned
by each of them. Bill’s donative intent is demonstrated, according to Nancy and
Tim, by Bill and Nancy “each, individually, gift[ing] Class A shares to Tim and
Pat.” Notably, both Bill and Nancy filed United States Gift Tax Return, Form 709
(“Form 709”), each individually gifting the same number of Class A shares to both
Tim and Pat.

¶37 We conclude that the circuit court did not err by determining that
Nancy had no marital property interest in Bill’s Class A shares; therefore, Nancy’s
consent to transfer the stock to the Voting Trust was not required, and the 2015
Voting Trust is not void. Whether Bill’s Class A shares are classified as marital or

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No. 2020AP1937

individual property requires us to apply marital property law to undisputed facts,
which is a question of law that we review de novo. See Bille v. Zuraff, 198
Wis. 2d 867, 874-75, 543 N.W.2d 568 (Ct. App. 1995).

¶38 As noted, it is undisputed that under Bill and Nancy’s 2006 MPA,
the Class A shares were classified as Bill’s individual property. This classification
is supported by WIS. STAT. § 766.31(7)(a), which provides that property received
as a gift or by inheritance is individual property. Nevertheless, as Bill and Nancy
recognized in their MPA, a spouse may voluntarily reclassify his or her individual
property to marital property, including by gift, conveyance, and marital property
agreement. See § 766.31(10). Reclassification of property can also be
accomplished pursuant to the mixed property provisions of WIS. STAT.
§ 766.63(1).

¶39 In this case, there is no evidence that Bill reclassified his Class A
shares by gift, conveyance, or by mixing the shares with marital property. Nancy
and Tim fail to specify under which method they claim that reclassification
occurred. While Nancy and Tim argue that Bill reclassified all of his shares as
marital property by gifting some of them to Pat and Tim with Nancy, we fail to see
how the act of gifting the shares to his sons was either a reclassification by gift, as
the gift was not to Nancy, or was a mixing of the gifted shares with marital
property. Even if, as the circuit court postulated, Bill had “gift[ed] [the shares] to
Nancy to … make them marital property” for tax liability purposes and then gifted
those shares to Tim and Pat from both Bill and Nancy, that exchange did not affect
the other shares of Class A stock that Bill retained. Further, we agree with the
court that Form 709 could not, by itself, transform the remaining Class A shares

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No. 2020AP1937

from individual to marital property, and Bill did not take any additional
independent action to reclassify his stock.

¶40 In reply, Nancy and Tim argue that Bill and Nancy’s MPA “varied
the effects of WIS. STAT. § 766.31(10) with respect to the reclassification of
individual property as marital property” because the MPA “provides that inherited
individual property shall be reclassified as marital property if it is mixed or treated
as marital property.” First, as explained above, the Class A stock that Bill retained
was not “treated as marital property.” Further, to the extent that Nancy and Tim
attempt to argue that the shares were mixed with marital property, they fail to
quote the remaining portion of that sentence in the MPA, which states that “any
individual property so mixed shall be reclassified as marital property unless the
component of the mixed property that is individual property can be traced.”
(Emphasis added.) The individual status of Bill’s Class A shares can easily be
traced, and Nancy and Tim do not argue to the contrary. Therefore, the circuit
court did not err by concluding, as a matter of law, that Nancy had no marital
property interest in Bill’s Class A shares, and the 2015 Voting Trust is not void on
that ground.

c. The 2015 Voting Trust Is Not Void for a Lack of a Proper Purpose

¶41 Nancy and Tim next argue that the 2015 Voting Trust is void for
lack of a proper purpose. According to Nancy and Tim, the 2015 Voting Trust
was established “to accomplish an improper, hidden purpose,” which was to
“secur[e] control [of Mason] for a minority group of shareholders.” Further,
Nancy and Tim argue that any possible legitimate purpose of the 2015 Voting
Trust—“the Trustees voting together and presenting a unified front to the rest of
the family and Company shareholders”—has been frustrated.

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No. 2020AP1937

¶42 We conclude that the circuit court properly determined that the 2015
Voting Trust had a proper purpose. As noted, voting trusts are permitted by
Wisconsin law. See WIS. STAT. § 180.0730(1). Under that statute, the only
provision addressing the purpose of a voting trust states: “The voting trust
agreement may include any provision consistent with the voting trust’s purpose.”
Id. The court found that the 2015 Voting Trust contained a statement of purpose
in Article 1(B): “[T]o secure continuity and stability of the voting of the shares of
stock in the Company contributed by the Shareholders.” See 5 FLETCHER
CYCLOPEDIA OF THE LAW OF CORPORATIONS § 2081 (Sept. 2022) (“The purpose
that determines the validity or invalidity of a voting trust agreement is the purpose
that the instrument itself discloses.”). As the court noted in its decision, testimony
from Attorney Bradley, who drafted the Agreement, and testimony from the
parties revealed that the purpose stated in Article 1(B) represented the
agreed-upon purpose of the 2015 Voting Trust.

¶43 Nancy and Tim argue, however, that “the purpose stated in the trust
instrument itself … is not a purpose in and of itself” and that “any analysis of the
trust’s purpose [must] go beyond the language in the agreement,” “creating a
factual dispute that cannot and should not be resolved at summary judgment.”
Nancy and Tim provide no legal support for their conclusory assertion that the
stated purpose of the 2015 Voting Trust is “not a purpose in and of itself.” In fact,
as the Defendants identify, courts in other jurisdictions have found stability and
continuity of management to be a legitimate purpose of a voting trust. See, e.g.,
FLETCHER, supra, at § 2081 (collecting cases); Woloszyn, supra, at 248 (“Use of
the voting trust to [e]nsure stability and continuity of management, especially
successful management, has been held to be a proper purpose.”).

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No. 2020AP1937

¶44 Nancy and Tim next claim that even if ensuring continuity of
management and stability of voting are valid purposes, the 2015 Voting Trust’s
hidden “true purpose, undisclosed at the time of execution, was for Pat and Lori to
secure control of Mason for themselves and leav[e] Tim (and Nancy) out in the
cold.” We agree with the circuit court’s conclusion that “[t]here is no evidence
whatsoever that the purpose of the 2015 Voting Trust was to defraud or
disenfranchise shareholders” and that Nancy and Tim failed “to establish any legal
or factual support for the idea that the 2015 Voting Trust should be voided on
public policy grounds.”

¶45 According to Nancy and Tim, the Defendants “admitted, on multiple
occasions, the purpose of the 2015 Voting Trust was to (1) prevent Nancy from
voting Mason Class A shares, and (2) prevent Nancy and Tim from voting for
directors who would change Mason’s management team (including [Dan’s]
removal and/or removal of Tim from the Board).” However, it was not hidden or
a secret that the terms of the 2015 Voting Trust prevented Nancy from voting
Bill’s Class A shares in the event of his death, as Nancy testified that this result
had been discussed. Further, it was not hidden or secret that, as the Defendants
put it,

part of the purpose of securing continuity and stability of
the voting of the shares of stock meant endeavoring to
counsel against and prevent Tim or Nancy from taking
actions that would endanger the company and the
shareholders’ best interests, including Tim or Nancy
pursuing so-called “nuclear options” such as immediately
firing [Dan] or replacing the majority or totality of the
Board.

As the record demonstrates, these issues were addressed by Pat, and his concerns
were discussed with Tim and Lori prior to creating the 2015 Voting Trust. And,
finally, as addressed above, it was not hidden or a secret that the plain terms of the

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No. 2020AP1937

Agreement did not require the trustees to agree or vote in the same manner; thus, it
was clear that Tim could be outvoted.

¶46 Finally, Nancy and Tim argue that even if the 2015 Voting Trust had
a legitimate purpose, any purported purpose has now been frustrated. They claim
that “[t]he only possibly legitimate purpose found in the trust instrument” was that
the trustees vote together and provide a unified front, and since the trustees are no
longer voting together, that purpose is now impossible. Nancy and Tim also
observe that if the purpose of the 2015 Voting Trust was to prevent board
members from firing Dan, that purpose can no longer be fulfilled, as Dan has since
retired.

¶47 We agree with the circuit court’s conclusion that Nancy and Tim
failed to present sufficient evidence to raise a genuine issue of material fact as to
whether the purpose of the 2015 Voting Trust has become impossible, been
frustrated, or is no longer operative. As noted previously, the 2015 Voting Trust
was created for continuity and stability, not to ensure that the trustees vote in the
same manner. Further, while replacing Dan was discussed, no evidence has been
presented that preventing Nancy and Tim from firing Dan was an actual purpose
of the 2015 Voting Trust. Thus, there is no support for a conclusion that Dan’s
retirement frustrated that purported purpose. For these reasons, the court did not
err by determining that Nancy and Tim failed to establish that the 2015 Voting
Trust had an improper purpose.

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No. 2020AP1937

d. Pat and Lori Did Not Breach Their Fiduciary Duties

¶48 Nancy and Tim next argue that the circuit court erred by concluding
that Pat and Lori did not breach their fiduciary duties as trustees.8 Nancy and Tim
claim that, in general, trustees owe fiduciary duties to their principal, including the
duties of care and loyalty. See Zastrow v. Journal Commc’ns, Inc., 2006 WI 72,
¶¶28-29, 291 Wis. 2d 426, 718 N.W.2d 51; FLETCHER, supra, at § 2091.10
(“Voting trustees should be held to adhere to the usual fiduciary principles of a
trust.”).9 Whether there has been a breach of a fiduciary duty is a question of law
that we review independently. See Jorgensen v. Water Works, Inc., 2001 WI App
135, ¶8, 246 Wis. 2d 614, 630 N.W.2d 230.

¶49 “A corporate officer or director is under a fiduciary duty to act in
good faith and to deal fairly in the conduct of all corporate business,” which
extends “to the corporation, itself, and to its shareholders.” Reget v. Paige, 2001
WI App 73, ¶12, 242 Wis. 2d 278, 626 N.W.2d 302. Relying on our supreme
court’s discussion in Rose v. Schantz, 56 Wis. 2d 222, 228-29, 201 N.W.2d 593
(1972) (a claim based on alleged wrongs committed against a corporation by its
directors and officers belongs to the corporation itself, not the individual
shareholders), the circuit court concluded that Nancy and Tim’s allegations that
the Defendants “breached fiduciary duties as Directors and Officers of [Mason]

8
Although Nancy and Tim’s petition originally alleged a claim for breach of a fiduciary
duty against Dan as well, Nancy and Tim do not appear to contest the circuit court’s grant of
summary judgment on this claim as it pertains to Dan.
9
Pat and Lori argue, in contrast, that the Wisconsin Trust Code does not apply to “voting
trust[s].” See WIS. STAT. § 701.0102(8). Nancy and Tim respond that § 701.0102(8) is
“irrelevant” because their arguments do not rely on WIS. STAT. ch. 701 and are instead “grounded
in the common law of trusts.”

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No. 2020AP1937

are claims that would belong to [Mason], and are not individual claims of either
Nancy and/or Tim that either Nancy and/or Tim have standing or authority to
assert on [Mason’s] behalf.” The majority of the allegations in Nancy and Tim’s
petition regarding breach of a fiduciary duty appear to be claims pertaining to
Mason’s management. See Reget, 242 Wis. 2d 278, ¶¶12-13; Jorgensen, 218
Wis. 2d at 776-77. To the extent that Nancy and Tim state a claim on Mason’s
behalf, we agree with the court that the claim would belong to Mason; therefore,
the court correctly concluded that this claim was a derivative shareholders’ claim,
and Nancy and Tim had no standing to bring it.

¶50 On appeal, Nancy and Tim claim that Pat and Lori, in their roles as
trustees under the 2015 Voting Trust, breached their fiduciary duties to Nancy and
Tim individually. According to Nancy and Tim, Pat’s and Lori’s conduct
contravened their duties as fiduciaries because they acted in their own self-interest
by using trust property for their own purposes. In particular, Nancy and Tim
allege that Pat and Lori “schem[ed] to deprive Nancy and Tim of the voting rights
on their Class A shares for their own personal benefit,” and, further,

[t]heir misappropriation of Nancy’s marital property,
misrepresentations made to Bill and Tim (and Nancy),
wrongful termination of Tim and his subsequent removal
from the Mason board, and other actions designed to secure
control of Mason for themselves, were done in their own
self-interest and are certainly not in the interest of Tim and
Nancy.

¶51 To the extent that any of Nancy and Tim’s claims are not derivative
shareholders’ claims, we conclude that the circuit court did not err by determining
the undisputed facts show that Pat and Lori did not breach any fiduciary duties

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No. 2020AP1937

owed to Nancy or Tim in their roles as trustees.10 In order to bring individual
claims for breach of fiduciary duty, Nancy and Tim’s petition needed to “allege
facts sufficient, if proved, to show an injury that is personal to [them],” as well as
“show that each defendant had a fiduciary duty to [Nancy and Tim] in respect to
corporate affairs and that the conduct alleged in [Nancy and Tim’s petition], as to
each defendant, constitutes a breach of that duty.” See Reget, 242 Wis. 2d 278,
¶12; see also Rose, 56 Wis. 2d at 228.

¶52 The circuit court properly concluded that “[t]he only fiduciary duties
that the Trustees of the 2015 Voting Trust have are those set forth in [S]ection 8.2
of the 2015 Voting Trust itself,” which unambiguously established that the trustees
would not be personally liable under the Agreement. Section 8.2 of the 2015
Voting Trust states:

In voting the shares of stock registered in their names under
this Agreement, the Trustees, either in person or by their
nominees or proxies, shall exercise their best judgment to
select suitable directors of the Company, and shall
otherwise, insofar as they may as Shareholders of the
Company, take such part or action in respect to the
management of its affairs as they may deem necessary so as
to be kept advised on the affairs of the Company and its
management. In voting upon any matter that may come
before them at any Shareholders’ meeting, the Trustees
shall exercise like judgment. The Trustees, however, shall
not be personally liable for any action taken pursuant to
their vote or any act committed or omitted to be done under
this Agreement, provided that such commission or
omission does not amount to willful misconduct on their
part and that they at all times exercise good faith in such
matters.

10
We will assume, without deciding, that Nancy had standing to bring this breach of
fiduciary duty claim, even though she was not a party or signatory to the 2015 Voting Trust and
had no marital property interest in Bill’s Class A stock.

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No. 2020AP1937

¶53 The undisputed facts demonstrate that Pat and Lori did not take any
action that would violate the 2015 Voting Trust. As previously addressed, Nancy
was not deprived of her voting rights in Bill’s Class A shares because she had no
such voting rights pursuant to the terms of the Agreement. Tim was also not
deprived of his voting rights given that Pat and Lori complied with the terms and
provisions for voting pursuant to Section 8.3 of the Agreement. Further, pursuant
to the terms of the 2015 Voting Trust, Pat and Lori were authorized and
empowered to vote to remove members of the board, if that was an action they
deemed appropriate. As Attorney Bradley testified, there was nothing improper or
illegal under the terms of the 2015 Voting Trust about Pat and Lori voting to
remove Tim from the board.

¶54 Finally, as to Pat’s alleged representation during the 2015 Voting
Trust negotiations—i.e., that Pat and Tim would terminate the Agreement in the
event of a dispute—we conclude that even assuming Pat made this statement, he
did not breach a fiduciary duty to Tim and Nancy by doing so. As an initial
matter, we question whether Nancy and Tim have a claim for breach of a duty of
loyalty occurring during those negotiations, as any duty of loyalty was owed to
them per the Agreement, and Pat’s alleged representation occurred prior to its
signing. To the extent that Pat and Lori may have owed a fiduciary duty to Bill,
Nancy, and Tim separate from the 2015 Voting Trust, as we concluded above,
Bill, Nancy, and Tim could not have reasonably relied on Pat’s alleged
representation given the terms of the 2015 Voting Trust and the circumstances of
the negotiations. In summary, Nancy and Tim have failed to offer any evidence
showing the existence of a genuine issue of material fact on their breach of a
fiduciary duty claim. Accordingly, the circuit court properly granted summary
judgment on this issue.

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No. 2020AP1937

e. This Court Lacks Appellate Jurisdiction to Consider Whether the
Circuit Court Erred by Awarding as Costs to Pat and Lori
Disbursements for Legal Fees and Expenses for Preparing for and
Attending Depositions and for Document Production

¶55 Finally, Nancy and Tim argue on appeal that the circuit court erred
by awarding costs not authorized by law.11 Although none of the parties
challenged our appellate jurisdiction as to this issue, we entered an order on
November 30, 2022, questioning whether we possessed jurisdiction to address a
challenge to the award of costs and disbursements and requesting supplemental
letter briefs on the issue. See McConley v. T.C. Visions, Inc., 2016 WI App 74,
¶4, 371 Wis. 2d 658, 885 N.W.2d 816 (“It is the duty of this court,
notwithstanding the fact that no party has raised the issue, to take notice of its
jurisdiction and dismiss an appeal if taken from a nonappealable order.”).

¶56 Nancy and Tim do not challenge whether respondents should be
awarded costs, which the circuit court granted in its October 2, 2020 order, except
to argue generally that summary judgment was improperly granted in the
Defendants’ favor and that a contrary finding would render them no longer the
prevailing party and thus not entitled to costs. As we explained above, however,
the court properly granted summary judgment. Instead, Nancy and Tim object to

11
As the circuit court granted summary judgment to the Defendants, our statutes
mandate an award of their costs. See WIS. STAT. § 814.03(1); Taylor v. St. Croix Chippewa
Indians, 229 Wis. 2d 688, 696, 599 N.W.2d 924 (Ct. App. 1999). The authority of the court to
award costs to the prevailing party is governed by WIS. STAT. § 814.04. The award of costs may
include attorney fees, certain specified costs, and “[a]ll the necessary disbursements and fees
allowed by law.” Sec. 814.04(1), (2).

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No. 2020AP1937

the court’s allowance of certain costs under WIS. STAT. § 814.04(2),12 which were
awarded in the court’s April 1, 2021 order. Thus, Nancy and Tim seek our review
of the court’s April 1, 2021 order, which did not exist when they filed their notice
of appeal on November 16, 2020. Nancy and Tim did not file a separate notice of
appeal from the April 1, 2021 final order.

¶57 Based on our review of the parties’ letter briefs and the record on
appeal, we conclude that we do not have jurisdiction to consider an appeal from
the April 1, 2021 order. First, all parties correctly agree that the October 2, 2020
order was final for purposes of appeal. See Admiral Ins. Co. v. Paper Converting
Mach. Co., 2012 WI 30, ¶33 & n.13, 339 Wis. 2d 291, 811 N.W.2d 351
(“Longstanding Wisconsin law provides that the pendency of a claim for attorney
fees under a fee-shifting statute does not affect the finality of a judgment that
disposes of the matter in litigation.”); Leske v. Leske, 185 Wis. 2d 628, 633, 517
N.W.2d 538 (Ct. App. 1994) (same); see also Harder v. Pfitzinger, 2004 WI 102,
¶17 & n.8, 274 Wis. 2d 324, 682 N.W.2d 398.

¶58 Nancy and Tim argue that they should not have had to bring a
second, separate appeal after the April 1, 2021 order was entered. They claim that
this court

should hold that an appeal from a final appealable order
that includes an award of costs and fees necessarily
incorporates the later-filed order which actually identifies

12
The circuit court awarded costs and disbursements to Pat and Lori in the amount of
$109,837.49. On appeal, Nancy and Tim argue that there is no statutory basis for the court’s
allowance of $76,023.45 of those costs, as this amount includes payments for legal services
rendered for nonparties as well as for document collection and production. In addition to the
nonparties’ legal fees, Nancy and Tim also challenge expenses for “attendance fees” paid to the
court reporting service, which were in addition to the transcription charges, and “video services”
for “digitizing and transcript synchronization, video exhibits, and media and cloud services.”

29
No. 2020AP1937

which costs will be granted and the amount of costs and
fees, even if that later-filed order is entered well after the
notice of appeal is filed.

However, Nancy and Tim do not cite any case law in support of this proposition,
arguing only that a contrary finding would result in multiple or piecemeal appeals,
which is discouraged.

¶59 We conclude that relevant authority supports the filing of separate
appeals in this context. See, e.g., McConley, 371 Wis. 2d 658, ¶10; Kenosha Pro.
Firefighters, Local 414 v. City of Kenosha, 2009 WI 52, ¶15, 317 Wis. 2d 628,
766 N.W.2d 577 (“A final judgment or final order pertaining to fees or costs may
be appealed separately from any appeal of the merits of the underlying dispute.”);
Laube v. City of Owen, 209 Wis. 2d 12, 15-16, 561 N.W.2d 785 (Ct. App. 1997);
ACLU v. Thompson, 155 Wis. 2d 442, 448, 455 N.W.2d 268 (Ct. App. 1990),
overruled on other grounds by Edland v. Wisconsin Physicians Serv. Ins. Corp.,
210 Wis. 2d 638, 563 N.W.2d 519 (1997) (multiple appeals may occur whether
attorney fees are awarded before entering judgment or after an appeal).

¶60 In McConley, for example, this court specifically recognized the
possibility of “multiple appeals” and that “[i]n some cases a second appeal will be
taken from a determination of the attorney fee issue.” McConley, 371 Wis. 2d
658, ¶10. We explained that “[c]onsolidation of related appeals is permitted under
WIS. STAT. RULE 809.10(3)” and that “[i]t may also be appropriate to request a
stay of appellate proceedings when an attorney fee claim is being actively litigated
in the circuit court and the appeal has been filed from the final judgment or order
disposing of the litigation.” McConley, 371 Wis. 2d 658, ¶10 n.6. Ultimately, we
concluded that “[a]lthough our preference is to have attorney fee disputes decided
before an appeal is taken from the final order or judgment disposing of the

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No. 2020AP1937

litigation so that all issues are within one appeal, our preference does not dictate
our jurisdiction under WIS. STAT. § 808.03(1).” McConley, 371 Wis. 2d 658, ¶11.

¶61 Accordingly, we refuse Nancy and Tim’s request to conclude that
their appeal from the October 2, 2020 order incorporated the April 1, 2021 order
entered after their notice of appeal was filed. See State v. Jacobus, 167 Wis. 2d
230, 233-34, 481 N.W.2d 642 (Ct. App. 1992) (“[A]n appeal from a judgment
does not embrace an order entered after judgment.”); Schlichting v. Schlichting,
15 Wis. 2d 147, 160, 112 N.W.2d 149 (1961) (concluding a defendant’s appeal
was “only from the judgment” and a notice of appeal “does not bring before [the
court] for review any order entered subsequent to the judgment”). Because Nancy
and Tim never filed a notice of appeal from the circuit court’s April 1, 2021 order,
see WIS. STAT. RULE 809.10(1)(b)2., we lack appellate jurisdiction to consider
their challenge to that order.

II. Dan’s Cross-Appeal

¶62 In his cross-appeal, Dan argues that the circuit court erred by not
allowing his counterclaim for abuse of process to proceed to trial. He asserts that
the record developed below, viewed in a light most favorable to him, supports an
inference that Nancy and Tim possessed an ulterior motive for including him as a
defendant in this lawsuit. Nancy and Tim were aware that Dan was not a party to
the 2015 Voting Trust, and, according to Dan, Nancy and Tim’s only claim against
Dan—the breach of a fiduciary duty claim—involved both improper plaintiffs and
improper defendants. Thus, he contends, the record is clear that the only reason
for Nancy and Tim to bring a frivolous claim against him was for an improper
purpose: harassment, embarrassment, and forcing him out of his position as
company president.

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No. 2020AP1937

¶63 “The tort of abuse of process is a vague, yet simple, concept”: “One
who uses a legal process, whether criminal or civil, against another primarily to
accomplish a purpose for which it is not designed, is subject to liability to the
other for harm caused by the abuse of process.” Schmit v. Klumpyan, 2003 WI
App 107, ¶6, 264 Wis. 2d 414, 663 N.W.2d 331 (citation omitted). There are two
elements to an abuse of process claim. Id., ¶7. The first is a “wilful act in the use
of process not proper in the regular conduct of the proceedings.” Id. (citation
omitted).

This element requires evidence of “some definite act or
threat not authorized by the process, or aimed at an
objective not legitimate in the use of the process … and
there is no liability where the defendant has done nothing
more than carry out the process to its authorized
conclusion, even though with bad intentions.”

Id. (citation omitted).

¶64 The second element is “a subsequent misuse of the process.” Id., ¶8.
“This element requires evidence of ‘coercion to obtain a collateral advantage, not
properly involved in the proceeding itself,’ or of use of the process ‘to effect an
object not within the scope of the process,’ or of any other improper purpose.” Id.
(citation omitted). In other words, the process must be “used to obtain a collateral
advantage,” which is important “because the tort is characterized as an attempt to
use process as a means of extortion.” Id., ¶9. However, “[t]he instigator’s
personal like or dislike of the target of the process is not relevant”; “there is no
action for abuse of process when the process is used for the purpose for which it is
intended, but there is an incidental motive of spite.” Id., ¶11 (citation omitted).

¶65 Tim and Nancy argue that Dan failed to identify any evidence
supporting either of the above elements, and the circuit court properly dismissed

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No. 2020AP1937

Dan’s claim. We agree with the court’s conclusion that Dan provided no evidence
to support his claim that the purpose of Nancy and Tim’s lawsuit was to “induce
[Dan] to do anything collateral to the lawsuit.” While there is no question that
Dan retired from his positions with Mason during the pendency of this suit, we
agree with the court that there is no evidence that the purpose of Nancy and Tim’s
claim against Dan was to induce or extort Dan to take collateral action—i.e., force
him to retire.

¶66 Dan makes two arguments on appeal. First, he argues that his abuse
of process claim should be allowed to continue because Nancy and Tim’s claim
against him was legally baseless from the beginning. This argument is without
merit. First, it is undermined by the circuit court’s denial of Dan’s initial motion
to dismiss Nancy and Tim’s joint amended petition and complaint, which
illustrated that the court did not believe that Nancy and Tim’s claims were
baseless. Second, as noted above, the established law regarding an abuse of
process claim requires more than a party merely being ultimately unsuccessful on
any of their claims: “The existence of an improper purpose alone is not enough,
for this improper purpose must also culminate in an actual misuse of the process to
obtain some ulterior advantage.” See id., ¶7 (citation omitted). No such misuse of
process occurred here as Dan fails to prove any ulterior advantage Tim and Nancy
gained through pursuit of this lawsuit.

¶67 Dan’s second argument is that the record is full of “[d]ocumentary
evidence manifesting … animosity, threats, and plans to harm” him and that
Nancy and Tim both desired that Dan be removed from Mason. The circuit court
agreed, concluding that “the uncontroverted evidence is that there was some
dispute between [Dan] and [Tim,] that their dissatisfaction with each other was

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No. 2020AP1937

mutual, and that [Dan] may have advised or counseled [Pat] and Lori or other
board members that [Tim] should be terminated from his position with the
company.” While we agree with the court that based on this record there was clear
animosity between the parties, as noted above, “personal like or dislike of the
target of the process is not relevant.” See id., ¶11. Dan has not presented
sufficient evidence—relying instead on speculation and conclusory statements—to
suggest that Nancy and Tim did anything other than act consistently with the
prosecution of a civil lawsuit, regardless of the feelings between the parties. See
Thompson v. Beecham, 72 Wis. 2d 356, 364, 241 N.W.2d 163 (1976) (“[P]roof of
the existence of an improper motive does not dispense with the necessity of proof
of some definite act or threat not properly authorized by the process.”).
Consequently, the court properly granted summary judgment to Nancy and Tim on
Dan’s abuse of process claim.

¶68 No costs are awarded to any party.

By the Court.—Order affirmed.

This opinion will not be published. See WIS. STAT.
RULE 809.23(1)(b)5.

34