Estate of Kevin L. Payette v. David E. Marx

2020 WI App 2

COURT OF APPEALS OF WISCONSIN
PUBLISHED OPINION

Case No.: 2018AP627

Complete Title of Case:

ESTATE OF KEVIN L. PAYETTE, BY ITS PERSONAL
REPRESENTATIVE, ASSOCIATED TRUST CO., N.A., ALEXIS W.
PAYETTE AND NATALIE S. PAYETTE, MINORS, BY THEIR GUARDIAN
AND PARENT, HEATHER PAGEL,

PLAINTIFFS-RESPONDENTS,

SECURA INSURANCE, A MUTUAL COMPANY,

INVOLUNTARY-PLAINTIFF,

V.

DAVID E. MARX AND 1ST AUTO CASUALTY INSURANCE COMPANY,

DEFENDANTS-APPELLANTS.

Opinion Filed: December 10, 2019
Submitted on Briefs:
Oral Argument: August 29, 2019

JUDGES: Stark, P.J., Hruz and Seidl, JJ.
Concurred:
Dissented:

Appellant
ATTORNEYS: On behalf of the defendants-appellants, the cause was submitted on the
briefs of Erik L. Fuehrer and Kody Garza of Gabert, Williams, Konz &
Lawrynk, LLP, Appleton.
Respondent
ATTORNEYS: On behalf of the plaintiffs-respondents, the cause was submitted on the
brief of Herbert C. Liebmann IV of Liebmann & Van Straten Legal
Group, LLC, Green Bay.

A nonparty brief was filed by Lynn R. Laufenberg of Gingras, Thomsen
& Wachs, S.C., Waukesha, and Edward E. Robinson of Cannon &
Dunphy, S.C., Brookfield, on behalf of the Wisconsin Association for
Justice

A nonparty brief was filed by Ryan J. Walsh of Eimer Stahl, LLP of
Madison, on behalf of the Wisconsin Insurance Alliance.

2
2020 WI App 2

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.
December 10, 2019
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. 2018AP627 Cir. Ct. No. 2015CV689

STATE OF WISCONSIN IN COURT OF APPEALS

ESTATE OF KEVIN L. PAYETTE, BY ITS PERSONAL
REPRESENTATIVE, ASSOCIATED TRUST CO., N.A., ALEXIS W.
PAYETTE AND NATALIE S. PAYETTE, MINORS, BY THEIR GUARDIAN
AND PARENT, HEATHER PAGEL,

PLAINTIFFS-RESPONDENTS,

SECURA INSURANCE, A MUTUAL COMPANY,

INVOLUNTARY-PLAINTIFF,

V.

DAVID E. MARX AND 1ST AUTO CASUALTY INSURANCE COMPANY,

DEFENDANTS-APPELLANTS.

APPEAL from a judgment of the circuit court for Brown County:
KENDALL M. KELLEY, Judge. Reversed in part and cause remanded.

Before Stark, P.J., Hruz and Seidl, JJ.
No. 2018AP627

¶1 SEIDL, J. In this wrongful death and survival action, David Marx
and his insurer, 1st Auto Casualty Insurance Company (collectively, 1st Auto),
appeal a judgment awarding prejudgment interest at the rate of 12 percent per year
under WIS. STAT. § 628.46 (2015-16)1 to the Estate of Kevin Payette and Payette’s
minor children, Alexis and Natalie Payette.2 Section 628.46(1) requires an insurer
to “promptly pay every insurance claim” within thirty days of an insurer being
provided “written notice of the fact of a covered loss and of the amount of the
loss” unless “the insurer has reasonable proof to establish that the insurer is not
responsible for the payment.” Id.

¶2 In Kontowicz v. American Standard Insurance Co., our supreme
court concluded that WIS. STAT. § 628.46 is applicable in the context of, as here,
third-party liability claims. See Kontowicz v. American Standard Ins. Co., 2006
WI 48, ¶2, 290 Wis. 2d 302, 714 N.W.2d 105, clarified on denial of

1
The circuit court’s award of statutory interest at the rate of 12 percent was in
accordance with the 2015-16 version of WIS. STAT. § 628.46(1), which was in effect when the
jury returned its verdict in this case on October 2, 2017. On April 4, 2018, twenty days before the
court entered judgment on that verdict, our legislature adopted 2017 Wis. Act 235 (Act 235),
which took effect the following day. Act 235 amended the rate of prejudgment interest due under
§ 628.46(1) for an insurer’s overdue payment from 12 to 7.5 percent per year. See Act 235, § 4.

On appeal, neither party addresses this statutory amendment, and they refer solely to the
applicable statutory interest rate as being 12 percent per year. Because of the parties’ reliance on
the former rate—and because we ultimately reverse the court’s award of prejudgment interest for
reasons unrelated to that rate—all references to WIS. STAT. § 628.46 are to the 2015-16 version of
the Wisconsin Statutes. All other references to the Wisconsin Statutes are to the 2017-18 version
unless otherwise noted.
2
In this opinion, the term “the Estate” refers both to the Estate of Kevin Payette itself
and, when in relation to arguments and litigation conducted by all plaintiffs-respondents—who
shared counsel both in the circuit court and on appeal—to all plaintiffs-respondents. In addition,
when referring to Kevin Payette individually we will use his surname. When referring to his
minor children, because they share that surname, we will use their first names.

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No. 2018AP627

reconsideration, 2006 WI 90, ¶3, 293 Wis. 2d 262, 718 N.W.2d 111. However,
the Kontowicz court limited its “holding to only those situations in which three
conditions to trigger the interest are met.” Kontowicz, 290 Wis. 2d 302, ¶2.
Namely, a third-party claimant is entitled to prejudgment interest under § 628.46
where: (1) “there can be no question of liability on the part of the
insured”; (2) “the amount of the damages [is] in a sum certain amount”; and
(3) “the claimant [provides] written notice of both liability and the sum certain
amount owed” to the insurer. Kontowicz, 290 Wis. 2d 302, ¶2.

¶3 On appeal, 1st Auto contends the circuit court erred in concluding
that the Estate satisfied any of those three conditions. In addition, 1st Auto argues
the court erred by concluding that 1st Auto lacked reasonable proof that it would
not be responsible for payment of the Estate’s claims.

¶4 We confine our analysis to Kontowicz’s “sum certain” condition, as
we conclude it is the dispositive issue in this appeal. We determine that this
condition is not satisfied where a third-party claimant relies upon an assertion of
general damages to support a demand that an excess insurer pay a specific amount,
and the insurer reasonably concludes it is not certain the amount demanded is the
amount it may actually owe the claimant. Such was the case here, as 1st Auto
reasonably concluded that it would not ultimately owe the Estate its demanded
sum (1st Auto’s $1,000,000 policy limit). The reasonableness of 1st Auto’s
conclusion was confirmed by—but not dependent upon—the fact that a jury
ultimately determined that 1st Auto actually owed the Estate only $172,806.42.
Accordingly, we reverse the judgment insofar as it awarded WIS. STAT. § 628.46
prejudgment interest on the jury’s damages award.

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No. 2018AP627

BACKGROUND

¶5 On August 24, 2013, at approximately 5:50 p.m., Payette was
bicycling in the westbound lane of County Trunk Highway VV in the Town of
Seymour. At the same time, Marx was driving his vehicle in the eastbound lane of
County Trunk Highway VV, directly behind a vehicle hauling a horse trailer.
Marx then decided to pass the vehicle and horse trailer and, accordingly, moved
his vehicle into the westbound lane. Shortly thereafter, Marx’s vehicle struck
Payette head-on. First responders found Payette deceased on the shoulder of the
roadway, with his left leg severed.

¶6 At the time of the accident, Marx had an automobile insurance
policy with SECURA Insurance, A Mutual Company (Secura), that provided
$500,000 in liability coverage. He also had a personal umbrella insurance policy
through 1st Auto that provided $1,000,000 in additional coverage.

¶7 On August 15, 2014, counsel for the Estate sent a summary letter
and demand package to 1st Auto. In its letter, the Estate informed 1st Auto that it
was making a “formal demand under [WIS. STAT.] § 628.46” for payment of
1st Auto’s “full policy limit [i.e., $1,000,000] immediately.” In support, the
summary letter stated that the Estate’s “damages are conservatively in the
$3,500,000 to $5,000,000 range.”

¶8 In its demand package, the Estate addressed Marx’s liability,
providing several reasons as to why Marx was responsible for the accident. These
reasons included: (1) a Wisconsin Motor Vehicle Accident Report that concluded
Marx caused the accident by an “improper overtaking”; (2) a written statement
that Marx provided to the Outagamie County Sheriff’s Department where he
acknowledged that he “did not see [Payette] until the last moment”; and

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No. 2018AP627

(3) photographs of Marx’s vehicle showing that “he had two large stickers on the
lower left-corner of his driver’s side windshield,” in apparent violation of WIS.
STAT. § 346.88(3)(a).

¶9 The demand package then addressed the Estate’s damages.
Specifically, the package listed damages of: (1) $7,806.42 in “Medical
Specials/Funeral Expenses”; (2) $1,988,779 in “future damages”3; and (3) an
unspecified amount of damages for “Conscious Pain and Suffering.” The Estate’s
explanation of its potential damages for conscious pain and suffering stated:

No one knows how long Mr. Payette survived following
impact by Mr. Marx’s vehicle. However it is important to
note that his most serious injuries were inflicted below his
vital organs, and he likely did not die instantly. The
undisputable truth is that if Mr. Payette lived for even a few
minutes or seconds following impact, those were the
longest, most excruciating, and terrifying minutes or
seconds of his life.

¶10 One week later, counsel for the Estate sent 1st Auto an e-mail
correspondence. In that e-mail, counsel again demanded 1st Auto promptly pay its
full policy limit. 1st Auto did not do so, and the Estate filed its complaint in the
present action on April 30, 2015.4

¶11 On August 1, 2017, 1st Auto made individual settlement offers to
Alexis, Natalie and the Estate, pursuant to WIS. STAT. § 807.01. Those offers

3
The Estate calculated this figure by multiplying Payette’s median income over the three
years prior to his death ($116,987) by seventeen (the number of years until Payette reached the
age of sixty-five).
4
According to the complaint, “[o]n July 1, 2014, Secura tendered its policy limits of
$500,000” to the Estate.

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No. 2018AP627

were explicitly to settle the Estate’s collective claims against 1st Auto, and
therefore were extended independently and in addition to the $500,000 already
paid to the Estate by Secura. The sum of these settlement offers was $525,000—
$10,000 to the Estate and $257,500 each to Alexis and Natalie. The Estate
rejected 1st Auto’s settlement offers.

¶12 The case proceeded to a six-day jury trial in September and October
of 2017. The jury ultimately returned a verdict finding that Marx was negligent in
the use of his motor vehicle at or immediately prior to the accident, and that such
negligence was the sole cause of Payette’s death.5

¶13 The jury then awarded the Estate a total of $672,806.42 in damages.
That total consisted of: (1) $70,000 in lost inheritance and $75,000 in loss of
support to Alexis; (2) $70,000 in lost inheritance and $100,000 in loss of support
to Natalie; (3) $350,000 for the loss of Payette’s society and companionship
jointly to Alexis and Natalie; and (4) $7,806.42 for funeral expenses to the Estate.
Due to the $500,000 previously paid to the Estate by Secura, 1st Auto was left
owing $172,806.42 to the Estate based on the verdict.

¶14 1st Auto subsequently moved the circuit court for an order denying
the Estate prejudgment interest under WIS. STAT. § 628.46. Three days later, the
Estate filed its own motion seeking an order granting prejudgment interest.

¶15 Following briefing, the circuit court issued a written decision and
order granting the Estate’s motion for WIS. STAT. § 628.46 prejudgment interest at

5
The jury also concluded that Payette was negligent at or immediately prior to the
accident, but that such negligence was not a cause of his death.

6
No. 2018AP627

12 percent per year. As pertinent here, the court determined that the second
Kontowicz condition was satisfied primarily due to the fact that the Estate initially
estimated its total damages at $3,500,000 to $5,000,000 and, based upon this
estimate, demanded a specific sum of money—i.e., the 1st Auto policy limit of
$1,000,000.

¶16 In reaching this decision, the circuit court rejected 1st Auto’s
argument that the jury’s award, which rendered 1st Auto liable for a sum
significantly lower than its policy limit, overcame the certainty of the Estate’s
demand. The court explained:

To permit recovery of prejudgment interest only in cases in
which a jury verdict equals or exceeds the amount
demanded by Plaintiffs in their demand letter pursuant to
Wisconsin Statutes section 628.46 would defeat the
purpose of the statute, which is to discourage insurance
companies from creating unnecessary delays in paying
claims owed. An insurance company would have no reason
to accept a settlement demand if it only ran the risk of
having to pay interest if the judgment was for more than the
amount demanded.

Consequently, the court entered a judgment providing that the Estate is “entitled to
pre-judgment interest from [1st Auto] at 12% pursuant to WIS. STAT. § 628.46.”
1st Auto now appeals.6

DISCUSSION

6
Following the initial briefing, this court held oral argument, and, at our invitation,
amicus briefs were later submitted by the Wisconsin Association for Justice and the Wisconsin
Insurance Alliance (WIA).

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No. 2018AP627

¶17 As a preliminary matter, we observe that we have recently applied
differing standards of review to a circuit court’s award of WIS. STAT. § 628.46
prejudgment interest to a third-party claimant. Compare Dilger v. Metropolitan
Prop. & Cas. Ins. Co., 2015 WI App 54, ¶¶10, 12, 364 Wis. 2d 410, 868 N.W.2d
177 (applying a clearly erroneous standard of review) with Casper v. American
Int’l S. Ins. Co., 2017 WI App 36, ¶15, 376 Wis. 2d 381, 897 N.W.2d 429
(applying a de novo standard of review).7 Ultimately, however, we need not
resolve any tension that exists between Dilger and Casper in this appeal.

¶18 This conclusion follows because, for the reasons explained below,
the dispositive issue here is whether the circuit court applied the proper legal
standard to the facts of this case when it decided that the Estate satisfied
Kontowicz’s sum certain condition. Neither party contends that any of the court’s
factual findings were clearly erroneous, and so we accept all of the court’s factual
findings. See Dilger, 364 Wis. 2d 410, ¶12. As “the question of whether the facts
fulfill a particular legal standard is a question of law which we decide
independently and without deference to the trial court,” we therefore apply a
de novo standard of review in determining whether the Estate satisfied
Kontowicz’s sum certain condition. Kersten v. H.C. Prange Co., 186 Wis. 2d 49,
56, 520 N.W.2d 99 (Ct. App. 1994).

7
The Casper court acknowledged that it was applying a different standard of review
than the Dilger court, and it explained that “[u]nlike Dilger, this case involves a grant of
summary judgment, and the parties do not dispute that independent review of the trial court’s
grant of summary judgment and application of the statute to the facts is appropriate here.”
Casper v. American Int’l S. Ins. Co., 2017 WI App 36, ¶20 n.7, 376 Wis. 2d 381, 897 N.W.2d
429; see also Dilger v. Metropolitan Prop. & Cas. Ins. Co., 2015 WI App 54, ¶¶10, 12, 364
Wis. 2d 410, 868 N.W.2d 177.

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No. 2018AP627

¶19 Turning to the merits, 1st Auto contends the circuit court erred in
awarding the Estate prejudgment interest under WIS. STAT. § 628.46(1). That
statute provides, in pertinent part:

Unless otherwise provided by law, an insurer shall
promptly pay every insurance claim. A claim shall be
overdue if not paid within 30 days after the insurer is
furnished written notice of the fact of a covered loss and of
the amount of the loss. If such written notice is not
furnished to the insurer as to the entire claim, any partial
amount supported by written notice is overdue if not paid
within 30 days after such written notice is furnished to the
insurer. Any part or all of the remainder of the claim that is
subsequently supported by written notice is overdue if not
paid within 30 days after written notice is furnished to the
insurer. Any payment shall not be deemed overdue when
the insurer has reasonable proof to establish that the insurer
is not responsible for the payment, notwithstanding that
written notice has been furnished to the insurer.

Id. (emphasis added).

¶20 In order to be entitled to prejudgment interest under WIS. STAT.
§ 628.46, a third-party claimant must satisfy all three Kontowicz conditions set
forth above. See Kontowicz, 290 Wis. 2d 302, ¶2. Here, because we agree with
1st Auto that the Estate’s claim failed to satisfy the second Kontowicz condition,
we focus exclusively on that condition. See Miesen v. DOT, 226 Wis. 2d 298,
309, 594 N.W.2d 821 (Ct. App. 1999) (stating the court of appeals “should decide
cases on the narrowest possible grounds”).

¶21 Again, the second Kontowicz condition requires that to be entitled to
prejudgment interest under WIS. STAT. § 628.46, a third-party claimant’s “amount
of damages must be in a sum certain amount.” Kontowicz, 290 Wis. 2d 302, ¶48.
The parties agree, and we acknowledge, that neither Kontowicz nor its progeny set
forth a specific test to determine exactly what types of damages a third-party
claimant may demand—and with what level of specificity a claimant must demand

9
No. 2018AP627

them—in order to satisfy this condition. In Casper, however, we did hold that a
third-party claimant’s itemization of past and future special damages is sufficient
to satisfy this condition.8 See Casper, 376 Wis. 2d 381, ¶¶24, 28.

¶22 Pursuant to Casper, the parties here do not dispute that certain
damages identified by the Estate in its written notice constituted a “sum certain”
amount of damages. Namely, the parties do not dispute that the $7,806.42 in
funeral expenses and the $350,000 awarded to Alexis and Natalie for the loss of
Payette’s society and companionship are sums certain within the meaning of
Kontowicz.9 However, as an umbrella carrier, it is undisputed that 1st Auto did
not owe any portion of that combined $357,806.42 in damages to the Estate
because Secura’s primary policy provided $500,000 in liability coverage.

¶23 Thus, the parties’ dispute regarding the sum certain condition
centers on the remaining damages that the Estate sought in its August 14, 2014

8
As we explained in Casper, “[s]pecial damages are ‘those representing the victim’s
actual pecuniary losses[,]’ as opposed to general damages, which are those ‘not readily
susceptible to direct proof or easily estimable,’ and include pain and suffering and injury to
reputation.” Casper, 376 Wis. 2d 381, ¶24 n.9 (citation omitted).
9
We note that a loss of society and companionship claim represents the post-death
noneconomic damages portion of a wrongful death claim. See Phelps v. Physicians Ins. Co. of
Wis., 2009 WI 74, ¶27, 319 Wis. 2d 1, 768 N.W.2d 615. In this case, it is undisputed that
pre-death noneconomic damages (such as damages recoverable in a medical malpractice claim)
were not at issue. See id. Consequently, because Wisconsin law allows for a maximum recovery
of “$350,000 per occurrence in the case of a deceased adult, for loss of society and
companionship,” the maximum amount of noneconomic damages available to the Estate in its
wrongful death claim was $350,000. See WIS. STAT. § 895.04(4).

According to the circuit court’s written decision awarding the Estate prejudgment interest
under WIS. STAT. § 628.46, the “parties agreed prior to judgment that … Alexis and Natalie were
jointly entitled” to this full amount. Due to this stipulation—and in the absence of any argument
to the contrary on appeal by 1st Auto—we deem the Estate’s claim for loss of society and
companionship as a sum certain in the amount of $350,000.

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No. 2018AP627

demand package. Those damages fell into two categories. First, Payette’s Estate
sought damages for Payette’s conscious pain and suffering.10 Second, Alexis and
Natalie sought to recover the pecuniary losses they suffered as a result of Payette’s
death.11

¶24 In its brief-in-chief, 1st Auto contends that the “amorphous nature”
of both of these categories of damages renders them incapable of satisfying
Kontowicz’s sum certain condition. 1st Auto reasons that because both types of
damages are general damages, which, again, by definition are “not readily
susceptible to direct proof or easily estimable,” they cannot constitute a sum
certain.12 See Casper, 376 Wis. 2d 381, ¶24 n.9.

¶25 The Estate responds that “[t]o say the demand was not in a sum
certain amount makes no sense. The demand was for $1,000,000. That is a sum
certain amount.” In so arguing, the Estate essentially urges us to accept the circuit
court’s conclusion that because the Estate “demanded a sum certain from
[1st Auto]—the policy limit of $1,000,000—based on Marx’s certain liability; the
second Kontowicz condition has therefore been satisfied.”

10
Damages for a deceased’s conscious pain and suffering are recoverable in a survival
action, which “belongs to the estate.” See Day v. Allstate Indem. Co., 2011 WI 24, ¶¶61-63, 332
Wis. 2d 571, 798 N.W.2d 199.
11
Damages for pecuniary injuries suffered by a deceased’s beneficiaries may be sought
in a wrongful death action. “Importantly, wrongful death beneficiaries seek recovery not for the
injury suffered by the deceased, but rather ‘for the loss sustained to the beneficiaries because of
the death.’” Day, 332 Wis. 2d 571, ¶62 (citation omitted).
12
The Estate does not refute 1st Auto’s contention that both categories of damages
represent general damages. We therefore deem that point conceded for purposes of this appeal.
See Schlieper v. DNR, 188 Wis. 2d 318, 322, 525 N.W.2d 99 (Ct. App. 1994) (unrefuted
arguments may be deemed conceded).

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No. 2018AP627

¶26 We reject the Estate’s interpretation of Kontowicz’s sum certain
condition—and, by extension, the circuit court’s interpretation of that same
condition—because it would render the condition largely meaningless. This
conclusion follows because if a third-party claimant could always satisfy the sum
certain condition by merely demanding the limits of a particular insurance policy,
then every claimant could simply demand an insurer pay its policy limits in every
claim and thus be entitled to prejudgment interest under WIS. STAT. § 628.46 on
any amount ultimately recovered. Stated differently, under the Estate’s
interpretation, the claimant would be deemed to have satisfied the sum certain
condition regardless of whether there was any certainty that such a sum would
ultimately be owed to the claimant by the insurer. Such a result would be absurd
because, in this regard, it would ignore the fact that the Kontowicz decision itself
referred to a “sum certain” being “owed,” not just demanded. See Kontowicz, 290
Wis. 2d 302, ¶2.

¶27 Just as we reject the Estate’s broad interpretation of Kontowicz’s
sum certain condition, so too do we reject 1st Auto’s argument that the
“amorphous nature” of general damages means that such damages can never
satisfy that condition. And indeed, 1st Auto recognizes in its reply brief that such
a rigid rule is not tenable, stating that there are cases where “no reasonable jury
would return a lesser amount” of general damages than the amount covered by a
policy’s limits.

¶28 1st Auto’s concession is well taken. Even though general damages
are, by definition, “not readily susceptible to direct proof or easily estimable,”

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No. 2018AP627

there certainly are cases where a third-party claimant can satisfy the sum certain
condition based upon a claim for such damages.13 Nonetheless, for the following
reasons, we agree with 1st Auto that this is not such a case.

¶29 First, in its demand package, the Estate explicitly acknowledged
when identifying its potential damages for conscious pain and suffering that “no
one” knew “if Mr. Payette lived for even a few minutes or seconds following
impact.” As such, not only was there no certainty as to how much a jury would
award for Payette’s conscious pain and suffering, there was no certainty that a jury
would award any such damages at all because it was admittedly unknown if
Payette survived for any length of time following the collision with Marx’s
vehicle. These uncertainties were borne out by the jury’s verdict, which
determined the Estate was not, in fact, entitled to any damages for Payette’s
conscious pain and suffering.

¶30 Second, as to the “future damages” referenced in the demand
package, the Estate simply calculated Payette’s lost future wages at $1,988,779.
But Payette’s lost future wages could not have represented a sum certain 1st Auto
owed to the Estate itself, as it is well-established that “[a]n estate may not recover
on its own behalf damages for the decedent’s pecuniary loss.” Weiss v. Regent
Props., Ltd., 118 Wis. 2d 225, 235, 346 N.W.2d 766 (1984). Nor could those

13
We need not search far to find support for this statement, as the WIA recognizes in its
amicus brief that there are “cases in which an assertion of general damages would [constitute a]
‘sum certain owed.’” Specifically, the WIA identifies two types of cases where general damages
may satisfy the sum certain condition: “(1) where the insurer concedes liability for the full
[policy] amount or [2] where, as in Kontowicz, there can be no fair debate that the insurer is
responsible for damages at least up to the policy limit.” See Kontowicz v. American Standard
Ins., 2006 WI 48, 290 Wis. 2d 302, 714 N.W.2d 105.

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No. 2018AP627

wages—standing alone—have represented a sum certain that 1st Auto owed to
Alexis and Natalie, as our supreme court has explained that “[w]rongful death
beneficiaries are not automatically entitled to recover for pecuniary loss resulting
from a parent’s wrongful death. It is well established that the survivors must
prove their loss.” Petta v. ABC Ins. Co., 2005 WI 18, ¶20, 278 Wis. 2d 251, 692
N.W.2d 639 (citation omitted).

¶31 To prove such loss in this context—that is, an alleged pecuniary loss
due to a decedent’s loss of earning power—wrongful-death beneficiaries must
show not just the amount of the decedent’s lost earning power, but the benefit they
would have derived from that earning power. Day v. Allstate Indem. Co., 2011
WI 24, ¶62 n.16, 332 Wis. 2d 571, 798 N.W.2d 199. In this case, critically, the
Estate’s demand package failed to make such a showing because it did not even
attempt to establish what benefit Alexis and Natalie expected to derive from
Payette’s lost future earnings. As such, we cannot say that the Estate showed that
1st Auto owed it a sum certain when it sent the demand package, because that
package was silent on the actual (or, for that matter, even the estimated) amount of
Alexis and Natalie’s recoverable pecuniary losses.

¶32 Based on the foregoing, we need not look beyond the Estate’s
demand package itself to conclude that its identified $1,988,779 in “future
damages” did not satisfy Kontowicz’s sum certain owed condition. Nonetheless,
we note that the jury’s verdict irrefutably confirms that it was not certain that
1st Auto owed to the Estate the $1,000,000 sum it demanded in August 2014, as
that verdict established that 1st Auto actually owed the Estate only $172,806.42.

¶33 For all these reasons, we conclude that the general damages sought
by the Estate in its demand package did not constitute a sum certain that 1st Auto

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No. 2018AP627

owed to the Estate within the meaning of Kontowicz. Although the Estate clearly
demanded that 1st Auto pay a sum certain—its $1,000,000 policy limit—that sum
was not reasonably demonstrated to be owed to the Estate by 1st Auto. Rather,
1st Auto reasonably concluded that the total value of the damages it may owe to
the Estate was lower than the policy limits demanded. In other words, 1st Auto
reasonably concluded it was not certain that it would owe the Estate the sum
demanded.

¶34 In reaching our conclusion, we are mindful of the purpose
underlying WIS. STAT. § 628.46—namely, “to discourage insurance companies
from creating unnecessary delays in paying claims owed.” Kontowicz, 290
Wis. 2d 302, ¶47. That purpose would not be furthered, however, by a conclusion
that the Estate satisfied the sum certain condition in this case.

¶35 To explain, there was unquestionably a delay from the time the
Estate first demanded that 1st Auto pay its policy limits, in August 2014, until the
jury returned its verdict in October 2017. But we perceive nothing unreasonable
about that delay because—for the reasons explained above—1st Auto, a
third-party excess liability insurer, could reasonably conclude it was not certain it
would ultimately owe the amount that the Estate demanded prior to trial.
Resolving that uncertainty via litigation was not an unnecessary delay—indeed,
there are unquestionably occasions where a plaintiff’s “amount of damages [are]
not ascertainable or determinable prior to judicial determination” and litigation is
therefore necessary. See Klug & Smith Co. v. Sommer, 83 Wis. 2d 378, 384, 265
N.W.2d 269 (1978). Our conclusion that this case presented one such occasion
when damages were not certain prior to trial is further underscored by the fact that
the amount the jury awarded the Estate was $352,193.58 less than the $525,000
1st Auto offered to settle the Estate’s claims prior to trial.

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No. 2018AP627

¶36 The Estate makes two additional arguments in support of its
argument that it satisfied the sum certain condition. First, it points to our decision
in Fritsche v. Ford Motor Credit Co., 171 Wis. 2d 280, 491 N.W.2d 119 (Ct.
App. 1992). In that case, the insured and his wife made a first-party claim against
their automobile liability insurer. Id. at 287. The insured’s policy “included
uninsured motorist coverage, and showed a liability limit for this coverage of
$25,000.” Id. The parties disagreed as to whether the insured’s damages would
exceed that limit. Id. at 307 n.8. Ultimately, the matter proceeded to trial, where a
jury “found damages of about $120,000.” Id.

¶37 On appeal, the insurer argued that an award of prejudgment interest
under WIS. STAT. § 628.46 was not warranted because the insured’s claim
“involve[d] nebulous damages such as pain and suffering and future loss of
earning capacity, [and therefore] it [was] not possible to value the claim.”
Fritsche, 171 Wis. 2d at 306. We rejected that argument, stating:

It may be that the risk of mis-evaluation outweighs the risk
of paying [§ 628.46] interest. But [the insurer] has had the
use of $25,000 which became owing to the [insured] as a
result of an accident which occurred October 11, 1985.
Presumably, [the insurer] has received a return on that
amount since then. We see nothing illogical in interpreting
a broad statute to require [the insurer] to pay for the use of
$25,000 from the date by which it had received evidence of
the loss equivalent to a proof of loss.

Id. at 307.

¶38 Based upon this language, the Estate argues that “when an insurance
company makes the decision to withhold payment, it exposes itself to liability for
interest under WIS. STAT. § 628.46.” We are not persuaded, as the Estate reads
Fritsche, a first-party insurance case, too broadly. In particular, the Estate

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No. 2018AP627

overlooks the fact that, here, 1st Auto did not misevaluate the Estate’s claims. To
the contrary, 1st Auto correctly forecasted that a jury would not ultimately find it
owed the Estate damages equal to or in excess of its policy limits, especially when
considering the $500,000 previously paid by Secura.

¶39 Second, the Estate argues that because WIS. STAT. § 628.46 refers to
“any partial amount supported by written notice” being eligible for an award of
prejudgment interest, the jury’s award—although far below their demanded sum—
can still constitute a sum certain. We reject this argument for much the same
reasons we rejected the Estate’s primary argument. That is, it would render
Kontowicz’s sum certain condition meaningless because a claimant could always
demand payment of an insurer’s policy limits and then claim that any lesser
amount ultimately awarded was a partial amount supported by written notice.14

¶40 Moreover, the Estate’s argument fails to account for the fact that the
Kontowicz court expressly “limit[ed]” its holding that WIS. STAT. § 628.46 interest
was available to third-party claimants “to only those situations in which” the three
conditions set forth above are met. Kontowicz, 290 Wis. 2d 302, ¶55. In other
words, the “conditions [Kontowicz] impose[d] raised the bar” for third-party
claimants. Casper, 376 Wis. 2d 381, ¶18. As discussed at length, a jury award for
a portion of the sum certain demand for 1st Auto’s policy limits is not a partial
amount “owed” at the time of the demand, nor is it supported by written notice as

14
We note that our analysis in this opinion is consistent with this statutory language in
that we have treated the Estate’s claims for funeral expenses and loss of society and
companionship as partial amounts supported by written notice. The Estate is not entitled to
prejudgment interest under WIS. STAT. § 628.46 on those claims, however, as it makes no
argument that Secura failed to timely pay them.

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No. 2018AP627

is also required by the statute and Kontowicz. See Kontowicz, 290 Wis. 2d 302,
¶55; sec. 628.46. Thus, we conclude that the Estate’s claim failed to clear this
higher bar. Accordingly, we reverse the judgment insofar as it awarded § 628.46
prejudgment interest on the jury’s damages award and affirm the judgment in all
other respects.

By the Court.—Judgment reversed in part and cause remanded.

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