Jerod C. Hansen v. Mark A. Klein

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.
July 27, 2021
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. 2020AP1265 Cir. Ct. No. 2017CV189

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT III

JEROD C. HANSEN AND CATHERINE TABOR-HANSEN,

PLAINTIFFS-APPELLANTS,

V.

MARK A. KLEIN, DECEASED, LISA A. KLEIN, WENDELL P. KLEIN,
ANNA M. KLEIN AND CARLTON J. KLEIN,

DEFENDANTS-RESPONDENTS,

ABC INSURANCE COMPANY, DEF INSURANCE COMPANY AND GHI
INSURANCE COMPANY,

DEFENDANTS.

APPEAL from a judgment of the circuit court for Trempealeau
County: RIAN RADTKE, Judge. Affirmed.

Before Stark, P.J., Hruz and Seidl, JJ.
No. 2020AP1265

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. Jerod Hansen and Catherine Tabor-Hansen
(collectively, “the Hansens”) appeal from the circuit court’s grant of a summary
judgment in favor of Wendell, Anna and Carlton Klein (collectively, “the
Kleins”), dismissing the Kleins from this suit. The Hansens argue that disputed
issues of material fact remain as to whether the Kleins engaged in a civil
conspiracy with their neighboring relatives, who sold real property to the Hansens,
to suppress and conceal the existence of adverse conditions affecting the property
during the time that the Hansens rented the property and prior to their purchase of
it. We conclude the Hansens failed to provide sufficient evidence, under the
applicable legal standard, to support their civil conspiracy claim, and, thus, no
genuine issues of material fact preclude summary judgment on that claim.
Accordingly, we affirm.

BACKGROUND

¶2 The Kleins live on a roughly 500-acre farm in Trempealeau County.
The Kleins have worked on the farm their entire lives, growing cash crops to sell
locally. From 1962 to 2017, they have seasonally used propane cannons, referred
to as “scare guns,” to scare away birds and to keep them from destroying their
crops. In 2013, the County enacted an ordinance requiring any person wishing to
operate a scare gun within the County to obtain a permit. The Kleins obtained a
permit for the 2015 season, but they were cited multiple times for ordinance
violations until they stopped using the scare guns sometime in 2017.

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¶3 Mark Klein,1 the brother of Carlton and Wendell, owned real
property near the Kleins’ farm along with his wife, Lisa. Mark and Lisa moved to
Minnesota in 2012. From time to time, even after the move, Mark hunted on the
Kleins’ farm, and Wendell and Carlton rented land from Mark.

¶4 Around June of 2015, the Hansens first rented Mark and Lisa’s
residence, and they then entered into a written agreement to purchase it. Mark and
Lisa provided the Hansens with a real estate condition report specifically
indicating that there were no adverse conditions affecting the property that they
were required to disclose. As relevant here, Mark and Lisa did not disclose the
Kleins’ use of scare guns on the adjacent property.

¶5 The Hansens eventually commenced an action against Mark and
Lisa alleging claims against them for negligent misrepresentation, intentional
deceit, fraudulent advertising, and breach of express warranty, all arising from
their failure to disclose the Kleins’ use of scare guns. In addition, the Hansens
alleged a claim for civil conspiracy against Mark, Lisa, and the Kleins.
Specifically, the Hansens alleged that Mark and Lisa conspired with the Kleins to
suppress and conceal the excessive use of scare guns on the farm during the time
that the Hansens rented the property and prior to their closing on the real estate.2
The Hansens claimed that they were unaware of any defects in the property at the
time of its purchase, that the use of the scare guns constituted a defect in Mark and

1
Mark Klein passed away after the commencement of this action.
2
The Hansens also alleged that the Klein brothers individually, or as part of a
conspiracy, engaged in a pattern of continual threatening and intimidating behavior and/or
deception toward the Hansens so as to dissuade them from enforcing their rights and testifying in
this case. While this allegation is briefly mentioned in the Hansens’ appellate briefs, it does not
appear to be material to the present appeal, and we will not address it further.

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Lisa’s property that Mark and Lisa were required to disclose,3 and that the
Hansens have been damaged by the use of the scare guns.

¶6 The Kleins filed a motion for summary judgment, arguing there was
insufficient evidence to support the Hansens’ claims against them. The Hansens
filed various affidavits in opposition to the Kleins’ motion. These included one
from the Hansens’ current—and Mark and Lisa’s former—neighbor, Robert Bork.
Robert averred, among other things, that: (1) during the time Mark and Lisa’s
property was for sale, the Kleins reduced the firing of the scare guns, including
silencing them when the property was shown to prospective buyers; and (2) his
wife, Pat, had a discussion with an unidentified prospective buyer, as well as with
the realtor, about the buyer’s unawareness of the Kleins’ use of the scare guns.
The Hansens did not submit an affidavit from Pat Bork.

¶7 The circuit court granted the Kleins’ summary judgment motion and
dismissed the claims against them with prejudice, concluding there was
insufficient evidence to support the Hansens’ civil conspiracy claim. The Hansens
now appeal.

DISCUSSION

¶8 We review a summary judgment decision de novo, using the same
methodology as the circuit court. Water Well Sols. Serv. Grp. v. Consolidated
Ins. Co., 2016 WI 54, ¶11, 369 Wis. 2d 607, 881 N.W.2d 285. Summary
judgment is appropriate if there is no genuine issue as to any material fact and the

3
In particular, the Hansens assert that “defects” requiring disclosure include
environmental nuisances affecting the property, which they claim include noise coming from
neighboring properties.

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moving party is entitled to judgment as a matter of law. WIS. STAT. § 802.08(2)
(2019-20).4 For a party against whom a claim has been made to make a prima
facie case for summary judgment, it must show a defense which would defeat the
claim. Preloznik v. City of Madison, 113 Wis. 2d 112, 116, 334 N.W.2d 580
(Ct. App. 1983). If such a showing has been made, we examine the affidavits
submitted by the opposing party to determine whether a genuine issue exists as to
any material fact. Id. In evaluating the evidence, we draw all reasonable
inferences from the evidence in the light most favorable to the nonmoving party.
Burbank Grease Servs., LLC v. Sokolowski, 2006 WI 103, ¶40, 294 Wis. 2d 274,
717 N.W.2d 781.

¶9 The Hansens argue the circuit court erred in granting the Kleins’
summary judgment motion and dismissing them from the lawsuit.5 The Hansens
first claim there are material questions of fact as to whether a conspiracy existed as
alleged, thereby requiring a trial and preventing summary judgment. They further
contend that the court improperly relied upon North Highland, Inc. v. Jefferson
Machine & Tool Inc., 2017 WI 75, 377 Wis. 2d 496, 898 N.W.2d 741, and
Maleki v. Fine-Lando Clinic Chartered, S.C., 162 Wis. 2d 73, 469 N.W.2d 629
(1991), in articulating the Hansens’ burdens of production and persuasion for their
civil conspiracy claim.

4
All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise
noted.
5
The Kleins filed a motion for summary judgment, and the circuit court granted the
motion and ordered dismissal of “all claims against” them with prejudice. Lisa, represented by
separate counsel, still remains in the suit. We note that while Lisa (as well as Mark, now
deceased) is noted in the caption as one of the “defendants-respondents,” she was not a
respondent to this appeal.

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¶10 Addressing the latter issue first, North Highland and Maleki held
that to prevail on a civil conspiracy claim, “a plaintiff ‘must show more than a
mere suspicion or conjecture that there was a conspiracy or that there was
evidence of the elements of a conspiracy.’” North Highland, 377 Wis. 2d 496,
¶23 (quoting Maleki, 162 Wis. 2d at 84). North Highland also held, as a variation
on this notion, that “[i]f circumstantial evidence supports equal inferences of
lawful or unlawful action, then the conspiracy is not proven and the case should
not be submitted to the jury.” Id.

¶11 The Hansens contend that North Highland and Maleki are
inapposite for two reasons. First, they argue that North Highland involved a
claim of a conspiracy to breach a fiduciary duty, unlike the fraud-based claims in
this case. Second, Maleki was decided based upon a review of a jury’s verdict,
not on summary judgment. According to the Hansens, the nature of the alleged
civil conspiracy here and the posture of summary judgment require that they only
show whether competing inferences can be drawn from the facts, and if so, the
case must be submitted to the jury. See Coopman v. State Farm Fire & Cas. Co.,
179 Wis. 2d 548, 559, 508 N.W.2d 610 (Ct. App. 1993).

¶12 We disagree. First, we can easily dispose of the Hansens’ contention
that Maleki is of no import here because it involved postverdict submissions rather
than a motion for summary judgment. The Hansens fail to develop any argument
as to why that distinction matters for purposes of our review, other than to
reference their general argument, which we reject below, that questions of material
fact preclude summary judgment. We will not abandon our neutrality to develop
arguments for a party. See Industrial Risk Insurers v. American Eng’g Testing,
Inc., 2009 WI App 62, ¶25, 318 Wis. 2d 148, 769 N.W.2d 82.

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¶13 Second, North Highland, which involved a review of a grant of
summary judgment, provides that to submit a conspiracy claim to trial, there “must
be [both] a quantum of evidence that the trial judge can conclude leads to a
reasonable inference of conspiracy” and “specific evidentiary facts that are
admissible in evidence.” North Highland, 377 Wis. 2d 496, ¶¶23, 26 (citations
omitted). Nothing in that case suggests the court’s holding was limited by the
nature of the underlying claim—i.e., the breach of a fiduciary duty. Rather, the
holding in North Highland creates a heighted burden for all conspiracies.

¶14 The Hansens reach their contrary conclusion by misreading a single
sentence in North Highland which states: “[A] claim for conspiracy to breach a
fiduciary duty requires a more stringent test than whether a reasonable inference
may be drawn from the facts.” Id., ¶23 (citation omitted). Based on that sentence,
they summarily contend that the “more stringent test” to which the court referred
was derived not from the fact that the claim in North Highland involved a
conspiracy, but rather from the fact that the claim specifically involved a
conspiracy to breach a fiduciary duty. But the Hansens are clearly wrong in this
regard because the North Highland court cited Maleki immediately after this
sentence in support of the stated proposition, and Maleki itself did not involve a
breach of fiduciary duty but, rather, a civil conspiracy claim of unlawfully injuring
a business contrary to WIS. STAT. § 134.01. See Maleki, 162 Wis. 2d at 77.
Indeed, the Maleki court stated, including language cited by North Highland:

While inferences reasonably drawn are appropriate bases
for unassailable findings of fact in most cases, and the
acceptance of one inference rather than another by the jury
is generally a sufficient finding of fact (see St. Paul Fire &
Marine Ins. Co. v. Burchard, 25 Wis. 2d 288, 130 N.W.2d
866 (1964), and Currie & Heffernan, Wisconsin Appellate
Practice and Procedure, pp. 36-7, 1975 Wis. Bar ATS),
Wisconsin law in respect to conspiracies imposes a more
stringent test. To prove a conspiracy, a plaintiff must show

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more than a mere suspicion or conjecture that there was a
conspiracy or that there was evidence of the elements of a
conspiracy. The United States Court of Appeals for the
Seventh Circuit, relying on Wisconsin cases, recently
stated:

In Wisconsin, if circumstantial evidence supports equal
inferences of lawful action and unlawful action, then the
claim of conspiracy [under sec. 134.01, Stats.] is not
proven. See Scheit v. Duffy, 248 Wis. 174, 176, 21
N.W.2d 257 (1946).

Maleki, 162 Wis. 2d at 84-85 (quoting Allen & O’Hara, Inc. v. Barrett Wrecking,
Inc., 898 F.2d 512, 516 (7th Cir. 1990); alteration in Maleki). Nowhere else in
their briefs do the Hansens attempt to explain why we should apply the rule
articulated in North Highland only to conspiracy claims involving breaches of
fiduciary duties, and not , as here, to claims sounding in fraud.

¶15 Thus, the circuit court properly concluded that absent something
more than circumstantial evidence supporting equal inferences as to whether the
elements of a civil conspiracy claim were met, the Hansens’ conspiracy claim
failed as a matter of law.

¶16 With the relevant legal standard confirmed, we turn to the evidence
in the summary judgment record, viewing it, as we must, in the light most
favorable to the Hansens, the nonmoving parties. The Hansens principally argue
that the circuit court erred in finding that the majority of the facts they provided in
their affidavits in opposition to the summary judgment motion were inadmissible
hearsay, lacking in foundation, speculative, and otherwise insufficient to show that
a civil conspiracy existed. Again, we disagree.

¶17 A civil conspiracy claim has three elements: (1) the existence and
operation of a conspiracy; (2) wrongful acts done pursuant to the conspiracy; and
(3) damage resulting from those acts. North Highland, 377 Wis. 2d 496, ¶25. To

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prove a conspiracy, the Kleins must have had some awareness that Mark and Lisa
were breaching their duty to disclose the scare guns as a nuisance, and, further,
they must have agreed to help Mark or Lisa conceal that information. None of the
evidence the Hansens rely upon, however, is anything more than circumstantial
and speculative evidence that a conspiracy existed.

¶18 Here, the Hansens assert that because Mark was a relative, worked
with the Kleins in the past, and he was allegedly seen working on the Kleins’
property after the sale and hunting on Kleins’ land, there must have been
communication regarding Mark and Lisa’s allegedly fraudulent schemes. A
similar, entirely speculative argument was raised and rejected in North Highland.
In that case, Trewyn, a current employee of North Highland, formed a
manufacturing company named Jefferson Machine with a man named Wells.
North Highland, 377 Wis. 2d 496, ¶¶6-7. The underlying dispute arose when
both North Highland and Jefferson Machine submitted confidential bids on a
project. Id., ¶8. North Highland alleged that while Trewyn was employed at
North Highland, he formulated confidential bids for both North Highland and
Jefferson Machine. Id. North Highland suggested that because Trewyn and Wells
had a working relationship at Jefferson Machine, they must have discussed the
bidding formulations and conspired together to breach a fiduciary duty to the
claimant. Id., ¶¶29-32. Our supreme court disagreed, concluding that although an
inference may be drawn that Trewyn shared knowledge with Wells, unrebutted
deposition testimony supported the opposite conclusion. Id., ¶30. There was no
direct evidence to support the formation and operation of a conspiracy. Id.

¶19 We, like the circuit court, easily reject the theory that merely
because most of the alleged co-conspirators were brothers and Mark occasionally
worked on the farm and hunted on the Kleins’ land, a conspiracy existed. Even

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assuming all of the Hansens’ alleged facts are true, their claim still fails because
those facts are insufficient to create a genuine issue of material fact on summary
judgment under the applicable North Highland standard. Likewise, questions of
fact regarding the nature of the family members’ relationships during the relevant
times are not material, even if those facts were construed in favor of the Hansens.6

¶20 The remainder of the evidence offered—i.e., the vague statements in
the Hansens’ opposition affidavits that the scare guns did not appear to operate as
much, or at all, when the property was being shown—were properly disregarded
by the circuit court as too vague and speculative. Likewise, the fact that Mark was
angry over a neighbor, Pat Bork, contacting the realtor after allegedly hearing that
an unknown prospective buyer had not been told about the scare guns when
viewing the property was itself based upon inadmissible hearsay, given that the
record is devoid of any sworn statements by Pat or, especially, the unknown
prospective buyer. In any event, even if the Borks’ statements in reference to the
purported unknown buyer were admissible, they do not reasonably show, beyond a
mere inference, that there was a conspiracy between Mark and Lisa and any of the
Kleins in relation to usage of the scare guns during the property’s pending sale to
the Hansens.

¶21 The Hansens also reference a letter sent by Carlton to Pat Bork as
supportive evidence. They contend that because the letter mentions the phone call

6
In their reply, the Hansens take issue with the Kleins’ allegation that they were
estranged from Mark and Lisa, and they cite facts to show otherwise. As discussed above,
however, even if Mark and Lisa were not estranged from the Kleins and communicated with them
at times, their family relationship and occasional communication, harvesting and hunting on the
Kleins’ property are insufficient evidence to permit a fact finder to conclude, under the standard
in North Highland v. Jefferson Machine & Tool Inc., 2017 WI 75, 377 Wis. 2d 496, 898
N.W.2d 741, that a civil conspiracy existed so as to preclude summary judgment.

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from Pat to the realtor, Mark and Lisa must have spoken to Carlton about the call,
and the letter was an effort to persuade Pat to stop speaking to the Kleins’ realtor.
The letter, as the circuit court noted, appears to call Pat a liar, with the rest of its
contents again appearing vague and irrelevant. This letter does not rise to the
North Highland standard necessary to show a civil conspiracy. See North
Highland, 377 Wis. 2d 496, ¶¶23, 26. In particular, it does not constitute direct
evidence of either the Kleins’ awareness that Mark and Lisa were breaching their
duty to disclose the scare guns as a nuisance, or of their agreeing to help Mark or
Lisa conceal that information. Additionally, it may have also been reasonable to
infer that Carlton heard of this conversation from some other party.

¶22 Finally, the Hansens offered the affidavit of Catherine Tabor-Hansen
as evidence of acts done in furtherance of the alleged conspiracy. Suffice it to say,
that affidavit was also based wholly upon unsupported speculation in terms of
facts necessary to meet the elements of a civil conspiracy.

¶23 We agree with the circuit court that there is no admissible evidence
in the record directly supporting the existence or operation of a conspiracy, nor
was there any evidence of actions taken pursuant to the conspiracy. 7 By way of
comparison, in the affidavits of Wendell, Anna, and Carlton Klein in support of
their summary judgment motion, each stated under oath that: (1) they did not
communicate with Mark and Lisa about the sale of their property, and they first

7
In their briefs, the Hansens reference not having the ability to conduct depositions
before the Kleins filed their summary judgment motion due to the COVID-19 pandemic. The
Hansens, however, did not seek leave of the circuit court before choosing to respond to the
summary judgment motion solely upon affidavits. See WIS. STAT. § 802.08(4) (a court may
refuse a motion for judgment or may order a continuance to permit affidavits to be obtained or
depositions to be taken). Thus, they cannot now claim that the court erred by failing to allow
them to conduct additional discovery.

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learned of it when they saw the for sale sign in Mark and Lisa’s yard; (2) they did
not know when the house was being viewed; (3) they never discussed with Mark
or Lisa the non-use of scare guns during any viewings; and (4) they did not know
when the house was rented or sold.

¶24 In sum, the vague and speculative affidavits filed in opposition to the
Kleins’ motion for summary judgment did not raise genuine issues of material fact
on the elements of civil conspiracy sufficient to defeat the Kleins’ prima facie
showing. Again, the applicable, heightened legal standard for a conspiracy
claimant’s burden of production and persuasion is dispositive here.8 As discussed
above, the Hansens “must show more than a mere suspicion or conjecture that
there was a conspiracy or that there was evidence of the elements of a conspiracy.”
North Highland, 377 Wis. 2d 496, ¶23 (quoting Maleki, 162 Wis. 2d at 84). At
best, there are equal inferences supporting the existence and nonexistence of a
conspiracy, and under North Highland, we must therefore conclude that the
Hansens’ proof was insufficient to raise material questions of fact warranting trial.
Accordingly, the circuit court properly granted summary judgment.

By the Court.—Judgment affirmed.

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

8
Indeed, it appears the Hansens appreciate the difficulty of their argument under the
more stringent standard, as they ignore North Highland and Maleki v. Fine-Lando Clinic
Chartered, S.C., 162 Wis. 2d 73, 469 N.W.2d 629 (1991), entirely in their reply brief, and instead
suggest that to withstand summary judgment, it was sufficient for them to show the existence of
competing inferences as to whether the elements of a conspiracy claim were met.

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