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On April 3, 2018, the Wisconsin Legislature enacted 2017 Wis. Act 235 which substantially changes certain rules governing civil litigation in Wisconsin. Included in this Act are new rules regarding discovery practice and the Rules of Civil Procedure. It is anticipated that these changes will result in uncertainty and increased motion practice as these new rules take effect. It is important that all Wisconsin litigators and insurance carriers become aware of these changes.
Actions for Injury Resulting from Improvements to Real Property.
The Wisconsin Legislature’s 2017 WIS ACT 235 that passed on April 13, 2018 made significant changes to the Statute of Limitations. Most important for the defense is the shortening of Wis. Stat. § 893.89 (1) (3) (b) relative to actions for injuries suffered due to the improvement to real property to seven (7) years. This had previously been ten (10 years). It still runs from substantial completion, but the three (3) year difference is bound to be significant.
Additional changes were made to shorten the limitation from six (6) years to three (3) for all statutory claims, unless otherwise specified, fraud, injury to the character or rights of another person, and certain claims by franchised motor vehicle dealers. While not likely to implicate many insurance defense cases, these changes highlight the importance to regularly familiarize yourself with Statutes of Limitations. For information on the Statute of Limitations For All 50 States, please view Matthiesen, Wickert & Lehrer’s chart on the subject located HERE.
Limits on Electronic Discovery.
Electronic discovery continues to be a developing area particularly given the various data systems that have been used over the years. It can often be difficult to comply with requests in a form that is usable. Many times, parties will demand a format that is searchable and may be proprietary creating additional logistic issues.
The legislature changed the rules not allowing electronically stored information (ESI) to be discoverable absent the showing of substantial need and good cause if:
- It cannot be retrieved without substantial additional programming or transferring it to another form before search or retrieval;
- There is backup data that is substantially duplicative and more accessible data;
- There is legacy data from absolute systems; or
- Data that is not available in the ordinary course to the producing party and is not reasonably accessible because of burden of cost.
Electronic discovery is still going to be widespread and is subject to fluidity. However, this makes it a bit easier when dealing with the complexity of actual retrieval. Although, it poses an equal amount of concern for those seeking electronic discovery.
Proportionality in Discovery.
The federal rules and now Wisconsin use proportionality to decide whether certain discovery can be had. Parties may obtain discovery on non-privileged matters pertaining to a claim or defense and proportional to the needs of the case considering:
- The importance of the issues at stake in the action;
- The amount in controversy;
- The parties’ resources;
- The importance of the discovery being sought in resolving the issues; and
- Whether the burden and expense outweigh the likely benefit.
While this is supposed to allow more meritorious cases to be filed that would otherwise be impractical given the costs of discovery by lowering the cost of discovery, it may also ultimately favor defendants.
Third Party Litigation Funding.
Of some interest, although not necessarily a great impact, is the enactment of a provision mandating disclosure of any agreement under which any entity (other than an attorney on a contingent fee) has a right to receive compensation that is contingent on proceeds of the action. This can be useful especially in cases where providers agree to forego their charges until after a verdict. Normally this is ferreted out in discovery, but now must be disclosed without request. It will also be interesting to see the number of cases involving advance companies as hedge funds have been reported to be investing in lawsuits at a growing rate.
Overdue Payment Interest.
Until now, overdue payments ran with a 12% interest rate, but that has now been reduce to 7.5%.
Wisconsin Act 235 brings substantial changes to Wisconsin civil litigation and the Rules of Civil Procedure. Whether the Act lowers litigation costs remains to be seen. However, there is every expectation that civil litigators, as well as the courts, will face immediate challenges as they attempt to clarify these new rules.
If you should have any questions regarding insurance litigation or coverage, please contact Eric Goelz at [email protected].