Attorney Fees, Costs, and Other Expenses – Obtaining Sanctions and Recovering Attorneys’ Fees in Civil and Family Law Cases in Wisconsin

(c) The allegations and other factual contentions stated in the paper have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery;

(d) The denials of factual contentions stated in the paper are warranted on the evidence or, if specifically so identified, are reasonably based on a lack of information or belief.

Wis. Stat. § 802.05(2)(a)-(d). If a party believes that one or more of the foregoing representations has been violated, it may file a Motion for Sanctions with the Court. The procedure for filing such a motion is outlined in s. 802.05(3):

• The Motion for Sanctions must be made separately from other motions or requests, and it must describe the specific conduct which it believes constitutes a violation of the sub. (2) (the representations outlined earlier);
  
• The Motion must be served as provided in s. 801.14, but should not be filed or presented to the Court unless:
  
  • Within 21 days after service of the motion (or other period as the court may prescribe), the paper, claim, defense, contention, allegation or denial is not withdrawn or corrected.

Id. § 802.05(3)(a)1. This procedure does not apply to disclosures, discovery requests, responses, objections, and motions that are subject to ss. 804.01 to 804.12. Id. § 802.05(5). The Court, on its own initiative, can also issue an order describing the specific conduct that appears to violate the representations outlined earlier and directing the attorney, law firm or party to show cause why it has not violated sub. (2) with the specific conduct the court described in its order. Id. § 802.05(3)(a)2.

The award of sanctions under this statute, even where the court finds a violation, is discretionary. If the Court finds that sub. (2) has been violated, it may impose sanctions upon the parties, attorneys, or law firms who are responsible for the violation. Sanctions imposed for violation of this rule must be limited to “what is sufficient to deter repetition of such conduct or comparable conduct by others situated.” Wis. Stat. § 802.05(3)(b). The sanctions awarded may be a directive of a nonmonetary nature, an order to pay a penalty into court, or, if imposed on  motion, and warranted for effective deterrence, an order paying the moving party some or all of the attorney fees or other expenses incurred as a direct result of the violation. Id. § 802.05(3)(b).

The Court must describe the conduct that it determined violated this rule and explain the basis for the sanction imposed at the time that it imposes sanctions. Id. § 802.05(3)(c). There are limitations on the sanctions that may be awarded. Monetary sanctions cannot be awarded against a represented party for violation of sub. (2)(b). Monetary sanctions also cannot be awarded on the court’s initiative unless the court issues its order to show cause before voluntary dismissal or settlement of the claims made by or against the party that is, or whose attorneys are, to be sanctioned. Id. § 802.05(3)(b)2.

Wis. Stat. § 895.044: Damages for Maintaining Certain Claims and Counterclaims

Wis. Stat. § 895.044 is narrower in scope than Wis. Stat. § 802.05 in terms of the conduct which constitutes a violation of the section. Under Wis. Stat. § 895.044, a party or party’s attorney may be liable for costs and fees under the section for commencing, using, or continuing an action, special proceeding, counterclaim, defense, cross complaint, or appeal which:

(a) was commenced, used, or continued in bad faith, solely for the purposes of harassing or maliciously injuring another;

(b) The party or the party’s attorney knew, or should have known, that the action, special proceeding, counterclaim, defense, cross complaint, or appeal was without any reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification, or reversal of existing law.

Wis. Stat. § 895.044(1)(a)-(b). A Motion under this section has a similar, but distinct, procedure as that for sanctions under s. 802.05:

• The Motion may be made at any time during the proceeding or upon judgment, and a copy of that motion and a notice of the date of the hearing on the motion must be served on any party who is not represented by counsel only by personal service or by sending the motion to the party by registered mail.
• If a Court finds by clear and convincing evidence that sub. (1) (a) or (b) applies to an action, or special proceeding commenced or continued by a plaintiff or a counterclaim, defense, or cross complaint commenced, used, or continued by a defendant:
  • The Court may – if the party served with the motion withdraws, or appropriately corrects, the action, special proceeding, counterclaim, defense, or cross complaint within 21 days after service of the motion (or within such other period as the court may prescribe), award to the party making the motion, as damages, the actual costs incurred by the party as a result of the action, special proceeding, counterclaim, defense, or cross complaint, including the actual reasonable attorney fees the party incurred, including fees incurred in any dispute over the application of this section.
    • In determining whether to award, and the appropriate amount of, damages under this paragraph, the court shall take into consideration the timely withdrawal or correction made by the party served with the motion.
  • The Court shall – if a withdrawal or correction is not timely made, award to the party making the motion, as damages, the actual costs incurred by the party as a result of the action, special proceeding, counterclaim, defense, or cross complaint, including the actual reasonable attorney fees the party incurred, including fees incurred in any dispute over the application of this section.

The costs and fees awarded may be assessed fully against the party bringing the action, special proceeding, cross complaint, defense, counterclaim, or appeal or the attorney representing the party, or both, jointly and severally, or may be assessed so that the party and the attorney each pay a portion of the costs and fees. This section can also apply to appeals, including appeals related to an award made under this section. See id. § 895.044(4) & (5).

Discovery Violations: Wis. Stat. § 804.12

Wis. Stats. §§ 804.08 & 804.09 commands the party answering discovery requests to serve a copy of answers to interrogatories and responses to requests for production of documents within 30 days after service. Wis. Stats. §§ 804.08(1)(b) & 804.09(2)(b)1. If a responding party fails to do so, the requesting party may move the Court pursuant to Wis. Stat. § 804.12 for an order compelling discovery. If the Motion to Compel is granted, Wis. Stat. § 804.12(1)(c) instructs that the Court shall award reasonable expenses incurred in obtaining the order, including attorney fees. The only bases under which the Court can decide not to award reasonable fees is if the Court finds that the opposition to the motion was substantially justified, or that other circumstances make an award of expenses unjust. Wis. Stat. § 804.12(1)(c)1. If the motion is denied, the Court can order the moving party, the attorney advising them, or both, to pay the reasonable expenses incurred by the party opposing the motion, unless the court finds that the making of the motion was substantially justified or that other circumstances make an award of expenses unjust. Id. § 804.12(1)(c)2.

Parties can also obtain an award of the reasonable expenses, including attorney fees, incurred in connection with proving the genuineness or truth of a party that a party’s failed to admit in response to requests for admissions. Wis. Stat. § 804.12(3). Where are party has successfully proved a matter that the responding party failed to admit in response to requests for admissions, the court shall order the other party to pay the requesting party their reasonable expenses, including attorney fees, unless it finds that the request was objectionable under s. 804.12(1), the admission was of no substantial importance, or the party failing to admit had reasonable grounds to believe that he or she might prevail on the matter, or there was other good reason for the failure to admit. Wis. Stat. § 804.12(3).

Family Law Cases: Wis. Stat. § 767.241

In family law cases, a party may make a request pursuant to Wis. Stat. §767.241 for an order requiring the other party to pay a reasonable amount for the cost of maintaining or responding to an action and for attorney fees. Wis. Stat. § 767.241(1)(a). These costs can include preaction and postaction fees, which include the cost of legal services prior to the commencement of the proceeding or after entry of judgment. Id. § 767.241(2). In determining whether to award attorney fees, other fees, and costs, the court must consider the financial resources of both parties. Id. § 767.241(1). If awarded, the court may order that the amount be paid directly to the attorney or to the state or county providing services. Id. § 767.241(3).

Family Law Doctrine of Overtrial

Family law has a doctrine called “overtrial” in Wisconsin, which empowers a court to order the offending party to pay attorney fees to the other party. It can be employed when one party’s approach to litigation is unreasonable and causes the other party to incur unnecessary expense. Frisch v. Henrichs, 2007 WI 102, ¶2,n. 1, 304 Wis. 2d 1, 736 N.W.2d 85. A party is deemed to have engaged in overtrial where they handle a case in a manner which creates extremely high costs which were necessitated by their unreasonable approach. Ondrasek v. Ondrasek, 126 Wis. 2d 469, 484, 377 N.W.2d 190 (Wis. App. 1985). The doctrine recognizes that the innocent party who is the victim of overtrial should not be required to bear the financial burden of the offending party’s conduct. Id. Obtaining fees due to overtrial is necessarily fact and case-specific but is a doctrine that family law practitioners should keep in mind.

Conclusion

While this article does not cover all the ways in which a party can seek an award of attorney fees and costs, it provides a survey of methods in Wisconsin a party can seek an award of costs where the other party’s approach to litigation is unreasonable.