Schlosser v. Allis-Chalmers Corp.

222 N.W.2d 156, 65 Wis. 2d 153, 1974 Wisc. LEXIS 1250
CourtWisconsin Supreme Court
DecidedOctober 14, 1974
Docket392
StatusPublished
Cited by36 cases

This text of 222 N.W.2d 156 (Schlosser v. Allis-Chalmers Corp.) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Schlosser v. Allis-Chalmers Corp., 222 N.W.2d 156, 65 Wis. 2d 153, 1974 Wisc. LEXIS 1250 (Wis. 1974).

Opinion

Wilkie, C. J.

Two principal issues are presented on this appeal:

I. Must the class members and their causes of action be joinable under sec. 263.04 or sec. 260.10, Stats., before a class action may be maintained under sec. 260.12?
II. Does this class action involving claims for separate damage recoveries satisfy the requirements of sec. 260.12, Stats.?

The complaint names two plaintiffs, Schlosser and Brown, both retired salaried employees of defendant. Both worked in defendant’s corporate legal department. The named plaintiffs claim to bring this suit on behalf of themselves and “all other retired, non-union salaried employees of defendant who were retired as of February 1, 1973,” a class of about 5,000 persons. The complaint asserts that the members of this class are too numerous to join as named plaintiffs, that the suit involves a question of common or general interest to all members of the class, and that the two named plaintiffs are able to represent the class “fairly and effectively.”

*157 Pláintiffs allege that in about 1930, defendant established a group life insurance program under which it agreed and promised to provide, at its sole expense, various amounts of group life insurance coverage to each nonunion salaried employee during his time of employment and after his retirement. Defendant was to continue assuming the total cost of the insurance during the employee’s entire retirement, but with the face value of the coverage gradually being reduced to specific minimum benefits.

Plaintiffs assert that information about the benefits and coverage of the insurance program was communicated by defendant to these employees from time to time orally and in writing and that the program was offered as part of their contract of employment. Plaintiffs claim that they, and all other members of the class they purport to represent, relied on these promises and agreements concerning the group life insurance program in becoming or continuing as employees, and that they all retired expecting to receive the promised insurance at defendant’s sole expense.

Plaintiffs further allege that in a December 29, 1972, letter, sent to all its retired nonunion salaried employees, defendant announced that effective February 1, 1973, free life insurance coverage would be reduced in face value below previously promised minimum levels. To receive any coverage above these new reduced levels, the employees were told they must pay one dollar per month per thousand dollars face value of additional coverage.

To establish a cause of action based on promissory estoppel, plaintiffs additionally allege that defendant should reasonably have expected its promises concerning the insurance program to induce plaintiffs and the class members to become or remain employees and continue as employees until retirement. Plaintiffs further allege that the promises did so. induce them and the class members, and that injustice can only be avoided through enforcement of the promises.

*158 Plaintiffs seek damages of twenty-five million dollars for themselves and the members of the class.

I. Must the elms members and, their causes of action be joinable under sec. 263.OU or sec. 260.10, Stats., before a class action may be maintained under sec. 260.12?

A. The Opposing Contentions of the Parties.

Defendant argues that before a class action may be maintained, two separate requirements must be satisfied: First, the claims of members of the proposed class must be joinable under sec. 263.04 or sec. 260.10, Stats., and second, the case must meet the conditions contained in sec. 260.12, that the class members be numerous and that their claims present a question of “common or general interest.” Defendant asserts that since each class member has a separate cause of action and seeks separate relief, joinder would be improper under sec. 263.04, and that, therefore, no class action can be maintained.

On the other hand, plaintiffs argue that ability to maintain a class action hinges solely on meeting the requirements of sec. 260.12, Stats. They admit that the individual monetary claims would not be properly joinable under sec. 263.04, and assert that additional qualification under sec. 263.04 is not only unnecessary, but contrary to the basic policy served by the class action doctrine: The avoidance of a multiplicity of suits that involve similar questions of law and fact but which are nevertheless not joinable under restrictive interpretations of joinder statutes.

B. Would Compliance with Joinder Statutes be Possible Here?

At the outset it must be noted that the class members’ claims could not be joined since the members assert separate causes of action that would not affect all the *159 parties to the action. Viewed under the “single occurrence” test, 1 each class member has a separate cause of action. The complaint does allege the existence of only, one group insurance program providing identical benefits (except as to amount of coverage) to each retired nonunion salaried employee. The complaint also alleges that defendant changed the program at the same time and in the same way with respect to all these retired employees. However, the complaint alleges that the benefits of the insurance program devolved upon these employees as part of their separate employment contracts. Thus, when defendant changed the program, in effect it allegedly breached 5,000 separate contracts thereby creating 5,000 similar, but nevertheless legally distinct, causes of action. Since each cause of action affects only one retired employee, the causes of action may not be joined.

For similar reasons, the retired employees could not avail themselves of the party joinder provision 2 of sec. 260.10, Stats., which provides:

“All persons having an interest in the subject of the action or in obtaining the relief demanded may be joined as plaintiffs.”

There is no one “subject of the action” here. The retired employees do not seek to divide a common fund or determine ownership rights to property in which they all claim an interest. Nor do they have an interest “in obtaining *160 the relief demanded,” since they each seek a separate damages recovery. 3

C. Is Compliance with Joinder Statutes Required?

Since neither the class members nor their claims may be joined under secs. 260.10 or 263.04, Stats., the issue is crucial whether compliance with these statutes is a necessary prerequisite to maintenance of a class action under sec. 260.12. We conclude that it is not. 4

In a long unbroken line of cases, this court has considered the propriety of maintenance of class actions only in terms of the criteria contained in sec. 260.12, Stats., never once even referring to sees.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Carney v. CNH Health & Welfare Plan
2007 WI App 205 (Court of Appeals of Wisconsin, 2007)
Hermanson v. Wal-Mart Stores, Inc.
2006 WI App 36 (Court of Appeals of Wisconsin, 2006)
Cruz v. All Saints Healthcare System, Inc.
2001 WI App 67 (Court of Appeals of Wisconsin, 2001)
Gillen v. City of Neenah
580 N.W.2d 628 (Wisconsin Supreme Court, 1998)
State v. Elliott
551 N.W.2d 850 (Court of Appeals of Wisconsin, 1996)
State v. Taylor
489 N.W.2d 664 (Court of Appeals of Wisconsin, 1992)
Sisters of St. Mary v. AAER Sprayed Insulation
445 N.W.2d 723 (Court of Appeals of Wisconsin, 1989)
Opinion No. Oag 25-88, (1988)
77 Op. Att'y Gen. 113 (Wisconsin Attorney General Reports, 1988)
Owens-Illinois, Inc. v. Town of Bradley
392 N.W.2d 104 (Court of Appeals of Wisconsin, 1986)
Ballenger v. Door County
388 N.W.2d 624 (Court of Appeals of Wisconsin, 1986)
Strong v. Wisconsin Chapter of Delta Upsilon
370 N.W.2d 285 (Court of Appeals of Wisconsin, 1985)
Strong v. WIS. CHAPTER OF DELTA UPSILON
370 N.W.2d 285 (Court of Appeals of Wisconsin, 1985)
Vinci v. American Can Co.
459 N.E.2d 507 (Ohio Supreme Court, 1984)
State v. Smith
316 N.W.2d 124 (Court of Appeals of Wisconsin, 1982)
Opinion No. Oag 61-81, (1981)
70 Op. Att'y Gen. 250 (Wisconsin Attorney General Reports, 1981)
Fred Rueping Leather Co. v. City of Fond Du Lac
298 N.W.2d 227 (Court of Appeals of Wisconsin, 1980)
Heaton v. Independent Mortuary Corp.
294 N.W.2d 15 (Wisconsin Supreme Court, 1980)
State v. Neitzel
289 N.W.2d 828 (Wisconsin Supreme Court, 1980)
Mercury Records Productions, Inc. v. Economic Consultants, Inc.
283 N.W.2d 613 (Court of Appeals of Wisconsin, 1979)
Mayer v. Mayer
283 N.W.2d 591 (Court of Appeals of Wisconsin, 1979)

Cite This Page — Counsel Stack

Bluebook (online)
222 N.W.2d 156, 65 Wis. 2d 153, 1974 Wisc. LEXIS 1250, Counsel Stack Legal Research, https://law.counselstack.com/opinion/schlosser-v-allis-chalmers-corp-wis-1974.