3
Jurisdiction
Kim Grimmer
Jeanette Lytle
I.
[§ 3.1]
Scope of Chapter . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
II.
[§ 3.2] Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
A. [§ 3.3] Jurisdiction in General . . . . . . . . . . . . . . . . . . . . . .
B. [§ 3.4] Jurisdictional Alternatives . . . . . . . . . . . . . . . . . . .
C. [§ 3.5] Jurisdiction Distinguished from Venue . . . . . . . . .
D. [§ 3.6] Preliminary Strategic Considerations . . . . . . . . . .
1. [§ 3.7] In General . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.8] Checklist . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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III.
[§ 3.9] Subject Matter Jurisdiction . . . . . . . . . . . . . . . . . .
A. [§ 3.10] Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
B. [§ 3.11] Wisconsin Subject Matter Jurisdiction . . . . . . . .
1. [§ 3.12] Legal Bases . . . . . . . . . . . . . . . . . . . . . . . . . .
a. [§ 3.13] Constitutional Bases . . . . . . . . . . . . . . . . .
b. [§ 3.14] Statutory Bases . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.15] Limits on Circuit Court Jurisdiction . . . . . . .
a. [§ 3.16] In General . . . . . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.17] Small Claims Court . . . . . . . . . . . . . . . . .
c. [§ 3.18] Municipal Court . . . . . . . . . . . . . . . . . . . .
d. [§ 3.19] Administrative Remedies . . . . . . . . . . . . .
e. [§ 3.20] Time Limits . . . . . . . . . . . . . . . . . . . . . . .
3. [§ 3.21] Challenges to a Court’s Competency to
Exercise Subject Matter Jurisdiction . . . . . . .
a. [§ 3.22] In General . . . . . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.23] Subject Matter Jurisdiction vs.
Competency . . . . . . . . . . . . . . . . . . . . . . .
c. [§ 3.24] When Challenge Must Be Raised;
Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) [§ 3.25] In General . . . . . . . . . . . . . . . . . . . .
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(2) [§ 3.26] Counsel’s Ethical Duty . . . . . . . . . .
(3) [§ 3.27] Statutory Requirements . . . . . . . . . .
(4) [§ 3.28] Collateral Challenge; Issue
Preclusion . . . . . . . . . . . . . . . . . . . . .
C. [§ 3.29] Federal Subject Matter Jurisdiction . . . . . . . . . . .
1. [§ 3.30] Legal Bases . . . . . . . . . . . . . . . . . . . . . . . . . .
a. [§ 3.31] Constitutional Basis . . . . . . . . . . . . . . . . .
b. [§ 3.32] Statutory Bases . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.33] Federal Question Jurisdiction . . . . . . . . . . . .
a. [§ 3.34] Statutory Basis . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.35] Tests for Federal Question
Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . .
c. [§ 3.36] Types of Federal Question Cases . . . . . . .
3. [§ 3.37] Diversity Jurisdiction . . . . . . . . . . . . . . . . . .
a. [§ 3.38] Statutory Basis . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.39] Complete Diversity Requirement . . . . . . .
c. [§ 3.40] How Citizenship Is Determined . . . . . . . .
(1) [§ 3.41] Individuals . . . . . . . . . . . . . . . . . . . .
(2) [§ 3.42] Corporations . . . . . . . . . . . . . . . . . . .
d. [§ 3.43] When Citizenship Is Determined . . . . . . .
e. [§ 3.44] Jurisdictional Amount Requirement . . . .
D. [§ 3.45] Indian Tribe Jurisdiction . . . . . . . . . . . . . . . . . . .
E. [§ 3.46] Relationship Between State and Federal
Subject Matter Jurisdiction . . . . . . . . . . . . . . . . .
1. [§ 3.47] State General Jurisdiction Compared to
Federal Limited Jurisdiction . . . . . . . . . . . . .
2. [§ 3.48] Areas of Exclusive Federal Jurisdiction . . . .
3. [§ 3.49] Federal Supplemental Jurisdiction . . . . . . . .
4. [§ 3.50] Concurrent Jurisdiction . . . . . . . . . . . . . . . . .
a. [§ 3.51] Concurrent Federal and State
Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.52] Types of Concurrent Jurisdiction
Cases . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5. [§ 3.53] Removal of State Actions to Federal
District Courts . . . . . . . . . . . . . . . . . . . . . . . .
IV.
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[§ 3.54] Personal Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . 43
A. [§ 3.55] In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
B. [§ 3.56] General vs. Specific Personal Jurisdiction . . . . . 44
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C. [§ 3.57] Determination of Whether Court Has Personal
Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1. [§ 3.58] In General . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.59] Service of Process . . . . . . . . . . . . . . . . . . . . .
3. [§ 3.60] Statutory Basis . . . . . . . . . . . . . . . . . . . . . . . .
4. [§ 3.61] Due Process . . . . . . . . . . . . . . . . . . . . . . . . . .
D. [§ 3.62] Wisconsin Long-Arm Statute . . . . . . . . . . . . . . .
1. [§ 3.63] In General . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.64] General Personal Jurisdiction . . . . . . . . . . . .
a. [§ 3.65] In General . . . . . . . . . . . . . . . . . . . . . . . . .
b. [§ 3.66] Physical Presence Within State . . . . . . . .
c. [§ 3.67] Wisconsin Domicile . . . . . . . . . . . . . . . . .
d. [§ 3.68] Domestic Corporation, Limited
Liability Company, or Limited
Liability Partnership . . . . . . . . . . . . . . . . .
e. [§ 3.69] Substantial Activities Within State . . . . .
3. [§ 3.70] Specific Personal Jurisdiction . . . . . . . . . . . .
a. [§ 3.71] Local Act or Omission . . . . . . . . . . . . . . .
b. [§ 3.72] Local Injury; Foreign Act or
Omission . . . . . . . . . . . . . . . . . . . . . . . . .
(1) [§ 3.73] In General . . . . . . . . . . . . . . . . . . . .
(2) [§ 3.74] Standards for Tortious Conduct . . . .
(3) [§ 3.75] Timing . . . . . . . . . . . . . . . . . . . . . . .
(4) [§ 3.76] Proof . . . . . . . . . . . . . . . . . . . . . . . .
c. [§ 3.77] Local Services, Goods, or Contracts . . . .
d. [§ 3.78] Local Property . . . . . . . . . . . . . . . . . . . . .
e. [§ 3.79] Deficiency Judgments in Foreclosure
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
f. [§ 3.80] Officers and Directors . . . . . . . . . . . . . . .
g. [§ 3.81] Taxes or Assessments . . . . . . . . . . . . . . .
h. [§ 3.82] Insurance or Insurers . . . . . . . . . . . . . . . .
i. [§ 3.83] Certain Marital Actions . . . . . . . . . . . . . .
j. [§ 3.84] Personal Representatives . . . . . . . . . . . . .
k. [§ 3.85] Joinder of Claims . . . . . . . . . . . . . . . . . . .
4. [§ 3.86] Special Jurisdictional Statutes . . . . . . . . . . . .
E. [§ 3.87] Consent to Personal Jurisdiction . . . . . . . . . . . . .
1. [§ 3.88] Consent by Individuals and Corporations . . .
2. [§ 3.89] Consent by the State; Sovereign
Immunity from Suit . . . . . . . . . . . . . . . . . . . .
F. [§ 3.90] Waiver of Defense of Lack of Personal
Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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§ 3.1
V.
G. [§ 3.91] Concurrent Personal Jurisdiction . . . . . . . . . . . . .
H. [§ 3.92] Challenges to Personal Jurisdiction:
Procedural Considerations . . . . . . . . . . . . . . . . . .
1. [§ 3.93] In General . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.94] Direct Challenges . . . . . . . . . . . . . . . . . . . . .
3. [§ 3.95] Collateral Challenges . . . . . . . . . . . . . . . . . . .
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[§ 3.96] In Rem and Quasi in Rem Jurisdiction . . . . . . . . .
A. [§ 3.97] In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
B. [§ 3.98] In Rem Jurisdiction . . . . . . . . . . . . . . . . . . . . . . .
C. [§ 3.99] Quasi in Rem Jurisdiction . . . . . . . . . . . . . . . . . .
1. [§ 3.100] In General . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.101] Garnishment and Attachment . . . . . . . . . . . .
D. [§ 3.102] Minimum Contacts Requirement . . . . . . . . . . . .
E. [§ 3.103] Strategic Considerations . . . . . . . . . . . . . . . . . . .
1. [§ 3.104] Plaintiff . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. [§ 3.105] Defendant . . . . . . . . . . . . . . . . . . . . . . . . . . .
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I. [§ 3.1] Scope of Chapter
An attorney instituting or defending a civil action must determine
whether the court has both (1) subject matter jurisdiction and (2) either
personal jurisdiction over the parties or in rem jurisdiction over the property
that is the subject of the action. The subject matter jurisdiction of a court
is its power to hear and decide the particular kind of case pending before it.
The personal jurisdiction of a court is its power to hear and adjudicate a
case involving the particular defendants in the case. In rem or quasi in rem
jurisdiction is a court’s power to adjudicate the interests of persons in the
particular property that is the subject of the case. A court that lacks either
subject matter jurisdiction or both personal jurisdiction and in rem
jurisdiction generally may not issue a valid judgment (although a defense
of lack of personal jurisdiction may be waived, see infra § 3.90).
This chapter first discusses subject matter jurisdiction. It addresses state,
federal, and Indian tribe subject matter jurisdiction and the relationship
between them; the constitutional and statutory limits on courts’ subject
matter jurisdiction; and the removal of actions filed in state court to federal
district courts. Direct and collateral challenges to a court’s subject matter
jurisdiction are also reviewed.
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§ 3.3
The chapter then discusses the bases for establishing personal jurisdiction over a defendant. The Wisconsin long-arm statute, section 801.05 of
the Wisconsin Statutes,1 which authorizes the court to exercise personal
jurisdiction over out-of-state defendants, is reviewed in some detail.
Constitutional due process limits on the use of the long-arm statute are
discussed as well. The need for proper service of process to obtain personal
jurisdiction is discussed at length in Chapter 6, infra.
Finally, the chapter discusses in rem and quasi in rem jurisdiction. The
chapter considers the ability of a court to adjudicate rights in real or
personal property located within Wisconsin’s borders when a defendant
having an interest in the property is located outside those borders and has
little substantive contact with the state.
Challenges to a court’s jurisdiction are discussed generally in sections
3.21–.28 (subject matter jurisdiction) and 3.92–.95 (personal jurisdiction),
infra.
Motions to dismiss based on lack of jurisdiction over the subject matter
or over the person or property are discussed more particularly in sections
9.16 and 9.17, infra, respectively.
II. [§ 3.2] Introduction
A. [§ 3.3] Jurisdiction in General
The jurisdiction of a court is its power to hear a particular case and
render a valid judgment. To issue a valid and binding judgment against a
party personally, the court must have (1) subject matter jurisdiction (and the
competency to exercise that jurisdiction) and (2) either personal jurisdiction
or in rem/quasi in rem jurisdiction over property in which the person has an
interest. Wis. Stat. § 801.04(1), (2). If a judgment is rendered by a court
lacking jurisdiction (or competency to exercise that jurisdiction), the
judgment may be subject to direct attack on appeal, or collateral attack
seeking to have the judgment voided or otherwise declared unenforceable
in a subsequent proceeding. See infra §§ 3.21–.28 (challenges to subject
1
Unless otherwise indicated, all references in this chapter to the Wisconsin
Statutes are to the 1999–2000 Wisconsin Statutes, as affected by acts through 2001
Wisconsin Act 43. Textual references to the Wisconsin Statutes are hereinafter
indicated as “chapter xxx” or “section xxx.xx,” without the designation “of the
Wisconsin Statutes.”
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§ 3.4
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matter jurisdiction), .92–.95 (challenges to personal jurisdiction), .102
(challenges to in rem jurisdiction). Questions of jurisdiction therefore
should be given priority, since if there is no jurisdiction there is no authority
to proceed. Vermont Agency of Natural Resources v. United States, 529
U.S. 765, 778 (2000). In evaluating a court’s jurisdiction, either subject
matter jurisdiction or personal jurisdiction may be considered first; there is
no particular jurisdictional hierarchy. Ruhrgas AG v. Marathon Oil Co.,
526 U.S. 574, 578 (1999).
The subject matter jurisdiction of a court is conferred by constitution,
statute, and, to a very limited extent, case law, and may not be expanded by
agreement of the parties to the case. Wis. Stat. § 801.04(1). By contrast,
personal jurisdiction is a limitation on the court’s power that is primarily
imposed to protect the personal convenience interests of a nonresident
defendant.2 Thus, personal jurisdiction may be conferred on a court by the
defendant’s consent or by the defendant’s failure to raise lack personal
jurisdiction in a timely manner as a defense. Wis. Stat. §§ 802.06(8)(a),
801.06; see, e.g., Lees v. DILHR, 49 Wis. 2d 491, 499, 182 N.W.2d 245
(1971).
' Note. While it is common to speak of a court’s jurisdiction, judicial
power actually rests with the state or other sovereign entity, which
apportions that power among its courts as it sees fit. A court is
competent to exercise jurisdiction if the state has distributed power to it.
B. [§ 3.4] Jurisdictional Alternatives
Within Wisconsin, most disputes will fall under state or federal
jurisdiction, or both. However, it is also possible that a dispute will be
subject to Indian tribal court jurisdiction. See, e.g., Landreman v. Martin,
191 Wis. 2d 787, 794–95, 530 N.W.2d 62 (Ct. App. 1995). Indian tribe
jurisdiction in general is discussed at section 3.45, infra.
2
While considerations of state sovereignty give states an independent interest
in the exercise of jurisdiction over their citizens, this interest may be waived by the
defendant.
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§ 3.7
C. [§ 3.5] Jurisdiction Distinguished from Venue
Jurisdiction and venue are two related but distinct topics. Enpro
Assessment Corp. v. Enpro Plus, Inc., 171 Wis. 2d 542, 549, 492 N.W.2d
325 (Ct. App. 1992). Jurisdiction determines the power of the court to
decide the matter; venue merely determines where, within the state, the
matter should be tried. Id. See generally supra §§ 2.40–.54 (venue).3
The test for determining proper venue is similar to the test for appropriate jurisdiction. Enpro, 171 Wis. 2d at 549. However, whereas long-arm
statutes are to be construed liberally in favor of jurisdiction, Schroeder v.
Raich, 89 Wis. 2d 588, 593, 278 N.W.2d 871 (1979), venue statutes are not
to be construed liberally in favor of proper venue. Enpro, 171 Wis. 2d at
549 n.4. A defect in venue will not affect the validity of a judgment, Wis.
Stat. § 801.50(1), and a court may, in its discretion, change venue to any
county in the interest of justice or for the convenience of parties or
witnesses, Wis. Stat. § 801.52; see supra § 2.51–.54.
D. [§ 3.6] Preliminary Strategic Considerations
1. [§ 3.7] In General
The vast majority of cases filed in Wisconsin state courts do not present
any questions as to proper jurisdiction. Most cases involve claims that are
unquestionably within the subject matter jurisdiction of the Wisconsin
courts (e.g., collection and foreclosure actions, contract disputes, divorce
cases, personal injury actions, and administrative review cases). Furthermore, the defendants in the majority of such cases are clearly within the
personal jurisdiction of the Wisconsin courts because they are individuals
domiciled within the state or corporations that are either incorporated in
Wisconsin or doing substantial business in the state. Nevertheless, issues
of jurisdiction must be carefully considered for tactical or strategic purposes
even when state court jurisdiction seems clear. The checklist in section 3.8,
infra, sets forth considerations that may affect a plaintiff’s decision whether
to file an action in state or federal court or a defendant’s decision whether
3
Note, however, that the Wisconsin Consumer Act treats venue as a jurisdictional issue in consumer credit transactions, such that failure to have proper venue
renders the judgment invalid from the time of entry. Kett v. Community Credit
Plan, Inc., 228 Wis. 2d 1, 12 n.11, 596 N.W.2d 786 (1999).
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§ 3.8
to seek removal of an action from state to federal court or remand from
federal to state court.
If a plaintiff’s strategy favors federal court, the plaintiff may want to
consider whether the complaint may be pleaded to permit suit in a federal
district court in Wisconsin rather than a state circuit court. For example,
since the Western District of Wisconsin typically hears cases faster than
other courts, the plaintiff might choose to name some, rather than all,
possible defendants in order to preserve federal diversity jurisdiction. See
infra §§ 3.37–.44. Similarly, if the defendant believes that a federal judge
will be more likely to consider dismissing the case on some narrow ground
or that the jury in a state court will more likely favor a well-known local
plaintiff, the defendant might want to consider removing a state court case
with concurrent federal subject matter jurisdiction to federal court.
Federal removal jurisdiction and procedures are set out at 28 U.S.C.
§§ 1441–1452 and are discussed generally in section 3.53, infra.
2. [§ 3.8] Checklist
T
Checklist:
Some Factors to Consider in Choosing Forum
G The time that will be afforded for discovery before trial may
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be shorter in one court than another.
The time allotted to the trial of a complex case may be shorter
in one court than another.
Compulsory process to secure in-court testimony of a key
witness may be available in one court and unavailable in
another.
Deposition discovery from out-of-state witnesses may be more
easily obtained using federal discovery procedures.
In federal court, the use of a discovery deposition of an out-ofstate witness may be restricted to the reading of a very short
summary of the witness’s testimony.
The jury pool in a federal court may differ from the jury pool
in a state court as regards education, experience, business
sophistication, political bent, and general empathy for plaintiffs.
Six-person juries are used in both federal districts in Wisconsin, and the verdict from such juries must be unanimous,
unless the parties stipulate otherwise. See Fed. R. Civ. P. 48.
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§ 3.8
In Wisconsin courts, a party may request a jury of more than
six persons (not to exceed 12), and a five-sixths verdict
suffices. See Wis. Stat. §§ 756.06(2)(b), 805.09(2).
' Note. At least one study has concluded that sixperson juries are less favorably disposed to plaintiffs than
12-person juries. See Edward N. Beiser & Rene Varrin,
Six-Member Juries in the Federal Courts, 58 Judicature
425 (1975).
G Judges may be more willing to accommodate scheduling
conflicts in one court system than in another.
G The personal attributes of the judges may differ depending on
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whether the action is filed in state or federal court.
Certain judges may approach areas of law differently (for
example, federal courts historically reacted more favorably to
claims under the Wisconsin Fair Dealership Law than state
courts did).
In a relatively few cases, it may be possible to obtain personal
jurisdiction over an out-of-state defendant or third-party
defendant under federal personal jurisdiction rules and not
under state long-arm statutes.
A defendant may be able to transfer a case from a federal
district court in one state to a federal district court in another
state. By contrast, state courts do not have the power to
transfer actions to the trial courts of other states. The only
recourse in state court is to request a stay of proceedings under
section 801.63, which will require the defendant to make a
rather stringent showing of inconvenience. U.I.P. Corp. v.
Lawyers Title Ins. Corp., 65 Wis. 2d 377, 387, 222 N.W.2d
638 (1974) (trial should be permitted in another state only
upon convincing showing that trying the case in Wisconsin is
likely to result in substantial injustice); see infra § 5.72.
One courthouse may be more accessible to witnesses and
attorneys, and in closer proximity to necessary documents,
than another.
One court may be subject to more congestion than another.
The judges in one system may have demonstrated more
willingness to resolve close questions by dispositive motions
than judges in another.
Some key piece of evidence may be more apt to be excluded
under one system’s rules of evidence than another’s.
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§ 3.9
G The judges in one court system may be more prone to exercise
control over the jury than those in another.
G A recent state court of appeals or supreme court decision may
have signaled the court’s willingness to reconsider and alter a
legal principle of state law that stands between the defendant
and a large verdict. In such a case, the federal court system
(assuming the case could be shifted to it) would likely be
bound to apply applicable state court precedent as it presently
stands, without the type of reconsideration on policy grounds
that might have been available in state court.4
III. [§ 3.9] Subject Matter Jurisdiction
A. [§ 3.10] Definition
The subject matter jurisdiction of a court is its power to hear and decide
the particular type of action pending before it. The subject matter
jurisdiction of a particular court is generally established by the political
authority or sovereign that created the court.
The legal basis of subject matter jurisdiction is in the first instance a
constitution. In the federal court system and some state and tribal court
systems, the judicial power must then be further defined and invested by
statute. In other court systems, including Wisconsin’s, judicial statutes are
said to merely have the effect of redistributing the constitutional grant of
power among the courts in the judicial system. Such statutes are held to be
incapable of divesting the court system as a whole from the constitutional
grant of judicial power. In re Guardianship of Eberhardy, 102 Wis. 2d 539,
550, 307 N.W.2d 881 (1981). However, those statutes can render a court
incompetent to exercise jurisdiction. See supra § 3.3 (Note).
The legal bases of Wisconsin and federal subject matter jurisdiction are
discussed in sections 3.12–.14 and 3.30–.32, infra, respectively. Tribal
court jurisdiction is addressed briefly in section 3.45, infra.
4
Chapter 821, entitled Uniform Certification of Questions of Law Rule, permits
federal appeals courts and the United States Supreme Court to certify questions of
law to the Wisconsin Supreme Court, but only if it appears to the certifying court
that there is no controlling precedent in the decisions of the Wisconsin appellate
courts. See Wis. Stat. § 821.01.
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§ 3.13
B. [§ 3.11] Wisconsin Subject Matter Jurisdiction
1. [§ 3.12] Legal Bases
a. [§ 3.13] Constitutional Bases
The basic grant of judicial power to the Wisconsin courts is found in
article VII, section 2 of the Wisconsin Constitution:
The judicial power of this state shall be vested in a unified court system
consisting of one supreme court, a court of appeals, a circuit court, such trial
courts of general uniform statewide jurisdiction as the legislature may create by
law, and a municipal court if authorized by the legislature under section 14.
This grant of power is further defined in separate sections addressing the
powers of circuit courts, the Wisconsin Supreme Court, and courts of
appeal.
The constitutional basis of the circuit courts’ subject matter jurisdiction
is found in article VII, section 8 of the Wisconsin Constitution:
Except as otherwise provided by law, the circuit court shall have original
jurisdiction in all matters civil and criminal within this state and such appellate
jurisdiction in the circuit as the legislature may prescribe by law. The circuit
court may issue all writs necessary in aid of its jurisdiction.
The constitution establishes the circuit courts as the trial-level courts of
original jurisdiction. The constitutional grant of judicial authority to the
circuit courts is considered extremely broad, extending to all jurisdiction
that was exercised under Anglo-American jurisprudence by courts of law
and courts of chancery. Harrigan v. Gilchrist, 121 Wis. 127, 231, 99 N.W.
909 (1904). Circuit courts are referred to as courts of plenary jurisdiction,
meaning complete or all-encompassing jurisdiction. In re Guardianship of
Eberhardy, 102 Wis. 2d at 549–50.
' Caveat. The language with which the constitutional grant of
judicial power to the circuit courts begins—“Except as otherwise
provided by law”—was added to the section by the Constitutional
Amendment of 1977. This language has been acknowledged to permit
some legislative reallocation of original jurisdiction to other levels of the
unified court system. Id. at 550.
The jurisdiction of the Wisconsin Supreme Court is set out in article VII,
section 3(1)–(3) of the Wisconsin Constitution. The supreme court has
“superintending and administrative authority over all courts.” Wis. Const.
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art. VII, § 3(1). The supreme court has appellate jurisdiction over all courts
and may also hear certain original actions and proceedings. Id. § 3(2). The
supreme court may issue writs in aid of its jurisdiction. Id. Finally, the
supreme court has the power to (1) review judgments and orders of the
court of appeals; (2) remove cases from the court of appeals; and (3) accept
cases on certification by the court of appeals. Id. § 3(3).
The Wisconsin Court of Appeals was created in 1977 by constitutional
amendment. State ex rel. Swan v. Elections Bd., 133 Wis. 2d 87, 92, 394
N.W.2d 732 (1986). The constitutional basis of the Wisconsin Court of
Appeals’ jurisdiction differs somewhat from that of the supreme court and
the circuit courts. The jurisdiction of the supreme court and the circuit
courts has been held to be invested directly by the Wisconsin Constitution,
without the need for any supplementary legislation. Id. at 92–93; Kotecki
& Radtke, S.C. v. Johnson, 192 Wis. 2d 429, 442 n.9, 531 N.W.2d 606 (Ct.
App. 1995). The constitutional grant of jurisdiction to the court of appeals,
in contrast, does require supplementation by the Wisconsin Legislature:
The appeals court shall have such appellate jurisdiction in the district, including
jurisdiction to review administrative proceedings, as the legislature may provide
by law, but shall have no original jurisdiction other than by prerogative writ.
The appeals court may issue all writs necessary in aid of its jurisdiction and
shall have supervisory authority over all actions and proceedings in the courts
in the district.
Wis. Const. art. VII, § 5(3) (emphasis supplied); State ex rel. Swan, 133
Wis. 2d at 93.
b. [§ 3.14] Statutory Bases
As discussed in section 3.13, supra, the Wisconsin circuit courts and the
Wisconsin Supreme Court derive their jurisdiction directly from the
Wisconsin Constitution, whereas the court of appeals derives its jurisdiction
from both the constitution and a legislative grant of authority. State ex rel.
Swan, 133 Wis. 2d at 92–93. However, the legislature may constitutionally
regulate jurisdiction within each court. The legislative regulation of the
supreme court’s jurisdiction is found in sections 751.05, 751.07–.09,
808.05, 808.07, and 808.10. The legislative regulation of the court of
appeals’ jurisdiction is found in sections 752.01–.02, 808.02–.03, and
808.07.
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The legislative articulation of the circuit courts’ subject matter jurisdiction is found in section 753.03. The most pertinent portion of the statute
states:
The circuit courts have the general jurisdiction prescribed for them by article
VII of the constitution and have power to issue all writs, process and commissions provided in article VII of the constitution or by the statutes, or which may
be necessary to the due execution of the powers vested in them. The circuit
courts have power to hear and determine, within their respective circuits, all
civil and criminal actions and proceedings unless exclusive jurisdiction is given
to some other court; and they have all the powers, according to the usages of
courts of law and equity, necessary to the full and complete jurisdiction of the
causes and parties and the full and complete administration of justice . . . .
Because this volume deals with civil procedure before trial, the focus here
is on circuit court subject matter jurisdiction. For a discussion of the
jurisdiction of the Wisconsin appellate courts, see Michael S. Heffernan,
Appellate Practice and Procedure in Wisconsin ch. 2 (State Bar of
Wisconsin CLE Books 2d ed. 1995 & Supp.).
The original jurisdiction of the Wisconsin circuit courts has from time
to time been described by the Wisconsin Supreme Court in terms that make
that jurisdiction seem boundless. For example, in Harrigan v. Gilchrist,
121 Wis. 127, 99 N.W. 909 (1904), Justice Roujet Marshall waxed eloquent
on the original jurisdiction of Wisconsin’s circuit courts: “[S]tanding where
we will and looking where we may, judicial power is present to prevent and
redress wrongs . . . . [T]he jurisdiction of our circuit courts, except as
specially restricted by statute . . . or by the constitution itself . . . is found to
occupy the whole field . . . . ” Id. at 227 (quoted in In re Guardianship of
Eberhardy, 102 Wis. 2d at 549). In Mueller v. Brunn, 105 Wis. 2d 171,
176, 313 N.W.2d 790 (1982), the court said simply: “No circuit court is
without subject matter jurisdiction to entertain actions of any nature
whatsoever.” Such proclamations notwithstanding, there are a number of
limits on the subject matter jurisdiction of Wisconsin circuit courts. These
limits are discussed in sections 3.15–.20, infra.
2. [§ 3.15] Limits on Circuit Court Jurisdiction
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a. [§ 3.16] In General
A number of Wisconsin appellate cases have cited the statement from
Mueller v. Brunn, 105 Wis. 2d at 176, that the subject matter jurisdiction of
Wisconsin circuit courts, having been vested directly by the state constitution, is so expansive that “[n]o circuit court is without subject matter
jurisdiction to entertain actions of any nature whatsoever.” As a quick,
general formulation of the very expansive original jurisdiction granted by
the Wisconsin Constitution to the circuit courts, the statement suffices.
However, it fails to take into account the significant limits imposed by the
legislature and the U.S. Constitution on the circuit courts’ competency to
exercise subject matter jurisdiction.
' Comment. In fairness to the Mueller court, it should be noted that
the court did qualify the statement quoted in the preceding paragraph.
In the sentence immediately following that statement, the court
acknowledged the power of the Wisconsin Legislature to abolish
specific common law actions and to set up administrative systems for
adjusting rights. See id. However, the qualifying language is seldom
quoted.
Wisconsin circuit court subject matter jurisdiction is subject to many
limits, some of which are listed below. See also infra §§ 3.17–.20.
1. The sovereignty of other governing bodies, including other states, the
federal government, and Indian tribes;
2. The exclusive jurisdiction of federal courts over certain claims derived
from federal law, see infra § 3.48;
3. The power of the Wisconsin Supreme Court, in exercising superintending jurisdiction over the Wisconsin court system, to modify or
eliminate competency to exercise subject matter jurisdiction over certain
claims or types of claims, see, e.g., In the Interest of Tiffany W., 192
Wis. 2d 407, 424, 532 N.W.2d 135 (Ct. App. 1995);
4. The power of the Wisconsin Legislature to statutorily adjust or eliminate
common law rights;
5. The power of the Wisconsin Legislature to create new statutory rights,
with primary jurisdiction over claims vested in state administrative
agencies, see infra § 3.19;
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6. The power of the Wisconsin Legislature to create or alter procedural
prerequisites to the competency of a court to exercise jurisdiction, such
as time limits, see infra § 3.20, or mediation/arbitration requirements;
7. The power of the Wisconsin Legislature to require that certain claims be
brought under the small claims procedures specified in chapter 799, see
infra § 3.17; and
8. The power of the Wisconsin Legislature to authorize the establishment
of municipal courts to hear actions arising under municipal ordinances,
see infra § 3.18.
' Note. Although many circuit courts segregate civil and criminal
cases, for purposes of a court’s subject matter jurisdiction, it is
immaterial whether the petition is filed with a civil or criminal case
number, or whether a judge currently assigned to a civil or criminal
branch hears the case. In re Pharm, 2000 WI App 167, ¶ 24, 238
Wis. 2d 97, 617 N.W.2d 163.
b. [§ 3.17] Small Claims Court
Small claims “court” is actually not a separate constitutional or
legislative court. It is, rather, a procedure mandated by statute for particular
types of claims. Many small claims are defined in terms of an upper
jurisdictional limit of $5,000. Section 799.01 sets out the claims for which
small claims procedure is mandatory:
1. Eviction actions (whether based on residential or commercial occupancy, trespass, or adverse possession), Wis. Stat. § 799.01(1)(a);
' Note. Claims for back rent or damages, if joined to an eviction
request, are not subject to the $5,000 limit found in other subsections
of section 799.01. Id.
2. Actions for the return of earnest money tendered pursuant to a contract
for the purchase of real estate by sale, exchange, or land contract, Wis.
Stat. § 799.01(1)(am);
3. Actions for civil forfeitures (unless a different procedure is spelled out
in a specific statute establishing a forfeiture), Wis. Stat. § 799.01(1)(b);
see also 61 Wis. Op. Att’y Gen. 88 (1989);
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4. Replevin actions under sections 810.01–.13 in which the value of the
property claimed does not exceed $5,000, Wis. Stat. § 799.01(1)(c);
' Comment. If the value of the property claimed in a replevin
action is $5,000 or less, small claims procedure would appear to be
mandatory even if the sum of the property value and any damage
claims arising out of the wrongful deprivation of the property
exceeds $5,000. See id.
5. Actions seeking to confirm, vacate, modify, or correct an arbitration
award concerning a dispute arising out of a transaction for the purchase
of real estate, Wis. Stat. § 799.01(1)(cm);
6. Money judgments for $5,000 or less, Wis. Stat. § 799.01(1)(d)1.;
7. Attachment actions in which the amount owed the plaintiff (not the
value of the property to be attached) is $5,000 or less, Wis. Stat.
§ 799.01(1)(d)2.;
8. Garnishment actions in which the amount owed the plaintiff is $5,000
or less, id.; and
9. Actions to enforce a lien on personalty when the amount of debt claimed
is $5,000 or less, Wis. Stat. § 799.01(1)(d)3.
In addition, section 425.205 mandates small claims procedure for replevin
actions under the Wisconsin Consumer Act, “notwithstanding [section]
799.01(1)(c) [restricting small claims procedure to replevin of goods worth
$5,000 or less] and the value of the collateral or leased goods sought to be
recovered.”
A case that appropriately starts out under small claims procedure may
later have to be transferred to the regular circuit court docket if changes in
its character render the small claims court incompetent to exercise
jurisdiction. For example, the filing by a defendant of a counterclaim that
has a value greater than $5,000 and that arises out of the same transaction
as the plaintiff’s claim will require transfer of the action to the regular
circuit court docket. Wis. Stat. § 799.02(1). A similar result obtains when
a defendant files a transactionally related cross-claim for more than $5,000
against a co-defendant. Id. If the counterclaim or cross-claim is not
transactionally related to the plaintiff’s claim and is for more than $5,000,
the court must dismiss the claim without prejudice and proceed with the
remaining claim under small claims procedure. Wis. Stat. § 799.02(2).
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' Practice Tip. Small claims procedure may vary from one county
to another. Thus, litigants are well advised to contact the clerk of the
small claims division of the specific county in which the case is venued
to determine the local procedural rules. For a comprehensive discussion
of small claims procedure under chapter 799, see Wisconsin Judicial
Benchbook—Civil ch. 42 (State Bar of Wisconsin CLE Books 2d ed.
2000 & Supp.). Service of process in small claims actions is discussed
in sections 6.58–.62, infra.
c. [§ 3.18] Municipal Court
Article VII, section 14 of the Wisconsin Constitution allows the
legislature to authorize each city, village, and town to establish a municipal
court to hear actions arising under the ordinances of the municipality.
Chapter 755 is the enabling legislation that sets out the procedures for a
municipality’s establishment of a municipal court.
A municipal court established under chapter 755 has exclusive
jurisdiction over an action in which the municipality seeks to impose
forfeitures for violations of its municipal ordinances except as follows:
1. If the action is transferred under section 800.04(1) or 800.05(3) to a
court of record;
2. If equitable relief is demanded, in which case the plaintiff must bring the
action in a court of record; or
3. Whenever the municipal court of a first-class city in any county having
a population of 500,000 or more is not in session, in which case the
circuit court has concurrent jurisdiction to hear municipal court cases.
Wis. Stat. § 755.045(1)(a)–(c).
d. [§ 3.19] Administrative Remedies
The Wisconsin Legislature has directed that a number of types of legal
disputes, otherwise within the original subject matter jurisdiction of the
circuit courts, are to be handled through quasi-judicial proceedings before
state agencies or boards. The matters set forth in the following checklist are
among those for which primary jurisdiction has been vested in a Wisconsin
agency or board, subject to subsequent subject matter jurisdiction in the
circuit courts.
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T
Checklist: Legal Matters Under Primary
Jurisdiction of Administrative Agencies or Boards
G Worker’s compensation claims, Wis. Stat. ch. 102.
G Unemployment compensation claims, Wis. Stat. ch. 108.
G Employment discrimination claims, Wis. Stat. §§ 111.31–
.395.
G State tax disputes, Wis. Stat. ch. 71.
G Disputes regarding the siting of solid waste disposal facilities,
Wis. Stat. ch. 144.
' Note. It is possible for both a circuit court and an administrative
agency to have jurisdiction over a dispute. See County of Dane v. Dane
County Union Local 65, 210 Wis. 2d 267, 275, 565 N.W.2d 540 (Ct.
App. 1997). Under those circumstances, a question arises as to which
tribunal has primary jurisdiction. Id. A circuit court should retain
jurisdiction when issues of law predominate and should decline to
exercise jurisdiction when factual issues are significant. McEwen v.
County of Pierce, 90 Wis. 2d 256, 271, 279 N.W.2d 469 (1979). The
decision rests in the circuit court’s discretion. Id. at 268, 271; see also
Wisconsin End-User Gas Ass’n v. Public Serv. Comm’n, 218 Wis. 2d
558, 569, 581 N.W.2d 556 (Ct. App. 1998).
' Comment. It could be argued that the Wisconsin Legislature, by
granting primary jurisdiction for certain legal matters to administrative
agencies and boards, has overridden the express constitutional grant of
original jurisdiction to the Wisconsin circuit courts. This argument
would have particular validity as regards legal disputes that were
historically within the jurisdiction of the courts of law or chancery.
Actually, most of the claims for which administrative remedies have
been established have their basis not in common law but in statutes (e.g.,
worker’s compensation and unemployment compensation claims).
Moreover, as noted by the Wisconsin Supreme Court, in all instances in
which an agency or board exercises quasi-judicial power, the circuit
courts have ultimate subject matter jurisdiction to review and reconsider
decisions of the agency or board. See Mueller, 105 Wis. 2d at 176.
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e. [§ 3.20] Time Limits
A court’s competency to exercise jurisdiction may be affected by time
limits. Some time limits are mandatory, such as the time for conducting a
hearing under section 48.30(7) or the time for filing petitions for review to
the supreme court under section 808.10. A failure to comply with such time
limits deprives the court of its competency to exercise subject matter
jurisdiction. State ex rel. Schmelzer v. Murphy, 195 Wis. 2d 1, 7–8, 535
N.W.2d 459 (Ct. App. 1995), rev’d on other grounds, 201 Wis. 2d 246, 548
N.W.2d 45 (1996); In the Interest of David A.H., No. 95-0017, 1995 WL
314571, *2 (Wis. Ct. App. May 25, 1995) (unpublished opinion not to be
cited as precedent or authority per section 809.23(3)).
Other time limits, such as statutes of limitation, are subject to judicial
exceptions such as waiver and estoppel. See supra § 2.56. Consequently,
they do not affect a court’s competency to exercise subject matter jurisdiction. County of Milwaukee v. LIRC, 113 Wis. 2d 199, 205, 335 N.W.2d 412
(Ct. App. 1983). The question to be asked is whether the time limit
completely divests the court of the right to proceed.
3. [§ 3.21] Challenges to a Court’s Competency to
Exercise Subject Matter Jurisdiction
a. [§ 3.22] In General
Because the subject matter jurisdiction of Wisconsin circuit courts is so
expansive, challenges to the exercise of that jurisdiction will usually be
based on one of the following arguments:
1. Federal court jurisdiction is exclusive. See infra § 3.48.
2. The plaintiff failed to follow proper procedure in commencing the action
(e.g., the plaintiff filed a claim in small claims court that was over the
$5,000 limit, see supra § 3.17).
3. The plaintiff did not exhaust administrative procedures mandated for the
plaintiff’s claim. See supra § 3.19.
4. The plaintiff or the court failed to observe some mandatory time limit.
See supra § 3.20.
For a discussion of motions to dismiss for lack of subject matter
jurisdiction, see section 9.16, infra.
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' Note. Challenges to a court’s competency to exercise subject matter
jurisdiction must be distinguished from challenges to the plaintiff’s
complaint for failure to state a cause of action recognized at law. A
court must assume subject matter jurisdiction in order to determine
whether the plaintiff has failed to state a proper cause of action. Murphy
v. Miller Brewing Co., 50 Wis. 2d 323, 327, 184 N.W.2d 141 (1971).
b. [§ 3.23] Subject Matter Jurisdiction vs.
Competency
When discussing challenges to a court’s competency to exercise subject
matter jurisdiction, it is helpful to keep in mind the differences between
jurisdiction and the competency to exercise that jurisdiction. Jurisdiction
is the power to adjudicate, and this power is vested in the state or other
sovereign. Competency is the right to exercise the power to adjudicate; a
state confers this right on its courts and often conditions the right on certain
procedural prerequisites. Cepukenas v. Cepukenas, 221 Wis. 2d 166, 584
N.W.2d 227 (Ct. App. 1998).
As previously noted, the Wisconsin Supreme Court construed the
constitutional grant of subject matter jurisdiction to the Wisconsin circuit
courts very broadly in Mueller v. Brunn (“[n]o circuit court is without
subject matter jurisdiction to entertain actions of any nature whatsoever,”
105 Wis. 2d at 176), and subsequent supreme court and court of appeals
decisions have cited this language approvingly. See supra §§ 3.14, .16.
Since the Mueller decision, very few Wisconsin decisions have discussed
the court’s ability to adjudicate a particular case in terms of its subject
matter jurisdiction. Instead of questioning a court’s power, a court more
correctly should address its competency to exercise that power in a
particular case. See, e.g., In the Interest of B.J.N., 162 Wis. 2d 635, 656–57
& n.17, 469 N.W.2d 845 (1991); In re Commitment of Beyer, 2001 WI App
167, ¶ 6 n.2, 247 Wis. 2d 13, 633 N.W.2d 627; Wall v. Department of
Revenue, 157 Wis. 2d 1, 458 N.W.2d 814 (Ct. App. 1990).
A court may lose competency and be prevented from adjudicating a
specific case by failing to comply with a statutory mandate, that is, failing
to follow plainly prescribed procedures that are “central” to the statutory
scheme. In re Commitment of Bollig, 222 Wis. 2d 558, 565–66, 587
N.W.2d 908 (Ct. App. 1998). To determine whether a defect is “central”
to the statutory scheme, the fundamental/technical dichotomy of a personal
jurisdiction analysis is instructive. Id. at 568; see also infra § 3.59.
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c. [§ 3.24] When Challenge Must Be Raised;
Waiver
(1) [§ 3.25] In General
Historically, Wisconsin case law held that a defense of lack of subject
matter jurisdiction could not be waived. Rather, the defense could be raised
at the pleading stage, before trial, after trial, on appeal, or even by collateral
attack after final judgment. Figgs v. City of Milwaukee, 116 Wis. 2d 281,
286, 342 N.W.2d 254 (Ct. App. 1983), rev’d on other grounds, 121 Wis. 2d
44, 357 N.W.2d 548 (1984); Bialk v. City of Oak Creek, 98 Wis. 2d 469,
473, 297 N.W.2d 43 (Ct. App. 1980).
The Wisconsin Supreme Court has held that competency cannot be
waived by the parties, despite the fact that past cases have indicated that a
challenge to a court’s competency to exercise jurisdiction may be waived,
see In the Interest of Nadia S., 219 Wis. 2d 296, 303, 581 N.W.2d 182
(1998); Smith v. Herrling, Myse, Swain & Dyer, Ltd., 211 Wis. 2d 787,
793–94, 565 N.W.2d 809 (Ct. App. 1997); Wall v. Department of Revenue,
157 Wis. 2d 1, 7, 458 N.W.2d 814 (Ct. App. 1990).
(2) [§ 3.26] Counsel’s Ethical Duty
The lawyers involved in a lawsuit have an ethical duty, as officers of the
court, to ensure that lawsuits are reasonably supported by existing law and
the facts. See, e.g., Wis. Stat. § 802.05(1)(a) (pleadings, motions, and other
papers must be signed by attorney, and such signature certifies that
document is well grounded in fact and warranted by law or equity); Kelly
v. Clark, 192 Wis. 2d 633, 655, 531 N.W.2d 455 (Ct. App. 1995); see also
supra §§ 1.75–.86. Presumably, this duty includes the obligation to inform
the trial court promptly if it does not have competency to adjudicate a
particular action.
(3) [§ 3.27] Statutory Requirements
The statutes governing pleadings seem to require that a challenge to the
subject matter jurisdiction of the court (or the competency of the court to
exercise jurisdiction) be made promptly. Section 802.06(2) states in part:
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(a) Every defense, in law or fact . . . shall be asserted in the responsive
pleading thereto if one is required, except that the following defenses may at the
option of the pleader be made by motion:
...
2. Lack of jurisdiction over the subject matter.
...
(b) A motion making any of the defenses in par. (a)1. to 10. shall be made
before pleading if a further pleading is permitted.
On the other hand, sections 802.06(7) and 802.06(8)(c) preserve the defense
of lack of subject matter jurisdiction, notwithstanding the mandatory
language of section 802.06(2).
(4) [§ 3.28] Collateral Challenge; Issue
Preclusion
Under some circumstances, the failure to raise the defense of lack
subject matter jurisdiction or competency before judgment may mean that
a collateral attack is barred under the principle of issue preclusion. In In the
Interest of A.E.H., 161 Wis. 2d 277, 287, 468 N.W.2d 190 (1991), the
Wisconsin Supreme Court cited, approvingly, section 12 of the Restatement
of Judgments (Second) (1982), which reads:
Section 12. Contesting Subject Matter Jurisdiction. When a court has rendered
a judgment in a contested action, the judgment precludes the parties from
litigating the question of the court’s subject matter jurisdiction in subsequent
litigation except if:
(1) The subject matter of the action was so plainly beyond the court’s
jurisdiction that its entertaining the action was a manifest abuse of authority; or
(2) Allowing the judgment to stand would substantially infringe the authority
of another tribunal or agency of government; or
(3) The judgment was rendered by a court lacking capability to make an
adequately informed determination of a question concerning its own jurisdiction
and as a matter of procedural fairness the party seeking to avoid the judgment
should have opportunity belatedly to attack the court’s subject matter jurisdiction.
The comments to section 12 indicate that issue preclusion or collateral
estoppel will only prevent later litigation of a court’s competency if that
issue was actually raised and decided. When the parties and court in the
first action presume the trial court’s competency to exercise subject matter
jurisdiction and therefore do not litigate the issue in that action, the
possibility remains that the judgment might at some later time, in a
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subsequent action, be determined to be void. Thus, the restatement seeks
to balance the principle of finality of actions with the principle of judicial
validity.
C. [§ 3.29] Federal Subject Matter Jurisdiction
Without proper subject matter jurisdiction, a federal court cannot
proceed at all. Instead, the court must note the jurisdictional defect and
dismiss the suit. The U.S. Supreme Court has explicitly declined to
recognize the “doctrine of hypothetical jurisdiction,” whereby, despite
jurisdictional objections, lower courts proceeded to the merits when the
merits question was more readily resolved and the party prevailing on the
merits, would be the same as the party that would prevail were jurisdiction
denied. Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 101–02
(1998).
' Note. Contrast this approach to Wisconsin’s practice of analyzing
whether a defect in a court’s competency to exercise subject matter
jurisdiction is “central” to the statutory scheme. See supra § 3.23.
1. [§ 3.30] Legal Bases
a. [§ 3.31] Constitutional Basis
The constitutional grant of judicial power to the federal courts is found
in article III, sections 1 and 2 of the United States Constitution and reads in
pertinent part:
Section 1. The judicial Power of the United States, shall be vested
in one supreme Court, and in such inferior Courts as the Congress may
from time to time ordain and establish.
....
Section 2. The judicial Power shall extend to all Cases, in Law and
Equity, arising under this Constitution [and] the Laws of the United
States[;] . . . —to Controversies to which the United States shall be a
Party; —to Controversies between two or more States; —between a
State and Citizens of another State; —between Citizens of different
States; — . . . and between a State, or the Citizens thereof, and foreign
States, Citizens or Subjects.
In all Cases affecting Ambassadors, other public Ministers and
Consuls, and those in which a State shall be Party, the supreme Court
shall have original Jurisdiction. In all the other Cases before mentioned,
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the supreme Court shall have appellate Jurisdiction, both as to Law and
Fact, with such Exceptions, and under such Regulations as the Congress
shall make.
' Note. The 11th Amendment provides that the judicial power of the
United States does not extend to suits against the states. However,
because a state may waive its 11th Amendment protection, the 11th
Amendment creates a sovereign immunity from suit, rather than a
nonwaivable limit on the federal judiciary’s subject matter jurisdiction.
Idaho v. Coeur d’Alene Tribe, 521 U.S. 261, 267 (1997).
' Note. Be aware that federal courts have subject matter jurisdiction
over only those cases that are “ripe” for adjudication. Forseth v. Village
of Sussex, 199 F.3d 363, 368 (7th Cir. 2000).
b. [§ 3.32] Statutory Bases
As the constitutional grant of judicial power has generally been
interpreted, Congress possesses essentially complete power to confer or
withhold jurisdiction in the federal courts, subject to a constitutional
challenge to the scope of jurisdiction on due process or separation-ofpowers grounds. Westarik Prod. Credit Ass’n v. Fidelity & Deposit Co.,
100 F. Supp. 52, 53 (W.D. Ark. 1951); see, e.g., California v. Deep Sea
Research, Inc., 523 U.S. 491, 507 (1998) (11th Amendment does not bar
federal court’s jurisdiction over in rem admiralty action when res not within
state’s possession). Congress has granted the federal courts two areas of
subject matter jurisdiction that make up the bulk of work in those courts:
(1) jurisdiction over cases arising under federal law (federal question
jurisdiction), and (2) jurisdiction over cases in which the amount in
controversy exceeds $75,000 and the parties to the controversy are of
diverse citizenship (diversity jurisdiction). The statutory bases for federal
question jurisdiction and diversity jurisdiction are discussed in sections 3.34
and 3.38, infra, respectively.
An example of Congress’s power to withhold jurisdiction in federal
courts is the Tax Injunction Act, 28 U.S.C. § 1342, which restricts the
district courts’ power to prevent collection or enforcement of state taxes.
Arkansas v. Farm Credit Servs., 520 U.S. 821, 823–24 (1997).
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2. [§ 3.33] Federal Question Jurisdiction
a. [§ 3.34] Statutory Basis
The statutory basis of federal question jurisdiction is found in 28 U.S.C.
§ 1331, which reads: “The district courts shall have original jurisdiction of
all civil actions arising under the Constitution, laws, or treaties of the
United States.”
' Note. Up until 1980, 28 U.S.C. § 1331 also stated that the amount
in controversy was required to exceed “the sum or value of $10,000.00,
exclusive of interest and costs.” This requirement has been repealed for
federal question cases, cf. infra § 3.44 (jurisdictional amount requirement), with a limited exception found in the Consumer Product Safety
Act, 15 U.S.C. § 2072(a).
b. [§ 3.35] Tests for Federal Question Jurisdiction
The United States Supreme Court has generally taken what many believe
to be an unduly restrictive view of the statutory grant of federal question
jurisdiction to the federal district courts in 28 U.S.C. § 1331. As interpreted
by the Supreme Court, the statute requires a plaintiff, on the face of the
complaint, to squarely base the claim at issue on a federally created right
derived from the federal Constitution or a federal statute.
' Note. An exception to the “well-pleaded complaint” rule applies
when Congress has completely preempted an area of state law. Traynor
v. O’Neil, 94 F. Supp. 2d 1016, 1020–21 (W.D. Wis. 2000). Thus, for
a case to clearly “aris[e] under” federal law for purposes of 28 U.S.C.
§ 1331 and thereby fall within federal question jurisdiction, it is not
sufficient that the plaintiff anticipate and allege that a defendant’s
defense arises under federal law. Louisville & Nashville R.R. v. Mottley,
211 U.S. 149 (1908). Nor is it sufficient that a federal law issue “is
lurking in the background” of the action or is necessary for its ultimate
resolution. Gully v. First Nat’l Bank, 299 U.S. 109, 117 (1936); see,
e.g., T.B. Harms Co. v. Eliscu, 339 F.2d 823, 825–27 (2d Cir. 1964).
Rather, a federal right or immunity must be an essential element of the
plaintiff’s claim in order to bring the case within federal question
jurisdiction. Gully, 299 U.S. at 112. In a declaratory judgment action,
the question becomes whether a federal question would be present on
the face of a complaint by a declaratory defendant in a presumed suit
against the declaratory plaintiff, unless the declaratory defendant is a
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government entity. City of Beloit v. Local 643 of the Am. Fed’n of State,
County and Mun. Employees, 248 F.3d 650, 652–53 (7th Cir. 2001).
' Note. The Seventh Circuit disagrees with the contention that
federal question jurisdiction is restrictive. In Turner/Ozanne v. Hyman/
Power, 111 F.3d 1312 (7th Cir. 1997), the Seventh Circuit held that the
plaintiff’s burden of proving federal question jurisdiction is not onerous;
a federal court has jurisdiction over claims “‘on the margins of reasonable possibility.’” Id. at 1317 (quoting Musson Theatrical, Inc. v.
Federal Express Corp., 89 F.3d 1244, 1248 (6th Cir. 1996)). In Turner/
Ozanne, the court found federal question jurisdiction despite the fact that
it believed that the plaintiff’s case ought not to prevail on the merits.
In determining the existence of federal question jurisdiction, the courts
have used two different tests, referred to here as the American Well Works
test and the Smith test. The American Well Works test, enunciated by
Justice Holmes in American Well Works Co. v. Layne & Bowler Co., 241
U.S. 257 (1916), looks at whether the cause of action “arises under” federal
law. As Justice Holmes stated: “A suit arises under the law that creates the
cause of action.” Id. at 260. This test is widely accepted as a proper means
of determining whether a case falls within the federal question jurisdiction
of the federal courts.
The Smith test, a less frequently applied test for federal question
jurisdiction, originated in Smith v. Kansas City Title & Trust Co., 255 U.S.
180 (1921), a case that did not fit neatly within the American Well Works
test. In Smith, a shareholder of a corporation sued to enjoin the corporation
from investing in Federal Land Bank bonds, which the shareholder alleged
were not validly issued under federal law. The plaintiff’s cause of action
was clearly created under a state law that imposed a duty on corporations
to invest only in validly issued obligations. Further, state law provided the
plaintiff with the rights and remedies on which the plaintiff relied.
However, to state a claim under state law, the plaintiff had to allege why the
bonds were illegally issued, which made the constitutionality of the federal
law under which the bonds were issued a properly pleaded element of the
plaintiff’s claim. The Court upheld federal question jurisdiction in Smith,
stating:
The general rule is that where it appears from the [complaint] of the plaintiff
that the right to relief depends upon the construction or application of the
Constitution or laws of the United States, and that such federal claim is not
merely colorable, and rests upon a reasonable foundation, the District Court has
jurisdiction.
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Id. at 199.
The Smith decision was viewed by many as an aberration, so courts
continued to apply the American Well Works test as the exclusive test for
federal subject matter jurisdiction. However, the Supreme Court revitalized
the Smith test in 1983, citing the case approvingly in Franchise Tax Board
v. Construction Laborers Vacation Trust, 463 U.S. 1, 9 (1983). The Court
noted that leading commentators had suggested that an action “aris[es]
under” federal law for purposes of 28 U.S.C. § 1331 “if in order for the
plaintiff to secure the relief sought he will be obliged to establish both the
correctness and the applicability to his case of a proposition of federal law.”
Id.
The Court later modified and restricted the Smith test in Merrell Dow
Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804 (1986). In a 5–4
decision, the Court held that the Smith test would not support federal
question jurisdiction in the face of statutory language demonstrating
Congressional intent that federal jurisdiction not be available to private
plaintiffs to seek redress for a violation of the drug labeling statute at issue.
Id. at 812, 814. In a footnote, the Court appeared to acknowledge that it is
the nature of the federal interest that is determinative:
The importance of the nature of the federal issue in federal-question jurisdiction
is highlighted by the fact that, despite the usual reliability of the Holmes
[American Well Works] test as an inclusionary principle, this Court has
sometimes found that formally federal causes of action were not properly
brought under federal-question jurisdiction because of the overwhelming
predominance of state law issues.
Id. at 814 n.12 (citations omitted).
In summary, the American Well Works test remains clearly appropriate
to establish subject matter jurisdiction. The Smith test appears to remain
viable as well, unless it can be demonstrated that Congress intended to
foreclose federal jurisdiction to plaintiffs in cases such as the one under
consideration. In close cases, the nature of the federal and state interests
may be determinative.
' Note. Many cases that fall within federal question jurisdiction are
also within the jurisdiction of state courts. If a federal question case is
brought in state courts, the defendant may be able to remove it to federal
court under the federal removal statutes. See 28 U.S.C. §§ 1441–1452;
see also infra § 3.53.
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' Note. Congress has granted the U.S. Supreme Court authority to
review federal question decisions made by state courts when the state
court judgment is final. Jefferson v. City of Tarrant, 522 U.S. 75, 77
(1997).
c. [§ 3.36] Types of Federal Question Cases
The following checklist sets forth some of the more common types of
federal question cases.
T
Checklist:
Federal Question Cases
G Civil rights claims under Title VII of the Civil Rights Act of
G
G
G
G
G
1964, 42 U.S.C. §§ 2000e to 2000e-17.
Claims under the Social Security Act, 42 U.S.C. §§ 401–433.
Civil claims under the Racketeer Influenced and Corrupt
Organizations Act (RICO), 18 U.S.C. §§ 1961–1968.
Claims under the Employee Retirement Income Security Act
(ERISA), 29 U.S.C. §§ 1001–1461.
Challenges to the constitutionality of federal or state laws
(under the U.S. Constitution).
Patent and copyright infringement claims.
3. [§ 3.37] Diversity Jurisdiction
a. [§ 3.38] Statutory Basis
The congressional grant of diversity jurisdiction is found in 28 U.S.C.
§ 1332. Under that statute, the federal district courts have original
jurisdiction over actions in which
1. “the matter in controversy exceeds the sum or value of $75,000,
exclusive of interest and costs”; and
2. the controversy is between (a) citizens of different states; (b) citizens of
a state and citizens or subjects of a foreign state; or (c) citizens of
different states “and in which citizens or subjects of a foreign state are
additional parties.”
28 U.S.C. § 1332(a).
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' Note. When a federal district court entertains an action brought on
the basis of diversity of citizenship, it is hearing a state law claim and is
bound under the Erie doctrine to apply state substantive law, common
and statutory. Erie R.R. v. Tompkins, 304 U.S. 64, 78 (1938).
' Caution. Under federal common law, the federal courts will not
hear family law or probate actions even if there is diversity of citizenship and the amount in controversy exceeds the $75,000 jurisdictional
amount. 13B Charles A. Wright & Arthur R. Miller, Federal Practice
and Procedure § 3609 (2d ed. 1984 & Supp. 2001) [hereinafter Federal
Practice and Procedure].
b. [§ 3.39] Complete Diversity Requirement
Since 1806, the United States Supreme Court has required “complete
diversity” between the plaintiffs and defendants for federal diversity
jurisdiction to exist. See Strawbridge v. Curtiss, 7 U.S. 267, 267 (1806).
This requirement means that all persons on one side of the action must be
of different citizenship than all persons on the opposing side.
' Caveat. Complete diversity is not constitutionally required under
article III, section 2 of the U.S. Constitution. See State Farm Fire &
Cas. Co. v. Tashire, 386 U.S. 523, 530 (1967) (interpreting federal
interpleader statute, 28 U.S.C. § 1335, to require only minimal diversity
—i.e., diversity of citizenship between any two claimants).
' Note. Occasionally, a party may seek to intervene in a federal
district court action. Before the enactment of the current supplemental
jurisdiction statute, 28 U.S.C. § 1367, courts permitted intervention as
of right without an independent jurisdictional basis while permissive
intervention required an independent jurisdictional basis. Turner/
Ozanne v. Hyman/Power, 111 F.3d 1312, 1319 (7th Cir. 1997). The
current supplemental jurisdiction statute continues this practice with
regard to permissive intervention. Id.
c. [§ 3.40] How Citizenship Is Determined
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(1) [§ 3.41] Individuals
The citizenship of individual United States citizens is determined by
domicile. See, e.g., America’s Best Inns, Inc. v. Best Inns of Abilene, L.P.,
980 F.2d 1072, 1074 (7th Cir. 1992). A person’s domicile is the place
where the person maintains a true, fixed, and permanent home and principal
establishment, and to which the person intends to return whenever the
person is absent from the place. Mas v. Perry, 489 F.2d 1396, 1399 (5th
Cir. 1974). For purposes of determining diversity, a person may have only
one domicile at any one time, although the person may actually have homes
in two or more states. Dyer v. Robinson, 853 F. Supp. 169, 172 (D. Md.
1994).
The following special rules apply:
1. A United States citizen domiciled overseas may not be a party to a
diversity case. See, e.g., Cresswell v. Sullivan & Cromwell, 922 F.2d
60, 68 (2d Cir. 1990).
2. An alien admitted to the United States for permanent residence is
deemed a citizen of the state in which the alien is domiciled. 28 U.S.C.
§ 1332(a).
3. The legal representative of a decedent’s estate is deemed a citizen “only
of the same State as the decedent.” 28 U.S.C. § 1332(c)(2).
4. The legal representative of “an infant or incompetent” is deemed a
citizen “only of the same State as the infant or incompetent.” Id.
(2) [§ 3.42] Corporations
A corporation is deemed to be a citizen of both (1) the state by which it
was incorporated and (2) the state in which it has its principal place of
business. 28 U.S.C. § 1332(c)(1). The purpose of allowing for two
possible states of citizenship for corporations is to exclude from federal
jurisdiction those cases in which a corporation is essentially operating in the
same state as the other party, although it is incorporated elsewhere. The
reasoning underlying this exclusion is that such corporations are sufficiently
“local” as to not require protection from possible home-state favoritism in
state courts. Dimmitt & Owens Fin., Inc. v. United States, 787 F.2d 1186,
1190 (7th Cir. 1986).
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' Caveat. There is an exception to the general rule stated above in
the case of liability insurers. In any direct action against an insurer in
which the insured is not joined as a party-defendant, the insurer is
deemed to be a citizen of the state in which the insured is a citizen, as
well as of the state or states in which the insurer is incorporated and the
state in which it has its principal place of business. 28 U.S.C.
§ 1332(c)(1).
For purposes of the diversity jurisdiction statute, 28 U.S.C. § 1332, a
corporation has only one principal place of business. The federal courts
have advanced a number of different tests for determining a corporation’s
principal place of business:
1. The “nerve center” test, Scot Typewriter Co. v. Underwood Corp., 170
F. Supp. 862, 865 (S.D.N.Y. 1959) (placing predominant emphasis on
locus of executive and administrative functions of corporation);
2. The “place-of-activity” test, Kelly v. United States Steel Corp., 284 F.2d
850, 854 (3d Cir. 1960) (placing predominant emphasis on center of
production and service activities); and
3. The “total activity” test, J.A. Olson Co. v. City of Winona, 818 F.2d 401,
404 (5th Cir. 1987) (applying hybrid of nerve center and place-ofactivity test).
' Note. The Seventh Circuit, in which many Wisconsin cases are
decided, uses the nerve center test. Krueger v. Cartwright, 996 F.2d
928, 931 (7th Cir. 1993); Kanzelberger v. Kanzelberger, 782 F.2d 774,
777 (7th Cir. 1986).
' Caution. Determining the principal place of business is sometimes
difficult, but on occasion it can be crucial. A mistake in identifying a
corporation’s principal place of business may mean that there is not
complete diversity of citizenship between the parties, thus depriving the
federal court of subject matter jurisdiction, even after a trial has been
concluded.
' Note. Professional or service corporations are treated the same as
regular business corporations. Saecker v. Thorie, 234 F.3d 1010, 1012
(7th Cir. 2000). In the case of partnerships, limited partnerships and
limited liability companies, the existence of diversity depends on the
citizenship of the partners. Id. at 1011–12.
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d. [§ 3.43] When Citizenship Is Determined
Whether diversity of citizenship exists is generally determined by the
citizenship of the parties at the time the lawsuit is commenced. FreeportMcMoRan, Inc. v. K N Energy, Inc., 498 U.S. 426, 428–29 (1991). Thus,
if a party changes domicile after the action is commenced and becomes
domiciled in the same state as an opposing party, there is no effect on
diversity jurisdiction. In re “Agent Orange” Prod. Liab. Litig., 818 F.2d
145, 162 (2d Cir. 1987).
' Caveat. There are two exceptions to the general rule stated above.
First, if an indispensable party is joined after the lawsuit is commenced
and that party is domiciled in the same state as an opposing party, the
court must dismiss the case on the basis of lack of diversity. Moore v.
Ashland Oil, Inc., 901 F.2d 1445, 1448–49 (7th Cir. 1990). Second, if
a lawsuit lacks complete diversity of citizenship at the time it is
commenced but later the dismissal of nondiverse parties creates
complete diversity, the case may be removable to federal court under
certain conditions. See infra § 3.53.
Occasionally, a person who is an indispensable party or who should be
a plaintiff to an action refuses to join the action as a plaintiff. Such a person
may be joined by the plaintiff as a party defendant. Fed. R. Civ. P. 19(a).
Courts will “realign” such parties according to their actual interest in the
lawsuit in determining whether complete diversity is present in the case.
See City of Dawson v. Columbia Ave. Saving Fund, Safe Deposit, Title &
Trust Co., 197 U.S. 178, 180 (1905).
e. [§ 3.44] Jurisdictional Amount Requirement
In addition to complete diversity of citizenship, see supra § 3.39,
diversity jurisdiction requires that the amount in controversy exceed “the
sum or value of $75,000, exclusive of interest and costs.” 28 U.S.C.
§ 1332(a). In the usual case, this requirement is met by the plaintiff’s
allegation that his or her damages reach the jurisdictional amount, provided
the allegation is made in good faith. St. Paul Mercury Indem. Co. v. Red
Cab Co., 303 U.S. 283, 288 (1938). However, if the defendant can
demonstrate to a “legal certainty” that an amount exceeding $75,000 cannot
be recovered, the court should dismiss the case for want of subject matter
jurisdiction or remand the case to state court if the case was removed. Id.
at 289. A court may allow discovery relating to the plaintiff’s claimed
damages under some circumstances. LaSusa v. Lake Michigan Trans-Lake
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Shortcut, Inc., 113 F. Supp. 2d 1306, 1310 (E.D. Wis. 2000). Further, a
plaintiff may waive his or her right to seek more than $75,000. Jeffery v.
Cross Country Bank, 131 F. Supp. 2d 1067, 1069 (E.D. Wis. 2001).
If the amount in controversy exceeds the jurisdictional amount when a
suit is filed, the fact that subsequent events reduce the total amount in
controversy will not divest the court of jurisdiction. Grinnell Mut. Reins.
Co. v. Shierk, 121 F.3d 1114, 1116 (7th Cir. 1997).
Litigants may prevent removal by filing a binding document stating that
they will not seek more than the minimum jurisdictional amount, as long as
they do so prior to removal. Jeffery, 131 F. Supp. 2d at 1069. If both actual
and punitive damages are recoverable under a complaint, each must be
considered in determining the jurisdictional amount. West Bend Elevator,
Inc. v. Rhone-Poulenc, S.A., 140 F. Supp. 2d 963, 966 (E.D. Wis. 2000).
However, when a claim for punitive damages makes up the bulk of the
amount, the claim must be scrutinized closely. Id. Further, a plaintiff
cannot meet the jurisdictional amount requirement by relying on a future
award of attorney fees. Meyers v. Bayer AG, 143 F. Supp. 2d 1044, 1050
(E.D. Wis. 2001).
The rules for determining whether the amount in controversy reaches the
jurisdictional amount vary depending on the number of parties and claims.
The following checklist sets forth those rules.
T
Checklist:
Rules for Calculating Amount in Controversy
G A single plaintiff alleging multiple claims against a single
defendant: All of the plaintiff’s claims may be aggregated to
reach the jurisdictional amount, even if the claims are not
transactionally related. See, e.g., Jones Motor Co. v. Teledyne, Inc., 690 F. Supp. 310, 317 (D. Del. 1988).
G A single plaintiff alleging “separate and distinct” claims
against multiple defendants: The plaintiff may not aggregate
the claims to satisfy the jurisdictional amount. See Crouch v.
Atlas Van Lines, Inc., 834 F. Supp. 596, 604 (N.D.N.Y. 1993).
G Two plaintiffs alleging “separate and distinct” claims against
a single defendant: The plaintiffs may not aggregate their
claims to reach the jurisdictional threshold, no matter how
transactionally related the claims are. See, e.g., Griffith v.
Sealtite Corp., 903 F.2d 495, 496 (7th Cir. 1990).
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G Two plaintiffs alleging claims based on “common undivided
interests” in property against a single defendant: The
plaintiffs may aggregate their claims to reach the jurisdictional
amount. Id.
G Class action suit: In the past, each class member was required
to have a claim that met the jurisdictional amount, see Zahn v.
International Paper Co., 414 U.S. 291, 301 (1973), though a
class action would be dismissed only if it could be said, to a
legal certainty, that the unnamed plaintiff could recover less
than the jurisdictional amount. In re A.H. Robins Co., 880
F.2d 709, 723 (4th Cir. 1989). Now some courts, including
the Seventh Circuit, have held that the adoption of 28 U.S.C.
§ 1367 in 1990 effectively overruled Zahn by stating that
federal courts have supplemental jurisdiction over all claims
that form part of the same case or controversy and that such
supplemental jurisdiction includes claims that involve the
joinder and intervention of additional parties. See 28 U.S.C.
§ 1367(a); see also In re Abbott Labs., 51 F.3d 524, 527–29
(5th Cir. 1995). While acknowledging that the legislative
history of 28 U.S.C. § 1367 indicates no intent to affect the
jurisdictional requirements of diversity cases, the Seventh
Circuit pointed out that the text of the statute itself is clear.
Stromberg Metal Works, Inc. v. Press Mech., Inc., 77 F.3d
928, 931 (7th Cir. 1996); see also H.R. Rep. No. 734, 101st
Cong., 2d Sess. 1 (1990), reprinted in 1990 U.S.C.C.A.N. at
6860, 6875.
D. [§ 3.45] Indian Tribe Jurisdiction
A state’s jurisdiction may be limited on Indian tribal land within the
state. In assessing whether a state has jurisdiction on tribal land, a court
must consider (1) whether federal law preempts the exercise of state
jurisdiction; and (2) whether—balancing the interest of the states, tribes,
and federal government—the exercise of state jurisdiction would infringe
on the rights of the tribe. State v. Big John, 146 Wis. 2d 741, 749, 432
N.W.2d 576, 580 (1988); Landreman v. Martin, 191 Wis. 2d 787, 794, 530
N.W.2d 62 (Ct. App. 1995). The inquiry is to proceed in light of traditional
notions of Indian sovereignty and the congressional goal of encouraging
tribal self-sufficiency and economic development. Big John, 146 Wis. 2d
at 748; St. Germaine v. Chapman, 178 Wis. 2d 869, 871, 505 N.W.2d 450
(Ct. App. 1993). Other questions regarding the allocation of jurisdiction
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between states and Indian tribes have also arisen. For example, an Indian
tribe may have civil authority over the conduct of nontribal members on
nontribal land within a reservation in certain limited circumstances. See
Strate v. A-1 Contractors, 520 U.S. 438, 445 (1997). However, a tribal
court does not have jurisdiction to adjudicate allegedly tortious conduct in
executing a search warrant on reservation land for an off-reservation crime.
Nevada v. Hicks, 533 U.S. 353, 357–65 (2001).
By statute, the judicial records, orders, and judgments of an Indian tribal
court in Wisconsin must be given the same full faith and credit as those of
any other governmental entity if all of the following conditions are met:
1. The tribe that creates the tribal court and tribal legislative body is
organized under 25 U.S.C. §§ 461–479.
2. The tribal documents are authenticated.
3. The tribal court is a court of record.
4. The tribal court judgment offered in evidence is a valid judgment.
5. The tribal court certifies that it grants full faith and credit to the judicial
records, orders, and judgments of the Wisconsin courts and to the acts
of other governmental entities in Wisconsin.
Wis. Stat. § 806.245(1); see Teague v. Bad River Band of the Lake Superior
Tribe of Chippewa Indians, 2000 WI 79, ¶ 18, 236 Wis. 2d 384, 612
N.W.2d 709. The statute does not address the validity of a tribal court
judgment rendered while an earlier filed state court action on the same
subject matter is pending. In such a case, the doctrine of comity requires
the courts to exercise discretion in the allocation of jurisdiction. Teague,
2000 WI 79, ¶ 35, 236 Wis. 2d 384.
' Comment. In the absence of this statute, principles of tribal
sovereignty would probably necessitate the same result.
Issues of Indian tribe jurisdiction are complicated and beyond the scope
of this chapter. For a comprehensive discussion of tribal sovereignty and
jurisdiction, see John W. Gillingham, Pathfinder: Tribal, Federal, and
State Court Subject Matter Jurisdiction Bounds: Suits Involving Native
American Interests, 18 Am. Indian L. Rev. 73 (1993), and Sandra Hansen,
Survey of Civil Jurisdiction in Indian Country 1990, 16 Am. Indian L. Rev.
319 (1991).
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E. [§ 3.46] Relationship Between State and Federal
Subject Matter Jurisdiction
1. [§ 3.47] State General Jurisdiction Compared to
Federal Limited Jurisdiction
State trial courts are courts of general jurisdiction. They are presumed
to have subject matter jurisdiction over a particular controversy unless some
contrary showing is made. Duel v. Ramar Baking Co., 246 Wis. 604, 608,
18 N.W.2d 345 (1945). Federal district courts, on the other hand, are courts
of limited jurisdiction, with power to hear only cases that are both within
the judicial power of the United States, as defined in the Constitution, and
statutorily entrusted to them by Congress. Sheldon v. Sill, 49 U.S. 441,
448–49 (1850). Federal courts are presumed to be without subject matter
jurisdiction in a particular cause, and therefore the basis for federal subject
matter jurisdiction must be set out in a “short and plain statement of the
grounds upon which the court’s jurisdiction depends.” Fed. R. Civ. P.
8(a)(1).
2. [§ 3.48] Areas of Exclusive Federal Jurisdiction
Federal law confers certain rights that are binding on state courts under
the supremacy clause of the U.S. Constitution, U.S. Const. art. VI.
However, Congress may choose to limit the jurisdiction over certain federal
rights to the federal courts. It may do so explicitly or implicitly. See Gulf
Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 478 (1981). Federal
preemption of a matter deprives a state court of subject matter jurisdiction.
Miller Brewing Co. v. DILHR, 203 Wis. 2d 380, 386, 553 N.W.2d 837 (Ct.
App. 1996), aff’d, 210 Wis. 2d 26, 563 N.W.2d 460 (1997).
The following checklist sets forth some of the civil law areas over which
the federal courts exercise exclusive jurisdiction.
T
Checklist:
Some Areas of Exclusive Federal Jurisdiction
1. Explicit grant of exclusive jurisdiction:
G Bankruptcy matters and proceedings, 28 U.S.C. § 1334.
G Patent and copyright matters, 28 U.S.C. § 1338(a).
G Federal Tort Claim Act cases, 28 U.S.C. § 1346(b).
G Maritime prize cases, 28 U.S.C. § 1333(2).
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G Actions to recover a fine, penalty, or forfeiture under
federal law, 28 U.S.C. § 1355.
G Certain ERISA violations, 29 U.S.C. § 1132(e)(1).
G Certain antitrust actions, 15 U.S.C. §§ 15, 26.
2. Implicit grant of exclusive jurisdiction:
G Actions in which the United States is a defendant, 28
U.S.C. § 1346.
Note that while federal courts have exclusive jurisdiction over
bankruptcy matters, a state court has the jurisdiction to determine whether
an action pending before it is subject to a stay under the Bankruptcy Code.
GMAC Mortgage Corp. v. Gisvold, 215 Wis. 2d 459, 471, 572 N.W.2d 466
(1998).
3. [§ 3.49] Federal Supplemental Jurisdiction
Sometimes claims that are clearly within the subject matter jurisdiction
of the federal district courts are joined in one lawsuit with other claims that
are clearly state law claims with no independent basis for coming within
federal subject matter jurisdiction. 28 U.S.C. § 1367 addresses when a
federal district court may exercise jurisdiction to hear and determine the
state law claims joined with claims within the federal subject matter
jurisdiction. 28 U.S.C. § 1367 is a relatively recent codification of the
common law doctrines of federal pendent and ancillary jurisdiction, now
termed supplemental jurisdiction.
Federal pendent and ancillary jurisdiction are beyond the scope of this
volume. For an excellent resource on these federal jurisdiction issues, see
13 &13B Federal Practice and Procedure, supra § 3.38, at §§ 3523, 3567–
3567.2.
4. [§ 3.50] Concurrent Jurisdiction
a. [§ 3.51] Concurrent Federal and State
Jurisdiction
Under the “prior action pending” rule, when the courts of two separate
sovereigns both have jurisdiction over the same litigation, the first court to
assume jurisdiction is generally entitled to have the judgment receive full
faith and credit by the other jurisdiction. Syver v. Hahn, 6 Wis. 2d 154,
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159–60, 94 N.W.2d 161 (1959). But see Teague, 2000 WI 79, ¶ 2, 236 Wis.
2d 384 (refusing to apply the prior action pending rule to Indian tribal
court). Further, with limited exceptions, the “Rooker-Feldman” doctrine
prohibits lower federal courts from reviewing state court judgments.
Wikberg v. Moore N. Am., Inc., No. 00-2007, 2000 WL 1521768, *2 (7th
Cir. Oct. 6, 2000) (unpublished).
' Note. The Rooker-Feldman doctrine applies not only to claims that
were actually raised before the state court, but also to claims that are
inextricably intertwined with state court determinations. Johnson v.
Collins, No. 99-2950, 2001 WL 195027, *4 (7th Cir. Feb. 23, 2001)
(unpublished). The key inquiry is whether the federal court is in essence
being called upon to review the state court decision. Id.
Most cases within the federal question jurisdiction of federal district
courts, and all cases within the diversity jurisdiction of the federal district
courts, are also within the subject matter jurisdiction of state trial courts.
Furthermore, more than one state may have jurisdiction over a case. When
concurrent jurisdiction exists, there may be opportunities to “forum-shop”
with respect to a particular action. See Davis v. American Family Mut. Ins.
Co., 212 Wis. 2d 382, 389–90, 569 N.W.2d 64 (Ct. App. 1997).
' Example. When the state and federal courts have concurrent
jurisdiction over an action, the plaintiff initially decides whether it is
preferable to have the case heard in state or federal court. If the plaintiff
chooses to file the case in state court, the defendant then must decide
whether it would be advantageous to have the case removed to the
federal court system under the guidelines specified in the removal
statutes, see 28 U.S.C. §§ 1441–1452. If the defendant is successful in
removing the case to federal court, the plaintiff may challenge federal
subject matter jurisdiction and seek the remand to state court of some or
all of the claims. For further discussion of removal of state actions to
federal district courts, see section 3.53, infra. For a checklist of factors
to consider in filing suit in state or federal court, or removing an action
from state to federal court, see section 3.8, supra.
A state court may entertain an action even though it is based entirely on
federal law unless Congress has made federal jurisdiction exclusive. See
supra § 3.48. State courts should start with the presumption of jurisdiction
concurrent with that of the federal courts. Gulf Offshore Co., 453 U.S. at
478. The presumption can be rebutted by explicit statutory directive,
unmistakable implication from legislative history, or clear incompatibility
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between state court jurisdiction and federal interests. Id.; see also Lindas
v. Cady, 150 Wis. 2d 421, 426, 441 N.W.2d 705 (1989).
Moreover, there is no impediment under the Wisconsin Constitution or
the Wisconsin Statutes to Wisconsin courts hearing cases arising under the
laws of other states. In fact, under the full faith and credit clause of the U.S.
Constitution, U.S. Const. art. IV, § 1, a Wisconsin state court may be under
a duty to hear such cases. In Hughes v. Fetter, 341 U.S. 609, 611–13
(1951), the Supreme Court held that the full faith and credit clause
precluded Wisconsin from closing its courts to suit under the Illinois
wrongful death statute in the absence of a valid Wisconsin state policy
outweighing the national interest in the availability of a Wisconsin forum
for such claims.
' Note. Hughes has not been interpreted to prevent a state from
applying its own laws governing the conduct of litigation in its courts.
Thus, a state may apply its own statute of limitation to bar a suit even if
the suit would be timely under the law of the state under which the
action arose. See Wells v. Simonds Abrasive Co., 345 U.S. 514, 516–17
(1953). Wisconsin bars actions brought in the state on a foreign cause
of action if either the applicable Wisconsin period of limitation or the
applicable foreign period of limitation has expired. See Wis. Stat.
§ 893.07; see also supra § 2.59. However, in certain cases Wisconsin’s
procedural requirements may be preempted by a federal right. See
Felder v. Casey, 487 U.S. 131, 134 (1988) (42 U.S.C. § 1983 preempted
application of Wisconsin’s notice-of-claim statute in Wisconsin court).
b. [§ 3.52] Types of Concurrent Jurisdiction Cases
The following checklist includes some of the more significant federal
rights and causes of action over which state courts have jurisdiction
concurrent with that of the federal courts.
T
Checklist:
Actions Subject to Concurrent Jurisdiction
G Actions challenging the constitutionality of state statutes.
G Civil rights actions under 42 U.S.C. § 1983.
G Actions under the Securities Act of 1933, 15 U.S.C. §§ 77a–
77z.
G Civil actions under the Racketeer Influenced and Corrupt
Organizations Act (RICO), 18 U.S.C. §§ 1961–1968.
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G Actions under the Federal Employers’ Liability Act (FELA),
45 U.S.C. § 56.
G Actions under the Voting Rights Act, 42 U.S.C. §§ 1973–
1973p.
G Actions in which more than one state has jurisdiction over the
subject matter and the parties.
5. [§ 3.53] Removal of State Actions to Federal
District Courts
Certain actions initially filed in state court may be removed to federal
court if the federal district court has concurrent jurisdiction. See supra
§§ 3.50–.52. For a checklist of some of the tactical and strategic factors that
must be considered in deciding whether to remove a case from state to
federal court, see section 3.8, supra.
The removal statutes are codified at 28 U.S.C. §§ 1441–1452. A few
basic rules applying to federal removal jurisdiction should be noted:
1. Timing—in general. The time frame for filing a notice of removal is
short. The notice must be filed within 30 days after the defendant
receives “through service or otherwise . . . a copy of the initial pleading
setting forth the claim for relief” that is within the original jurisdiction
of the federal district courts. 28 U.S.C. § 1446(b). The contents of the
notice and the required attachments are described at 28 U.S.C.
§ 1446(a).
' Caution. Some cases have held that, even in the absence of
actual service, the mailing of informal “courtesy” copies of pleadings
to an attorney who purports to represent a named or putative
defendant constitutes “receipt . . . otherwise . . . of the . . . pleading,”
triggering the 30-day time limit for removal. See, e.g., North Jersey
Sav. & Loan Ass’n v. Fidelity & Deposit Co., 125 F.R.D. 96, 100
(D.N.J. 1988).
2. Timing—effect of amendment to pleadings. A state court case that was
not removable initially may become removable because of an amendment to the claims or a change in the parties. For example, a federal
claim may be added that was not in the original case, or a nondiverse
plaintiff or defendant may be dropped. When a case becomes removable
by such an amendment or change in the parties, the 30-day time limit for
filing the notice of removal begins when the defendant receives the
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amended pleading, motion, order, or other paper that first shows the case
has become removable. 28 U.S.C. § 1446(b). If the basis for removal
is that the case now meets the diversity requirement, an additional time
limit is imposed: such cases may be removed after amendment only if
the notice of removal is filed within one year of the original commencement of the action. Id.
3. Parties joining in removal. When an action in which removal is being
contemplated involves multiple defendants, all the defendants must join
in the notice of removal. See, e.g., In re Amoco Petroleum Additives
Co., 964 F.2d 706, 711 (7th Cir. 1992).
4. Federal district court venue. An action that is removed from state to
federal court will be removed to the federal district court for the federal
district and division encompassing the county where the state court
action was pending. 28 U.S.C. §§ 1441(a), 1446(a).
5. Defendant citizenship. An action may not be removed from state to
federal court if any one of the defendants, properly joined as a defendant, is a citizen of the state in which the state action is pending and the
only basis for federal subject matter jurisdiction is diversity of citizenship under 28 U.S.C. § 1332. If, however, the plaintiff’s claims also
present a federal question, the parties’ citizenship or residence is not
significant. 28 U.S.C. § 1441(b).
6. Remand. When a case is removed, the plaintiff has the right to
challenge whether the case was properly removed to federal court and
to seek remand of the case to the state court. Furthermore, when claims
within federal court jurisdiction are removed along with companion
claims that raise only state law issues, the federal court may, in its
discretion, remand the state law claims to the state court, leaving two
actions pending between the parties. 28 U.S.C. § 1441(c).
7. Supplemental claims. State law claims that derive from a common
nucleus of operative fact with federal law claims may be removed along
with the federal claims because the federal court will have supplementary jurisdiction over those claims. City of Chicago v. International
College of Surgeons, 522 U.S. 156, 164–65 (1997); see also Cardenas
v. Fire & Police Comm’n, 990 F. Supp. 645, 646 (E.D. Wis. 1998).
8. Claims barred by the 11th Amendment. The 11th Amendment doctrine
of sovereign immunity may bar certain claims brought in federal court.
However, the presence of a claim barred by the 11th Amendment does
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not prevent a federal court from hearing any other claims in the case (or
from hearing the barred claim if the 11th Amendment is waived).
Wisconsin Dep’t of Corrections v. Schacht, 524 U.S. 381, 389 (1998).
9. Collateral attack on federal subject matter jurisdiction. Generally,
when a party has had an opportunity to litigate the question of subject
matter jurisdiction, that party may not reopen the question in a collateral
attack following an adverse judgment. U.S. v. Tittjung, 235 F.3d 330,
335 (7th Cir. 2000), cert. denied, 121 S. Ct. 2554 (2002). However,
Fed. R. Civ. P. 60(b)(4) provides an exception to the general rule when
the jurisdictional error is “egregious.” Id. To be egregious, and thus
void under Rule 60(b)(4), the error must involve a clear usurpation of
judicial power, meaning that the court wrongfully extended its jurisdiction beyond the scope of its authority. Id.
IV. [§ 3.54] Personal Jurisdiction
A. [§ 3.55] In General
The personal jurisdiction of a court is its power to adjudicate a case
involving the particular defendant in the case. The plaintiff, having
voluntarily invoked the court’s power by filing suit, has submitted to the
court’s jurisdiction. The defendant, on the other hand, is coming to court
under compulsion, almost always reluctantly. Whether a court has personal
jurisdiction over a defendant determines the extent of the court’s power to
compel the defendant to come to that court to defend the lawsuit.
Personal jurisdiction issues originally arose out of a perceived need to
limit the judicial power of state courts. A state court’s exercise of
jurisdiction over persons or property in another state was seen as threatening state sovereignty. On the other hand, the full faith and credit clause of
the United States Constitution, U.S. Const. art. IV, § 1, required all states
to recognize a judgment rendered against a party by a state considered to
have jurisdiction over the party.
The United States Supreme Court attempted to resolve the inconsistency
between the doctrine of state sovereignty and the dictate of the full faith and
credit clause in the landmark case of Pennoyer v. Neff, 95 U.S. 714, 727–28
(1878), holding that due process required the defendant to be “present”
within a state when served with process in order for the courts of that state
to exercise personal jurisdiction over the defendant. Over the years, the
Pennoyer presence requirement evolved into the modern day requirement
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that a defendant have certain “minimum contacts” with the forum state, and
that the exercise of jurisdiction comport with traditional notions of fair play
and substantial justice, in order for that state to exercise personal jurisdiction over the defendant. See infra § 3.61.
' Note. In the case of federal courts, in diversity cases a federal court
has personal jurisdiction over the parties only if a court in the state in
which the federal court sits would have such jurisdiction. PKWare, Inc.
v. Meade, 79 F. Supp. 2d 1007, 1011 (E.D. Wis. 2000). In federal
question cases, whether a federal court has personal jurisdiction depends
on whether defendants are amenable to process from that federal court.
Id.
B. [§ 3.56] General vs. Specific Personal Jurisdiction
In analyzing issues of personal jurisdiction, it is helpful to distinguish
between general personal jurisdiction and specific personal jurisdiction.
This distinction is also important to an understanding of the Wisconsin
long-arm statute, see infra § 3.63.
A court is said to be exercising specific jurisdiction over a defendant
when it exercises personal jurisdiction over the defendant in a suit “arising
out of or related to the defendant’s contacts with the forum.” Helicopteros
Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n.8 (1984). A
simple example is a suit against a nonresident motorist who causes injury
by negligent driving while traveling through the forum state. Another
example is an action for rescission of the purchase of a security brought
against a nonresident securities dealer who came into the forum state to
promote only the single sale at issue.
A court is said to be exercising general jurisdiction over a defendant
when it exercises personal jurisdiction over the defendant in a suit that
neither arises out of nor is related to the defendant’s contacts with the forum
state. Id. at 415 n.9. An example is an action in which a Minnesota
resident sues a Wisconsin resident in Wisconsin for an automobile accident
that occurred in Minnesota, in an effort to benefit from some favorable
Wisconsin substantive or procedural law.
To meet the requirements for specific personal jurisdiction, the
connections or contacts between the forum state and the particular
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dant’s contacts with the forum state. The justifiable exercise of general
personal jurisdiction, on the other hand, requires significant, systematic, and
continuous contacts or connections between the defendant and the forum
state. See, e.g., Helicopteros Nacionales de Colombia, S.A. v. Hall, 466
U.S. 408, 415–16 (1984); Perkins v. Benguet Consol. Mining Co., 342 U.S.
437, 446 (1952).
C. [§ 3.57] Determination of Whether Court Has
Personal Jurisdiction
1. [§ 3.58] In General
Determining whether a Wisconsin court has jurisdiction over a
defendant requires three steps:
1. Determining whether the defendant was properly served with a
summons, see infra § 3.59;
2. Determining whether the defendant’s contacts with Wisconsin subject
the defendant to jurisdiction under a Wisconsin long-arm statute, see
infra §§ 3.60, .62–.85; and
3. Determining whether the exercise of jurisdiction under the long-arm
statute comports with due process, Dietrich v. Patients Comp. Fund, 169
Wis. 2d 471, 478, 485 N.W.2d 614 (Ct. App. 1992); Wis. Stat.
§ 801.04(2); see infra § 3.61.
' Note. A plaintiff is not required to establish personal jurisdiction
on a threshold basis. The plaintiff has the burden to establish jurisdiction only after a defendant raises a jurisdictional objection. Mendez v.
Hernandez-Mendez, 213 Wis. 2d 217, 226, 570 N.W.2d 563 (Ct. App.
1997).
2. [§ 3.59] Service of Process
Proper service of process is an essential requirement for personal
jurisdiction, whether general or specific. See Mendez v. HernandezMendez, 213 Wis. 2d 217, 224, 570 N.W.2d 563 (Ct. App. 1997); CH2M
Hill, Inc. v. Black & Veatch, 206 Wis. 2d 370, 375, 557 N.W.2d 829 (Ct.
App. 1996); Honeycrest Farms, Inc. v. Brave Harvestore Sys., Inc., 200
Wis. 2d 256, 262, 546 N.W.2d 192 (Ct. App. 1996) (proper service relates
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arm statute only confers personal jurisdiction over “a person served in an
action pursuant to [section] 801.11.” Wis. Stat. § 801.05.
Some defects in service are fundamental and deprive the court of
personal jurisdiction regardless of actual prejudice. Burnett v. Hill, 207
Wis. 2d 110, 122, 557 N.W.2d 800 (1997); Gaddis v. La Crosse Prods.,
Inc., 198 Wis. 2d 396, 401–02, 542 N.W.2d 454 (1996). Other defects are
merely technical and will not deprive a court of personal jurisdiction absent
prejudice. Gaddis, 198 Wis. 2d at 401–02. For example, service by an outof-state process server is a fundamental defect that deprives the court of
personal jurisdiction. Bendimez v. Neidermire, 222 Wis. 2d 356, 357, 588
N.W.2d 55 (Ct. App. 1998). Signing a pleading using a stamped reproduction of a signature is a fundamental defect. Schaefer v. Riegelman, 2002 WI
18, ¶ 33, 250 Wis. 2d 494, 639 N.W.2d 715, overruling Novak v. Phillips,
2001 WI App 156, ¶ 2, 246 Wis. 2d 673, 631 N.W.2d 635. Likewise,
pleadings signed by a nonattorney at the request of an attorney are
fundamentally defective. Schaefer, 2002 WI 18, ¶¶ 1–3, 250 Wis. 2d 494.
' Caveat. A court with subject matter jurisdiction may exercise
personal jurisdiction over a person without service of process (1) with
respect to any counterclaim asserted against the person in an action the
person has commenced in Wisconsin; or (2) if the person appears in an
action and waives the defense of lack of personal jurisdiction, see infra
§ 3.90. Wis. Stat. § 801.06.
' Note. A person will not be subject to personal jurisdiction if he or
she is fraudulently tricked into coming into the state, then is served.
Townsend v. Smith, 47 Wis. 623, 626, 3 N.W. 439 (1879). However, a
defendant may be legitimately served when he or she voluntarily comes
to the state for settlement negotiations. See Manitowoc W. Co. v.
Montonen, 2002 WI 21, ¶ 32, 250 Wis. 2d 452, 639 N.W.2d 726.
Service of process is discussed in detail in Chapter 6, infra.
3. [§ 3.60] Statutory Basis
The exercise of personal jurisdiction by Wisconsin courts is governed
by section 801.05, Wisconsin’s long-arm statute. Regal Ware, Inc. v. TSCO
Corp., 207 Wis. 2d 538, 542, 558 N.W.2d 679 (Ct. App. 1996). Section
801.05 sets out the grounds for a Wisconsin court to assert personal
jurisdiction over a defendant, third-party defendant, or cross-claim
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defendant, provided that the court also has jurisdiction over the subject
matter.
The Wisconsin long-arm statute represents an attempt to codify the
minimum contacts test for personal jurisdiction that complies with due
process. See infra § 3.61. Compliance with the language of section 801.05
thus raises a presumption of compliance with due process. Lincoln v.
Seawright, 104 Wis. 2d 4, 10, 310 N.W.2d 596 (1981). However, the
defendant may rebut this presumption by showing that, as to the particular
jurisdictional facts involved in the case, personal jurisdiction over the
defendant would violate due process. Marsh v. Farm Bureau Mut. Ins. Co.,
179 Wis. 2d 42, 53, 505 N.W.2d 162 (Ct. App. 1993).
The Wisconsin Supreme Court has consistently stated that the Wisconsin
long-arm statute is intended to provide for the exercise of jurisdiction over
nonresident defendants “to the full extent consistent with the requisites of
due process of law.” Flambeau Plastics Corp. v. King Bee Mfg. Co., 24
Wis. 2d 459, 464, 129 N.W.2d 237 (1964); Zerbel v. H.L. Federman & Co.,
48 Wis. 2d 54, 59–60, 179 N.W.2d 872 (1970). The Wisconsin long-arm
statute is thus to be liberally construed in favor of exercising jurisdiction.
Dietrich v. Patients Comp. Fund, 169 Wis. 2d 471, 478, 485 N.W.2d 614
(Ct. App. 1992). The requirements for exercising jurisdiction under
Wisconsin law have been characterized as “very slight.” Thill Sec. Corp.
v. New York Stock Exch., 283 F. Supp. 239, 244 (E.D. Wis. 1968), rev’d on
other grounds, 433 F.2d 264 (7th Cir. 1970). For example, the court is not
limited to facts that are directly proven; it may also draw inferences from
the facts. Stevens v. White Motor Corp., 77 Wis. 2d 64, 75, 252 N.W.2d 88
(1977).
Whether a particular defendant may be reached by the long-arm statute
consistent with due process under the 14th Amendment is an issue of
federal constitutional law as to which the state courts are bound by United
States Supreme Court precedent. State v. Webster, 114 Wis. 2d 418, 426
n.4, 338 N.W.2d 474 (1983); McKnight v. General Motors Co., 157 Wis.
2d 250, 257, 458 N.W.2d 841 (Ct. App. 1990). Due process requirements
for the exercise of personal jurisdiction by Wisconsin courts are discussed
in section 3.61, infra.
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4. [§ 3.61] Due Process
As noted in section 3.58, supra, the right of a Wisconsin court to
exercise personal jurisdiction over a particular defendant is subject to the
requirements of due process under the 14th Amendment. Regal Ware, Inc.
v. TSCO Corp., 207 Wis. 2d 538, 541–42, 558 N.W.2d 679 (Ct. App.
1996). The current test for due process is known as the “minimum contacts
test.”
The minimum contacts test was first articulated by the United States
Supreme Court in International Shoe Co. v. Washington, 326 U.S. 310
(1945). Under International Shoe, a court may exercise personal jurisdiction over a nonresident defendant only if it can establish that the nonresident has “certain minimum contacts” with the state, such that “maintenance
of the suit does not offend ‘traditional notions of fair play and substantial
justice.’” Id. at 316. Following International Shoe, the increase in
interstate commerce resulted in a trend “toward expanding the permissible
scope of state jurisdiction over foreign corporations and other nonresidents.” McGee v. International Life Ins. Co., 355 U.S. 220, 222 (1957).
In order for a court to exercise personal jurisdiction over a nonresident
defendant under the minimum contacts test, the defendant must have
“purposefully avail[ed himself or herself] of the privilege of conducting
activities within [the forum state], thus invoking the benefits and protections
of its laws.” Hanson v. Denckla, 357 U.S. 235, 253 (1958); see also Kulko
v. Superior Court, 436 U.S. 84, 94–95 (1978) (when effects of defendant’s
acts outside forum state occurred within forum state not because of
defendant’s intentions, but because third person independently caused
effects to occur there, jurisdiction could not be upheld). If a contract exists
between the two parties, the court must consider the impact of the contract
on the question of whether a party has purposefully established minimum
contacts with the forum state. Regal Ware, Inc. v. TSCO Corp., 207
Wis. 2d 538, 544, 558 N.W.2d 679 (Ct. App. 1996). All prior negotiations,
contemplated future consequences of the contract, and relevant terms, as
well as the course of dealing between the parties, must be considered. Id.
In addition, the defendant must have been able to “reasonably anticipate
being haled into court” in the forum state. World-Wide Volkswagen Corp.
v. Woodson, 444 U.S. 286, 297 (1980) (commercial defendant would
reasonably foresee being haled into court in foreign state when defendant
delivered products into stream of commerce with expectation that they
would be purchased by consumers in that state); see also Asahi Metal Indus.
Co. v. Superior Court, 480 U.S. 102, 112 (1987) (even when defendant
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places product into stream of commerce with awareness that it may be
swept into forum state, mere placement of product into stream is not an act
“purposefully directed” towards forum state). A defendant may not be
haled into a foreign jurisdiction solely because of random, fortuitous, or
attenuated contacts, or as a result of the unilateral activity of another party
or a third person. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475
(1985). Rather, the contacts between the defendant and the forum state
must have proximately resulted from actions by the defendant that created
a “substantial connection” with the forum state. Id. Recent cases indicate
that minimum contacts can even be established when a defendant has
contact with the state via the Internet. See American Network, Inc. v.
Access Am./Connect Atlanta, Inc., 975 F. Supp. 494, 498–500 (S.D.N.Y.
1997); Hall v. LaRonde, 66 Cal. Rptr. 2d 399, 400 (Ct. App. 1997);
Minnesota v. Granite Gate Resorts, Inc., 568 N.W.2d 715, 718–21 (Minn.
Ct. App. 1997), aff’d, 576 N.W.2d 747 (Minn. 1998).
In determining whether the contacts between a defendant and the forum
state were sufficient, a court is to consider the following factors:
1. The burden on the defendant of having to defend in the forum state;
2. The forum state’s interest in adjudicating the dispute;
3. The plaintiff’s interest in obtaining convenient and effective relief;
4. The interstate judicial system’s interest in obtaining the most efficient
resolution of controversies; and
5. The shared interest of the several states in furthering fundamental
substantive social policies.
Id. at 477.
' Comment. A number of the above convenience factors articulated
in Burger King Corp. were anticipated in a 1970 Wisconsin Supreme
Court case, Zerbel v. H.L. Federman & Co., 48 Wis. 2d 54, 64–65, 179
N.W.2d 872 (1970).
' Note. Some states recognize a “fiduciary shield” doctrine, whereby
an individual is protected from being haled as an individual into court
when all of his or her activities occurred as an agent of another. Hardin
Roller Corp. v. Universal Printing Mach., Inc., 236 F.3d 839, 842 (7th
Cir. 2001). Wisconsin courts have neither applied nor rejected the
doctrine. Id.
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D. [§ 3.62] Wisconsin Long-Arm Statute
1. [§ 3.63] In General
Section 801.05 states the general grounds for personal jurisdiction. It
begins: “A court of this state having jurisdiction over the subject matter has
jurisdiction over a person served in an action pursuant to [section] 801.11
under any of the following circumstances: . . . .” Those circumstances are
set forth in subsections (1)–(11) of the statute. These subsections can be
generally divided into those that provide for general personal jurisdiction
and those that provide for specific personal jurisdiction. See supra § 3.56.
The general jurisdiction subsections are 801.05(1)(a)–(d). See infra
§§ 3.64–.69. Lawsuits brought under these four subsections need not be
based on causes of action arising out of or related to the defendant’s
contacts with Wisconsin. Rather, personal jurisdiction may be established
under (1)(a)–(d) if the defendant has substantial contacts with Wisconsin.
The specific jurisdiction subsections are 801.05(3)–(11). See infra
§§ 3.70–.85. These subsections, by contrast with subsections (1)(a)–(d),
contemplate that the defendant may not have substantial contacts with
Wisconsin, but that the cause of action itself arises out of or is related to
whatever contacts with Wisconsin the defendant has.
In addition, there are several special jurisdictional statutes that specifically confer jurisdiction in certain cases. Those statutes are recognized by
the general long-arm statute in subsection (2). See infra § 3.86.
2. [§ 3.64] General Personal Jurisdiction
a. [§ 3.65] In General
Section 801.05(1) establishes the grounds for general personal jurisdiction in Wisconsin. The section reads:
A court of this state having jurisdiction of the subject matter has jurisdiction
over a person served in an action pursuant to [section] 801.11 under any of the
following circumstances:
(1) LOCAL PRESENCE OR STATUS. In any action whether arising within or
without this state, against a defendant who when the action is commenced:
(a) Is a natural person present within this state when served; or
(b) Is a natural person domiciled within this state; or
(c) Is a domestic corporation or limited liability company; or
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(d) Is engaged in substantial and not isolated activities within this state,
whether such activities are wholly interstate, intrastate, or otherwise.
Sections 3.66–.69, infra, discuss subsections (1)(a)–(d).
b. [§ 3.66] Physical Presence Within State
Subsection 801.05(1)(a) authorizes personal jurisdiction over “a natural
person present within [Wisconsin] when served.” This is the most basic and
traditional ground for personal jurisdiction. See Pennoyer v. Neff, 95 U.S.
714, 727–28 (1878) (recognizing constitutional adequacy of this form of
obtaining personal jurisdiction). However, a due process issue has arisen
in cases under subsection (1)(a) in recent years—namely, whether a
transient nonresident (someone temporarily in the forum state at the time of
personal service) is subject to personal jurisdiction when the person has no
substantial contacts with the state otherwise.
The Wisconsin Supreme Court considered the issue of personal
jurisdiction over transient nonresidents in Oxmans’ Erwin Meat Co. v.
Blacketer, 86 Wis. 2d 683, 273 N.W.2d 285 (1979). The court noted that
it did not believe the United States Supreme Court had ever imposed a
minimum contacts requirement on a state court’s exercise of personal
jurisdiction over a natural person personally served within the forum state.
Id. at 687–88. However, the Wisconsin court determined that it did not
have to decide whether such a requirement existed, since it concluded that
the defendant’s activities within Wisconsin would fulfill any minimum
contacts requirement that might arguably exist. Id. at 688.
The United States Supreme Court took up the issue of personal
jurisdiction over transient nonresidents in 1990. In Burnham v. Superior
Court, 495 U.S. 604, 619 (1990), the Court issued a plurality decision
approving personal jurisdiction obtained over a transient nonresident by
personal service in the forum state, without a showing of minimum
contacts.
' Caveat. Some courts have rejected personal jurisdiction over a
transient nonresident defendant, even when the defendant was personally served in the forum state, if the defendant’s presence in the forum
state was achieved by duress or fraud perpetrated for the purpose of
obtaining the service of process. Jacobs/Kahan & Co. v. Marsh, 740
F.2d 587, 592 n.7 (7th Cir. 1984). Case law and statutes have also
provided qualified immunity from service of process for persons coming
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into a state merely to challenge the jurisdiction of the state’s courts over
them. Stewart v. Ramsay, 242 U.S. 128, 130–31 (1916).
c. [§ 3.67] Wisconsin Domicile
Subsection 801.05(1)(b) authorizes personal jurisdiction over “a natural
person domiciled within this state.” Unlike subsection (1)(a), which
requires the defendant’s presence within the state when served, see supra
§ 3.66, subsection (1)(b) would permit a Wisconsin court to exercise
personal jurisdiction over a person who is outside Wisconsin at the time of
service of process if that person is domiciled in Wisconsin. See supra
§ 3.41 (definition of domicile). The exercise of personal jurisdiction by a
state court over domiciliaries of the state served outside the state was held
permissible in Milliken v. Meyer, 311 U.S. 457, 462–63 (1940). Typically,
the propriety of jurisdiction under subsection (1)(b) will turn on whether the
person had established a new domicile outside Wisconsin before the action
was commenced.
' Note. If a Wisconsin domiciliary is served within Wisconsin in a
Wisconsin action, either subsection (1)(b) or subsection (1)(a) is
sufficient to establish personal jurisdiction.
d. [§ 3.68] Domestic Corporation, Limited
Liability Company, or Limited
Liability Partnership
Subsection 801.05(1)(c) establishes that a Wisconsin court may exercise
jurisdiction over a domestic corporation or limited liability company (LLC).
Such firms are incorporated or established voluntarily under statutory
authority that requires maintenance of an agent within Wisconsin for
acceptance of service of process, among other things. See Wis. Stat.
§§ 180.0501, .0504 (corporations), 183.0105(1), (8) (LLCs); see also Wis.
Stat. § 178.44 (limited liability partnerships).
e. [§ 3.69] Substantial Activities Within State
Subsection 801.05(1)(d) allows a court to exercise general personal
jurisdiction over a defendant who, at the time of the commencement of the
action, is engaged “in substantial and not isolated activities within
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[Wisconsin], whether such activities are wholly interstate, intrastate, or
otherwise.”
This provision is Wisconsin’s codification of the minimum contacts test
for whether a nonresident defendant may be deemed “present” in the state,
see supra § 3.61. The provision focuses solely on the quality and quantity
of the defendant’s contacts with Wisconsin; it does not require that the
plaintiff be a Wisconsin resident or that the cause of action itself arise out
of or be related to the defendant’s activities in Wisconsin. Cf. Perkins v.
Benguet Consol. Mining Co., 342 U.S. 437, 438 (1952) (holding that Ohio
could, consistent with due process, exercise personal jurisdiction over
Philippine corporation engaged in “systematic and continuous business” in
Ohio, even though plaintiff was nonresident of Ohio and cause of action did
not arise out of defendant company’s activities in Ohio). In re Paternity of
Carlin L.S., 226 Wis. 2d 79, 88, 593 N.W.2d 486 (Ct. App. 1999) (holding
that trial court in paternity action lacked personal jurisdiction over alleged
father, whose only contacts with Wisconsin were his attendance at two
funerals for a few hours each); Gogebic-Iron Wastewater Auth. v. C.D.
Smith Constr., Inc., No. 98-2988, 1999 WL 557753, *4–5 (Wis. Ct. App.
July 30, 1999) (unpublished opinion not to be cited as precedent or
authority per section 809.23(3)) (holding that, while business would
normally have sufficient contacts with Wisconsin under section
801.05(1)(d) when it has several Wisconsin clients, such contacts were not
sufficient when there was no evidence that any projects for Wisconsin
clients were performed in Wisconsin or involved any contact by defendant
with Wisconsin).
' Note. Section 801.05(1)(d) is not limited to activities that are
business or employment related. Bushelman v. Bushelman, 2001 WI
App 124, ¶ 15, 246 Wis. 2d 317, 629 N.W.2d 795.
3. [§ 3.70] Specific Personal Jurisdiction
a. [§ 3.71] Local Act or Omission
Under subsection 801.05(3), a Wisconsin court has personal jurisdiction
over a defendant who is responsible for acts or omissions within Wisconsin
that cause injury to persons or property either within or without the state.
The elements required for jurisdiction under this provision are (1) an act or
omission within Wisconsin by the defendant; and (2) a claim of injury to
person or property alleged to arise out of the local act or omission. State v.
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Advance Mktg. Consultants, Inc., 66 Wis. 2d 706, 716, 225 N.W.2d 887
(1975).
For example, Wisconsin courts had jurisdiction over a Minnesota
psychiatrist who (1) was involved in a joint treatment plan being administered in Minnesota and Wisconsin, (2) allegedly negligently supervised
Wisconsin therapy sessions, (3) treated her Wisconsin patient in Wisconsin
at least once, and (4) provided prescriptions to a Wisconsin resident.
Sawyer v. Midelfort, 217 Wis. 2d 795, 811–12, 579 N.W.2d 268 (Ct. App.
1998), aff’d on other grounds, 227 Wis. 2d 124, 595 N.W.2d 423 (1999).
b. [§ 3.72] Local Injury; Foreign Act or Omission
(1) [§ 3.73] In General
Subsection 801.05(4) gives Wisconsin courts jurisdiction over a
defendant who causes injury to persons or property within Wisconsin due
to the defendant’s acts or omissions outside Wisconsin if it can be
demonstrated that, at the time of the injury, the following two conditions
were satisfied:
(a) Solicitation or service activities were carried on within this state by or
on behalf of the defendant; or
(b) Products, materials or things processed, serviced or manufactured by the
defendant were used or consumed within this state in the ordinary course of
trade.
This section of the Wisconsin long-arm statute deals only with tortious
conduct; it is not intended to be used as a basis for personal jurisdiction
over a defendant in a breach-of-contract case. Nagel v. Crain Cutter Co.,
50 Wis. 2d 638, 643, 184 N.W.2d 876 (1971); Towne Realty, Inc. v. Bishop
Enters., Inc., 432 F. Supp. 691, 693 (E.D. Wis. 1977).
It is not sufficient for the purpose of section 801.05(4) that a Wisconsin
resident, as a shareholder of a plaintiff-corporation, indirectly suffers
financial injury due to actions in another state. Gogebic-Iron Wastewater
Auth. v. C.D. Smith Constr., Inc., No. 98-2988, 1999 WL 557753, *5 (Wis.
Ct. App. July 30, 1999) (unpublished opinion not to be cited as precedent
or authority per section 809.23(3)). Rather, a personal injury or property
damage must occur, or there must be a direct financial loss, in Wisconsin.
Id. It is also insufficient if the only “service activities” are connected with
a single, isolated transaction. Housing Horizons, LLC v. Alexander Co.,
2000 WI App 9, ¶¶ 12–14, 232 Wis. 2d 178, 606 N.W.2d 263. In enacting
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section 801.05(4)(a), the legislature contemplated some type of regular,
ongoing, or repetitive activities in Wisconsin as a requirement for establishing personal jurisdiction under that statute. Id. ¶ 14.
(2) [§ 3.74] Standards for Tortious Conduct
Some other jurisdictions have found a single instance of tortious conduct
outside the forum state leading to injury within the forum state sufficient to
sustain personal jurisdiction. See, e.g., Mobil Oil Corp. v. Advanced Envtl.
Recycling Techs., 833 F. Supp. 437, 445 (D. Del. 1993) (citing Eudaily v.
Harmon, 420 A.2d 1175 (Del. 1980)). Moreover, the requirements of due
process would probably be satisfied by a single instance of tortious conduct.
Fields v. Peyer, 75 Wis. 2d 644, 651, 250 N.W.2d 311 (1977). However,
Wisconsin’s long-arm statute has been interpreted to require more. Id.
Subsection 801.05(4)(b) has been read to require that more than one
product, material, or thing processed, serviced, or manufactured by the
defendant be used or consumed in Wisconsin in the ordinary course of
trade. Hasley v. Black, Sivalls & Bryson, Inc., 70 Wis. 2d 562, 579–80, 235
N.W.2d 446 (1975); Davis v. Mercier-Freres, 368 F. Supp. 498, 501 (E.D.
Wis. 1973). However, this requirement has been deemed satisfied in a case
in which an out-of-state defendant sold component replacement and repair
parts to the one purchaser of the defendant’s machine within Wisconsin.
See Schmitz v. Hunter Mach. Co., 89 Wis. 2d 388, 400, 279 N.W.2d 172
(1979). Similarly, subsection 801.05(4)(a) has been read to require that the
defendant’s solicitation or service activities extend beyond the activities
carried out with respect to the product, material, or thing that caused injury
to the plaintiff. See McPhee v. Simonds Saw & Steel Co., 294 F. Supp. 779,
782 (W.D. Wis. 1969).
' Note. A distributor’s purchase and resale of finished goods, when
done in the ordinary course of distribution, have been held to constitute
a processing of the goods sufficient to fall within the statute’s terms.
Nelson v. Park Indus., Inc., 717 F.2d 1120, 1124 (7th Cir. 1983); see
also Kopke v. A. Hartrodt S.R.L, 2001 WI 99, ¶ 17, 245 Wis. 2d 396,
629 N.W.2d 662, cert. denied, 122 S. Ct. 808 (2002) (adopting a broad
definition of “processing”). But see Lesnick v. Hollingsworth & Vose
Co., 35 F.3d 939, 944 (4th Cir. 1994) (suggesting that Nelson interpreted
processing in subsection 801.05(4)(b) too broadly).
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(3) [§ 3.75] Timing
The timing of the required solicitation or service activities or use or
consumption of products is crucial under subsection 801.05(4). Such
activities, use, or consumption must occur “at the time of the injury.” Wis.
Stat. § 801.05(4). The time of the injury will usually be the time of the
accident, LaBonte v. Preyer, 300 F. Supp. 1078, 1080 (E.D. Wis. 1969), but
in cases involving latent injuries, the time of the injury may instead be the
time of the discovery of the injury (by analogy to Wisconsin’s discovery
rule for determining when an action in tort accrues for statute-of-limitation
purposes, see, e.g., Doe v. American Nat’l Red Cross, 176 Wis. 2d 610, 615
& n.4, 500 N.W.2d 264 (1993); see also supra § 2.63).
(4) [§ 3.76] Proof
In actions in which personal jurisdiction is sought under subsection
801.05(4), it is desirable to develop direct proof that multiple products of
the out-of-state defendant were, in the ordinary course of trade, used or
consumed in Wisconsin. See, e.g., Hasley, 70 Wis. 2d at 580–81.
However, the Wisconsin Supreme Court has recognized that multiple use
or consumption can, in the proper case, be established by proper inference
from other evidence in the record. Stevens, 77 Wis. 2d at 73.
c. [§ 3.77] Local Services, Goods, or Contracts
Subsection 801.05(5) permits Wisconsin courts to exercise personal
jurisdiction over a defendant in any action that:
(a) Arises out of a promise, made anywhere to the plaintiff or to some 3rd
party for the plaintiff’s benefit, by the defendant to perform services within this
state or to pay for services to be performed in this state by the plaintiff; or
(b) Arises out of services actually performed for the plaintiff by the
defendant within this state, or services actually performed for the defendant by
the plaintiff within this state if such performance within this state was authorized or ratified by the defendant; or
(c) Arises out of a promise, made anywhere to the plaintiff or to some 3rd
party for the plaintiff’s benefit, by the defendant to deliver or receive within this
state or to ship from this state goods, documents of title, or other things of
value; or
(d) Relates to goods, documents of title, or other things of value shipped
from this state by the plaintiff to the defendant on the defendant’s order or
direction; or
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(e) Relates to goods, documents of title, or other things of value actually
received by the plaintiff in this state from the defendant without regard to where
delivery to carrier occurred.
This subsection of the Wisconsin long-arm statute focuses on the
relationship of the particular transaction to the state of Wisconsin, rather
than on the defendant’s relationship to the state. Afram v. Balfour,
Maclaine, Inc., 63 Wis. 2d 702, 709, 218 N.W.2d 288 (1974) (decided
under predecessor statute, Wis. Stat. § 262.05(5)).
Subsections 801.05(5)(a) and (b) deal with contracts or arrangements for
the performance of services within Wisconsin by either party for the other.
The performance of the services within Wisconsin must either (1) be
promised at the time of contracting, Wis. Stat. § 801.05(5)(a), or (2) be
authorized or ratified by the defendant after contracting and after the
services have actually been performed, Wis. Stat. § 801.05(5)(b). The
longstanding nature of a contract between the parties may be evidence of
authorization or ratification. Regal Ware, Inc. v. TSCO Corp., 207 Wis. 2d
538, 543, 558 N.W.2d 679 (Ct. App. 1996).
' Example. In a case in which the contract at issue specifically called
for architectural services to be substantially performed in Milwaukee,
the terms of the long-arm statute were met. Py-Vavra, ArchitectsEng’rs, Inc. v. Gilpin, 64 F.R.D. 693, 693–94 (E.D. Wis. 1974). On the
other hand, the statutory terms presumably would not be satisfied if a
California defendant contracted with a national engineering firm to do
a feasibility study, which the national engineering firm subcontracted
out to its Milwaukee office without the defendant’s authorization or
ratification.
' Example. In a dispute between a Wisconsin cookware manufacturer and a broker/distributor, section 801.05(5)(b) conferred personal
jurisdiction over the broker/distributor because the manufacturer
(1) manufactured and shipped cookware in Wisconsin, (2) approved
sales orders submitted by the broker/distributor to the Wisconsin
manufacturer, and (3) sent the broker/distributor commission checks
drawn on a Wisconsin bank. Regal Ware, Inc. v. TSCO Corp., 207
Wis. 2d 538, 543, 558 N.W.2d 679 (Ct. App. 1996).
Subsections 801.05(5)(c), (d), and (e) deal with the shipment of goods,
title, or other valuables, or promises for the shipment of such goods, title,
or valuables.
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d. [§ 3.78] Local Property
Subsection 801.05(6) provides that a Wisconsin court may exercise
personal jurisdiction over a defendant in any action that arises out of:
(a) A promise, made anywhere to the plaintiff or to some 3rd party for the
plaintiff’s benefit, by the defendant to create in either party an interest in, or
protect, acquire, dispose of, use, rent, own, control or possess by either party
real property situated in this state; or
(b) A claim to recover any benefit derived by the defendant through the
use, ownership, control or possession by the defendant of tangible property
situated within this state either at the time of the first use, ownership, control or
possession or at the time the action is commenced; or
(c) A claim that the defendant return, restore, or account to the plaintiff for
any asset or thing of value which was within this state at the time the defendant
acquired possession or control over it.
This subsection of the Wisconsin long-arm statute authorizes Wisconsin
courts to exercise jurisdiction over the person of a defendant who promises
to give or take some interest in real property in Wisconsin. A plaintiff may
sue a nonresident defendant as to the ownership, control, use, or possession
of real or personal property that either is situated in Wisconsin or was
acquired by the defendant in Wisconsin.
' Comment. Subjecting a nonresident defendant to personal
jurisdiction under subsection 801.05(6) is arguably reasonable based on
the presumption that the defendant has “purposefully availed” himself
or herself of the benefits of Wisconsin laws protecting real and personal
property rights. See supra § 3.61 (purposeful availment as element of
minimum contacts test).
e. [§ 3.79] Deficiency Judgments in Foreclosure
Sales
Subsection 801.05(7) provides that a court has personal jurisdiction over
a defendant in any action to recover a deficiency judgment on a mortgage
note, conditional sales contract, or other security agreement on which the
defendant is obliged if the deficiency is:
(a) In an action in this state to foreclose upon real property situated in this
state; or
(b) Following sale of real property in this state by the plaintiff under
[chapter] 846; or
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(c) Following resale of tangible property in this state by the plaintiff under
[chapter] 409.
Subsections (a) and (b) are related to the state’s power to adjudicate
interests in real property located within the state. See infra §§ 3.96–.105.
Subsection (c) relates to secured transactions in Wisconsin.
f. [§ 3.80] Officers and Directors
Subsection 801.05(8) provides for personal jurisdiction over a defendant
who is or was an officer, director, or manager of a domestic corporation or
limited liability company (LLC) if the cause of action arises out of the
defendant’s conduct as an officer, director, or manager or out of the
activities of the corporation or LLC while the defendant held office. The
exercise of jurisdiction under this subsection has been held constitutional
even when the defendant’s contacts with Wisconsin other than as a director
of a corporation were minimal. Stearn v. Malloy, 89 F.R.D. 421, 423 (E.D.
Wis. 1981). However, the subsection only applies when the corporation or
LLC is domestic. See Pavlic v. Woodrum, 169 Wis. 2d 585, 594–95, 486
N.W.2d 533 (Ct. App. 1992).
g. [§ 3.81] Taxes or Assessments
Subsection 801.05(9) authorizes a Wisconsin court to exercise personal
jurisdiction over a defendant in any action for the collection of taxes or
assessments levied, assessed, or otherwise imposed by a taxing authority of
the state after July 1, 1960.
h. [§ 3.82] Insurance or Insurers
Subsection 801.05(10) gives Wisconsin courts personal jurisdiction over
a defendant in any action arising out of the defendant’s promise to insure
against the happening of an event if either of the following conditions
apply:
(a) The person insured was a resident of this state when the event out of
which the cause of action is claimed to arise occurred; or
(b) The event out of which the cause of action is claimed to arise occurred
within this state, regardless of where the person insured resided.
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i. [§ 3.83] Certain Marital Actions
Subsection 801.05(11) provides for personal jurisdiction in certain
actions affecting the family (except for actions under chapter 769, the
Uniform Interstate Family Support Act).
j. [§ 3.84] Personal Representatives
Occasionally, a lawsuit must be brought against a decedent’s personal
representative. Sometimes, for example, a personal representative must be
substituted into a case because a defendant has died during the pendency of
the action. Subsection 801.05(12) governs personal jurisdiction in such
cases.
In any action against a deceased’s personal representative to enforce a
claim against the deceased, a Wisconsin court may exercise personal
jurisdiction if “one or more of the grounds stated in [subsections 801.05(2)–
(11)] would have furnished a basis for jurisdiction over the deceased had
the deceased been living.” Wis. Stat. § 801.05(12). Under subsection
801.05(12), the personal representative may only challenge the adequacy
of the decedent’s contacts with Wisconsin, not the adequacy of his or her
own contacts with the state. It is immaterial for purposes of subsection
801.05(12) whether the plaintiff commenced the lawsuit before or after the
decedent’s death.
On the substitution of parties upon a party’s death, see sections 4.70–.75,
infra.
k. [§ 3.85] Joinder of Claims
It is common for a plaintiff to join a number of claims against a
defendant in an action. See generally infra § 4.3. Subsection 801.05(13)
governs personal jurisdiction in such circumstances. If the basis for
personal jurisdiction over the defendant is one of those set forth in
subsection 801.05(1) (local presence or status), all of the claims will come
within the court’s general personal jurisdiction. However, if there are no
grounds for personal jurisdiction under subsection 801.05(1), the plaintiff
must assert separate grounds for personal jurisdiction over the defendant for
each claim joined against him or her. See Wis. Stat. § 801.05(13).
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' Caveat. If subsection 801.05(1) is asserted as the basis of a
plaintiff’s claims against a nonresident defendant who is served while
within Wisconsin on a transient basis, and the claims are unrelated to
Wisconsin, the defendant may still challenge the court’s personal
jurisdiction over him or her pursuant to subsection 801.05(1) on due
process grounds. See supra § 3.66 (due process issues relating to
personal jurisdiction over transient nonresident).
' Practice Tip. A plaintiff should not be deterred by subsection
801.05(13) from joining additional claims in an action that may have
questionable bases for personal jurisdiction under section 801.05. The
defense of lack of personal jurisdiction is waived if not raised in a timely
fashion. The defendant may not think to question personal jurisdiction
at all, or may not think to question personal jurisdiction as to some
rather than all of plaintiff’s claims. Finally, the defendant may simply
conclude that resolving all of the plaintiff’s claims in one action is
preferable to engaging in piecemeal litigation.
4. [§ 3.86] Special Jurisdictional Statutes
Subsection 801.05(2) authorizes a court to exercise personal jurisdiction
over a defendant “[i]n any action which may be brought under [Wisconsin]
statutes . . . that specifically confer grounds for personal jurisdiction over
the defendant.” This provision confirms that the Wisconsin long-arm
statute was not meant to supersede special personal jurisdictional statutes
in existence at the time the long-arm statute was enacted.
The following checklist provides some examples of special jurisdictional
statutes.
T
Checklist:
Some Examples of Special Jurisdictional Statutes
G Wis. Stat. § 345.09 (nonresident motorists).
G Wis. Stat. § 551.65(1), (2) (nonresident issuers of securities).
G Wis. Stat. § 645.04(5) (nonresident agents, brokers, and reinsurers obligated to domestic insurer in rehabilitation or
liquidation).
G Wis. Stat. § 704.22 (nonresident landlords).
G Wis. Stat. § 769.201 (nonresident individuals in actions under
the Uniform Interstate Family Support Act).
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G Wis. Stat. § 801.07(5) (quasi in rem jurisdiction in certain
family status actions).
With special jurisdictional statutes, as with the general long-arm statute,
due process concerns must be addressed as well. See In re Paternity of
Carlin L.S., 226 Wis. 2d 79, 89, 593 N.W.2d 486 (Ct. App. 1999) (holding
that Uniform Child Custody Jurisdiction Act did not satisfy due process
requirements necessary to allow personal jurisdiction over nonresident
respondent in paternity proceeding).
E. [§ 3.87] Consent to Personal Jurisdiction
1. [§ 3.88] Consent by Individuals and Corporations
An individual or a corporation may consent to jurisdiction in Wisconsin.
In commercial transactions, this consent is typically given before any
controversy has arisen. Contracts frequently specify the state in which any
suit seeking to determine rights under the contract will be brought.
Consent-to-venue clauses in contracts implicitly confer on the court the
right to exercise personal jurisdiction. Kohler Co. v. Wixen, 204 Wis. 2d
327, 337, 555 N.W.2d 640 (Ct. App. 1996). However, consent-to-venue
clauses, like other contract provisions, must be based on free bargaining.
First Fed. Fin. Serv., Inc. v. Derrington’s Chevron, Inc., 230 Wis. 2d 553,
558–59, 602 N.W.2d 144 (Ct. App. 1999). Unless the defendant can show
that a contract’s forum provision was not based on free bargaining, courts
will generally enforce such provisions. Kohler Co. v. Wixen, 204 Wis. 2d
327, 340, 555 N.W.2d 640 (Ct. App. 1996); see, e.g., Datronic Rental Corp.
v. DeSol, Inc., 164 Wis. 2d 289, 294–95, 474 N.W.2d 780 (Ct. App. 1991);
cf. Leasefirst v. Hartford Rexall Drugs, Inc., 168 Wis. 2d 83, 89–90, 483
N.W.2d 585 (Ct. App. 1992) (forum selection clause in equipment lease
was product of procedural unconscionability when salesman did not point
out clause printed in very small type on back page of lease). However,
when the dispute relates to a substantial right provided under Wisconsin
law, a Wisconsin court may choose to disregard a forum provision calling
for a forum outside Wisconsin. See, e.g., Cutter v. Scott & Fetzer Co., 510
F. Supp. 905, 908–09 (E.D. Wis. 1981) (forum selection clauses will not be
enforced when doing so would be inconsistent with purpose of Wisconsin
Fair Dealership Law).
Consent to personal jurisdiction is assumed when a party invokes the
court’s jurisdiction by seeking some relief. Thus, the filing of a complaint
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by a plaintiff constitutes consent to the court’s jurisdiction as to any
counterclaim filed against the plaintiff. Wis. Stat. § 801.06.
A defendant does not consent to personal jurisdiction merely by taking
some act, short of making an appearance in the action or filing a responsive
pleading, that indicates participation in the controversy. See In re Paternity
of Jonathan E.I., No. 98-1529-FT, 1999 WL 562223, *1 (Wis. Ct. App.
Aug. 3, 1999) (unpublished opinion not to be cited as precedent or authority
per section 809.23(3)) (holding that alleged father in paternity action did not
consent to personal jurisdiction in Wisconsin by voluntarily submitting to
blood test in California before filing motion to dismiss for lack of personal
jurisdiction).
2. [§ 3.89] Consent by the State; Sovereign Immunity from Suit
Under the doctrine of sovereign immunity, the state of Wisconsin may
not be sued without its consent. See Fiala v. Voight, 93 Wis. 2d 337, 342
n.3, 286 N.W.2d 824 (1980). Sovereign immunity is a matter of personal
jurisdiction. See, e.g., Manitowoc Co. v. City of Sturgeon Bay, 122 Wis. 2d
406, 411, 362 N.W.2d 432 (Ct. App. 1984). When the defense of sovereign
immunity is properly raised, courts lack personal jurisdiction over the state
of Wisconsin. Fiala, 93 Wis. 2d at 341; Carlson v. Pepin County, 167 Wis.
2d 345, 356, 481 N.W.2d 498 (Ct. App. 1992).
Historically, sovereign immunity was thought necessary to protect
public funds from being depleted in the payment of damage claims, and it
was reasoned that the need of the individual victim to be made whole had
to give way to the public welfare. See Sambs v. City of Brookfield, 97 Wis.
2d 356, 372, 293 N.W.2d 504 (1980). However, the wisdom of this
approach was questioned in Holytz v. Milwaukee, 17 Wis. 2d 26, 115
N.W.2d 618 (1962). In Holytz, the Wisconsin Supreme Court abrogated the
common law doctrine of governmental immunity from tort claims against
local units of government based on ministerial acts. In doing so, the court
noted that the state’s sovereign right not to be sued without its consent was
unaffected and invited the legislature to enact appropriate laws consenting
to suit in certain cases. Id. at 39–40.
In response to the Holytz decision, the Wisconsin Legislature enacted a
comprehensive scheme regulating how local governmental units, or their
agents and employees, may be sued in tort. See Wis. Stat. § 893.80. A
similar scheme was enacted for suits against state employees. See Wis. Stat.
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§ 893.82. Generally, these statutes impose short time limits for giving
notice of injury and filing claims. The notice of injury and the claims must
contain information set out in the statutes. If a plaintiff complies with these
notice requirements, the state’s defense of lack of personal jurisdiction
based on sovereign immunity is statutorily waived. See Ruh v. Samerjan,
816 F. Supp. 1326, 1330 (E.D. Wis. 1993), aff’d, No. 93-1799, 1994 WL
396215 (7th Cir. Aug. 1, 1994) (unpublished).
For a more detailed discussion of sovereign immunity, see sections
2.18–.34, supra.
F. [§ 3.90] Waiver of Defense of Lack of Personal
Jurisdiction
A defendant may waive the defense of lack of personal jurisdiction by
not raising it in a responsive pleading or motion to dismiss. Wis. Stat.
§ 802.06(8); see also Artis-Wergen v. Artis-Wergen, 151 Wis. 2d 445, 452,
444 N.W.2d 750 (Ct. App. 1989) (when an appearance is made and relief
is sought on other matters, the lack of personal jurisdiction objection is
waived). But see Honeycrest Farms, Inc. v. Brave Harvestore Sys., Inc.,
200 Wis. 2d 256, 259, 546 N.W.2d 192 (Ct. App. 1996) (when two
different insurers answered on behalf of defendant, and only one raised
defense of lack of personal jurisdiction, defense was not waived). A special
appearance to contest jurisdiction is no longer necessary, however.
Honeycrest Farms, Inc. v. A.O. Smith Corp., 169 Wis. 2d 596, 603, 486
N.W.2d 539 (Ct. App. 1992); see also infra § 5.67. Once a jurisdictional
objection is properly made, a party may participate in and contest the merits
of the action without waiving his or her objection to jurisdiction. See
Danielson v. Brody Seating Co., 71 Wis. 2d 424, 431, 238 N.W.2d 531
(1976).
G. [§ 3.91] Concurrent Personal Jurisdiction
At times, a defendant’s actions may bring the defendant within the
jurisdiction of two states. For example, in State v. Beck, 204 Wis. 2d 464,
555 N.W.2d 145 (Ct. App. 1996), a defendant who was clamming on the
Mississippi River in Iowa waters was cited by the Wisconsin Department
of Natural Resources for possession of undersized clam shells. The
Wisconsin Constitution sets the western boundary of the state at the center
of the main channel of the Mississippi River, Wis. Const. art. II, § 1, but
provides for Wisconsin concurrent jurisdiction on all rivers and lakes
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bordering the state so far as those rivers and lakes form a common boundary
to the state and any other state, Wis. Const. art. IX, § 1. Wisconsin is
permitted to exercise concurrent jurisdiction when the two states have
similar laws. State v. Nelson, 92 Wis. 2d 855, 858–59, 285 N.W.2d 924
(Ct. App. 1979). A Wisconsin law is “similar” to another state’s law if the
act Wisconsin seeks to punish is also a punishable act in the other state.
Beck, 204 Wis. 2d at 470.
H. [§ 3.92] Challenges to Personal Jurisdiction:
Procedural Considerations
1. [§ 3.93] In General
A defendant who wants to challenge a Wisconsin court’s exercise of
personal jurisdiction has to decide between a direct challenge and a
collateral challenge. In a direct challenge, the defendant raises and litigates
the issue in the lawsuit itself. In a collateral challenge, the defendant simply
does not appear in the Wisconsin action and later attempts to have the
default judgment declared void on due process grounds. Direct and
collateral challenges to personal jurisdiction are discussed in sections 3.94
and 3.95, infra, respectively.
' Note. Failure to obtain personal jurisdiction does not amount to
egregious conduct or bad faith of the sort that would lead to a dismissal
with prejudice. Haselow v. Gauthier, 212 Wis. 2d 580, 591–92, 569
N.W.2d 97 (Ct. App. 1997).
2. [§ 3.94] Direct Challenges
In Wisconsin (and under the Federal Rules of Civil Procedure), unless
the defense of lack of personal jurisdiction must be asserted in a responsive
pleading, or in a motion made in lieu of a responsive pleading, it is deemed
waived. See Wis. Stat. § 802.06(8)(a); Fed. R. Civ. P. 12. The philosophy
behind waiver of the defense is simple: the rules of personal jurisdiction
have primarily evolved in order to protect nonresident defendants from
having to defend in inconvenient locations, and such defendants are free to
waive this protection. Consequently, defendants are deemed to have
waived personal jurisdiction defenses if they have not acted affirmatively
to protect them.
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A motion challenging personal jurisdiction under section 802.06(2)(a)3.
should be accompanied by affidavits setting forth pertinent facts relating to
the court’s lack of personal jurisdiction. See, e.g., Henderson v. Milex
Prods., Inc., 125 Wis. 2d 141, 143, 370 N.W.2d 291 (Ct. App. 1985); see
also infra § 9.17. Unless the court can conclude, based on the defendant’s
motion and affidavit, that it has personal jurisdiction, it must set up an
evidentiary hearing. The burden of proof at this point falls on the plaintiff
(or party asserting that personal jurisdiction exists). International
Placement & Recruiting v. Reagan Equip. Co., 592 F. Supp. 1252, 1255
(E.D. Wis. 1984); Mendez v. Hernandez-Mendez, 213 Wis. 2d 217, 226,
570 N.W.2d 563 (Ct. App. 1997).
At an evidentiary hearing, a plaintiff is not bound by the allegations of
the complaint but is free to present additional facts. It is not a defense to a
party’s assertion of the court’s personal jurisdiction that the complaint itself
does not allege facts sufficient to support personal jurisdiction. In fact, the
plaintiff may not rest on the allegations of the complaint, even one that has
been verified, in establishing jurisdictional facts supporting personal
jurisdiction over the defendant, Pavalon v. Thomas Holmes Corp., 25 Wis.
2d 540, 547, 131 N.W.2d 331 (1964), unless the defendant has admitted the
allegations by answer or other pleading. State v. Advance Mktg. Consultants, Inc., 66 Wis. 2d 706, 714–15, 225 N.W.2d 887 (1975).
The evidentiary hearing on personal jurisdiction is conducted by the
court without a jury and must be held before the court hears any issues
going to the merits of the case. Wis. Stat. § 801.08. The plaintiff has the
duty to demonstrate that personal jurisdiction is (1) proper under an
applicable long-arm statute and (2) consistent with constitutional due
process. Afram, 63 Wis. 2d at 707–08. Factual determinations made by the
court in deciding whether it has personal jurisdiction over the defendant are
not binding on the parties at the later trial on the merits of the action. Wis.
Stat. § 801.08(2).
' Practice Tip. The party asserting that personal jurisdiction exists
may be hampered in proving that the defendant has sufficient minimum
contacts with Wisconsin if the court takes the position that it must first
have personal jurisdiction over the defendant before it can require the
defendant to comply with discovery in the lawsuit. The Wisconsin
Supreme Court took this position in Stroup v. Career Academy, Inc., 38
Wis. 2d 284, 290, 156 N.W.2d 358 (1968), holding that when an
objection to jurisdiction is made, the jurisdictional issue should be tried
before the parties proceed with discovery since a court must have
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jurisdiction over the parties in order to permit discovery. However, the
supreme court held otherwise in Bielefeldt v. St. Louis Fire Door Co., 90
Wis. 2d 245, 279 N.W.2d 464 (1979). Without addressing Stroup, the
court held that discovery on a jurisdictional issue was appropriate in
advance of a pretrial jurisdictional hearing. Id. at 255. The Bielefeldt
holding is consistent with federal court decisions holding that courts
have jurisdiction to determine their own jurisdiction, Resolution Trust
Corp. v. Lightfoot, 938 F.2d 65, 67 (7th Cir. 1991), and that a trial court
has wide discretion to allow affidavits, documents, and even a limited
evidentiary hearing to resolve disputed jurisdictional facts. Ohio Nat’l
Life Ins. Co. v. United States, 922 F.2d 320, 325 (6th Cir. 1990); see
also Katz v. Princess Hotels Int’l, Inc., 839 F. Supp. 406, 410–11 (E.D.
La. 1993). The better considered position would seem to be that the
plaintiff should be entitled to limited discovery on the jurisdictional
issue. See Wis. Stat. § 804.01(2)(a).
For a discussion of motions to dismiss for lack of personal jurisdiction,
see section 9.17, infra.
3. [§ 3.95] Collateral Challenges
A collateral challenge to personal jurisdiction occurs in a legal action
that is separate from the action in which personal jurisdiction was originally
in question. With a collateral challenge, typically the defendant fails to
appear in the Wisconsin action, which leads to a default judgment.
Frequently, the plaintiff attempts to enforce the judgment in the state where
the defendant resides. The defendant then attempts to have the default
judgment declared void, usually on due process grounds.
' Note. The mechanism for enforcing the judgment in the defendant’s state of residence is often the Uniform Enforcement of Foreign
Judgments Act, codified under Wisconsin law at section 806.24. Under
the act, a foreign judgment is subject to the same procedures, defenses,
and proceedings for reopening, vacating, or staying as the forum court’s
judgment. Wis. Stat. § 806.24(2).
It is also possible for the defendant to challenge Wisconsin’s jurisdiction
by (1) commencing a new action in Wisconsin or (2) raising the issue in
subsequent proceedings brought by the plaintiff to enforce the judgment in
Wisconsin. The defendant could also move after judgment to vacate the
prior judgment, Wis. Stat. § 806.07, on the grounds that the court was
without jurisdiction. However, unless an objection was made to jurisdiction
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in the original action, the defense will most likely be claimed waived. Wis.
Stat. § 802.06(8)(a).
' Practice Tip. The risk attendant on a collateral challenge is
obvious: A collateral challenge, if unsuccessful, will have foreclosed
the possibility of a defense of the action on the merits by allowing the
matter to proceed to a default judgment. The potential benefit of a
collateral challenge is that the nonresident defendant may find in his or
her own state a court receptive to taking a narrow view of a Wisconsin
court’s right to exercise personal jurisdiction. Such a strategy might be
employed when the defendant has no defense on the merits or when the
defendant believes his or her defense is unlikely to be successful. In
such a case, a collateral challenge to jurisdiction might be considerably
less expensive than a defense on the merits.
V. [§ 3.96] In Rem and Quasi in Rem Jurisdiction
A. [§ 3.97] In General
In addition to exercising jurisdiction over persons having sufficient
contacts with the state of Wisconsin, Wisconsin circuit courts may have the
power to adjudicate ownership rights in or the status of real and personal
property located within the state. See Wis. Stat. § 801.07. This power to
adjudicate is known generally as in rem jurisdiction (literally, “jurisdiction
against the thing”). In rem jurisdiction is divided into two subclasses:
(1) true in rem jurisdiction, and (2) quasi in rem jurisdiction. These two
subclasses are discussed in sections 3.98 and 3.99–.101, infra, respectively.
B. [§ 3.98] In Rem Jurisdiction
When a court is being asked to determine the rights of all persons
everywhere in property located in Wisconsin, the action is in rem. True in
rem actions are rare. Typical of such actions are real estate quiet title
actions and eminent domain proceedings.
Frequently—for example in a mortgage foreclosure—relief is sought
both in rem and in personam. When a plaintiff is seeking a deficiency
judgment or damages against a defendant personally in connection with a
foreclosure, an independent ground for personal jurisdiction must be found
under section 801.05, the Wisconsin long-arm statute, see supra §§ 3.62–
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.85. When the relief sought is purely in rem, the basis for jurisdiction is to
be established under section 801.07, rather than section 801.05.
C. [§ 3.99] Quasi in Rem Jurisdiction
1. [§ 3.100] In General
In quasi in rem actions, the property in which the court is determining
property interests is not the subject of the underlying action. Typical
examples of this type of action are garnishments and attachments. See infra
§ 3.101. Quasi in rem actions also may be used to determine status
questions in certain actions affecting the family. See Mendez v. HernandezMendez, 213 Wis. 2d 217, 223, 570 N.W.2d 563 (Ct. App. 1997).
Often, a quasi in rem action is undertaken to secure some remedy against
specific property in support of a larger dispute between the parties. Quasi
in rem actions historically have also been used to lure a defendant into a
state in order to assert personal jurisdiction over that defendant. See infra
§ 3.104. However, the U.S. Supreme Court has clarified that a state may
not constitutionally exercise quasi in rem jurisdiction over a defendant who
has no contacts with the forum state. Rush v. Savchuk, 444 U.S. 320, 332–
33 (1980); Shaffer v. Heitner, 433 U.S. 186, 208–12 (1977); see also
Mendez v. Hernandez-Mendez, 213 Wis. 2d 217, 225–26, 570 N.W.2d 563
(Ct. App. 1997); see infra § 3.102.
2. [§ 3.101] Garnishment and Attachment
Garnishment and attachment are statutory remedies available in support
of an effort to collect a debt owed to a plaintiff. Both remedies may
sometimes be used prior to judgment (and historically were often used in
this manner to assert quasi in rem jurisdiction over defendants who were not
otherwise subject to personal jurisdiction in the state, but see infra § 3.102).
Under the attachment statutes, chapter 811, a plaintiff is entitled, upon the
proper showing, to have property of a defendant seized or, in the case of
real estate, subjected to a judicial lien, pending establishment of a judgment
on the underlying debt. Once the judgment on the underlying claim is
established, the seized or liened property may then be disposed of and the
proceeds applied to the judgment. Under the garnishment statutes, chapter
812, a plaintiff likewise may seize a debtor’s earnings before obtaining a
judgment on the underlying debt.
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' Note. Certain prejudgment attachment and garnishment procedures
have been challenged and found unconstitutional under the 14th Amendment of the United States Constitution, which forbids “any State” from
“depriv[ing] any person of life, liberty, or property, without due process
of law.” See Fuentes v. Shevin, 407 U.S. 67, 96–97 (1972); Sniadach v.
Family Fin. Corp., 395 U.S. 337, 337–39 (1969). However, not all
prejudgment attachment and garnishment procedures are unconstitutional. Prejudgment attachment and garnishment, without prior notice
or hearing, are constitutional in extraordinary circumstances, when the
need for a predeprivation hearing is low and the state institutes sufficient
safeguards to protect the defendant’s due process rights. Connecticut v.
Doehr, 501 U.S. 1, 4 (1991); Mitchell v. W.T. Grant Co., 416 U.S. 600,
607–10 (1974).
D. [§ 3.102] Minimum Contacts Requirement
Until 1977, plaintiffs in quasi in rem and in rem cases did not have to be
concerned with the extent of a named defendant’s contacts with the forum
state; it was sufficient that the real or personal property at issue had its situs
in the forum state. In 1977, however, the United States Supreme Court held
in Shaffer v. Heitner, 433 U.S. 186, 208–12 (1977), that International
Shoe’s minimum contacts test, see supra § 3.61, applied to in rem and quasi
in rem decisions. Under Shaffer v. Heitner, a Wisconsin court must require
the plaintiff to show some minimal contacts connecting the creditor’s claim,
the property attached, and the defendant’s contacts with Wisconsin before
concluding that it has quasi in rem jurisdiction as a result of an attachment.
E. [§ 3.103] Strategic Considerations
1. [§ 3.104] Plaintiff
In the past, in rem actions—and more particularly quasi in rem actions—
were sometimes used by plaintiffs to try to compel a defendant to litigate
in a forum state where the defendant would not have been amenable to
personal jurisdiction. This strategy required locating property within the
forum state that the defendant would consider dear enough to come and
defend. Although the in rem judgment would only determine rights in the
property itself, the underlying dispute between the plaintiff and the
nonresident defendant frequently would be adjudicated first. Further, the
value of the nonresident defendant’s interest in the property was frequently
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greater than the value of the underlying debt. Because the location of a
debtor owing money to a nonresident defendant was considered to be the
situs of the debt, a garnishment or attachment action would be brought
within the forum where the nonresident defendants’s debtor resided, in an
effort to secure money relief against the nonresident defendant.
' Caution. Because minimum contacts are now required for in rem
and quasi in rem jurisdiction on due process grounds, see supra § 3.102,
this strategy is not likely to succeed.
2. [§ 3.105] Defendant
When a defendant is served with proper notice that property of the
defendant located in Wisconsin has been seized in order to satisfy a
purported debt, the defendant will have to decide between two strategies.
First, the defendant may elect to defend the action on the merits. However,
this approach risks a ruling that precludes relitigation in a later action on the
same debt. Alternatively, the defendant may simply challenge the court’s
jurisdiction over the property itself by appearing and objecting to jurisdiction.
' Practice Tip. Under Wisconsin law, a special appearance to
challenge jurisdiction is unnecessary. A defendant who objects to
jurisdiction may participate in and contest the merits of the case without
waiving the objection to jurisdiction. Danielson, 71 Wis. 2d at 431.
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