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Byrnes v. Metz

Supreme Court of Wisconsin
Feb 1, 1972
193 N.W.2d 675 (Wis. 1972)


No. 247.

Argued January 4, 1972. —

Decided February 1, 1972.

APPEAL from a judgment of the circuit court for Milwaukee county: CARL H. DALEY, Reserve Circuit Judge, Presiding. Affirmed.

For the appellants there was a brief by Niebler Niebler and John H. Niebler, all of Menomonee Falls, and oral argument by John H. Niebler.

For the respondents there was a brief by Erbstoeszer, Cleary Zabel, Ltd., and oral argument by Patrick T. McMahon, all of Milwaukee.

This appeal concerns the damages recoverable under an injunction bond. On April 9, 1968, the circuit court for Milwaukee county, HON. WILLIAM I. O'NEILL presiding, issued a temporary injunction at the request of plaintiffs-appellants, Mary W. Byrnes, Joseph P. Gilsinger and Henry Laabs, Jr. This injunction restrained defendants-respondents, Thomas Metz, Charles Metz and Mrs. Charles Metz, from excavating, erecting or constructing on a certain lot located in the city of Wauwatosa. Under the provisions of the injunction, appellants were to post a bond in the amount of $7,500. It was appellants' contention that the buildings proposed by respondents for this lot did not comply with the zoning code of the city of Wauwatosa.

The matter was tried before Judge O'NEILL on September 17, 1968. On October 23, 1968, the court rendered judgment in favor of respondents, dismissed the complaint, and ordered the, temporary injunction vacated. On December 10, 1968, such judgment was entered. After the appeal period had expired, construction was started.

On April 17, 1969, respondents petitioned the circuit court, Hon. CARL H. DALEY, reserve circuit judge, presiding, for a reference to determine the damages under the injunction bond. The court appointed Court Commissioner Patrick T. Sheedy to act as referee. Commissioner Sheedy determined that respondents were entitled to the following damages:

Loss of income from property $ 142.82 Legal expenses 500.00 Increased construction costs 5,200.00 On May 22, 1970, the circuit court entered an order awarding respondents those damages found by the referee.

Following the entry of the order respondents taxed costs amounting to $2,412.86. The clerk of circuit court refused to tax the costs and referred the matter back to the court. The court ordered that the amount taxed for attorneys' fees — $2,200 — be reduced by $900. On October 5, 1970, the court entered judgment awarding respondents the damages assessed by the referee and, as reduced, $1,512.86 in costs and disbursements. Plaintiffs appeal from that part of the judgment awarding the Metzes $5,200 for increased construction costs and $1,512.86 for costs and disbursements in the action.

Three questions are raised on this appeal:

1. Are the increased costs of construction recoverable under the injunction bond?

2. Did respondents violate their duty to mitigate their damages?

3. Did the circuit court abuse its discretion in setting costs and attorneys' fees?

Increased construction costs.

The basic rule for computing damages under an injunction bond was first set out by this court in 1846 in Gear v. Shaw:

(1846), 1 Pin. 608, 617.

". . . The party is entitled to such damages as he may have reasonably sustained by being deprived of the profits of the work he was engaged at when the injunction was served. . . . The damages are to be estimated, with reference to his business and profits at the time of the service of the writ . . . ."

This rule was reaffirmed in 1932 in Muscoda Bridge Co. v. Worden-Allen Co. The crucial issue on this appeal is whether the increased costs of construction are recoverable under this rule.

Under the terms of the contract between respondents and their contractor, the contract was cancelled when this injunction was issued, unless respondents agreed to pay the increased costs of construction between the time of the contract, November 26, 1967, and the time actual construction was commenced. There is no doubt but that between the time of the original contract and the time the injunction was finally lifted construction costs did increase.

The basic question of whether such increased construction costs are recoverable is one of first impression in Wisconsin. Appellants contend that since the damages claimed are for future increases in costs not in existence at the time the injunction was issued, they are not recoverable. Other courts which have considered the question have allowed recovery for increased construction costs. Such recovery is consistent with the general principle that any loss of ascertainable value resulting from the improvident issuance of a temporary injunction is recoverable. The cost to respondents of the buildings increased only because of the temporary injunction, not because of subsequent events. Under the rule of Gear v. Shaw, as construed in subsequent cases, the increased construction costs are recoverable.

Roberts v. White (1878), 73 N.Y. 375, 381; School District v. Mercur (1911), 46 Pa. Super. 470, 474.

Muscoda Bridge Co. v. Worden-Allen Co., supra, footnote 2, at page 30; Antigo Electric Co. v. Faust Lumber Co. (1932), 209 Wis. 139, 144, 244 N.W. 604.

Supra, footnote 1.

Duty to mitigate damages.

Appellants contend that even if the increased costs of construction are recoverable, respondents failed to exercise their duty to mitigate damages. At the hearing before the referee appellants produced evidence that buildings similar to those constructed by respondents could have been built with only a three percent, or $1,500, increase in costs during the period of the injunction. However, respondents countered with testimony that the buildings they wanted were of superior quality to those referred to by appellants' witnesses.

The burden of proof is upon the delinquent party to show that the opposing party could have mitigated his damages. Furthermore, the duty to mitigate damages is imposed only to the extent that it is reasonable to do so. In the present case appellants' witnesses were unable to testify whether they could build the same buildings as those constructed by respondents' contractors. Neither witness called by appellants had been inside the buildings or had knowledge of the materials used in the construction of the buildings. Their testimony was that they could build "similar" buildings for less.

Medbery v. Sweet (1851), 3 Pin. 210, 3 Chand. 231; Annot. (1941), 134 A.L.R. 242, 243.

O'Brien v. Isaacs (1962), 17 Wis.2d 261, 266, 116 N.W.2d 246.

In Ashley v. American Automobile Ins. Co. this court indicated that it would not be unreasonable for an accident victim to seek medical care in a distant city even though the same treatment was available closer to her home for one half the cost. The same rationale applies here. Respondents were obviously satisfied with the contractor they had originally selected, and they believed that his work was superior to that offered by other contractors. Appellants have failed to prove that respondents could have mitigated their loss and still have buildings of the quality they desired or that their reliance on the contractor was unreasonable.

Appellants further argue that respondents did not prove that building costs had increased by $5,200. There was testimony to support that amount of increase. That evidence could be considered by the trier of fact.

Appellants contend that respondents are not entitled to these damages because they had not actually paid out any additional money but had added to the amount of the mortgage on the property. There is no merit in this contention. Damages under the injunction bond are determined by what events caused the total loss. These damages are computed as of that time regardless of when the loss is actually sustained. While it is possible that the additional $5,200 may not be actually paid by respondents until the mortgage is paid off, the fact remains that there will be an additional $5,200 ultimately spent by respondents which is the result of the injunction; they are bound to this increased expense. Thus the damages were properly assessed.

Attorney's fees.

Appellants' final contention is that the assessment of $1,300 attorneys' fees and $212 in other costs is excessive. In the Muscoda Bridge Case, this court indicated that in an action upon an injunction bond the prevailing party is entitled to the reasonable value of the services rendered by attorneys on the reference. Such determination of what are reasonable attorneys' fees is within the discretion of the trial court.

Supra, footnote 2, at pages 29, 30.

Commercial Casualty Ins. Co. v. Frost (1931), 206 Wis. 178, 182, 239 N.W. 454.

In the present case a detailed enumeration of the legal services rendered was submitted to the trial court. The court reduced those fees by $900 — from $2,200 to $1,300. A review of the statement of attorneys' fees does not reveal that it is unreasonable. Except for asserting that the allotted fees are excessive, appellants advance no argument of why or how the court abused its discretion in awarding such costs. On the state of the present record, no abuse of discretion has been shown.

By the Court. — Judgment affirmed.

Summaries of

Byrnes v. Metz

Supreme Court of Wisconsin
Feb 1, 1972
193 N.W.2d 675 (Wis. 1972)
Case details for

Byrnes v. Metz

Case Details

Full title:BYRNES and others, Appellants, v. METZ and others, Respondents

Court:Supreme Court of Wisconsin

Date published: Feb 1, 1972


193 N.W.2d 675 (Wis. 1972)
193 N.W.2d 675

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