First Federated Savings Bank v. McDonah

SUNDBY, J.

(dissenting). Our decision herein should be of great concern to all members of the practicing bar. It exposes any attorney and his or her client who files a general denial answer under sec. 802.02(2), Stats., to a determination that the answer is frivolous under sec. 814.025(3)(b), Stats. Further, it raises the very real spectre of a trial court inquiry into the subjective intent of the attorney whenever a general denial answer is filed.

The trial court did not find that the answer filed in this case was intrinsically frivolous but that the filing of the answer was frivolous under sec. 814.025(3)(b), Stats., because it was interposed for purposes of delay.1 An answer filed solely for purposes *437of delay may be frivolous under sec. 814.025(3)(a), as a defense made in bad faith. However, if it is claimed that a defense is frivolous under sec. 814.025(3)(a), an attorney and his or her client are protected by the requirement that it must be established that the purpose in making the defense was "solely for purposes of harassing or maliciously injuring another.” Under sec. 814.025(3)(b), however, the standard applicable to a defense is knowledge of a lack of reasonable basis therefor in law or equity or for a good faith extension, modification or reversal of existing law. I see no sensible way of defending against a claim that an answer is frivolous under sec. 814.025(3)(b) where the alleged reason for the frivolousness is extrinsic to the pleading.

I would reverse and remand this case to the trial court for a hearing on whether the defendants and their counsel filed the answer in these proceedings in bad faith, solely for purposes of harassing or maliciously injuring First Federated.

Section 802.05 Stats., provides that the signature of an attorney to a pleading constitutes a certificate that the pleading is not interposed for delay. That statute further provides:

*437If a pleading ... is signed with intent to defeat the purpose of this section, it may be stricken as sham and false and the action may proceed as though the pleading had not been served. For a wilful violation of this section an attorney may be subjected to appropriate disciplinary action. ...

The trial court made no finding that the defendants’ attorney wilfully violated this section.