Drinkwater v. American Family Mutual Insurance

DAVID T. PROSSER, J.

¶ 66. {dissenting). The made-whole doctrine is a well-established feature of *667Wisconsin tort and insurance law. I support this doctrine and wish it were the law in all jurisdictions. Unfortunately, it is not. We must recognize that fact in considering this case.

¶ 67. Shane Drinkwater was very badly injured by an underinsured Wisconsin motorist. He has not been made whole. If Mr. Drinkwater were employed by a Wisconsin employer and insured by a Wisconsin insurer, there would be no dispute that the made-whole doctrine would apply to his case. But the facts are otherwise. At the time of the accident, Mr. Drinkwater worked for an Iowa employer and was insured by an Iowa health plan. In the insurance contract, the Iowa insurer explicitly reserved its subrogation rights, as permitted under Iowa law, and it unambiguously provided that Iowa law would govern the contract.

¶ 68. Mr. Drinkwater's employer, United Clinical Laboratories, is located in Dubuque. The company has more than 100 employees.

¶ 69. The Dubuque metropolitan area includes the states of Illinois, Iowa, and Wisconsin. Jo Daviess County in Illinois and Grant County in Wisconsin are directly across the Mississippi River from Dubuque. Because of this geography, there is a good possibility that Shane Drinkwater was not the only Wisconsin resident who worked for United Clinical Laboratories. There is a good possibility that Illinois residents work there as well.

¶ 70. All the employees of United Clinical Laboratories who live in Iowa and all the employees of United Clinical Laboratories who live in Illinois are governed by the subrogation clause in the Medical Associates Health Plan. The Illinois residents are gov*668erned by the clause because Illinois,1 like Iowa,2 does not recognize the made-whole doctrine.

¶ 71. United Clinical Laboratories is one of numerous employers in the border states of Illinois and Iowa who employ Wisconsin residents. Many of these employers afford their employees health care plans that contractually reserve subrogation rights and do not recognize the made-whole doctrine. Some of these employers may be much smaller than United Clinical Laboratories. Conversely, Shane Drinkwater is one of the thousands of Wisconsin residents who drive across this state's border to take advantage of an employment opportunity and health insurance in one of these neighboring states.3

¶ 72. These Wisconsin residents will receive enhanced protection because of this court's decision if they are involved in an accident in Wisconsin. They will receive more protection than their co-workers and consequently may become more expensive to insure than their co-workers who live in Illinois or Iowa. This may have an effect on health care costs for their employers. It may have an effect on Wisconsin resident employment.

¶ 73. In resolving the choice of law issue presented here, the court skillfully marshals the facts and *669policy in a manner that supports its decision. But some of the facts carry no weight. For instance, the fact that "[t]he tortfeasor is a resident of Wisconsin and was covered under an insurance policy issued by a Wisconsin insurance company," majority op., ¶ 44, is really not relevant. The law would not be different if the tortfeasor lived in Illinois and was covered under a policy issued by an Illinois insurance company. What is important is that the tortfeasor's insurer provided liability coverage.

¶ 74. The fact that "[b]oth Drinkwater and the other driver were operating vehicles registered in Wisconsin at the time of the accident," id,., also is not significant. It merely supplements the fact that the two drivers were Wisconsin residents.

¶ 75. There are three important Wisconsin-related facts: (1) Mr. Drinkwater was and is a Wisconsin resident; (2) his accident occurred in Wisconsin; and (3) his suit was filed in Wisconsin.

¶ 76. The rule of this case is that Wisconsin law will trump Illinois or Iowa subrogation law on a Wisconsin injury to a Wisconsin resident when the case is tried in a Wisconsin court.

¶ 77. What is not clear is what the result would be if there were a Wisconsin injury to an Illinois or Iowa resident and the case were tried in a Wisconsin court against the insured's home state insurer (like Medical Associates Health Plan) claiming subrogation rights. Because Wisconsin is visited by hundreds of thousands of out-of-state tourists, this sort of scenario must be anticipated.

¶ 78. We also do not know what the result would be if a Wisconsin resident like Mr. Drinkwater were to be injured in an Illinois or Iowa accident but able to sue in Wisconsin and bring in the out-of-state insurer claiming subrogation.

*670¶ 79. This uncertainty undermines the predictability of results. As this court stated:

Predictability is one of the choice-influencing considerations that deserves special emphasis in consensual arrangements... . [S]ince a legal relationship is entered into by pre-arrangement, it is imperative that the parties know their rights will be the same, irrespective of the forum, and that their agreement will have the same consequences, irrespective of where the contract is performed or where a dispute in regard to it is resolved.

Heath v. Zellmer, 35 Wis. 2d 578, 596, 151 N.W.2d 664 (1967).

¶ 80. The result in this case is certainly fair to Mr. Drinkwater. The nagging concern is whether our decision will have collateral consequences to other people or the law.

Eddy v. Sybert, 783 N.E.2d 106, 110 (Ill. App. Ct. 2003).

Ludwig v. Farm Bureau Mut. Ins. Co., 393 Wis. 2d 143 (Iowa 1986).

The Wisconsin Department of Revenue estimates that in 2004 more than 53,000 Wisconsin residents were employed at jobs in Illinois. See Letter dated December 28, 2005, from Michael L. Morgan, State of Wisconsin Secretary of Revenue, to Brian Hamer, Director, Illinois Department of Revenue (on file with the State of Wisconsin Department of Revenue, Madison, Wisconsin).