Rule text
(1) After issue is joined but at least 20 days before the trial, the defendant may serve upon the plaintiff a written offer to allow judgment to be taken against the defendant for the sum, or property, or to the effect therein specified, with costs. If the plaintiff accepts the offer and serves notice thereof in writing, before trial and within 10 days after receipt of the offer, the plaintiff may file the offer, with proof of service of the notice of acceptance, and the clerk must thereupon enter judgment accordingly. If notice of acceptance is not given, the offer cannot be given as evidence nor mentioned on the trial. If the offer of judgment is not accepted and the plaintiff fails to recover a more favorable judgment, the plaintiff shall not recover costs but defendant shall recover costs to be computed on the demand of the complaint.
(2) After issue is joined but at least 20 days before trial, the defendant may serve upon the plaintiff a written offer that if the defendant fails in the defense the damages be assessed at a specified sum. If the plaintiff accepts the offer and serves notice thereof in writing before trial and within 10 days after receipt of the offer and prevails upon the trial, either party may file proof of service of the offer and acceptance and the damages will be assessed accordingly. If notice of acceptance is not given, the offer cannot be given as evidence nor mentioned on the trial. If the offer is not accepted and if damages assessed in favor of the plaintiff do not exceed the damages offered, neither party shall recover costs.
(3) After issue is joined but at least 20 days before trial, the plaintiff may serve upon the defendant a written offer of settlement for the sum, or property, or to the effect therein specified, with costs. If the defendant accepts the offer and serves notice thereof in writing, before trial and within 10 days after receipt of the offer, the defendant may file the offer, with proof of service of the notice of acceptance, with the clerk of court. If notice of acceptance is not given, the offer cannot be given as evidence nor mentioned on the trial. If the offer of settlement is not accepted and the plaintiff recovers a more favorable judgment, the plaintiff shall recover double the amount of the taxable costs.
(4) If there is an offer of settlement by a party under this section which is not accepted and the party recovers a judgment which is greater than or equal to the amount specified in the offer of settlement, the party is entitled to interest at an annual rate equal to 1 percent plus the prime rate in effect on January 1 of the year in which the judgment is entered if the judgment is entered on or before June 30 of that year or in effect on July 1 of the year in which the judgment is entered if the judgment is entered after June 30 of that year, as reported by the federal reserve board in federal reserve statistical release H. 15, on the amount recovered from the date of the offer of settlement until the amount is paid. Interest under this section is in lieu of interest computed under ss. 814.04 (4) and 815.05 (8).
(5) Subsections (1) to (4) apply to offers which may be made by any party to any other party who demands a judgment or setoff against the offering party.
Notes
807.01 History History: Sup. Ct. Order, 67 Wis. 2d 585, 741 (1975); Sup. Ct. Order, 67 Wis. 2d vii (1975); 1975 c. 218; 1979 c. 271; 1981 c. 314; 1983 a. 253; 1985 a. 340; 2011 a. 69.
807.01 Cross-reference Cross-reference: For tender of payment, see s. 895.14.
807.01 Annotation Sub. (3) applies to cases of both liquidated and unliquidated damages. Graves v. Travelers Insurance Co., 66 Wis. 2d 124, 224 N.W.2d 398 (1974).
807.01 Annotation Subs. (3) and (4) do not apply to a rejected joint settlement offer made on behalf of individual plaintiffs. White v. General Casualty Co. of Wisconsin, 118 Wis. 2d 433, 348 N.W.2d 614 (Ct. App. 1984).
807.01 Annotation Defendants who are jointly and severally liable may submit joint offers of judgments to an individual plaintiff under sub. (1). Denil v. Integrity Mutual Insurance Co., 135 Wis. 2d 373, 401 N.W.2d 13 (Ct. App. 1986).
807.01 Annotation Offers under sub. (3) are revocable. Sonnenburg v. Grohskopf, 144 Wis. 2d 62, 422 N.W.2d 925 (Ct. App. 1988).
807.01 Annotation Under sub. (3), a plaintiff suing multiple defendants under multiple theories, one of which involves several liability, must make separate settlement offers. Smith v. Keller, 151 Wis. 2d 264, 444 N.W.2d 396 (Ct. App. 1989).
807.01 Annotation Sub. (4) provides for simple, rather than compound, interest to accrue on the amount recovered. Discussing the relationship between sub. (4) and s. 628.46 (1). Upthegrove Hardware, Inc. v. Pennsylvania Lumbermans Insurance Co., 152 Wis. 2d 7, 447 N.W.2d 367 (Ct. App. 1989).
807.01 Annotation While the inclusion of a reference to this section is preferable, a settlement offer that should reasonably be understood as an offer pursuant to this section is sufficient to invoke its provisions. Bauer v. Piper Industries, Inc., 154 Wis. 2d 758, 454 N.W.2d 28 (Ct. App. 1990).
807.01 Annotation A plaintiff’s offer of settlement addressed to multiple defendants reciting one aggregate settlement figure for all claims did not allow the defendants to individually assess their own exposure and was not valid for sanctions purposes. Wilber v. Fuchs, 158 Wis. 2d 158, 461 N.W.2d 803 (Ct. App. 1990).
807.01 Annotation A plaintiff’s single offer of settlement to two individual defendants and the insurer of both, within the policy limits, invoked sanctions under this section as the insurer was the only party interested in the settlement and could fully evaluate its exposure. Testa v. Farmers Insurance Exchange, 164 Wis. 2d 296, 474 N.W.2d 776 (Ct. App. 1991).
807.01 Annotation When damages are subject to a statutory limit, costs and interest awarded under this section are in addition to the damage award. Gorman v. Wausau Insurance Cos., 175 Wis. 2d 320, 499 N.W.2d 245 (Ct. App. 1993).
807.01 Annotation An insurer was not subject to sanctions under this section when, after initially rejecting the plaintiff’s offer to settle, new facts resulted in the insurer’s submitting its own offer to settle in the same amount. Oliver v. Heritage Mutual Insurance Co., 179 Wis. 2d 1, 505 N.W.2d 452 (Ct. App. 1993).
807.01 Annotation Separate offers to the defendant and the defendant’s insurer in the same amount, which left unclear whether acceptance by the insurer also released the insured, did not invoke sanctions under this section when the verdict exceeded the amount of the individual offers. Cue v. Carthage College, 179 Wis. 2d 175, 507 N.W.2d 109 (Ct. App. 1993).
807.01 Annotation Common law prejudgment interest and 12 percent interest under sub. (4) are not to be combined. Erickson v. Gundersen, 183 Wis. 2d 106, 515 N.W.2d 293 (Ct. App. 1994).
807.01 Annotation Interest under sub. (4) does not accrue on an award of double costs under sub. (3). American Motorists Insurance Co. v. R&S Meats, Inc., 190 Wis. 2d 196, 526 N.W.2d 791 (Ct. App. 1994).
807.01 Annotation A party making a settlement offer must do so in clear and unambiguous terms. A party’s mere offer to settle for a specified sum when a part of the party’s claim had been admitted and already reduced to judgment was ambiguous. Stan’s Lumber, Inc. v. Fleming, 196 Wis. 2d 554, 538 N.W.2d 849 (Ct. App. 1995), 94-1258.
807.01 Annotation In a case involving a subrogated defendant, the failure of an offer to specify whether payment to the subrogated defendant would be made from the settlement proceeds left the defendants unable to fully evaluate their exposure so that the offer was not valid for purposes of sub. (3). Ritt v. Dental Care Associates, S.C., 199 Wis. 2d 48, 543 N.W.2d 852 (Ct. App. 1995), 94-3344.
807.01 Annotation A judgment against a defendant to whom an offer to settle was made that was equal to or larger than the offer entitles the plaintiff to interest under sub. (4) on the amount recovered against the party to whom the offer was made. Blank v. USAA Property & Casualty Insurance Co., 200 Wis. 2d 270, 546 N.W.2d 512 (Ct. App. 1996), 95-1806.
807.01 Annotation Under sub. (3), the offer and judgment must be compared exclusive of any costs. Northridge Co. v. W.R. Grace & Co., 205 Wis. 2d 267, 556 N.W.2d 345 (Ct. App. 1996), 95-1193.
807.01 Annotation A single offer made to the plaintiff on condition that the plaintiff “indemnify or otherwise satisfy any existing related subrogated claims” invoked sub. (1) when the plaintiff knew the amount of the only subrogated claims and could fully and fairly evaluate the offer. Staehler v. Beuthin, 206 Wis. 2d 610, 557 N.W.2d 487 (Ct. App. 1996), 95-3295.
807.01 Annotation In sub. (4), “amount recovered” means that portion of a verdict for which a party is responsible. Nelson v. McLaughlin, 211 Wis. 2d 487, 565 N.W.2d 123 (1997), 95-3391.
807.01 Annotation Sub. (1) is procedural in nature and may be applied in federal claims brought in state court unless it defeats a substantial federal right. Duello v. Board of Regents, 220 Wis. 2d 554, 583 N.W.2d 863 (Ct. App. 1998), 97-2608.
807.01 Annotation An insurer has a fiduciary duty to clarify a settlement offer made to the insurer that is ambiguous with respect to whether the offer applies to only the insurer or to both the insurer and the insured. Failure to clarify the ambiguity results in a valid offer under this section. Prosser v. Leuck, 225 Wis. 2d 126, 592 N.W.2d 178 (1999), 97-0686.
807.01 Annotation Sub. (3) provides no exceptions for assessments of double costs. Costs associated with determining coverage are subject to doubling under sub. (3). Prosser v. Leuck, 225 Wis. 2d 126, 592 N.W.2d 178 (1999), 97-0686.
807.01 Annotation The ten-day period in sub. (1) was tolled when a stay was entered one day after a settlement offer was served. Briggs v. Farmers Insurance Exchange, 2000 WI App 40, 233 Wis. 2d 163, 607 N.W.2d 670, 99-1123.
807.01 Annotation A party with multiple claims is not required to itemize a settlement offer in order to invoke the double costs and interest provisions of this section. Batteries Plus, LLC v. Mohr, 2000 WI App 153, 237 Wis. 2d 776, 615 N.W.2d 196, 99-1319.