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Petta v. ABC Insurance Co.2/24/2005
. Wrongful death plaintiffs John J. Petta and Rachelle DeValk ("John and Rachelle") seek review of a court of appeals decision that concluded (1) they were not entitled to retain damages for medical, funeral, and property damage expenses because they did not pay for these expenses; and (2) the "made-whole" doctrine recognized in Rimes v. State Farm Mutual Automobile Insurance Co., 106 Wis. 2d 263, 316 N.W.2d 348 (1982), did not preclude Travco Insurance Company's ("Travco") subrogation rights because John and Rachelle were not Travco's insureds.
. John and Rachelle argue that equity requires that Rimes and the settlement procedure outlined in Schulte v. Frazin, 176 Wis. 2d 622, 500 N.W.2d 305 (1993), be extended to wrongful death plaintiffs. We agree. Our conclusion is driven by a wrongful death plaintiff's statutory right to waive and satisfy the estate's cause of action in connection with or as part of a settlement and discharge of the claim. A wrongful death plaintiff also has a statutory right to claim and recover medical and funeral expenses on behalf of himself or herself or any person who has paid or assumed liability for such expenses. We acknowledge that a wrongful death relative is not necessarily entitled to retain the proceeds for such claims under the statute unless the relative incurs the costs of those expenses. Nevertheless, because John and Rachelle settled with the tortfeasor for a lump sum of money that Travco stipulated did not make them whole, we conclude that Travco's subrogation rights against the tortfeasor are extinguished. Consequently, we reverse the court of appeals' decision.
I.
. On November 14, 2001, John and Rachelle's mother, Dayle Petta, was killed in an automobile accident caused by Byron Schroeder. Dayle's former husband, Alfred, had an automobile insurance policy issued by Travco that insured Dayle's vehicle, the vehicle she was driving at the time of the accident. Travco paid in excess of $14,000 under its insurance policy for Dayle's funeral and medical expenses and for the damage to the wrecked vehicle.
. Because Dayle was not married at the time of her death, Dayle's surviving adult children, John and Rachelle, commenced a wrongful death action against Schroeder, Whiplash Lake Resort (the owner of the vehicle Schroeder was driving), West Bend Insurance Company (Schroeder's and Whiplash's automobile liability insurer), and three fictitious insurance companies. Believing Travco had a subrogation interest due to the over $14,000 in benefits it already paid, John and Rachelle also named Travco as a nominal defendant pursuant to Wis. Stat. ยง 803.03(2)(a) (2001-02).
. John and Rachelle claimed Schroeder's negligence was a proximate cause of Dayle's death and that as a result they have "incurred expenses relating to the death of their mother" and have been, and will continue to be, "deprived of the society and companionship of their mother." Travco cross-claimed against Schroeder, Whiplash Lake, and West Bend, asserting a subrogation claim for the $14,000 it previously paid.
. In late August 2002, Travco notified the other defendants that John and Rachelle were not its insureds and thus contended that any settlement with or release by John and Rachelle would not bar its subrogation claim. On September 30, 2002, John and Rachelle settled with these other defendants for $280,000 ($250,000 from West Bend and $30,000 from Schroeder), and released and agreed to indemnify them from any of Travco's claims.
. Following the settlement, John and Rachelle moved for a Rimes hearing with Travco and sought an order extinguishing Travco's subrogation rights against the tortfeasor. John and Rachelle
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