Gerczak v. Estate of Gerczak6/14/2005
Before Cane, C.J., Hoover, P.J., and Peterson, J.
Edward Gerczak, Jr., appeals a judgment and order that his contested claim against his father's estate for the value of uncashed payroll checks dating from 1990, 2000, and part of 2001 is barred by WIS. STAT.§ 893.44(1), the statute of limitations for actions on unpaid wages. Edward, Jr. argues that these checks represented loans to the family business rather than unpaid wages and that his action is governed not by the two-year statute of limitations for unpaid wages, but the six-to-ten-year limitation for actions on notes, WIS. STAT. § 403.118(2),or the six-year limitation for actions on contracts, WIS. STAT. § 893.43. Edward, Jr. further argues that the court erred when it determined that, under WIS. STAT. § 885.16,the so-called "deadman's statute," his wife Mary Gerczak was incompetent to testify that Edward, Sr. was in the habit of treating payroll checks as loans.
Because we conclude that, for the purposes of WIS. STAT. § 885.16, Mary has a "present, certain, and vested" interest in the outcome of this action,we agree she is disqualified from testifying about any conversations or transactions she had with Edward, Sr. relating to her husband's payroll checks. We also agree that, absent any evidence to the contrary, the uncashed payroll checks represent unpaid wages rather than loans. The judgment and order are therefore affirmed.
Background
During his life, Edward Gerczak, Sr. was the sole proprietor of a business, Allouez Beer & Liquor, Ltd., that he operated with his wife, Vivian Gerczak. Edward, Jr. began working at Allouez part-time while he was in high school. After graduating from high school, Edward, Jr. married and became a full-time Allouez employee. As the years went by, he assumed greater responsibility for the business and his wife, Mary, eventually became Allouez's bookkeeper.
According to Mary, Allouez generally had cash flow problems at the beginning of each year. At other times, Allouez suffered from cash shortfalls because it was required to pay its beer suppliers within fifteen days and its liquor suppliers within thirty days. Mary testified that it was common practice for either Edward, Jr. or Edward, Sr. to hold their payroll checks when cash flow was a problem.
By 1991, Edward, Sr. had developed serious health problems, including arthritis and a heart condition. In 1998, Vivian entered a nursing home. The resulting medical bills placed increased pressure on the family business. As his father's health worsened, Edward, Jr. effectively took over the day-to-day running of Allouez. On January 20, 2003, Edward, Sr. died.
Evidence suggests that Edward, Sr. intended Edward, Jr. to have the business after his death. A revocable trust established in 2002 gave all stock in Allouez Beer and Liquor, Ltd. to Edward, Jr.; the residue of the estate was to be divided between Edward, Jr. and his sister, Barbara. That same year, Allouez was incorporated. Because no assets were ever transferred into the corporation, however, the business passed into the residual estate.
In August 2003, Edward, Jr. filed a claim against his father's estate for $102,011.16 for loans made to Allouez and unpaid wages. He amended his claim in January 2004 to $160, 977.81 plus interest, and again in March, when he claimed $164,056.88 plus interest. Edward, Jr. argued that because the uncashed payroll checks he held represented money loaned to the business, his claim was governed by the six-year statute of limitations for contract actions. Barbara contested his claim.
In August 2004, a hearing on the contested claim was held. Barbara objected
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