Cady v. O'Malley (2026)

Case details
Full caption
Ann K. Cady, Beth L. Corning, and Caron G. Roesler v. Matthew C. O'Malley
Country
United States
Jurisdiction
Wisconsin (WI)
Court
Wisconsin Supreme Court
Decided
2026
Disposition
Dismissed
Majority
Wendy J.n. Klicko, joined by Graham (P.J.), Kloppenburg (J.), Taylor (J.)
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.12026 WL 184862Only the Westlaw citation is currently available.NOTICE: FINAL PUBLICATIONDECISION PENDING. SEE W.S.A. 809.23.Court of Appeals of Wisconsin.Ann K. Cady, Beth L. Corning, andCaron G. Roesler, Plaintiffs-Respondents,v.Matthew C. O'Malley, Defendant-Appellant.Appeal No. 2025AP944|January 23, 2026Cir. Ct. No. 2022CV155APPEAL from an order of the circuit court for Sauk County:WENDY J.N. KLICKO, Judge. Affirmed.Before Graham, P.J., Kloppenburg, and Taylor, JJ.OpinionPER CURIAM.*1 ¶1 Matthew O'Malley appeals a circuit court order thatenforced a settlement agreement he made with his sistersregarding the disposition of real estate and a family-ownedcorporation, and that dismissed this litigation with prejudicepursuant to that agreement. We reject O'Malley’s argumentsand affirm the order of dismissal.BACKGROUND¶2 The plaintiffs, Ann Cady, Beth Corning, and CaronRoesler, and the defendant, Matthew O'Malley, are siblingswho shared ownership of real estate and a family-ownedcorporation called Johnson-O'Malley, Inc. We refer to Cady,Corning, and Roesler collectively as the “sisters”; to the threesisters and O'Malley collectively as the “siblings”; and toJohnson-O'Malley, which is not a party in this litigation, asthe “corporation.”¶3 When this lawsuit was initiated, each of the siblings ownedan undivided one-fourth interest in a parcel of residential realestate in the Village of Lake Delton. Each of the siblings alsoowned one fourth of the shares of the family corporation,meaning that the siblings were its sole shareholders. For itspart, the corporation owned a parcel of commercial real estatethat was adjacent to the residential parcel.¶4 In or around 2021, some or all of the siblings decidedthat the residential and commercial parcels should be sold,ideally to a single buyer. At some point as they prepared for asale, the communication between the siblings broke down andO'Malley, who had been living in a house on the residentialproperty, refused to allow his sisters access to that property.The Pleadings¶5 In April 2022, the sisters initiated this lawsuit andO'Malley counterclaimed. As we discuss in more detailbelow, both sides generally agreed that the real estate shouldbe sold, and both sides asked for a judicially ordered saleof one or both parcels pursuant to WIS. STAT. § 842.02(2)(2023-24).1 However, the sisters and O'Malley disagreedabout how the proceeds of the sale should be split betweenthe siblings.¶6 In their complaint, the sisters sought an injunction againstO'Malley that would grant the sisters access to the residentialproperty and require O'Malley to move out. They also soughtan order for the judicial sale of the residential property, whichwould be followed by a court-ordered equitable division ofthe proceeds. According to the sisters’ request for relief,the distribution of sale proceeds to O'Malley should bereduced based on “contributions” that the sisters made to theresidential real estate and reductions in the value of the realestate that the sisters attributed to O'Malley, and also based onthe theory of unjust enrichment because O'Malley had been“living rent free” in the house on the residential property.¶7 In his answer, O'Malley denied that he owed any rentfor the residential property. He affirmatively alleged that anyreduction in its value was due to mismanagement by hissisters.¶8 O'Malley also filed two counterclaims: one for unjustenrichment and a second for a judicial sale. As for unjustenrichment, O'Malley alleged that the sisters had beenunjustly enriched by the efforts he had undertaken to managethe residential property and the business on the commercialproperty, and he sought the value of the services that he hadprovided for both properties. As for the request for a judicial
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.2sale, O'Malley sought the sale of not only the residentialproperty but also the commercial property, and he took theposition that the net proceeds should be divided equallyamong the parties.*2 ¶9 In their response to the counterclaims, the sistersdenied that O'Malley was entitled to any compensation. Theyaffirmatively alleged that he had taken insurance money forthe residential property for his own personal use and operatedhis own business out of the commercial property.¶10 In February 2023, O'Malley’s first set of attorneys movedto withdraw as counsel, citing a substantial breakdown incommunication on the substantive issues relating to the case.The circuit court did not enter an order allowing the attorneysto withdraw until a month later, after the siblings had enteredinto a settlement agreement but before they followed throughon the settlement by asking the court to dismiss the litigation.As discussed below, O'Malley would go on to retain and thendischarge two more sets of attorneys during the course of thepost-settlement phase of the litigation.The Settlement¶11 The siblings entered into a written settlement agreementon March 3, 2023. As we understand it, a significant impetusfor the agreement was that there had been an offer to purchasethe residential and commercial real estate and some or allof the siblings wanted to accept that offer. As we describein greater detail below, the written settlement agreementmemorializes an agreement to sell the real estate, to resolvethe claims between the siblings, to distribute the proceedsof the real estate sale, to transfer full ownership of thecorporation to O'Malley, and to dismiss this litigation. Thesiblings and the corporation were party to the agreement,which was signed on March 3, 2023, by each of the siblingsand by one of the sisters, Ann Cady, on behalf of thecorporation as its president. We sometimes refer to thesiblings and the corporation collectively as the “settlingparties.”¶12 As for the real estate, the settlement agreement providedthat both parcels would be sold pursuant to the terms of thepurchase offer, which was incorporated into the agreement.2The agreement further provided that, if the closing did notoccur “due to factors out of the control of the parties,” thesettlement agreement would be “null and void in its entirety.”¶13 The settlement agreement resolved various disputesbetween the siblings about who was owed money and whowould be responsible for certain corporate debts, and it alsoprovided that O'Malley would assume sole ownership ofthe corporation. For his part, O'Malley agreed that upon theclosing of the real estate sale, he would make a payment toCady to pay off a personal loan, he would resolve a specifiedjudgment and certain debts that constituted liens on the realestate, and he would be responsible for specified utility billsand certain credit card and corporate debts. For the sisters’part, they agreed to make a payment to O'Malley, to paycertain utility and legal bills owed by the corporation, and tosurrender their roles, shares, and interests in the corporationto O'Malley, “thus giving O'Malley 100% ... ownership.”3*3 ¶14 The settlement agreement also included a mutualrelease. Generally speaking, the settling parties released eachother from “any and all liability, claims, counterclaims,damages, remedies, and causes of action, of any kind ornature, ... known or unknown, that existed or may have existedon or before the date of this Agreement relating to the SubjectProperties, the Corporation, or the relationship between theParties.” The release was qualified in that it did not “bar anyclaim of the Corporation or [the sisters] against O'Malley fordebts incurred on behalf of the Corporation that are unknownto the Corporation or [the sisters],” nor did it “bar any claimof the Corporation or O'Malley against [the sisters] for debtsincurred on behalf of the Corporation that are unknown to theCorporation or O'Malley.”¶15 Each of the settling parties expressly acknowledgedthat the written settlement agreement constituted the “entireagreement and understanding between the Parties.” Theyfurther acknowledged that no other party had “made anystatement, promise, representation, or warranty whatsoever ...not contained within this Agreement to induce [the settlingparty] to execute this Agreement,” and that they hadnot executed the agreement “in reliance on anything notcontained” in the agreement.¶16 Finally, the parties agreed to dismiss the lawsuit.The settlement agreement provided: “Upon the completeexecution of this Agreement, which contemplates the closingof the Sale, the Parties shall then file a stipulation andproposed order for dismissal of the Lawsuit with the Court.”¶17 In mid-March 2023, the sisters’ attorney filed a letter toinform the circuit court of the settlement. Counsel anticipatedthat a stipulation and order to dismiss would be filed in
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.3May. However, no stipulation was forthcoming. Meanwhile,as noted, after receiving the notice of settlement, the courtallowed O'Malley’s first set of attorneys to withdraw.The Closing¶18 The closing of the real estate transaction occurred onJune 15, 2023, with the two parcels of real estate selling for$1,000,000. Prior to the closing, the parties worked with aclosing agent to determine how the sale proceeds would bedivided. Each of the siblings would receive an equal share ofthe sale proceeds, which would then be adjusted to accountfor the other payments and liabilities that were resolved inthe settlement agreement. For his part, O'Malley’s share ofthe sale proceeds was adjusted upward to account for thesettlement payment from the sisters, and then downward toaccount for the loan payoff to Cady and the payments of otherdebts and liabilities that O'Malley assumed in the settlementagreement. A “closing statement” prepared by the closingagent memorialized the dollar value of the distributions toeach of the siblings, and the statement was signed by each ofthe siblings and by Cady on behalf of the corporation.¶19 The closing agent also prepared tax documents (Form1099-S) for the siblings and the corporation. The 1099sreflected that each of the siblings received a quarter shareof the sale proceeds (that is, $250,000) from the real estatetransactions and that the corporation received $0. Each of thesiblings signed his or her 1099, and Cady signed the 1099for the corporation. When later questioned at an evidentiaryhearing, the closing agent testified that the direction on how todistribute the proceeds came from meetings with the siblings,and the siblings’ agreement was evinced in the signed closingstatement and the 1099s.¶20 Following the closing and the distribution of the saleproceeds, the sisters’ attorney prepared documents that wouldtransfer the sisters’ shares of the corporation to O'Malleyand a stipulation that would dismiss the lawsuit. O'Malleyrefused to accept the shares unless the sisters turned overcorporate documents and provided an “accounting” of thecorporation's finances. The sisters provided documents, butO'Malley refused to accept them and refused to sign thestipulation for dismissal.The Motion to Enforce the Settlement Agreement*4 ¶21 In July 2024, the sisters filed a motion asking thecircuit court to enforce the settlement agreement and dismissthe lawsuit. Although the motion was styled as a “motion todismiss,” it was not a motion based on a defense set forth inWIS. STAT. § 802.06(2)(a), nor was it a motion for summaryjudgment. Instead, it was effectively a motion seeking specificperformance of the settlement agreement, which would resultin the dismissal of the lawsuit.¶22 In the motion, the sisters represented that all of the termsof the settlement agreement “have been satisfied or resolvedexcept that” O'Malley had “failed to accept” ownership of thecorporation. The sisters represented that they had attemptedto transfer their shares to O'Malley, but he refused to acceptthem. The sisters also represented that they had offered, in thealternative, to dissolve the corporation. However, O'Malleyhad “not agreed to any proposed solution and ha[d] notproposed any solution to dismiss the matter.”¶23 O'Malley, who was at this time represented by asecond set of attorneys, filed a brief opposing dismissal.In that brief, O'Malley argued that the sisters had failed toestablish that two of the settlement agreement's “conditions[of] dismissal ... ha[d] been met.” More specifically, heasserted, “the allocation of liabilities for capital gains taxeson the sale proceeds” were “at variance from the terms ofthe closing,” and the sisters had not provided “the books,accounts and records of [the corporation] in up-to-date andmerchantable form.” On the latter point, O'Malley asserted,he was uncertain whether the documents that had been turnedover were complete, and he objected to “being asked to takedelivery of corporate records and indicia of ownership withno opportunity to verify their completeness or accuracy.”¶24 Additionally or perhaps in the alternative, O'Malleyargued that the terms of the settlement agreement were“so contingent” that the agreement “is of questionableenforceability,” and also that the agreement was “notsufficiently definite to be enforced.” O'Malley asserted thatthe parties should have included additional terms in theiragreement—“[t]he real estate closing and its subsequent taxreporting should have been defined by precise terms” inthe settlement agreement, and “[t]he corporate assets shouldhave been inspected, exceptions to their suitability noted,and the problems cured,” presumably prior to executing thesettlement agreement.¶25 A motion hearing was scheduled for September 2024. Bythat time, O'Malley had discharged his second set of attorneys
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.4and was represented by a third set. There is no transcript of theSeptember 2024 hearing in the record, nor is there any writtenorder memorializing the results of that hearing. Based onlater representations by the circuit court and the siblings, weunderstand that O'Malley raised concerns about the corporatedocuments he had received, and the sisters offered to provideall documents in their possession. Consistent with that offer,the court ordered the sisters to provide the documents andordered O'Malley to accept them, and it gave O'Malley 60days to review the documents and to decide whether he wasmaintaining his objection to dismissal of the lawsuit.¶26 In December 2024, O'Malley’s third set of attorneyswrote to inform the circuit court that O'Malley had reviewedthe documents that had been provided and continued toobject to the lawsuit being dismissed. The letter stated that,“[a]mong other things, the documents evidence that the[sisters] failed to comply with material terms of the settlementagreement, and that those failures may constitute groundsfor invalidation or rescission of the parties’ agreement.” Theletter did not identify any particular term that the sisters failedto comply with, nor did it identify any facts that would supportinvalidation or rescission of the settlement agreement. Theletter instead asked for a status conference to establish “anappropriate scheduling order addressing additional discovery(to the extent the court will permit it) and briefing.”*5 ¶27 At the same time, O'Malley’s third set of attorneysmoved to withdraw from the case, citing “[f]undamentaldisagreements” that had “arisen between [O'Malley] andhis counsel such that continued representation would beunreasonably difficult ....” Counsel's motion asserted that“[w]ithdrawal may be accomplished without material adverseeffect to the defendant, the other parties to this matter, or the[circuit] court.” The court did not at that time enter an orderallowing the third set of attorneys to withdraw.¶28 Shortly thereafter, O'Malley filed a pro se motion anda pro se brief opposing the pending motion to enforce thesettlement agreement. In the pro se motion, O'Malley citedhis right to self-representation and asked the circuit court toallow him to proceed pro se. In so doing, he “affirm[ed] that heunderst[ood] the responsibilities and obligations associatedwith self-representation, including compliance with courtrules and procedures.” O'Malley also asked the court to“[a]dmit and consider” his pro se brief as a supplement tothe brief that had been previously filed by his second set ofattorneys.¶29 O'Malley’s supplemental brief was lengthy and attimes difficult to track, but we summarize its argumentsas we best understand them.4 According to O'Malley, thesettlement agreement was “invalid” because O'Malley hadnot meaningfully participated in the negotiation; because thesisters and their attorney unilaterally imposed certain terms;because the sisters’ attorney had previously represented thecorporation which created a “conflict of interest”; and becauseO'Malley signed the agreement under “undue influence” or“duress.” Dismissal pursuant to the settlement agreement wasalso “premature” because the agreement contemplated thatthe lawsuit would not be dismissed until “execution” of theagreement was “complete,” and that had not yet occurredbecause corporate ownership had not been transferred toO'Malley.¶30 O'Malley’s supplemental brief also asserted that he wasunwilling to accept the transfer of his sisters’ shares in thecorporation because there were a number of “unresolvedissues” about how the corporation had been managed thatpredated the 2023 settlement, including issues with corporaterecordkeeping and transparency. According to O'Malley, thecorporate documents that had been provided were inadequateand left lingering questions. Specifically, O'Malley couldnot verify the sisters’ representation that the corporationhad no assets after the real estate was sold, nor could heverify whether it had additional undisclosed liabilities thatcould offset the benefits of full ownership, rendering thesettlement agreement “inequitable.” Some of the “unresolvedissues” that O'Malley identified in his supplement were alsothe subject of O'Malley’s counterclaims, and he argued thathe potentially had other unpled claims such as breach offiduciary duty that he might wish to pursue against his sisters.*6 ¶31 Additionally, O'Malley’s supplemental briefpresented his concerns about decisions that the sisters hadpurportedly made after the settlement agreement was signed.One of these decisions had something to do with thepreparation of a schedule 5K-1 tax form which, O'Malleyasserted, was not consistent with the “property allocationvalues agreed to and executed at the 15 June 2023 closing.”Another decision concerned a purported quit claim ofcorporate real estate to Sauk County. O'Malley asserted,among other things, that he was entitled to certain disclosures,including a detailed list of all contracts that the sisters enteredinto on behalf of the corporation since 2020.¶32 The circuit court scheduled a telephone motion hearing toaddress the motion to withdraw filed by O'Malley’s third set
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.5of attorneys. On January 7, 2025, the morning of the hearing,O'Malley filed a pro se motion that appeared to reverse courseon his request to represent himself—O'Malley instead askedthe court to “delay any subsequent hearings” to give timefor “still missing corporate records” to be provided and “toallow [O'Malley] time to secure replacement counsel and toreview corporate records necessary to properly respond to thepending matters.”¶33 The telephone motion hearing took place as scheduled onJanuary 7, 2025. The circuit court acknowledged O'Malley’srequest for additional time to retain replacement counsel andreview corporate records, but it expressed concern aboutthe length of time that the case had been pending and thefact that the sisters’ attorney planned to leave his law firmafter the end of the month. After confirming that all of thecorporate documents that had been provided to O'Malley’scounsel had been turned over to O'Malley, the court grantedcounsel's motion to withdraw. The court agreed to postponethe evidentiary hearing on the sisters’ pending motion untilJanuary 31, but no later, and stated that if O'Malley wantedto be represented by counsel at the hearing, O'Malley wouldhave to retain counsel before the hearing date.The Evidentiary Hearing¶34 The evidentiary hearing proceeded as scheduled onJanuary 31, 2025. O'Malley had not retained replacementcounsel and represented himself.¶35 At the start of hearing, the circuit court reviewedthe posture of the litigation between the siblings, and itidentified what had been addressed and what remained to beaddressed in the litigation as follows. The sisters’ complaintand O'Malley’s counterclaim had each sought judicial sale ofthe real estate, but that relief was not something the courtcould order given that the real estate no longer belonged tothe settling parties. And, although O'Malley had also fileda counterclaim for unjust enrichment, the counterclaim hadbeen resolved through the settlement agreement. Specifically,the siblings had agreed that the disbursements from thereal estate sale would “resolve” their competing claims“about the other being unjustly enriched.” Accordingly,O'Malley’s counterclaim need not be further addressed,assuming that the settlement agreement was enforceable.Under these circumstances, there were no remaining claims orcounterclaims in the lawsuit left to adjudicate, and the focus ofthe evidentiary hearing would be on whether the court shouldorder enforcement of the settlement agreement, which wouldresult in the dismissal of the lawsuit.¶36 When asked whether he agreed with the circuitcourt's summary of the remaining issues in the litigation,O'Malley again brought up concerns about missing corporatedocuments, and the court questioned the sisters’ attorneyabout whether all known corporate documents had beenprovided to O'Malley. Counsel represented that, based on hisconversations with the sisters, all known corporate recordsin their possession had been turned over, and O'Malleyresponded that he had not received documents such as“corporate minutes from many major decisions that weremade after the settlement agreement.” Counsel maintainedthat the existing records had been turned over, and suggestedthat O'Malley was raising a different question about whether“corporate records weren't properly kept.” Based on thisdiscussion, the court stated that “there isn't anything more forthe court to order at this time.”*7 ¶37 The closing agent testified at the hearing, and hertestimony was consistent with the facts set forth above: allfour siblings had agreed to the division of sale proceedsthat was represented in the closing statement; the proceedswere disbursed consistent with that statement; and the 1099tax forms accurately reflected that all of the proceeds weredistributed to the siblings and none to the corporation. Theclosing agent further testified that the siblings all agreed thatCady should sign the paperwork on the corporation's behalf.¶38 O'Malley also testified at the hearing. Although the circuitcourt gave some latitude to O'Malley to present his case,the court also sustained objections and redirected O'Malley’stestimony when it determined that O'Malley was veeringinto topics that were irrelevant to the enforceability of thesettlement agreement, which was the only remaining issuein the litigation. We describe O'Malley’s testimony in somedetail, as it provides helpful context to his arguments onappeal.¶39 During his testimony, O'Malley made a numberof admissions about the circumstances surrounding thenegotiation and execution of the settlement agreement.Among other things, O'Malley admitted that the siblings haddiscussed dissolving the corporation as part of the settlement,but that he had specifically asked that the ownership ofthe corporation be transferred to him instead. He alsoadmitted that he signed the settlement agreement, the closingpaperwork, and his 1099; that the real estate had been sold and
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.6the proceeds had been disbursed; and that the disbursement ofsale proceeds and 1099s were consistent with the settlementagreement. In O'Malley’s view, the transfer of ownership wasthe only portion of the settlement agreement that had not beencompleted.¶40 O'Malley further testified that he believed that he wasthe sole owner of the corporation pursuant to the settlementagreement. However, in his view, ownership “hasn't beenproperly transferred” because his sisters had not provided afull accounting of its assets and liabilities. When asked toidentify a provision in the agreement that required specificdocumentation to be provided, O'Malley pointed to theprovision that stated: “[The sisters] agree at Closing tosurrender any and all Johnson-O'Malley roles, shares andinterests over to O'Malley, thus giving O'Malley 100% ...ownership.” As we best understand O'Malley’s testimony,the point he was attempting to convey was that his 100%ownership included ownership of all corporate records andthat, “according to Wisconsin business law,” the transfer isnot complete until records are provided.¶41 During his testimony, O'Malley also asserted that he hadnot wanted to agree to the terms of the settlement agreementand was under “undue influence” to sign it. More specifically,he testified that he had wanted the property to be partitionedrather than sold, but he “was told that if [he] didn't sign theagreement” the corporation might lose its liquor license, “thebuyer might walk,” the lost value “would come out of ...[his] ownership proceeds,” and the house on the residentialproperty would likely be condemned. When asked how thosefacts amounted to undue influence, O'Malley testified that thesituation “created a sense of urgency that wouldn't be thereotherwise.”¶42 O'Malley also testified that, in his view, it was “highlyinappropriate” for the corporation to be included as a partyto the settlement agreement. According to O'Malley, thecorporation had not been included until the sisters’ attorneyadded it as a party to the settlement agreement at the “lastminute.” O'Malley asserted that the attorney must have beenrepresenting the corporation as well as his sisters during thesettlement negotiations, and that the attorney continued torepresent the corporation after the closing occurred.*8 ¶43 In addition, O'Malley’s testimony touched on hisconcerns about poor corporate recordkeeping practices over aperiod of 20 years, and he asserted that the corporation mighthave liabilities that he was unaware of for which he would beresponsible.¶44 Finally, O'Malley also vaguely alluded to events that,he suggested, had occurred after the closing. Specifically, hetestified, “my understanding is they [the sisters, presumably]made a huge shift for their tax benefits that greatly harmedme,” and “my understanding is they flipped it and suddenlythere was $700,000 put on the corporation that wasn'tthere.” O'Malley did not introduce evidence to support theseassertions.¶45 The circuit court determined that the siblings hadvoluntarily entered into the settlement agreement, and thatit was enforceable. Therefore, the court ordered specificperformance of the remaining provisions of the agreement—namely, that all shares of the corporation belonged toO'Malley as of the date of the closing, and the dismissal ofthe lawsuit.¶46 The circuit court made the following factual and legaldeterminations in support of its ruling. The settlementagreement was signed by all of the siblings and by Cady onbehalf of the corporation. The agreement contemplated a fullresolution of all of the issues in the lawsuit, including themanner in which the sale proceeds would be divided after theclosing. All of the events contemplated by the agreement hadoccurred. The settling parties had all agreed that the numbersin the closing statement were correct, and the proceeds weredisbursed according to that statement. The parties also signedthe 1099s consistent with their prior agreement.¶47 The circuit court also determined that the facts thatO'Malley testified to regarding a “sense of urgency” did notamount to undue influence or duress. As the court explained,“urgency certainly plays a part in all kinds of businessdealings,” especially in real estate transactions. However, it“is not a threat” to discuss the “potential outcomes” of notreaching an agreement—it is instead a natural part of thenegotiation process, which includes “providing information”so that the parties can make “a reasoned decision ... aboutwhether to go forward or not.” If O'Malley had questionsabout corporate recordkeeping or other matters, he shouldhave resolved his questions before signing the settlementagreement.¶48 The circuit court entered an order that dismissed allclaims and counterclaims with prejudice and ordered thatall “roles, shares, and interests [in Johnson O'Malley, Inc.]
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.7are transferred from [the sisters] to [O'Malley], giving[O'Malley] 100% ownership effective June 15, 2023.”O'Malley appeals.5DISCUSSION*9 ¶49 There is no dispute that, during the course ofthis litigation, O'Malley signed a settlement agreement thatexpressly provided that it was intended to be a full settlementof all claims that were or could have been brought in thelitigation. The agreement, which was not contingent on anyfuture event except the closing of the real estate sale, wasmade in writing and subscribed by each party; therefore,the statutory requirements for a binding and enforceablesettlement agreement are satisfied. See WIS. STAT. § 807.05;see also Affordable Erecting, Inc. v. Neosho Trompler, Inc.,2006 WI 67, ¶¶22-24, 28, 291 Wis. 2d 259, 715 N.W.2d 620(interpreting § 807.05).6¶50 On appeal, O'Malley makes a number of arguments aboutwhy the circuit court should not have enforced the settlementagreement, which called for the dismissal of the lawsuit. Hisarguments are at times difficult to parse, only some of themwere raised during the circuit court proceedings, and many arenot supported by citations to the record or legal authority. Wenow consider O'Malley’s arguments as best as we understandthem.¶51 We begin with O'Malley’s arguments about purportedlyunfilled “conditions precedent” to the dismissal of the lawsuit.Whether the conditions precedent to the enforcement ofa settlement agreement have been fulfilled involves bothquestions of law (what the agreement requires) and questionsof fact (whether those things occurred as the agreementrequires). Schlosser v. Allis-Chalmers Corp., 86 Wis. 2d226, 244, 271 N.W.2d 879 (1978) (the meaning of anunambiguous contract is a question of law); Smith RealtyCo. v. Zimmerman, 75 Wis. 2d 11, 17, 248 N.W.2d 472(1977) (whether a party's activities constitute performance ofits obligations under a contract may present a question offact).¶52 O'Malley argues that the circuit court erred by dismissingthe lawsuit pursuant to the settlement agreement withoutregard to whether the conditions precedent to dismissalhad been satisfied. Specifically, O'Malley contends, thoseconditions were “the proper transfer of corporate ownership”and “an honest allocation of the sale proceeds,” which,O'Malley asserts, “did not occur.” “[A]t minimum,” O'Malleyargues, the court should have “held an evidentiary hearingon whether the settlement conditions were met” but thecourt “instead ... enforced the [settlement] agreement withoutinquiry.”¶53 This argument is ahistorical—as noted, the circuit courtdid hold an evidentiary hearing, and during the hearing itgave explicit consideration to whether everything that theagreement contemplated happening prior to dismissal hadoccurred. The court found that everything the agreementcontemplated had indeed occurred, and O'Malley doesnot persuade us that the court erred with respect to anydetermination on these points.¶54 To illustrate, regarding the first alleged conditionprecedent—the transfer of corporate ownership—the circuitcourt found that the sisters had attempted to transfer theirshares to O'Malley. The court also implicitly found thatO'Malley did not have any valid reason to refuse to accepttheir shares. Therefore, the court ordered that the corporationbelonged to O'Malley as of the date of the closing, thusfulfilling that aspect of the settlement agreement.*10 ¶55 Although O'Malley continues to argue that noproper transfer of corporate ownership occurred, his argumentis unsupportable. The argument appears to be based on hisassertion that the sisters have not given him certain corporatedocuments that may or may not exist. However, O'Malleydoes not point to any provision of the settlement agreementthat contemplated an exchange of documents. That omissionis telling—although the court ordered the sisters to producethe records in their possession after they offered to do so, therewas nothing in the settlement agreement that required anyparticular records or documents to be provided. Therefore,there was no unfulfilled condition precedent regarding thetransfer of corporate ownership.7¶56 Regarding the second alleged condition precedent,the allocation of sale proceeds, the circuit court foundthat the proceeds were disbursed in accordance with thesettlement agreement and the closing statement, which hadbeen approved by O'Malley. O'Malley does not argue thatthis finding is clearly erroneous, nor does he dispute that heactually received his share of the proceeds, as reflected inthe closing statement. Therefore, to the extent that the properdisbursement of sale proceeds was a condition precedent ofdismissal, that aspect of the settlement agreement was alsofulfilled.
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.8¶57 O'Malley makes arguments about the sale proceeds onappeal, but his concern does not appear to be about how thenet proceeds were disbursed (that is, all to the siblings andnone to the corporation). Instead, as best as we understandit, his concern appears to be that, following the closing, aportion of the lump sum payment for the real estate may havebeen attributed to the commercial parcel that had been ownedby the corporation. O'Malley contends that this attributionof value has tax consequences and his concern may or maynot be valid as an accounting and tax matter, but it is whollyirrelevant to the issue here. The issue is whether there wereany remaining conditions that had to be fulfilled before thelitigation was dismissed pursuant to the settlement agreement,and there were no terms in that agreement that addressed thetax consequences of the real estate transaction. Nor were thereany terms that addressed how the payment should be allocatedbetween the two parcels that were included in the real estatesale. Therefore, O'Malley has not identified an unfulfilledcondition precedent to dismissal pursuant to the settlementagreement.*11 ¶58 We now turn to O'Malley’s numerous argumentsabout the sisters’ pre-settlement actions with respect tomanaging the corporation. In continuing to advance thesearguments, O'Malley does not come to grips with the factthat he signed a settlement agreement that resolved all of theclaims he had raised in the litigation and that also includeda mutual release. Accordingly, the sisters’ presettlementactions are no longer relevant for purposes of this litigationunless there is some reason that the settlement agreement isunenforceable.¶59 O'Malley makes several arguments about why thesettlement agreement is unenforceable which we nowconsider and reject.¶60 To the extent that O'Malley renews an argument aboutundue influence or duress, the circuit court determined thatthe facts O'Malley testified to did not amount to either.O'Malley does not develop an argument as to why thatdetermination is erroneous. He does make some assertionsabout being under “pressure from multiple directions,”about the quality of representation he received from hisattorney during settlement negotiations, and about the sisters’attorney's “last-minute” insistence that the corporation beincluded in the settlement agreement and its mutual release,but he does not attempt to pair those arguments with theelements of either legal doctrine.8¶61 Instead, O'Malley makes new arguments about allegedfraudulent inducement or alleged material breaches of thesettlement agreement. Although O'Malley discussed thesisters’ pre- and post-closing conduct in detail in his circuitcourt filings, he did not develop any theory based onfraudulent inducement or material breach in the argumentshe made in the circuit court. We could disregard O'Malley’sargument on that basis,9 but we choose to further addressthose arguments for completeness.¶62 Beginning with fraudulent inducement, for O'Malley’sargument to have any merit, there would have to be factsshowing that the sisters engaged in fraudulent conduct beforethe settlement agreement was executed. Kaloti Enterprises,Inc. v. Kellogg Sales Co., 2005 WI 111, ¶42, 283 Wis. 2d555, 699 N.W.2d 205 (“[t]o invoke this narrow fraud inthe inducement exception,” the misrepresentation must occur“before the contract was formed”). Here, there were no factsidentified in O'Malley’s circuit court filings or that wereadduced at the hearing that would support an argument thatfraudulent conduct occurred before the settlement agreementwas executed. To be sure, O'Malley’s pro se supplementalbrief in opposition to dismissal asserted that there were“serious concerns of potential fraud” with respect to post-closing documentation that allocated the purchase pricebetween the two parcels of real estate, but O'Malley failsto explain how post-closing conduct that occurred after thesettlement agreement was signed could have induced him tosign the agreement.*12 ¶63 As for O'Malley’s argument that the sistersmaterially breached terms in the settlement agreement, thereare several significant problems. Most notably, O'Malley hasnot identified any conduct by the sisters that would constitutea material breach of any term in the settlement agreement.As mentioned, the agreement did not require the sisters toprovide any particular documents, and did not address howthe purchase price would be allocated between the parcelsof real estate. To the extent that O'Malley or the corporationcould potentially have a legal claim against someone orsomething with respect to any pre- or post-closing actions,including how the settlement proceeds were reported for taxpurposes, he does not identify any legal theory under whichthat potential claim would prevent the settlement agreementfrom being enforced.10¶64 Separately, O'Malley also makes some arguments aboutthe propriety of the role that the attorney who represented
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.9his sisters played in the litigation. Specifically, O'Malleyasserts that the attorney was engaged in “dual representation”because he was “speaking for the corporation” as wellas his sisters during the settlement negotiations, and thatthe attorney continued to represent the corporation in thelitigation that occurred after the settlement agreement wassigned. O'Malley argues that the attorney “claimed torepresent a company they no longer owned—against theinterests of its sole shareholder,” and he suggests that thecircuit court erred by not requiring “proof of [the attorney's]authority to represent the corporation post-closing.”¶65 These arguments fail because, among other things, theyare not supported by the record. Most notably, O'Malley doesnot identify any occasion during this litigation in which theattorney who represented the sisters purported to representor speak for the corporation. O'Malley asks us to infer thatthe attorney must have been representing the corporation'sinterests, rather than the sisters’ interests, because the attorneyinsisted that the corporation be included as a party to thesettlement agreement and because the attorney argued againstsome of the requests that O'Malley made in the circuitcourt, but that inference does not hold up. The sisters, whohad been corporate shareholders and had participated in itsmanagement, would have had good reasons to want thecorporation to be included in the settlement agreement sothat O'Malley, who would control the corporation after theclosing, would be precluded from bringing claims againstthem on the corporation's behalf. And the sisters would alsohave had a personal stake in wanting the litigation to bedismissed. The fact that the sisters’ attorney pushed for thesepositions in and out of court is not proof that the attorney wasrepresenting the corporation rather than or in addition to thesisters in this litigation.11*13 ¶66 Finally, O'Malley makes a series of due processarguments about how his right to be heard was violatedby the “truncated” proceedings held by the circuit court.Specifically, O'Malley takes issue with the fact that the courtlimited the time devoted to the evidentiary hearing, sustaineda number of objections to the relevance of evidence he wantedto offer, and dismissed the case even though, O'Malley asserts,a number of O'Malley’s motions remained “unresolved.”None of these arguments have merit.¶67 O'Malley’s assertion that he had pending motions thatwere not resolved prior to dismissal is not borne out in therecord.12 O'Malley may mean to argue that the circuit courtdismissed the litigation without addressing every argumentthat O'Malley wanted the court to address, but he has notidentified any reason that the court was required to addressthese arguments, given the court's determination that therewas an enforceable settlement agreement that called fordismissal of the litigation. It was also within the court'sdiscretion to exclude irrelevant evidence that went beyond thescope of the hearing, and we agree with the court's view onthe proper scope of the hearing. The additional evidence thatO'Malley wanted to offer may have been relevant to a numberof potential claims that O'Malley would have liked to bringagainst his sisters, but it was not relevant to the narrow issuebefore the court, which was whether the settlement agreementshould be enforced. Finally, regarding the two-hour time slotthat the court devoted to the evidentiary hearing, it is within acircuit court's discretion to schedule proceedings in a mannerthat balances the need of any one case against the needs ofothers. See Hefty v. Strickhouser, 2008 WI 96, ¶31, 312 Wis.2d 530, 752 N.W.2d 820 (“circuit courts have discretion tocontrol their dockets”). Here, we are not persuaded that thecourt erred by allotting two hours for the hearing, especiallygiven the narrow issue that was before the court.13*14 ¶68 For all of the above reasons, we conclude that thecircuit court did not err in enforcing the settlement agreementand dismissing this litigation with prejudice pursuant to thatagreement.By the Court.—Order affirmed.This opinion will not be published. See WIS. STAT. RULE809.23(1)(b)5.All CitationsSlip Copy, 2026 WL 184862Footnotes
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.101All references to the Wisconsin Statutes are to the 2023-24 version.2The offer to purchase and its addendum were not included in the documents filed in the record. There is noargument that the details of those documents are material to this appeal.3The settlement agreement also included provisions about how some personal property would be distributed,but those provisions are not at issue here.4By attempting to summarize the arguments O'Malley made in his pro se motion and supplemental brief inopposition, we do not mean to suggest that the circuit court was required to consider them, given that O'Malleywas represented by counsel when the motion and brief were filed. See Johnson v. Johnson, 2016 WI App60, ¶26, 371 Wis. 2d 388, 885 N.W.2d 603 (declining to consider a pro se motion filed by a litigant whenthe litigant was represented by counsel at the time of the pro se filing); State v. Debra A.E., 188 Wis. 2d111, 138, 523 N.W.2d 727 (1994) (addressing the concept of “hybrid” representation, and providing that anappellate court may but need not consider pro se briefs filed by a represented appellant).5The briefs and appendices filed in this appeal violate various provisions of the rules of appellate procedurefound in WIS. STAT. ch. 809.First, the brief and appendix that the sisters filed and the reply brief and appendices that O'Malley filed donot comply with WIS. STAT. RULE 809.19(8)(bm), which addresses the pagination of appellate briefs andappendices. See RULE 809.19(8)(bm) (providing that, when paginating briefs, parties should use “Arabicnumerals with sequential numbering starting at ‘1’ on the cover”). This rule was amended to its current formin 2021, see S. CT. ORDER 20-07, 2021 WI 37, 397 Wis. 2d xiii, and the reason for the amendment is thatbriefs are now electronically filed in PDF format, and are electronically stamped with page numbers whenthey are accepted for efiling. The pagination requirements ensure that the numbers on each page of a brief“will match ... the page header applied by the eFiling system, avoiding the confusion of having two differentpage numbers” on every page of a brief. Supreme Court Note, 2021, RULE 809.19.Second, O'Malley’s appendices also include some documents that were not filed during the circuit courtproceedings and are not included in the record on appeal. We disregard these documents because ourappellate review is limited to the record on appeal, which contains only those documents that were presentedduring the circuit court proceedings. See State ex rel. Wolf v. Town of Lisbon, 75 Wis. 2d 152, 155-56,248 N.W.2d 450 (1977).Third, although WIS. STAT. RULE 809.19(1)(d) and (e) require appellate briefs to contain appropriatereferences to the record and citation of supporting legal authorities, O'Malley’s briefing contains a number offactual assertions that are not paired with any reference or citation to any portion of the record and a numberof assertions about the law that are not paired with citations to legal authority. It is within our discretion todisregard such factual and legal assertions as unsupported. See State v. Pettit, 171 Wis. 2d 627, 646-47,492 N.W.2d 633 (Ct. App. 1992) (a court need not consider arguments that are unsupported by legal citationsor are otherwise undeveloped).Finally, and most troublingly, O'Malley’s briefs also include false legal citations. Specifically, some of thecitations in his briefs are to legal authorities that do not exist, and other citations are to legal authoritiesthat exist but are wholly unrelated to the proposition for which they are cited. The inclusion of false legalcitations in O'Malley’s briefing violates WIS. STAT. RULE 809.19(1)(e) and (4)(b). The sisters pointed outthese false citations in their respondents’ brief, but O'Malley did not acknowledge the error in his reply briefand instead continued to use the same false citations. This is a significant violation of court rules; accordingly,we considered whether, on our own motion, to order O'Malley to show cause why he should not be sanctionedfor the false citations pursuant to RULE 809.19(2), which provides broad authority to issue sanctions for a
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.11failure to comply with this court's rules. In the end, we decline to issue such an order in favor of a promptresolution of this appeal. But we caution O'Malley not to repeat this violation in any future filings in this or anycourt. We offer an additional note of caution—if the root of the problem is that O'Malley used generative AIfor legal research and trusted it to provide accurate results, he should be aware that there are many reportedinstances in which generative AI has hallucinated nonexistent cases and misreported the holdings of existingcases.6WISCONSIN STAT. § 807.05 provides: “No agreement, stipulation, or consent between the parties or theirattorneys, in respect to the proceedings in an action or special proceeding shall be binding unless made incourt ... and entered in the minutes or recorded by the reporter, or made in writing and subscribed by theparty to be bound thereby ....” Whether a settlement agreement is enforceable under this statute is a questionof law that we review de novo. Waite v. Easton-White Creek Lions, Inc., 2006 WI App 19, ¶5, 289 Wis.2d 100, 709 N.W.2d 88 (2005).7Indeed, rather than arguing on appeal that the settlement agreement required the transfer of any specificdocumentation, O'Malley points to the statutory provisions in WIS. STAT. §§ 180.1602-1604 that govern ashareholder's right to inspect corporate records and a corporation's statutory responsibilities with respect to ashareholder's written notice for an inspection of corporate records. There are several independent problemswith any argument O'Malley might be making about these statutes. First, O'Malley did not make any argumentbased on §§ 180.1602-1604 during the circuit court proceedings. Second, he does not specifically identifyany notice that he sent to the corporation's registered agent, as required by § 180.1602(2)(c) and WIS. STAT.§ 180.1150(1)(c). Third, § 180.1604 addresses a shareholder's recourse against a corporation that refusesto allow inspection; therefore, any claim under that statute would be against the corporation, not againsthis sisters. As O'Malley acknowledges elsewhere in his brief, the corporation is not a party to this litigation.Finally, even if O'Malley had shown a violation of §§ 180.1602-1604, he does not point to anything in thesettlement agreement establishing that compliance with these statutes was a prerequisite to transferringownership of the corporation.8Undue influence is a legal theory that is typically used as a basis for objecting to a will, and has no apparentrelevance here. See Kehrbert v. Pribnow, 46 Wis. 2d 205, 208-09, 174 N.W.2d 256 (1970) (discussingthe elements of undue influence, which are susceptibility, opportunity, disposition, and the achievement ofa coveted result).Economic duress can be a defense to the enforcement of a contract, but a party alleging economic duressmust prove that the party was the victim of a wrongful or unlawful act; the act or threat deprived the partyof the party's unfettered will; and as a result, the party was compelled to make a disproportionate exchangeof values or give something up for nothing. Wurtz v. Fleischman, 97 Wis. 2d 100, 109, 293 N.W.2d 155(1980). O'Malley has not shown that any of these elements were satisfied here.9See Green v. Hahn, 2004 WI App 214, ¶21, 277 Wis. 2d 473, 689 N.W.2d 657 (“Except in rare circumstancesthat are not present here, we will not address an issue that an appellant raises for the first time on appeal,because doing so undermines judicial economy and creates an incentive for parties to build in error in orderto have an adverse outcome in the trial court overturned on appeal.”).10In his appellate briefing, O'Malley makes a more general argument about “post-signing misconduct” which,he asserts, could prevent the settlement agreement from being enforced. However, as legal authority for thisproposition, he includes a citation to a purported Wisconsin Court of Appeals case that does not exist. Thisis consistent with other false case citations that are scattered throughout his briefs, which we disregard.11Conversely, O'Malley argues that if the attorney did not represent the corporation during the settlementnegotiations, that could create a different problem, in that the corporation would be bound to an agreement
Ann K. Cady, Beth L. Corning, and Caron G. Roesler,..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.12it entered without its own counsel. O'Malley does not cite any legal authority to support his assertion thatthis creates a problem, and we see no problem under these facts. As noted, all of the shareholders of thecorporation were parties to the settlement agreement, and O'Malley fails to explain why the shareholderscould not collectively reach an agreement to which the corporation would also be bound.12The record reflects that O'Malley filed three motions, the first two on December 16, 2024, and the third onthe morning of January 7, 2025. The December 2024 motions asked the circuit court to allow him to proceedpro se, to consider his pro se brief, and to seal certain documents that he had filed, and the court did that.O'Malley’s January 2025 motion asked the court to “delay any subsequent hearings ... for 60 days followingreceipt of still missing corporate records to allow [O'Malley] time to secure replacement counsel and to reviewcorporate records,” and the court gave its reasons for denying that motion during the hearing that took placethat same day.O'Malley’s appellate briefing makes references to “motions to compel” that O'Malley says he filed during thecircuit court proceedings, but there is nothing in the record that supports O'Malley’s assertion that he filed amotion to compel. O'Malley may be referring to the pro se motions he filed in December 2024 and in January2025 that we addressed in the preceding paragraph; if so, none of these documents contained any motionto compel. Likewise, although O'Malley asserts that his January 2025 motion “condition[ed] withdrawal” ofhis third set of attorneys on his sisters’ “production of missing corporate records and time for review,” themotion did no such thing.13To the extent that O'Malley makes any additional arguments in his appellate briefs that we have not explicitlyaddressed here, we reject those arguments as undeveloped, unsupported, or unpersuasive. Pettit, 171 Wis.2d 627, 646-47.End of Document© 2026 Thomson Reuters. No claim to original U.S. Government Works.
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