                                                                          2019 WI 61

                  SUPREME COURT                OF    WISCONSIN
CASE NO.:               2016AP2334
COMPLETE TITLE:         Leicht Transfer & Storage Company,
                                   Plaintiff-Appellant-Petitioner,
                             v.
                        Pallet Central Enterprises, Inc.,
                                   Defendant,
                        Travelers Property Casualty Company, Acuity, A
                        Mutual Insurance Company and Hiscox Insurance
                        Company Inc.,
                                   Defendants-Respondents.

                              REVIEW OF DECISION OF THE COURT OF APPEALS
                              Reported at 382 Wis. 2d 270,915 N.W.2d 729
                                         (2018 – unpublished)

OPINION FILED:          May 31, 2019
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:          February 1, 2019

SOURCE OF APPEAL:
   COURT:               Circuit
   COUNTY:              Brown
   JUDGE:               Marc A. Hammer

JUSTICES:
   CONCURRED:
   DISSENTED:           A.W. WALSH, J. dissents (opinion filed).
   NOT PARTICIPATING:

ATTORNEYS:


       For the plaintiff-appellant-petitioner, there were briefs
filed by George Burnett and Conway, Olejniczak & Jerry, S.C.,
Green Bay. There was an oral argument by George Burnett.


        For       the   defendant-respondent        Hiscox    Insurance      Company,
Inc.,    there      was   a    brief   filed   by   Kris     Bartos,   and    Jeffrey
Leavell, S.C., Racine. There was an oral argument by Jeffrey
Leavell.
                                                                        2019 WI 61
                                                                NOTICE
                                                  This opinion is subject to further
                                                  editing and modification.   The final
                                                  version will appear in the bound
                                                  volume of the official reports.
No.    2016AP2334

(L.C. No.   2015CV878)

STATE OF WISCONSIN                            :            IN SUPREME COURT

Leicht Transfer & Storage Company,

            Plaintiff-Appellant-Petitioner,

      v.

Pallet Central Enterprises, Inc.,                                    FILED
            Defendant,                                          May 31, 2019
Travelers Property Casualty Company, Acuity, A                     Sheila T. Reiff
Mutual Insurance Company and Hiscox Insurance                   Clerk of Supreme Court
Company Inc.,

            Defendants-Respondents.




      REVIEW of a decision of the Court of Appeals.                Affirmed.


      ¶1    DANIEL KELLY, J.         Pallet Central Enterprises, Inc.,
("Pallet Central") forged certain delivery tickets and used them
to bill Leicht Transfer & Storage Company ("Leicht") for the
sale and delivery of pallets that Pallet Central never sold or
delivered.      This     case   followed,   and   in    the    piece     of   it    we
address today, Leicht sought coverage for its losses under the
                                                                    No.     2016AP2334



Commercial    Crime     Insurance     Policy        issued    to   it     by    Hiscox
Insurance    Company,     Inc.      ("Hiscox").            Specifically,        Leicht
asserts that the forged delivery tickets comprise "directions to
pay" within the meaning of the "Forgery or Alteration" insuring
agreement of the Hiscox policy.               We disagree, and so we affirm
the court of appeals.1
                               I.    BACKGROUND
     ¶2     Leicht provides warehousing services in the Green Bay
area.     It uses pallets to assist in the storage and shipment of
warehoused    items.      Between     January       2013     and   February      2015,
Leicht purchased pallets from Pallet Central.                       The companies
followed a standard practice for documenting these transactions
for the purpose of inventory control and billing.                      Part of that
standard    practice    involved     Pallet     Central's      preparation         of   a
delivery ticket describing the shipment, including the type of
pallets, the number to be delivered, the delivery date, and the
identification       number   of    the   trailer      conveying        them.       The
delivery    ticket    would   accompany       the    truck    driver      making    the
shipment.     Upon delivery, a Leicht employee would verify the
shipment and sign the delivery ticket.                 The truck driver would
then return a copy of the delivery ticket to Pallet Central,
after which Pallet Central would prepare an invoice package.


     1 This is a review of an unpublished per curiam opinion of
the court of appeals, Leicht Transfer & Storage Co. v. Pallet
Cent. Enter., No. 2016AP2334, unpublished slip op. (Wis. Ct.
App. Apr. 25, 2018) (per curiam), which affirmed the Brown
County Circuit Court, the Honorable Marc A. Hammer, presiding.



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The package comprised an invoice, a copy of the signed delivery
ticket, and a voucher.2            Pallet Central would then submit the
invoice package to Leicht for payment.                   Leicht would pay the
invoice    only    if   the   package    contained   a    copy   of     the   signed
delivery   ticket.        Leicht   would then bill         its   customers for,
inter alia, the pallets it used in storing and shipping their
goods.
     ¶3     Eventually,       Leicht    became   aware    that   the    number    of
invoice packages Pallet Central was submitting had dramatically
increased.        Leicht's internal investigation revealed that many
of the delivery tickets bore the apparent signatures of Leicht
employees who could not possibly have executed the documents.
Ultimately, Leicht concluded that the signatures were forged,
and that it had consequently paid Pallet Central for pallets it
never received.3        Leicht says Pallet Central submitted fraudulent
invoice packages worth approximately $751,000.00, of which it
paid approximately $505,000.00.


     2 Leicht did not describe the voucher, and the sole invoice
package in the Record contains only an invoice and delivery
ticket. Therefore, our analysis does not rely on the nature or
content of the voucher. We have included the invoice package as
an appendix to our opinion.   We assume this invoice package is
representative of all invoice packages submitted by Pallet
Central to Leicht (aside from the question of forgery and the
absence of the voucher).
     3 Leicht reported its findings to the DePere Police
Department. The investigating officer concluded that Leicht had
been the victim of theft by use of fraudulent invoices. Whether
the delivery tickets at issue actually were forged is not before
us, and we express no opinion on that question.



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      ¶4    Leicht submitted its loss to Hiscox pursuant to the
terms of its Commercial Crime Insurance Policy (the "Policy").
The   relevant    language,     found     in    the    "Forgery       or    Alteration"
insuring agreement, states the following:

      (1) Checks

      We will pay for loss resulting directly from Forgery
      or alteration of checks, drafts, promissory notes,
      convenience checks, HELOC checks, or similar written
      promises, orders or directions to pay a sum certain in
      Money that are:

            (i)     Made or drawn by or drawn upon You; or

            (ii) Made or drawn by one acting as Your
            agent; or that are purported to have been so
            made or drawn.[4]
(Emphasis added).       Hiscox denied coverage, and Leicht sued.                         It
alleged    Hiscox    breached   its     contract,       and    asked       the    circuit
court to declare that the Policy covers its losses from the

forged delivery tickets.5
      ¶5    Hiscox moved for summary judgment, arguing that the
Policy's    "Forgery    or    Alteration"       insuring       agreement         did    not
provide    coverage     because     the       forged    delivery       tickets         were
neither    "checks"     nor   any   of    the     other       types    of    documents


      4The Policy emphasizes certain words to indicate they are
defined terms.     We have omitted the emphasis to avoid a
suggestion we are assigning particular importance to those
words.
      5Leicht also named two of its other insurers, as well as
Pallet Central, as defendants.     However, Hiscox is the only
defendant currently before the court, and so we do not address
claims made against any other party.



                                          4
                                                                    No.   2016AP2334



identified by the Policy.            Hiscox also argued that the forged
delivery tickets were not "drawn upon" Leicht, which it said is
a prerequisite to coverage.                Leicht disagreed.         It said the
Policy covers the delivery tickets because Pallet Central used
them as a means of directing payment.                Therefore, it concluded,
the Policy covers the delivery tickets as "directions to pay a
sum certain in Money."6
       ¶6        The circuit court granted Hiscox's motion, concluding
that the Policy's "Forgery or Alteration" insuring agreement did
not provide coverage.          The court of appeals affirmed, explaining
that       the   Policy    "enumerate[s]       specific   covered    instruments,
including        checks,   drafts   and    promissory     notes,    and   'similar
written promises, orders or directions to pay a sum certain' in
money" and that "[t]he delivery tickets Leicht relies upon were
not written promises, orders or directions to pay 'similar' to
the enumerated documents covered under the polic[y]."                       Leicht

Transfer & Storage Co. v. Pallet Cent. Enter., No. 2016AP2334,
unpublished slip op., ¶11 (Wis. Ct. App. Apr. 25, 2018) (per

curiam).         The court of appeals said the forged delivery tickets
"were merely evidence of a claim that pallets were delivered by
Pallet Central to Leicht."          Id., ¶¶12-13.

       6
       To the extent Leicht previously argued that coverage
exists under other portions of the Hiscox policy, those
arguments are not before this court and we therefore consider
only the coverage question presented.     See, e.g., A.O. Smith
Corp. v. Allstate Ins. Cos., 222 Wis. 2d 475, 491, 588
N.W.2d 285 (Ct. App. 1998) ("[A]n issue raised in the trial
court, but not raised on appeal, is deemed abandoned.").



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      ¶7      Leicht's   petition      for      review    asserted     that     the
Policy's      coverage   of      "similar    written     promises,     orders    or
directions to pay a sum certain" is a "recipe for ambiguity"
because "[n]othing in the policy alerts the policyholder how or
why   other    forged    documents     might    be   similar."       We    granted
Leicht's petition and now hold that the Policy does not afford
the   coverage    Leicht      seeks   because    Pallet    Central's      delivery
tickets are not "written . . . directions to pay a sum certain
in Money."
                           II.    STANDARD OF REVIEW




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      ¶8     We    review    the    disposition        of    a     motion    for    summary
judgment     de    novo,    applying      the   same       methodology       the    circuit
courts apply.        Green Spring Farms v. Kersten, 136 Wis. 2d 304,

315, 401 N.W.2d 816 (1987).                While our review is independent
from the circuit court and court of appeals, we benefit from
their   analyses.          See    Preisler      v.    Gen.    Cas.    Ins.        Co.,   2014
WI 135, ¶16, 360 Wis. 2d 129, 857 N.W.2d 136.                         Summary judgment
is appropriate only "if the pleadings, depositions, answers to
interrogatories,       and       admissions      on    file,       together       with    the
affidavits, if any, show that there is no genuine issue as to
any   material     fact     and    that   the    moving      party     is    entitled      to
judgment as a matter of law."              Wis. Stat. § 802.08(2) (2017-18);
see also Columbia Propane, L.P. v. Wis. Gas Co., 2003 WI 38,
¶11, 261 Wis. 2d 70, 661 N.W.2d 776 (quoting and applying Wis.
Stat. § 802.08(2) (2001-02)).
      ¶9     The interpretation of an insurance policy presents a
question of law.           Water Well Sols. Serv. Grp. Inc. v. Consol.
Ins. Co., 2016 WI 54, ¶12, 369 Wis. 2d 607, 881 N.W.2d 285.                               We

review such questions de novo.             Id.
                                   III.    ANALYSIS
      ¶10    The Policy contains three relevant requirements that
Leicht must satisfy before it is entitled to coverage for its
losses.      First, it must demonstrate that a "delivery ticket" is
the   type    of    document       encompassed        by     the    Policy's       insuring
agreement.        Second, it must show that the delivery tickets were
"[m]ade or drawn by or drawn upon [Leicht]; or [m]ade or drawn


                                            7
                                                                          No.     2016AP2334



by one acting as [Leicht's] agent; or that are purported to have
been so made or drawn."               And third, it must establish that the
payments it made to Pallet Central constitute a "loss resulting
directly" from the forgery.                 To evaluate these requirements, we
must discern the meaning of the Policy's insuring agreement, and
how its terms apply to the facts of this case.
       ¶11   Our    goal      in    interpreting      and     applying     an    insurance
policy's terms is the same as it is in addressing any other
contract:          To       "effectuate      the     intent     of   the     contracting
parties."     Estate of Sustache v. Am. Family Mut. Ins. Co., 2008

WI 87, ¶19, 311 Wis. 2d 548, 751 N.W.2d 845 (citations omitted).
In doing so, we construe insurance contracts "as they would be
understood     by       a    reasonable      person    in     the    position      of    the
insured[,]" yet we will "not interpret insurance policies to
provide coverage for risks that the insurer did not contemplate
or underwrite and for which it has not received a premium."                              Am.
Family Mut. Ins. Co. v. Am. Girl, Inc., 2004 WI 2, ¶23, 268
Wis. 2d 16,        673       N.W.2d 65      (citations        omitted).          We      will

interpret     undefined            words    and    phrases      as    they       would    be
understood by a reasonable insured, Bethke v. Auto-Owners Ins.
Co., 2013 WI 16, ¶22, 345 Wis. 2d 533, 825 N.W.2d 482, and "[w]e
give   undefined         words     and     phrases    their    common      and    ordinary
meaning."      Day v. Allstate Indem. Co., 2011 WI 24, ¶28, 332
Wis. 2d 571,       798      N.W.2d 199.        "If    the     undefined     language      is
ambiguous, we will construe it in favor of the insured to afford
coverage."     Bethke, 345 Wis. 2d 533, ¶22.                    A term or phrase is


                                              8
                                                                    No.    2016AP2334



ambiguous only if it is "'fairly susceptible to more than one
reasonable interpretation.'"             Wilson Mut. Ins. Co. v. Falk, 2014

WI 136, ¶24, 360 Wis. 2d 67, 857 N.W.2d 156 (citation omitted).
     ¶12    We    begin     our   analysis      with   Leicht's     position    that
"delivery tickets," when combined with corresponding invoices,
are included in the type of documents the Policy covers.                            The
insuring    agreement        describes      covered     documents     as    "checks,
drafts, promissory notes, convenience checks, HELOC checks, or
similar    written promises,        orders or         directions    to    pay a sum
certain in Money."          Because Leicht says the delivery tickets are
covered as "directions to pay a sum certain in Money," this part
of the inquiry actually involves two steps.                        First, we must
determine whether a delivery ticket is, in fact, a direction to
pay a sum certain in money (alone or in conjunction with an
invoice).        If    it   is,   then    we   must    consider    whether     it   is
"similar"    to       "checks,    drafts,      promissory    notes,      convenience
checks, [or] HELOC checks."              It is a covered document only if it
meets both criteria.
     ¶13    Neither party has suggested the phrase "directions to
pay a sum certain in Money" is ambiguous.                   And as the following
analysis will demonstrate, we espy no ambiguity in it either.
Therefore, we "interpret the policy according to its plain and
ordinary meaning to avoid imposing contract obligations that the
parties did not undertake."              Frost ex rel. Anderson v. Whitbeck,
2002 WI 129, ¶17, 257 Wis. 2d 80, 654 N.W.2d 225.                   The plain and
ordinary meaning of the phrase unmistakably indicates that, by


                                           9
                                                                  No.    2016AP2334



themselves, the delivery tickets are not "directions to pay a
sum certain in Money."              The documents' most obvious defect in
this regard is that they contain no directions to pay.                         They
are, instead, simple statements that Pallet Central delivered a
certain type and number of pallets on a particular day.                    To the
extent the delivery tickets contain any directions at all, they
are as follows:

     [Leicht] [m]ust notify us of any quantity disputes
     and/or quality matters within 72 hours of delivery or
     credit will not be issued.

     Please use our tickets for DELIVERIES and PLEASE make
     three (3) copies, one for you, one for the customer
     and one for the driver. Have the driver fill out the
     ticket (truck #, trailer # and driver signature).
     Then PLEASE fax the filled out ticket back to me at
     [###-###-####].
With respect to payment, they are entirely inert, and contain no
motive     force   whatsoever       by   which   to    direct   anyone    to   pay
anything.

     ¶14    The     delivery    tickets       also    conspicuously     lack   any
reference to a "sum certain."            In fact, they do not reference an

amount due, or even a calculation by which one may arrive at an
amount due.        Indeed, they say nothing about currency, payment,

or anything else one might associate with money, much less a
"sum certain."       Leicht conceded this point at oral argument, and
further admitted it would not have paid Pallet Central if it had
presented    nothing    but     a    delivery    ticket.        The   unavoidable
conclusion, therefore, is that a delivery ticket——by itself——is
not a direction to pay a sum certain in money.


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       ¶15    Nor does a delivery ticket become a direction to pay
when bundled with a corresponding invoice.                           Leicht acknowledged
that an invoice is a request for payment, not a direction to
pay.     So if the delivery ticket becomes a direction to pay when
attached      to    an    invoice,     the     combination          must    be     capable     of
making the invoice package greater than the sum of its parts.
But Leicht did not explain how combining the two would turn one
of them (or both) into a direction to pay a sum certain in
money.       The best it could offer was this:                      "Without the signed
ticket Pallet Central could not be paid.                            Indeed, that is why
Pallet Central forged those tickets in the first place."                                     That
is likely so, and we accept Leicht's reasoning for the purpose
of   this     analysis.          But   it      cannot       carry   the     weight      of    its
argument.       Leicht's explanation describes a document evidencing
Pallet       Central's     satisfaction          of     a     condition      precedent         to
payment.           Just    because       the     signed       delivery       ticket      is     a
prerequisite to payment, however, does not transform it (or the
combined documents) into a direction to pay a sum certain in
money.       The delivery ticket does not affect the invoice's nature
(it is still a request), and the invoice does not create terms
in the delivery ticket that were not there before (it still
directs no payment, much less a sum certain).                                Combined, the
documents      retain      the    same       characteristics         that    defined         them
separately:          A    request      for     payment,      and    proof    of       delivery.
Consequently,        the    delivery         ticket——whether         taken       on    its    own




                                               11
                                                                  No.      2016AP2334



terms or in conjunction with an invoice——is not a direction to
pay a sum certain in money.
       ¶16     That, however, does not address Leicht's position in
full.     A close examination of its arguments reveals that Leicht
did not explicitly claim that a delivery ticket is a direction

to pay.       Instead, it said "the delivery ticket[s] represented a
direction to pay," and that "the parties used these delivery
tickets to direct payment from Leicht's finance department," and
that    the "tickets served        as a written        direction to        Leicht's
bursar    to    pay   Pallet    Central's     invoices."     That     is      to   say,
Leicht asserts that delivery tickets function as a direction to
pay.
       ¶17     The distinction is subtle, but no less real for that.
And    that    distinction      helps   illustrate     why   there      can    be     no
coverage for the forged delivery tickets.                  It is a commonplace
that what something "is" can differ from the function to which
it is put.       An object might be a chair, and at times function as
a very short ladder.            But that does not mean the chair is a

ladder.        And if an insurance policy insures only against the
loss of ladders, the chair owner will be disappointed.                             Here,
the    Policy    applies   to    forgery      of   "directions   to     pay    a     sum
certain in Money."         As discussed above, the delivery tickets are
unquestionably not that.            Therefore, there can be no coverage
unless the Policy applies to writings that are not "directions
to pay," but which are nonetheless used for that purpose.                             We
see    nothing in the Policy,           however,     that grants coverage             to


                                         12
                                                                      No.   2016AP2334



documents    not   covered   by     its       terms,    but   which   are   used     as
functional proxies for documents that are covered by its terms.
So   when   Leicht   says    "the    delivery          tickets   functioned     as    a
direction to make payment, just as the policies required," it is
mistaken.    The Policy required a direction to pay, not a stand-
in for a direction to pay.7
                                          *



      7For a similar reason, the dissent's analysis cannot reach
Leicht's preferred end. The author says: "Examining the policy
language in light of the parties' habitual practice, and
consistent with this court's precedent, I arrive at the opposite
conclusion."   Dissent, ¶22.   The insurance policy, of course,
does not insure against loss caused by "Forgery or alteration"
of Leicht and Pallet Central's "habitual practice." It insures
against loss from "Forgery or alteration" of specifically
described documents, of which a delivery ticket is not one.

     The key explanation the dissent offers for its contrary
conclusion is this:

      "[I]f it looks like a duck, swims like a duck, and quacks
      like a duck, then it probably is a duck." This test
      suggests that something can be identified by its habitual
      characteristics, i.e. how it routinely functions.

Id., ¶34.

     The point of the "duck" exercise is not to equate two
things that are not the same. It is to identify what something
really is. That is, one does not build an animatronic duck, set
it afloat in a puddle with a quack soundtrack, and conclude it
is an actual member of the Anatidae family.   But that is what
the dissent proposes here. Leicht and Pallet Central may have a
private understanding that they will act as though the delivery
ticket is a direction to pay a sum certain. But that does not
mean we (and Hiscox) must conclude it is such a document any
more   than  an   ornithologist  must  conclude   the  floating
fabrication actually is a duck.



                                          13
                                                                                     No.       2016AP2334



       ¶18     If we had concluded that the delivery tickets, alone
or    in     conjunction           with     corresponding           invoices,            constituted
"directions        to    pay,"       we    then    would         have    needed          to    consider
whether      the     Policy's        insuring          agreement         covered         only      those
"directions        to      pay"      that    are       similar          to    the     specifically
identified documents (i.e.,                   checks,         drafts, promissory                 notes,
convenience checks, or HELOC checks).                            We also would have needed
to determine whether they had been "[m]ade or drawn by or drawn
upon"      Leicht,      or     were       "[m]ade       or       drawn       by    one     acting     as
[Leicht's] agent; or that [were] purported to have been so made
or    drawn."        And      finally,      we    would          have    needed       to      determine
whether      the   payments          induced      by       the    forged          delivery      tickets
comprised losses "resulting directly from" the forgery.                                         But all
of these issues are contingent on having discerned a "direction
to pay" in the forged delivery tickets.                             Because we did not, we
have no need to examine these additional issues.                                              Am. Girl,

Inc., 268 Wis. 2d 16, ¶24 ("If it is clear that the policy was
not   intended to cover               the claim asserted,                    the     analysis       ends

there."). The Policy's insuring agreement does not encompass the
forged delivery tickets, and we may not add coverage for which
the    parties     did       not    bargain.           Id.,       ¶23    (citations            omitted)
("[W]e do not interpret insurance policies to provide coverage
for risks that the insurer did not contemplate or underwrite and
for    which    it      has    not    received         a     premium.").             Consequently,
Leicht's quest for coverage must end.
                                      IV.     CONCLUSION


                                                  14
                                                                  No.      2016AP2334



      ¶19    We conclude that the Policy unambiguously demonstrates
that the delivery tickets at issue in this case, either alone or
in combination with corresponding invoices, do not qualify as
"written . . . directions        to    pay    a    sum    certain     in    Money."
Further, we conclude that the Policy does not provide coverage
for   forged      documents   that   are    not   themselves     "directions      to
pay," but which are used as proxies for such documents.                     Summary
judgment for Hiscox was, therefore, appropriate.                  We affirm the
court of appeals.
      By    the    Court.—The   decision     of   the    court   of     appeals   is
affirmed.




                                       15
    No.   2016AP2334




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    No.   2016AP2334




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                                                                   No.   2016AP2334.awb


     ¶20    ANN WALSH BRADLEY, J.               (dissenting).      This case arose
after    Pallet    Central     Enterprises,         Inc.    submitted      fraudulent
invoices to Leicht Transfer & Storage Company for nonexistent
pallets that were never delivered.                  Majority op., ¶3.            Leicht
purchased a crime insurance policy to protect itself against
precisely this type of fraudulent activity.                     Nevertheless, the
majority denies coverage, sticking Leicht with a half million
dollar     bill   for    losses      that       resulted    from   Pallet       Central
Enterprises, Inc.'s fraudulent scheme.

     ¶21    The     majority        can   reach      its    conclusion         only   by
disregarding        long-held        principles        of     insurance          policy
interpretation——which          we     call       precedent.        It     is     firmly
established       that   an    insurance         policy's     terms      are     to   be
interpreted as they would be understood from the perspective of
a reasonable person in the position of the insured.                       Shugarts v.

Mohr, 2018 WI 27, ¶20, 380 Wis. 2d 512, 909 N.W.2d 402 (citation
omitted).      Likewise, it is well-settled that ambiguity in an

insurance policy is construed in favor of an insured seeking
coverage.     Olson v. Farrar, 2012 WI 3, ¶42, 338 Wis. 2d 215, 809
N.W.2d 1 (citation omitted).
     ¶22    Casting      these        principles       aside,       the        majority
determines that Leicht is not entitled to insurance coverage for
losses incurred due to the fraudulent actions of Pallet Central.
Examining the policy language in light of the parties' habitual
practice, and consistent with this court's precedent, I arrive
at the opposite conclusion.
     ¶23    Accordingly, I respectfully dissent.

                                            1
                                                                               No.    2016AP2334.awb


                                                     I
      ¶24      For    a     period        of    over       two    years,     Leicht      purchased
pallets for its warehouse from Pallet Central.                                     Majority op.,
¶2.      As    the     majority           accurately        details,        Leicht     and    Pallet
Central       "followed         a   standard          practice      for     documenting         these
transactions for the purpose of inventory control and billing."
Id.

      ¶25      Pursuant to this practice, each time Pallet Central
made a delivery of pallets, it would give to Leicht a delivery

ticket.        Id.        The delivery ticket described the shipment of

pallets, identified the number of pallets delivered, specified
the delivery date, and provided the identification number of the
trailer on which the pallets arrived.                              Id.       A Leicht employee
would then sign the delivery ticket, indicating the pallets had
been received.            Id.
      ¶26      After      the       delivery         ticket      had    been      signed,     Pallet
Central       would    prepare            an   invoice       package        that     included    the

signed    delivery         ticket.             Id.       Leicht    would       then    pay    Pallet
Central       for     the       delivery,            but    only       if    the      invoice     was
accompanied by a signed delivery ticket.                           Id.
      ¶27      When it came to light that Pallet Central submitted
invoices       to    Leicht         for    nonexistent           pallets     that      were     never
delivered, an investigation ensued.                              It revealed that Leicht
employees' signatures on the delivery tickets had been forged.
Id., ¶3.       This caused Leicht to suffer a loss of approximately
$505,000 from paying the fraudulent invoices.                               Id.



                                                     2
                                                                         No.    2016AP2334.awb


       ¶28   Leicht carried a crime insurance policy.                           As relevant
here, the policy provides:

       (1) Checks

       We will pay for loss resulting directly from Forgery
       or alteration of checks, drafts, promissory notes,
       convenience checks, HELOC checks, or similar written
       promises, orders or directions to pay a sum certain in
       Money that are:

              (i)         Made or drawn by or drawn upon You; or

              (ii)        Made or drawn by one acting as Your agent;

              or that are purported to have been so made or
              drawn.
       ¶29   The majority determines that Leicht is not entitled to
coverage under this provision of the policy.                         It concludes that
a     "delivery     ticket——whether           taken     on   its    own        terms    or     in
conjunction with an invoice——is not a direction to pay a sum
certain in money."             Majority op., ¶15.            In the majority's view,
the     delivery        ticket    contains         no   direction        to    pay     and     no
reference to a sum certain.                  Id., ¶14.       Further, it opines that

coverage     does       not    attach    to    a    signed    delivery          ticket       that
functions as a direction to pay, but is not itself a direction
to pay.      Id., ¶¶16-17.
                                              II
       ¶30   As     I    see     it,   the    language       of    the    policy       creates

several conditions that the signed delivery ticket at issue in
this case must fulfill in order for coverage to attach.                                 First,
the signed delivery ticket must be a written promise, order or
direction to pay a sum certain in money.                           Second, it must be
similar to a check, draft, promissory note, convenience check,

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or HELOC checks.             Finally, as provided in the crime insurance
policy, the signed delivery ticket must be "[m]ade or drawn by
or   drawn    upon     [Leicht],       [m]ade      or    drawn    by    one     acting       as
[Leicht's] agent; or [was] purported to have been so made or
drawn."1
                                             A
      ¶31    I address first whether a signed delivery ticket is,
as   interpreted       by    reasonable      person      in   the      position    of    the
insured, a "direction to pay" a sum certain in money.

      ¶32    It is imperative that our review of the language of an
insurance policy be through the lens of a reasonable insured.
Shugarts,     380      Wis. 2d 512,        ¶20.         The   insured,       Leicht,     was

engaged in a repeated and specific process by which payment was
directed by the submission of certain documents, namely a signed
delivery ticket and invoice.
      ¶33    Given the habitual practice the parties followed in
their transactions, a reasonable insured in Leicht's position

would     understand        that   a   signed     delivery       ticket      serves     as    a
"direction        to   pay."       Indeed,        the    record     reflects      that       an
unsigned delivery ticket               would not be paid,              unlike a signed
ticket     that    would     be    paid.     Accompanying         a    signed     delivery
ticket is an invoice containing a sum certain for payment.                               The
parties' habitual routine was that this package of documents
would direct that payment be made.


      1Because it determines that a signed delivery ticket is not
a direction to pay a sum certain in money, the majority does not
address the second and third issues I raise.


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      ¶34    The majority departs from the language as viewed by a
reasonable insured engaging in the habitual practice of these
parties.        Simply put, its technical and theoretical distinction
between what a signed delivery ticket "is" and its "function"
not      only     discards           our        precedent         on    insurance         policy
interpretation,          but    it     also      fails    an    elementary        test.      See

majority op., ¶¶16-17.               Namely, "if it looks like a duck, swims
like a duck, and quacks like a duck, then it probably is a
duck."      This test suggests that something can be identified by

its habitual characteristics, i.e. how it routinely functions.
      ¶35    The bottom line is that the habitual practice of the
parties     established         that       a     signed      delivery       ticket    directed
payment.        It is from this perspective that we must examine the
policy's language.             Viewing the parties' habitual practice from
Leicht's     point   of        view,       I    determine      that    a    signed    delivery
ticket fulfills the policy's requirement of a "direction to pay"
a sum certain in money.

                                                  B
      ¶36    I    turn    next       to        address    whether      a    signed    delivery
ticket is "similar" to the instruments listed in the policy:
checks, drafts, promissory notes, convenience checks, or HELOC
checks.
      ¶37    In     addressing             this       question,        another       maxim    of
insurance       policy    interpretation              must   be    considered.         Namely,
ambiguous       terms must be construed in                     favor       of   coverage,    and
against the drafter.             Olson, 338 Wis. 2d 215, ¶42; see Maryland



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Arms Ltd. P'ship v. Connell, 2010 WI 64, ¶44, 326 Wis. 2d 300,

786 N.W.2d 15 (citation omitted).
     ¶38   The policy uses the term "similar."                   Inherent in the
term "similar" is a certain amount of ambiguity.                       It begs the
question, how similar is similar enough?                 The text of the policy
provides no guidance.
     ¶39   As    Leicht      aptly     argued       in     its     brief,      "[n]o
policyholder can know with certainty what documents are similar
to a check, to a draft, or to a promissory note, and conversely,

no policyholder can surmise what written 'promises, orders, or
directions   for    payment'    are    too    dissimilar      for      coverage   to
apply."
     ¶40   I agree with Leicht.            As analyzed above, a reasonable
insured would believe that a signed delivery ticket "directs
payment"   within   the    language    of     the   policy.       But    under    the
language of this policy, a policyholder is left guessing whether
such a "direction to pay" is covered if it is not explicitly

listed.    Construing the ambiguity in favor of coverage, as our
precedent requires, I determine that a signed delivery ticket
fulfills the policy's "similarity" requirement.
                                       C
     ¶41   The   next     inquiry    raised    by   the    policy      language   is
whether the signed delivery ticket is "[m]ade or drawn by or
drawn upon [Leicht], [m]ade or drawn by one acting as [Leicht's]
agent; or [was] purported to have been so made or drawn."




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       ¶42     Leicht alleges that the signatures of Leicht employees
on delivery tickets were forged.                     That is, the signatures were
"purported to have been" made by Leicht employees.
       ¶43     Further, the forged signatures were purportedly made
by Leicht employees acting as Leicht's agents.                      "Agent" is not a
defined term in the policy, meaning that we interpret it as it
would be understood by a reasonable insured.                       Acuity v. Bagadia,

2008    WI    62,     ¶13,   310   Wis. 2d 197,          750    N.W.2d 817      (citation
omitted).

       ¶44     An employee acting on behalf of an employer is the
employer's agent.            See Romero v. West Bend Mut. Ins. Co., 2016

WI     App    59,     ¶39,   371   Wis. 2d 478,          885    N.W.2d 591      (citation
omitted).           By forging signatures on delivery tickets, Pallet
Central employees purported to be acting as Leicht employees,
thereby confirming receipt of pallets that were never delivered
and directing Leicht to pay for them.
       ¶45     In     sum,   properly   examining         the    policy    as    would   a

reasonable person in the position of the insured, I conclude
that all conditions for coverage are fulfilled.                       Specifically, a
forged       signed    delivery    ticket       is   a   similar    written      promise,
order or direction to pay a sum certain that was purported to
have been made by Leicht's agent.
       ¶46     Accordingly, I respectfully dissent.




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