COURT OF APPEALS
DECISION
DATED AND FILED
February 2, 2010
David
R. Schanker
Clerk of Court of Appeals
|
|
NOTICE
|
|
|
This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official
Reports.
A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See Wis. Stat. § 808.10 and Rule 809.62.
|
|
Appeal No.
|
|
|
STATE OF WISCONSIN
|
IN COURT OF
APPEALS
|
|
DISTRICT III
|
|
|
|
|
Keith T. Henricksen,
Plaintiff-Appellant,
v.
Douglas A. Henricksen, Rita A. Henricksen and
Phyllis Henricksen,
Defendants-Respondents.
|
|
|
|
|
|
|
|
APPEAL
from a judgment of the circuit court for St. Croix County: scott
r. needham, Judge. Affirmed.
Before Hoover,
P.J., Peterson and Brunner, JJ.
¶1 PER CURIAM. Keith
Henricksen appeals a summary judgment granted in favor of Phyllis, Douglas and
Rita Henricksen (collectively, Phyllis).
Keith argues the circuit court erred by concluding that the proceeds
from the sale of Phyllis’s homestead were governed by Minnesota’s homestead exemption, Minn. Stat.
§ 510.07 (2002). We reject Keith’s
arguments and affirm the judgment.
Background
¶2 The circuit court found the following facts. Keith is the owner of a judgment against
Phyllis, arising from a lawsuit involving a family-owned business. The judgment—in the amount of $110,382.46
plus continuing costs and interest—was originally issued in Minnesota in 1994,
and docketed in St. Croix County in
August 2007. In June 2006, Phyllis moved
from her home in Duluth, Minnesota, to live with her son, Douglas, and
his wife, Rita, in New Richmond, Wisconsin.
A month later, Phyllis sold her Minnesota
homestead, the net proceeds of which were $158,706.07.
¶3 In order to facilitate the sale and convey clear title to the
property, Phyllis and Keith agreed that $35,000 of the sale proceeds would be
applied toward the judgment. The
parties’ verbal agreement was confirmed in an e-mail that was printed and
signed by both parties. The agreement
provided, in relevant part:
The parties agree that all sale proceeds received by my
client net of the $35,000 payment to your client, the existing mortgage balance
and other closing costs and expenses shall be deemed proceeds arising from the
sale of my client’s homestead which are exempt for the period of one year after
sale pursuant to Minn. Stat. § 510.07.
¶4 From the balance of the proceeds, Phyllis gifted $100,000 to Douglas, and he applied a majority of the gift to a
mortgage on property owned by him and his wife.
The remainder of the proceeds was transferred without explanation during
the one-year exemption period. Keith filed
the underlying suit, alleging that the gift to Douglas
was a fraudulent transfer intended to render Phyllis insolvent with no assets
to satisfy Keith’s judgment.
¶5 Based on the parties’ written agreement, the circuit court
concluded that the sale of Phyllis’s homestead was governed by Minnesota’s homestead
exemption, which provides, in relevant part:
“The owner may sell and convey the homestead without subjecting it, or
the proceeds of such sale for the period of one year after sale, to any
judgment or debt from which it was exempt in the owner’s hands.” Minn. Stat.
§ 510.07. In contrast, under
the relevant Wisconsin statute, the homestead
exemption “shall extend to the proceeds derived from the sale to an amount not
exceeding $40,000, while held, with the intention to procure another homestead
with the proceeds, for 2 years.” Wis. Stat. § 815.20(1).
¶6 Therefore, unlike Wisconsin,
Minnesota’s
homestead exemption law does not place restrictions on the use of homestead
proceeds or otherwise require a debtor to reinvest proceeds in another
homestead. Further, under Minnesota law, a
creditor may not contest a debtor’s disposition of exempt homestead proceeds, even
if there was fraudulent intent by the debtor.
See O’Brien v. Johnson, 148
N.W.2d 357, 360 (Minn.
1967). Having concluded Minnesota law applied, the court entered judgment in
Phyllis’s favor on grounds that her gift to Douglas
could not constitute fraud as a matter of law.
This appeal follows.
Discussion
¶7 This court reviews summary judgment decisions independently,
applying the same standards as the circuit court. Smith v. Dodgeville Mut. Ins. Co.,
212 Wis. 2d
226, 232, 568 N.W.2d 31 (Ct. App. 1997).
Summary judgment is granted when there are no genuine issues of material
fact and the moving party is entitled to judgment as a matter of law. Green Spring Farms v. Kersten,
136 Wis. 2d
304, 315, 401 N.W.2d 816 (1987).
¶8 Keith argues the court erred by concluding the parties had
contracted for application of Minnesota’s
homestead exemption to the subject sale proceeds. The construction of a written contract presents
a question of law that this court reviews independently. Rosplock v. Rosplock, 217 Wis. 2d 22, 30, 577
N.W.2d 32 (Ct. App. 1998). Whether a
contract is ambiguous is also a question of law that we decide independently of
the trial court. Id.
A contract is ambiguous if it is reasonably susceptible to more than one
meaning. Id.
When a contract is plain and unambiguous, a court will construe it as it
stands without looking to extrinsic evidence to determine the intent of the
parties. Id. at 31. Courts may not rewrite a clear and
unambiguous contract, or use the mechanism of construction to review an
unambiguous contract to relieve a party from any disadvantageous terms to which
the party has agreed. Id.
¶9 Further, parties are generally free to contract for choice of
law, although not “at the expense of important public policies of a state whose
law would be applicable if the parties[’] choice of law provision were
disregarded.” Bush v. National Sch. Studios,
Inc., 139 Wis.
2d 635, 642, 407 N.W.2d 883 (1987). Among
the laws “likely to embody an important state public policy” are those that
“are designed to protect a weaker party against the unfair exercise of superior
bargaining power by another party.” Id. at 643.
¶10 Here, Keith contends the agreement’s language did not evince
the parties’ intent to have Minnesota
law govern disposition of the proceeds no matter where Phyllis resided. Rather, he argues that absent specific
language regarding the scope of their choice of law, “[t]he agreement merely
provides a description of the proceeds as they existed at the time the
agreement was prepared, not an agreement that Minnesota’s exemption statute
would govern all creditor actions.” We
are not persuaded.
¶11 Under the agreement’s clear language, proceeds arising from the
sale of Phyllis’s home were exempt for one year under Minn. Stat. § 510.07. If the parties had intended there to be some
limitation on the application of Minnesota’s
homestead exemption to these proceeds, the contract would have contained
language providing such limitation.
Contrary to Keith’s claim, the absence of limiting language does not
render the parties’ agreement non-binding or otherwise ambiguous.
¶12 We further conclude that the parties’ contractual election of
Minnesota’s homestead exemption was not done at the expense of an important
state public policy, such as the consumer protection act, or other law “designed
to protect a weaker party against the unfair exercise of superior bargaining
power by another party.” See id.
Here, both parties were represented by counsel and agreed that Minnesota’s homestead
exemption law would apply to the sale proceeds.
Because proceeds from the sale of Phyllis’s homestead were governed by Minn. Stat.
§ 510.07, the court properly concluded that the gift to Douglas
could not constitute fraud as a matter of law.
By the Court.—Judgment affirmed.
This
opinion will not be published. See Wis.
Stat. Rule 809.23(1)(b)5.