Wisconsin law has left the dark ages of caveat emptor or also known as “let the buyer beware” in the sale of residential property. The harshness of caveat emptor has been replaced by the Real Estate Condition Report or “RECR.” Basically, the RECR requires sellers to disclose their awareness of defects. What should be a simple concept is made complex by legalistic definitions. For instance, a “defect” is defined as a “condition that would have a significant adverse effect on the value of the property; that significantly impairs the health or safety of future occupants of the property; or that if not repaired, removed or replaced would significantly shorten or adversely affect the expected normal life of the premises.” It is not hard to imagine a silver-tongued lawyer arguing that just about anything is a defect under this definition. Consider the following quote:

“Houses are amazingly complex repositories. What I found, to my great surprise, is that whatever happens in the world – whatever is discovered or created or bitterly fought over – eventually ends up, in one way or another, in your house. Wars, famines, the Industrial Revolution, the Enlightenment – they are all there in your sofas and chests of drawers, tucked into the folds of your curtains, in the downy softness of your pillows, in the paint on your walls and the water in your pipes.” ― Bill Bryson, At Home: A Short History of Private Life

If Bill Bryson is right in saying that the history of the world is found within the four corners of a home, is it futile to expect a seller of a residential home to disclose defects? Not quite. In reality, the RECR is a straightforward document requiring a homeowner to check “yes, no, or N/A” to knowledge of defects concerning elements of the house, such as the roofing. 

Blindly checking “no” to all knowledge of defects is foolhardy and may violate Wisconsin law. Notably, there is also a requirement that sellers amend their RECR if defects are discoverable after completion of the RECR but before an offer is accepted. These representations are legally binding and a buyer is entitled to rely on the RECR. Often, the RECR forms the basis for a lawsuit. Any doubt about a defect should be resolved in favor of disclosure.

The law, to borrow a quote from Winston Churchill, “is a riddle, wrapped in a mystery, inside an enigma; but perhaps there is a key.” That “key” is often found in the Wisconsin Statutes which is affectionally referred to as the book of surprises.  Hence, when faced with the proverbial question of whether “fences make good neighbors” it made sense to scour the Wisconsin Statutes for an answer. Behold!  Such a timely question has an answer and it is: not necessarily. Wisconsin law prohibits the construction of spite fences. In the words of the legislature:

“Any fence, hedge or other structure in the nature of a fence unnecessarily exceeding 6 feet in height, maliciously erected or maintained for the purpose of annoying the owners or occupants of adjoining property, shall be deemed a private nuisance. However, nothing herein contained shall limit the right of a municipality to forbid the erection of a fence less than 6 feet in height.”

Spite fences were not always held in such low esteem in this great State. Circa 1900, from the quaint village of Glenbeulah, Wisconsin comes the case of Metzger v. Hochrein. The Court described Metzger’s property as “surrounded by made lawns and yards, making an attractive and valuable home.” Standing accused of erecting a spite fence, Hochrein set “rough” tamarack posts, from eight to sixteen feet high along the border between the properties. Making things worse, the Court described that between these posts was a “tight board fence of rough, old, unsightly, and partly decayed lumber from an old ice house.” Ignoring the adage to love thy neighbor, the Wisconsin Supreme Court dismissed the case. In language that seems whimsical today, the Court endorsed the right to annoy one’s neighbor:

“This is one of the many cases that may arise where the doctrine of personal liberty and personal dominion of one over his own property enables him to do things to the annoyance of others, not causing actual, material physical discomfort to them, for which there is no punishment, except loss of that respect which every right-thinking man desires from his neighbors, and the possession of which is a source of daily enjoyment. If one is so constituted as not to be susceptible to those feelings which a reasonably well-balanced man is supposed to possess, and is so constituted as to obtain more pleasure out of needlessly annoying others than by securing and retaining their respect as a manly member of society, his sovereign right in his own property, to use it as he may so far as that use does not physically extend outside his boundaries to the detriment of others, may be so exercised as to violate the moral obligations which every member of society owes to his neighbors, without any penalty being visited upon him for his misconduct, of which he can be made conscious.”

However, the unbridled ability to irritate neighbors did not last long. In 1903, an early version of the spite fence statute was passed in reaction to the Supreme Court’s decision in Metzger v. Hochrein. Now, some modern examples help us understand the mash-up of words contained in the spite fence statute. For an example from Utah, would a “Redneck Stonehenge” consisting of three old cars upright in the ground, erected after a neighborly dispute constitute a spite fence? The answer in a word – yes!  Closer to home, a Wisconsin appeals court in the case of Apple Hills Farms v. Price found that an “exposed thirty-two feet long, twelve feet high bare concrete wall” near a property was a spite fence. The facts of the Apple Hills Farms’ case provide a textbook definition of spite. Price, the erector of the wall, told the contractor building the wall that he wanted the wall “ugly” to devalue his neighbor’s property. Surely, it did not help his case that he sprayed grass killer on his neighbor’s lawn to spell “A-hole.” Price’s spite bit him back in the end when the court ordered that he pay his neighbor $150,000.

Upon reflection, the law may not be able to answer the question of whether fences make good neighbors, but it shows that at times, fences certainly make spiteful neighbors. To close, Robert Frost’s poem “Mending Wall” fittingly contains the following contemplative prose: “Before I built a wall I’d ask to know what I was walling in or walling out, and to whom I was like to give offense.”

The governmental immunity statute grants immunity to governments and their officers from certain lawsuits related to intentional wrongful and discretionary acts. Governmental immunity laws trace their origins back to British common law and the idea that the King could do no wrong. Section 893.80 of the Wisconsin Statutes sets forth the general principles of governmental immunity in Wisconsin, including notice requirements, immunity for intentional and discretionary acts, and limits on damages. This article briefly describes governmental immunity and discusses a recent Wisconsin Supreme Court case that applies one of the exceptions to governmental immunity.

Wisconsin courts have described the purpose of the governmental immunity statute in the following terms: “the purpose of immunity provisions is to ensure that courts are not called upon to pass judgment on policy decisions made by members of coordinate branches of government in the context of tort actions, because such actions furnish an inadequate crucible for testing the merits of social, political, or economic decisions.”[1] More simply put, governmental immunity is embodied in the doctrine of separation of powers which divides government responsibilities into distinct branches to limit any one branch from exercising the core functions of another.

There are four narrow exceptions to governmental immunity that have been established in Wisconsin case law. These exceptions allow units of government, or their officers or employees, to be held liable for an action or inaction undertaken in the scope of employment. The exceptions are intended to balance “the need of public officers to perform their functions freely [and] the right of an aggrieved party to seek redress.”

One these exemptions is referred to as the “known danger” exception. It applies in situations in which dangerous circumstances give rise to a ministerial duty to act. Meaning there is no governmental immunity for negligently responding to known dangers that create absolute, certain, and imperative duties.

In January 2019, the Wisconsin Supreme Court reviewed a tragic case where a young girl drowned at a summer camp while under the supervision of the City of New Berlin. The young girl’s parents filed the lawsuit claiming that New Berlin’s camp staff were negligent because the girl did not receive a swim test and was allowed to enter the pool anyway. Specifically, the girl’s parents alerted camp staff to the fact that the girl could not swim, and the camp staff told them that all campers would be provided with a swim test and limited to appropriate areas of the aquatic area accordingly. The camp staff did not provide a swim test and allowed the girl to enter the pool rather than restricting the girl to the splash pad area. New Berlin argued that governmental immunity barred the lawsuit. The Wisconsin Supreme Court determined that New Berlin was not entitled to immunity because the “known danger” exception applied. Writing for the Court, Justice Shirley Abrahamson explained that “the danger to which [the young girl] was exposed at the Aquatic Center as an eight-year-old non-swimmer was compelling and self-evident.”

Despite their best efforts to serve and protect the public, at times, some governmental entities have been proven to be negligent in their duties. If you believe you have a claim against a governmental entity, you must act quickly. Wisconsin requires that the governmental entity being sued be provided with notice of the claim or injury within 120 days after the happening of the event giving rise to the claim.[2] The purpose of this notice is to afford governmental authorities an opportunity to investigate a claim promptly.[3] If you are considering making a claim against a governmental entity or one of its officers, you should contact an attorney right away.

[1] Kara B. v. Dane Cnty., 198 Wis. 2d 24, 55 , 542 N.W.2d 777 (Ct. App. 1995) , aff’d, 205 Wis. 2d 140 , 555 N.W.2d 630 (1996) (quoting Gordon v. Milwaukee Cnty., 125 Wis. 2d 62, 66 , 370 N.W.2d 803 (Ct. App. 1985)

[2] Wis. Stat. § 893.80(1d)(a).

[3] Elkhorn Area Sch. Dist. v. East Troy Cmty. Sch. Dist., 110 Wis. 2d 1, 327 N.W.2d 206 (Ct. App. 1982).

Regardless of the facts, there are certain types of legal cases that restrict the amount of time in which legal action may be taken based on statutes of limitations. Statutes of limitations are laws that set the maximum time after an event within which legal proceedings may be initiated. When that period of time passes, the statute of limitations can be used as a defense to defeat the claim. Such was the case in the recent Wisconsin Supreme Court decision in Mueller v. TL90108, LLC.

Like a Bond film, this captivating story of international intrigue has a rare and exotic automobile at the center of its storyline. Specifically, a French handmade 1938 Talbot-Lago T150C with distinguished coachwork.

In 2001 the car (and title to it) were reported stolen. Under the cover of darkness, the thieves had disassembled the Talbot-Lago from a garage in Milwaukee, Wisconsin and smuggled it to Europe.* In 2015 a company purchased the Talbot-Lago for nearly $7 million. This company is listed as TL90108, LLC in court documents. TL90108 is owned by Illinois dental company founder Rick Workman. When the original owners of the Talbot-Lago found out that it had been purchased by TL90108, LLC in 2017, they sued for return of their property when Workman refused to do so.

Despite having a sordid history, the Supreme Court did not actually take into consideration the car’s history. Instead, their decision was based on the statute of limitations. Here, the statute of limitations for the wrongful conversion or detention of the Talbot-Lago was 6 years. The question the Court had to decide is when the 6-year period began. If it began in 2001 when the car was stolen, then Plaintiff’s claim would be dismissed as stale. However, if the 6-year period began when Workman refused to give back the car in 2017, then the claim was still timely. Because the statute in question very clearly states the 6-year period begins with the theft OR when the wrongful detention began, the Wisconsin Supreme Court allowed Plaintiff’s claim to move forward. The ultimate question of who owns the Talbot-Lago remains unresolved.

*The thieves remain at-large and were not part of the Mueller v. TL90108, LLC lawsuit.

There is little risk in presuming that the majority of homeowners rate their property as their most important asset. Paradoxically, homeowners likely know more about their car insurance than the insurance purchased for the purpose of protecting legal title to their property. Just like no one would want to purchase a car subject to someone else’s car loan, neither do people want to purchase property subject to the former owner’s mortgage or other liens. A homeowner may avoid such problems by obtaining a title insurance policy.

Familiarity with title insurance is usually nothing more than a nuisance charge on a closing statement. Yet, the essential function of a title insurance policy is to provide coverage ensuring the homeowner has good title to the property. If a covered title defect is found, the policy pays the homeowner for actual loss under the terms of the policy, and no more.

As with any insurance policy, it is paramount to understand what is covered. Basically, title insurance is a two-step transaction: the title commitment and title policy. The commitment consists of three parts: Schedule A, Schedule B, and the Conditions.¹ Schedule A lists the name(s) of insured(s), the amount of coverage, a description of the insured property, and the effective date. Schedule B-I provides preliminary requirements to a policy being issued. Schedule B-II lists exceptions to coverage. The commitment also has Conditions found on the commitment cover. Following closing, the policy is issued based upon the commitment if the requirements have been met.

A typical title insurance policy contains certain exceptions concerning title risks that cannot be discovered or evaluated relying solely on public real estate records. The survey exception removes coverage for boundary line disputes. The purpose of the survey exception is to make it clear that the policy does not protect against matters outside a review of real estate records. In other words, matters that would be discovered by a surveyor are not covered by a title insurance policy unless a survey is obtained prior to closing.² Typical language for this exclusion, found on Schedule B of the policy, states:

This policy does not insure against loss or damage (and the Company will not pay costs, attorneys’ fees or expenses) which arise by reason of: Encroachments, overlaps, boundary line disputes, or other matters which would be disclosed by an accurate survey or inspection of the premises.

Essentially, the title company puts the risk of not surveying the property on the insured. The property owner can limit this risk by either obtaining a survey or arranging for the removal of the survey exception.

Removing the survey exception – which can be accomplished by performing a survey per the policy conditions or paying an additional premium – exponentially expands the protection provided by a title insurance policy. For example, when the survey exception is removed, coverage is expanded to include³:

1.  A survey’s failure to show an encroachment of a policyholder’s fence on a neighbor’s property.

2.  The incorrect placement of lot line which causes a policyholder’s cellar door to open on a neighbor’s property.

3.  The incorrect placement of a power line easement 50 feet from the house as opposed to the true of measurement of 5 feet from the house.

4.  An incorrect statement of the amount of acreage.

5.  The encroachment of an insurance holder’s barn onto the neighbor’s property.

Whether you are working with a realtor or purchasing a for sale by owner property, it is important to understand your title insurance policy and the exceptions to coverage. Review your title insurance terms and exceptions to ensure your property is protected. If you have questions about your title insurance policy and what it covers, make sure you call your attorney.

1.  This form is available at the ALTA website: http://www.alta.org/forms/ (last visited June 5, 2017).

2.  Joyce Palomar, Title Insurance Law, § 7.02.

3.  Title and Escrow Claims Guide, 2nd Ed., § 12.3.16 (2013).