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Steiner v. Wisconsin American Mutual Insurance Co.6/9/2005
It is not clear whether the second and final sentence of Wis. Stat. § 846.30 alters the common law, because the common law is not clear. It is not clear that Exchange Corp. altered the portion of St. Joseph's Hospital upon which the plaintiffs rely, despite language in Exchange Corp. disapproving "broader dicta" in St. Joseph's Hospital. As discussed previously, Exchange Corp. suggests equitable title automatically reverts to the vendor without any court order; St. Joseph's Hospital suggests that equitable title reverts to the vendor only upon entry of a final court order.
The last sentence of § 846.30 can be read as WAMIC reads it, that is, as addressing only when a strict foreclosure judgment becomes final, but not addressing the transfer of title. Therefore, the order entered can be viewed under Exchange Corp. as providing finality by confirming a transfer of title to the vendor that has already occurred. Alternatively, the required order in the last sentence of § 846.30 can be read as the plaintiffs read it, that is, as establishing the date on which a land contract vendee's equitable title reverts to the vendor. This reading would be consistent with St. Joseph's Hospital.
Given that the common law is not clear on when equitable title reverts to a land contract vendor, we turn to the practice of attorneys in land contract foreclosure, as well as the legislative drafting records, to cast light on the meaning of Wis. Stat. § 846.30.
Apparently, the practice before the 1995 adoption of Wis. Stat. § 846.30 was for a land contract vendor to obtain a final judgment after the expiration of the redemption period upon filing an affidavit of nonredemption. A 1989 practice manual on land contract foreclosures includes a form for a final judgment in a strict foreclosure of a land contract which states that the final judgment confirms the original judgment and proclaims that "any right, title and interest" of the land contract vendees "shall cease to exist and shall be and hereby are forever barred." This practice suggests that the final judgment or order confirming the strict foreclosure judgment performs a much more significant role than just reaffirming something everyone already knows, namely that equitable title has been vested in the vendor. This final judgment would be needed to clear record title to determine whether the land contract vendee paid the amount due during the redemption period.
The drafting record for Wis. Stat. § 846.30 decidedly supports the plaintiffs' position that if a land contract vendee fails to redeem, the equitable title of the land contract vendee does not pass to the land contract vendor until a circuit court enters an order after the expiration of the redemption period confirming nonredemption. The court of appeals interpreted § 846.30 without examining the drafting record.
The most relevant document in the drafting file on the issue presented in the instant case is a September 29, 1995 letter from the Chicago Title Insurance Company to Atty. Peter Christianson, suggesting what would become the last sentence of Wis. Stat. § 846.30. The letter explains that the purpose of requiring "a final order" is to make the statute consistent with St. Joseph's Hospital. As far as the drafters of § 846.30 were concerned, the St. Joseph's Hospital case was still in full force and effect. The letter does not mention Exchange Corp.
The letter reads in relevant part:
This bill formalizes the requirement for a redemption period after a judgment of strict foreclosure. Such a right has been recognized under [Godwin and Kallenbach]. However, the bill overlooks the requirement for a final order estab
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