Case Title: Pulkkila v. Pulkkila

Citation: 

Docket Number: 2018AP000712-FT

State: wisconsin

Court: Wisconsin Supreme Court

Date: 2020-04-14T00:00:00Z

Document:
2020 WI 34 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2018AP712-FT 
 
 
 
COMPLETE TITLE: 
Joan C. Pulkkila, 
          Petitioner-Appellant, 
     v. 
James M. Pulkkila, 
          Respondent, 
Lynnea Landsee-Pulkkila, 
          Other Party-Respondent-Petitioner. 
 
 
 
 
 
REVIEW OF DECISION OF THE COURT OF APPEALS 
Reported at 386 Wis. 2d 352,927 N.W.2d 164 
(2019 – unpublished) 
 
 
OPINION FILED: 
April 14, 2020   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
October 14, 2019   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Waukesha   
 
JUDGE: 
Paul Bugenhagen Jr.   
 
 
 
JUSTICES: 
 
ANN WALSH BRADLEY, J., delivered the majority opinion of the Court, 
in which ROGGENSACK, C.J., ZIEGLER, and KELLY, JJ.., joined. 
REBECCA GRASSL BRADLEY, J., filed a dissenting opinion.  
NOT PARTICIPATING: 
DALLET and HAGEDORN, JJ.   
 
 
 
ATTORNEYS: 
 
 
For the other party-respondent-petitioner, there were briefs 
filed by Jeffrey A. Mandell, Eileen M. Kelley, Jared M. Potter, 
and Stafford Rosenbaum LLP, Madison and Milwaukee. There was an 
oral argument by Jeffrey A. Mandell. 
 
For the petitioner-appellant, there was a brief filed by 
Daniel J. O’Brien, Angela C. Foy, and Halling & Cayo, S.C., 
Milwaukee. There was an oral argument by Daniel J. O’Brien.  
 
 
 
2 
 
 
 
2020 WI 34
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2018AP712-FT 
(L.C. No. 
2008FA696) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Joan C. Pulkkila, 
 
          Petitioner-Appellant, 
 
     v. 
 
James M. Pulkkila, 
 
          Respondent, 
 
Lynnea Landsee-Pulkkila, 
 
          Other Party-Respondent-Petitioner. 
 
 
 
FILED 
 
APR 14, 2020 
 
Sheila T. Reiff 
Clerk of Supreme Court 
 
 
 
 
ANN WALSH BRADLEY, J., delivered the majority opinion of the Court, 
in which ROGGENSACK, C.J., ZIEGLER, and KELLY, JJ., joined.  REBECCA 
GRASSL BRADLEY, J., filed a dissenting opinion.  
 
DALLET and HAGEDORN, JJ., did not participate. 
 
 
REVIEW of a decision of the Court of Appeals.  Reversed and 
remanded.   
 
¶1 
ANN WALSH BRADLEY, J.   The petitioner, Lynnea Landsee-
Pulkkila (Lynnea), seeks review of an unpublished, authored 
decision of the court of appeals applying a constructive trust to 
No. 
2018AP712-FT   
 
2 
 
proceeds she collected from a life insurance policy maintained by 
her late husband, James Pulkkila (James).1  She asserts that the 
court of appeals erred by determining that constructive trust is 
an available remedy and by applying that remedy. 
¶2 
James and Joan Pulkkila (Joan) divorced in 2009.  They 
arrived at a marital settlement agreement (MSA), which the circuit 
court incorporated in its judgment of divorce.  The MSA contained 
a provision requiring James and Joan to maintain life insurance 
with their children as beneficiaries.  Joan alleges that James 
breached this provision when he made Lynnea, who he married in 
2013, the sole beneficiary of (his) life insurance policy, and 
argues that a constructive trust should be placed on the proceeds. 
¶3 
Lynnea contends that a constructive trust cannot be 
applied to the life insurance proceeds because the MSA provides 
that a lien on James's estate is the exclusive remedy for breach 
of the life insurance provision.  Further, she asserts that the 
court of appeals erred by applying a constructive trust in the 
absence of additional proceedings in the circuit court. 
¶4 
We conclude first that the lien provision of the MSA is 
not an exclusive remedy.  Second, we conclude that the court of 
appeals erred in imposing a constructive trust absent findings of 
fact that would support such an imposition.  We remand to the 
                                                 
1 Pulkkila v. Pulkkila, No. 2018AP712-FT, unpublished slip 
op. (Wis. Ct. App. Feb. 27, 2019) (reversing and remanding order 
of the circuit court for Waukesha County, Paul Bugenhagen, Jr., 
Judge).  
No. 
2018AP712-FT   
 
3 
 
circuit court to engage in factfinding and subsequently determine 
whether to impose a constructive trust in the first instance. 
¶5 
Accordingly, we reverse the decision of the court of 
appeals and remand to the circuit court for further proceedings 
consistent with this opinion. 
I 
¶6 
James and Joan were married in 1996 and divorced in 2009.  
At the time of the divorce, they had two minor children. 
¶7 
As the divorce proceeded, James and Joan negotiated the 
MSA.  They arrived at an agreement and submitted the MSA to the 
circuit court, which incorporated the MSA into its judgment of 
divorce.2   
¶8 
The MSA contains a section entitled, "Life Insurance."  
Pursuant to this section, James and Joan agreed as follows:  
Both parties shall maintain in full force and pay the 
premiums on all life insurance presently in existence on 
their lives or obtain comparable insurance coverage, 
with the parties' minor children named as sole and 
irrevocable primary beneficiaries until the youngest 
minor child reaches the age of majority, or until the 
child has reached the age of 19 so long as the child is 
pursuing an accredited course of instruction leading to 
the acquisition of a high school diploma or its 
equivalent.  During the term of such obligation, each of 
the parties shall furnish the other with copies of such 
policies or evidence of there being such insurance in 
force and proof of beneficiary designation upon request. 
                                                 
2 The Honorable James R. Kieffer presided at the initial 
divorce proceedings, while the Honorable Paul Bugenhagen, Jr., 
presided at the proceedings related to the constructive trust issue 
now before this court. 
No. 
2018AP712-FT   
 
4 
 
¶9 
Further, the "Life Insurance" section of the MSA sets 
forth a remedy in the event either party breaches the provision.  
Specifically, it provides: 
If either party fails for any reason to maintain any of 
the insurance required under this article, there shall 
be a valid and provable lien against his or her estate 
in favor of the specified beneficiary to the extent of 
the difference between the insurance required and the 
actual death benefits received. 
¶10 Prior to the divorce, in 2002, James obtained a $250,000 
life insurance policy from Banner Life.  At the time he obtained 
the policy, James named Joan as the primary beneficiary.   
¶11 In 2013, James and Lynnea were married, and the following 
year James submitted a beneficiary name change request to Banner 
Life, asking that Lynnea be made the sole beneficiary of the 
policy.  James passed away in 2015.  At the time of his death, 
both of his children were minors. 
¶12 Banner Life paid Lynnea the proceeds of the policy.  
Subsequently, Joan filed a motion in the divorce action, seeking 
three iterations of relief.  First, she moved to join Lynnea to 
the action as a third party, asserting that "the proceeds from one 
of [James's] life insurance policies were paid to Ms. Landsee-
Pulkkila in violation of the [Judgment] of Divorce and complete 
relief cannot be accorded unless Ms. Landsee-Pulkkila is joined." 
¶13 Second, Joan moved to enforce the judgment of divorce, 
seeking "an order requiring Ms. Landsee-Pulkkila to return 
proceeds from [James's] life insurance policy that were paid to 
her in violation of the Judgment of Divorce in this matter and for 
such other relief as the Court deems appropriate."  Third, Joan 
No. 
2018AP712-FT   
 
5 
 
moved to establish a constructive trust for her and James's 
children's benefit over the life insurance proceeds that were paid 
to Lynnea. 
¶14 The circuit court held a hearing on the motion and 
ultimately denied Joan's motion for a constructive trust, 
reasoning that the MSA unambiguously provided that a lien on 
James's estate is the exclusive remedy for breach of the life 
insurance provision.  Because it determined the lien remedy to be 
exclusive, it concluded that a constructive trust was not an 
available remedy.  It explained: 
[T]he Court's job isn't to go back and fix the parties' 
agreement to make it fair now for the children.  It's 
not fair they're not getting as much money.  They lost 
their father.  It is a rotten deal for them.  However, 
this Court has to follow the law on it.  The contract is 
not ambiguous to this Court.  That is simply a question 
of law. . . . It is clear to this Court that that was 
the bargaining, and I'm not going to step outside of 
their agreement to provide for other remedies. 
¶15 Additionally, the circuit court expressly declined to 
address several of the issues raised by Joan's motion and Lynnea's 
response, reasoning that such issues could be addressed if 
necessary on remand from an appellate court.  It stated, "I believe 
that if I am overturned, the Court will give some instructions 
that we have to have a hearing as to what to do with this 
constructive trust."  It further stated that it would not be taking 
up the issue of whether the proper parties were before the court, 
but again, it may do so on remand if necessary:  "The Court may or 
may not take up the issue of whether or not we have the proper 
No. 
2018AP712-FT   
 
6 
 
parties to this, that is the question I'm not reaching today.  So 
the Court may send that back with directions as well." 
¶16 Joan appealed, and the court of appeals reversed and 
remanded.  Pulkkila v. Pulkkila, No. 2018AP712-FT, unpublished 
slip op., ¶1 (Wis. Ct. App. Feb. 27, 2019).  First, it rejected 
the circuit court's conclusion that the lien remedy in the MSA is 
an exclusive remedy.  Id., ¶9.  Specifically, it determined that 
such a remedy was "meaningless" under the facts of this case 
because James's estate contained nowhere near enough money to 
provide for his children in the manner the life insurance proceeds 
would have:  "The problem with this argument is that the remedy is 
meaningless.  Equity might allow for James' wrongdoing if his 
estate had $250,000, but it did not.  It had $5600.  James' new 
wife cites no case law, and we have found none, where under these 
or similar factual circumstances, a constructive trust is 
unavailable if a meaningless remedy exists."  Id. 
¶17 The court of appeals determined next that "[t]he 
equities of this case mandate the creation of a constructive trust 
in favor of the children so as to accomplish the intent of the 
MSA."  Id., ¶10.  In the court of appeals' view, "[a]ll of the 
requirements of a constructive trust have been satisfied:  James' 
new wife received and retained a benefit, which was unjust to 
James' children who were denied their guaranteed means of support, 
and the aforementioned unjust enrichment was the result of James' 
wrongful conduct in violating the MSA."  Id.  Accordingly, it 
concluded that "[e]quity requires the imposition of a constructive 
trust."  Id.  Lynnea petitioned this court for review. 
No. 
2018AP712-FT   
 
7 
 
II 
¶18 We are called upon to review the court of appeals' 
decision determining that a constructive trust must be imposed.  A 
decision to impose a constructive trust is subject to a two-tiered 
standard of review.  Sulzer v. Diedrich, 2003 WI 90, ¶16, 263 
Wis. 2d 496, 664 N.W.2d 641.  Legal issues, such as the 
interpretation of a marital settlement agreement, are reviewed 
independently of the determinations rendered by the circuit court 
and court of appeals.  Id.; see Topolski v. Topolski, 2011 WI 59, 
¶28, 335 Wis. 2d 327, 802 N.W.2d 482.   
¶19 However, the ultimate decision of whether to grant the 
equitable relief of a constructive trust is reviewed for an 
erroneous exercise of discretion.  Sulzer, 263 Wis. 2d 496, ¶16; 
Pluemer ex rel. Buggs v. Pluemer, 2009 WI App 170, ¶9, 322 
Wis. 2d 138, 776 N.W.2d 261.  An exercise of discretion is 
erroneous if it is based on an error of law or fact.  Horizon Bank, 
Nat'l Ass'n v. Marshalls Point Retreat LLC, 2018 WI 19, ¶29, 380 
Wis. 2d 60, 908 N.W.2d 797.  A discretionary determination will be 
upheld as long as the court "examined the relevant facts, applied 
a proper standard of law, and, using a demonstrated rational 
process, reached a conclusion that a reasonable judge could reach."  
LeMere v. LeMere, 2003 WI 67, ¶13, 262 Wis. 2d 426, 663 N.W.2d 789 
(quoting Long v. Long, 196 Wis. 2d 691, 695, 539 N.W.2d 462 (Ct. 
App. 1995)). 
III 
¶20 We initially examine the MSA to determine if a lien on 
James's estate is the exclusive remedy for a breach of the life 
No. 
2018AP712-FT   
 
8 
 
insurance provision.  Subsequently, we turn to address whether the 
court of appeals properly applied a constructive trust to the life 
insurance proceeds in Lynnea's possession.  Finally, we provide 
guidance to the circuit court as it conducts proceedings on remand. 
A 
¶21 As stated, James and Joan, through the negotiation of 
the MSA and the subsequent incorporation of the MSA in the circuit 
court's judgment of divorce, agreed that "[b]oth parties shall 
maintain in full force and pay the premiums on all life insurance 
presently in existence on their lives or obtain comparable 
insurance coverage, with the parties' minor children named as the 
sole and irrevocable primary beneficiaries . . . ."  The MSA 
further provides a remedy in the event either party breaches the 
provision:   
If either party fails for any reason to maintain any of 
the insurance required under this article, there shall 
be a valid and provable lien against his or her estate 
in favor of the specified beneficiary to the extent of 
the difference between the insurance required and the 
actual death benefits received. 
¶22 Lynnea contends that the remedy provision sets forth a 
single and exclusive remedy in the event of either party's breach 
of the life insurance requirement in the MSA:  a lien against the 
estate of the breaching party.  In contrast, Joan asserts that the 
lien provision is not an exclusive remedy and that as a result 
other remedies, including constructive trust, are available. 
¶23 We agree with Joan on this point.  Although the remedy 
provision states that there "shall" be a lien, it does not follow 
No. 
2018AP712-FT   
 
9 
 
that all other remedies are inapposite.  There is no such limiting 
language in the MSA. 
¶24 This result is compelled regardless of whether we label 
the MSA as a judgment of the circuit court or as a contract.  If 
we call the MSA a judgment, we follow this court's precedent 
indicating that "[a] divorce judgment that is clear on its face is 
not open to construction."  Washington v. Washington, 2000 WI 47, 
¶17, 234 Wis. 2d 689, 611 N.W.2d 261.  The MSA is clear on its 
face——although a lien on James's estate is plainly an available 
and mandatory remedy for breach of the life insurance provision, 
there is no limiting language that would indicate that it is the 
only remedy for such a breach.  
¶25 Similarly, if we call the MSA a contract, Lynnea's 
argument fares no better.  "Although the parties may, in their 
contract, specify a remedy for a breach thereof, that specification 
does not exclude other legally recognized remedies.  A contract 
will not be construed as taking away a common-law remedy unless 
that result is imperatively required."  Local 248 UAW v. Natzke, 
36 Wis. 2d 237, 251, 153 N.W.2d 602 (1967); see also Coleman v. 
Percy, 86 Wis. 2d 336, 340, 272 N.W.2d 118 (Ct. App. 1978) 
(explaining that "a contract will not be construed to take away a 
common law remedy unless that result is imperatively required"). 
¶26 Further, adopting Lynnea's argument would run afoul of 
the maxim that we "will not read words into the contract that the 
parties opted not to include."  Ash Park, LLC v. Alexander & 
Bishop, Ltd., 2015 WI 65, ¶66, 363 Wis. 2d 699, 866 N.W.2d 679.  
As a result, although the MSA is clear that a lien is a remedy, we 
No. 
2018AP712-FT   
 
10 
 
decline to read in language indicating that a lien is the exclusive 
remedy. 
¶27 Accordingly, we conclude that the lien provision of the 
MSA is not an exclusive remedy. 
B 
¶28 We turn now to address whether the court of appeals 
properly applied a constructive trust to the life insurance 
proceeds in Lynnea's possession. 
¶29 "A constructive trust is an equitable device used to 
prevent unjust enrichment which arises when a party receives a 
benefit the retention of which is unjust to another party."  
Sulzer, 263 Wis. 2d 496, ¶20 (citing Wilharms v. Wilharms, 93 
Wis. 2d 671, 678-79, 287 N.W.2d 779 (1980)).  Conceptually, it is 
a remedy "used to address situations in which the legal and 
beneficial interests in a particular piece of property lie with 
different people."  Tikalsky v. Friedman, 2019 WI 56, ¶¶18-19, 386 
Wis. 2d 757, 928 N.W.2d 502.   
¶30 Unjust enrichment by itself is not sufficient to require 
the imposition of a constructive trust.  Sulzer, 263 Wis. 2d 496, 
¶20.  Indeed, a constructive trust will be imposed only where there 
is a demonstration of unjust enrichment accompanied by an 
"additional showing" of "actual or constructive fraud, duress, 
abuse of confidence, mistake, commission of a wrong, or by any 
form of unconscionable conduct" that has caused the one against 
whom a trust is imposed to either obtain or hold the legal title 
to property which that person ought not in equity and good 
conscience to enjoy.  Tikalsky, 386 Wis. 2d 757, ¶21 (quoting 
No. 
2018AP712-FT   
 
11 
 
Gorski v. Gorski, 82 Wis. 2d 248, 254-55, 262 N.W.2d 120 (1978)).  
In short, both unjust enrichment and the "additional showing" are 
required.  Id. 
¶31 In this case, the circuit court did not reach the issue 
of whether to apply a constructive trust because it determined 
that constructive trust was not an available remedy.  It therefore 
found no facts and took no evidence.   
¶32 The court of appeals, on the other hand, concluded that 
a constructive trust was not only available but that it was 
necessary.  In the court of appeals' view, "[t]he equities of this 
case mandate the creation of a constructive trust in favor of the 
children so as to accomplish the intent of the MSA."  Pulkkila, 
No. 2018AP712-FT, unpublished slip op., ¶10. 
¶33 By imposing a constructive trust in the absence of any 
factfinding by the circuit court, the court of appeals in this 
case jumped the gun.  As stated, the imposition of a constructive 
trust requires a demonstration of unjust enrichment accompanied by 
the "additional showing" set forth in Tikalsky, 386 Wis. 2d 757, 
¶21.  Without the benefit of factfinding by the circuit court, 
such an "additional showing" cannot be demonstrated.   
¶34 Whether 
to 
impose 
a 
constructive 
trust 
is 
a 
discretionary determination that must be made through examination 
of the relevant facts.  See Pluemer, 322 Wis. 2d 138, ¶9 
(explaining that the decision as to whether to impose a 
constructive trust, as a discretionary determination, will be 
sustained on appeal if the circuit court "examined the relevant 
facts, applied the proper standard of law, and, using a 
No. 
2018AP712-FT   
 
12 
 
demonstrated rational process, reached a conclusion that a 
reasonable judge could reach").  The circuit court here did not 
examine the relevant facts because it did not reach the 
constructive trust issue, and the court of appeals did not examine 
the relevant facts because the circuit court had found none.   
¶35 Additionally, case law indicates that "[t]he extent to 
which a constructive trust should be imposed upon . . . insurance 
proceeds can only be determined after an evidentiary hearing and 
a careful and equitable consideration of all relevant factors."  
Pluemer, 322 Wis. 2d 138, ¶23 (quoting Prince v. Bryant, 87 
Wis. 2d 662, 673, 275 N.W.2d 676 (1979)).  Like the "additional 
showing" requirement, the "extent" of any constructive trust that 
should be imposed cannot be demonstrated in a record vacuum, in 
the absence of factual findings.  Accordingly, the court of appeals 
erroneously exercised its discretion because it determined that a 
constructive trust was appropriate in the absence of an evidentiary 
hearing and resulting relevant factual findings. 
¶36 The circuit court here correctly recognized that 
factfinding would be necessary in the event of a remand.  It 
stated, "I believe that if I am overturned, the Court will give 
some instructions that we have to have a hearing as to what to do 
with this constructive trust."  The court of appeals' decision 
effectively short-circuits the circuit court's well-reasoned 
expectation and opportunity to consider such an issue.   
¶37 Accordingly, we conclude that the court of appeals erred 
in imposing a constructive trust absent findings of fact that would 
No. 
2018AP712-FT   
 
13 
 
support such an imposition.3  We remand to the circuit court to 
engage in factfinding and subsequently determine whether to impose 
a constructive trust in the first instance. 
¶38 On remand, the circuit court will necessarily conduct an 
evidentiary hearing.  See Pluemer, 322 Wis. 2d 138, ¶23.  From the 
evidence deduced at this hearing, the circuit court will determine 
whether a constructive trust should be imposed, and if so, to what 
extent.   
¶39 Whether to impose a constructive trust presents a fact-
intensive inquiry.  See Prince, 87 Wis. 2d at 667-68 (explaining 
that "in imposing the doctrine [of constructive trust] each case 
must be considered in the factual situation presented" and that 
"[e]quitable remedies must, of necessity, place heavy reliance on 
the facts of the particular controversy.").  In reaching its 
determination, the circuit court may take into account "factors 
brought to its attention by the parties relating to the equity of 
the distribution.  It may then make an apportionment of the 
proceeds, granting or denying a constructive trust as to all or a 
part of the property."  Wilharms, 93 Wis. 2d at 681.  Equitable 
                                                 
3 Lynnea asserts in her briefs that the court of appeals' 
imposition of a constructive trust absent further proceedings in 
the circuit court constitutes a violation of due process.  We need 
not address Lynnea's due process argument because we resolve this 
case based on the common law of constructive trust.  "This court 
has frequently concluded that it need not address a claim of 
constitutional error if the claim can be resolved on statutory or 
common law grounds."  State v. Dyess, 124 Wis. 2d 525, 533, 370 
N.W.2d 222 (1985) (citations omitted). 
No. 
2018AP712-FT   
 
14 
 
principles favoring each party are appropriate considerations.  
See Pluemer, 322 Wis. 2d 138, ¶23.   
¶40 The circuit court in this case may also take up 
additional issues on remand.  It may address those issues it finds 
pertinent that it did not reach due to its previous determination 
that a lien is the exclusive remedy.4 
IV 
¶41 In sum, we conclude first that the lien provision of the 
MSA is not an exclusive remedy.  Second, we conclude that the court 
of appeals erred in imposing a constructive trust absent findings 
of fact that would support such an imposition.  We remand to the 
circuit court to engage in factfinding and subsequently determine 
whether to impose a constructive trust in the first instance. 
¶42 Accordingly, we reverse the decision of the court of 
appeals and remand to the circuit court for further proceedings 
consistent with this opinion. 
By the Court.—The decision of the court of appeals is reversed 
and the cause is remanded to the circuit court for further 
proceedings consistent with this opinion. 
¶43 REBECCA FRANK DALLET and BRIAN HAGEDORN, JJ., did not 
participate. 
                                                 
4 As stated, the circuit court also indicated that it would 
address issues of standing and proper parties on remand:  "The 
Court may or may not take up the issue of whether or not we have 
the proper parties to this, that is the question I'm not reaching 
today."   
No.  2018AP712-FT.rgb 
 
1 
 
 
¶44 REBECCA GRASSL BRADLEY, J.   (dissenting).  For nearly 
85 years, marital settlement agreements ("MSAs") have been 
regarded as contracts under Wisconsin law, and once approved by 
circuit courts and entered as judgments, divorcing parties have 
organized their families' lives and financial affairs in reliance 
upon their terms.  By supplanting the contractual remedy chosen by 
James and Joan Pulkkila——and approved by the circuit court judge—
—with an equitable remedy unavailable under black letter contracts 
law, the majority calls into question nearly century-old law, 
disturbs the long-settled expectations and reliance interests of 
thousands of divorced Wisconsin citizens, and leaves their 
negotiated marital settlements subject to the whim of judges.  
Divorced Wisconsinites beware:  from this day forward, a court may 
at any time rewrite the terms of your marital settlement agreement 
if your former spouse comes to court pleading "unfair." 
¶45 There is no dispute that before James died, he violated 
the life insurance provision of the MSA by naming his spouse the 
beneficiary instead of his daughters.  In the MSA, he had agreed 
to maintain his daughters as beneficiaries until the youngest 
reached 
adulthood, 
but 
he 
failed 
to 
do 
so.1 
 
James' 
breach 
triggered 
                                                 
1 This case involves the perpetuation of a significant factual 
error with respect to the older daughter's birthdate.  The Judgment 
of Divorce, Joan's affidavit, and multiple other documents in the 
record list B.P.'s birthdate as August 18, 1988, which would have 
made her 27 years old——and not a minor——when her father died.  This 
factual error went uncorrected in the court of appeals and in this 
court until the court raised it during oral argument.  Joan's 
lawyer failed to correct this factual error until confronted by 
the court.  Appellate courts rely on the record and the facts it 
contains.  Lawyers have a duty "to correct a false statement of 
material fact or law previously made to the tribunal by the 
No.  2018AP712-FT.rgb 
 
2 
 
the remedy specified in the MSA's life insurance provision, for 
which James and Joan fought "tooth and nail."  This court should 
honor the parties' contractual remedy, enforce the MSA, and affirm 
the circuit court.  Instead, the majority dismisses the MSA's 
contractual provisions as non-exclusive and authorizes the circuit 
court to consider imposing the extra-contractual and equitable 
remedy of a constructive trust. 
¶46 I write separately to clarify that:  (1) MSAs are 
contracts; (2) incorporation of an MSA into a divorce judgment 
does not alter its contractual nature; and (3) the remedy provided 
by the MSA and approved by the circuit court should be enforced.  
Whether the MSA was a contract was never in dispute.  All parties 
agree the MSA was a contract between James and Joan and that the 
circuit court approved its provisions in 2009 by incorporating the 
MSA into the divorce judgment.  The sole issues presented to this 
court were whether the MSA's specified remedy for breach of the 
insurance provision was the exclusive remedy, rendering a 
constructive trust unavailable and whether the court of appeals 
violated Lynnea's due process rights by imposing one. 
¶47 By implying that an MSA loses its contractual nature 
after its incorporation into the circuit court's judgment, the 
majority destabilizes black letter divorce law.  Treating an MSA 
as a judgment subject to equitable modification by a court would 
introduce a drastic sea change in the treatment of existing MSAs 
to the detriment of parties who reasonably expected finality once 
                                                 
lawyer."  SCR 20:3.3.  Joan's lawyer should have notified both the 
court of appeals as well as this court of the error. 
No.  2018AP712-FT.rgb 
 
3 
 
their divorce judgments were entered.  MSAs are contracts, remain 
so post-judgment, and should be enforced according to the terms 
for which the parties fought "tooth and nail."  I would reverse 
the court of appeals decision imposing a constructive trust and 
reinstate the order of the circuit court.  I respectfully dissent. 
I 
¶48 MSAs have been treated as contracts by this court for at 
least 83 years: 
 Vaccaro v. Vaccaro, 67 Wis. 2d 477, 486, 227 N.W.2d 62 (1975) 
(holding that not all stipulations in divorce proceedings are 
contracts, but "contractual obligations arise only in 
situations where the court expressly refers to and approves 
a formal agreement between the parties, and not where, as 
here, the court merely adopts and to some extent modifies the 
parties' joint recommendations as to alimony, support or 
property settlement."). 
 May v. May, 2012 WI 35, ¶¶4, 18, 339 Wis. 2d 626, 813 
N.W.2d 179 (dealing with child support set forth in an MSA 
incorporated by the divorce judgment, stating "we are 
sensitive to the importance and prevalence of stipulations in 
helping families going through difficult and litigious 
divorces and curbing disagreements [between] the parties.  
The ability to contract is fundamental to our legal system 
and may aid parties in settling their divorces more amicably."  
(emphasis added) (quoting Frisch v. Henrichs, 2007 WI 102, 
¶75, 304 Wis. 2d 1, 736 N.W.2d 85). 
No.  2018AP712-FT.rgb 
 
4 
 
 Topolski v. Topolski, 2011 WI 59, ¶¶26-49, 335 Wis. 2d 327, 
802 
N.W.2d 482 
(applying 
principles 
of 
contract 
interpretation to an MSA and the standard of review for 
written instruments). 
 Schmidt v. Schmidt, 40 Wis. 2d 649, 653, 162 N.W.2d 618 
(1968) ("Stipulations in divorce actions are in the nature of 
a contract."  (citing In re Estate of Boyd, 18 Wis. 2d 379, 
118 N.W.2d 705 (1963))). 
 In re Estate of Boyd, 18 Wis. 2d 379, 381, 118 N.W.2d 705 
(1963) ("A stipulation in a divorce action is in the nature 
of a contract."  (citing Miner v. Miner, 10 Wis. 2d 438, 444, 
103 N.W.2d 4 (1960)), abrogated on other grounds by Rohde-
Giovanni v. Baumgart, 2004 WI 27, 269 Wis. 2d 598, 676 
N.W.2d 452). 
 Miner v. Miner, 10 Wis. 2d at 443-44, ("[T]here may be 
situations in which the parties enter into a formal contract 
or written agreement outside of court in which they finally 
settle all their financial rights and duties toward each other 
in 
contemplation 
of 
the 
uncertainties 
of 
the 
future. . . .  When the court merely refers to such an 
agreement and approves it without making the provisions 
thereof a part of its judgment, the weight of authority is 
that such an agreement is not subject to modification by the 
court. . . .  The arrangement is contractual, not a judicial 
determination, and therefore no more subject to change by the 
court than the terms of any other private agreement."). 
No.  2018AP712-FT.rgb 
 
5 
 
 Frisch v. Henrichs, 2007 WI 102, ¶¶30, 75, 304 Wis. 2d 1, 736 
N.W.2d 85 ("This case also requires us to review the 1996 
stipulation agreement between the parties.  The construction 
of a written contract is a question of law that we review de 
novo."  (citation omitted); "[W]e are sensitive to the 
importance and prevalence of stipulations in helping families 
going through difficult and litigious divorces and curbing 
disagreements among the parties.  The ability to contract is 
fundamental to our legal system and may aid parties in 
settling their divorces more amicably.")  
 Wright v. Wright, 92 Wis. 2d 246, 248, 255, 284 N.W.2d 894 
(1979) (dealing with a divorce judgment, while stating 
"[j]udgments are to be construed in the same manner as other 
written instruments."  (citing Vaccaro, 67 Wis. 2d at 482)). 
 In re Will of Koeffler, 218 Wis. 560, 561, 563-65, 260 
N.W. 638 (1935) (referring to an "antenuptial agreement or 
marriage settlement" as a "marriage settlement contract"). 
(emphasis added). 
¶49 MSAs have been treated as contracts by the Wisconsin 
Court of Appeals in many more cases: 
 Pulkkila v. Pulkkila, No. 2018AP712-FT, unpublished slip op., 
¶6 (Wis. Ct. App. Feb. 27, 2019) ("Importantly, the law of 
constructive trusts does not require a finding that the 
contractual language is ambiguous."  (emphasis added)). 
 North v. Farris, No. 2015AP1466, unpublished slip op., *2 
(Wis. Ct. App. June 23, 2016) ("A marital settlement agreement 
is a type of contract."). 
No.  2018AP712-FT.rgb 
 
6 
 
 Winters v. Winters, 2005 WI App 94, ¶¶15, 17, 21, 281 
Wis. 2d 798, 699 N.W.2d 229 ("This issue requires us to 
interpret the language of the marital settlement agreement, 
which is a contract and subject to de novo review."  (citing 
Taylor v. Taylor, 2002 WI App 253, ¶7, 258 Wis. 2d 290, 653 
N.W.2d 524); applying principles of contract interpretation 
to the MSA; holding "the terms of the marital settlement 
agreement require . . . "). 
 Taylor v. Taylor, 2002 WI App 253, ¶7, 258 Wis. 2d 290, 653 
N.W.2d 524 ("This appeal, however, requires us to interpret 
the language of a marital settlement agreement, which is 'in 
the nature of a contract,' the construction of which is a 
question of law we review do novo."  (citing Rosplock v. 
Rosplock, 217 Wis. 2d 22, 30, 577 N.W.2d 32 (Ct. App. 1998)); 
applying principles of contract interpretation to the MSA and 
concluding its terms are not ambiguous). 
 Rosplock v. Rosplock, 217 Wis. 2d 22, 30, 577 N.W.2d 32 (Ct. 
App. 1998) (applying contract principles to the parties' 
written stipulation for maintenance while stating "[a] 
stipulation incorporated into a divorce judgment is in the 
nature of a contract."). 
 Koonce v. Koonce, No. 00-2279-FT, unpublished slip op., ¶¶5-
6 (Wis. Ct. App. Dec. 27, 2000) ("At issue is the 
interpretation of a marital settlement agreement.  A 
stipulation incorporated into a divorce judgment is in the 
nature of a contract."  (citation omitted); concluded the MSA 
was unambiguous). 
No.  2018AP712-FT.rgb 
 
7 
 
 Paulson v. Lutze, No. 2015AP230-FT, unpublished slip op., ¶12 
(Wis. Ct. App. Oct. 20, 2015) (per curiam) ("Just like the 
premarital agreement in 
Jones, the Paulsons' marital 
settlement agreement is a binding contract, in writing, and 
as such, it is an affirmative act where the parties are 
intentionally relinquishing known rights."  (citing Jones v. 
Estate of Jones,  2002 WI 61, ¶17, 253 Wis. 2d 158, 646 
N.W.2d 280)). 
 Winters v. Winters, No. 2007AP909, unpublished slip op., ¶7 
(Wis. Ct. App. Aug. 27, 2008) (per curiam) ("Because a marital 
settlement agreement is a contract, the interpretation of its 
language is subject to de novo review."  (citing Winters, 281 
Wis. 2d 798, ¶15)). 
 Jalovec v. Jalovec, 2007 WI App 206, ¶¶4, 10 305 Wis. 2d 467, 
739 N.W.2d 834 (With respect to the interpretation of an MSA, 
"[r]esolution of this issue requires us to construe the 
stipulation agreement between the parties.  The construction 
of a written contract is a question of law" and holding the 
MSA violated public policy because it restricted the 
availability of child support modification). 
 Ondrasek v. Tenneson, 158 Wis. 2d 690, 692-94, 462 N.W.2d 915 
(Ct. App. 1990) ("The parties . . . entered into a marital 
settlement agreement. . . .  The marital settlement agreement 
was incorporated into the judgment of divorce. . . .  The 
construction of a written contract is normally a matter of 
law for the court.") (footnotes omitted; citations omitted). 
No.  2018AP712-FT.rgb 
 
8 
 
 Grosshans v. Grosshans, No. 2005AP1770, unpublished slip op., 
¶¶2, 5-6 (Wis. Ct. App. July 6, 2006) (per curiam) (calling 
an MSA "a contract," and applying "standard principles of 
contract construction" such as looking to the intent of the 
parties and holding the contract ambiguous). 
 Duhame ex rel. Corrigan v. Duhame, 154 Wis. 2d 258, 264-65, 
453 N.W.2d 149 (1989) ("The language at issue here was the 
result of a stipulation between the parties to the divorce.  
A stipulation is in the nature of a contract and the trial 
court must seek a construction which will effectuate what 
appears to have been the intention of the parties."  
(citations omitted)). 
 Pluemer ex rel. Buggs v. Pluemer, 2009 WI App 170, ¶14, 322 
Wis. 2d 138, 776 N.W.2d 261 ("A stipulation is in the nature 
of a contract and the trial court must seek a construction 
which will effectuate what appears to have been the intention 
of the parties."  (quoting Duhame, 154 Wis. 2d at 264)). 
 Kastelic v. Kastelic, 119 Wis. 2d 280, 287, 350 N.W.2d 714 
(Ct. App. 1984) ("In divorce actions, stipulations are in the 
nature of a contract."  (citing Schmidt, 40 Wis. 2d at 653)). 
 Yacoub v. Yacoub, No. 2015AP2557, unpublished slip op., ¶18 
(Wis. Ct. App. Mar. 14, 2017) (per curiam) ("'The construction 
of a written contract presents a question of law which we 
review do novo.'  If the contractual terms are clear and 
unambiguous, as they are [in the MSA] here, we interpret the 
contract without considering extrinsic sources."  (citations 
omitted)). 
No.  2018AP712-FT.rgb 
 
9 
 
 Wieland v. Wieland, No. 2010AP3066, unpublished slip op., 
¶10, (Wis. Ct. App. Mar. 28, 2012) (per curiam) (noting "[t]he 
record shows that the [marital settlement] agreement was a 
comprehensive contract," in response to a claim of estoppel 
preventing modification of the judgment). 
 Smith v. Smith, No. 00-2123, unpublished slip op., ¶¶5-6, 8 
(Wis. Ct. App. Feb. 21, 2001) (referring to an MSA 
incorporated into a divorce judgment as a "contract" and 
applying contract principles). 
 Dickau v. Dickau, 2012 WI App 111, ¶¶14, 20, 344 Wis. 2d 308, 
824 N.W.2d 142 ("We apply the rules of contract construction 
to a divorce judgment . . . This is true even when the divorce 
judgment is based on the parties' stipulation. . . . In 
divorce actions, stipulations are in the nature of a 
contract."  (quoting Waters v. Waters, 2007 WI App 40, ¶6, 
300 
Wis. 2d 224, 
730 
N.W.2d 655) 
(applying 
contract 
principles to the divorce judgment)). 
 Wagner v. Estate of Sobczak, 2011 WI App 159, ¶7, 338 
Wis. 2d 92, 
808 
N.W.2d 167 
("[T]he 
marital 
settlement 
agreement in this case . . . was incorporated into the final 
judgment of divorce.  A judgment [of divorce] is interpreted 
in the same manner as other written documents."  (citation 
omitted); discussing principles of contract construction for 
the divorce judgment incorporating the MSA). 
 Reetz v. Reetz, No. 2013AP472, unpublished slip op., ¶7 (Wis. 
Ct. App. Oct. 24, 2013) ("[T]he parties dispute whether the 
circuit court correctly construed subsection (f) of the 
No.  2018AP712-FT.rgb 
 
10 
 
marital settlement agreement, which, as we have stated, was 
incorporated into the judgment of divorce.  The construction 
of a divorce judgment is a legal issue that we review 
independently of the circuit court.  We apply the rules of 
contract construction to a divorce judgment, including where, 
as here, 'the divorce judgment is based on the parties' 
stipulation.'"  (footnotes omitted; internal citations 
omitted)). 
 Waters v. Waters, 2007 WI App 40, ¶¶2, 6, 300 Wis. 2d 224, 
730 N.W.2d 655 (with respect to a "Final Stipulation-Marital 
Settlement Agreement," "[w]e apply the rules of contract 
construction to a divorce judgment . . . This is true even 
when the divorce judgment is based on the parties' 
stipulation . . .  In divorce actions, stipulations are in 
the nature of a contract."  (citations omitted)). 
 Hutjens v. Hutjens, 2002 WI App 162, ¶¶2-24, 256 Wis. 2d 255, 
647 N.W.2d 448 (applying principles of contract construction 
to an amended divorce judgment originally based on an MSA).  
 Henkel v. West, No. 99-0724, unpublished slip op., ¶15 (Wis. 
Ct. App. Dec. 30, 1999) ("A marital settlement agreement or 
stipulation that is 'incorporated into a divorce judgment is 
in the nature of a contract.'"  (citing Rosplock, 217 
Wis. 2d at 30); "However, unlike with contract law, in a 
divorce, a trial court can modify certain terms of the 
agreement based on a 'substantial change in circumstances' 
despite the original intention of the parties."  (citing Wis. 
Stat. § 767.32(1)(a))). 
No.  2018AP712-FT.rgb 
 
11 
 
 Murray v. Murray, 231 Wis. 2d 71, 80, 604 N.W.2d 912 (Ct. 
App. 1999) (citing to an MSA favorably for its language that 
"[t]his agreement is a legally binding contract" before 
finding no substantial change in circumstances to modify 
support).  
 Pinter v. Pinter, No. 95-2620-FT, unpublished slip op., *2 
(Wis. Ct. App. May 7, 1996) (per curiam) (holding that an MSA 
incorporated into a divorce judgment was unambiguous in 
requiring the husband to keep the first wife as a beneficiary 
on the life insurance policy instead of the second wife; and 
"[a] judgment is interpreted in the same manner as other 
written documents."  (citing Jacobson v. Jacobson, 177 
Wis. 2d 539, 546, 502 N.W.2d 869 (Ct. App. 1993)). 
 Kaplan v. Kaplan, No. 93-0478-FT, unpublished slip op., *1-2 
(Wis. Ct. App. Jan. 5, 1994) (per curiam) (applying contract 
principles to the "interpretation of the parties' marital 
settlement agreement"). 
 Jacobson v. Jacobson, 177 Wis. 2d 539, 542, 546-47, 502 
N.W.2d 869 (Ct. App. 1993) (addressing a stipulation of the 
parties in a divorce proceeding with respect to child support, 
insurance, 
property 
division, 
debts, 
and 
maintenance, 
ultimately incorporated into the judgment, and stating "[a] 
court interprets a judgment in the same manner as other 
written instruments . . . [w]hether the contract is ambiguous 
is a question of law . . . .  Only when judgments are 
ambiguous is construction permitted[.]"  (internal citations 
omitted)). 
No.  2018AP712-FT.rgb 
 
12 
 
 Wilke v. Wilke, 212 Wis. 2d 271, 272-73, 569 N.W.2d 296 (Ct. 
App. 1997) (with respect to a "marital settlement agreement" 
approved by circuit court and incorporated into divorce 
judgment, which divided marital property: "This appeal 
addresses the effect a clause of mutual release contained in 
the marital property agreement executed by Scott and Judith 
as part of their judgment of divorce has on the restrictive 
stock agreement . . . .  Insofar as both documents constitute 
contracts, their respective construction is a legal question 
reviewed independently[.]"  (citation omitted)). 
¶50 In accordance with Wisconsin cases, MSAs have been 
regarded as contracts by secondary sources: 
 Jay E. Grenig & Nathan A. Fishbach, Wisconsin Practice Series: 
Methods of Practice Form 42-13 (5th ed. 2019) (referring to 
MSA as "a legally binding contract."). 
 Gregg M. Herman & Kelley J. Shock, Family Law In Wisconsin:  
A Forms and Procedures Handbook Vol. 2 (9th ed. 2017) 
(distinguishing between an MSA, which is a contract and 
stipulations 
between 
the 
parties 
that 
are 
just 
an 
"understanding of what the parties desire[.]"). 
 Kelvin H. Dickinson, Divorce and Life Insurance:  Post Mortem 
Remedies for Breach of a Duty to Maintain a Policy for a 
Designated Beneficiary, 61 Mo. L. Rev. 533, 551-52 (1996) 
("Although many divorce agreements are essentially contracts, 
and, thus, governed by standard contract principles, divorce 
itself is still a matter regulated by statute and administered 
by courts."  (emphasis added; internal footnotes omitted)). 
No.  2018AP712-FT.rgb 
 
13 
 
 Adam W. Lasker, Joint Parenting Agreement Allows Mother to 
Remove Children to California, 100 Ill. B.J. 579 (2012) ("A 
JPA, like a marital settlement agreement (MSA), is a contract 
between the parties and, as such, a court's primary objective 
is to give effect to the intent of the parties, which must be 
determined only by the language of the agreement, absent an 
ambiguity[.]"  (emphasis added; quoted source omitted)).  
 Timothy Arcaro & Laura Miller Cancilla, The Illusory 
Imputation of Income in Marital Settlement Agreements:  "The 
Future Ain't What it Used to Be," 35 Nova L. Rev. 157, 160, 
173 (2010) ("[Florida] [c]ase law is unequivocal that MSAs 
are to be interpreted and enforced like other contracts."  
(citations omitted); also arguing that this conflicts with a 
trial court's obligation to ensure the best interests of the 
child and advocating that "principles of pure contract law 
cannot apply to the enforcement of an MSA that infringes upon 
a child's guaranteed right to support."). 
 Lauren M. Ilvento, The Application of Kinney System, Inc. v. 
Continental Ins. Co. to Modification of Child Custody 
Proceedings, 83-May Fla. B.J. 41, 43 (2009) ("In the context 
of family law, marital settlement agreements and mediated 
agreements are contracts and are to be interpreted pursuant 
to the provisions of contract law."  (emphasis added; 
citations omitted)). 
 Sol Lovas, When is a Family Not a Family?  Inheritance and 
the Taxation of Inheritance Within the Non-Traditional 
Family, 24 Idaho L. Rev. 353, 366 (1988) ("Separation 
No.  2018AP712-FT.rgb 
 
14 
 
agreements are, of course, subject to the same attacks as all 
other contracts, such as fraud, duress, and lack of 
consideration.  Marital settlement agreements may also be set 
aside if they are grossly inequitable or unfair, and they can 
be attacked for lack of reasonable and fair disclosure prior 
to execution."  (internal footnotes omitted). 
 Renee A. Rubino, Marital Settlement Agreements – The Key to 
Life After Divorce, 279-Dec N.J. Law 46, 46 (2012) ("To be 
clear, an MSA is an enforceable contract like any other 
contract.  Although principles of equity are applied to ensure 
the MSA is fair and just, contract principles are utilized to 
ascertain the MSA's meaning and the intent of the parties."  
(citations omitted)). 
 Reid T. Sherard, Family Court Approval of a Marital Settlement 
Agreement Over One Party's Objection, 26-Jan S.C. Law. 44 
(2015) ("The term 'marital settlement agreement' is a term of 
art . . . such agreements are 'viewed as contracts' between 
the parties[.]" (quoted source omitted)). 
¶51 Dictionaries as well as other sources also describe MSAs 
as contracts: 
 
Marital Settlement Agreement, Black's Law Dictionary 
(11th ed. 2019) ("See Divorce Agreement.")  Divorce 
Agreement, Black's Law Dictionary (11th ed. 2019) ("A 
contractual agreement that sets out divorcing spouses' rights 
and responsibilities regarding property, alimony, custody, 
visitation, and child support.  The divorce agreement usu. 
becomes incorporated by court order as a part of the divorce 
No.  2018AP712-FT.rgb 
 
15 
 
decree and thus is enforceable by contempt, among other 
remedies. – Also termed agreement incident to divorce; 
marital 
settlement 
agreement; 
separation 
agreement."  
(emphasis added)). 
 J. Robert J. Steigmann & Lori A. Nicholson, Illinois Evidence 
Manual § 12.6 (4th ed. 2019) ("Interpreting a marital 
settlement agreement is a matter of contract construction."). 
 17 Robert S. Hunter, Illinois Practice Series: Estate 
Planning & Administration § 27.5 (4th ed. 2019) ("The 
provisions 
of 
marital 
settlement 
agreements 
and 
of 
dissolution judgments which incorporate such agreements are 
interpreted under the same rules governing the construction 
of contracts."). 
 41 C.J.S. Husband and Wife § 95 (2020) ("A marital settlement 
agreement is a contract, which, when entered into before the 
dissolution of the marriage, is binding upon the parties."  
(internal footnotes omitted).). 
¶52 This substantial body of law confirms the essential 
nature of MSAs:  an agreement negotiated between two parties, with 
lawful consideration exchanged, constitutes a binding contract.  
See Contract Black's Law Dictionary (11th ed. 2019) (defining 
"contract" as "An agreement between two or more parties creating 
obligations that are enforceable or otherwise recognizable at law 
.").  A circuit court's review, approval and 
incorporation of the parties' agreement into the divorce judgment 
does not change the nature of the agreement.  Nor should it mean 
that a court can alter the terms of the agreement unilaterally, 
No.  2018AP712-FT.rgb 
 
16 
 
years after its execution, based merely on its incorporation into 
a divorce judgment. 
¶53 The question in this case is not whether a divorce 
judgment strips an MSA of its contractual nature or even whether 
a divorce judgment should be interpreted as "a contract."  The 
parties never presented or argued that question because that issue 
was not in dispute.  Under black letter law, an MSA is a contract 
and its incorporation into a divorce judgment does not change that.  
Nor does incorporation into the divorce judgment mean that one of 
the parties can ask a court decades later to replace the legal 
remedy the parties chose at the time of the divorce with an 
equitable one.  Courts do not create contracts, parties do; the 
courts' duty is to enforce them.  See In re F.T.R., 2013 WI 66, 
¶57, 349 Wis. 2d 84, 833 N.W.2d 634 ("The elements of a contract 
are offer, acceptance, and consideration."  (citations omitted)); 
Restatement (Second) of Contracts § 1 (1981) ("A contract is a 
promise or set of promises . . . ."); 1 Richard A. Lord, Williston 
on Contracts § 1:1 (4th ed. 1990) ("[Contract law] is intended to 
enforce the expectancy interests created by the parties' 
promises[.]"). 
¶54 The Pulkkilas expressly identified and preserved their 
MSA as a contract.  In the very first paragraph of the MSA, the 
parties "agree that the terms and provisions of the agreement may 
be incorporated by the court in the pending divorce action between 
the parties in the conclusions of law and judgment to be entered 
therein; however, this agreement shall independently survive any 
such judgment[.]"  Section XVI of the MSA reiterates the 
No.  2018AP712-FT.rgb 
 
17 
 
independent, contractual nature of the Pulkkilas' agreement:  
"this agreement shall survive any subsequent judgment of divorce 
and shall have independent legal significance.  This agreement is 
a legally binding contract[.]"  Instead of respecting the parties' 
contract and applying the Pulkkilas' chosen remedy, the majority 
sets aside the parties' negotiated contractual provisions in favor 
of reaching a different result because the lien remedy does not 
seem "fair."  However, "[a] provision that seems to the court 
unjust or unfortunate (creating the so-called casus male inclusus) 
must nonetheless be given effect."  Antonin Scalia & Bryan Garner, 
Reading Law:  The Interpretation of Legal Texts 174 (2012).  Even 
if the Pulkkilas' bargained-for remedy was not exclusive, a 
constructive trust is not an available alternative.  "It is well 
established that . . . 'the mere failure to perform an agreement 
or to carry out a promise cannot in itself give rise to 
a constructive trust.'"  In re Estate of Demos, 50 Wis. 2d 262, 
269, 184 N.W.2d 117 (1971) (quoted source omitted). 
II 
A. MSAs are contracts. 
¶55  The parties in this case never disputed that MSAs are 
contracts under the law.  Joan Pulkkila referred to the MSA as a 
"contract" in her brief:  "Lynnea fails to acknowledge that MSAs, 
unlike other contracts . . . " and "[t]hus, the fact that a remedy 
or any other provision in an MSA may have been bargained for as 
part 
of 
a 
contractual 
agreement 
between 
parties . . . ."  
(Emphasis added.)  Indeed, Joan admitted to the circuit court that 
"this is a contractual situation."  Similarly, the court of appeals 
No.  2018AP712-FT.rgb 
 
18 
 
based its holding on the MSA being a contract.  Pulkkila v. 
Pulkkila, No. 2018AP712-FT, unpublished slip op., ¶6 (Wis. Ct. 
App. Feb. 27, 2019) ("Importantly, the law of constructive trusts 
does not require a finding that the contractual language is 
ambiguous."  (emphasis added)). 
¶56 Although an MSA is subject to approval by the circuit 
court in order to prevent contracts violating public policy, once 
a court approves the MSA, those concerns disappear.  The Pulkkilas' 
MSA did not violate public policy, the circuit court approved it, 
and the law deemed it a contract.  See ¶¶48-52, supra.  This court 
should have applied the law, respected the parties' bargain, and 
honored the contractual remedy the parties chose instead of 
offering an extra-contractual remedy grounded in equity and 
fairness.2 
¶57 Recognizing that In re Estate of Boyd ("A stipulation in 
a divorce action is in the nature of a contract.")3 could be read 
as inconsistent with Miner ("The [alimony] award was not 
contractual, but by adjudication and subject to modification"),4 
this court reconciled the two opinions.  In Vaccaro v. Vaccaro, 
the court held not all stipulations in divorce proceedings are 
                                                 
2 The circuit court appropriately recognized that it is not 
the circuit court's job "to go back and fix the parties' agreement 
to make it fair now for the children.  It's not fair they're not 
getting as much money.  They lost their father.  It is a rotten 
deal for them.  However, this Court has to follow the law on it." 
3 In re Boyd's Estate, 18 Wis. 2d 379, 381, 118 N.W.2d 705 
(1963). 
4 Miner v. Miner, 10 Wis. 2d 438, 442-44, 103 N.W.2d 4 (1960), 
abrogated on other grounds by Rohde-Giovanni v. Baumgart, 2004 WI 
27, 269 Wis. 2d 598, 676 N.W.2d 452. 
No.  2018AP712-FT.rgb 
 
19 
 
contracts, but that "contractual obligations arise only in 
situations where the court expressly refers to and approves a 
formal agreement between the parties, and not where, as [in 
Vaccaro], the court merely adopts and to some extent modifies the 
parties' joint recommendations as to alimony, support or property 
settlement."  67 Wis. 2d 477, 486, 227 N.W.2d 62 (1975) (emphasis 
added); see also Kelvin H. Dickinson, Divorce and Life Insurance: 
Post Mortem Remedies for Breach of a Duty to Maintain a Policy for 
a Designated Beneficiary, 61 Mo. L. Rev. 533, 551-52 (1996) 
(conceding 
that 
"many 
divorce 
agreements 
are 
essentially 
contracts, and, thus, governed by standard contract principles" 
while citing to the quote above from Vacarro (emphasis added)). 
¶58 This court's recent opinions discussed the importance of 
the right of divorcing parties to contract through MSAs, and 
applied contract principles to these agreements.  In May v. May, 
the court confronted a child support stipulation in the parties' 
MSA, which the divorce judgment incorporated.  2012 WI 35, ¶4, 339 
Wis. 2d 626, 813 N.W.2d 179.  The court stated, "we are sensitive 
to the importance and prevalence of stipulations in helping 
families going through difficult and litigious divorces and 
curbing disagreements [between] the parties.  The ability to 
contract is fundamental to our legal system and may aid parties in 
settling their divorces more amicably."  Id., ¶18 (emphasis added) 
(quoting Frisch v. Henrichs, 2007 WI 102, ¶75, 304 Wis. 2d 1, 736 
N.W.2d 85).  In this case, the majority fails to honor divorcing 
parties' fundamental freedom to contract, depriving them (and 
No.  2018AP712-FT.rgb 
 
20 
 
their children) of any finality in their financial and relational 
matters. 
¶59 In a case preceding May, this court applied contract 
principles to "interpret[]" an MSA incorporated into a divorce 
judgment.  See Topolski v. Topolski, 2011 WI 59, ¶1, 335 
Wis. 2d 327, 802 N.W.2d 482.  The Topolski court stated it was 
putting the parties in the "same position they would have been in" 
but for the occurrence of an event, and giving the parties "exactly 
what they bargained for in the Marital Settlement Agreement[.]"  
Id., ¶7.  These are settled pillars of contract law.  See Daanen 
& Janssen, Inc. v. Cedarapids, Inc., 216 Wis. 2d 395, 404, 573 
N.W.2d 842 (1998) ("The law of contracts is designed . . . to 
protect the expectancy interests of parties to private bargained-
for agreements.  Contract law, therefore, seeks to . . . ensur[e] 
that each party receives the benefit of their bargain."  (citations 
omitted)).  The Topolski court, citing to contract cases, adopted 
as the standard of review "well-established" "principles that 
govern [the] interpretation of written documents[.]"  Topolski, 
335 Wis. 2d 327, ¶¶28-32 n.10.  The court proceeded to analyze the 
text of the MSA, giving it "its plain and ordinary meaning" to 
ascertain the parties' intent.  Id., ¶49. 
¶60 I would apply longstanding, controlling authority and 
treat the MSA between Joan and James Pulkkila as the contract it 
is.  The analysis then turns to whether there is any legal basis 
to set aside the contract as a whole or its life insurance 
provision in particular.  There is none. 
 
No.  2018AP712-FT.rgb 
 
21 
 
B. The divorce judgment did not nullify or alter the MSA. 
¶61 There are multiple reasons courts nullify or modify 
contracts——including rescission, mistake, fraud, duress, etc.  See 
Williston §§ 18, 68-77.  None of these were raised by either party 
and none apply in the Pulkkilas' case.  At the time the terms of 
the Pulkkilas' divorce were finalized, the circuit court approved 
and incorporated the MSA into the divorce judgment, without 
disapproving or amending the provisions in Section V of the MSA,5 
which required the parties to maintain life insurance with their 
minor children as beneficiaries and specified the remedy in case 
of a breach.  Because the life insurance provision was not 
nullified or amended by the divorce judgment's incorporation of 
the agreement, the divorce judgment did not change the contractual 
nature of the MSA.  See, e.g., Topolski, 355 Wis. 2d 327, ¶¶28-
49; Dickau, 344 Wis. 2d 308, ¶14 ("We apply the rules of contract 
construction to a divorce judgment[.]" (citation omitted)). 
C. The remedy provision of the MSA controls. 
¶62 "If there is one thing which more than another public 
policy requires it is that [individuals] of full age and competent 
understanding shall have the utmost liberty of contracting, and 
that their contracts, when entered into freely and voluntarily, 
shall be held sacred, and shall be enforced by courts of justice."  
Midwest Neurosciences Assocs., LLC v. Great Lakes Neurosurgical 
                                                 
5 The circuit court did make several amendments to the MSA 
following the trial, but these related to payment of utilities, 
anger management counseling, child support from gross monthly 
income, payment of debt, pension benefit award, cash value of 
insurance policies, and a holiday schedule. 
No.  2018AP712-FT.rgb 
 
22 
 
Assocs., LLC, 2018 WI 112, ¶39, 384 Wis. 2d 669, 920 N.W.2d 767 
(quoting Merten v. Nathan, 108 Wis. 2d 205, 212 n.5, 321 N.W.2d 173 
(1982)).  Wisconsin law is replete with affirmations of the 
parties' freedom to contract, including the freedom to specify 
determinate remedies.  See, e.g., Ash Park, LLC v. Alexander & 
Bishop Ltd., 2010 WI 44, ¶37, 324 Wis. 2d 703, 783 N.W.2d 294 
("When a contract specifies remedies available for breach of 
contract, the intention of the parties generally governs."). 
¶63 Because the MSA is a contract, prevailing principles of 
contract interpretation apply.  "[W]e interpret the plain language 
of a contract 'consistent with what a reasonable person would 
understand the words to mean under the circumstances."  Marx v. 
Morris, 2019 WI 34, ¶63, 386 Wis. 2d 122, 925 N.W.2d 112 (quoting 
Maryland Arms Ltd. P'ship v. Connell, 2010 WI 64, ¶22, 326 
Wis. 2d 300, 786 N.W.2d 15.  "Where the terms of a contract are 
clear and unambiguous, we construe the contract according to its 
literal terms."  Gorton v. Hostak, Henzl & Bichler, S.C., 217 
Wis. 2d 493, 506, 577 N.W.2d 617 (1998) (citation omitted).  
"[U]nambiguous 
contract 
language 
controls 
contract 
interpretation."  Kernz v. J.L. French Corp., 2003 WI App 140, ¶9, 
266 Wis. 2d 124, 667 N.W.2d 751. 
¶64 Section V of the Pulkkila MSA contains the two provisions 
material to this appeal:  
A.  Both parties shall maintain in full force and 
pay the premiums on all life insurance presently in 
existence on their lives or obtain comparable insurance 
coverage, with the parties' minor children names as sole 
and irrevocable primary beneficiaries until the youngest 
minor child reaches the age of majority, or until the 
child has reached the age of 19 . . .  
No.  2018AP712-FT.rgb 
 
23 
 
. . . . 
D.  If either party fails for any reason to maintain 
any of the insurance required under this article, there 
shall be a valid and provable lien against his or her 
estate in favor of the specified beneficiary to the 
extent of the difference between the insurance required 
and the actual death benefits received.  
(Emphasis added.)  Section V, article A of the MSA unambiguously 
required both Joan and James Pulkkila to maintain life insurance 
with the children as beneficiaries, until the children become a 
certain age.  The parties do not dispute the obligatory requirement 
of this provision or suggest an alternate meaning. 
¶65  The parties' dispute centers on the remedy for failing 
to adhere to the life insurance obligation set forth in section V, 
article A.  The majority holds the remedy for breach of that 
obligation——a lien against the estate——is not the exclusive 
remedy.  See Majority op. ¶27.  The majority cites no language in 
the MSA or divorce judgment, nor any amendment to either, changing 
the specific remedy the Pulkkilas chose for breach of the life 
insurance provision, but instead decides the lack of limiting 
language indicates that the specified lien is not the "only remedy 
for such a breach" and the mandatory "shall" in this provision 
does not mean the lien remedy is exclusive.  Majority op., ¶¶23-
24.  I disagree. 
¶66 MSA section V, article D states that the remedy for 
breach of the obligation set forth in article A to maintain 
insurance with the children as primary beneficiaries "shall be 
a . . . lien" against the estate of the party who violates article 
A.  The remedy applies if a party breaches this obligation "for 
any reason."  The word "shall" in written legal texts generally 
No.  2018AP712-FT.rgb 
 
24 
 
imposes a mandatory obligation, rather than a discretionary one.  
See Village of Elm Grove v. Brefka, 2013 WI 54, ¶23, 348 
Wis. 2d 282, 832 N.W.2d 121 (discussing that we "ordinarily 
presume[]" that "shall" is mandatory); Scalia &  Garner, Reading 
Law 
112 
("Mandatory 
words 
impose 
a 
duty . . . shall 
is 
mandatory.").  Reading "shall" as imposing a mandatory remedy 
accords with the agreement of the parties to maintain life 
insurance policies naming their children as primary beneficiaries.  
Nothing in the text of the MSA or the divorce judgment suggests 
the Pulkkilas agreed to (or the circuit court ordered) anything 
different. 
¶67 The only remedy listed in article D specifically, the 
MSA as a whole, or the divorce judgment, for breach of the 
obligation to maintain life insurance with the minor children as 
sole beneficiaries is a "lien against [the violator's] estate in 
favor of the specified beneficiary to the extent of the difference 
between the insurance required and the actual death benefits 
received."  Under longstanding Wisconsin law, the express mention 
of one option in a legal instrument forecloses the availability of 
other options.  See Goebel v. First Fed. Sav. & Loan Ass'n of 
Racine, 83 Wis. 2d 668, 673, 266 N.W.2d 352 (1978); Horizon Bank, 
Nat'l Ass'n v. Marshalls Point Retreat LLC, 2018 WI 19, ¶95, 380 
Wis. 2d 60, 
908 
N.W.2d 797 
(Rebecca 
Grassl 
Bradley, 
J., 
dissenting) ("Under [the] principle [of expressio unius est 
exclusio alterius], a specific mention in a contract of one or 
more matters is considered to exclude other matters of the same 
nature or class not expressly mentioned[.]"  (quoting Goebel, 83 
No.  2018AP712-FT.rgb 
 
25 
 
Wis. 2d at 673).  Under this canon of construction, the expression 
of the lien remedy in article D of the MSA excludes all other 
remedies for failing to maintain life insurance with the children 
as sole beneficiaries——including a constructive trust. 
¶68 
The MSA's life insurance provisions are plain and 
unambiguous, and therefore govern the disposition in this case. 
The lien remedy the parties elected in Section V of the MSA is 
both mandatory and exclusive upon either party's failure "for any 
reason" to maintain life insurance naming the minor children as 
sole beneficiaries.  Equitable relief, such as a constructive 
trust, is not available.  A constructive trust was "created by law 
to prevent unjust enrichment[.]"  Wilharms v. Wilharms, 93 Wis. 2d 
671, 678-79, 287 N.W.2d 779 (1980).  However, "[t]he doctrine of 
unjust enrichment does not apply where the parties have entered 
into a contract."  Greenlee v. Rainbow Auction/Realty Co., Inc., 
202 Wis. 2d 653, 671, 553 N.W.2d 257 (Ct. App. 1996) (citation 
omitted); In re Demos' Estate, 50 Wis. 2d 262, 269, 184 N.W.2d 117 
(1971) ("the mere failure to perform an agreement or to carry out 
a promise cannot in itself give rise to a constructive trust");  
Guaranteed Inv. Co. v. St. Croix Consol. Copper, 156 Wis. 173, 
175, 145 N.W. 662 (1914)(holding that a claim in equity "cannot be 
sustained" where there is an "adequate remedy at law"). 
¶69 
Finally, the majority does not grapple with its failure 
to give effect to the parties' chosen remedy language, depriving 
it of any operative effect whatsoever and leaving it mere 
surplusage.  Specifying a mandatory lien remedy is completely 
No.  2018AP712-FT.rgb 
 
26 
 
pointless if a court is free to impose a different remedy.6  By 
rewriting the parties' MSA and allowing a remedy other than the 
one the MSA provides, the majority violates the canon against 
surplusage.  See Ash Park, LLC v. Alexander & Bishop, Ltd., 2015 
WI 65, ¶37, 363 Wis. 2d 699, 866 N.W.2d 679; Heritage Mut. Ins. 
Co. v. Truck Insurance-Exchange, 184 Wis. 2d 247, 258, 516 
N.W.2d 8 (Ct. App. 1994) (recognizing that the surplusage rule 
applies when interpreting contracts) ("[T]he general rule of 
construction is that an interpretation of an agreement which gives 
reasonable meaning to all provisions is preferable to one which 
leaves part of the language useless or inexplicable or creates 
surplusage.").  "If possible . . . every provision is to be given 
effect (verba cum effectu sunt accipienda).  None should be 
ignored.  None should needlessly be given an interpretation that 
causes it . . . to have no consequence."  Scalia & Garner, Reading 
Law at 174 (footnote omitted).  The majority's treatment of the 
life insurance provision needlessly writes the mandatory remedy 
chosen by the parties out of the agreement altogether, violating 
the surplusage canon, which "holds that it is no more the court's 
function to revise by subtraction than by addition."  Id.  The 
most 
frequent 
circumstance 
this 
canon 
prevents 
is 
"an 
interpretation that renders [a provision] pointless."  Id. at 176.  
The canon applies to contracts like MSAs:  "This court must be 
                                                 
6 Dissenting from the court of appeals decision, then-Judge 
Brian Hagedorn recognized that "the MSA's mandatory lien language 
does not make much sense if other remedies could be pursued instead 
of a lien."  Pulkkila v. Pulkkila, No. 2018AP712-FT, unpublished 
slip op., ¶15 (Wis. Ct. App. Feb. 27, 2019) (Hagedorn, J., 
dissenting). 
No.  2018AP712-FT.rgb 
 
27 
 
guided by the well accepted and basic principle that an 
interpretation that gives a reasonable meaning to all parts of the 
contract will be preferred to one that leaves portions of the 
contract meaningless."  Id., (quoting Fortec Constructors v. 
United States, 760 F.2d 1288, 1292 (Fed. Cir. 1985)).  In 
construing contracts, "courts must avoid a construction which 
renders portions of a contract meaningless, inexplicable or mere 
surplusage."  Goebel, 83 Wis. 2d at 680. 
¶70 Nothing the majority proffers can justify contravening 
the parties' contract.  Modifying the parties' chosen remedy also 
conflicts with Wisconsin statutory law.  Life insurance is an asset 
under Wis. Stat. § 767.217(1) and is subject to property division 
that is unmodifiable post-judgment, under § 767.59(1c)(b):  "A 
court may not revise or modify . . . a judgment or order with 
respect to final division of property."  Because the life insurance 
provision addresses a marital property asset, the circuit court is 
statutorily prohibited from modifying its remedy clause by 
imposing a constructive trust.  See also Winkler v. Winkler, 2005 
WI App 100, ¶15, 282 Wis. 2d 746, 699 N.W.2d 652 (citing Krieman 
v. Goldberg, 214 Wis. 2d 163, 173, 571 N.W.2d 425 (Ct. App. 1997)) 
("[A] final division of property is fixed for all time and is not 
subject to modification.").  The life insurance provision is not 
modifiable and any "unfair" terms could have and should have been 
rejected or amended before the divorce judgment was entered. 
III 
¶71 The MSA is a contract and the divorce judgment did 
nothing to alter its contractual nature.  The court approved it at 
No.  2018AP712-FT.rgb 
 
28 
 
the time it entered the judgment of divorce and this court should 
enforce it in accordance with its terms.  The Pulkkilas elected a 
particular legal remedy for James Pulkkila's breach and expressed 
it unequivocally in their MSA; this court should apply it.  I would 
reverse the court of appeals decision and hold the exclusive remedy 
is a lien against James' estate, consistent with the unambiguous 
words of the parties' MSA.  I would reinstate the decision of the 
circuit court.  Because the majority disregards controlling cases 
and statutes in order to confer unprecedented powers on the 
judiciary to rewrite marital settlement agreements, thereby 
infringing the individual freedom to contract, I respectfully 
dissent. 
 
No.  2018AP712-FT.rgb 
 
 
 
1