Opinion ID: 1703027
Heading Depth: 3
Heading Rank: 1

Heading: Unambiguous terms

Text: ¶ 33 We note that neither Solowicz nor the Developer dispute that the terms of the Community Declaration must be unambiguous; however, they do dispute whether the terms are unambiguous. ¶ 34 Ordinary contract rules apply to interpreting the terms of contracts such as the Community Declaration. See Siler v. Read Inv. Co., 273 Wis. 255, 261, 77 N.W.2d 504 (1956). Wisconsin public policy favors freedom of contract. AKG Real Estate, LLC v. Kosterman, 2006 WI 106, ¶ 34, 296 Wis.2d 1, 717 N.W.2d 835. Freedom of contract is based on the idea that individuals should have the power to govern their own affairs without interference. Id. Our goal in interpreting contracts that were freely entered into is to determine and give effect to the parties' intention. Wis. Label Corp. v. Northbrook Prop. & Cas. Ins. Co., 2000 WI 26, ¶ 23, 233 Wis.2d 314, 607 N.W.2d 276 (citing Gorton v. Hostak, Henzl & Bichler, S.C., 217 Wis.2d 493, 506, 577 N.W.2d 617 (1998)). Wisconsin public policy also favors the free and unrestricted use of property. Dodge v. Carauna, 127 Wis.2d 62, 65, 377 N.W.2d 208 (Ct.App.1985) (citing Crowley v. Knapp, 94 Wis.2d 421, 434, 288 N.W.2d 815 (1980)). ¶ 35 In order to accommodate the principle favoring free and unrestricted use of property and the principle favoring individuals' right to freely contract in ordering their own affairs, we generally have said that documents such as the Community Declaration must be expressed in unambiguous language to be enforceable contracts. Pertzsch v. Upper Oconomowoc Lake Ass'n, 2001 WI App 232, ¶ 8, 248 Wis.2d 219, 635 N.W.2d 829 (citing Dodge, 127 Wis.2d at 65, 377 N.W.2d 208); see also Crowley, 94 Wis.2d at 435, 288 N.W.2d 815 (to be enforced, restrictions must be expressed in clear, unambiguous, and peremptory terms). We apply the standard set forth in Zinda, which includes ascertainment of the purpose of the contract, to determine whether the Community Declaration is expressed in unambiguous terms. See Zinda, 191 Wis.2d at 167, 528 N.W.2d 55. ¶ 36 Language is ambiguous if it is susceptible to more than one reasonable interpretation. Id. at 165-66, 528 N.W.2d 55. However, if the intent of the contract can be certainly ascertained from the document itself, it will be enforced. Id. at 166, 528 N.W.2d 55. By intent we do not mean the subjective intent of the drafter, but the scope and purpose of the [document] as manifest by the language used. Id. Furthermore, a document need not expressly prohibit the specific activity in question; when the purpose is ascertainable, the document should be construed to give effect to that purpose. Bubolz, 159 Wis.2d at 294, 464 N.W.2d 67. Applying these principles of law to the Community Declaration, we determine that its terms are unambiguous in light of its purpose. ¶ 37 As previously stated, Article IX of the Community Declaration reserved to the Declarant control over Geneva National until conveyance by Declarant of eighty-five percent (85%) of the maximum number of residential units. Solowicz contends that the term conveyance is ambiguous because it was redefined two times, [23] which demonstrates that the term is subject to more than one reasonable interpretation. Solowicz further contends that because GN Partners, the original developer, conveyed certain undeveloped land in Geneva National to its lenders, who in turn transferred most of that land to the current Developer, the Declarant's control is terminated because it conveyed more than 85 percent of the units. We are unpersuaded. ¶ 38 We give effect to the purpose of the Community Declaration as manifest by the language used. See Zinda, 191 Wis.2d at 166, 528 N.W.2d 55. We agree with the circuit court's characterization of the Community Declaration's purpose. It is unambiguously an attempt to position control of Geneva National with the Declarant until a significant number of the residential units are sold to allow the Declarant to promote the orderly development of the property according to the master plan. Accepting Solowicz's contention would contravene this purpose by eliminating Declarant control when only 52 percent of the residential units have been conveyed to individual unit owners; conveying land to a third-party lender does not eliminate the need for Declarant control over the property. The Declarant's two explanations of what constitutes a conveyance did not redefine the term, but instead served to reinforce the Community Declaration's purpose by concluding that a conveyance occurs when the Developer conveys a parcel to an owner or to a third-party developer who has platted the parcel. [24] Accordingly, the terms of the Community Declaration unambiguously maintain the Declarant's control until 85 percent of the residential units are conveyed to individual unit owners or to a third-party developer who has platted the parcels. Conveyance of 85 percent of the residential units to individual unit owners or third-party developers who have platted the parcels has not yet occurred.