Court Opinion

ID: 9735020
Source: CourtListenerOpinion
Date Created: 2023-08-26 17:57:30.658522+00
Date Added: 2024-06-11T18:26:54.326452
License: Public Domain

LOUIS B. BUTLER, JR., J.
¶ 59. 0dissenting). At times, issues are complex and therefore are in need of complex resolutions. At times, we tend to see complexity where none exists. This, I conclude, is one of those occasions where the issue and its resolution are simple. Because there was no affirmative vote, approval, or *391consent to transfer the warehouse property owned by New Jersey LLC to a new limited liability company called 2005 New Jersey LLC, as required by the Member's Agreement and Wis. Stat. § 183.0404(1) (2001-02), no legal transfer of the property took place. As such, I would affirm the court of appeals, albeit on different grounds. I therefore respectfully dissent.
¶ 60. I agree with the majority's overall analysis of the overview and history of limited liability companies. Majority op., ¶¶ 14 — 19. The majority correctly notes that the overriding goal of the Wisconsin Limited Liability Company Law (WLLCL) was to create a business entity providing, among other things, simplicity. Majority op., ¶ 19. The drafters of Wis. Stat. ch. 183 emphasized the importance of flexibility and freedom of contract and hoped that the LLC would provide an inexpensive vehicle that did not require legal counsel at every step. Id. See also, Joseph Boucher et al., LLCs and LLPs: A Wisconsin Handbook § 1.11 (rev. ed. 1999).
¶ 61. The meaning of the Member's Agreement signed on January 13, 1999, by Julie Monnier, Paul Gottsacker, and Gregory Gottsacker is at issue here. The relevant portion of the agreement is as follows:
(4) Julie A. Monnier shall own a 50% interest in the capital, profits and losses of Company and shall have 50% of the voting rights of Company.
(5) Paul Gottsacker and Gregory Gottsacker, collectively, shall own a 50% interest in the capital, profits and losses of Company and shall have 50% of the voting rights of Company.
When the terms of a contract are plain and unambiguous, we will construe it as it stands. Borchardt v. Wilk, 156 Wis. 2d 420, 427, 456 N.W.2d 653 (Ct. App. 1990) (iciting Ford Motor Co. v. Lyons, 137 Wis. 2d 397, 460, *392405 N.W.2d 354 (Ct. App. 1987)). Because I see no ambiguity, I would use the terms of the agreement to ascertain its meaning.
¶ 62. Part (4) of the agreement clearly states that Julie Monnier owns a 50 percent interest in the Company, and shall have 50 percent of the voting rights of Company. Part (5) clearly provides that the Gottsacker brothers collectively own a 50 percent interest in the Company and "shall have 50% of the voting rights of Company." (emphasis added). There is no ambiguity in the construction of this agreement. Part (4) defines a separate 50 percent interest and voting right, and part (5) defines a separate 50 percent interest and voting right. Part (5) could have been written to provide each brother with a 25 percent share of the collective interest and voting right, but it was not drafted in that manner. Instead, the interest and the voting right were created as a collective.
¶ 63. The term "collectively" is not defined in the document. Majority op., ¶ 23. Accepting the definition for collectively that the majority adopts which was relied upon by the trial court creates no ambiguity. Id. That definition provided: "formed by collecting; gathered into a whole ... designating or any enterprise in which people work together as a group, especially under a system of collectivism ...." Id. See also Webster's Third New Int'l Dictionary 445 (unabr. 1986) (defining "collectively" as "in a collective sense or manner: in a mass or body: in a collected state: in the aggregate: by collective acts."). I disagree with the conclusion that the definition relied upon, or any definition for that matter, supports Monnier and Paul's position that Paul and Gregory each had an individual 25 percent voting right in the LLC.
*393¶ 64. If a "collective" is formed by collecting, it is the collective that remains, not the individual collected items. If it is gathered into a whole, it is the whole that remains. If it is an enterprise in which people work together as a group, it is the group that remains. I concur with the majority's conclusion that the term "collectively" refers to the sum of the brothers' interests, majority op., ¶ 25, but that does not alter the fact that it is the sum that remains, and not the individual interests. Any other construction effectively rewrites the agreement entered into by these individuals.
¶ 65. Of course we must reject a construction resulting in unfair or unreasonable results, and give a construction that will render the contract a rational business instrument. Majority op., ¶ 24. There is nothing unfair nor unreasonable about construing this agreement as the parties wrote it. Nor is the agreement an irrational business instrument. It was the parties that specified the two separate 50 percent interests in New Jersey LLC. It was the parties that specified the two separate voting blocks. They could have chosen to draft the agreement to take into account each person's individual interest and voting rights, but the parties chose not to do so. If the parties choose to set forth an agreement that requires the brothers to vote together as one interest, this court should not stand in their way. If the drafters of Wis. Stat. ch. 183 emphasized the importance of flexibility and freedom of contract, then we ought to respect the flexibility and freedom of this agreement. In short, the trial court got it right when it concluded that Paul Gottsacker lacked the authority to act without the assent of his brother.
¶ 66. Gregory Gottsacker did not agree to or even know about the transfer of the warehouse engineered by petitioners in this matter. Thus, the collective pro*394vided in part (5) of the agreement never voted, approved, or consented to that transfer, as is required by Wis. Stat. § 183.0404(1). I therefore agree with the trial court that the warehouse should be returned from 2005 New Jersey LLC to New Jersey LLC. Accordingly, I respectfully dissent.