Court Opinion

ID: 4525031
Source: CourtListenerOpinion
Date Created: 2020-04-14 14:25:11.265554+00
Date Added: 2024-06-11T12:11:56.663647
License: Public Domain

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                                     (2019 – unpublished)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.
                                                                        FILED
James M. Pulkkila,
                                                                   APR 14, 2020
            Respondent,
                                                                       Sheila T. Reiff
Lynnea Landsee-Pulkkila,                                           Clerk of Supreme Court

            Other Party-Respondent-Petitioner.

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

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).

                                2
                                                       No.   2018AP712-FT

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.

       The Honorable James R. Kieffer presided at the initial
       2

divorce proceedings, while the Honorable Paul Bugenhagen, Jr.,
presided at the proceedings related to the constructive trust issue
now before this court.

                                    3
                                                        No.    2018AP712-FT

     ¶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

                                     4
                                                               No.   2018AP712-FT

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

                                         5
                                                              No.     2018AP712-FT

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.
                                       6
                                                              No.   2018AP712-FT

                                   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
                                   7
                                                             No.   2018AP712-FT

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

                                      8
                                                          No.   2018AP712-FT

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
                                     9
                                                                         No.     2018AP712-FT

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
                                            10
                                                                           No.    2018AP712-FT

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
                                             11
                                                                   No.   2018AP712-FT

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

                                        12
                                                    No.   2018AP712-FT

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).

                                 13
                                                                    No.    2018AP712-FT

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.

      4As 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."

                                           14
                                                      No.   2018AP712-FT.rgb

      ¶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

      1This 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
                                 1
                                                    No.    2018AP712-FT.rgb

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.

                                     2
                                                                  No.   2018AP712-FT.rgb

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).

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   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.").

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     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.").

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   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).

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   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).

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   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)).

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   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

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    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))).

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   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)).

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     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)).

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   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

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      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

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      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,

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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

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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

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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.

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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

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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.

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      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

       The circuit court did make several amendments to the MSA
          5

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.

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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 . . .
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      . . . .

           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
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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

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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

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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

       Dissenting from the court of appeals decision, then-Judge
       6

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).

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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

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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.

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