Court Opinion

ID: 9734921
Source: CourtListenerOpinion
Date Created: 2023-08-26 17:51:46.501142+00
Date Added: 2024-06-11T18:26:52.362676
License: Public Domain

JON E WILCOX, J.
¶ 78. (dissenting). I disagree with the majority's conclusion that "under Wis. Stat. § 846.30 [2000-011] equitable title remains with a land contract vendee until a circuit court enters a final order, following the redemption period for strict foreclosure, confirming the land contract vendee's nonredemption." Majority op., ¶ 4. I would hold that under § 846.30, equitable title on a land contract passes as a matter of law following the vendee's nonpayment at the end of the redemption period, as established by the land contract *425or a previously issued court order for strict foreclosure. While the circuit court is required under the statute to enter a final order confirming the vendee's nonredemption, such order is not required in order for title to pass.
¶ 79. This position is in accordance with the common law governing land contracts, which, contrary to the majority's assertion, majority op., ¶ 46, was quite clear. The common law governing the passage of title for land contracts was shaped primarily by two cases: St. Joseph's Hospital v. Maternity Hospital, 224 Wis. 422, 273 N.W.791 (1937), and Exchange Corporation of Wisconsin v. Kuntz, 56 Wis. 2d 555, 202 N.W.2d 393 (1972).
¶ 80. The issue in St. Joseph's Hospital was whether a circuit court had power in a strict foreclosure action to extend the period of redemption before that period expired. St. Joseph's Hosp., 224 Wis. at 424-425. In addressing this issue, the court stated:
A judgment of strict foreclosure of a land contract does not produce absolute finality. In such judgments, a subsequent order barring the defendant's interest and claims for want of redemption is essential in order to declare and quiet title in the plaintiff, and a writ for removing the defendant from the premises is contemplated in case it becomes necessary. Proceedings at the foot of the judgment are a matter of course in these cases and the litigation is not at an end until they are taken. It would seem, a priori, that until the final order contemplated, an order making the judgment absolute, has been entered, anything discretionary might properly be done by the court that has material bearing upon the equities of the parties respecting the order finally ending the litigation between them. Independent of a statute providing for extension in strict foreclosure cases of the period of redemption from judgments not become absolute, a court as a court of *426equity would unquestionably have power to extend in effect the period of redemption provided for in its judgment if such extension were required by equity and good conscience.
Id. at 430.
¶ 81. This language from St. Joseph's Hospital can be read in one of two ways. First, it could be interpreted as holding that equitable title in a land contract does not pass at the end of the redemption period in a strict foreclosure action, but requires a final order confirming that title had passed because the court retains the power to extend the redemption period until a final order is entered confirming a judgment of strict foreclosure. However, such a broad ruling would seem unnecessary in light of the facts in St. Joseph's Hospital because there, the challenged circuit court order was an order extending the period of redemption on a land contract before the original period of redemption had expired. Id. at 424. Thus, St. Joseph's Hospital could be read as simply providing that in an action for strict foreclosure, a court retains the equitable power to extend the period of redemption before a final order is issued, assuming the redemption period has not yet run.
¶ 82. Whatever confusion existed as to the scope of the holding in St. Joseph's Hospital was put to rest in Exchange Corporation, which explained and clarified the meaning of the above passage from St. Joseph's Hospital. In Exchange Corporation, 56 Wis. 2d at 562, when discussing strict foreclosure judgments, this court held:
A strict foreclosure judgment is of such a nature that the court must be considered as having the power to control the judgment even beyond a term of court to the extent the period of redemption may be extended on *427equitable grounds if an application for extension is made prior to the expiration of the period; the judgment did not reserve this power for it becomes final or absolute only upon the expiration of the period of redemption. Such a judgment may be considered as an interlocutory judgment which automatically becomes final upon the expiration of the period of redemption without any further motion or decree making it absolute. If the record is to reflect the fact the vendee did not redeem, an order may be entered finding the vendee did not meet the conditions; sometimes an affidavit of such fact is filed. But if the order is used, it would normally not confirm the title but merely reaffirm the legal title in the vendor. It is possible for a court to reserve power to extend the period of redemption even after the original period of redemption has expired, in which case it would have power to extend time even without the vendee's application prior to expiration of the original period. If the court does reserve this power, a subsequent order would seem necessary to finally terminate any possible rights in the vendee; but this would be an unusual case.
Id. at 561-62 (emphasis added). In so holding the court expressly stated: "Broader dicta in the St. Joseph's Hospital Case to the effect the court of equity has inherent jurisdiction after the expiration of the period of redemption without reserving such power is disapproved." Id. at 562 (emphasis added). Thus, Exchange Corporation explained that a narrow reading of St. Joseph's Hospital was correct and it disapproved any dicta suggesting a broader holding that title in a land contract passes only upon the circuit court entering a final order indicating that title has passed.
¶ 83. The following rules governing the passage of title on land contracts in strict foreclosure actions are apparent from Exchange Corporation. First, "the period of redemption may be extended on equitable grounds if an application for extension is made prior to the expira*428tion of the period[.]" Id. at 561. Second, the period of redemption may be extended after the original redemption period has expired only if the court expressly "reserve [d] power to extend the period of redemption even after the original period of redemption has expired." Id. at 561-62. Third, if the original judgment of strict foreclosure did not expressly reserve the power to extend the redemption period after the redemption period had expired and no application was made to extend the period of redemption before it expired, the judgment "automatically becomes final upon the expiration of the period of redemption without any further motion or decree making it absolute." Id. at 561. In this third scenario, although "an order may be entered finding the vendee did not meet the conditions [,] ... [the order] would normally not confirm the title but merely reaffirm the legal title in the vendor." Id. Thus, such an order merely effects record title; it is not a prerequisite for the title to pass in the first instance. Title passes as a matter of law at the end of the redemption period. The only time a final order is required for title to pass is where the judgment of strict foreclosure reserved the right of the circuit court to extend the period of redemption after the redemption period has expired.
¶ 84. With these common-law rules in mind, I now turn and examine § 846.30, which provides:
If a court finds that the purchaser under a land contract is obligated to make certain payments under that land contract, that the purchaser has failed to make the required payments and that the vendor is entitled to a judgment of strict foreclosure, the court shall set a redemption period of at least 7 working days from the date of the judgment hearing or, if there is no hearing, from the date of the entry of the judgment order. No judgment of strict foreclosure is final until the court enters an order after the expiration of the redemp*429tion period confirming that no redemption has occurred and making the judgment of strict foreclosure absolute.
Wis. Stat. § 846.30.
¶ 85. I am not persuaded by the majority's discussion of legislative history that the last sentence of § 846.30 was intended to overrule this court's decision in Exchange Corporation and treat land contracts similar to mortgages. Majority op., ¶¶ 50-53, 57. Section § 846.30 was enacted as 1995 Wis. Act 250. The legislative history of the Act indicates that its purpose was twofold. First, the Act was intended to require a mandatory minimum redemption period in an action for strict foreclosure, as existing law did not mandate that a redemption period exist and an unpublished court of appeals decision had recently held that there was no right to a redemption period. Second, the Act was intended to codify "existing case law requirements" in relation to the need for a final order in a strict foreclosure action.
¶ 86. At the time 1995 Wis. Act 250 was enacted, the law governing the passage of title and need for a final order was that as explained by Exchange Corporation, which clarified the holding of St. Joseph's Hospital. Nothing in the legislative history of 1995 Wis. Act 250 evinces an intent to overrule Exchange Corporation. Quite the opposite, the goal was to codify "existing case law requirements." While the intent of the legislation was to require a final order, it is Exchange Corporation that sets forth the effect of such an order.
¶ 87. As such, I would interpret the last sentence of § 846.30 in accordance with the rules set forth by this court in Exchange Corporation and hold that equitable title on a land contract passes as a matter of law following the vendee's nonpayment at the end of the redemption period for strict foreclosure. A final order *430merely reaffirms that title has indeed passed; however, in doing so, it provides clarity and certainty to third parties about legal title. In addition to being consistent with our common law, this interpretation avoids the inequitable result that a land contract vendee who has failed to pay at the end of the redemption period will still hold title to the land until the circuit court enters a final order. Majority op., ¶ 57.
¶ 88. Finally, even if the last sentence of § 846.30 is viewed as overturning the portion of Exchange Corporation that holds that equitable title on a land contract passes as a matter of law following the vendee's nonpayment at the end of the redemption period for strict foreclosure, § 846.30 does not affect the remainder of the opinion. That is, even if a final order is required before title may pass, under Exchange Corporation, the circuit court does not have the power to extend the period of redemption once the period of redemption has expired, unless the judgment of strict foreclosure reserved such a power. Exch. Corp., 56 Wis. 2d at 561-62. As the text of § 846.30 does not state differently, this portion of Exchange Corporation remains good law. As such, if the period of redemption has expired and the vendee has not made payment, the circuit court may not subsequently extend the period of redemption unless its judgment of strict foreclosure reserved such a power.
¶ 89. For the foregoing reasons, I respectfully dissent.
¶ 90. I am authorized to state that Justice PATIENCE DRAKE ROGGENSACK joins this dissent.

 All references to the Wisconsin Statutes are to the 2001-02 version unless otherwise indicated.