American Indus. Leasing Co. v. Moderow, 88-0025
| Decision Date | 12 October 1988 |
| Docket Number | No. 88-0025,88-0025 |
| Citation | 147 Wis.2d 64,432 N.W.2d 617 |
| Parties | AMERICAN INDUSTRIAL LEASING COMPANY, Plaintiff-Respondent, v. Steven and Lilah MODEROW, Defendants-Appellants. |
| Court | Wisconsin Court of Appeals |
Prieve, Meyer & Nestingen, S.C. by Robert H. Storm and Nancy M. Bonniwell, Milwaukee, for plaintiff-respondent.
Schober & Ulatowski, S.C. by Thomas L. Schober, Green Bay, for defendants-appellants.
Before MOSER, P.J., and SULLIVAN and FINE, JJ.
Appellants Steven and Lilah Moderow (Moderows) appeal from a judgment and order of the trial court finding them in default of their lease with American Industrial Leasing Company (American), and awarding American replevin, money damages, actual costs and attorney's fees. We hold that the trial court was correct in its analysis and application of the law, and therefore we affirm.
On September 23, 1981, the Moderows entered into a transaction with American. They agreed to make eighty-four payments of $619.22 for the use of a mono-slope hog confinement building in their farming operation. The Moderows were required to make an initial payment of $1,857.66, or the sum of three monthly payments, prior to installation of the building. This initial payment was to be wholly applied toward the Moderows' obligation to American. Furthermore, the terms of the lease provided that title to the building would remain with American and that the building would be returned to American upon expiration of the lease.
American purchased the hog confinement building for $25,100, received the initial payment from the Moderows, and installed the building on their farm. The building consisted largely of concrete blocks, and could not be removed or severed without sustaining significant damage. In late 1983 or early 1984, the Moderows ran into financial difficulties and defaulted on their payments. Appellants and American engaged in negotiations to work out another payment arrangement, but to no avail. American filed a complaint to obtain money damages and replevin of the building on March 27, 1986. The Moderows counterclaimed, alleging that the transaction was subject to the Wisconsin Consumer Act (Act), chs. 421-27, Stats., and that American had violated several provisions of the Act and was thus liable for damages.
The case was scheduled to be tried to the court on January 29, 1987. However, respondent elected to proceed on that day in the context of a hearing on the merits. Both parties filed briefs, and the court issued a written decision on September 14, 1987. The trial court held that the transaction was not subject to the Act, found the Moderows in default of their lease, and entered judgment in favor of American for replevin, actual costs, attorney's fees and money damages. The total monetary award was $35,082.32, which included the principal sum still owed on the building of $29,080.28. This appeal arises from the judgment and order for judgment dated December 1, 1987. The Moderows claim that (1) the transaction is subject to the Act; (2) the transaction was a consumer credit sale disguised as a lease; and (3) American violated the Act by failing to disclose certain payment information, by obtaining a security interest in their land and crops, and by assessing an excessive finance charge on their transaction.
Whether or not the American-Moderow transaction is subject to the Act involves an application of the Act to the facts of this case. The application of a statute to a particular set of facts is a question of law. 1 An appellate court decides questions of law without deference to the trial court. 2
Appellants contend that because they paid three monthly payments totaling $1,857.66 prior to accepting the hog confinement building, its purchase price of $25,100 was reduced by that amount, and therefore the transaction was valued at $23,242.34. This valuation would bring the transaction within the $25,000 limit of the Act.
Section 421.202, Stats., provides:
Exclusions. Chapters 421 to 427 do not apply to:
....
(6) Consumer credit transactions in which the amount financed exceeds $25,000.00 or other consumer transactions in which the cash price exceeds $25,000.00.
Section 421.301, Stats., provides definitions of the terms used in sec. 421.202(6) as follows:
(5) "Amount financed" in a consumer credit transaction means the total of the following items from which any prepaid finance charge or required deposit balance has been excluded:
(a) In a consumer credit sale, the cash price of the real or personal property or services, less the amount of any downpayment whether made in cash or in property traded in, or, in a consumer loan, the amount paid to, receivable by or paid or payable to the customer or to another person in his behalf;
(b) In a consumer credit sale, the amount actually paid or to be paid by the creditor pursuant to an agreement with the customer to discharge a security interest in or a lien on property traded in; and
(c) To the extent not included in par. (a) or (b):
1. Any applicable sales, use, excise or documentary stamp taxes;
2. Amounts actually paid or to be paid by the creditor for registration, certificate of title or license fees; and
3. Additional charges permitted by s. 422.202.
....
(7) "Cash price" means the price at which property or services are offered, in the ordinary course of business, for sale for cash, and may include:
(a) The cash price of accessories or services related to the sale such as delivery, installation, alterations, modifications and improvements; and
(b) Taxes, to the extent imposed on the cash sale.
....
(13) "Consumer transaction" means a transaction in which one or more of the parties is a customer for purposes of that transaction.
....
(38) "Required deposit balance" means any deposit balance or any investment which the creditor requires the customer to make, maintain or increase in a specified amount or proportion as a condition to the extension of credit except:
....
(b) A deposit balance which will be wholly applied toward satisfaction of the customer's obligation in the transaction; ....
In the case at hand, the Moderows agreed to make eighty-four payments of $619.22 to American for a mono-slope hog confinement building. American purchased the...
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