Lutzke by Lutzke v. Lutzke

• Decision Date: 31 January 1985
• Docket Number: No. 83-1197,83-1197
• Citation: 122 Wis.2d 24,361 N.W.2d 640
• Parties: In re the Marriage of William LUTZKE (Deceased), by his Personal Representative, William J. LUTZKE, Jr., Petitioner-Appellant, v. Vallerie LUTZKE, Respondent.
• Court: Wisconsin Supreme Court

Page 640

361 N.W.2d 640

122 Wis.2d 24

In re the Marriage of William LUTZKE (Deceased), by his

Personal Representative, William J. LUTZKE, Jr., Petitioner-Appellant, v. Vallerie LUTZKE, Respondent.

No. 83-1197.

Supreme Court of Wisconsin.

Argued Oct. 1, 1984.

Decided Jan. 31, 1985.

Michael A. Loduha, Manitowoc, for petitioner-appellant.

Ron A. Kaminski, Manitowoc, for respondent.

HEFFERNAN, Chief Justice.

This is an appeal from an order of the circuit court for Manitowoc county dismissing a petition of the personal representative of William Lutzke, William J. Lutzke, Jr., asking the court to find William's divorced wife, Vallerie, in contempt for failure to join in the sale of real estate jointly held by William and Vallerie during their marriage; or, in the alternative, for an order to modify the divorce judgment to provide that Vallerie now be ordered to sell the property. ¹

The circuit judge, Leon H. Jones, dismissed the petition because he concluded that the title status of the property was, as a matter of law, not affected by a divorce decree; hence, despite the direction of the divorce court to sell the property and then divide the proceeds, the joint tenancy persisted following the divorce and, upon the death of William, Vallerie became the sole title holder by right of survivorship.

Because we conclude that, whether a joint tenancy persists following a divorce is dependent either upon the intent of the parties to the divorce as evidenced in the proceedings or upon the subjective or manifested intent of the divorce judge, the trial court erred in its conclusion that a joint tenancy persists as a matter of law unless the sale of the property directed by the divorce judgment is in fact exercised. While it appears from the record that the parties had no express intent in respect to the severance of the joint tenancy, we are in doubt whether the trial judge at the time of the judgment intended to sever the tenancy. On the date of the order dismissing the petition of the personal representative, the trial judge assumed, erroneously we conclude, that the law of this state provided that, where there was a divorce judgment directing the sale of joint property, no severance of the tenancy would be effective until the sale.

We therefore vacate the order of the circuit court and remand the cause to the circuit court to give the judge thereof opportunity to clarify and construe his intention at the time of the decree. Did he or did he not intend to effect a severance at the time of the divorce judgment. In the event immediate severance was intended, the parties thereupon became tenants in common, and each of them acquired a separate estate in the property, which could be conveyed to third parties or be the subject of inheritance and no longer subject to the other co-tenant's right to acquire title to the entire property by survivorship. Additionally, the question is posed whether, if Vallerie acquired the estate by survivorship, she nevertheless was obligated financially by other terms of the judgment and those obligations were charges upon the land.

The basic facts are these. William Lutzke and Vallerie Lutzke, after a thirty-year marriage, were divorced in the circuit court (family court branch) of Manitowoc county. Findings of fact, conclusions of law, and the judgment of divorce were dated November 24, 1982. The findings of fact state that: "The parties are the owners of a home located [at] 4731 Highway 141, Manitowoc, Manitowoc County, Wisconsin...."

By the following language, the judgment ordered the parties to sell the home and divide the proceeds:

"7. PROPERTY DIVISION--Real Estate

"That the home of the parties ... is to be listed and sold and that the net proceeds of said sale are to be divided between the parties equally subject to the following exception:

"(a) That the petitioner husband is first to receive the sum of $3,000.00 from the net sale proceeds in full satisfaction and as a return of the traceable part of inheritance as received during the course of the marriage.

"(b) That the Guardian ad Litem's fee as submitted to the Court and approved by the Court as fair and reasonable is to be paid from the proceeds of the sale of the house one-half by each party noting that the petitioner is to receive a credit of $100.00 due to previous payments to the Guardian ad Litem. In addition, to the extent not previously paid at time of sale of the house, the attorneys fees for the respective parties shall be paid from the sale proceeds directly.

"(c) That any portion of the $500.00 loan together with interest as made by the Petitioner to the Respondent during the course of this action, if the same has not been applied to any arrearage of record or otherwise paid back shall be paid back to the petitioner from the respondent's share of the proceeds."

The judgment does not expressly sever the joint tenancy, nor does it state the form of ownership of the home. Although the fact of joint tenancy is not expressly set forth in the proceedings, it is assumed by all of the parties that William and Vallerie were joint tenants of the homestead property. The divorce judgment made no provision for the possession of the home pending sale, although the temporary order, issued January 25, 1982, by the family court commissioner, ordered the wife to vacate the residence and granted the husband the use of household furnishings and effects. The record shows he was in occupancy until his death.

The divorce judgment did not specify a price nor a time limit for the sale of the home. The house was appraised in April, 1982, at a market value of $44,500. The appraiser noted on his report that "[t]he present condition will make it very difficult to achieve a fair market sale here." The equalized value of the house, based on its assessed value in 1981, was $44,826.

On April 22, 1982, William and Vallerie Lutzke executed a listing contract with a real estate broker, listing the house for sale at $45,800. Vallerie Lutzke testified at the show cause hearing, which is the subject of this appeal, that no offers were received on this listing contract.

At a later time a listing contract with a different broker was executed by William Lutzke alone. According to the testimony of the real estate sales agent and Vallerie Lutzke, Vallerie Lutzke refused to sign the second contract. This second contract does not appear in the record, but Judge Jones' memorandum decision and order dismissing the "show cause" motion states that the second contract listed the house for sale at $41,900.

William Lutzke died on March 27, 1983. On April 10, 1983, an offer to purchase the house for $35,000 was received. On April 12, 1983, William Lutzke's son, William J. Lutzke, was appointed special administrator of the estate, with directions by the court to administer the estate in accordance with:

"the preservation of the estate and securing the property until the personal representative can be appointed and in addition, an offer to purchase on the real estate of the deceased Wm. N. Lutzke has been received and proper steps need to be taken to secure the estate's interest in the sale of said residence."

Within the next several days, the special administrator filed an action in Manitowoc County Circuit Court, captioned "Order to Show Cause Why the Judgment of Divorce Should Not be Modified." This document is dated April 14, 1983, and stamped "filed" on April 19, 1983. This order or motion demands that Vallerie Lutzke appear before Judge Leon Jones on April 19, 1983, to:

"show cause ... why the Judgment of Divorce should not be modified to compel the respondent [Vallerie Lutzke] to sell the homestead of the parties or in the alternative why the respondent should not be held in contempt for failing to reasonably pursue the homestead of the parties as ordered; and why the respondent should not be ordered to pay the costs of this action."

An affidavit of the special administrator, in support of the "show cause order" and an affidavit of Vallerie Lutzke's attorney, in opposition to the order, both state that Vallerie Lutzke rejected the $35,000 offer to purchase the home.

Except for a preliminary defense, soon abandoned, that the circuit court, family branch, did not have jurisdiction, Vallerie's principal defense was that, because the court's judgment of divorce did not sever the joint tenancy, upon the death of the co-tenant, William, she became the sole owner by right of survivorship and, therefore, had no obligation to sell. The position of William's estate was that the joint tenancy had been severed by the decree and, because thereafter he was owner of one-half of the property as a tenant in common, that, under the divorce decree, Vallerie's share of the co-tenancy was subject to a lien, equitable in nature, to secure payment of William's traceable $3,000 inheritance, a $500 loan, the guardian ad litem fees, and the attorney's fees. He also appears to argue that if, by some ratiocination, this court should conclude the entire joint property passes to Vallerie by survivorship, the property is, in accordance with the intent of Judge Jones, charged with the payment of one-half the value of the real estate to William's estate and is also subject to liens for the inheritance, loan, attorney's fees, and guardian ad litem fees.

The circuit judge in his memorandum decision concluded that the divorce judgment "did not in terms divest or transfer the real estate." He recognized, however, that Westerlund v. Hamlin, 188 Wis. 160, 205 N.W. 817 (1925), employed an analysis relying upon the intent of the trial judge at the time of the divorce judgment. Thus, Judge Jones acknowledged that there was Wisconsin authority that the trial judge's intent was relevant in determining whether the judgment in itself had the effect of terminating a joint tenancy. His analysis of Westerlund (with which we partially disagree) was that the language in respect to...