Md. Arms Ltd. P'ship v. Connell

• Decision Date: 07 July 2010
• Docket Number: No. 2008AP1700.,2008AP1700.
• Citation: 2010 WI 64,786 N.W.2d 15,326 Wis.2d 300
• Parties: MARYLAND ARMS LIMITED PARTNERSHIP, Plaintiff-Respondent-Petitioner,v.Cari M. CONNELL and Linda J. Connell, Defendants-Appellants.
• Court: Wisconsin Supreme Court

326 Wis.2d 300

786 N.W.2d 15

2010 WI 64

MARYLAND ARMS LIMITED PARTNERSHIP, Plaintiff-Respondent-Petitioner,v.Cari M. CONNELL and Linda J. Connell, Defendants-Appellants.

No. 2008AP1700.

Supreme Court of Wisconsin.

Argued Jan. 6, 2010.

Decided July 7, 2010.

For the plaintiff-respondent-petitioner there was a brief by Randy J. Wynn, West Allis, and oral argument by Randy J. Wynn.

For the defendants-appellants there was a brief by James B. Connell and Crooks Low & Connell, S.C., Wausau, and oral argument by James B. Connell.

An amicus curiae brief was filed by William F. White, Clayton P. Kawski, and Michael Best & Friedrich LLP, Madison, on behalf of the Apartment Association of South Central Wisconsin, Inc., the Apartment Association of Southeastern Wisconsin, Inc., the Central Wisconsin Apartment Association, and the Lakeshore Apartment Association, Inc., and oral argument by Clayton P. Kawski.

ANN WALSH BRADLEY, J.

¶ 1 The petitioner, Maryland Arms Limited Partnership (Maryland Arms) seeks review of a published court of appeals decision reversing the circuit court's grant of summary judgment, which was in Maryland Arms' favor.¹ The court of appeals remanded the case to the circuit court with directions that summary judgment be entered instead for the defendants, Cari and Linda Connell.

¶ 2 Maryland Arms asserts that under an unambiguous sentence of its residential lease, Cari Connell (Connell) is liable for the damage to her apartment when her plugged-in hair dryer caused a fire. Although Maryland Arms acknowledges that her conduct was not negligent, it contends that Connell is liable because she had “control” of the hair dryer and “but for the acts of this tenant to introduce into this unit the hair dryer that caused the fire,” the fire damage would not have occurred. It further contends that the court of appeals erred when it determined that the residential lease was void as an attempt to contravene the public policy expressed in Wis. Stat. § 704.07. ²

¶ 3 Because the essential principle posed by Maryland Arms, “control,” does not appear in the sentence in question and because it is unclear that the parties intended that the conduct here would constitute an “act” that would impose liability on the tenant, we determine that the sentence in the residential lease is ambiguous. Further, the ambiguity is compounded when that sentence is read in the context of the paragraph as a whole, because Maryland Arms' construction of that sentence would render the preceding sentence surplusage. Thus, we conclude that the terms of the lease do not unambiguously provide that Connell is liable for the fire damage caused in part by her acts of bringing a hair dryer into the apartment and plugging it into an electrical outlet.

¶ 4 Given that our construction of the lease is dispositive, we decline to address whether any lease provision that assigned liability to a tenant for damages not caused by negligent acts or misuse would contravene the public policy set forth in Wis. Stat. § 704.07. Accordingly, we affirm the decision of the court of appeals, albeit on a different rationale.

I

¶ 5 The facts in this case are not in dispute. In 2004, Cari Connell was a 21-year-old student who leased a Milwaukee apartment from Maryland Arms. The lease was guaranteed by Connell's mother, Linda.

¶ 6 On July 7, 2006, Connell awoke to discover a fire in the bathroom of her apartment. She called the fire department and evacuated the building.

¶ 7 According to the fire investigation report issued by the Milwaukee Police Department, the fire originated in Connell's bathroom. The report described the fire as an “accidental fire” and identified a “plugged in hair dryer” as the “cause of fire.” The “cause of ignition” was listed as “unintentional,” and under the headline “Human Factors Contributing to Ignition,” the investigator checked the box labeled “none.” The officer issuing the fire investigation report declined to check a box labeled “negligent fire.”

¶ 8 Maryland Arms repaired the damaged apartment and presented Connell an invoice totaling $8,533.81. Connell did not pay. According to Connell Maryland Arms evicted her in August for failing to pay the bill and subsequently refused to return her security deposit.³

¶ 9 Maryland Arms filed suit in Milwaukee County Circuit Court, naming Connell and her mother as defendants. The complaint made no allegations of negligence. It did not contend that Connell mishandled the hair dryer or the electrical outlet in any way that made the hair dryer more likely to malfunction. Rather, it alleged that Connell was liable for the fire damage under the terms of the residential lease.

¶ 10 The complaint demanded reimbursement for the cost of repairing the apartment. It further alleged that Maryland Arms was unsuccessful in its attempts to re-rent the apartment in August 2006 and was therefore entitled to August rent. The complaint stated that Connell and her mother “refuse to pay the amounts referenced herein despite due demand having been made.” Maryland Arms attached the lease, the fire investigation report, and a list of itemized damages to the complaint.

¶ 11 Connell's answer asserted that “the fire which damaged [her apartment] was accidental in nature and not the result of negligence.” It further contended that neither the lease nor Wisconsin law permitted a claim for damages resulting from an accidental fire not caused by the negligent act of the tenant.⁴

¶ 12 The parties entered into a stipulation, agreeing in relevant part to the following facts: Maryland Arms' damages were correctly itemized; these damages were “caused by a fire, the origin of which came from a hair dryer owned by Cari Connell as described in the Milwaukee Police Department Fire Investigation Report”; and “Cari Connell did not previously know of any defect in said hair dryer.”

¶ 13 In their briefing and arguments at the circuit court, the parties focused on the terms of the lease signed by Connell, her mother, and Maryland Arms. The residential lease is a nine-page document, including attachments. It provides in relevant part:

Lessee shall be responsible for all intentional and negligent acts or breaches of this Lease by Lessee, Lessee's occupants, guests and invitees. Lessee shall be liable for all damage to the premises and appliances and equipment belonging thereto, in any way caused by the acts of Lessee, Lessee's occupants, guests and invitees.

Throughout this opinion, we refer to this provision in the lease as the “Liability Paragraph.” ⁵

¶ 14 Both parties moved for summary judgment. Maryland Arms cited to nine separate paragraphs in the lease and to one rule, but its brief in support of summary judgment did not analyze the language of the provisions it cited. Rather, it argued that Connell should be liable for the damage to the premises “because it was Cari Connell's hair dryer that caused the fire.” Connell asserted that a residential lease that imposed liability for non-negligent acts would be contrary to Wis. Stat. § 704.07 and therefore void.⁶ Additionally, Connell argued that the terms of the lease did not impose liability for non-negligent acts.

¶ 15 The circuit court acknowledged that “there was no negligence or improper use proved, or stipulated to, in this case.” Without explaining its construction of the terms of the lease, the circuit court stated that the second sentence of the Liability Paragraph “memorializes the parties' intent that the defendants would be liable for accidental fire damage.”

¶ 16 The circuit court determined that the Liability Paragraph did not contravene Wis. Stat. § 704.07, and thus Connell was “liable for the fire caused by the hair dryer.” The court granted Maryland Arms' motion for summary judgment. Judgment was entered in the amount of $9,342.31, including fees and costs.

¶ 17 The court of appeals reversed the decision of the circuit court. It agreed with Connell that “both the lease and Wis. Stat. § 704.07 ... require that Cari Connell must be negligent in connection with the fire as a precondition to the imposition of liability.” Maryland Arms Ltd. P'ship v. Connell, 2009 WI App 87, ¶ 3, 320 Wis.2d 147, 769 N.W.2d 145. The court remarked that “[i]f indeed the lessee is responsible for ‘all damage’ caused in any way by the lessee, the first sentence of the provision limiting Cari Connell's liability to damage caused by negligent acts or improper use is unnecessary.” Id., ¶ 5.

¶ 18 Despite its apparent conclusion that the lease did not impose liability for damage caused by a tenant's non-negligent acts, the court of appeals went on to conclude that the lease provision was void as “an attempt to waive the requirements of Wis. Stat. § 704.07.” Id., ¶ 1. It determined that the clear intent of Wis. Stat. § 704.07 “is to have the landlord shoulder the responsibility for fire repairs when there is no tenant negligence or improper use of the premises.” Because Cari Connell was not negligent and did not improperly use the premises the court of appeals concluded that Connell was not liable for the fire damage. Id., ¶ 14.

¶ 19 Maryland Arms petitioned this court, asking us to review the court of appeals' determination that the lease provision was void as an attempt to contravene the public policy expressed in Wis. Stat. § 704.07. Connell filed a response, contending that review was unnecessary. Further, she asserted that there was “an alternative ground that would support the result in this case.” Specifically, she asserted that the circuit court's construction of the lease was unreasonable because “the act of bringing a hair dryer into [the] apartment or plugging in a hair dryer” was not the cause of the fire, as the term “cause” is understood by its plain and ordinary meaning. We accepted review.

II

¶ 20 We review the grant or denial of a summary judgment motion using the same standards and method as are applied by the circuit court. Pawlowski v. Am. Family Mut. Ins. Co., 2009 WI 105, ¶...