Watts v. Watts

• Decision Date: 11 May 1987
• Docket Number: No. 85-0451,85-0451
• Parties: , 56 USLW 2011 Sue Ann WATTS (Evans), Plaintiff-Appellant v. James E. WATTS, Defendant-Respondent.
• Court: Wisconsin Supreme Court

Page 303

405 N.W.2d 303

137 Wis.2d 506, 56 USLW 2011

Sue Ann WATTS (Evans), Plaintiff-Appellant v. James E. WATTS, Defendant-Respondent.

No. 85-0451.

Supreme Court of Wisconsin.

Argued Feb. 6, 1987.

Decided May 11, 1987.

David G. Walsh, Madison, argued, for plaintiff-appellant; Margaret A. Satterthwaite, and Walsh, Walsh, Sweeney and Whitney, S.C., Madison, on brief.

Daniel G. Sandell, Madison, for defendant-respondent.

SHIRLEY S. ABRAHAMSON, Justice.

This is an appeal from a judgment of the circuit court for Dane County, William D. Byrne, Judge, dismissing Sue Ann Watts' amended complaint, pursuant to sec. 802.06(2)(f), Stats. 1985-86, for failure to state a claim upon which relief may be granted. This court took jurisdiction of the appeal upon certification by the court of appeals under sec. (Rule) 809.61, Stats. 1985-86. For the reasons set forth, we hold that the complaint states a claim upon which relief may be granted. Accordingly, we reverse the judgment of the circuit court and remand the cause to the circuit court for further proceedings consistent with this opinion.

The case involves a dispute between Sue Ann Evans Watts, the plaintiff, and James Watts, the defendant, over their respective interests in property accumulated during their nonmarital cohabitation relationship which spanned 12 years and produced two children. The case presents an issue of first impression and comes to this court at the pleading stage of the case, before trial and before the facts have been determined.

The plaintiff asked the circuit court to order an accounting of the defendant's personal and business assets accumulated between June 1969 through December 1981 (the duration of the parties' cohabitation) and to determine plaintiff's share of this property. The circuit court's dismissal of plaintiff's amended complaint is the subject of this appeal. The plaintiff rests her claim for an accounting and a share in the accumulated property on the following legal theories: (1) she is entitled to an equitable division of property under sec. 767.255, Stats. 1985-86; (2) the defendant is estopped to assert as a defense to plaintiff's claim under sec. 767.255, that the parties are not married; (3) the plaintiff is entitled to damages for defendant's breach of an express contract or an implied-in-fact contract between the parties; (4) the defendant holds the accumulated property under a constructive trust based upon unjust enrichment; and (5) the plaintiff is entitled to partition of the parties' real and personal property pursuant to the partition statutes, secs. 820.01 and 842.02(1), 1985-86, and common law principles of partition. ¹

The circuit court dismissed the amended complaint, concluding that sec. 767.255, Stats. 1985-86, authorizing a court to divide property, does not apply to the division of property between unmarried persons. Without analyzing the four other legal theories upon which the plaintiff rests her claim, the circuit court simply concluded that the legislature, not the court, should provide relief to parties who have accumulated property in nonmarital cohabitation relationships. The circuit court gave no further explanation for its decision.

We agree with the circuit court that the legislature did not intend sec. 767.255 to apply to an unmarried couple. We disagree with the circuit court's implicit conclusion that courts cannot or should not, without express authorization from the legislature divide property between persons who have engaged in nonmarital cohabitation. Courts traditionally have settled contract and property disputes between unmarried persons, some of whom have cohabited. Nonmarital cohabitation does not render every agreement between the cohabiting parties illegal and does not automatically preclude one of the parties from seeking judicial relief, such as statutory or common law partition, damages for breach of express or implied contract, constructive trust and quantum meruit where the party alleges, and later proves, facts supporting the legal theory. The issue for the court in each case is whether the complaining party has set forth any legally cognizable claim.

A motion to dismiss a complaint for failure to state a claim tests the legal sufficiency of the complaint. All facts pleaded and all reasonable inferences therefrom are admitted as true, but only for the purpose of testing the legal sufficiency of the claim, not for trial. Scarpaci v. Milwaukee County, 96 Wis.2d 663, 669, 292 N.W.2d 816, 18 A.L.R. 4th 829 (1980). A complaint should not be dismissed for failure to state a claim unless it appears certain that no relief can be granted under any set of facts that a plaintiff can prove in support of his or her allegations. Kranzush v. Badger State Mutual Cas. Co., 103 Wis.2d 56, 82, 307 N.W.2d 256 (1981). The pleadings are to be liberally construed to do substantial justice to the parties. Sec. 802.02(6), Stats. 1985-86; Scarpaci, supra, 96 Wis.2d at 669, 292 N.W.2d 816. Whether a complaint states a claim upon which relief may be granted is a question of law and this court need not defer to the circuit court's determination.

We test the sufficiency of the plaintiff's amended complaint by first setting forth the facts asserted in the complaint and then analyzing each of the five legal theories upon which the plaintiff rests her claim for relief.

I.

The plaintiff commenced this action in 1982. The plaintiff's amended complaint alleges the following facts, which for purposes of this appeal must be accepted as true. The plaintiff and the defendant met in 1967, when she was 19 years old, was living with her parents and was working full time as a nurse's aide in preparation for a nursing career. Shortly after the parties met, the defendant persuaded the plaintiff to move into an apartment paid for by him and to quit her job. According to the amended complaint, the defendant "indicated" to the plaintiff that he would provide for her.

Early in 1969, the parties began living together in a "marriage-like" relationship, holding themselves out to the public as husband and wife. The plaintiff assumed the defendant's surname as her own. Subsequently, she gave birth to two children who were also given the defendant's surname. The parties filed joint income tax returns and maintained joint bank accounts asserting that they were husband and wife. The defendant insured the plaintiff as his wife on his medical insurance policy. He also took out a life insurance policy on her as his wife, naming himself as the beneficiary. The parties purchased real and personal property as husband and wife. The plaintiff executed documents and obligated herself on promissory notes to lending institutions as the defendant's wife.

During their relationship, the plaintiff contributed childcare and homemaking services, including cleaning, cooking, laundering, shopping, running errands, and maintaining the grounds surrounding the parties' home. Additionally, the plaintiff contributed personal property to the relationship which she owned at the beginning of the relationship or acquired through gifts or purchases during the relationship. She served as hostess for the defendant for social and business-related events. The amended complaint further asserts that periodically, between 1969 and 1975, the plaintiff cooked and cleaned for the defendant and his employees while his business, a landscaping service, was building and landscaping a golf course.

From 1973 to 1976, the plaintiff worked 20-25 hours per week at the defendant's office, performing duties as a receptionist typist, and assistant bookkeeper. From 1976 to 1981, the plaintiff worked 40-60 hours per week at a business she started with the defendant's sister-in-law, then continued and managed the business herself after the dissolution of that partnership. The plaintiff further alleges that in 1981 the defendant made their relationship so intolerable that she was forced to move from their home and their relationship was irretrievably broken. Subsequently, the defendant barred the plaintiff from returning to her business.

The plaintiff alleges that during the parties' relationship, and because of her domestic and business contributions, the business and personal wealth of the couple increased. Furthermore, the plaintiff alleges that she never received any compensation for these contributions to the relationship and that the defendant indicated to the plaintiff both orally and through his conduct that he considered her to be his wife and that she would share equally in the increased wealth.

The plaintiff asserts that since the breakdown of the relationship the defendant has refused to share equally with her the wealth accumulated through their joint efforts or to compensate her in any way for her contributions to the relationship.

II.

The plaintiff's first legal theory to support her claim against the property accumulated during the cohabitation is that the plaintiff, defendant, and their children constitute a "family," thus entitling the plaintiff to bring an action for property division under sec. 767.02(1)(h), Stats. 1985-86, ² and to have the court "divide the property of the parties and divest and transfer the title of any such property" pursuant to sec. 767.255, 1985-86. ³

The plaintiff asserts that the legislature intended secs. 767.02(1)(h) and 767.255, which usually govern division of property between married persons in divorce or legal separation proceedings, to govern a property division action between unmarried cohabitants who constitute a family. The plaintiff points out that secs. 767.02(1)(h) and 767.255 are part of chapter 767, which is entitled "Actions Affecting the Family," and that in 1979 the legislature deliberately changed the title of the chapter from "Actions Affecting Marriage" to "Actions Affecting the Family." ⁴ The legislature has failed to provide any definition for "family" under ch. 767, or for that matter...