author: PATIENCE DRAKE ROGGENSACK, J.

text:
    Gary J. Howell, Plaintiff-Respondent, v. Orrin Denomie and Helen Denomie, Defendants-Appellants-Petitioners.
    Supreme Court

      No. 2003AP979-FT.

      Oral argument April 28, 2005.

      Decided June 22, 2005.

    2005 WI 81
    (Also reported in 698 N.W.2d 621.)

      For the defendants-appellants-petitioners there were briefs by Robert E. Haney, Alvin R. Ugent and Podell, Ugent & Haney, S.C., Milwaukee, and oral argument by Robert E. Haney.

    For the plaintiff-respondent there was a brief and oral argument by Robert C. Longwell, Jr., Galesville.
    An amicus curiae brief was filed by G. Michael Halfenger and Foley & Lardner, LLP, Milwaukee; and Jeffery O. Davis, and Quarles & Brady, LLP, Milwaukee, on behalf of the Appellate Practice Section, State Bar of Wisconsin, and there was oral argument by G. Michael Halfenger.

       Motion for reconsideration denied 9-30-05.

   PATIENCE DRAKE ROGGENSACK, J.

¶ 1. Or-rin and Helen Denomie seek review of an unpublished court of appeals summary order affirming a circuit court judgment finding the Denomies' answer and counterclaim frivolous and awarding Gary Howell attorney fees. The Denomies also seek review of the court of appeals conclusion that their appeal was frivolous. We conclude that the circuit court correctly determined that the Denomies' answer and counterclaim were frivolous, but that the court of appeals should not have concluded that the appeal was frivolous without first giving the parties and counsel a chance to be heard on that issue. However, because the Denomies had an opportunity to be heard regarding the frivolousness of the appeal in their briefs and at oral argument before this court, we reach the merits of their argument. In so doing, we agree with the court of appeals conclusion that the appeal was frivolous. Accordingly, we affirm the court of appeals.

I. BACKGROUND

¶ 2. This dispute arises over the sale of a parcel of land and house in Trempealeau, Wisconsin. The plaintiff, Howell, and defendants, Denomies, present different versions of the facts. Howell's version is as follows: he negotiated a price of $68,000 with the owners, Gregg and Cynthia Sikora, for the home. Howell then contacted the Denomies for financing. Glenn E. Brom-merich, senior vice president of Citizens State Bank, conducted the closing on April 17, 2000 with Gregg Sikora, Howell and the Denomies present. The deed filed for the sale of the property listed Howell as the purchaser, and the mortgage listed Howell as the mortgagor and the Denomies as the mortgagees. The De-nomies gave a cashier's check for $67,500 to the bank, and Howell signed a promissory note and real estate mortgage to the Denomies. Howell agreed to make monthly payments on the note and the Denomies received an amortization schedule for the amount of the promissory note.

¶ 3. In late 2001, the Denomies heard from Howell's father that Howell was going to make $20,000 on the sale of the house. In early December 2001, the Denomies retained an attorney, Allan Ohm, who sent Howell a Notice to Quit or Pay Rent for the month of November 2001 because the Denomies had not received a payment from Howell in November. Howell gave this notice to Brommerich, who contacted Ohm and explained Howell's ownership of the property. On December 18, 2001, Howell refinanced the property with Citizens State Bank. Brommerich sent the Denomies a cashier's check for $63,291.34, the remaining amount due based on the amortization schedule, as well as a Satisfaction of Mortgage form for the Denomies to sign. Ohm contacted Brommerich and told him that the Denomies questioned the final payoff amount, and that there was still $687.40 due on the note as a result of the missed November payment. Brommerich sent the De-nomies a check for the underpaid amount. The Denom-ies cashed both checks. On February 6, 2001, Citizens State Bank sent another letter to the Denomies urging them to sign the Satisfaction of Mortgage. The Denom-ies did not satisfy the mortgage, and Howell brought an action against them seeking a judgment satisfying and discharging the mortgage, penalty damages under Wis. Stat. § 706.05 (2001-02), actual damages, attorney fees and costs.

¶ 4. The Denomies presented a different view of the facts in their answer and counterclaim. They stated as follows: they agreed to purchase the house for Howell, rent it to him and sell it to him when he could afford to purchase it. Howell instead took their money, bought the property himself and fabricated the mortgage, thus fraudulently depriving them of ownership. Not knowing that this fraud had taken place, they reported the monthly payments from Howell as rent on their income tax filings. They refused to accept the final payments as satisfaction of Howell's debt because they claim they had never agreed to be a mortgage holder.

¶ 5. The matter was tried before the circuit court for Trempealeau County, Judge John A. Damon presiding. The court heard testimony from Brommerich, Howell and the Denomies. The court found the testimony of Brommerich and Howell relating Howell's version of the facts to be "entirely credible" and the testimony of Orrin Denomie to "be confused and not credible." The court also found that the unambiguous written documents showed that Howell had purchased the property and his agreement with the Denomies was a mortgage agreement. The court concluded that there was no basis for the counterclaim or the Denomies' assertion that they owned the property, as the deed indicated Howell was the purchaser and the credible testimony backed Howell's position. The court also found that the mortgage had not been satisfied by the Denomies, as was required by Wis. Stat. § 706.05. The court concluded that as a result of the Denomies' failure to satisfy the mortgage, Howell was entitled to statutory penalties totaling $2,000 and consequential damages totaling $2,267. The court also concluded that the Denomies' answer and counterclaim were frivolous under Wis. Stat. § 814.025, as they were "used and continued in bad faith and defendants and their attorney knew, or should have known, t[h]at the Counterclaim and defense were without any reasonable basis in law or equity and could not be supported by a good faith argument for extension, modification or reversal of existing law." The court entered judgment of $4,744.60 in attorney fees and taxable costs of $601.14.

¶ 6. The Denomies appealed the circuit court's judgment, arguing that they never agreed to the mortgage and that their defense was not frivolous. In a summary disposition, the court of appeals affirmed the circuit court's judgment and also concluded that the Denomies' appeal was frivolous, stating "we conclude that the Denomies' attorney should have known that his appellate argument is without any reasonable basis in law or in equity and cannot be supported by good faith argument for an extension, modification or reversal of existing law." The court awarded appellate attorney fees to Howell against Alvin Ugent, the Denomies' appellate attorney, and remanded to the circuit court for a determination of the amount of those fees.

¶ 7. The Denomies petitioned for review, which we granted. We specifically directed the parties to "address the procedure by which the court of appeals may determine an appeal is frivolous pursuant to Wis. Stat. § (Rule) 809.25(3)(c)."

II. DISCUSSION

A. Standard of Review

¶ 8. "A claim is frivolous under [Wis. Stat. § 814.025(3)(b)] if the party or attorney 'knew or should have known' that the claim was 'without any reasonable basis in law or equity.'" Stern v. Thompson & Coates, Ltd., 185 Wis. 2d 220, 240-41, 517 N.W.2d 658 (1994). The standard is objective: "whether the [party or] attorney knew or should have known that the position taken was frivolous as determined by what a reasonable [party or] attorney would have known or should have known under the same or similar circumstances." Id. at 241 (quoting Sommer v. Carr, 99 Wis. 2d 789, 799, 299 N.W.2d 856 (1981)). This inquiry involves a mixed question of law and fact. Stern, 185 Wis. 2d at 241. "Determining what was known or should have been known involves questions of fact. Such findings of fact will not be upset unless they are against the great weight and clear preponderance of the evidence." Id.; Sommer, 99 Wis. 2d at 792. "However,. . . the ultimate conclusion about whether what was known or should have been known supports a [determination] of frivolousness under [Section 814.025(3)(b)] is a question of law we review independently of the. . . circuit and appellate courts." Stern, 185 Wis. 2d at 241. "All doubts on this issue are resolved in favor of the party or attorney" whom it is claimed commenced or continued a frivolous action. Rabideau v. City of Racine, 2001 WI 57, ¶ 46, 243 Wis. 2d 486, 627 N.W.2d 795.

¶ 9. In regard to whether an appeal is frivolous, the standard is somewhat different because an appellate court decides whether an appeal is frivolous solely as a question of law. See J.J. Andrews, Inc. v. Midland, 164 Wis. 2d 215, 225, 474 N.W.2d 756 (Ct. App. 1991); Vierck v. Richardson, 119 Wis. 2d 394, 399, 351 N.W.2d 169 (Ct. App. 1984). To award costs and attorney fees, an appellate court must conclude that the entire appeal is frivolous. State ex rel. Robinson v. Town of Bristol, 2003 WI App 97, ¶ 54, 264 Wis. 2d 318, 667 N.W.2d 14. Sanctions for a frivolous appeal will be imposed if the court concludes that the "party or party's attorney knew, or should have known, that the appeal.. . [had no] reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification or reversal of existing law." Wis. Stat. § (Rule) 809.25(3)(c)2. Since the standard is objective, an appellate court looks to what a reasonable party or attorney knew or should have known under the same or similar circumstances. See J.J. Andrews, 164 Wis. 2d at 226.

B. Frivolous Answer and Counterclaim

¶ 10. The Denomies first challenge the circuit court judgment concluding that their answer and counterclaim were frivolous. They argue that while the circuit court based its determination of frivolousness on the lack of evidence tending to show that the Denomies were the owners of the property, they were not arguing that they were the owners. Rather, their position was that there was evidence in the record found by the circuit court to he "entirely credible" or stipulated to by counsel that supports their contention that there was no "meeting of the minds" between Howell and the Denomies to create a mortgage. The Denomies point to several pieces of evidence: (1) the stipulation that the Denomies did not sign the note, mortgage or amortization schedule at the closing; (2) Brommerich's testimony that he did not believe the Denomies received any paperwork following Howell's closing on the property; (3) the circuit court's finding that the Denomies had reported the payments they received from Howell as rent on their income tax returns; and (4) the finding that Orrin Denomie's testimony was "confused," rather than finding that either defendant was intentionally making misrepresentations. The Denomies argue that because this evidence supports their position, their answer and counterclaim cannot be found to be frivolous.

¶ 11. We reject the Denomies' argument. While they cite to language by the circuit court that it found "there's no basis . . . that [the Denomies] had any ownership in this house" for the proposition that the circuit court erroneously focused on the idea that the Denom-ies did not own the property rather than the theory put forth by the Denomies that there was no meeting of the minds regarding a mortgage agreement, examination of the circuit court's statements at trial and its final judgment show that the circuit court explicitly found there was indeed a mortgage agreement between Howell and the Denomies. In its oral ruling, the circuit court stated, "It appears from Mr. Brommerich's credible testimony that a check was given, a mortgage note and mortgage was filed, indicating what the agreement was. ... [Orrin Denomie was] present at everything... [s]o he knew exactly what was going on." The findings of fact stated, "Defendants, jointly and severally, made a mortgage loan to plaintiff for the purchase of the residence." Further support for the frivolous nature of the Denomies' argument is apparent when one asks the question: If the Denomies claim not to be owmers and they claim not to be mortgagees, what did they get for the money they paid at closing? Additionally, if they were not claiming that they owned the property, how could they claim that what Howell paid them was rent?

¶ 12. Next, we address the Denomies' argument that there was evidence in the record found by the circuit court to be "entirely credible" or stipulated to by counsel that supports their argument that there was no "meeting of the minds," therefore making it impossible as a matter of law for the answer and counterclaim to be frivolous. They rely on Stern for the proposition that a determination of frivolousness cannot be based on a "failure of proof," which they argue is the case here, but rather requires that there he "no set of facts which could satisfy the elements of the claim," Stern, 185 Wis. 2d at 243-44.

¶ 13. The Denomies misconstrue the language in Stern. While we agree with Stem that one way a claim could be frivolous is if a party "knows or should reasonably know that the facts necessary to meet the required elements of an allegation are not present and cannot be produced," id. at 244, that does not mean that presenting some evidence that is wholly insufficient to support a claim causes the claim to become nonfrivolous. As we have previously stated, a claim is frivolous if the party or attorney knew or should have known that the claim was without any reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification or reversal of existing law.

¶ 14. Our de novo evaluation of the facts found by the circuit court show that there is a mountain of evidence demonstrating that Howell was the owner of the property, that he and the Denomies entered into a mortgage agreement, and that the Denomies were aware of this, yet proceeded with their answer and counterclaim. Given what the circuit court found the Denomies knew or should have known regarding the transaction, the Denomies' initial position that Howell defrauded them out of ownership in the property and fabricated the mortgage was without any reasonable basis in law or equity.

¶ 15. The record overwhelmingly shows that the Denomies were aware of the transactions taking place. They were present at the closing and Brommerich testified that they witnessed the documents being signed. The Denomies incorrectly cite Brommerich's testimony to state that the Denomies never received any paperwork from the closing, as he stated that while he could not "positively say" whether the Denomies received a copy of the promissory note, it was the bank's policy to give copies, and in any case, Orrin Denomie testified that Howell gave them the documents "a day or two" after the closing. Howell testified that he paid the real estate taxes, flood insurance and property insurance on the property, and that even though he made numerous improvements to the property that the Denomies were aware of, including the addition of a deck, he never sought approval to make these improvements. The De-nomies accepted the payments of $63,291.34 and $687.40 that were inconsistent with the rental relationship that the Denomies claimed existed. Given all of this evidence that was known to the Denomies, we agree with the circuit court and the court of appeals that the Denomies' answer and counterclaim were frivolous.

C. Frivolous Appeal

¶ 16. The Denomies raise the issue of whether the court of appeals, on its own motion and without a hearing, can declare an appeal frivolous, as it did here. We also ordered the parties to "address the procedure by which the court of appeals may determine an appeal is frivolous pursuant to Wis. Stat. § (Rule) 809.25(3)(c)." We received briefing and heard oral argument from the parties and from a nonparty, the Appellate Practice Section of the State Bar of Wisconsin, on this issue.

¶ 17. The Denomies argue that the court of appeals should determine that an appeal is frivolous only if a separate motion on that issue is made by one of the parties, and because that did not happen here, the court of appeals erred in concluding the appeal was frivolous. Howell argues the court of appeals correctly determined the appeal was frivolous and it properly summarily made this determination. The Appellate Practice Section of the State Bar in its amicus brief opined that there should be notice and an opportunity to respond whenever the court of appeals is considering ruling that an appeal is frivolous. We agree with the Appellate Practice Section of the State Bar's position and conclude that in order to determine that an appeal is frivolous, the court of appeals is required to give notice that it is considering the issue. It must also give an opportunity to respond to the issue before a determination is made.

¶ 18. We have previously considered the issue of the court of appeals concluding an appeal is frivolous without a motion by a party in Weiland v. Paulin, 2003 WI 27, 260 Wis. 2d 277, 659 N.W.2d 875. In that case, the court of appeals, on its own motion, concluded that the appeal from a summary judgment was frivolous, and ordered that fees and costs be assessed solely against appellate counsel. Weiland v. Paulin, 2002 WI App 311, ¶ 29, 259 Wis. 2d 139, 655 N.W.2d 204. Unlike the summary order in the present case, the court of appeals detailed the various transgressions committed by appellate counsel. Id., ¶¶ 22-27. We responded to counsel's petition for review by issuing a summary order reversing the court of appeals conclusion that the appeal was frivolous and remanding the matter to the court of appeals with directions that: (1) the court of appeals must give the parties an opportunity to be heard regarding whether the appeal is frivolous; and (2) the court of appeals must specify the reasons why it has concluded that the appeal is or is not frivolous under Wis. Stat. § (Rule) 809.25(3)(c)2. Weiland, 260 Wis. 2d at 278.

¶ 19. In order for parties before the court of appeals to have the proper notice and opportunity to be heard, parties wishing to raise frivolousness must do so by making a separate motion to the court, whereafter the court will give the parties and counsel a chance to be heard. We caution that a statement in a brief that asks that an appeal be held frivolous is insufficient notice to raise this issue. The court of appeals may also raise the issue of a frivolous appeal on its own motion, but it must give notice that it is considering the issue and grant an opportunity for the parties and counsel to be heard before it makes a determination.

¶ 20. In the present case, Howell did not move the court of appeals to conclude that the appeal was frivolous, yet the court of appeals concluded that it was and awarded attorney fees against Attorney Ugent. It appears this was done without giving Ugent a chance to be heard. However, even though the Denomies did not have a proper opportunity to be heard at the court of appeals, we can determine the frivolousness of the appeal in this case because the Denomies did have an opportunity to be heard before this court. In both their briefs and at oral argument, the Denomies argued that the court of appeals incorrectly applied Riley v. Isaacson, 156 Wis. 2d 249, 456 N.W.2d 619 (Ct. App. 1990), which stated:

[W]e hold that upon an appeal from a ruling of frivolousness, the reviewing court need not determine whether the appeal itself is frivolous before it can award appellate costs and reasonable attorney's fees. Rather, if the claim was correctly adjudged to be frivolous in the trial court, it is frivolous per se on appeal.

Id. at 262.

¶ 21. This argument fails because not only did the court of appeals summary order not mention Riley or its analysis, but contrary to Riley, it specifically determined that the appeal itself was frivolous, stating "we conclude that the Denomies' attorney should have known that his appellate argument is without any reasonable basis in law or equity and cannot be supported by a good faith argument for an extension, modification or reversal of existing law." After considering the Denomies' arguments concerning the appeal in their briefs as well as on oral argument, we agree with the court of appeals. The appeal was frivolous. We therefore affirm the decision of the court of appeals.

III. CONCLUSION

¶ 22. We conclude that the circuit court correctly determined that the Denomies' answer and counterclaim were frivolous, but that the court of appeals should not have concluded that the appeal was frivolous without first giving the parties and counsel a chance to be heard on that issue. However, because the Denomies had an opportunity to be heard regarding the frivolousness of the appeal in their briefs and at oral argument before this court, we reach the merits of their argument. In so doing, we agree with the court of appeals conclusion that the appeal was frivolous. Accordingly, we affirm the court of appeals.

By the Court. — The decision of the court of appeals is affirmed.

        See Howell v. Denomie, No. 2003AP979-FT, unpublished order (Wis. Ct. App. Nov. 18, 2003).

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

       Under Wis. Stat. § 706.05(10)(b), "[a] mortgage-holder shall execute and record a mortgage satisfaction... within 7 days after both the mortgagor completes full performance and the mortgage-holder receives by certified mail a written request from the mortgagor for a full satisfaction." Section 706.05(10)(c) provides that the holder is "liable to the mortgagor for penalty damages of $100 for each day that the violation remains uncorrected, up to a total of $2,000, plus actual damages resulting from the violation."

       Wisconsin Stat. § 814.025 states:
      (1) If an action or special proceeding commenced or continued by a plaintiff or a counterclaim, defense or cross complaint commenced, used or continued by a defendant is found, at any time during the proceedings or upon judgment, to be frivolous by the court, the court shall award to the successful party costs determined under s. 814.04 and reasonable attorney fees.
      (2) The costs and fees awarded under sub. (1) may be assessed fully against either the party bringing the action, special proceeding, cross complaint, defense or counterclaim or the attorney representing the party or may be assessed so that the party and the attorney each pay a portion of the costs and fees.
      (3) In order to find an action, special proceeding, counterclaim, defense or cross complaint to be frivolous under sub. (1), the court must find one or more of the following:
      (a) The action, special proceeding, counterclaim, defense or cross complaint was commenced, used or continued in bad faith, solely for purposes of harassing or maliciously injuring another.
      (b) The party or the party's attorney knew, or should have known, that the action, special proceeding, counterclaim, defense or cross complaint was without any reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification or reversal of existing law.
      (4) To the extent s. 802.05 is appbcable and differs from this section, s. 802.05 applies.

       Wisconsin Stat. § (Rule) 809.25(3) states:
      (3) Frivolous appeals, (a) If an appeal or cross-appeal is found to be frivolous by the court, the court shall award to the successful party costs, fees, and reasonable attorney fees under this section.
      A motion for costs, fees, and attorney fees under this subsection shall be filed no later than the filing of the respondent's brief or, if a cross-appeal is filed, no later than the filing of the cross-respondent's brief. This subsection does not apply to appeals or cross-appeals under s. 809.107, 809.30, or 974.05.
      (b) The costs, fees and attorney fees awarded under par. (a) may be assessed fully against the appellant or cross-appellant or the attorney representing the appellant or cross-appellant or may be assessed so that the appellant or cross-appellant and the attorney each pay a portion of the costs, fees and attorney fees.
      (c) In order to find an appeal or cross-appeal to be frivolous under par. (a), the court must find one or more of the following:
      1. The appeal or cross-appeal was filed, used or continued in bad faith, solely for purposes of harassing or maliciously injuring another.
      2. The party or the party's attorney knew, or should have known, that the appeal or cross-appeal was without any reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification or reversal of existing law.

       The Denomies also raise the issue of whether the court of appeals erred in characterizing their appellate arguments as resting upon the "weight and credibility of the testimony" in the circuit court rather than the sufficiency of the evidence. Because we affirm the circuit court's determination of frivolousness above, we do not need to address this issue.

       We also note that the briefs filed in the court of appeals did not assert that the appeal was frivolous. Although, as we set out below, in order to act on a party's request to hold an appeal frivolous, a motion is required, we note the lack of any argument in the briefs as further evidence that the court of appeals holding was not made at the request of a party.

       We note that the facts here are unique in that the Denomies had the opportunity to argue whether their appeal was frivolous before this court in their briefs and at oral argument. We reiterate that the proper course of action for the court of appeals in future cases is to give notice and grant an opportunity for the parties and counsel to be heard before it makes a determination about whether an appeal is frivolous.


source: Caselaw Access Project

author: N. PATRICK CROOKS, J. JON E WILCOX, J.

license: Public Domain

text:
    In re the Termination of Parental Rights to Joshua S., a Person Under the Age of 18: Sheboygan County Department of Social Services, Petitioner-Respondent, v. Matthew S., Respondent-Co-Appellant, Rachel B., Respondent-Appellant-Petitioner.
    Supreme Court

      No. 2004AP901.

      Oral argument April 29, 2005.

      Decided June 22, 2005.

    2005 WI 84
    (Also reported in 698 N.W.2d 631.)

      For the respondent-appellant-petitioner there were briefs by John J. Grau and Grau Law Office, Waukesha, and oral argument by John J. Grau.

    For the petitioner-respondent the cause was argued by Mary T. Wagner, assistant district attorney, with whom on the brief was Joseph DeCecco, district attorney.

       Motion for reconsideration denied 10-17-05.

   N. PATRICK CROOKS, J.

¶ 1. Petitioner Rachel B. seeks review of an unpublished decision of the court of appeals affirming an order of the Sheboygan County Circuit Court for the termination, of her parental rights to Joshua S. Rachel B. argues on appeal that the circuit court lost competency to terminate her parental rights, because it violated the mandatory statutory time limitation set forth in Wis. Stat. § 48.422(2) (2003-04). The issue before this court is whether a competency challenge based on the violation of the statutory time limitation is waived if not first made before the circuit court.

¶ 2. We conclude such a competency challenge based on the violation of the statutory time limitation of Wis. Stat. § 48.422(2) cannot be waived, even though it was not raised in the circuit court. The court of appeals erred in extending the holding in Village of Trempealeau v. Mikrut, 2004 WI 79, 273 Wis. 2d 76, 681 N.W.2d 190, to violations of such a mandatory statutory time limitation under Wis. Stat. ch. 48. The circuit court did not hold the fact-finding hearing within the time limits established by § 48.422(2), and never granted a proper extension or continuance pursuant to Wis. Stat. §§ 48.315(1)(a) and (2), and thus it lost competency to proceed before it ordered the termination of Rachel B.'s parental rights. Accordingly, we reverse the decision of the court of appeals, which had affirmed the order of the circuit court.

W

¶ 3. Rachel B. gave birth to Joshua S. on October 10, 2001. On November 30, 2001, the circuit court determined that Joshua S. was at risk of physical abuse and in need of protection or services, pursuant to Wis. Stat. §§ 48.13(3m) and (10). The court ordered that Joshua S. be placed in a licensed foster home and imposed Children in Need of Protection or Services (CHIPS) conditions on Rachel B. and her husband, Ronald B. Ronald B. was presumed to be Joshua S.'s father, as he and Rachel B. were married at the time of conception. However, in January 2002, the Sheboygan County Circuit Court adjudicated Matthew S. as Joshua S.'s biological father. On January 8, 2002, Matthew S. began serving a ten-year prison sentence for the child abuse of Joshua S.'s half-brother.

¶ 4. On March 7, 2003, the social worker in Joshua S.'s case filed a Termination of Parental Rights (TPR) petition in regard to Rachel B. and Matthew S., pursuant to Wis. Stat. § 48.415(2). The petition stated the following:

Because of Matthew [S.'s] long-term incarceration and his previous violent behavior towards Joshua's half-brother; and because of [Rachel B.'s] inability to meet the conditions of the court order for well over a year and her lack of progress, it appears unlikely that either parent will be able to meet the conditions for the safe return of [Joshua S.] to their home within a one year period of any fact-finding hearing in this matter.

¶ 5. The circuit court appointed an attorney for Rachel B. and then conducted the initial hearing on the petition on March 27, 2003. The attorney for Rachel B. denied the grounds for termination of her parental rights. At this hearing, Matthew S.'s attorney denied the grounds for termination, discussed the possibility of a separate trial, indicated that he was planning to file a motion for severance, and stated that he would waive the time limits if the motion was granted.

¶ 6. Since the TPR petition was contested, there was a need to set a fact-finding hearing, pursuant to Wis. Stat. § 48.422(2). The circuit court originally scheduled this hearing before a jury for April 29 and 30, 2003, which fell well within the 45-day time period required by § 48.422(2). In a letter dated April 3, 2003, the deputy district attorney requested that the hearing be rescheduled, as he had a TPR trial scheduled for April 30 in another branch of the court. Matthew S.'s attorney also sent a letter to the court asking it to adjourn the hearing, as he would not be able to obtain a hearing date on a motion for severance before April 29 and 30. He also stated that he had scheduling conflicts on April 29.

¶ 7. Pursuant to these requests, the court notified the parties on April 4, 2003, that the fact-finding hearing was rescheduled for June 17 and 18, 2003. None of these actions occurred in open court or during a telephone conference on the record. On April 15, 2003, Matthew S. moved for severance of respondents, and thus for separate trials. The court scheduled a hearing for this motion on May 19, 2003. After these hearings were scheduled, Rachel B.'s attorney indicated that he had a conflict with the case and could no longer continue as her attorney. On April 23, 2003, a new attorney was appointed to represent Rachel B. Soon after his appointment, Rachel B.'s new attorney indicated that he had a scheduling conflict with the motion for severance hearing on May 19, and also asked for a rescheduling of the June 17 and 18 fact-finding hearing. With the court's permission, Rachel B.'s attorney participated in the May 19 motion hearing via telephone. At that hearing, the circuit court, John D. Murphy, Judge, denied Matthew S.'s motion for severance. The court referred counsel to the court clerk to schedule the fact-finding hearing before a jury. On June 4, 2003, the court notified the parties that the fact-finding hearing was rescheduled for November 18 and 19, 2003.

¶ 8. On June 12, 2003, the deputy district attorney moved the court for a new hearing date, expressing concern about the 45-day constraints set forth in Wis. Stat. § 48.422(2). The circuit court heard and granted this motion on June 27, 2003, and moved the dates for the fact-finding hearing to August 7 and 8,2003. Rachel B.'s attorney informed the court that he would be unavailable to represent her on those dates, and was later unsuccessful in finding a replacement. As a result, the court apparently took the fact-finding hearing off the calendar and scheduled a status conference for July 30, 2003.

¶ 9. While no record was made of that status conference, it appears that the court held another status conference on August 7, 2003, and rescheduled the fact-finding hearing for September 17, 2003. Prior to that hearing date, Judge Thomas S. Williams was substituted in place of Judge Terence J. Bourke, and a new attorney was appointed for Rachel B.

¶ 10. In accord with a conference call on August 28, 2003, the court held a motion hearing on September 12, 2003, to address various motions. The court granted severance of Matthew S.'s fact-finding hearing from Rachel B.'s. Although another formal motion was not made to that effect, all of the parties agreed to severance, and the circuit court accepted the stipulation.

¶ 11. Matthew S.'s fact-finding.hearing was then scheduled for September 17, 2003. At his hearing, all four special verdict questions were answered in the affirmative, thus indicating, among other things, that he would not be able to meet the CHIPS conditions within the 12-month period after the hearing. Rachel B.'s fact-finding hearing was postponed until October 15, 16, and 17, 2003. At her hearing, all four special verdict questions were also answered in the affirmative.

¶ 12. On October 30, 2003, the circuit court entered a dispositional order terminating the parental rights of both Matthew S. and Rachel B., pursuant to these jury verdicts. The record does not indicate that either the parents or Sheboygan County or the guardian ad litem raised the issue regarding the circuit court's competency to hear the cases. Both Matthew S. and Rachel B. timely appealed.

¶ 13. On appeal, Rachel B. argued that, pursuant to Wis. Stat. § 48.422(2), the circuit court lost competency to proceed with her case on May 12, 2003, 45 days after the initial hearing on the termination petition. Because her fact-finding hearing did not occur until October 15,16, and 17, 2003, she claimed that the court did not have competency to order the termination of her parental rights. In an unpublished opinion, the court of appeals affirmed the termination of her parental rights on August 25, 2004. Court of appeals Judge Richard S. Brown, relying on Village of Trempealeau v. Mikrut, held that Rachel waived her claim by not raising it before the circuit court. The court extended the holding in Mikrut to competency challenges based on the violation of the statutory time constraints at issue. As a result, the court of appeals affirmed the order of the circuit court terminating Rachel B.'s parental rights to Joshua S.

¶ 14. Rachel petitioned this court to review the decision of the court of appeals, and we granted her petition and now reverse.

H — I

¶ 15. The issue we address is whether a competency challenge based on the violation of the statutory time limitation of Wis. Stat. § 48.422(2) of the Children's Code is waived, even though it was not raised in circuit court. This presents a question of law. We therefore review this question de novo, benefiting from the analyses of the circuit court and court of appeals. See Mikrut, 273 Wis. 2d 76, ¶ 7; State v. Kywanda F., 200 Wis. 2d 26, 32-33, 546 N.W.2d 440 (1996).

¶ 16. Competency has been defined as the court's power to exercise subject matter jurisdiction. Kohler Co. v. Wixen, 204 Wis. 2d 327, 337, 555 N.W.2d 640 (Ct. App. 1996). The concept of competency is narrower than that of subject matter jurisdiction, because while the constitution confers subject matter jurisdiction on the courts, the state legislature may limit the ability of the courts to exercise that power by statute. See Wis. Const. art. VII, § 8; Wis. Stat. § 801.04. "Such a legislative enactment affects that court's competency to proceed rather than its subject matter jurisdiction. Cepukenas v. Cepukenas, 221 Wis. 2d 166, 170, 584 N.W.2d 227 (Ct. App. 1998). Competency is of central importance in this case, since the failure to comply with mandatory time limits under the Children's Code may result in the loss of the circuit court's competency to proceed. State v. April O., 2000 WI App 70, 5, 233 Wis. 2d 663, 607 N.W.2d 927.

¶ 17. The legislative history of the Children's Code has been summarized previously by Wisconsin courts, so it is unnecessary that we provide great detail here. In re B.J.N., 162 Wis. 2d 635, 645, 469 N.W.2d 845 (1991); see also In re R.H., 147 Wis. 2d 22, 433 N.W.2d 16 (Ct. App. 1988). However, we do highlight some important revisions, in order to clarify the legislative intent behind the statutory time limits at issue. When the Children's Code was first enacted, "there were'no statutorily authorized time limits for the processing of cases in the juvenile court,' the lack of which often resulted in an abuse of detention." B.J.N., 162 Wis. 2d at 646 (citing Wisconsin Council on Criminal Justice, Juvenile Justice Standards and Goals 81 (Dec. 1975)). In 1977 and 1979, however, the Code was substantially revised to include numerous time limitations, which were established to protect constitutional due process rights. B.J.N., 162 Wis. 2d at 646; R.H., 147 Wis. 2d at 27-31. "The legislative history of the Children's Code shows that the legislature considers that strict time limits between critical stages within the adjudication process are necessary to protect the due process rights of children and parents." R.H., 147 Wis. 2d at 33.

¶ 18. As stated above,.the time limit in this case requires that a fact-finding hearing be held within 45 days of a party contesting the petition for termination of parental rights. Wis. Stat. § 48.422(2). While all time limits set forth in the Children's Code are intended to be mandatory, the legislature provided that noncompliance with the time limits may not always result in the loss of competency. See April O., 233 Wis. 2d 663, ¶ 5. Time limits under Wis. Stat. ch. 48 may be delayed, continued, or extended, pursuant to Wis. Stat. § 48.315.

¶ 19. Sheboygan County argues that here the application of Wis. Stat. § 48.315 extended the circuit court's competency to terminate Rachel B.'s parental rights. Specifically, it argues that the 45-day time limit mandated by Wis. Stat. § 48.422(2) was tolled by Matthew S.'s motion for severance, pursuant to § 48.315(1)(a). This statute reads:

(1) The following time periods shall be excluded in computing time requirements within this chapter:
(a) Any period of delay resulting from other legal actions concerning the child or the unborn child and the unborn child's expectant mother, including an examination under s. 48.295 or a hearing related to the mental condition of the child, the child's parent, guardian or legal custodian or the expectant mother, prehear-ing motions, waiver motions and hearings on other matters.

According to Sheboygan County, the effect of Matthew S.'s motion for severance, in light of this statute, was to toll the 45-day time limit for an additional 34 days, expanding the statutory deadline to June 13, 2003.

¶ 20. Sheboygan County also argues that the circuit court properly continued the case for good cause; pursuant to Wis. Stat. § 48.315(2). It contends that at the hearing on the motion for severance on May 19, 2003, the court noted on the record that there were scheduling conflicts and that the fact-finding hearing would need to be postponed. Sheboygan County argues that these scheduling conflicts constituted good cause, thus triggering a permitted continuance under § 48.315(2).

¶ 21. In opposition to this argument, Rachel B. claims that the court lost competency when it violated the time limitation set forth in Wis. Stat. § 48.422(2), and that this deadline was never properly continued nor the time period tolled. In response to Sheboygan County's first argument, that Matthew S.'s motion for severance tolled the statute, Rachel B. contends that the filing of this motion had no effect on the violation of the mandatory time limit. In Wis. Stat. § 48.315(l)(a), the statute excludes "any period of delay resulting from other legal actions concerning the child" when computing time requirements within the Children's Code. Rachel B. argues that because the motion for severance was not filed until after the court had already extended the time for the fact-finding hearing, the period of delay could not be "resulting from" Matthew S.'s motion.

¶ 22. We agree with Rachel B. that Matthew S.'s motion for severance did not toll the statutory time limit set forth in Wis. Stat. § 48.422(2). Because the initial appearance was held for both Rachel B. and Matthew S. on March 27, 2003, and the petition was contested at that time, the statutory deadline for the fact-finding hearing was May 12, 2003. However, on April 3, 2003, the court rescheduled the fact-finding hearing to June 18, 2003. Matthew S. did not file his motion for severance until April 15, 2003, after the fact-finding hearing had already been rescheduled. As a result, the delay in the fact-finding hearing did not result from the filing of the severance motion. Because the motion for severance was filed after the fact-finding hearing was already rescheduled, Sheboygan County's argument is not persuasive.

¶ 23. In response to Sheboygan County's second argument, Rachel B. contends that there never was a continuance of the fact-finding hearing, in accord with Wis. Stat. § 48.315(2). She argues that the circuit court failed to acknowledge in open court or in a telephone conference on the record that the hearing was continued for good cause, as is required by the statute. She also relies on the court of appeals' decision in April O. In April O., the parents argued on appeal that the circuit court did not have competency to terminate their parental rights, since the circuit court failed to hold their initial and dispositional hearings within the mandatory time limits set forth in Wis. Stat. §§ 48.422 and 48.424(4) (1997-98). April O., 233 Wis. 2d 663, ¶ 5. In that case, the circuit court determined on the record that good cause existed to extend the time limits, pursuant to Wis. Stat. § 48.315(2), but it did so only after the time limits had already expired. The court of appeals therefore concluded that "[o]nce a court has lost competency it cannot, in a later proceeding, find good cause for a delay and thereby restore competency." Id., ¶ 10. Accordingly, the court of appeals determined that the circuit court had lost competency to proceed and vacated the termination order of the circuit court.

¶ 24. We agree with Rachel B. that the there was no determination of good cause in open court or during a telephone conference on the record. In this case, similar to April O., the circuit court did not make a finding of good cause during the March 27, 2003 hearing. When the fact-finding hearing was rescheduled for the first time on April 4, 2003, and set for June 17, 2003, that date was outside of the statutorily required 45 days. The court notified the parties by letter, without a showing of good cause in open court or during a phone conference on the record. On March 27, 2003, the only mention of a potential scheduling problem was when Matthew S.'s attorney raised the possibility of severance, and the circuit court noted that the fact-finding hearing had to be held within 45 days. Therefore, when the time limit expired without a continuance in accord with Wis. Stat. § 48.315(2), the circuit court lost competency to proceed. In other words, "the circuit court never granted a continuance at any proceeding before the time limits expired and therefore did not do so in open court and in a 'timely manner.'" April O., 233 Wis. 2d 663, ¶ 10. Accordingly, Sheboygan County's arguments to extend the competency of the court, pursuant to Wis. Stat. § 48.315(2), fails.

¶ 25. Sheboygan County next argues that the court of appeals correctly applied Village of Trempealeau v. Mikrut in determining that a challenge to a circuit court's competency is waived if not raised in the circuit court. In Mikrut, the defendant was adjudged guilty of 21 violations of local ordinances. On appeal, he argued that defects in the issuance of these citations caused the circuit court to lack competency, and that the judgments against him thus were void. Mikrut, 273 Wis. 2d 76, ¶ 6. This court held that competency does not equate to subject matter jurisdiction, and that such a challenge to the circuit court's competency is waived if not raised in the circuit court. Id., ¶ 3. "The Mikrut court, however, backed off from adopting a categorical rule that all competency objections must be made at circuit court or be waived." State v. Michael S., 2005 WI 82, ¶ 71, 282 Wis. 2d 1, 698 N.W.2d 673 (citing Mikrut, 273 Wis. 2d 76, ¶ 30).

¶ 26. Rachel B., on the other hand, argues that the court of appeals misinterpreted the holding in Mikrut and improperly extended the waiver rule. She contends that this issue should be controlled by our decision in B.J.N. In that case, a petition was filed to extend a dispositional order beyond the 30-day extension allowed by Wis. Stat. § 48.365(6) (1987-88). B.J.N., 162 Wis. 2d at 643. This court held that such an extension was not proper and, with regard to the issue of waiver, concluded that "a party cannot waive the right to object to a court's loss of competence once the 30-day extension has passed without a hearing." Id. at 658. In so holding, the court emphasized that "[a]n objecting party's failure to expressly raise the loss of competence at the earliest available moment cannot revive an order which has expired and no longer carries any force of law." Id. Rachel B. argues that this reasoning should be applied to similar mandatory statutory time limits within the Children's Code, such as the 45-day deadline set forth in Wis. Stat. § 48.422(2).

¶ 27. In our analysis of the waiver rule, we recognize that the Mikrut court did not address whether mandatory statutory time limitations can be waived. In that case, this court stated:

[T]here is an established line of cases holding, in conclusory fashion, that competency challenges premised upon noncompliance with mandatory statutory time limitations cannot be waived. Because the competency challenge in this case is not premised upon noncompliance with statutory time limitations, we do not address the issue of waiver in this context except to note that these cases appear to simply perpetuate by rote the rule in older case law that statutory time limitations are "jurisdictional" and therefore cannot be waived.

Mikrut, 273 Wis. 2d 76, ¶ 3 n.1 (citation omitted).

¶ 28. Although we acknowledged in Mikrut that there was case law holding that mandatory statutory time limitations under Wis. Stat. ch. 48 cannot be waived, we noted some concern with the continued viability of such case law. Mikrut, 273 Wis. 2d 76, ¶ 12 n.4. Pursuant to this concern, the Mikrut court highlighted recent legislation, particularly Wis. Stat. § 48.315(2xn)(b). This amendment to § 48.315, discussed in Mikrut, specifies that "failure to comply with time limits specified in par. (a) does not deprive the court of personal or subject matter jurisdiction or of competency to exercise that jurisdiction." Wis. Stat. § 48.315(2m)(b).

¶ 29. The court of appeals interpreted Mikrut as controlling the case before us. Relying on Mikrut, the court of appeals held that Rachel B.'s competency challenge came too late, because it was not raised in the circuit court. Sheboygan County v. Matthew S., No. 2004AP901, unpublished slip op., ¶ 25 (Wis. Ct. App. Aug. 25, 2004). The court's rationale for extending Mikrut was as follows:

Mikrut purported not to extend its holding to competency challenges based on violations of mandatory statutory time limitations, which were not at issue in that case. However, the sweeping language of that holding convinces us that the court would do so in a case where the issue was properly raised. Because we therefore conclude that it meant to sub silentio overrule all cases necessitating a contrary result, this court cannot in good conscience decline to follow Mikrut in this case.

Id., ¶ 25 (footnotes omitted).

¶ 30. We agree with Rachel B. that the waiver rule adopted in Mikrut does not extend to this case. In Mikrut, we declined to overrule B.J.N. or its progeny, and specifically refrained from extending our holding to cases involving competency challenges based on violations of statutory time limitations. See Mikrut, 273 Wis. 2d 76, ¶ 3 n.1. "Thus, the waiver rule of Mikrut does not, according to Mikrut, control the outcome of this case. The present case involves a statutory time period that Mikrut left undisturbed." Michael S., 282 Wis. 2d 1, ¶ 73. We therefore conclude, consistent with Michael S., Mikrut, and that a competency challenge such as the one here, based on the court's failure to act within the statutory time periods listed within Wis. Stat. ch. 48, cannot be waived, even though it was not raised in the circuit court.

¶ 31. We also conclude that recent changes to the Children's Code do not affect our decision in this case, nor did the changes overrule B.J.N. and April O: sub silentio. Both the court of appeals and Sheboygan County noted that since those cases were decided, the Wisconsin Legislature has amended Wis. Stat. § 48.315 to specify that the "failure to comply with time limitations for continuances, extensions of time or periods of delay in Ch. 48 'does not deprive the court of personal or subject matter jurisdiction or of competency to exercise that jurisdiction. .. .'" See Mikrut, 273 Wis. 2d 76, ¶ 12 n.4; Wis. Stat. § 48.315(2m)(b). In doing so, Sheboygan County contends that the legislature clearly intended to afford competency to courts after violations of any time limit within Wis. Stat. ch. 48.

¶ 32. Rachel B., on the other hand, argues that the court of appeals did not properly interpret and apply the recent amendment to Wis. Stat. § 48.315 and its effect on competency. She contends that because Mikrut omitted language from the statutory text, that the court of appeals inappropriately broadened the scope of the statute. We agree. The Mikrut court left out the first line of § 48.315(2m)(b) when it discussed the new legislation and its effect on competency. The first line of the statutory language in subsection (2m) (b) is as follows: "Failure to comply with any time limit specified in par. (a). . . Wis. Stat. § 48.315(2m)(a) (emphasis added). Thus, only a failure to comply with the time limits in subsection (2m) (a) 1. and 2. will trigger the application of subsection (2m) (b), and thus save the court's personal or subject matter jurisdiction or competency to exercise that jurisdiction.

¶ 33. The text of Wis. Stat. § 48.315(2m)(a) does not mention the mandatory statutory time limit presented in this case. Here, the time limit in question is the 45-day period between the March 27 date, where the petition for termination of parental rights was contested, and the date that the fact-finding hearing was to be held. In contrast, Wis. Stat. § 48.315(2m)(a) only applies to the following:

No continuance or extension of a time limit specified in this chapter may be granted and no period of delay specified in sub. (1) may be excluded in computing a time requirement under this chapter if the continuance, extension, or exclusion would result in any of the following:
1. The court making an initial finding under s. 48.21(5)(b)l., 48.355(2)(b)(6)., or 48.357(2v)(a)l. that reasonable efforts have been made to prevent the removal of the child from the home, while assuring that the child's health and safety are the paramount concerns, or an initial finding under s. 48.21(5)(b)3., 48.355(2)(b)6r., or 48.357(2v)(a)3. that those efforts were not required to be made because a circumstance specified in s. 48.355(2d)(b)l. to 5. applies, more than 60 days after the date on which the child was removed from the home.
2. The court making an initial finding under s. 48.38(5m) that the agency primarily responsible for providing services to the child has made reasonable efforts to achieve the goals of the child's permanency plan more than 12 months after the date on which the child was removed from the home or making any subsequent findings under s. 48.38(5m) as to those reasonable efforts more than 12 months after the date of a previous finding as to those reasonable efforts.

Therefore, without any express language incorporating Wis. Stat. § 48.422(2) into subsection (a) of Wis. Stat. § 48.315(2m), subsection (b) of the same statute is not triggered, and thus it is inapplicable to the competency challenge in this case. Moreover, this recent amendment to the Children's Code does not affect our reliance on either B.J.N. or April O. Neither of those cases involved circumstances that would trigger § 48.315(2m)(b). Section 48.315(2) was correctly applied in those cases, and the decisions finding a loss of competency would not have been changed even if this amendment had been in effect.

¶ 34. We are convinced by the plain reading of the statute that the legislature did not intend to extend competency for all violations of time deadlines outlined in the Children's Code. If this were truly its intent, it would have said as much in the statute. See State ex rel. Kalal v. Circuit Court, 2004 WI 58, ¶¶ 45-46, 271 Wis. 2d 633, 681 N.W.2d 110. Although we interpret the statute as unambiguous, our conclusion is bolstered when we contrast the language of Wis. Stat. § 48.315(2m) with that of Wis. Stat. § 938.315(3) of the Juvenile Justice Code. In the latter statute, the legislature stated: "Failure to comply with any time limit specified in this chapter does not deprive the court of personal or subject matter jurisdiction or of competency to exercise that jurisdiction." Wis. Stat. § 938.315(3) (emphasis added).

¶ 35. While Wis. Stat. § 48.315(2m)(b) uses much of the same language as Wis. Stat. § 938.315(3), it did not save competency for a violation of "any time limit specified in this chapter. . .." Wis. Stat. § 938.315(3). Instead, it limited the statute's scope to "any time limit specified in par. (a)." It is also important to note that § 48.315(2m)(b) became effective several years after the legislature adopted the Juvenile Justice Code in 1995. Therefore, it is reasonable to conclude that the legislature considered, and then rejected, the adoption of the exact language that was used in § 938.315(3).

¶ 36. Because of the clear statutory language and legislative intent behind these statutes, we must emphasize the importance of strictly following the provisions of Wis. Stat. ch. 48. While we recognize the need for flexibility in the Children's Code, we believe the legislature addressed this problem with the enactment of Wis. Stat. § 48.315. In this case, for example, the court perhaps could have granted a continuance if it had recognized good cause for the delay in open court or during a telephone conference on the record. Without such action, however, there is no choice for us but to follow the plain language of the statutes, and to hold that the court lost competency to proceed before it ordered the termination of Rachel B.'s parental rights. In a similar situation in April O., the court of appeals understanding^ lamented:

(Statutory language) compels us to reach a result in this case that is, to say the least, unfortunate. .. . [T]he object of the Children's Code is to protect the best interests of the children. ... We empathize with the circuit court that this is not a good result for the children. However, we may not rewrite clear statutory language....

April O., 233 Wis. 2d 663, ¶ 12. We are satisfied, however, that children such as Joshua S., and their parents, clearly have a due process right to have these decisions determined within the time limits set by the legislature, unless statutory provisions for a continuance are followed. See B.J.N., 162 Wis. 2d at 649; R.H., 147 Wis. 2d at 33.

HH HH

¶ 37. In sum, we conclude that a competency challenge based on the violation of the statutory time limitation of Wis. Stat. § 48.422(2) cannot be waived, even though it was not raised in the circuit court. The court of appeals erred in extending the holding in Mikrut to violations of such a mandatory statutory time limitation under Wis. Stat. ch. 48. The circuit court did not hold the fact-finding hearing within the time limits established by § 48.422(2), and never granted a proper extension or continuance pursuant to Wis. Stat. §§ 48.315(l)(a) and (2), and thus it lost competency to proceed before it ordered the termination of Rachel B.'s parental rights. Accordingly, we reverse the decision of the court of appeals, which had affirmed the order of the circuit court.

By the Court. — The decision of the court of appeals is reversed.

JON E WILCOX, J.

¶ 38. (dissenting). Wisconsin Stat. § 48.01(1) (2003-04) provides: "In construing this chapter, the best interests of the child or unborn child shall always be of paramount consideration." Because the majority adopts an interpretation of Wis. Stat. § 48.315(2m)(b) that is inconsistent with the text of the statute and in contravention of the best interests of children, I dissent.

¶ 39. Section 48.315(2m)(b) provides, in pertinent part: "Failure to comply with any time limit specified in par. (a) does not deprive the court of personal or subject matter jurisdiction or of competency to exercise that jurisdiction." Wisconsin Stat. § 48.315(2m)(a) governs the granting of a continuance or extension "of a time limit specified in this chapter. . . ." (Emphasis added.)

¶ 40. Thus, this court was correct in Village of Trempealeau v. Mikrut, 2004 WI 79, ¶ 12 n.4, 273 Wis. 2d 76, 681 N.W.2d 190, when we stated that § 48.315(2m)(b) "specif[ies] that failure to comply with time limitations for continuances, extensions of time or periods of delay in Ch. 48 'does not deprive the court of personal or subject matter jurisdiction or of competency to exercise that jurisdiction.'" Given that § 48.315(2m)(a) applies to granting continuances or extensions "of a time limit specified in this chapter," Mikrut was correct in stating that § 48.315(2m)(b) is similar to Wis. Stat. § 938.315(3), in that both apply to any time period in the respective chapter. Id.

¶ 41. The majority erroneously concludes that the operation of § 48.315(2m)(b) is limited to those time periods specified in subdivisions 1.-2. of § 48.315(2m)(a). Majority op., ¶ 32. Contrary to the assertion of the majority, the statute says no such thing. While § 48.315(2m)(a) provides that a court may not grant a continuance or extension if the continuance or extension would result in certain other time limits specified in subdivisions 1.-2. being violated, the application of § 48.315(2m)(b) is not limited to those time periods enumerated in subdivisions 1.-2. of § 48.315(2m)(a). Rather, the text of § 48.315(2m)(b) expressly applies to "any time limit specified in par. (a)." As paragraph (a) governs the granting of continuances and extensions "of a time limit specified in this chapter[,]" it is of no consequence that paragraph (a) "does not mention the mandatory time limit presented in this case." Majority op., ¶ 33.

¶ 42. In addition to being inconsistent with the text of the statute, the majority's interpretation of § 48.315(2m)(b) fails to adhere to the legislative mandate that in construing all provisions of chapter 48, "the best interests of the child or unborn child shall always be of paramount consideration." Wisconsin Stat. § 48.01(1). The time period at issue in this case, Wis. Stat. § 48.222(2), was not met in large part due to scheduling conflicts between the parties' attorneys. See majority op., ¶¶ 6-7. The majority fails to explain how interpreting § 48.315(2m)(b) in such a manner so as to deprive a circuit court of its competency to adjudicate the termination of parental rights (TPR) petition under these circumstances is in the best interests of Joshua S. The interests of children, such as Joshua S., are best protected by interpreting § 48.315(2m)(a) & (b) in conformity with their plain language so as to allow a circuit court to retain competency over the TPR petition if a time period within chapter 48 has not been met.

¶ 43. Accordingly, I would hold that pursuant to § 48.315(2m)(a) & (b), a circuit court does not lose competency when it fails to comply with the time period set forth in § 48.222(2). This interpretation conforms to the plain statutory language and the best interests of the child sought to be protected by the TPR petition. Therefore, I would affirm the order of the circuit court.

¶ 44. I am authorized to state that Justices DAVID T. PROSSER and PATIENCE DRAKE ROGGENSACK join in this dissent.

       Unless otherwise indicated all references to the Wisconsin Statutes are to the 2003-04 edition.
      Wisconsin Stat. § 48.422(2) states: "If the petition is contested the court shall set a date for a fact-finding hearing to be held within 45 days of the hearing on the petition, unless all of the necessary parties agree to commence with the hearing on the merits immediately."

       "The general requirements of § 48.315(2) control all extensions of time deadlines under the Children's Code." State v. April O., 2000 WI App 70, ¶ 5, 233 Wis. 2d 663, 607 N.W.2d 927.
      Wisconsin Stat. § 48.315(2) states: "A continuance shall be granted by the court only upon a showing of good cause in open court or during a telephone conference under s. 807.13 on the record and only for so long as is necessary, taking into account the request or consent of the district attorney or the parties and the interest of the public in the prompt disposition of cases."

       On September 5, 2002, the circuit court granted the Sheboygan County's Department of Social Services petition to amend the CHIPS order to reflect the change in paternity.

       The social worker first filed a petition to terminate Matthew S.'s parental rights on March 20,2002, pursuant to the child abuse section of the Children's Code, Wis. Stat. § 48.415(5)(a). This petition was dismissed on April 2, 2002, because Matthew S. still had appeals pending for his child abuse conviction.

       The four special verdict questions were as follows:
      1. Has [Joshua S.] been adjudged to be in need of protection or services and placed outside the home for a cumulative total period of six months or longer pursuant to one or more court orders containing the termination of parental rights notice required by law?
      2. Did the Sheboygan County Department of Social Services make a reasonable effort to provide the services to assist [Rachel B.] in meeting the conditions for the return of the child?
      3. Has [Rachel B.] failed to meet the conditions for the safe return of [Joshua S.] to her home?
      4. Is there a substantial likelihood that [Rachel B.] will not meet these conditions within the twelve-month period following the conclusion of this hearing?

       It should also be noted that the attorney for Matthew S. was directed at the March 27 hearing to make his motion for severance within the 45-day time limit. Judge Murphy stated: "We have 45 days to do this. Make your motion."

       Even if we agreed with Sheboygan County that the statute was properly tolled, the statutory time limit was still violated, and the court lost competency to proceed. Matthew S.'s motion for severance, if it tolled the statute, would have extended the time to hold the fact-finding hearing by 34 days, to June 13, 2003. Thirty-four days was the amount of time that elapsed between the filing of the motion on April 15, 2003, and the date of the motion hearing, May 19, 2003. Regardless, the record indicates that Rachel B.'s fact-finding hearing did not commence until October 15, 2003. This date falls well outside the 45-day time limit mandated by Wis. Stat. § 48.422(2).

       We do not decide whether the scheduling conflicts, noted on the record at later hearings, would have constituted good cause for a continuance. Such a determination distinguishes this case from State v. Quinsanna D., 2002 WI App 318, 259 Wis. 2d 429, 655 N.W.2d 752, and other cases where scheduling conflicts were discussed on the record, within the statutory time limit.
      We also recognize that on February 9, 2005, this court granted a petition for review in State v. Robert K., 2004AP2330 consolidated with 2004AP2331. That case similarly involved a competency challenge based on a violation of Wis. Stat. § 48.422(2). That case is somewhat different than the one at issue here.

       The original Children's Code encompassed a broad array of juvenile matters, including TPR petitions, adoptions, and delinquency petitions. However, "[i]n 1995, the legislature created chapter 938, the Juvenile Justice Code, which governs delinquent juveniles; CHIPS cases remain in chapter 48." State

        v. Michael S., 2005 WI 82, ¶ 57, 282 Wis. 2d 1, 698 N.W.2d 673 (interpreting time limits under Wis. Stat. § 938.315).

       While we acknowledge that the Mikrut court held that Wis. Stat. § 48.315(2m) was amended "to like effect" as Wis. Stat. § 938.315, we clarify now that the two statutes are not identical in effect. In § 938.315, the statute saves court competency for the failure to comply with any time limit specified in that entire chapter. In § 48.315(2), however, court competency is only saved for the failure to comply with any time limit specified in paragraph (a) of that statute, not the entire chapter.

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise indicated.


author: DAVID T. PROSSER, J. SHIRLEY S. ABRAHAMSON, C.J.

text:
    Raul J. Walters, d/b/a Lake Geneva Centre, Plaintiff-Respondent, v. National Properties, LLC, Defendant-Appellant-Petitioner, Horizon Properties, Inc., and Horizon Convenience Stores, Inc., Defendants.
    Supreme Court

      No. 2003AP862.

      Oral argument December 14, 2004.

      Decided June 23, 2005.

    2005 WI 87
    (Also reported in 699 N.W.2d 71.)

      For the defendant-appellant-petitioner there was a brief by Thomas B. Burke, Milwaukee, and oral argument by Thomas B. Burke.

    For the plaintiff-respondent there was a brief by Joseph M. Cardamone III and Gagliardi, OBrien, Braden, Olson & Capelli, Salem, and Martin B. Carroll and Fox, Hefter, Swibel, Levin & Carroll, LLP, Chicago, IL, and oral argument by Martin B. Carroll.

   DAVID T. PROSSER, J.

¶ 1. This is a review of a decision of the court of appeals, Walters v. National Properties, LLC, No. 2003AP862, unpublished slip op. (Wis. Ct. App. Jan. 21, 2004). In this small claims landlord-tenant dispute, we are asked to decide whether the landlord, Raul J. Walters (Walters), lawfully evicted his tenant, National Properties, LLC (National). National points to differences between the terms in its lease and the allegedly ambiguous and arguably more lenient terms in the default notice it received. National contends that because of these ambiguities and inconsistencies, it is entitled to rely on the default notice. We agree. However, even though we adopt National's ambiguity argument and permit it to rely on the default notice, National still did not timely cure its default. We therefore conclude that the eviction was lawful, and we affirm the court of appeals.

I. FACTS AND PROCEDURAL POSTURE

¶ 2. The facts are not in dispute. Walters, d/b/a Lake Geneva Shopping Centre, operates a shopping mall in Lake Geneva. On December 23, 1993, Walters entered a ten-year renewable lease agreement with Horizon Convenience Stores, Inc. (Horizon). The leased space consisted of a gasoline station and convenience store. On August 15,1997, Horizon assigned its interest in the lease to National. The lease requires National to pay a fixed rent in equal monthly installments, due on the first day of each month. Additionally, National must pay a variable amount based on its monthly and yearly sales. National must also pay property taxes. To allow Walters to verify the amount of variable rent due, the lease requires National to report its total monthly sales as part of each month's rent payment; National also must annually report its yearly sales. Two other paragraphs — ¶ 18 and ¶ 22 — in the lease are of particular importance to this case:

18. DEFAULT AND BANKRUPTCY. If LESSEE should default in the payment of any rental or monies due hereunder, when due, or be in default of any covenant, agreement or condition herein ... then upon the occurrence of any one or more of such contingencies and after the LESSEE has been given notice by certified mail of such default, LESSEE has thirty (30) days after the date of such notice to correct such default or defaults. If no such corrections are made, this lease is canceled and all rights of the LESSEE are terminated.
22. NOTICE. All notices to be given to either party by the other shall be by Certified or Registered Mail, return receipt requested, whether or not it is specifically designated as such in this lease agreement. ... The time of any such notice shall begin to run with the date of the mailing of such notice. (Emphasis added.)

¶ 3. National did not submit the rent payment due September 1, 2002. Consequently, Walters mailed a default notice on September 13, 2002. He sent the notice by certified mail, pursuant to the lease. The date "September 13, 2002" was typewritten on the notice. National received the notice on September 16, 2002. The notice alleged that National was in default in four ways: (1) Past due rent in the amount of $3421.42; (2) Failure to provide copies of all monthly sales receipts on a monthly basis; (3) Failure to provide annual sales information; and (4) Failure to pay real estate taxes for 2001. The notice also stated:

[UJnless such defaults are resolved on or before the expiration of thirty (30) days after service of this Notice, Landlord will exercise its remedies under the Lease, including... the right to terminate your right to possession of the premises.
Only FULL PAYMENT of the rent demanded in this Notice will waive the Landlord's right to terminate possession under this Notice, unless Landlord agrees in writing to continue possession in exchange for receiving partial payment. (Emphasis added.)

¶ 4. On October 15,2002, National mailed a check for the overdue rent to Walters. This payment covered only the non-variable portion of the rent. Walters received the payment on October 17, 2002.

¶ 5. Believing that National's response was untimely and incomplete, Walters attempted to evict National. On November 1, 2002, Walters filed suit in Walworth County Circuit Court seeking National's eviction for failure to timely cure the "fixed monthly rent" part of the default and failure to cure the other parts of the default, including the payment of the variable part of the rent and the submission of monthly and annual receipts. On March 14, 2003, the circuit court entered judgment for Walters, evicting National. Circuit Judge John R. Race held that the language in the lease controlled: "My decision is that the landlord by mailing had accomplished the notice requirements and he used the word service, a verb. And I believe that he complied with the lease by putting it in the mail." The court of appeals affirmed on the same grounds and we subsequently granted review.

II. ANALYSIS

¶ 6. When we apply undisputed facts to the terms of a commercial lease, and determine the parties' rights under that lease, we exercise de novo review. Westhaven Assoc., Ltd. v. C.C. of Madison, Inc., 2002 WI App 230, ¶ 16, 257 Wis. 2d 789, 652 N.W.2d 819; Bence v. Spinato, 196 Wis. 2d 398, 408, 538 N.W.2d 614 (Ct. App. 1995).

¶ 7. State statutes govern procedures for evicting a tenant who fails to pay rent or otherwise breaches the lease. Wisconsin Stat. § 704.17(3)(a) (2001-02) describes the default notice that a landlord must provide to a tenant holding a lease of duration longer than one year. However, the statute allows a lease for more than one year to contain contrary termination provisions that will override subsection (3). Wis. Stat. § 704.17(5). The lease at issue covered more than one year and included specific provisions on termination. Therefore, in this case, we review the lease provisions, not the statute.

¶ 8. This case is unusual because the language in the default notice is not precisely the same as the language in the lease. As a result, we must resolve the threshold question of whether the "date of service" provision in the notice supersedes the "date of mailing" provision in the lease, in determining when the thirty-day cure period begins, if we deem the two provisions inconsistent.

¶ 9. This question is further complicated by paragraph 18 of the lease. Paragraph 18 states that the tenant shall have thirty days "after the date of such notice," while paragraph 22 provides that the thirty-day period begins to run with the "date of the mailing of such notice." Both of these dates may be different from the "date of service" referenced in the default notice, depending upon the definition of "service."

¶ 10. National admits that under the lease, Walters could have demanded payment within thirty days from the date of mailing of the default notice. Clearly, the lease directs that the date of mailing of the notice, September 13, is effectively the beginning of the thirty-day cure period. National's strategy is different. It does not attack the lease provisions in any way; it argues that we should ignore the lease provisions because Walters worded his notice differently. The default notice stated on its face that National had to make payment before "the expiration of thirty (30) days after service of this Notice." (Emphasis added.)

¶ 11. For his part, Walters claims that the language in the notice, "thirty (30) days after service of this Notice," simply mirrors the language in the lease, "thirty (30) days after the date of such notice." As we see it, "notice" could be interpreted to mean the same thing as "service," an interpretation favorable to the tenant. It is more difficult to interpret "mailing" to mean the same thing as "service," an interpretation desired by the landlord. With perfect hindsight, we observe that if the landlord wanted his notice to accurately mirror his lease, he should have used identical language in the two documents. That would have produced clarity and ensured the unquestioned primacy of the lease. Here, Walters did not copy the lease language in the notice; instead, he chose alternative wording.

¶ 12. We conclude that Walters' choice of alternative wording rendered the notice ambiguous. A reasonable tenant evaluating his options might have perceived the following: (1) Paragraph 18 of the lease states that the lessee has thirty days after "the date of such notice;" (2) Paragraph 22 of the lease states that the lessee has thirty days from "the date of the mailing of such notice;" (3) the notice states that the lessee must resolve the defaults within "thirty days after service of this Notice;" (4) both the lease and the notice are silent on the definition of "service." There is no way for the lessee to determine what "service" means without reference to extraneous sources.

¶ 13. In situations like these, this court has traditionally adhered to the deeply rooted doctrine of contra proferentem, a universally accepted legal maxim that any ambiguities in a document are to be construed unfavorably to the drafter. Black's Law Dictionary 328 (7th ed. 1999). Since this court's earliest days, we have recognized its validity. See, e.g., Lawe v. Hyde, 39 Wis. 345, 359 (1876). Although the rule is most often used to interpret the terms of a contract, see, e.g., Seitzinger v. Community Health Network, 2004 WI 28, ¶ 22, 270 Wis. 2d 1, 676 N.W.2d 426, it has also been applied to documents such as settlement offers, Pachowitz v. LeDoux, 2003 WI App 120, ¶ 39, 265 Wis. 2d 631, 666 N.W.2d 88; Stan's Lumber, Inc. v. Fleming, 196 Wis. 2d 554, 576, 538 N.W.2d 849 (Ct. App. 1995), and exculpatory clauses, Merten v. Nathan, 108 Wis. 2d 205, 210-11, 321 N.W.2d 173 (1982). We see no reason why it should not also apply to the ancillary notice of eviction that Walters drafted pursuant to the termination procedure spelled out in the lease contract.

¶ 14. Under this canon of interpretation, courts construe ambiguous language "most strongly" against the drafter. Moran v. Shern, 60 Wis. 2d 39, 49, 208 N.W.2d 348 (1973); accord Dieter v. Chrysler Corp., 2000 WI 45, ¶ 15, 234 Wis. 2d 670, 610 N.W.2d 832. The rule is often applied to "aid a party whose bargaining power was less than that of the draftsperson." 5 Corbin, Corbin on Contracts § 24.27, at 292 (Kniffen & Perillo ed. 1998). The Restatement of Contracts contains a similar provision: "In choosing among the reasonable meanings of a promise or agreement or a term thereof, that meaning is generally preferred which operates against the party who supplies the words or from whom a writing otherwise proceeds." Restatement (Second) of Contracts § 206 (1979). The comments to Section 206 explain that the drafting party is more likely to perceive areas of ambiguity, or even to intentionally create ambiguity, intending to put forth a particular interpretation at a later date. Id., cmt. a.

¶ 15. Using these principles, we note that Walters drafted both the lease and the notice. He had every opportunity to ensure clarity by employing consistency, both internally within the lease and between the lease and the notice. He did not. Walters urges that the notice's language, "service of this notice," is functionally equivalent to the lease term, "the date of such notice," and therefore the mailing date still marks the beginning of the thirty-day time period. We reject this argument because, applying the rule that ambiguity is construed against the drafter, we cannot allow Walters to mechanically equate the lease language with the default notice language. Rather, we must analyze what the language in the notice required of National in order to cure its default.

¶ 16. National relies on Hotel Hay Corp. v. Milner Hotels, Inc., 255 Wis. 482, 39 N.W.2d 363 (1949), and Boeck v. State Highway Commission, 36 Wis. 2d 440, 153 N.W.2d 610 (1967), to support its argument that the notice is not effective until the date of service. In Hotel Hay, this court held that, absent anything to the contrary in the lease, a default notice became effective at the time of delivery. The court stated:

The nature of notice required by contract depends, of course, upon the provisions of the contract.... In the absence of custom, statute, estoppel, or express contract stipulation, when a notice, affecting a right, is sought to be served by mail, the service is not effected until the notice comes into the hands of the one to be served, and he acquires knowledge of its contents.

Hotel Hay, 255 Wis. at 486 (emphasis added) (internal citations omitted).

¶ 17. In Boeck, the court reiterated the Hotel Hay rule that in the absence of more specific provision in a statute or a contract, a notice does not become effective until it is served on a party. Boeck, 36 Wis. 2d at 444. In Boeck, though, a statutory provision clearly governed service of the notice at issue. Id. Hence, far from making any sort of statement that the date of service of the notice always governs, the court in that case relied upon a statute.

¶ 18. If the terms of the lease are to control, superseding Wis. Stat. § 704.17(3)(a), the principles in the Hotel Hay case, and any other document, they must be clear and consistent internally and not be undermined by a subsequent Lessor-drafted document.

¶ 19. In this case, we need not decide whether the notice is functionally equivalent to the lease. There is sufficient ambiguity in the two documents that National is entitled to rely on the notice, interpreted to require receipt. This is a hollow victory, however, because National did not comply with the notice either.

¶ 20. Walters mailed the default notice on September 13. National received it on September 16. National mailed its response, including a check to cure the monetary part of the default, on October 15. Walters received the response on October 17. Therefore, while 32 days elapsed between the two mailing dates, 31 days elapsed between the two dates of receipt.

¶ 21. The only way National can prevail is if we measure the time period between National's receipt of the notice on September 16 and the mailing date of its response on October 15 (29 days). We decline to accept such a convoluted combination of the notice and the lease. National cannot have it both ways; either the dates of receipt control, or the dates of mailing control. National wants to hold Walters to one standard (the date of receipt, as expressed in the default notice) while it obeys another (the date of mailing, as expressed in the lease). As we have noted, under the doctrine of contra proferentem, the language in the notice must be interpreted favorably to National. But the doctrine has its limits. While the doctrine allows us to construe the ambiguity in National's favor, so that it can rely on the notice, the doctrine does not allow us to completely ignore language within the notice. It would be fundamentally unfair to allow National to rely on some provisions in the notice while effectively deleting others.

¶ 22. The notice states that "such defaults" (presumably, the four defaults mentioned in the notice) must be "resolved" within thirty days. By mailing the past due rent, National attempted to cure only one of the four parts of its default. It also did not cure timely its failure to provide monthly or annual sales figures, or its failure to pay property taxes. It was in default long past thirty days, and we cannot say that it "resolved" all the defaults. Accordingly, Walters was entitled to eviction of National.

III. CONCLUSION

¶ 23. We conclude that because of the ambiguous nature of the default notice and the lease, National had the right to rely on the terms in the default notice. In general, landlords should be held to the language in the notices they send. We have no doubt that ordinarily, landlords will fully exercise their rights under the lease — indeed, the wisest course would be to copy the lease language in the notice, and we have been presented with no explanation why the landlord did not do that here. In any event, National did not comply with the default notice's terms, and accordingly Walters lawfully evicted it. We therefore affirm the decision of the court of appeals.

By the Court. — The decision of the court of appeals is affirmed.

SHIRLEY S. ABRAHAMSON, C.J.

¶ 24. (dissenting). I agree with the majority opinion on several issues:

1. Both the default notice and the lease in the instant case are ambiguous about curing a default, whether the documents are read independently or together.
2. When provisions in a default notice differ from those in a lease, the terms of the default notice control if the terms of the default notice are more favorable to the tenant. Accordingly, the default notice provision controls as to the calculation of the 30-day period in the instant case.
3. The general interpretive rule applicable to ambiguous documents is to construe them against the drafter. The Landlord drafted the lease and default notice in the instant case; therefore, those documents are construed against the Landlord.

¶ 25. I disagree with the majority opinion's ultimate conclusion because it is inconsistent with this applicable interpretive rule.

¶ 26. The default notice — the governing instrument here — provides that "unless [the specified] defaults are resolved on or before the expiration of thirty (30) days after service of this Notice, Landlord will exercise its remedies ... including... the right to terminate [the Tenant's] right to possession." The Landlord is exercising its right to terminate the Tenant's possession under the default notice.

¶ 27. The Landlord mailed the default notice (dated September 13, 2002) by certified mail on September 13, 2002. The Tenant received the notice on September 16, 2002.

¶ 28. What is the date of "service" of the notice? September 13 or September 16? The calculation of the date of "service" of the notice is not set forth in the default notice or the lease. Apparently relying on the Hotel Hay case (which is factually distinguishable), but without fully explaining its interpretation, the majority opinion interprets the date of "service" of the notice as the date the Tenant received the notice.

¶ 29. Applying the governing interpretive rule, I would interpret the default notice against the Landlord, the drafter, and would conclude that service of the notice starting the 30-day period means the date the Tenant received the notice. By using this date the Tenant will have more time to cure the default than if service of the notice were interpreted as the date of mailing.

¶ 30. I now turn to calculating the date by which the Tenant must "resolveü" the default under the default notice. Although it is clear that the Tenant may resolve the default by paying the rent, the notice is silent about calculating the date rent was paid for purposes of calculating the end of the 30-day period. Must the Tenant personally hand over the money to the Landlord within the 30-day period after receipt of the default notice? Or may the Tenant merely place the payment in the mail properly addressed to the Landlord within the 30-day period? Or, if the Tenant mails the payment, must the Landlord actually receive the mailing within the 30-day period?

¶ 31. The majority opinion concludes that because it defines service of the notice as the date the Tenant receives the notice, it must define the date of resolution of the default as the date the Landlord receives the rent payment. "Why so?" I ask. Because, responds the majority, the date of receipt of service is derived from the default notice, while the date of mailing of payment is derived from the lease. The majority will not allow the Tenant to "have it both ways," to have a "convoluted combination of the notice and the lease," that is, the Tenant cannot mix and match provisions from the notice and the lease.

¶ 32. Assuming for the sake of argument that the majority opinion's principle against mixing and matching is sound, the principle has no application to the instant case. The Tenant's practice has been to mail the rent payment to the Landlord. The lease provides that the rent is due on the first of the month but that interest will not begin to accrue unless the Landlord receives the payment after the seventh of the month. These provisions simply do not specify whether mailing or receipt of payment was to occur by the first of the month. Therefore, the lease itself refutes the majority opinion's conclusion that the Tenant's definition of "payment" derives from the lease.

¶ 33. The majority opinion goes on to state that the Tenant's interpretation would require the court to "completely ignore language within the notice" and would allow the Tenant "to rely on some provisions in the notice while effectively deleting others." Yet the majority fails to cite any such provisions. Thus, the majority opinion implies that the default notice provides that the Landlord must receive the payment of rent by the end of the 30-day period.

¶ 34. The majority opinion adopts the arbitrary rule that "either the dates of receipt control, or the dates of mailing control." The majority opinion ultimately justifies this rule by claiming that any other interpretation of the time period would be "fundamentally unfair," but it fails to identify any fundamental unfairness. Furthermore, the majority opinion does not clarify whether its rule of construction applies in all cases or only in the instant case.

¶ 35. Faced with two ambiguous documents, I would in the instant case interpret the 30-day period examining only the default notice, which sets forth the 30-day period. Given that the default notice is unclear as to both the date of service and the date of payment, I would adhere to the rule that an ambiguous document should be interpreted against the drafter. Accordingly, I would give the Tenant the advantage in calculating both the date of service and the date of payment. I would say that the service of the notice is the date of receipt by the Tenant and that the date of payment of the rent is the date the Tenant mails the payment.

¶ 36. Unlike in many eviction actions, in the instant case the parties were represented by counsel. A typical tenant facing eviction and a typical landlord seeking eviction often appear in a busy small claims court without representation. Because of the press of business, the court usually has a very limited time in which to make a decision and does not have the benefit of written or oral argument by counsel or the parties.

¶ 37. The majority opinion today passes up an opportunity to provide guidance to circuit courts in eviction cases. The majority opinion states the interpretive rule correctly but inexplicably never applies it either in defining the date of service on the Tenant or in defining the Tenant's date of payment to the Landlord. I would have had this court state that in an eviction action in which both the lease and the default notice were drafted by the landlord and are ambiguous, the tenant is entitled to rely on the interpretation of the document most favorable to the tenant.

¶ 38. For the reasons set forth, I respectfully dissent.

       All subsequent references to the Wisconsin statutes are to the 2001-02 edition unless otherwise indicated.

       In some cases, equitable estoppel might bar a landlord in Walters position from subsequently relying on the lease provisions.
      Three elements are required to support application of equitable estoppel: (1) an action or inaction; (2) that induces reliance by another; (3) to his detriment. Randy A.J. v. Norma I.J., 2004 WI 41, ¶ 26, 270 Wis. 2d 384, 677 N.W.2d 630. Equitable estoppel is not limited to claims brought in equity; it may also apply to "preclude the assertion of rights and liabilities under a note or contract." Gabriel v. Gabriel, 57 Wis. 2d 424, 428, 204 N.W.2d 494 (1973) (citing 31 C.J.S. Estoppel § 151).
      National does not argue that it relied on the notice to its detriment. In fact, it does not invoke the doctrine of equitable estoppel at all. Thus, we disregard the theory. We note, however, that even if we had considered it, the result in this case would be the same. Equitable estoppel would allow National to rely on the language of the default notice, but it failed to comply with the terms of the notice.

       For example, a tenant familiar with the legal system might refer to Wis. Stat. § 801.14, which governs "Service and filing of pleadings and other papers," or even Wis. Stat. § 801.11, "Personal jurisdiction, manner of serving summons for."

       For a recent discussion, see State Farm Mutual Automobile Insurance Co. v. Langridge, 2004 WI 113, ¶ 44, 275 Wis. 2d 35, 683 N.W.2d 75.

       National argues that later in the notice, Walters stated that "[o]nly FULL PAYMENT of the rent demanded in this Notice will waive the Landlord's right to terminate possession under this Notice." National argues that we should interpret this clause to mean that it only had to cure one of the four defaults — namely, the fixed rent. It fails to realize, however, that it may have had to pay additional "rent" based on its monthly or annual sales receipts, and it did not submit those in a timely manner. Therefore, without submitting the receipts as required, it cannot show that it submitted the "rent" necessary to cure its default. Moreover, looking at the entire provision, we think National is attempting to take the "FULL PAYMENT" clause out of context.

       Majority op., ¶ 8. The lease does not use the word "service"; it addresses the date of the notice (apparently September 13 here) and the date of the mailing of the notice (apparently September 13 here) as beginning the 30-day cure period.

        Hotel Hay Corp. v. Milner Hotels, Inc., 255 Wis. 482, 486-87, 39 N.W.2d 363 (1949) (relying on the terms of the lease and Corpus Juris for the principle that service of a notice is not effected until receipt).

       Majority op., ¶ 21.

        Id.

         Id.

       The Tenant does argue that the language of the lease implies that rent is paid upon mailing to support its argument that the language of the notice implies the same. I do not rely on this argument.

       Paragraph 3 of the lease provides, "LESSEE agrees and covenants to pay LESSOR ... an annual fixed rent... payable in advance in equal monthly installments on the first day of each and every calendar month during the term of this Lease and any extension thereof. If any payment of rent is not received by the seventh (7th) day of the month in which it is due and LESSOR notifies LESSEE of the same, it is agreed that a one and one half percent (1.5%) penalty per month shall he due LESSOR."

       Majority op., ¶ 21.

         Id.

         Id.

       Another issue is not sufficiently addressed in the briefs or the majority opinion, see majority op., ¶ 22, namely whether the Tenant loses anyway because it did not timely cure the non-monetary defaults specified in the notice. I therefore do not address that issue.