author: LUNDSTEN, J.

text:
    Saint Joseph's Hospital of Marshfield, Inc., Plaintiff-Appellant, v. City of Marshfield, Defendant-Respondent.

    Court of Appeals

      No. 03-1006.

      Oral argument November 24, 2003.

    Decided September 2, 2004.

    2004 WI App 187
    (Also reported in 688 N.W.2d 658.)

      On behalf of the plaintiff-appellant, the cause was submitted on the briefs of David J. Edquist and Susan E. Lovern of von Briesen & Roper, S.C., Milwaukee. There was oral argument by David J. Edquist.

      On behalf of the defendant-respondent, the cause was submitted on the brief of and oral argument by John Hutchinson of Stauber, Juncer, Wolfgram & Gamoke, S.C., Marshfield.
    Before Vergeront, Lundsten and Higginbotham, JJ.

       Petition to review denied 11-18-2004.

   LUNDSTEN, J.

¶ 1. This case involves a property tax exemption dispute between the City of Marshfield and St. Joseph's Hospital. The Hospital owns a child care facility used primarily by Hospital employees and employees of Marshfield Clinic. The City denied the Hospital's request for property tax-exempt status for the child care center. The Hospital sought judicial review, and the circuit court granted summary judgment in favor of the City. The Hospital appeals. We reverse the circuit court and remand for further proceedings.

Background

¶ 2. St. Joseph's Hospital is a non-profit corporation. The buildings in which the Hospital operates as a hospital are property tax exempt under Wis. Stat. § 70.11(4m)(a) (2001-02).

¶ 3. The Hospital is closely associated with Marshfield Clinic. The Clinic is a non-profit organization adjacent to and physically connected to the Hospital. The Clinic property is treated by the City as property tax exempt under Wis. Stat. § 70.11(25) as a nonprofit medical research foundation. With two exceptions, the physician staff of the Hospital is comprised of Marshfield Clinic physicians. At least some other Clinic employees directly or indirectly serve Hospital patients.

¶ 4. The Hospital and Marshfield Clinic separately provided in-building child care facilities to their employees prior to 1999. In 1999, the Hospital constructed a stand-alone building to house its child care center. The disputed child care center property is located adjacent to and near some Hospital and Clinic employee parking, a couple of blocks from the Hospital and Clinic buildings.

¶ 5. The child care center is available to Marsh-field Clinic employees through an agreement between the Hospital and the Clinic. Space allocation in the child care center includes the following: 49% for the children of Hospital employees and 49% for the children of Marshfield Clinic employees. Marshfield Clinic contributed 49% of the construction cost of the child care center and contributes 49% to the amount needed to supplement the center's yearly operating budget.

¶ 6. The Hospital employs a private company, Bright Horizons, to operate the child care center. Five percent of the spaces in the child care center are reserved for the children of Bright Horizons employees who work at the center.

¶ 7. In 1999, the Hospital asked the City to declare the child care center fully property tax exempt. The City denied the request and classified the center as 98% taxable. For tax years 2000 and 2001, the City of Marshfield assessed the Hospital property tax on 98% of the value of the Hospital's child care center property. The Hospital paid the tax bills, but contested them. The City denied the Hospital's claim for recovery. The Hospital challenged the assessment in circuit court pursuant to Wis. Stat. § 74.35(3)(d).

¶ 8. The Hospital and the City submitted affidavits and a stipulation of facts. Both parties moved for summary judgment. The circuit court denied the Hospital's motion and granted summary judgment in favor of the City. The court concluded that the Hospital's child care center property was 98% taxable. The circuit court reasoned that the Hospital had the burden of demonstrating that it was providing a benefit to employees not available from other nearby child care facilities. The court concluded that the Hospital's child care center is "not 'reasonably necessary' since the same services are already available in the community [within] a reasonable proximity of the Hospital."

Discussion

¶ 9. In the context of summary judgment, the circuit court concluded that the disputed portion of the Hospital's child care center was not entitled to tax-exempt status under Wis. Stat. § 70.11(4m)(a) for tax years 2000 and 2001. We review summary judgment de novo, applying the same standard as the circuit court. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315, 401 N.W.2d 816 (1987). A party is entitled to summary judgment if there is no genuine issue as to any material fact and that party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2). When deciding whether there are genuine issues of material fact, we view the evidence, and the reasonable inferences from that evidence, most favorably to the opposing party. Kraemer Bros., Inc. v. United States Fire Ins. Co., 89 Wis. 2d 555, 566-67, 278 N.W.2d 857 (1979).

¶ 10. We recently addressed property tax exemptions in University of Wisconsin Medical Foundation, Inc. v. City of Madison, 2003 WI App 204, 267 Wis. 2d 504, 671 N.W.2d 292, review denied, 2004 WI 20, 269 Wis. 2d 198, 675 N.W.2d 804 (Jan. 23, 2004) (No. 02-1473). We explained:

Under Wisconsin law, real and personal property are presumptively taxable. Certain property, however, is exempted from tax by statute. Because tax exemption statutes "are matters of legislative grace," they are to be "strictly construed in every instance with a presumption that the property in question is taxable, and the burden of proof is on the person who claims the exemption."

UW Medical Foundation, 267 Wis. 2d 504, ¶ 10 (citations omitted); see also Village of Lannon v. Wood-Land Contractors, Inc., 2003 WI 150, ¶ 14, 267 Wis. 2d 158, 672 N.W.2d 275.

¶ 11. The question here is whether a non-profit hospital's child care facility is exempt from property tax under Wis. Stat. § 70.11(4m)(a). Our interpretation of this statute "must take into account its clear legislative purpose, namely, to provide a benefit to nonprofit hospitals engaged in the care of the sick." Sisters of St. Mary v. City of Madison, 89 Wis. 2d 372, 380, 278 N.W.2d 814 (1979). Section 70.11(4m)(a) reads, in pertinent part:

Nonprofit hospitals, (a) Real property owned and used and personal property used exclusively for the purposes of any hospital of 10 beds or more devoted primarily to the diagnosis, treatment or care of the sick, injured, or disabled ... .

Thus, the question here is whether all or part of the disputed 98% of the Hospital's child care center is "used exclusively" for purposes of the Hospital within the meaning of § 70.11(4m)(a).

¶ 12. The statutory phrase "used exclusively" was construed in Columbia Hospital Ass'n v. City of Milwaukee, 35 Wis. 2d 660, 151 N.W.2d 750 (1967). In Columbia Hospital, the supreme court adopted the "reasonably necessary" test as a framework for analyzing whether property is "used exclusively" within the meaning of the statute. Under the "reasonably necessary" test, property need not be indispensable to the efficient functioning of a hospital. Id. at 670-71.

The section has carefully expressed the exemption in terms of a hospital whose primary purpose is diagnosis, treatment and care and this contemplates that a hospital may have other functions and objects, whether they be directly or indirectly associated with the care of the sick. The language of the section refers to property used exclusively for the purposes of the hospital. This means any and all purposes, not just for the primary purpose of care, diagnosis or treatment.

Id. at 668 (emphasis added). Moreover, the facility need not solely benefit the hospital:

Under this doctrine, even though there is some incidental benefit to the occupants of residential properties, such benefit does not require that the property be nonexempt when the providing of such housing is for the greater benefit of the hospital.

Id. at 671. Rather, courts are to assess whether the property and its use are a " 'reasonable necessity to the efficient functioning of the hospital as an organization.' " Id. at 670-71 (relying on Cedars of Lebanon Hosp. v. Los Angeles County, 221 P.2d 31 (Cal. 1950)).

¶ 13. In St. Elizabeth Hospital, Inc. v. City of Appleton, 141 Wis. 2d 787, 416 N.W.2d 620 (Ct. App. 1987), we provided additional guidance:

[T]he language of the statute referring to property used exclusively for the purpose of the hospital means "any and all purposes." Furthermore, it is for the hospital management, not the reviewing court, to determine the purpose of the hospital. Whether the means are reasonably necessary to attain those purposes is the question open to our determination.

Id. at 792 (citation omitted).

¶ 14. We glean from these authorities the following standard: to qualify as property tax exempt under Wis. Stat. § 70.11(4m)(a), the use of the property in question must be reasonably necessary to the efficient functioning of the hospital as an organization in light of the hospital's tax-exempt purposes, namely, the diagnosis, treatment, and care of patients.

Whether the "Reasonably Necessary" Test Includes Consideration of Alternatives

¶ 15. The Hospital and the City dispute whether analysis under Wis. Stat. § 70.11(4m)(a) should include a comparison of the Hospital's child care center with alternative nearby child care facilities. The City states: "The single issue is whether the Hospital's decision to operate its own custodial day care facility— even though equivalent facilities are fully available in Marshfield — is reasonably necessary to further the specific purpose of delivering health care services." Indeed, much of the argument by both the Hospital and the City in the circuit court and before this court focuses on whether the Hospital's child care center provides advantages to Hospital and Clinic employees — and by extension to the Hospital itself — not available at other child care centers near the Hospital and Clinic.

¶ 16. An inquiry into alternatives seems intuitively correct. After all, what need is there to grant tax-exempt status to a facility that simply competes with taxpaying facilities and provides no added benefit to the Hospital functions that underpin its tax-exempt status? Thus, it is difficult to fault the parties and the circuit court for focusing attention on comparisons with alternative child care facilities. However, our review of the two supreme court cases on this topic persuades us that a hospital seeking tax-exempt status for property under Wis. Stat. § 70.11 (4m) (a) has the burden of showing a benefit to the functioning of the hospital, but no burden of showing that the benefit is not otherwise available.

¶ 17. The seminal case on this topic is Columbia Hospital. In Columbia Hospital, the supreme court reviewed several residential properties owned by a hospital and occupied by various hospital employees at low rental rates. The occupying employees included the director of building services, the director of nurses, an electronic technician, interns, and resident doctors. Columbia Hospital, 35 Wis. 2d at 664, 665-66. With respect to the residences of each of these employees, the supreme court concluded that the property's use was "reasonably necessary" to the functioning of a large modern hospital and, therefore, the property was tax exempt under Wis. Stat. § 70.11(4m). Columbia Hospital, 35 Wis. 2d at 672-74.

¶ 18. Pertinent to our "alternatives" issue, the supreme court in Columbia Hospital did not address what would happen if the hospital did not provide housing to its employees. That is, the court did not engage in the sort of "alternatives" analysis that the City of Marshfield argues is required in this case. For example, the Columbia Hospital court concluded that the hospital benefited by having its director of nursing live in a residence near the hospital because she was responsible for all nursing activities and she was frequently called to the hospital during her off-duty hours. Id. at 666, 673. The court did not, however, address whether other affordable housing was available near the hospital. Under the analysis promoted by the City here, the absence of information in Columbia Hospital about alternatives should have been fatal to the hospital's quest for property tax-exempt status for the residence occupied by the director of nursing. Obviously, it was not.

¶ 19. Before this court, the City does not develop the legal basis for its "alternatives" argument. However, before the circuit court the City relied on the following language from Columbia Hospital:

Providing convenient and inexpensive housing is an important part of the recruitment of interns and residents, who have difficulty finding suitable living quarters because generally theirs is a short-time need and they are not "on the spot" to view the living facilities.

Id. at 673 (emphasis added). Viewed in isolation, the statement that interns and residents "have difficulty finding suitable living quarters" might suggest that the Columbia Hospital court reviewed evidence of alternative living arrangements for interns and residents. But nothing in Columbia Hospital suggests there was evidence or fact finding as to what would have occurred if the hospital did not provide low cost housing to interns and residents; that is, there is no indication whether other suitable, convenient, and inexpensive housing was available. Instead, the benefits analysis used in Columbia Hospital only involves a review of evidence indicating that the hospital benefited in various ways from having some employees live in housing owned and controlled by the hospital.

¶ 20. Similarly, in Sisters of St. Mary, 89 Wis. 2d 372, the supreme court concluded, without discussing alternatives, that a hospital-owned residence, located near the hospital and occupied by the hospital's chaplain, qualified for an exemption under Wis. Stat. § 70.11(4m). Sisters of St. Mary, 89 Wis. 2d at 382-84. The supreme court concluded that the Chaplain's residence qualified for tax-exempt status because it was reasonably necessary for the hospital to have a chaplain located near the hospital to "perform emergency religious services for patients." Id. at 383. The court explained that the "social, emotional and spiritual dimensions of patient care are indeed important to the patient's well-being" and "[cjaring for these nonphysical needs of patients is a legitimate purpose of a modern hospital." Id. Nowhere did the Sisters of St. Mary court discuss what would happen if the hospital did not provide a residence for its chaplain. Was comparable alternative housing available nearby? Would the Chaplain's religious organization provide a home nearby? Did the hospital pay the Chaplain a sufficient salary to pay for his own home nearby? There is no indication in Sisters of St. Mary that such questions were asked. Here again, the supreme court did not engage in the type of "alternatives" analysis advanced by the City in this case.

¶ 21. Finally, we observe that in Columbia Hospital the supreme court cited with approval several cases from other jurisdictions where courts, without any dis-mission of alternatives, addressed whether hospital property was tax exempt.

¶ 22. The lack of a discussion of alternatives in Columbia Hospital and Sisters of St. Mary leads us to conclude that our supreme court has determined that when a hospital seeks tax-exempt status for a property under Wis. Stat. § 70.11(4m)(a), the hospital does not have the burden of showing what would happen if the hospital did not use its property to provide the benefit in question. We construe the case law in this area as being more favorable to the potential taxpayer, that is, non-profit hospitals, than it is with respect to other exemptions. In Columbia Hospital, the supreme court explained: "Sec. 70.11(4m) was created in 1957 solely to apply to hospitals and its language is much broader than that used in the older exemption statutes applicable to charitable and benevolent institutions." Columbia Hospital, 35 Wis. 2d at 669. Similarly, our discussion in UW Medical Foundation indicates that the "reasonably necessary" test is both more favorable and unique to § 70.11 (4m)(a). In UW Medical Foundation, the Foundation, which was seeking tax-exempt status under different subsections of § 70.11, sought the advantage of the favorable "reasonably necessary" test of subsection (4m), but we held that this test has "no relevance to subsections other than (4m)." UW Medical Foundation, 267 Wis. 2d 504, ¶ 17.

¶ 23. Having concluded that evidence of services provided by alternative child care facilities is not relevant to our analysis under the "reasonably necessary" test, we turn our attention to whether, regardless of other facilities, the disputed 98% of the child care center is reasonably necessary to the efficient functioning of the Hospital.

Whether the Child Care Center is "Reasonably Necessary" to the Hospital

¶ 24. The Hospital has the burden of establishing that its child care center is entitled to a property tax exemption. See Deutsches Land, Inc. v. City of Glendale, 225 Wis. 2d 70, 80, 591 N.W.2d 583 (1999) ("[T]he party seeking the exemption bears the burden of proving that it falls within a statutory exemption."). Thus, the Hospital is entitled to summary judgment only if, based on the undisputed facts, it is entitled to the property tax exemption it seeks for its child care center.

¶ 25. The Hospital's principal purposes and primary activities are the diagnosis, treatment, and care of the sick, injured, or disabled. Under the "reasonably necessary" test used to determine whether hospital property is tax exempt under Wis. Stat. § 70.11(4m)(a), the question here is whether the child care center is reasonably necessary to the efficient functioning of the hospital as an organization in light of these purposes and activities. See Columbia Hospital, 35 Wis. 2d at 670-71.

¶ 26. The parties address the property tax exemption issue by distinguishing three groups served by the child care center: Hospital employees, Marshfield Clinic employees, and the employees of the company hired by the Hospital to run the center, that is, Bright Horizons employees. We agree that these three groups merit separate attention, and address them below.

¶ 27. We pause here to comment on two assumptions the parties make, but do not discuss, relating to partial exemptions: (1) the propriety of a partial exemption for the Hospital property, and (2) the method used to calculate that partial exemption under various scenarios.

¶ 28. First, the parties assume that the Hospital is eligible for a partial exemption for some portion of the child care center, if only a portion is attributable to a use that is tax exempt under Wis. Stat. § 70.11(4m)(a). However, the only authority discussed by the parties for a partial exemption is Wis. Stat. § 70.1105, and their discussion of that statute is cursory. Neither party suggests that § 70.1105 has direct application to the facts in this case. More importantly, neither party provides a developed argument as to why a partial exemption is permitted. In the absence of developed argument, we will assume, without deciding, that a partial exemption is appropriate under § 70.11 (4m)(a) when only a portion of the use of a hospital's property is attributable to a use that qualifies under that statute.

¶ 29. Second, the parties apparently assume that the proper method for allocating the percentages of the property which are taxable and tax exempt directly correlate to the percentages of children in the three groups: children of Hospital employees, children of Marshfield Clinic employees, and children of Bright Horizons employees. That is, the parties assume that if 49% of the full-time equivalent slots at the center are filled with the children of Hospital employees, then 49% of the property is either taxable or tax exempt, depending on whether we conclude that use by such children benefits the Hospital within the meaning of Wis. Stat. § 70.11(4m)(a). However, the validity of this allocation method is not apparent. For example, suppose it is ultimately determined that 10% of the spaces are filled by children of Clinic employees who do not benefit the Hospital within the meaning of § 70.11 (4m)(a). Does that mean that a full 10% of the value of the facility is taxable? Would the facility be 10% smaller or 10% less valuable if it had been constructed to serve 10% fewer children? In the absence of briefing on the topic, we assume, but do not decide, that the percentages of children correlate directly to the percentages of the child care center property that is taxable or tax exempt.

¶ 30. Having clarified that these are undisputed assumptions, not holdings of this court, we turn to the three groups of employees discussed by the parties.

1. Hospital Employees

¶ 31. Our review of the parties' arguments discloses that the dispute between the Hospital and the City with respect to Hospital employees focuses on comparisons between the Hospital's child care center and nearby alternative facilities. The City contends that the benefits to the Hospital are insufficient under the "reasonably necessary" test because the same benefits would flow from "equivalent day care facilities located near the Hospital." However, as explained above, the proper analysis does not involve comparing the Hospital's child care center to other nearby facilities available to Hospital employees. Rather, we consider whether the child care center is reasonably necessary to the efficient functioning of the Hospital as an organization without comparing the child care center with alternative nearby facilities.

¶ 32. We conclude, in light of undisputed facts, that the benefit to the Hospital is sufficient under the "reasonably necessary" test. In Columbia Hospital and Sisters of St. Mary, the hospitals benefited by having staff residences located near the hospitals, thereby facilitating the service those employees provided to the hospitals. In Columbia Hospital, the hospital used housing for resident doctors as a recruiting tool. Similarly, the child care center in this case enhances both employee performance and the ability of the Hospital to attract quality personnel. Our review of the record reveals the following undisputed evidence:

• The Hospital's child care center is located near Hospital and Clinic employee parking and is located across a main thoroughfare from the Hospital complex. A map in the record shows that the child care center is at most a few minutes walk from the Hospital and Clinic.
• The Hospital child care center is licensed and equipped to provide "sick child" care, thereby reducing employee absenteeism.
• Having a hospital-owned-and-operated child care center is used by the Hospital as a recruiting tool. The child care center is featured in Hospital recruiting materials. Approximately 60% of similarly sized hospitals offer some form of child care to employees. Several employees have told Hospital administrators that the child care center contributed to their decision to accept employment at the Hospital. The child care center has a waiting list of Hospital and Clinic employees.
• The child care center is open from 5:45 a.m. to 9:00 p.m. weekdays, a time period Hospital officials have determined meets the needs of most Hospital employees and accommodates certain employees with twelve-hour or rotating shifts.
• The child care center accommodates children from the age of 6 weeks to 13 years.
• The Hospital's child care center accommodates last-minute schedule changes. The Hospital, as owner of the child care center, has the ability to change the procedures and hours of operation to meet any changing needs of Hospital employees.
• According to a Hospital administrator, the child care center, with its features such as location, flexible scheduling, and "sick child" care, reduces employee absenteeism and tardiness.

¶ 33. The City does not explain why these features of the child care center do not benefit the functioning of the Hospital. Instead, the City complains that the Hospital has failed to "specifically demonstrate . . . how the use of the Day Care Center by. .. specific employees . . . furthers the Hospital's ability to provide health care services." But this employee-by-employee argument lacks merit. First, the majority of Hospital employees using the child care center, such as nurses and therapists, are directly involved in providing patient care. Moreover, Hospital "support" personnel— such as cooks, computer technicians, and laundry workers — obviously add to the efficient functioning of the Hospital. It follows that convenient child care that reduces tardiness and absenteeism in this group also benefits the efficient functioning of the Hospital as an organization.

¶ 34. Accordingly, we reverse the circuit court's grant of summary judgment with respect to that portion of the Hospital's child care center property attributable to Hospital employee use. With respect to this group, we direct entry of summary judgment in favor of the Hospital, as further explained below.

2. Marshfield Clinic Employees

¶ 35. Perhaps because the parties focused their attention on comparisons between the Hospital's child care center and alternative facilities, scant briefing was devoted to Marshfield Clinic employees as a distinct group of child care center users. The City asserts, and the Hospital implicitly concedes, that a property tax exemption for the portion of the center attributable to Clinic employee use must be justified based on whether the Clinic employees contribute to the efficient functioning of the Hospital as an organization. We agree. Although cumbersome, if the partial exemption approach assumed by the parties is permissible, then case law interpreting Wis. Stat. § 70.11(4m)(a) clearly directs that the use of the portion of the property in question must satisfy the "reasonably necessary" test. See Columbia Hospital, 35 Wis. 2d at 670-71. If, for example, none of the Clinic employees using the child care center contribute to the functioning of the Hospital, then there is no reason to extend property tax-exempt status to the portion of the child care center attributable to serving the children of those employees. Thus, we direct our attention to the parties' arguments regarding Marshfield Clinic employees.

¶ 36. With no more detail than we summarize here, the Hospital argues that use of its child care center by all Clinic employees is "reasonably necessary to [the Hospital's] exempt purpose." The Hospital asserts that its medical staff consists principally of Marshfield Clinic physicians and that other Clinic employees "provide health care services to Hospital patients through contract-for-service and lease arrangements, ... [or] indirectly provide services or support to Hospital patients." The Hospital asserts that the "availability of child care is a factor in the decision-making of many Clinic employees, just as it is with Hospital employees." The Hospital does not, however, point to undisputed facts showing that all of the Clinic employees directly or indirectly provide diagnosis, treatment, or care to Hospital patients.

¶ 37. We quote the City's argument with respect to Marshfield Clinic employees in its entirety:

While the Hospital has made some effort to identify, but only by job title, those Clinic employees who utilize the Day Care Center (R.13:Exhibit D; R-Ap.38a-38b), this is still insufficient proof under Deutsches Land. The Hospital has offered nothing to specifically demonstrate how the use of the Hospital's Day Care Center by these particular Clinic employees furthers the Hospital's ability to deliver health care to its patients other than "merely unsupported opinion testimony" with no "documented ... supporting evidence." (Id., 225 Wis. 2d at 98-99.)

¶ 38. These arguments raise more questions than they answer. Does the City really mean to argue that Clinic physicians who staff the Hospital do not, in the words of the City, "furtherO the Hospital's ability to deliver health care to its patients"? If so, we disagree. The record indicates that about 54 of 227 Clinic employee children served by the center are the children of Clinic physicians. It is undisputed that physicians are vital to patient care at the Hospital. We conclude that if all of these 54 children are children of physicians who staff the Hospital, then this partial use of the child care center satisfies Wis. Stat. § 70.ll(4m)(a).

¶ 39. We also note that the City has stipulated that other Marshfield Clinic health care workers provide services to Hospital patients. The stipulation of facts presented to the circuit court by the parties states:

Marshfield Clinic also employs other healthcare workers who provide health care services to Hospital patients through contract-for-service and lease arrangements, such as anesthesiologist technicians, electroneurodiag-nostic technicians, radiology technicians, pump technicians, CT technicians, ultrasonographers, and certified registered nurse anesthetists ("CRNAs"). Other Marsh-field Clinic employees indirectly provide services or support to Hospital patients, including lab employees who work in the joint lab, human resource personnel who recruit the physicians, medical transcriptionists who prepare the physicians' dictation for the joint medical record, as well as radiology clerks, blood bank specialists and research scientists.

Attached to the stipulation is an employee listing, by job title, that plainly includes several of the categories of employees identified in the above stipulation language. Is the City now contending that these employees do not "further[] the Hospital's ability to deliver health care to its patients"?

¶ 40. At the same time, we are uncertain what the Hospital is arguing. Is the Hospital arguing that all listed Clinic employees provide direct or indirect services supporting Hospital patients? The list of Clinic employees with children at the center shows that several have job titles with no apparent connection to the Hospital, such as "Claims Approver," "Legal Assistant," and "Supply Clerk."

¶ 41. Based on the record and the arguments before us, we cannot determine what portion of the child care center property is attributable to use by the children of Marshfield Clinic employees who are "reasonably necessary" to the efficient functioning of the Hospital. Therefore, we remand for further proceedings on this topic. Because we have already concluded that the child care center reduces tardiness and absenteeism and enhances recruitment, on remand the Hospital has the burden of showing what percentage of the children in the center are children of Marshfield Clinic employees who directly or indirectly provide diagnosis, treatment, or care to Hospital patients.

¶ 42. We readily acknowledge that this approach is burdensome inasmuch as it requires an employee-by-employee or a job-by-job analysis. Moreover, it would appear to be an approach that leads to percentages that change from year to year. We are also aware that the "reasonably necessary" analysis we direct the circuit court to apply to Clinic employees lacks clarity. In particular, there may be a dispute on remand as to the meaning of "indirectly providing diagnosis, treatment, or care" to hospital patients. How might a Clinic employee indirectly provide such services and still be considered reasonably necessary to the efficient functioning of the Hospital as an organization? However, this lack of clarity flows from the posture of this case. The parties here have not addressed the meaning of Wis. Stat. § 70.11 (4m)(a) with respect to particular Clinic employees or job categories. That is, we have not been asked to interpret and apply the statute to particular Clinic employees knowing specifically what the employee does or what portion of his or her time is spent on Hospital-related activities. Unlike Hospital employees, who we can safely assume spend substantially all of their work time contributing to the mission of the Hospital, we know little of the activities of the Clinic employees. Thus, we have no opportunity in the context of this appeal to interpret § 70.11(4m)(a) with respect to specific Clinic employee situations.

3. Bright Horizons Employees

¶ 43. Bright Horizons is a for-profit company employed by the Hospital to manage its child care center. Sixteen full-time spaces, or about 5% of the total full-time spaces, are reserved for the children of Bright Horizons employees. The Hospital argues that the spaces allocated to Bright Horizons employees benefit the Hospital because it "reduces absenteeism by Bright Horizons' employees, thereby enhancing the care provided to children of Hospital employees." In the alternative, the Hospital argues that the number of spots set aside for Bright Horizons employees is de minimis.

¶ 44. The City responds that although it may be convenient for Bright Horizons employees to have their children at the facility where they work, such convenience does not assist the Hospital in providing care to its patients. The City also argues that 5% of property assessed at about three million dollars is not de mini-mis.

¶ 45. As posed by the parties, the narrow question presented is whether the set-aside for the children of the private company's employees constitutes a tax-exempt use of the facility within the meaning of Wis. Stat. § 70.11(4m)(a) when that facility is otherwise tax exempt under the statute because it serves Hospital employees. We conclude that the use of the child care center, for the employees of Bright Horizons is no different in terms of benefit to the Hospital than if the Hospital used its own employees to staff the center and offered the same set-aside spaces to Hospital-employed child care workers. In either case, the provision of child care to children of child care workers contributes to a well-run child care center, both in terms of recruiting child care workers and in reducing their absenteeism. This, in turn, directly benefits the Hospital employees and, ultimately, the Hospital itself.

¶ 46. But this does hot resolve the matter. As explained above, we are remanding for a determination of the percentage of children using the center who are the children of Clinic employees who directly or indirectly provide diagnosis, treatment, or care to Hospital patients. The resolution of that issue will, in turn, affect the analysis regarding Bright Horizons employees. Some portion of spaces used by the children of Bright Horizons child care workers may not be reasonably necessary to the efficient functioning of the Hospital as an organization because these spaces relate to Bright Horizons workers attributable to Clinic employees who do not directly or indirectly provide diagnosis, treatment, or care to Hospital patients.

¶ 47. Furthermore, if this puzzle is solved on remand, the circuit court may have to address the parties' dispute that the percentage is de minimis. Assuming, for the sake of argument, that partial exemptions are permitted and that the proper allocation method involves allocating the percentages of the property which are taxable and tax exempt in direct proportion to qualifying percentages of children in the three groups, we agree with the City that 5% of an assessed value of about three million dollars is not de minimis. But we know the percentage will be something less than 5% because we already know that a substantial percentage of Bright Horizons child care workers are attributable to Hospital employees and Clinic employees who directly or indirectly provide diagnosis, treatment, or care to Hospital patients. The Hospital states that in Deutsches Land the supreme court suggested that 1% commercial use of property is de minimis. This is nearly accurate. In Deutsches Land, the supreme court pointed with approval to a prior case in which less than 1% non-conforming use was de minimis. Deutsches Land, 225 Wis. 2d at 83. As the Hospital accurately points out, the Deutsches Land court also indicated that 10% is not de minimis. Id. at 84. Where the line falls in between is a question to be decided on a case-by-case basis. The Deutsches Land court concluded:

In general, the relevant question is this: How consequential was the questionable activity when compared to the total activity on the property? This fact-specific question can only be answered on a case-by-case basis.

Id. (citations omitted).

¶ 48. Accordingly, neither party is entitled to summary judgment with respect to Bright Horizons employees, and we remand on that topic.

Conclusion

¶ 49. We have concluded that the portion of the Hospital's child care center attributable to Hospital employees is tax exempt under Wis. Stat. § 70.11(4m)(a). We interpret the parties' stipulation of facts and briefs as showing that it is undisputed that 49% of the Hospital's child care center is attributable to Hospital employees.

¶ 50. We have also concluded, with respect to the spaces filled by the children of Marshfield Clinic employees, that factual and perhaps legal disputes remain over which of the Clinic employees satisfy the "reasonably necessary" test. We have concluded that use of the center by the children of Clinic physicians who staff the hospital satisfies the "reasonably necessary" test. However, we cannot tell from the record and the arguments before us whether use by the children of other Clinic employees meets this test. In this regard, the circuit court need not start from scratch. We have concluded that the child care center reduces tardiness and absenteeism and enhances recruitment. This part of our reasoning applies equally to Hospital and Clinic employees. On remand, it remains to be determined what percentage of the children in the center are children of Clinic employees who directly or indirectly provide diagnosis, treatment, or care to Hospital patients.

¶ 51. Finally, we have concluded that a dispute remains with respect to Bright Horizons employees. As we explain above, the resolution of that issue is intertwined with the resolution of the Clinic employees issue. The guidance we are able to give on this topic is contained in paragraphs 45 to 48, above. Also, although it may be clear to the parties and the circuit court, it is not apparent to this court how it is that the children of Bright Horizons employees comprise 5% of the use of the child care center when use by others seemingly totals 100%. We previously commented on this topic in footnote 2.

By the Court. — Judgment reversed and cause remanded with directions.

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

       The City agrees that 2% of the facility attributable to a "Healthy Birth Program," is tax exempt. Accordingly, we address only the remaining 98%. The composition of this 98%, however, is puzzling. The record and the parties' briefs seemingly inform us that this 98% is comprised of 49% for Hospital employees, 49% for Clinic employees, and 5% for Bright Horizons employees. The parties have not explained why these percentages do not add up to 98%.

       The full text of Wis. Stat. § 70.11(4m)(a) reads:
      70.11 Property exempted from taxation....
      (4m) Nonprofit hospitals, (a) Real property owned and used and personal property used exclusively for the purposes of any hospital of 10 beds or more devoted primarily to the diagnosis, treatment or care of the sick, injured, or disabled, which hospital is owned and operated by a corporation, voluntary association, foundation or trust, except an organization that is organized under s. 185.981 or ch. 611, 613 or 614 and that offers a health maintenance organization as defined in s. 609.01(2) or a limited service health organization as defined in s. 609.01(3) or an organization that is issued a certificate of authority under ch. 618 and that offers a health maintenance organization or a limited service health organization, no part of the net earnings of which inures to the benefit of any shareholder, member, director or officer, and which hospital is not operated principally for the benefit of or principally as an adjunct of the private practice of a doctor or group of doctors. This exemption does not apply to property used for commercial purposes, as a health and fitness center or as a doctor's office. The exemption for residential property shall be limited to dormitories of 12 or more units which house student nurses enrolled in a state accredited school of nursing affiliated with the hospital.

       The statute addressed in Columbia Hospital Ass'n v. City of Milwaukee, 35 Wis. 2d 660, 151 N.W.2d 750 (1967), Wis. Stat. § 70.11(4m) (1965), varies in some respects from the current version. However, the pertinent language for purposes of our analysis, "used exclusively for the purposes of," remains unchanged.

       Specifically, we are referring to the following cases cited in Columbia Hospital: Arnold College v. Town of Milford, 128 A.2d 537 (Conn. 1957); Yale Univ. v. Town of New Haven, 42 A. 87 (Conn. 1899); Maxwell v. Good Samaritan Hosp. Ass'n, 161 So. 2d 31 (Fla. Dist. Ct. App. 1964); Oakwood Hosp. Corp. v. Michigan State Tax Comm'n, 132 N.W.2d 634 (Mich. 1965); State v. Fairview Hosp. Ass'n, 114 N.W.2d 568 (Minn. 1962); Midwest Bible & Missionary Inst. v. Sestric, 260 S.W.2d 25 (Mo. 1953); People ex rel. Clarkson Mem'l College v. Haggett, 77 N.Y.S.2d 182 (1948); Doctors Hosp. v. Board of Tax Appeals, 181 N.E.2d 702 (Ohio 1962); Aultman Hosp. Ass'n v. Evatt, 42 N.E.2d 646 (Ohio 1942); Multnomah School of the Bible v. Multnomah County, 343 P.2d 893 (Or. 1959); Carter v. Patterson, 39 S.W. 1110 (Tex. Civ. App. 1897); Parker v. Quinn, 64 P. 961 (Utah 1901).

       For that matter, the City agrees that the Hospital is entitled to a 2% partial exemption because the center's "Healthy Birth Program" is property tax exempt. The record indicates that this exemption is based on the exemption for benevolent institutions, Wis. Stat. § 70.11(4), because the "Healthy Birth Program" is open to the community and supported by the United Way, a benevolent non-profit agency. To repeat, this partial exemption is not disputed, and we do not address it.

       Wisconsin Stat. § 70.1105 reads:
      Taxed in part. (1) Property that is exempt under s. 70.11 and that is used in part in a trade or business for which the owner of the property is subject to taxation under sections 511 to 515 of the internal revenue code, as defined in s. 71.22(4m), shall be assessed for taxation at that portion of the fair market value of the property that is attributable to the part of the property that is used in the unrelated trade or business. This section does not apply to property that is leased by an exempt organization to another person or to property that is exempt under s. 70.11(34).
      (2) Property, excluding land, that is owned or leased by a corporation that provides services pursuant to 15 USC § 79 to a light, heat, and power company, as defined under s. 76.28(l)(e), that is subject to taxation under s. 76.28 and that is affiliated with the corporation shall be assessed for taxation at the portion of the fair market value of the property that is not used to provide such services.

       We question whether the partial property tax exemption approach that flows from assumptions made by the parties is practical with respect to these parties or as a general rule. As will be obvious from our later discussions, there is the difficulty in factually assessing contributions to a hospital by non-hospital employees — either individually or by job type — and applying the "reasonably necessary" test to these individuals or job types. There is also the question of timing: What time period should be used to establish the percentage of a property attributable to a tax-exempt use? This opinion expressly and implicitly raises several other questions. However, in light of the limitations imposed by the posture of this case, the statutes, the supreme court case law, and the absence of briefing on certain issues, we do not discern a more practical solution.

       To the extent the City disputes the value of the child care center as a recruiting tool, its argument focuses on whether new hospital employees could find comparable alternative child care. But the City does not dispute the fact that the Hospital uses the child care center as a recruiting tool or that the Hospital is able to present evidence showing that some employees chose to work at the Hospital in part because of the child care center. The City does not argue in its appellate brief that this evidence or any other evidence listed above is inadmissible.

       The Hospital nominally disagrees with the City's assertion that an employee-by-employee approach is appropriate with respect to Marshfield Clinic employees, but we think the Hospital's argument, taken as a whole, amounts to a concession that such an approach is proper. The Hospital does argue that it need not provide the sort of specific evidence required in Deutsches Land, Inc. v. City of Glendale, 225 Wis. 2d 70, 591 N.W.2d 583 (1999). However, the dispute over the applicability of Deutsches Land is beside the point. The Hospital's proffered justification — for extending tax-exempt status to that portion of the child care center relating to Marshfield Clinic employees — is that the Clinic employees "provide health care services to Hospital patients ... [or] indirectly provide services or support to Hospital patients." Because this is the Hospital's justification, it follows that it does matter what portion of the Clinic employees using the center provide direct or indirect services to Hospital patients. The Hospital does not explain how this portion can be determined without an analysis of the duties of particular employees or categories of employees.

       We observe that Marshfield Clinic's own property tax exemption status under Wis. Stat. § 70.11(25) is irrelevant to our discussion. The Hospital does not argue that it is entitled to a tax exemption because of the Clinic's tax status. Moreover, the "reasonably necessary" test has no relevance to § 70.11(25). University of Wisconsin Medical Foundation, Inc. v. City of Madison, 2003 WI App 204, ¶¶ 16-17, 34, 267 Wis. 2d 504, 671 N.W.2d 292, review denied, 2004 WI 20, 269 Wis. 2d 198, 675 N.W.2d 804 (Jan. 23, 2004) (No. 02-1473).

       We are uncertain if all of the Marshfield Clinic physicians staff the Hospital. It may be that some of the physicians — listed on Exhibit D attached to the parties' stipulation — do not staff the Hospital. Obviously, if a physician does not staff the Hospital or is not otherwise "reasonably necessary" to the Hospital, there is no basis for a tax exemption under Wis. Stat. § 70.11(4m)(a) for that portion of the child care center attributable to caring for such physician's children.

       The City contends that this analysis must be conducted with respect to the use of the child care center on January 1, 2000, and January 1,2001. However, we agree with the Hospital that the authority the City relies on, Family Hospital Nursing Home, Inc. v. City of Milwaukee, 78 Wis. 2d 312, 254 N.W.2d 268 (1977), and Friendship Village of Greater Milwaukee, Inc. v. City of Milwaukee, 181 Wis. 2d 207, 511 N.W.2d 345 (Ct. App. 1993), falls short of stating this proposition. But we find the Hospital's argument no more persuasive. The Hospital asserts that assessments need not be tied to any particular date, but the Hospital does not provide a workable alternative. The Hospital notes that neither Columbia Hospital nor Sisters of St. Mary involves evidence tied to a specific assessment date, but neither of those cases involved calculating partial tax-exempt status. The Hospital points out that in Deutsches Land the supreme court looked at the percentage of time a facility was used over the course of the disputed tax year. Deutsches Land, 225 Wis. 2d at 86-87. That may be true, but there is no indication in Deutsches Land that either party raised this issue. We decline to address the issue because we find the briefing inadequate. On remand, we invite the circuit court's and the parties' attention to Wis. Stat. § 70.10 and the introductory portion of § 70.11, which may shed some light on this topic.

        See paragraphs 28 and 29, above.

       The City implicitly argues that the value of the property is a factor to consider when deciding whether a non-conforming use is de minimis. The City apparently takes the position that the higher the property value, the more likely a small percentage of non-conforming use will not be ignored as de minimis. This argument merits consideration, but we have no reason to address it.


source: Caselaw Access Project

author: SNYDER, J.

license: Public Domain

text:
    In re the Marriage of: Amy Rumpff, a/k/a Amy Forkins, Joint-Petitioner-Respondent, v. Timothy Earl Rumpff, Joint-Petitioner-Appellant.
    Court of Appeals

      No. 03-2646.

      Submitted on briefs June 2, 2004.

    Decided September 8, 2004.

    2004 WI App 197
    (Also reported in 688 N.W.2d 699.)

      On behalf of the joint-petitioner-appellant, the cause was submitted on the briefs of James Ungrodt, Kiel.
    On behalf of the joint-petitioner-respondent, the cause was submitted on the brief of Travis K. Glandt of Rummer, Lambert & Fox, LLP, Manitowoc.
    Before Anderson, PJ., Brown and Snyder, JJ.
   SNYDER, J.

¶ 1. Timothy Earl Rumpff appeals the property division and child support award associated with a judgment of divorce. He argues that the trial court misinterpreted or misapplied child support regulations, erroneously valued retirement assets, and failed to properly consider contributions Timothy made to the marital residence. Timothy asserts that the trial court erroneously exercised its discretion and that the matter should be remanded for further proceedings. We disagree and affirm the judgment of the trial court.

FACTS

¶ 2. Timothy Rumpff and Amy Rumpff (a/k/a Amy Forkins) were married on September 29, 1986. They had two children during the marriage, Marcus, born April 7, 1989, and Megan, born October 14, 1992. The parties filed a joint petition for divorce in August 2001.

¶ 3. A temporary order provided that the parties would have joint legal custody of the children and that they would share physical placement on an alternating weekly basis. The order also provided that Timothy would keep temporary occupancy of the marital residence and would pay the mortgage, taxes, and insurance on the residence. Finally, the order advised that a guardian ad litem would be appointed for the children.

¶ 4. An amended temporary order incorporated the GAL's recommendation for placement, and revised the schedule as follows: Timothy would have placement on Mondays and Tuesdays from after school until 7:00 p.m., and a Wednesday overnight, with alternating weekends from Friday after school until Sunday evening. Amy would have placement at all other times. The amended order stated that this placement arrangement "result[ed] in approximately equal sharing of time with the children."

¶ 5. The trial took place on May 12, 2003. The parties stipulated to a modified placement schedule which substantially adopted the GAL's previous recommendations. The modifications were as follows: (1) summer vacation would be split equally, including overnights, in increments to be agreed upon by the parties; (2) each party would have two one-week periods of uninterrupted placement during the summer for purposes of vacationing; (3) during the school year, Timothy would have two additional overnights per month with Megan in September, October, April and May; and (4) in the remaining months during the school year, there could be occasional additional overnights for Megan with Timothy. The court incorporated the placement stipulation into the judgment of divorce and concluded that Timothy's time with the children represented approximately thirty-six percent of the overnight placements. The court expressly declined to afford any overnight equivalency credit to Timothy for the days he had placement until 7:00 p.m.

¶ 6. The trial court applied the child support percentage guideline found in the Wisconsin Administrative Code to arrive at the child support award of $155 per week, less a $26 weekly credit for Amy's portion of the children's health insurance premium. Wis. Admin. Code § DWD 40.03(l)(b) (2003). The court decided to apply the standard guideline, here twenty-five percent of Timothy's 2002 gross income, despite placement of the two children with Timothy for thirty-six percent of the time. The court reasoned that setting child support at the guideline level and eliminating Timothy's responsibility for thirty-six percent of the children's variable expenses would eliminate the need for splitting expenses sixty-four/thirty-six between the parties.

¶ 7. With regard to the property division, the trial court reduced the value of Amy's retirement assets by twenty percent to reflect potential tax consequences. The court determined that Timothy would not receive any credit for 401(k) loan payments he made during the pendency of the action, nor would he receive credit for contributions made to his 401(k) plan since the divorce action commenced. The court also determined that Timothy brought $12,000 from a previous divorce settlement into the marriage and that Timothy's parents gifted 0.9 acres of land to Amy and Timothy. The parties each received a share of the personal property accumulated during the marriage, which included horses and a trailer, snowmobiles, automobiles, a camper, furniture, and jewelry.

¶ 8. Timothy appeals, challenging the child support award and several aspects of the property division.

DISCUSSION

¶ 9. Timothy challenges the child support award, alleging that the amount of child support should have been reduced using the shared-time payer calculation and that he should receive credit against his child support obligation because he provides overnight equivalent care for the children. He also argues that Amy's pension plan should not be valued at twenty percent less than its current assessment because there was no proof of potential tax consequences offered at trial. Finally, Timothy contests the court's property division, arguing that the court should have considered his contributions to the marital estate and should have deviated from an equal distribution of property. We take each issue in turn.

Shared-Time Payer Child Support Calculation

¶ 10. Timothy asserts that the trial court erroneously exercised its discretion in setting child support because it did not apply the shared-time payer formula under Wis. Admin. Code § DWD 40.04(2)(b), which provides for a reduction in child support for a shared-time payer. The determination of appropriate child support is committed to the sound discretion of the trial court and we will affirm the court's discretionary act if the trial court examined the relevant facts, applied a proper standard of law, and used a rational process to reach a conclusion that a reasonable judge could reach. Luciani v. Montemurro-Luciani, 199 Wis. 2d 280, 294, 544 N.W.2d 561 (1996). Whether a trial court properly exercised its discretion is a question of law. Id.

¶ 11. Timothy first directs us to Wis. Stat. § 767.25(lj) (2001-02), which instructs the trial court to determine child support payments based on the percentage standards promulgated by the Department of Workforce Development. Wisconsin Administrative Code § DWD 40.03(1), entitled "Determining child support using the percentage standard," presents the method for calculating the income of the payer and the percentage to be applied. The regulations allow for deviation from the straight percentage standard when the payer parent is a "shared-time payer." See § DWD 40.04(2). A shared-time payer is a "payer who provides overnight child care or equivalent care beyond the threshold and assumes all variable child care costs in proportion to the number of days he or she cares for the child under the shared-time arrangement." Sec. DWD 40.02(25) Here, Timothy had overnight placement of the children for approximately 133 nights per year, or an estimated thirty-six percent of the overnight placement.

¶ 12. The trial court used the child support percentage guideline and Timothy's 2002 gross income to arrive at a support amount of $155 per week. The court also determined that Amy's portion of the children's health insurance premium could be deducted from the weekly support, leaving Timothy with a child support obligation of $129 per week. Timothy challenges the trial court's use of his 2002 gross income as the basis for the calculation; however, the court expressly determined that Timothy's 2002 gross income was the figure that was "most accurate in determining what his income [is] currently."

¶ 13. The trial court determined that the shared-time payer calculation under Wis. Admin. Code § DWD 40.04(2)(b) would reduce Timothy's child support obligation by twenty percent and would obligate him to pay thirty-six percent of the children's variable expenses. After testimony from both Timothy and Amy, the court decided that it would be fair for Timothy to pay child support under the standard percentage guideline, without a reduction under the shared-time payer provision of § DWD 40.04(2)(b), but to discontinue his obligation regarding variable expenses.

¶ 14. Timothy argues that the court went beyond the bounds of its discretion when it failed to use the shared-time payer calculation. He argues, correctly, that the calculation of the presumptive child support obligation under Wis. Stat. § 767.25(lj) includes the shared-time payer formula. See Randall v. Randall, 2000 WI App 98, ¶¶ 12-15, 235 Wis. 2d 1, 612 N.W.2d 737. However, the trial court has the discretionary authority to set aside the guideline percentages when it finds that the use of the presumptive child support amount "is unfair to the child or to any of the parties." Sec. 767.25(lm). A trial court is not required to apply the percentage guidelines in every case, hut it must articulate its reasoning process for the decision to remain within the support guidelines or to deviate from them. Luciani, 199 Wis. 2d at 295. Although this trial court did not reference specific facts from the record in its written findings, it did assert that the child support order was "supported by the evidence" and based on the record. When a trial court does not explicitly state its reasons for a child support order, we may search the record for reasons to sustain the trial court's discretionary decision. Randall, 235 Wis. 2d 1, ¶ 7.

¶ 15. At trial, the parties testified regarding the variable expenses incurred on behalf of the children. Notably, Amy testified that the children's variable expenses raised some issues and that there were monetary problems between the parties in this regard. Timothy testified that he did not always ask Amy to pay her share of the variable expenses. The record indicates that both parties treated the variable expenses obligation with some informality, and both admitted that at times they did not inform the other party of expenses they had incurred on behalf of the children.

¶ 16. The trial court recognized the potential for future litigation over the variable expenses. It expressly referenced Amy's testimony when ruling that the problems inherent in ordering a sixty-four/thirty-six split of the variable expenses would be avoided if Timothy paid the support guideline amount of twenty-five percent of his gross income and in return was relieved of any responsibility for the variable expenses. Although the court determined that "economically it may be to the benefit of [Timothy]" to order the standard child support percentage guideline and omit the variable expenses from the child support award, it recognized that Amy was willing to forego Timothy's contribution to variable expenses and observed that this arrangement would avoid future litigation over the exchange of money that a sixty-four/thirty-six split of variable expenses would likely produce. We will uphold the trial court's decision unless we determine that discretion was not exercised or there was no reasonable basis for the trial court's decision. Wester v. Bruggink, 190 Wis. 2d 308, 317, 527 N.W.2d 373 (Ct. App. 1994). In Luciani, 199 Wis. 2d at 295, our supreme court stated that the trial court can deviate from child support percentage guidelines when it finds that use of the guidelines "would be unfair to the children or either of the parties." Here, the trial court followed the standard guideline, but deviated from the shared-time payer formula, to craft a child support award it felt was fair to Timothy and Amy. We identify ample evidence to support the court's child support order and we conclude that the trial court reasonably exercised its discretion when imposing the standard child support percentage guideline and removing Timothy's obligation for variable expenses.

Equivalent Care

¶ 17. Timothy argues that he provides equivalent care for the children on Mondays and Tuesdays during the school year. He calculates that the added placement results in approximately 160 annual overnights, or over forty-three percent of the total overnight placement.

¶ 18. Equivalent care is explained in a footnote to Wis. Admin. Code § DWD 40.02(25):

There are physical placement arrangements in which the payer provides child care beyond the threshold and incurs additional cost in proportion to the time he or she provides care, but because of the physical placement arrangement he or she does not provide overnight care (e.g. payer provides day care while the payee is working). Upon request of one of the parties the court may determine that the physical placement arrangement other than overnight care is the equivalent of overnight care.

¶ 19. Timothy asserts that the trial court failed to consider or to analyze the issue of equivalent care, and that this failure constitutes an erroneous exercise of discretion. See McCleary v. State, 49 Wis. 2d 263, 277, 182 N.W.2d 512 (1971) (There should be evidence in the record that discretion was exercised.). Although the proper exercise of discretion contemplates that the trial court will explain its reasoning, when it does not, we may search the record for facts that support the court's discretionary decision. Randall, 235 Wis. 2d 1, ¶ 7.

¶ 20. At trial, Timothy did not offer any testimony regarding expenses incurred or substantial care provided on days he had placement until 7:00 p.m. During Timothy's closing argument, he stated that his Monday and Tuesday afternoons during the school year should be considered the equivalent of overnight placements. The trial court was not persuaded by Timothy's characterization of his weekday placements, stating that it "declines to afford any overnight equivalent to the placement exercised between [Timothy] and the minor children."

¶ 21. On appeal, Timothy argues that he provides equivalent care for the children on days he has placement until 7:00 p.m. and provides their evening meals. He calculates that while summer placement is equally divided, he provides more than half of the evening meals during the school year: Mondays, Tuesdays, Wednesdays and alternating weekends. Specifically, Timothy argues that "[t]he 'cost' of an overnight is the meal cost." Amy counters that Timothy has the children for only three and one-half hours on Mondays and Tuesdays and that this is not the equivalent of overnight care.

¶ 22. We agree with the trial court's conclusion that Timothy has not demonstrated that the Monday and Tuesday placement until 7:00 p.m. constitutes equivalent care. If the DWD had intended an evening meal to equate to an overnight equivalent, it could have advised as much in a note to this section. Instead, as the note to Wis. Admin. Code § 40.02(25) indicates, equivalent care must be something of substance. Timothy's provision of an evening meal on days he has the children until 7:00 p.m. does not rise to the level of care envisioned by the DWD.

Reduced Value of Retirement Assets to Reflect Potential Tax Consequences

¶ 23. Timothy also challenges the trial court's decision to reduce the value of Amy's pension plan by twenty percent. He argues that there was no expert testimony regarding any potential tax consequences and therefore Amy's pension should have been incorporated into the property division at its actual current value. Amy responds that courts are allowed to consider tax consequences when making a property division under Wis. Stat. § 767.255(3)(k).

¶ 24. We agree with Amy that property division rests within the sound discretion of the trial court. See Ashraf v. Ashraf, 134 Wis. 2d 336, 340, 397 N.W.2d 128 (Ct. App. 1986). We will not disturb the trial court's judgment unless there is an abuse of discretion. Id. Furthermore, "[v]aluation of all assets, including the present value of a pension plan, is admittedly somewhat speculative." Corliss v. Corliss, 107 Wis. 2d 338, 344, 320 N.W.2d 219 (Ct. App. 1982). Accordingly, the trial court is afforded broad discretion in the valuation and division of retirement and pension rights. Laribee v. Laribee, 138 Wis. 2d 46, 52, 405 N.W.2d 679 (Ct. App. 1987).

¶ 25. Timothy contends that the twenty percent reduction was arbitrary because there was no expert testimony, no offer of proof, and no testimony from Amy regarding the potential tax consequences for her pension plan. However, in Selchert v. Selchert, 90 Wis. 2d 1, 9, 280 N.W.2d 293 (Ct. App. 1979), we stated that a tax of ten to twenty percent was "reasonable speculation." In Ashraf, there was expert testimony regarding potential tax consequences and the present value of the retirement assets of one of the parties. There we stated that "[g]iven such uncontradicted testimony, the trial court must either accept it or explain why it found the testimony improbable or the witness discredited." Ashraf, 134 Wis. 2d at 346. Ashraf therefore instructs us that when there is expert testimony, the court need not resort to "reasonable speculation." However, here, where no expert testimony was presented, the court may reasonably speculate as to the present value of retirement assets. See Selchert, 90 Wis. 2d at 9. The trial court reduced the value of Amy's retirement assets by twenty percent to reflect potential tax consequences and arrive at a fair representation of the present value of Amy's pension plan. In the absence of any expert testimony or other evidence to the contrary, the court may rely on its knowledge and experience to engage in reasonable speculation regarding the anticipated tax impact on the present value of retirement assets.

Property Division

¶ 26. Timothy raises three issues concerning the property division. First, he challenges the trial court's refusal to credit him for payments he made toward the mortgage, payments he made on a loan from his 401(k), and contributions he made to his 401(k) during the pending divorce action. Second, he argues that he contributed $12,000 from a previous divorce settlement to improve the marital residence and that the property division should reflect his contribution. Finally, he asserts that the court should have considered the parcel of land gifted by his parents as grounds for making an unequal division of property.

¶ 27. Valuation and division of the marital estate at divorce lie within the sound discretion of the trial court. Garceau v. Garceau, 2000 WI App 7, ¶ 3, 232 Wis. 2d 1, 606 N.W.2d 268. We will therefore uphold the trial court's valuation and division of property if we determine that the trial court considered the relevant facts, applied the proper standard of law, and used a rational process to reach a conclusion that a reasonable judge could reach. Id.

¶ 28. Here, the trial court determined that Timothy's mortgage payments were in lieu of rent and he was ordered to pay the mortgage because he continued to live in the residence. The court also held that Timothy's contributions to his 401(k) plan were voluntary and that the asset was "subject to division at the time of the divorce, not at the time of the separation." A marital estate is usually valued as of the date of the divorce. Sommerfield v. Sommerfield, 154 Wis. 2d 840, 851, 454 N.W.2d 55 (Ct. App. 1990). When conditions over which a party has little or no control arise, however, special circumstances can warrant deviation from the rule. Id. In our judgment, the facts of this case do not warrant the application of the exception. Timothy has not demonstrated any special circumstances to support deviation from the general rule that the property will be valued as of the date of the divorce. See id. We agree with the trial court that Timothy had the benefit of living in the residence and that no credit was due him in the property division at the time of the divorce. This conclusion is supported by the facts and demonstrates a proper application of the law.

¶ 29. Timothy makes similar arguments regarding his $12,000 contribution to the residence and the gifted parcel of land. Although he does not argue that these assets were individual property at the time of the divorce, he asserts that the court should have given him credit for the property he added to the marital estate. Timothy argues that under Wis. Stat. § 767.255(3)(b), the court should have deviated from the presumption of equal distribution of property. Again, the issue is one of discretion for the trial court. See Garceau, 232 Wis. 2d 1, ¶ 3. The record demonstrates that the trial court's findings of fact are supported by the testimony and documentary evidence presented at trial. Furthermore, the court considered the factors under § 767.255(3), noting the long-term nature of the marriage, Timothy's $12,000 contribution, the parcel of land gifted by Timothy's parents, the economic value of each party's contribution to the marriage, and additional factors. Specifically, the trial court stated that Amy's role in helping to raise the children of Timothy's prior marriage "should be taken into account to a certain extent to balance out the amount of property that was brought to the marriage by [Timothy]." This is an appropriate exercise under § 767.255(3)(d), which allows the court to consider the economic value of a party's contribution to the marriage in homemaking and child care services.

¶ 30. Timothy asks us to remand this matter with directions to the trial court to consider the $12,000 and gifted parcel of land in its division of property. We conclude that the trial court has already considered these matters and, as demonstrated by the record, appropriately exercised its discretion in valuing and dividing the property.

CONCLUSION

¶ 31. We conclude that the record contains ample evidence to support the trial court's child support order and that the trial court reasonably exercised its discretion when imposing the standard child support percentage guideline and removing Timothy's obligation for variable expenses. We further conclude that equivalent care credit is available only when the parent demonstrates that the care he or she is providing, while not overnight care, is something of substance. The provision of an evening meal does not rise to the level of equivalent care.

¶ 32. We also conclude that in the absence of any expert testimony or other evidence to the contrary, the trial court may rely on its knowledge and experience to engage in reasonable speculation regarding the anticipated tax impact on the present value of retirement assets.

¶ 33. Finally, we conclude that the trial court has properly exercised its discretion in the matter of the property division in this case.

By the Court. — Judgment affirmed.

       All references to the Wisconsin Administrative Code are to the version found in the Wisconsin Administrative Register, January 2003, No. 565 unless otherwise noted. Revisions that are referenced in this opinion appear in the Register, December 2003, No. 576.

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

       We observe that Wis. Admin. Code § DWD 40.02(25) has been revised and renumbered, effective January 1, 2004. The current definition for "shared-time payer" is in § DWD 40.02(26) and has been renamed "shared-placement payer"; the definition itself has been changed, the reference to equivalent care has been eliminated and, most significantly, the note to § DWD 40.02(25) has been completely eliminated.

       This footnote was eliminated effective January 1, 2004. The current definition of "equivalent care" is found in Wis. Admin. Code § DWD 40.02(10).

       The use of the words "day care" suggests that the DWD contemplated a situation where the payer parent provides care, or the financial cost of such care, for the children while the payee parent is working. The current definition also requires care that is "substantially equivalent" to the cost of overnight care. Wis. Admin. Code § DWD 40.02(10).

       The terminology used when reviewing a trial court's discretionary act has been changed from "abuse of discretion" to "erroneous exercise of discretion" but the substance of the standard of review remains the same. City of Brookfield v. Milwaukee Metro. Sewerage Dist., 171 Wis. 2d 400, 423, 491 N.W.2d 484 (1992).

       Timothy's parents gifted a parcel of land to Timothy and Amy as survivorship marital property. The warranty deed clearly states this was the intent of the grantors, and Timothy does not dispute this fact. With regard to the $12,000 contribution, Timothy testified that he was not positive about how the money was used, but thought that $7,000 went to pay off the home loan from his father and the rest was used to make additions to the house. Amy testified that the house was refinanced several times.


author: WEDEMEYER, EJ.

text:
    Metropolitan Ventures, LLC, a Wisconsin limited liability company, Plaintiff-Appellant, v. GEA Associates, a Wisconsin limited partnership, Elizabeth Levins, and Margaret Reuss, as Trustee of the Henry S. Reuss Trust, Defendants-Respondents.

    Court of Appeals

      No. 03-1806.

      Oral argument June 8, 2004.

    Decided September 14, 2004.

    2004 WI App 189
    (Also reported in 688 N.W.2d 722.)

      On behalf of the plaintiff-appellant, the cause was submitted on the briefs of William M. Cannon and Charles David Schmidt of Cannon & Dunphy, S.C., Brookfield. There was oral argument by Charles David Schmidt.

      On behalf of the defendants-respondents, the cause was submitted on the brief of Charles H. Barr of Croen & Barr LLP, Milwaukee. There was oral argument by Charles H. Barr.

    Before Wedemeyer, EJ., Fine and Curley, JJ.

       Petition to review granted 12-15-2004.

   WEDEMEYER, EJ.

¶ 1. Metropolitan Ventures, LLC appeals from a judgment entered after the trial court granted summary judgment in favor of GEA Associates, Elizabeth Levins and Margaret Reuss, dismissing Metropolitan's complaint alleging that GEA Associates breached its contractual, legal and ethical duties. Metropolitan asserts that the trial court erred in ruling that no valid contract existed based on Nodolf v. Nelson, 103 Wis. 2d 656, 309 N.W.2d 397 (Ct. App. 1981), which held that the absence of specific financing terms rendered the contract illusory. Because the financing contingency did not render the contract illusory and because there is a material issue of fact regarding whether the financing contingency was waived, we reverse and remand for further proceedings.

I. BACKGROUND

¶ 2. On March 19, 2002, Metropolitan and GEA Associates executed a "Limited Fartnership Purchase Agreement" (LPPA), wherein Metropolitan would purchase GEA Associates, a business engaged in owning and operating the German English Academy Building, and a parking garage. The LPPA contained a financing contingency provision. The provision required that Metropolitan waive the contingency "within 30 days following full execution of this Agreement" or the "Agreement shall terminate without further force or effect."

¶ 3. On April 17, 2002, Daniel B. Genzel, Metropolitan's managing partner, sent a letter to Elizabeth Levins, sole general partner of GEA Associates, indicating that Metropolitan was "waiving its financing contingency" subject to three conditions. The letter requested certain documents from GEA Associates to complete financing approval and asked for an extension of the financing contingency until April 25, 2002. After receiving the letter, Levins forwarded the requested documents and granted the extension.

¶ 4. On April 25, 2002, Genzel sent a letter to Levins indicating that Metropolitan had received a satisfactory loan commitment from Anchor Bank and looked forward to closing the transaction. On April 29, 2002, Levins sent a letter to GEA Associates' limited partners explaining the LPPA, recommending the sale, and indicating the deal required two-thirds of the limited partners to sell their interests. Levins advised:

The general partners believe that selling to Metropolitan is in the best interests of the partners, and recommend that all of the limited partners participate in the sale .... [W]e are recommending a unanimous sale.
If a sufficient number of limited partners agree to participate in the sale, the initial closing will take place on or about May 18, 2002. It will take approximately 60 days beyond the date of the initial closing to wind up the accounting....

¶ 5. Sometime between May 1 and May 13, Gen-zel and Levins confirmed the financing waiver at a lunch meeting. On May 14, 2002, Genzel sent Levins a letter confirming:

that all of the contingencies on behalf of the Buyer have been satisfied and that Buyer is ready, willing and able to close the above-mentioned transaction.
As a follow up from our last meeting at lunch we are inquiring about the progress of the assignments of the interest in the Partnership from the Limited Partners. As you had mentioned that day you had thought that some of them might be late in responding to your letter as a General Partner recommending unanimous approval of the sale of the interest to the Buyer.
We would like to schedule a potential date of closing for Wednesday June 5, 2002 ....

¶ 6. However, on May 10, 2002, Levins sent a letter to the limited partners advising:

On May 8, 2002, the partnership received an unsolicited secondary offer to purchase the partnership real estate at a price that significantly exceeds the base purchase price to be paid under the pending contract with Metropolitan .... The buyer under the secondary offer is Steadfast Capital, LLC ....

¶ 7. The letter informed the limited partners that they were not bound to sell to Metropolitan and, in fact, the Metropolitan agreement would terminate if two-thirds of the limited partners did not agree to the sale. Attached to the letter was a summary term sheet comparing the principal economic terms of the two transactions. The letter also gave limited partners who had already agreed to sell their interest to Metropolitan the opportunity to revoke that decision.

¶ 8. On May 17, 2002, GEA Associates faxed a letter to Metropolitan asserting that the LPPA was terminated due to the inability to satisfy the two-thirds limited partnership assignments. On July 11, 2002, GEA Associates filed a declaratory judgment action asking the court to hold that it had properly and validly terminated the LPPA.

¶ 9. On September 17, 2002, Metropolitan filed a summons and complaint seeking damages based on GEA Associates' actions relating to the LPPA. This case was consolidated with the declaratory judgment action. On March 3, 2003, GEA Associates filed a motion to dismiss the case. On April 30, 2003, the trial court dismissed some of Metropolitan's claims, hut allowed Metropolitan to proceed on its intentional interference with the contractual relationship, breach of implied duty of good faith, and negligence claims.

¶ 10. Subsequently, GEA Associates filed a motion seeking summary judgment, asserting that no contract existed due to the lack of sufficient definiteness in the financing contingency provision. The trial court agreed with GEA Associates' argument and granted the motion dismissing the case. Judgment was entered. Metropolitan now appeals.

II. DISCUSSION

¶ 11. This case comes to us on a motion for summary judgment. The summary judgment standard of review is well known and need not be repeated here. See Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315, 401 N.W.2d 816 (1987). We will affirm the granting of summary judgment if there are no genuine issues of material fact and one party is entitled to judgment as a matter of law. Wis. Stat. §802.08(2) (2001-02). Whether the essential terms of a contract are definite presents a question of law that we review de novo. Herder Hallmark Consultants, Inc. v. Regnier Consulting Group, Inc., 2004 WI App 134, ¶ 6, 275 Wis. 2d 349, 685 N.W.2d 564.

¶ 12. The threshold issue is whether a valid contract existed. Metropolitan argues that the financing terms were definite enough under the law to result in a valid contract. GEA Associates argues that the financing terms were indefinite and too vague and therefore rendered the contract void. The trial court, relying on Nodolf, ruled in favor of GEA Associates and dismissed all of Metropolitan's claims. We hold that the financing terms were not illusory, and therefore did not invalidate the contract. Accordingly, we reverse the trial court's ruling and remand for further proceedings consistent with this opinion.

¶ 13. The financing clause at issue provides:

Financing Contingency. Buyer shall have obtained unconditional financing in an amount equal to 85% of the purchase price from a reputable Lender on terms satisfactory to Buyer and an appraisal which is satisfactory to Buyer in Buyer's sole discretion. Unless Buyer waives this contingency by written notice to Seller within 30 days following full execution of this Agreement, this Agreement shall terminate without further force or effect and Buyer's earnest money shall be promptly returned.

¶ 14. The trial court ruled that the financing clause lacked sufficient definiteness for it to determine the terms of financing, and therefore the entire contract was rendered unenforceable. See Nodolf, 103 Wis. 2d at 659. Metropolitan argues that Nodolf and cases similar to it all apply to real estate transactions. Metropolitan contends that the specificity in financing contingency rules has never been extended to business sale contracts. It concludes, therefore, that because the LPPA was a business sale contract rather than a real estate transaction, the Nodolf line of cases do not control. We are persuaded by the logic of this argument.

¶ 15. A business sale is distinct from a real estate sale. Specifically, when a transaction involves the sale of a business, the contract does not involve a fixed sale price due to the possibility that the buyer may not acquire a 100% ownership interest. The value of the business may also fluctuate between the time the contract is entered into and the actual closing date. As a result, the business sale buyer is unable to specify in the written contract the same terms and conditions as a buyer of real estate. The business sale presents unique characteristics. Accordingly, this court cannot rule that the cases setting forth financing requirements in real estate sales control the outcome of this case.

¶ 16. We recently addressed a similar issue in Herder Hallmark. In that case, John Herder sold his actuarial business to Steven Regnier. 2004 WI App 134, ¶ 2. However, the sale did not specify the sale price. Id., ¶ 4. Regnier argued, as a result, that no contract existed and that "indefiniteness voids any agreement." Id., ¶ 1. The trial court granted partial summary judgment to Herder, declaring that there was an express contract between Herder, Inc. and Regnier. Id. We granted Regnier's petition for leave to appeal.

¶ 17. In Herder, we determined that a "meeting of the minds" as to contract price is not required as long as the intent of the parties to contract is "discernible from their conduct or the contract language":

If parties evidently intended to enter a contract, the trier of fact should not frustrate their intentions, but rather should attach a "sufficiently definite meaning" to the contract language if possible. We have previously decided: "Even though the parties have expressed an agreement in terms so vague and indefinite as to be incapable of interpretation with a reasonable degree of certainty, they may cure this defect by their subsequent conduct and by their own practical interpretation." Nelson v. Farmers Mut. Auto. Ins. Co., 4 Wis. 2d 36, 51, 90 N.W.2d 123 (1958).

Id., ¶ 8 (quoting Management Comp. Servs. Inc. v. Hawkins, Ash, Baptie & Co., 206 Wis. 2d 158, 179-80, 557 N.W.2d 67 (1996) (citations omitted)). This court went on to quote Corbin on Contracts, adopting that treatise's rule that when a term is left indefinite, the contract will not be void for indefiniteness so long as the parties provide a practicable method for determining what the indefinite term will be or implicitly agree upon a reasonable definition of the term. Herder, 2004 WI App 134, ¶ 9 (citing 1 Arthur L. Corbin, Corbin on Contracts: Formation of Contracts § 4.3 (Joseph M. Perillo, ed., rev. ed. 1993)).

¶ 18. This case offers substantial guidance to resolution of the case at hand, particularly because the Herder case is more akin to the sale of a business than the Nodolf line of cases. Moreover, Herder involved the failure to specify a sale price, which is similar to GEA Associates's contention that the financing clause in the LPPA was too indefinite. Consistent with the reasoning in Herder, the evidence in the instant case demonstrates that the parties clearly intended to enter into a contract. Although the financing terms were not set forth with explicit specificity, the parties agreed to the relatively indefinite language because this was customary practice given the distinct characteristics of this type of sale. GEA Associates agreed to give Metropolitan the discretion to select the lending institution and the financing terms. In addition, the financing clause in the instant case contains more specificity than the agreement in Herder — it set forth the percentage of the purchase price to be financed and it set forth a practicable method in which the sale price would be determined.

¶ 19. In examining the clause in the context of the entire agreement, it clearly indicates, with as much specificity as possible, the amount of money which was to be financed — 85% of the purchase price, which is specifically addressed in Article II, section 2.1 a. of the LPPA. That clause sets forth the practicable method for determining the purchase price:

The base amount to be used in determining the Purchase Price shall be $3,300,000 ("Base Amount"). Within 60 days following Closing, the accounting firm of Reilly, Penner & Benton, or another accounting firm acceptable to both parties (the "Accountants"), shall prepare an interim balance sheet for the Partnership dated as of the date of Closing. The Base Amount shall then be increased or decreased, as the case may be, by an amount equal to the net book value of tangible Partnership assets (tangible assets minus liabilities), excluding Partnership real estate and the items of furniture, fixtures and equipment described on Exhibit C, as shown on the interim balance sheet. For example, but not by way of limitation, the interim balance sheet shall reflect the following as partnership liabilities: (i) accounts payable, (ii) mortgage debt, (iii) unearned rent, (iv) security deposits, (v) the excess (or deficit) of amounts collected from tenants over amounts due from tenants for real estate taxes, common area expenses, and/or other amounts payable by Tenants under the leases for periods up to and including the date of Closing, (vi) accrued employee compensation, and (vii) real estate tax and utilities accrued through the date of Closing; and shall reflect the following as partnership assets: (x) cash, (y) past due rent and other amounts receivable from tenants, and (z) prepaid insurance and other prepaid expenses. The Base Amount shall also be increased by the unamortized value of any leasehold improvements made by the Partnership with respect to leases to tenants commencing in 2002. The Base Amount so adjusted shall be referred to herein as the "Adjusted Base Amount."

¶ 20. The financing clause at issue here does not specify a particular term or rate of financing, but this does not render the contract illusory. Because of the fluidity involved in the sale of the business, financing terms could vary greatly over the course of a short period of time and thus, inserting those items into the contract would require speculation. Moreover, the specific mechanism set forth above makes definite what the discretionary financing clause left open. Accordingly, we reject GEA Associates' argument that the financing clause lacks sufficient definiteness. Article II, section 2.1 a. of the LPPA demonstrates that the parties modified the general financing contingency to provide a specific formula with which to calculate the required terms. We cannot find any Wisconsin authority which requires greater exactitude in a financing contingency for a business sale than that which was employed in the LPPA.

¶ 21. Further, this court concluded in Herder, that "the conduct of the parties cures any indefiniteness as to the price of the assets." Id., ¶ 15. The same conclusion applies to the instant case. Metropolitan and GEA Associates did not enter into the LPPA haphazardly. Drafts of the agreement were exchanged numerous times and revisions made accordingly. The conduct of the parties after the agreement was executed similarly established that both sides intended to contract and intended to be bound by the terms of the contract. Both acted as if the contract existed. Metropolitan solicited lending institutions to satisfy the financing contingency. GEA Associates provided necessary documentation requested for appraisal purposes. GEA Associates informed the limited partners of the existence of the contract and recommended the assignment of interests to Metropolitan.

¶ 22. It was not until GEA Associates received a better offer that actions quickly turned to attempting to terminate the contract between Metropolitan and GEA Associates. Prior to that point in time, both' parties operated as if the LPPA constituted a valid contract. This is significant. Based on the foregoing, we conclude that any indefiniteness in the financing clause did not render the contract void or illusory.

¶ 23. Having concluded that the financing contingency did not render the LPPA illusory, we now turn to the issue of whether the financing contingency was waived. Metropolitan argues that it waived the financing contingency or at least there is a question of fact on this issue. GEA Associates asserts that there is no evidence of a timely waiver by Metropolitan and that there is no evidence demonstrating that there is a material issue of disputed fact as to this issue. We agree with Metropolitan that this is a question of fact.

¶ 24. The record reveals the following facts. On April 17, 2002, Metropolitan notified GEA Associates that it had found three banks interested in financing the transaction, subject only to the receipt and approval of various documents in GEA Associates' possession. Metropolitan requested a one-week extension of the deadline to waive the financing contingency to allow for the exchange and review of the necessary documents. GEA Associates granted the extension, which resulted in April 25, 2002, as the final date on which Metropolitan had to waive its financing contingency.

¶ 25. On April 25, 2002, Metropolitan sent a letter to GEA Associates stating that: "This letter shall serve as Notice that the Buyer in the above referenced transaction has received a satisfactory loan commitment from Anchor Bank, FSB. If you have any questions regarding this please don't hesitate to call. We look forward to closing this transaction shortly." Metropolitan asserts that this letter constituted a waiver of the financing contingency. Metropolitan also points to affidavits, which attest to a May 1,2002 phone call between representatives of both sides confirming that the April 25th letter was intended to constitute a waiver of the contingency. Metropolitan also offers evidence of a lunch meeting, which occurred sometime in early May, wherein Genzel and Levins confirmed that the contingency was timely waived.

¶ 26. In addition, the record contains an April 29, 2002 letter from Levins to the limited partners of GEA Associates wherein she advises: "the only contingency remaining is acceptance of Metropolitan's offer by two thirds of the limited partners .... we chose to wait until all of their other contingencies were satisfied before recommending this transaction to our limited partners." (Emphasis added.)

¶ 27. Finally, on May 14, 2002, Genzel sent a letter to Levins confirming "that all of the contingencies on behalf of the Buyer have been satisfied and that Buyer is ready, willing and able to close the above-mentioned transaction."

¶ 28. GEA Associates argues that waiver did not occur timely. It contends that the April 25th letter cannot reasonably be interpreted to constitute a waiver of the financing contingency. As a result, it argues that any actions subsequent to the April 25th deadline are irrelevant because, according to the contract, the financing contingency waiver had to take place by that date or the contract was void.

¶ 29. In reviewing this series of events, we cannot conclude as a matter of law that waiver did or did not timely take place. The reason for this is that given the facts and circumstances as well as the conduct of the parties, a question of fact as to whether waiver occurred is presented. We conclude that after presentation of all of the evidence, a reasonable jury could determine that waiver timely occurred. Of course, a jury may also determine that waiver was untimely. This question, however, should be resolved by a fact finder and not this court. Therefore, we reverse the judgment and remand for further proceedings consistent with this opinion.

By the Court. — Judgment reversed and cause remanded.

       Henry S. Reuss, deceased, was also a general partner of GEA Associates until his death on January 12, 2002. The Henry S. Reuss Trust is his successor in interest.

       While these actions were pending, GEA Associates received a higher offer to purchase from a third party. As a result, GEA Associates entered into an agreement to pay Steadfast $200,000 to terminate that contract and went on to sell to the third party.

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

       The financing clause does not specify a particular lending institution but, even in the real estate line of cases, we have held that in certain circumstances, "the particular lending institution was not an essential term of the clause and it made no difference from whom the buyer obtained his loan." Gerruth Realty Co. v. Pire, 17 Wis. 2d 89, 93, 115 N.W.2d 557 (1962) (citing Kovarik v. Vesely, 3 Wis. 2d 573, 89 N.W.2d 279 (1958)).