author: N. PATRICK CROOKS, J. JON E WILCOX, J. DIANE S. SYKES, J.

text:
    Wolfgang Mau and Ena Mau, Plaintiffs-Appellants, v. North Dakota Insurance Reserve Fund, a corporation, Defendant, National Union Fire Insurance Company of Pittsburgh, Pennsylvania, a corporation, Defendant-Appellee.
    Supreme Court

      No. 00-1369-CQ.

      Oral argument September 13, 2001.

    Decided December 21, 2001.

    2001 WI 134
    (Also reported in 637 N.W.2d 45.)

      For the plaintiffs-appellants there were briefs by Duane A. Lillehaug and Lee Hagen Law Office, Ltd., Fargo, North Dakota, and Dana J. Weis and Habush, Habush, Davis & Rattier, Rhinelander, and oral argument by Dana J. Weis.

    For the defendant-appellee there was a brief by William P. Harrie and Nilles, Hansen & Davies, Ltd., Fargo, North Dakota, and Frank L. Steeves, Patrick L. Wells and Crivello, Carlson, Mentkowski & Steeves, S.C., Milwaukee, and oral argument by Patrick L. Wells.

   N. PATRICK CROOKS, J.

¶ 1. This case is before the court on certification from the Supreme Court of North Dakota pursuant to Wis. Stat. § 821.01 (1995-96). The parties dispute whether Wolfgang Mau is covered under an underinsured motorist policy. The specific question before the court is: Is Endorsement #1 in the International Extended Protection (IEP) Option valid under Wisconsin law to preclude underin-sured motorist coverage to one who rents a car from Alamo, purchases the IEP Option, and is injured while sitting in a different car? Based on our interpretation of language in the excess policy, we find that Mau is a named insured under the excess policy and that the occupancy requirement in Endorsement #1 is not valid under Wis. Stat. § 632.32.

I

¶ 2. The facts in this case are not in dispute. Wolfgang Mau and Dieter Jung (Jung), residents of Germany, arranged with a German travel agent to rent a car from Alamo Rent-A-Car, Inc. (Alamo) in Milwaukee, Wisconsin, for three weeks. Wolfgang Mau and Jung arrived in Milwaukee on April 4,1997, and rented the car from Alamo. The rental voucher specifically names "Mr. Mau/Wolfgang" as "Renter" and Wolfgang Mau signed the rental documents on the line indicated "Renters' Signature." After renting the car from Alamo, Wolfgang Mau and Jung began traveling west across the United States.

¶ 3. On April 5, 1997, due to slippery road conditions, Wolfgang Mau lost control of the rental car on 1-94 near Casselton, North Dakota. The rental car slid off the road and came to rest with its front wheels over the shoulder.

¶ 4. A Cass County deputy sheriff arrived at the scene and parked his squad car on the shoulder of the road, about thirty feet from the rental car. The deputy asked Wolfgang Mau and Jung to get into his patrol vehicle as he was helping them make arrangements to get the rental car pulled out. Jung sat in the front seat of the patrol car and Wolfgang Mau sat in the rear seat of the patrol car.

¶ 5. Shortly thereafter, Bette Mashburn (Mash-burn) was heading east on 1-94 and lost control of her vehicle. Mashburn's vehicle struck the patrol car, pinning Mau up against the security barrier between the front and rear seats of the patrol car. Wolfgang Mau suffered serious injuries.

¶ 6. Wolfgang Mau and his wife, Ena Mau, (hereafter collectively referred to as "Mau") settled the liability claim against Mashburn for her insurance policy limit of $100,000. Mau then sued the North Dakota Insurance Reserve Fund ("NDIRF"), which insured the patrol car, and National Union Fire Insurance Company of Pittsburgh (National Union), Alamo's insurer. The NDIRF coverage had underinsured motorist (UIM) policy limits of $1,000,000. Mau settled his claim against NDIRF for $715,000. The certified question in this case relates to Mau's continued claim for UIM coverage against National Union.

¶ 7. Information about Mau's insurance coverage was provided in the rental documents he received from Alamo, and in policies issued to Alamo by National Union. The Alamo rental voucher states:

THE FOLLOWING PRODUCTS, AS DESCRIBED IN THE RENTAL JACKET, ARE INCLUDED:
- EP WITH BODILY INJURY LIABILITY LIMIT AND UM LIMIT OF 1 MILLION

¶ 8. Under "TERMS FOR RENTING AN ALAMO CAR," the rental agreement provided:

Other Options:... Extended Protection (EP), ... and other such options are offered where permitted and are described and limited on the rental agreement jacket that I received from you and in any underlying policy.

The rental agreement jacket provided:

This is your Rental Agreement Jacket which contains important information about options you may purchase. The benefits are only as described in this Rental Agreement Jacket and in any underlying insurance policy covering the rental and are subject to the express terms and conditions of your Rental Agreement. Alamo offers no "full coverage" option.

LIABILITY INSURANCE SUPPLEMENT (LIS)

If LIS is purchased, you and authorized drivers are provided up to an aggregate single limit of $500,000 for claims that may be made by others against you or authorized drivers for bodily injury or death and/or property damage arising out of the use or operation of our rental car... .

UNINSURED MOTORIST (UM)

UM provides benefits to you and any family members up to an aggregate single limit of $100,000. These benefits are provided to you or any family member who, while physically occupying the Alamo rental car when it is being driven by you or an authorized driver, suffers bodily injury or death by a negligent motorist, a negligent underinsured motorist or a negligent hit and run driver.

EXTENDED PROTECTION (EP)

If purchased, EP provides ... UM protection as described above. EP does not include any additional UM coverage above $100,000, except to the extent, if any, required by state law, and you and Alamo reject such additional UM coverage to the extent permitted by law.
The purchase of ER LIS, and UM is entirely optional; no purchase is required in order to rent our car. The purchase is not an application for insurance. Alamo's policy is issued by National Fire Ins. Co. of Pittsburgh, PA ("National Union").

(Emphasis in original.)

¶ 9. Mau was covered under two policies in relation to the Alamo rental car: RMCA 1432406, the "Commercial Auto" policy ("the underlying policy"); and RMCA 1432440, an "Excess Auto Liability (IEP)" policy ("the excess policy"). Coverage under the excess policy was available to Mau because he purchased the International Extended Protection (IEP) Option.

¶ 10. The declarations page of the excess auto policy provides: "[T]his policy shall follow all the terms and conditions of Policy Number RMCA 1432440 .... NAMED INSURED: SEE ENDORSEMENT #1." Endorsement #1 states:

It is agreed Section II - LIABILITY COVERAGE, A. COVERAGE, 1. WHO IS AN INSURED of the Business Auto Coverage Form is amended to read:
1. Who Is An Insured
a. Only while occupying the Alamo rental vehicle, any rentee/lesee [sic] who purchases the International Extended Protection (IEP) Option, but only while the Alamo vehicle is being driven by the rentee/lessee or an "Alamo Authorized Additional Driver" and all terms and conditions of the Rental Agreement have been met.

¶ 11. Mau's claim against National Union is based on the underinsured motorist coverage provided by the excess policy. Mau had underinsured motorist coverage because, under the IEP Option, he was entitled to benefits for "bodily injury or death by ... a negligent underinsured motorist."

II

¶ 12. The Supreme Court of North Dakota asks this court to decide whether specific provisions of the excess policy are valid under Wisconsin law. Our understanding of the Supreme Court of North Dakota's certified question is whether, under Wisconsin law, an underinsured motorist policy can define a named insured by requiring occupancy of a specific vehicle. It is unclear, however, whether the Supreme Court of North Dakota is asking this court to assume that Mau is a named insured under the excess policy, or if the Supreme Court of North Dakota is asking this court to interpret the contract and decide if Mau is a named insured. To answer the certified question, therefore, we find that we must first decide whether Mau is a named insured by interpreting specific provisions of the excess policy. The interpretation of language in an insurance policy presents a question of law that we review de novo. Smith v. Atlantic Mut. Ins. Co., 155 Wis. 2d 808, 810, 456 N.W.2d 597 (1990).

¶ 13. We apply the same rules of construction to the language in an insurance policy as to the language in any other contract. Taylor v. Greatway Ins. Co., 2001 WI 93, ¶ 10, 245 Wis. 2d 134, 628 N.W.2d 916; Kremers-Urban Co. v. Am. Employers Ins. Co., 119 Wis. 2d 722, 735, 351 N.W.2d 156 (1984). The objective in interpreting and construing a contract is to carry out the true intention of the parties. Kremers-Urban, 119 Wis. 2d at 735. The language of an insurance policy is ambiguous when it is "susceptible to more than one reasonable construction." Smith, 155 Wis. 2d at 811. Whether ambiguity exists in a contract is a question of law. Kremers-Urban, 119 Wis. 2d at 735. We construe ambiguities in coverage in favor of the insured and narrowly construe exclusions in coverage against the insurer. Smith, 155 Wis. 2d at 811. The test is not what the insurer intended the words to mean, but what a reasonable person in the position of the insured would have understood the words to mean. Dowhower v. W. Bend Mut. Ins. Co., 2001 WI 73, ¶ 35, 236 Wis. 2d 113, 613 N.W.2d 557. However, when the language of the policy is plain and unambiguous, we will enforce the policy as written and not engage in construction. Danbeck v. Am. Family Mut. Ins. Co., 2001 WI 91, ¶ 10, 245 Wis. 2d 186, 629 N.W.2d 150.

¶ 14. The declarations page of the excess policy states, "NAMED INSURED: SEE ENDORSEMENT #1." Endorsement #1 defines "Who Is An Insured" by listing three definitions. The first definition potentially includes Mau, and therefore, is the only definition at issue.

¶ 15. Neither Mau nor National Union argue that Endorsement #1 to the excess policy is unambiguous and plain on its face. In fact, we find the excess policy is ambiguous in defining "named insured" because the language is susceptible to more than one reasonable construction. Mau contends the language in Endorsement #1 lists three definitions for named insured under the excess policy. In the alternative, National Union argues that Endorsement #l-does not define named insured, but merely amends the definition of insured in the underlying policy.

¶ 16. We find the excess policy ambiguous because it fails to clearly convey who is a named insured. The declarations page refers to the definitions in Endorsement #1 for defining "named insured;" however, the language in Endorsement #1 refers only to "insured." Furthermore, the amending language in Endorsement #1 amends "Section II - LIABILITY COVERAGE, A. COVERAGE, 1. WHO IS AN INSURED of the Business Auto Coverage Form." The difficulty, however, is that the excess policy does not contain a section entitled "Section II - LIABILITY COVERAGE." The amending language in Endorsement #1, therefore, on its face, refers to the underlying liability policy, not the excess policy.

¶ 17. Applying the canons of interpretation for insurance contracts, as noted previously, we interpret the policy based on what a reasonable person in the position of the insured would have understood the words to mean. Dowhower, 2000 WI 73, ¶ 35. Mau asserts that a reasonable insured would have understood he was a named insured under the excess policy, because he affirmatively decided to buy more insurance than Alamo provided with the standard rental agree-merit. Mau claims that by virtue of paying a fee for the excess policy, Mau is a named insured, rather than an occupancy insured. National Union argues that a reasonable insured would have understood that Mau is not a named insured, but that he is covered only as an "occupancy insured." Mau was covered under both the underlying liability policy and the excess policy, National Union contends, but only while occupying the Alamo rental car.

¶ 18. National Union makes two arguments in support of its position. First, relying on Meyer v. City of Amery, 185 Wis. 2d 537, 518 N.W.2d 296 (Ct. App. 1994), National Union contends that Mau is not a named insured because the definition of named insured in the underlying policy controls, and the underlying policy defines the named insured as Alamo, not Mau. Second, National Union argues that Mau did not purchase an insurance policy from Alamo. Mau's purchase of the IEP option meant only that the additional limits of the IEP option were available to Mau as an occupancy insured. We address each of these arguments in turn.

¶ 19. First, National Union argues that Meyer controls this case because the underlying policy unambiguously lists Alamo as the named insured. Because the excess policy was meant to follow the terms and conditions of the underlying policy, National Union contends that Mau is not a named insured under the excess policy. In Meyer, the court of appeals denied coverage for a police officer under a commercial fleet policy issued to the city. 185 Wis. 2d at 547. The officer was not a named insured under the policy because the policy unambiguously referred only to the city as the named insured. Id. at 544. The court of appeals concluded that finding the officer covered as a named insured would stretch the coverage of the commercial fleet policy and would essentially "rewrite the policy." Id. at 546 (quoting Ins. Co. of N. Am. v. Perry, 134 S.E.2d 418, 420 (Va. 1964)).

¶ 20. Justice Sykes' dissent also relies on the court of appeals decision in Meyer, but Meyer is not persuasive here because the fleet policy in Meyer did not involve the language of an endorsement altering the policy. In this case, the declarations page of the excess policy states, "NAMED INSURED: SEE ENDORSEMENT #1." Based on this language, a reasonable insured would rely on the definitions in Endorsement #1 to define named insured under the excess policy.

¶ 21. In Greene by Schoone v. General Casualty Co., 216 Wis. 2d 152, 576 N.W.2d 56 (Ct. App. 1997), the court of appeals determined the effect of an endorsement. The terms of a business auto policy were modified by an endorsement amending "WHO IS AN INSURED." 216 Wis. 2d at 158-159. The court of appeals concluded that the endorsement modified the policy to cover the persons listed in the endorsement as named additional interests. Id. at 159. The endorsement amended the policy language to provide coverage for the people listed in the endorsement. Id. Like the endorsement in Greene, here Endorsement #1 modified the excess policy by providing coverage to those who fall within the definitions in Endorsement #1. The plain language of the declarations page establishes that Endorsement #1 specifically defines who is a named insured. Anyone falling within the definitions in Endorsement #1, therefore, is covered as a named insured under the excess policy.

¶ 22. Second, National Union argues that although Mau purchased the IEP option, Mau was not purchasing an insurance contract covering him as a named insured. National Union contends that purchasing the IEP option means only that the additional limits of the IEP option were available to Mau as an occupancy insured.

¶ 23. To support its position, National Union relies on other cases involving rental cars. Specifically, National Union cites Canedy v. Liberty Mutual Insurance Co., 126 F.3d 100, 105 (2d Cir. 1997), rejecting the proposition that a rental car customer who requests liability insurance from a rental car company is a named insured. Canedy, however, does not apply to the facts of this case. The court in Canedy was faced with policy terms completely different from the terms in the National Union excess policy. Furthermore, Canedy focused on gratuitous coverage, not an excess policy for which the rental car customer paid an additional premium.

¶ 24. National Union also cites Wisconsin Court of Appeals cases that are likewise inapplicable. The court of appeals has addressed only limited issues relating to rental car agencies and insurance contracts. In Classified Insurance Co. v. Budget Rent-A-Car, 186 Wis. 2d 478, 483, 521 N.W.2d 177 (Ct. App. 1994), the court held that a rental car company, a self-insured

entity, is not statutorily required to provide or offer UM or UIM coverage under its rental agreements. See also Prophet v. Enter. Rent-A-Car Co., 2000 WI App 171, ¶ 18, 238 Wis. 2d 150, 617 N.W.2d 225 (no statute requires a self-insured entity to provide uninsured motorist coverage as part of optional insurance offered customers); Janikowski v. State Farm Mut. Auto. Ins. Co., 187 Wis. 2d 424, 429, 523 N.W.2d 130 (Ct. App. 1994) (out-of-state rental car agency not required to provide UM coverage). Because Mau is not claiming that Alamo was statutorily required to provide or offer UM or UIM coverage, Classified does not apply.

¶ 25. We reject National Union's arguments. We find that a reasonable person in the position of the insured would understand that the declarations page of the excess policy clearly instructs the reader to go to Endorsement #1 to determine who is a named insured. We now look to Endorsement #1 to determine if Mau falls within one of the definitions listed.

¶ 26. Endorsement #1 lays out three definitions for named insured. Mau falls under the first definition because the parties do not contest that Mau is a "rentee/lesee [sic] who purchases the International Extended (IEP) Option." Mau's name was designated as "renter" on the rental agreement and he signed the rental documents on the line indicated, "renter's signature." It is also undisputed that Mau requested and purchased the IEP option.

¶ 27. Based on our interpretation of the excess policy, we find that Mau falls within definition l.a. in Endorsement #1, which refers to a rentee/lessee who purchases an IEP Option, as Mau did in this case. Consequently, Mau is a named insured under the excess policy. We next turn to the occupancy requirement in the definition of named insured and determine the validity of this provision under Wisconsin law.

I — I h — i I — I

¶ 28. The Supreme Court of North Dakota specifically asks this court to determine the validity of the occupancy requirement in Endorsement #1 under Wis. Stat. § 632.32. Statutory interpretation is a question of law that we decide independently. Blazekovic v. City of Milwaukee, 2000 WI 41, ¶ 9, 234 Wis. 2d 587, 610 N.W.2d 467. The primary goal is to discern the intent of the legislature. Id.

¶ 29. Before we engage in statutory interpretation, we need to examine the excess policy at issue in this case, in relation to the omnibus statute, Wis. Stat. § 632.32. Mau's claim against National Union is for underinsured motorist coverage under the excess policy. Terms of the excess policy, as laid out in the Rental Agreement Jacket, provide benefits for "bodily injury or death by ... a negligent underinsured motorist." (emphasis supplied). The IEP option, therefore, provides Mau with underinsured motorist coverage.

¶ 30. To determine the validity of the occupancy requirement for underinsured motorist coverage, we look to Wis. Stat. § 632.32, which, except as otherwise provided, applies to all motor vehicle insurance policies issued or delivered in Wisconsin. Clark v. Am. Family Mut. Ins. Co., 218 Wis. 2d 169, 173, 577 N.W.2d 790 (1998). Some earlier cases suggest that certain provisions of § 632.32 apply only to liability policies, not indemnity insurance. See Martin v. Milwaukee Mut. Ins. Co., 146 Wis. 2d 759, 770, 433 N.W.2d 1 (1988); Peabody v. American Family Mut. Ins. Co., 220 Wis. 2d 340, 350, 582 N.W.2d 753 (Ct. App. 1998). However, the plain language of several subsections in § 632.32 demonstrate the applicability of those sections to indemnity insurance. See § 632.32(4) ("Required Uninsured Motorist ... Coverage[s]"); § 632.32(4m) ("Underinsured Motorist Coverage"); § 632.32(5)(g) ("uninsured or underin-sured motorist coverage"); § 632.32(5)(i) ("uninsured or underinsured motorist coverage"); § 632.32(5)(j) ("any coverage"). Furthermore, this court has applied § 632.32 to indemnity insurance. Blazekovic, 2000 WI 41, ¶ 42 (applying § 632.32(5)(j) to uninsured motorist coverage); see also Brunson v. Ward, 2001 WI 89, ¶ 24, 245 Wis. 2d 163, 629 N.W.2d 140 (applying § 632.32(4m)(d) to under-insured motorist policy); Dowhower, 2000 WI 73, ¶ 20 (applying § 632.32(5)(i)l to underinsured motorist coverage); Theis v. Midwest Sec. Ins. Co., 2000 WI 15, ¶ 39, 232 Wis. 2d 749, 606 N.W.2d 162 (applying § 632.32(4) to uninsured motorist coverage); Hull v. State Farm Mut. Auto. Ins. Co., 222 Wis. 2d 627, 648, 586 N.W.2d 863 (1998) (applying § 632.32(4) to uninsured motorist coverage); Clark v. Am. Family Mut. Ins. Co., 218 Wis. 2d 169, 173-175, 577 N.W.2d 790 (1998) (examining validity of territorial exclusion in uninsured motorist coverage under § 632.32(6)). The excess policy was both issued and delivered in Wisconsin; therefore, we are satisfied that it is appropriate to use the provisions in § 632.32, discussed herein, to determine the validity of the occupancy requirement for underinsured motorist coverage.

¶ 31. Since we have determined that Mau is a named insured, the issue now becomes whether defining a named insured by requiring occupancy of the Alamo vehicle is valid under Wis. Stat. § 632.32. We recognize that § 632.32 allows insurance companies to provide exclusions in automobile policies. See Wis. Stat. § 632.32(5)(e). In Clark, 218 Wis. 2d at 174, this court found § 632.32(5)(e) unambiguous. "[T]he [legislative] intent is to provide that an insurance contract may include exclusions not specifically listed in Wis. Stat. § 632.32(6) or prohibited by other applicable law." Id.

¶ 32. To determine the validity of the occupancy requirement, we follow the established two-part test. Blazekovic, 2000 WI 41, ¶ 12; Clark, 218 Wis. 2d at 174. First, we look to Wis. Stat. § 632.32(6) and decide whether the occupancy requirement fits the description of any of the enumerated prohibitions. Clark, 218 Wis. 2d at 174. If it does, the matter is resolved and the occupancy requirement is invalid. Blazekovic, 2000 WI 41, ¶ 13. If it does not, we examine any "other applicable law" that may prohibit the provision. Clark, 218 Wis. 2d at 174. Absent any other applicable law prohibiting the occupancy requirement, it remains valid. Blazekovic, 2000 WI 41, ¶ 13.

¶ 33. Before applying the two-part test, we recognize that the occupancy requirement in the excess policy is not couched as an exclusion. Although the occupancy requirement is part of the definition of named insured, for our analysis, we treat the definition the same as an exclusion. The purpose of the occupancy requirement is to exclude coverage for persons not occupying the Alamo rental car. The occupancy requirement, therefore, produces the same result as an exclusion. "To treat the definition differently from the exclusion merely because it is couched in the definition section of the policy would be to exalt form over substance. Rodey v. Stoner, 180 Wis. 2d 309, 313, 509 N.W.2d 316 (Ct. App. 1993).

¶ 34. Although Mau does not argue that the occupancy requirement falls within the enumerated prohibitions under Wis. Stat. § 632.32(6), we look closely at the prohibited provision in § 632.32(6)(b)2.a. Section 632.32(6)(b)2.a. prohibits an exclusion for "[a]ny person who is a named insured." We have already determined that Mau is a named insured under the excess policy. The occupancy requirement, if applied to Mau will exclude coverage for Mau, a named insured. Based on our analysis, we find that the occupancy requirement violates § 632.32(6)(b)2.a., because the occupancy requirement excludes coverage for a named insured. Our inquiry, however, does not end. Mau's argument centers on the second part of the test and focuses on why the occupancy requirement is invalid under other applicable law. Because we choose to address Mau's arguments, our analysis continues, to determine whether, in addition to § 632.32(6)(b)2.a., other applicable law prohibits the occupancy requirement.

¶ 35. Mau argues that the occupancy requirement violates Wis. Stat. § 632.32(5)(j) because it is a breed of "drive other car" exclusion. Blazekovic, 2000 WI 41, ¶ 28. Section 632.32(5)(j) states:

A policy may provide that any coverage under the policy does not apply to a loss resulting from the use of a motor vehicle that meets all of the following conditions:
1. Is owned by the named insured, or is owned by the named insured's spouse or a relative of the named insured if the spouse or relative resides in the same household as the named insured.
2. Is not described in the policy under which the claim is made.
3. Is not covered under the terms of the policy as a newly acquired or replacement motor vehicle.

¶ 36. In Blazekovic, 2000 WI 41, ¶¶ 15-22, «this court recently applied the two-part test and examined Wis. Stat. § 632.32(5)(j) as "other applicable law" prohibiting an exclusion. In Blazekovic, we found an endorsement excluding coverage when the insured was using "non-owned emergency type vehicles in connection with his or her employment, occupation, or profession" invalid as a "drive other car" exclusion. Id. at ¶ 3. We found that § 632.32(5)(j) applies to "drive other car" exclusions in the uninsured motorist context. Id. at ¶ 33. Furthermore, we held that a "drive other car" exclusion is valid only if it meets all three conditions listed in § 632.32(5)(j). Id. at ¶ 27. The first condition requires the exclusion be directed to a vehicle owned by the named insured. Wis. Stat. § 632.32(5)(j)1. Because the emergency vehicle endorsement was directed to a non-owned vehicle, the endorsement did not meet all three conditions in § 632.32(5)(j) and was an invalid "drive other car" exclusion. Id. at ¶ 42.

¶ 37. National Union argues Blazekovic is not controlling because the occupancy requirement is not a "drive other car" exclusion. National Union also repeats its arguments that Mau is not a named insured because he is not the owner of the vehicle or the purchaser of the policy. We disagree. As already decided above, Mau is a named insured under the excess policy. Furthermore, the occupancy requirement, while not couched in terms of an exclusion, is a "drive other car" exclusion because it has the effect of excluding coverage for a named insured not occupying the rental vehicle.

¶ 38. Applying Wis. Stat. § 632.32(5)(j) to Endorsement #1, we find that the occupancy requirement is invalid. Limiting coverage for a named insured "only while occupying the Alamo rental vehicle" amounts to a "drive other car" exclusion. And just like the emergency vehicle exclusion in Blazekovic, the occupancy requirement is directed to a non-owned vehicle. The occupancy requirement, therefore, fails the first condition of § 632.32(5)(j) and is invalid because it is a "drive other car" exclusion that fails to meet all three conditions in § 632.32(5)(j).

¶ 39. We do not address the remainder of the named insured definition in Endorsement #1 l.a., "only-while the Alamo vehicle is being driven by the rentee/lessee," because the occupancy requirement makes the definition invalid under Wisconsin law.

IV

¶ 40. We conclude that Mau is a named insured under the excess policy. Because it is unclear whether the Supreme Court of North Dakota had already decided if Mau was a named insured, we have interpreted relevant portions of the insurance contract to determine that Mau is a named insured. The declarations page and Endorsement #1 are ambiguous in defining named insured, because the policy is susceptible to more than one reasonable construction. Applying canons of interpretation, we find that the declarations page directs the reader to the definitions in Endorsement #1 to determine who is a named insured. Because it is undisputed that Mau is a "rentee/lessee who purchase[d] the . .. (IEP) Option," we hold that Mau is a named insured under Endorsement #1 to the excess policy.

¶ 41. Next, we have examined the question certified by the Supreme Court of North Dakota, specifically, the validity of the occupancy requirement. We conclude that the occupancy requirement violates both Wis. Stat. §§ 632.32(6)(b)2.a. and 632.32(5)(j). The occupancy requirement violates the prohibited provision in § 632.32(6)(b)2.a. because, if applied, the occupancy requirement excludes coverage for a named insured. The occupancy requirement also violates § 632.32(5)(j). The occupancy requirement has the same effect as a "drive other car" exclusion and, because it does not meet all three conditions of § 632.32(5)(j), the occupancy requirement is invalid under Wisconsin law.

¶ 42. Our answer to the certified question is definitive without going any further; therefore, there is no need to address additional arguments raised by the parties. Endorsement #1 in the excess policy is not valid under Wisconsin law in its attempt to preclude underinsured motorist coverage to Mau.

By the Court. — Question answered and cause remanded to the Supreme Court of North Dakota for further proceedings consistent with this opinion.

JON E WILCOX, J.

¶ 43. (dissenting). Although I join Justice Sykes' dissent, which would hold that Mau was an occupancy insured rather than a named insured under Wisconsin law, I write separately because I think the court should go on to decide the question of whether Mau was "occupying" the rental vehicle when the collision occurred.

¶ 44. Both the majority opinion and Justice Sykes' dissent conclude that the question of whether Mau was occupying the vehicle was not certified to this court. Majority op. at ¶ 42 n.18, Justice Sykes' dissent at ¶ 58 n.l. I do not read the certified question that way. In its certification to this court, the Supreme Court of North Dakota states:

[W]e respectfully certify the following question to the Wisconsin Supreme Court:
Is Endorsement #1 defining an "Insured" as "Only while occupying the Alamo rental vehicle, any rentee/lessee who purchases the International Extended Protection (IEP) Option, but only while the Alamo vehicle is being driven by the rentee/lessee" valid under Wisconsin law to preclude un-derinsured motorist coverage to one who rents a car from Alamo, purchases the IEP Option, and is injured while sitting in a different car?
We invite the justices of the Wisconsin Supreme Court to reformulate our question if they deem it appropriate. We do not intend anything in this certification to limit the scope of their inquiry. ...

Mau v. N.D. Ins. Reserve Fund, 610 N.W. 2d 761, 766-67 (N.D. 2000) (emphasis added). Earlier in its certification, the North Dakota court also notes "Mau has not shown he was occupying or using the rental car under Wisconsin law when he was injured." Id. at 766.

¶ 45. I do not read these sections as preventing us from reaching the occupancy question. Rather, I read them as recognizing that the question of whether Mau was an occupant of the insured vehicle has not been decided under Wisconsin law and is an integral part of what the Supreme Court of North Dakota has asked us to decide. Therefore, because I would find that Mau was an occupancy insured under the contract, I would also find it necessary to address the question of whether Mau was an occupant of the insured vehicle. I analyze this question now.

¶ 46. In the insurance contract at issue, "occupying" is defined as "in, upon, getting in, on, out of or off the rental vehicle" — a typical definition in insurance contracts. However, because this court has recognized that commonly used terms like "upon," "in" and "entering into or alighting from" may be ambiguous, Moherek v. Tucker, 69 Wis. 2d 41, 45-46, 230 N.W.2d 148 (1975), and because this language normally varies only slightly from contract to contract, Wisconsin courts have tended to apply a standardized meaning to the term "occupy."

¶ 47. In general, Wisconsin courts have tended to interpret the term "occupy" rather liberally. It is obvious that when a person is in the passenger compartment of a vehicle, that person is occupying it. However, we have held that in some cases, occupancy extends beyond the inside of the vehicle. In Wisconsin, " 'a person has not ceased "occupying" a vehicle until he has severed his connection with it — i.e., when he is on his own without any reference to it. If he is still vehicle-oriented, as opposed to highway oriented, he continues to "occupy" the vehicle.'" Id. at 47 (quoting State-Wide Ins. Co. v. Murdock, 254 N.E.2d 908 (N.Y. 1969)).

¶ 48. This court and the Wisconsin Court of Appeals have recognized that to be "vehicle-oriented," a person does not have to be inside, or even touching the vehicle. For instance, an individual can "occupy" a vehicle while waiting on the street corner to be picked up by the vehicle because that person is vehicle-oriented. Kreuser v. Heritage Mut. Ins. Co., 158 Wis. 2d 166, 169, 461 N.W.2d 806 (Ct. App. 1990). Similarly, a plaintiff who has exited the insured car and is injured when a second car hits the insured car and pushes it into the plaintiff is still vehicle-oriented and is therefore "occupying" the insured car under our rule. Sentry Ins. Co. v. Providence Wash. Ins. Co., 91 Wis. 2d 457, 458-61, 283 N.W.2d 455 (Ct. App. 1979). However, our cases have not pushed the definition of "vehicle-orientation" as far as Mau asks us to in this case.

¶ 49. I would hold that the limit of vehicle-orientation was reached here. Despite our generally liberal construction of the term "occupy," I would hold that Mau fell outside of our definition while he was sitting in the police vehicle. I would base this on the common-sense principle that a person cannot occupy two vehicles at the same time. When a person is sitting in one car, that person logically cannot be occupying another.

¶ 50. I am persuaded by the reasoning of the Rhode Island Supreme Court in General Accident Insurance Company of America v. D'Alessandro, 671 A.2d 1233 (R.I. 1996). The facts of DAlessandro, as they pertain to the occupancy question, are very similar to those in the present case. D'Alessandro's vehicle had broken down and she had pulled into the breakdown lane of the highway. A Rhode Island state police officer stopped to assist DAlessandro, parking his patrol vehicle behind her car. DAlessandro was waiting in the officer's patrol vehicle for a tow truck to arrive when another motorist collided with the police cruiser, injuring DAlessandro and the officer.

¶ 51. In the resultant lawsuit, the question arose of whether DAlessandro was "occupying" her own vehicle at the time of the collision. Despite the fact the Rhode Island court affords a liberal interpretation to the term "occupy", see, e.g., Gen. Accident Ins. Co. of Am. v. Olivier, 574 A.2d 1240, 1241 (R.I. 1990), the court held that DAlessandro was not occupying her car in this instance. The court held that it would be clearly impossible for DAlessandro to "occupy" two vehicles at the same time. D'Alessandro, 671 A.2d at 1235. 1 agree with this conclusion, and I find it applicable in this case.

¶ 52. Mau points out that many other jurisdictions have taken the same "liberal" approach to defining occupancy as we have in Wisconsin. See, e.g., Genther v. Progressive Cas. Ins. Co., 681 A.2d 479, 480 n.1 (Me. 1996) (listing cases in a number of jurisdictions that use a liberal definition of "occupy"). However, Mau is unable to show us a jurisdiction that has extended the definition of occupancy to include an individual sitting in another car, and I am not persuaded that we should be the jurisdiction that does so.

¶ 53. Therefore, in addition to finding that Mau is not a named insured, I would also reach the question of whether Mau was occupying the rental vehicle. In answering that question, I would hold that at the time of the collision, Mau did not occupy the vehicle for the purposes of the insurance contract.

¶ 54. For the foregoing reasons, I respectfully dissent.

DIANE S. SYKES, J.

¶ 55. (dissenting). The majority's invalidation of the occupancy restriction in the insurance policy in question in this case is based upon its conclusion that the plaintiff, Wolfgang Mau, is a "named insured" under the policy. I conclude that Mau is an occupancy insured, not a named insured.

¶ 56. Alamo Rent-A-Car, Inc. insured its fleet of rental cars with National Union Fire Insurance Company of Pittsburgh pursuant to a business auto insurance policy, which provided liability coverage, and a $1 million excess insurance policy, which provided, among other things, uninsured (UM) and underinsured (UIM) motorist coverage. Mau rented a car from Alamo in Milwaukee, and, as part of the transaction, elected to pay for the International Extended Protection (IEP) Option, which provided UM and UIM coverage under the excess policy. Mau seeks to recover the proceeds of the UIM policy as a result of injuries sustained in an accident in North Dakota.

¶ 57. The excess policy makes it clear that it provides coverage only to rental car customers who purchase the IEP Option, and only while they are "occupying the Alamo rental vehicle." The question certified by the North Dakota Supreme Court is whether the occupancy restriction in the National Union policy is valid under Wisconsin law. As the majority notes, the answer depends on whether Mau is a named insured under the excess policy.

¶ 58. The excess policy, by its terms, provides coverage "in accordance with the applicable insuring agreements, terms, conditions, and exclusions of the Underlying Policy #RMCA 1432406." The UM/UIM endorsement to the excess policy provides that "this endorsement modifies insurance provided under the following: RMCA 1432406." The Underlying Policy #1432406 is the business auto liability policy paid for by and issued to Alamo to insure its fleet of rental cars. The declarations page of that policy specifies Alamo as the named insured, and the policy also provides that "[t]hroughout this policy the words 'you' and 'your' refer to the Named Insured shown in the Declarations," that is, Alamo.

¶ 59. Endorsement #1 to the liability policy further specifies "WHO IS AN INSURED," and sets forth four categories of insureds: "you" (meaning Alamo, the named insured, pursuant to the above-cited language); and three categories of persons who are insured "only while occupying" the Alamo vehicle. The first two of these categories encompass persons who lease Alamo's rental cars, and the third pertains to Alamo's employees. Significantly, the endorsement does not say "who is a named insured"; the endorsement reiterates that the policy is issued to Alamo, and Alamo is listed on the declarations page as the named insured.

¶ 60. Endorsement #3 of the liability policy contains a lengthy listing of "Named Insureds," starting with Alamo, followed by a list of corporate entities apparently related to Alamo, as well as certain individuals apparently associated with Alamo's management. This endorsement does not include in its listing of named insureds persons who lease Alamo's rental cars. Endorsement #11 of the liability policy rejects UM/UIM coverage in states in which it is permissible to do so, and lists the applicable UM/UIM coverages in states which require it. This endorsement also contains similar occupancy restrictions as Endorsement #1 for purposes of the liability policy's UM/UIM endorsement.

¶ 61. The declarations page of the excess policy states "NAMED INSURED: SEE ENDORSEMENT #1" and "ADDRESS: SEE ENDORSEMENT #2." Endorsement #1 of the excess policy states that it is "[ijssued to Alamo Rent-A-Car, Inc.," and, following the language "Who Is An Insured," lists three categories of rentee/lessee insureds. The first of these is implicated here, and provides excess coverage to a rentee/lessee who purchases the IEP Option, but "[o]nly while occupying the Alamo rental vehicle." Endorsement #2 of the excess policy provides that "[i]t is agreed that Alamo Rent-A-Car, Inc. shall act on behalf of all persons and organizations insured under this policy with respect to all matters pertaining to the insurance afforded by this policy," but does not list an address.

¶ 62. The majority concludes that because the "Named Insured" line on the declarations page of the excess policy refers the reader to Endorsement #1 of the excess policy, all those listed as "insureds" in Endorsement #1 must necessarily be "named insureds." I disagree. Considering the excess policy and the underlying policy to which it relates as a whole, it is clear to me that one who leases a car from Alamo and elects to purchase the IEP Option does not acquire "named insured" status, but merely retains his "occupancy insured" status consistent with the underlying policy, but is entitled to the higher coverage limits of the excess policy.

¶ 63. Meyer v. City of Amery, 185 Wis. 2d 537, 518 N.W.2d 296 (Ct. App. 1994), supports this conclusion. In Meyer, the plaintiff, Mark Meyer, a City of Amery police officer, was injured in the line of duty by an uninsured motorist after having exited his squad car to investigate a complaint. The City's fleet of squad cars was insured by Wausau Insurance Company under a policy that specified the City as the named insured and persons "occupying" a covered auto as additional insureds. Meyer sought recovery of the policy's UM benefits.

¶ 64. The circuit court in Meyer awarded coverage, but the court of appeals reversed, noting that the City's policy with Wausau Insurance was a commercial fleet policy, and concluding that Meyer was an occupancy insured, not a named insured, under the policy. Id. at 544. The court of appeals further concluded that the policy language restricting the availability of UM coverage to the named insured and those injured while occupying a covered auto was not invalid under Wis. Stat. § 632.32(4), which requires auto insurance policies in this state to provide UM insurance in certain minimum amounts. Id. at 547.

¶ 65. The court of appeals in Meyer took particular note of the fact that courts have construed UM/UIM coverage to be "personal and portable" and available whether the insured is injured in relation to the covered automobile or otherwise. Id. at 545. The court then concluded that to find coverage under the policy and the statute "would result in each commercial fleet policy providing UM coverage to all of [the City's] employees and their families, whether they were injured in the course of their employment or in a situation completely unrelated to work. This is a result not intended by the contracting parties, nor the legislature." Id. at 547.

¶ 66. I reach a similar conclusion here. To interpret the policies in this case as providing "personal and portable" UM/UIM coverage to anyone who rents an Alamo rental car and elects the IEP option — that is, coverage for damages caused by uninsured or underin-sured motorists in situations completely unrelated to the use of the rental car — goes beyond what the parties obviously intended. Mau's election of the IEP option provided him with the increased coverages of the excess policy, but did not convert his status to that of a "named insured" under either the excess or the underlying liability policies.

¶ 67. The majority's conclusion that the occupancy restriction violates Wisconsin law depends upon its conclusion that Mau is a named insured under the excess policy. There is nothing in Wisconsin law that prohibits an occupancy restriction for those who are not named insureds. Because I conclude that Mau is an occupancy insured, not a named insured, I respectfully dissent.

¶ 68. T am authorized to state that Justices JON E WILCOX and ANN WALSH BRADLEY join this opinion.

       All subsequent references to the Wisconsin Statutes are to the 1995-1996 version unless otherwise indicated.

       "Relying on the declarations page and Endorsement #1 to the National Union excess policy, it may be argued Mau is a named insured under Wis. Stat. § 632.32(6)(b)(2)." Mau v. N.D. Ins. Reserve Fund, 610 N.W.2d 761, 766 (N.D. 2000).

       We recognize that, in the context of this case, we are not reviewing the interpretation of a lower court. We simply note, however, that the standard of review is the same.

       We recognize that the heading in Endorsement #1 states, "Issued to Alamo Rent-A-Car, Inc." However, rather than relying on the heading to determine who is a named insured, we look to the substance of Endorsement #1, the definitions, to define named insured.

       The language of the declarations page of the excess policy states: "[T]his policy shall follow all the terms and conditions of Policy Number RMCA 1432440 . ..." However, Policy Number RCMA1432440 is the policy number of the excess policy, not the underlying policy. The language of the excess policy itself states that it provides coverage "in accordance with the applicable insuring agreements, terms, conditions and exclusions of the Underlying Policy # RMCA 1432406." The UM/UIM endorsement to the excess policy provides that "this endorsement modifies insurance provided under the following: RMCA 1432406."

        Meyer v. City of Amery, 185 Wis. 2d 537, 518 N.W.2d 296 (Ct. App. 1994) is also not persuasive here because Meyer sought coverage under an underlying fleet policy naming the City of Amery as the named insured. 185 Wis. 2d at 544. In contrast, Mau is seeking coverage under an excess policy which does not identify Alamo as a named insured.

       We rely on the declarations page because in construing the contract, we must give meaning to all provisions in the insurance policy. See Maas v. Ziegler, 172 Wis. 2d 70, 80, 492 N.W.2d 621 (1992); see also Lee R. Russ & Thomas F. Segalla, Couch on Insurance 3d (12/95), § 21:19 ("All its words, parts, and provisions must be construed together as one entire contract, each part interpreted in the light of all the other parts, in connection with the risk or subject matter."). The declarations page is appropriately considered part of the insurance policy and accordingly, is interpreted as part of the policy. See Brunson v. Ward, 2001 WI 89, 245 Wis. 2d 163, 629 N.W.2d 140; Dowhower v. W. Bend Mut. Ins. Co., 2000 WI 73, ¶ 40,236 Wis. 2d 113, 613 N.W.2d 557 (Bradley, J., concurring). ("Arguably, the Declaration page is the most crucial section of the policy for the typical insured ..."); Petrowski v. Hawkeye-Sec. Ins. Co., 237 F.2d 609, 610 (7th Cir. 1956) ("All three documents, policy, declarations, and special endorsement, were stapled together and comprised one unit when issued.").

       In Canedy, the Second Circuit Court of Appeals specifically held that the rental car customer did not fall within the policy's definitions of "an insured." For purposes of UIM coverage, the policy defined "an insured" as:
      1. You.
      2. If you are an individual, any family member.
      3. Anyone else occupying a covered auto.
      4. Anyone for damages he or she is entitled to recover because of bodily injury sustained by another insured.

        Canedy v. Liberty Mut. Ins. Co., 126 F.3d 100, 103 (2d Cir. 1997).

       For the limited purpose of interpreting the insurance contract to determine if Mau is a named insured, we do not consider, now, the occupancy requirement. The validity of the occupancy requirement is the basis for the certified question and we consider the certified question, directly, in Part III.

       Mau is both the "renter" and "rentee" because the two terms have the same meaning. Black's Law Dictionary defines rentee as "A tenant." Black's Law Dictionary 1300 (7th ed. 1999). American Heritage Dictionary defines renter, "One who pays rent for the use of another's property; tenant." American Heritage Dictionary 1047 (2d College ed. 1985). It is undisputed that Mau rented the Alamo rental car; Mau is therefore, both a renter and a rentee.

       Justice Sykes' dissent claims that finding Mau is a named insured under the excess policy "goes beyond what the parties obviously intended" and that Mau's purchase of the excess policy merely provided him with "increased coverages." Dissent at ¶ 66. We disagree. We interpret the excess policy based on what a reasonable person in the position of the insured would understand who is a named insured. See Dowhower v. W. Bend Mut. Ins. Co., 2000 WI 73, ¶ 35, 236 Wis. 2d 113, 613 N.W.2d 557. Based on the language of the declarations page, viewed by a reasonable person in the position of the insured, we conclude that Endorsement #1 to the excess policy defines named insured and Mau is a named insured because he falls within the first definition.

       Although Endorsement #1 lists three definitions for named insured, we examine only the first, l.a., because it relates to Mau. Regardless, the occupancy requirement is identical in all three definitions.

       Liability coverage "requires the insurer to shield the insured from making payment on a claim for which the insured is liable." Blazekovic v. City of Milwaukee, 2000 WI 41, ¶ 38, 234 Wis. 2d 587, 610 N.W.2d 467. "In contrast, uninsured motorist coverage [indemnity coverage] seeks to compensate the insured after the insured has sustained an actual loss." Id. Similar to uninsured motorist coverage, underinsured motorist coverage is indemnity coverage.
      Here the distinction between liability and indemnity coverage does not change our conclusion as to the applicability of Wis. Stat. § 632.32. The excess policy falls within the scope of § 632.32 because it is a liability policy. Mau was covered under the excess policy because he bought the IEP Option. According to the rental jacket, "EP [Extended Protection] provides both LIS [Liability Insurance Supplement] and UM protection." The excess policy, therefore, is a liability policy with uninsured and underinsured motorist coverage.

       Wisconsin Stat. § 632.32(5)(e) states: A policy may provide for exclusions not prohibited by sub. (6) or other applicable law. Such exclusions are effective even if incidentally to their main purpose they exclude persons, uses or coverages that could not be directly excluded under sub. (6)(b).

       Wisconsin Stat. § 632.32(6) provides in full:

        PROHIBITED PROVISIONS.
      (a) No policy issued to a motor vehicle handler may exclude coverage upon any of its officers, agents or employes when any of them are using motor vehicles owned by customers doing business with the motor vehicle handler.
      (b) No policy may exclude from the coverage afforded or benefits provided:
      1. Persons related by blood or marriage to the insured.
      2. a. Any person who is a named insured or passenger in or on the insured vehicle, with respect to bodily injury, sickness or disease, including death resulting therefrom, to that person.
      b. This subdivision, as it relates to passengers, does not apply to a policy of insurance for a motorcycle as defined in s. 340.01(32) or a moped as defined in s. 340.01(29m) if the motorcycle or moped is designed to carry only one person and does not have a seat for any passenger.
      3. Any person while using the motor vehicle, solely for reasons of age, if the person is of an age authorized to drive a motor vehicle.
      4. Any use of the motor vehicle for unlawful purposes, or for transportation of liquor in violation of law, or while the driver is under the influence of an intoxicant or a controlled substance or controlled substance analog under ch. 961 or a combination thereof, under the influence of any other drug to a degree which renders him or her incapable of safely driving, or under the combined influence of an intoxicant and any other drug to a degree which renders him or her incapable of safely driving, or any use of the motor vehicle in a reckless manner. In this subdivision, "drug" has the meaning specified in s. 450.01(10).
      (c) No policy may limit the time for giving notice of any accident or casualty covered by the policy to less than 20 days.

       We do not look to or apply the phrase, "or passenger in or on the insured vehicle" in Wis. Stat. § 632.32(6)(b)2.a., because this phrase does not modify "named insured."

       The second and third conditions were not at issue because the emergency vehicle exclusion failed to meet the first condition.

       We disagree with Justice Wilcox's dissent and do not address whether Wolfgang Mau was occupying the vehicle. Furthermore, we do not address whether the excess policy contains an exhaustion clause or what, if any, impact Danbeck v. American Family Mutual Insurance Co., 2001 WI 91, 245 Wis. 2d 186, 629 N.W.2d 150, might have on this case.

       The Montana Supreme Court came to a similar conclusion in Chilberg v. Rose, 903 P.2d 1377, 1379 (Mont. 1995) ("Obviously, Chilberg can only 'occupy' one car at a time.").

       The parties briefed the question of whether Mau was legally "occupying" the rental car for insurance coverage purposes even though he was seated in the deputy sheriffs squad car at the time of the accident. The North Dakota Supreme Court, however, did not certify this question to us, and the court does not decide it. See, majority op. at ¶ 42 n.18.


source: Caselaw Access Project

author: FINE, J.

license: Public Domain

text:
    In re the Commitment of Isaac H. Williams: State of Wisconsin, Petitioner-Respondent, v. Isaac H. Williams, Respondent-Appellants. [Case No. 00-2899.] In re the Commitment of Willie Hogan: State of Wisconsin, Petitioner-Respondent, v. Willie Hogan, Respondent-Appellant.† [Case No. 00-3122.]
    Court of Appeals

      Nos. 00-2899, 00-3122.

      Submitted on briefs October 2, 2001.

      Decided October 23, 2001.

    2001 WI App 263
    (Also reported in 637 N.W.2d 791.)

      On behalf of the respondent-appellant, Isaac H. Williams, the cause was submitted on the brief of Donna L. Hintze, assistant state public defender of Madison.
    On behalf of the respondent-appellant, Willie Hogan, the cause was submitted on the briefs of Donald T. Lang, assistant state public defender of Madison.
    On behalf of the petitioner-respondent, the cause was submitted on the briefs of James E. Doyle, attorney general, and Diane M. Welsh, assistant attorney general.
    Before Wedemeyer, PJ., Fine and Curley, JJ.

       Petition to review filed.

   FINE, J.

¶ 1. Isaac H. Williams and Willie Hogan appeal separately from a judgment (Williams) and orders (Williams and Hogan) entered under Wis. Stat. ch. 980, committing them to institutional care pursuant to Wis. Stat. § 980.06 (1999-2000). Their appeals raise identical issues. Accordingly, we consolidate their appeals for decision. We affirm.

I.

¶ 2. Both Hogan and Williams contend that two changes made to Wis. Stat. ch. 980 violate their constitutional rights to equal protection and to substantive due process. They also claim that the changes should not be applied to them because the petitions alleging that they were sexually violent persons subject to chapter-980 commitment were filed before the effective date of the changes. Their complaints focus on Wis. Stat. §§ 980.06 and 980.08(1).

Wisconsin Stat. § 980.06 provides:

If a court or jury determines that the person who is the subject of a petition under s. 980.02 is a sexually violent person, the court shall order the person to be committed to the custody of the department for control, care and treatment until such time as the person is no longer a sexually violent person. A commitment order under this section shall specify that the person be placed in institutional care.

This section was amended into its present form by 1999 Wis. Act 9, § 3223h. It applies to commitment orders under Wis. Stat. ch. 980 on judgments entered on or after October 29, 1999. 1999 Wis. Act 9, § 9323(2)(ag). Placement in "institutional care" is at a "secure mental health unit or facility." Wis. Stat. § 980.065(2). Before the 1999 amendment, the circuit court was directed to determine whether someone found to be a sexually violent person should either be placed in a secure facility or be permitted supervised release. Wis. Stat. § 980.06(2)(b) (1997-1998) ("An order for commitment under this section shall specify either institutional care or supervised release.").

¶ 3. Wisconsin Stat. § 980.08(1) requires that a person committed as a sexually violent person must wait eighteen months before petitioning the court for supervised release, rather than the six-month period under the earlier version, Wis. Stat. § 980.08(1) (1997-1998). It was amended by 1999 Wis. Act 9, § 3232p, also applicable to commitment orders on judgments entered on or after October 29, 1999. 1999 Wis. Act 9, § 9323(2)(bg).

II.

¶ 4. As we pointed out in State v. Ransdell, 2001 WI App 202, constitutional challenges of statutes face a formidable task.

A person contending that a statute is unconstitutional has a heavy burden; he or she must establish beyond a reasonable doubt that the statute is constitutionally infirm, and we are required to give to the statute every reasonable presumption in favor of its validity. State v. Carpenter, 197 Wis. 2d 252, 263-264, 541 N.W.2d 105, 109 (1995), cert. denied sub nom. Schmidt v. Wisconsin, 521 U.S. 1118. Our review is de novo. State v. Post, 197 Wis. 2d 279, 301, 541 N.W.2d 115, 121 (1995), cert. denied, 521 U.S. 1118.

Ransdell, 2001 WI App 202 at ¶ 5 (footnote omitted). We discuss Williams's and Hogan's constitutional challenges in turn.

A. Substantive Due Process.

¶ 5. We have already upheld the automatic-commitment provision of Wis. Stat. § 980.06 against a substantive due-process challenge. Ransdell, 2001 WI App 202 at ¶¶ 5-10. So we turn to the requirement in Wis. Stat. § 980.08(1) that a person committed as a sexually violent person must wait eighteen months before being able to petition for supervised release.

¶ 6. As in Ransdell, application of the strict-scrutiny test is appropriate, given the liberty interests involved. Id., 2001 WI App 202 at ¶ 5. In order to survive a strict-scrutiny due-process analysis, the restriction must "further a compelling state interest and be narrowly tailored to serve that interest." Post, 197 Wis. 2d at 302, 541 N.W.2d at 122.

¶ 7. Wisconsin Stat. ch. 980 "advances two 'legitimate and compelling' state interests: 'to protect the community from the dangerously mentally disordered and to provide care and treatment to those with mental disorders that predispose them to sexual violence.'" Ransdell, 2001 WI App 202 at ¶ 7 (quoting from Post, 197 Wis. 2d at 302-303, 541 N.W.2d at 122). A key to our analysis of whether expansion of the initial waiting period from six months to eighteen months before someone committed as a sexually violent person to institutional care can formally petition for supervised release is that no one may be so committed unless he or she is found beyond a reasonable doubt to:

• have been previously convicted of a "sexually violent offense"; and
• be currently "dangerous because he or she suffers from a mental disorder that makes it substantially probable that the person will engage in acts of sexual violence."

Wis. Stat. § 980.01(7). Put another way, and in a phrase that is well-known in the law, albeit largely in other contexts, no one can be committed as a sexually violent person under chapter 980 unless he or she is a clear and present danger to others in society — shown not only by a prior conviction (or the equivalent) but also by a significant current risk to commit more crimes of sexual violence. Thus, as we pointed out in Ransdell, the initial mandatory commitment — "requiring that the person first undergo initial evaluation and initial treatment in an institutional setting before any decisions are made as to whether that person is suitable for supervised release" — directed by Wis. Stat. § 980.06, passes strict-scrutiny due-process muster. Ransdell 2001 WI App 202 at ¶ 8. We also believe that adding twelve months to the time before which a person committed as a sexually violent person can formally petition for supervised release similarly survives constitutional challenge.

¶ 8. Someone found to be a sexually violent person beyond a reasonable doubt is "committed to the custody" of the Department of Health and Family Services until he or she "is no longer a sexually violent person." Wis. Stat. § 980.06. As noted, the initial "commitment order" must "specify that the person be placed in institutional care." Id. Although someone committed as a sexually violent person must now wait eighteen months before formally petitioning the committing court to be placed in the community on supervised release, Wis. Stat. § 980.08(1), rather than the six-month period under the earlier version of that section, the committing court can always consider supervised release whenever the committed person seeks discharge, Wis. Stat. §§ 980.09(l)(c) and 980.09(2)(c), and the committed person may file an initial petition for discharge "at any time." Wis. Stat. § 980.10 (emphasis added). One of three things happens after the person files a petition for discharge:

• the person shall be discharged from custody if he or she petitions "the committing court for discharge," and the State does not carry its burden of "proving by clear and convincing evidence that the petitioner is still a sexually violent person." Wis. Stat. §§ 980.09(l)(a) and 980.09(l)(b).
• the person shall be placed on "supervised release" if the State carries its burden of proving by clear and convincing evidence that the person is still a sexually violent person, but the court determines, applying the criteria under Wis. Stat. § 980.08(4), that the State has not proven — again, by clear and convincing evidence — "that it is still substantially probable that the person will engage in acts of sexual violence if the person is not continued in institutional care," Wis. Stat. § 980.08(4).
• the person remains in institutional care if the State carries its dual burden of proving by clear and convincing evidence that the person is still a sexually violent person and that he or she will commit acts of sexual violence unless he or she is "continued in institutional care." Wis. Stat. § 980.08(4).

The Department must also "conduct an examination" of the "mental condition" of the committed person "within 6 months after an initial commitment under s. 980.06." Wis. Stat. § 980.07. The person being examined under § 980.07 must be told of his or her "right to petition the court for discharge over the secretary's objection." Wis. Stat. § 980.09(2)(a). Further, the committing court "may order a reexamination of the person at any time during the period in which the person is subject to the commitment order." Wis. Stat. § 980.07(3) (emphasis added).

¶ 9. In light of all the safeguards and alternative methods by which a person committed under Wis. Stat. ch. 980 can obtain supervised release, we cannot say that Hogan and Williams have carried their burden of showing beyond a reasonable doubt that the marginal impediment to supervised release created by the amendment to Wis. Stat. § 980.08(1) (1997-1998) violates their right to substantive due process because § 980.08(1) now requires an additional twelve months before they may formally file a petition for supervised release.

B. Equal Protection.

¶ 10. Williams and Hogan also contend that the automatic-commitment provision in Wis. Stat. § 980.06, and the eighteen-month waiting requirement in Wis. Stat. § 980.08(1) violate their rights to equal protection of the laws because they are treated more harshly than are "similarly situated" persons committed under either Wis. Stat. ch. 51 or Wis. Stat. § 971.17. Post recognized that persons committed under Wis. Stat. ch. 980 and those committed under chapter 51 are "similarly situated" for equal-protection analysis. Post, 197 Wis. 2d at 318-319, 541 N.W.2d at 129. We will also assume without deciding that persons committed under chapter 980 are similarly situated to those committed under § 971.17, inasmuch as a prerequisite to commitments under both those provisions is a determination that the committed person is dangerous. Cf. State v. White, 2000 WI App 147, ¶ 9, 237 Wis. 2d 699, 705-706, 615 N.W.2d 667, 671 (decisions under statutes regulating those relieved of criminal responsibility because of mental disease or defect are persuasive to analyses under chapter 980).

¶ 11. The level of scrutiny used to analyze whether statutory schemes that deprive persons of liberty interests violate equal protection is unclear. Post, 197 Wis. 2d at 319-321, 541 N.W.2d at 129-130. We, like Post, will use the "strict scrutiny" standard without deciding that its application is required. Id., 197 Wis. 2d at 321, 541 N.W.2d at 130. In the context of an equal-protection challenge, the strict-scrutiny test means that "the State must prove that the classification is necessary to promote a 'compelling governmental interest.1" State v. Hezzie R., 219 Wis. 2d 848, 894, 580 N.W.2d 660, 677 (1998) (quoting from Post, 197 Wis. 2d at 319, 541 N.W.2d at 129). This does not mean, however, that there must be total congruence in the treatment of those who are similarly situated: "Equal protection does not require that all persons be dealt with identically, but it does require that a distinction made have some relevance to the purpose for which the classification is made." Post, 197 Wis. 2d at 321, 541 N.W.2d at 130 (quoted source omitted). Among the factors that will justify disparate approaches in the context of a case arising under Wis. Stat. ch. 980, are "[d]ifferences in difficulty of diagnosis, degree of dangerousness, and intrusiveness of treatment." Id., 197 Wis. 2d at 322, 541 N.W.2d at 130. As we noted in Part A of this opinion, and as we explained in Ransdell in the context of a due-process analysis, the legislature has determined that those found to be sexually violent persons beyond a reasonable doubt under chapter 980 must "first undergo initial evaluation and initial treatment in an institutional setting before any decisions are made as to whether that person is suitable for supervised release," and that this is within the ambit of permitted legislative response to the profound risk to the public safety presented by sexually violent persons. Ransdell, 2001 WI App 202 at ¶ 8. We examine the equal-protection contentions asserted by Williams and Hogan against this background.

1. Wis. Stat. ch. 51.

¶ 12. Hogan and Williams point to the following to support their claim that those persons committed under Wis. Stat. ch. 51 are treated more leniently than those committed under Wis. Stat. ch. 980: (1) residents of Wisconsin are permitted initial outpatient treatment, if appropriate, Wis. Stat. § 51.20(13)(a), and (2) any "first order of commitment" may not exceed six months, Wis. Stat. § 51.20(13)(g)l.

¶ 13. A person may be committed under Wis. Stat. ch. 51 if he or she is dangerous to others. Wis. Stat. § 51.20(l)(a)2.b. But, commitments under chapter 51 are also permitted for many reasons that do not implicate danger to others. Wis. Stat. § 51.20(l)(a)2.a., c.-e. In contrast, significant danger to others is the only justification for a commitment under Wis. Stat. ch. 980. Thus, persons committed under Wis. Stat. ch. 980 are more dangerous as a class than those committed under chapter 51. Post, 197 Wis. 2d at 322, 541 N.W.2d at 130 ("The legislature has determined that, as a class, persons predisposed to sexual violence are more likely to pose a higher level of danger to the community than do other classes of mentally ill or mentally disabled persons.").

¶ 14. Additionally, it is much more difficult to commit a person under Wis. Stat. ch. 980 than it is to commit someone under chapter 51. First, the burden of proof under chapter 51 is "clear and convincing evidence," Wis. Stat. § 51.20(13)(e). The burden of proof for an initial commitment under chapter 980 is "beyond a reasonable doubt." Wis. Stat. § 980.05(3). Second, a person against whom a chapter-980 petition has been filed has the right to a trial by a jury of twelve, all of whom must agree that he or she is a sexually violent person. Wis. Stat. §§ 980.03(3) and 980.05(2). On the other hand, a person may be committed under chapter 51 by a jury of six, and only five of the six need to agree to commit. Wis. Stat. §§ 51.20(ll)(a) and 51.20(ll)(b).

¶ 15. Finally, a person may be committed under Wis. Stat. ch. 51 because he or she is a danger to others even though the factual predicates to that commitment may represent the first time that he or she has done something that "[e]vidences a substantial probability of physical harm to other individuals." Wis. Stat. § 51.20(l)(a)2.b. On the other hand, a person committed under Wis. Stat. ch. 980 has, by definition, not only already violated the rights of at least one victim by an act or acts of sexual violence, but, significantly, has also demonstrated that "previous treatment has proved ineffective." Post, 197 Wis. 2d at 309, 541 N.W.2d at 125.

¶ 16. Although Wis. Stat. ch. 51 is more "lenient" with those who are subject to its provisions than is Wis. Stat. ch. 980, the significant differences between the degree of danger posed by each of the two classes of persons, as well as the differences in what must be proven in order to commit under the two chapters, justify on a strict-scrutiny analysis the disparate, but narrowly tailored, procedures about which Hogan and Williams complain. See Post, 197 Wis. 2d at 322-323, 541 N.W.2d at 130 ("This heightened level of dangerousness and the unique treatment needs of sexually violent persons justify distinct legislative approaches to further the compelling governmental purpose of protection of the public.").

2. Wis. Stat. § 971.17.

¶ 17. Hogan and Williams also complain that the automatic commitment required by Wis. Stat. § 980.06 deprives them of equal protection of the laws because persons who have been acquitted by reason of mental disease or defect are entitled to an expedited hearing to determine whether they should be kept in "institutional care" or given "conditional release," by virtue of Wis. Stat. §§ 971.17(2) and 971.17(3). The problem with their attempted analogy, however, is that the law only infers current mental illness and dangerousness when a person is found to have violated the criminal law but to be not responsible for that violation because he or she had a mental disease or defect at the time. See Wis. Stat. § 971.15(1) ("A person is not responsible for criminal conduct if at the time of such conduct as a result of mental disease or defect the person lacked substantial capacity either to appreciate the wrongfulness of his or her conduct or conform his or her conduct to the requirements of law."); State v. Field, 118 Wis. 2d 269, 277-278, 347 N.W.2d 365, 369-370 (1984) (fact that person is found beyond a reasonable doubt to have committed a criminal act "indicates dangerousness," and "the insanity acquittal supports an inference of continuing mental illness") (emphasis added) (interpreting decision of the United States Supreme Court).

¶ 18. In contrast to the inferences that an acquittal by reason of mental disease or defect permits about the person's current mental state and current dangerousness, a person may not be committed under Wis. Stat. ch. 980 unless the State proves beyond a reasonable doubt both that the person actually "has a mental disorder" at the time of the trial on the petition for commitment, and is then actually "dangerous to others because the person's mental disorder creates a substantial probability that he or she will engage in acts of sexual violence." Wis. Stat. §§ 980.02(2)(b), 980.02(2)(c), and 908.05(3)(a). See also State v. Carpenter, 197 Wis. 2d 252, 274, 541 N.W.2d 105, 113 (1995) ("The legislative aim is not punishment but regulation of a present situation."). This is a critical distinction between the classes of persons committed under Wis. Stat. § 971.17 and those committed under chapter 980, and reflects the legislature's judgment that sexually violent persons, as a class, are substantially more dangerous than those subject to the procedures in § 971.17. Thus, those who have "been found not guilty of or not responsible for a sexually violent offense by reason of insanity or mental disease" are subject to the more stringent levels of control and treatment under chapter 980. Wis. Stat. § 980.01(7).

¶ 19. Additionally, although a person committed under Wis. Stat. § 971.17(4) has the right, to petition for "conditional release if at least 6 months have elapsed since the initial commitment order was entered," and, as noted, a person committed under Wis. Stat. ch. 980 must wait eighteen months before formally petitioning for supervised release, we have set out in the due-process portion of this opinion the plethora of protections and alternate routes to supervised release that are available to a person committed under chapter 980, not the least of which is being able to petition for discharge at any time without the approval of the secretary of the Department of Health and Family Services. See ¶¶ 7-9, supra. As also noted, the court may consider supervised release in connection with any petition for discharge. See ¶ 8, supra.

¶ 20. The differences in the procedures for initial commitment between Wis. Stat. ch. 980 and Wis. Stat. § 971.17 are based on real distinctions between the two statutory schemes and the interests served by each. On a strict-scrutiny analysis, the equal-protection rights of Hogan and Williams have not been violated by their automatic commitment under Wis. Stat. § 980.06 or by making them wait eighteen months before formally petitioning for supervised release.

C. Retroactivity.

¶ 21. Williams and Hogan assert that the automatic-commitment provision of Wis. Stat. § 980.06, and the eighteen-month period in § 980.08(1) deprive them of the procedures in effect when the petitions seeking their commitment under Wis. Stat. ch. 980 were filed. They rely principally on Martin v. Richards, 192 Wis. 2d 156, 531 N.W.2d 70 (1995), and Neiman v. American National Property and Casualty Co., 2000 WI 83, 236 Wis. 2d 411, 613 N.W.2d 160, which held that the legislature's attempt to reduce (Martin) or increase (Neiman) damage-caps in tort cases where the claims had already accrued violated due process. Martin, 192 Wis. 2d at 199, 531 N.W.2d at 88; Neiman, 2000 WI 83 at ¶¶ 1-2, 8-31. Due process is not implicated, however, unless the changes are, in fact, retroactive. Martin, 192 Wis. 2d at 199, 531 N.W.2d at 88.

¶ 22. Here, as with Wis. Stat. ch. 980 generally, the changes about which Hogan and Williams complain are not retroactive; they are not designed to punish past acts, but, rather to treat those who are currently sexually violent persons. See Carpenter, 197 Wis. 2d at 274, 541 N.W.2d at 113 ("[T]he mere fact that a prior conviction is a predicate of the current sanction does not render the current sanction punishment for the past offense. The legislative aim is not punishment but regulation of a present situation.") (internal citation omitted; analyzing challenge that chapter 980 was an unlawful ex post facto act). Indeed, the very language of Wis. Stat. § 980.06 is clear that automatic commitment is not triggered unless and until there is the requisite finding about the person's current condition: "If a court or jury determines that the person who is the subject of a petition under s. 980.02 is a sexually violent person, the court shall order the person to be committed . . . [and] placed in institutional care." (Emphasis added.) Thus, § 980.06 is not retroactive because it "first applies to initial commitment orders in cases in which judgment is entered under section 980.05(5) of the statutes on" October 29, 1999. 1999 Wis. Act 9, § 9323(2)(ag).

¶ 23. The petition alleging that Hogan was a sexually violent person was filed in May of 1998. This was before the October 29, 1999, effective date of the new provisions. His trial, however, was in April of 2000, well after their effective date. Similarly, the petition alleging that Williams was a sexually violent person was filed in February of 1998. His trial in March of 2000 was also well after the effective date of the provisions. Thus, the determinations that triggered the applicability of the treatment facilitating provisions in Wis. Stat. §§ 980.06 and 980.08(1) to both Hogan and Williams came after the date of the sections initial applicability; it was then, and not before, that they were proven to be sexually violent persons subject to chapter 980. The sections are not being applied retroactively to them.

III.

¶ 24. For the reasons set out above, we conclude that application of Wis. Stat. §§ 980.06 and 980.08(1) to Hogan and Williams does not violate their rights to substantive due process or to equal protection of the laws. Accordingly, we affirm the trial courts in these matters, and also reject Hogan's request that his commitment under Wis. Stat. ch. "be vacated," inasmuch as that request is predicated on his contention that application of §§ 980.06 and 980.08(1) to him are unconstitutional.

By the Court. — Judgment and orders affirmed.

       Unless otherwise noted, all references to the provisions of Wis. Stat. ch. 980 are to the 1999-2000 edition of the Wisconsin Statutes.

       The "Department” is the Department of Health and Family Services. Wis. Stat. § 980.01(1).

       The "conviction" may also be the result of either a juvenile delinquency adjudication or a finding of criminal non-responsibility under Wis. Stat. §§ 971.15 and 971.165. Wis. Stat. § 980.01(7). Section 980.01(7) provides in full:
      "Sexually violent person" means a person who has been convicted of a sexually violent offense, has been adjudicated delinquent for a sexually violent offense, or has been found not guilty of or not responsible for a sexually violent offense by reason of insanity or mental disease, defect or illness, and who is dangerous because he or she suffers from a mental disorder that makes it substantially probable that the person will engage in acts of sexual violence.

       The phrase "clear and present danger" was, apparently first used by Justice Oliver Wendell Holmes, Jr., in Schenck v. United States, 249 U.S. 47, 52 (1919), which upheld a conviction under the Federal Espionage Act of 1917, 40 Stat. 217, for sending anti-war leaflets to men who had been conscripted into the armed forces of the United States during World War I. Id., 249 U.S. at 48-49, 50-51. It has also been used outside of the First-Amendment context to describe the threat posed to society by some criminals. See Martinez v. California, 444 U.S. 277, 279-280, 283 (1980) (upholding the statutory immunity of admittedly grossly negligent parole officials who improperly paroled a man committed to a state mental hospital as a " 'Mentally Disordered Sex Offender not amenable to treatment'" who later brutally tortured, raped, and murdered a fifteen-year-old girl; assuming for the decision that the officials either knew of should have known that release of the man "created a clear and present danger" that he would do what he did).

       Wisconsin Stat. §§ 980.09(1) (c) and 980.09(2) (c) are identical and they read in full:
      If the court is satisfied that the state has not met its burden of proof under par. (b), the petitioner shall he discharged from the custody or supervision of the department. If the court is satisfied that the state has met its burden of proof under par. (b), the court may proceed to determine, using the criterion specified in s. 980.08(4), whether to modify the petitioner's existing commitment order by authorizing supervised release.
      Wisconsin Stat. § 980.10 reads in full:
      Additional discharge petitions. In addition to the procedures under s. 980.09, a committed person may petition the committing court for discharge at any time, but if a person has previously filed a petition for discharge without the secretary's approval and the court determined, either upon review of the petition or following a hearing, that the person's petition was frivolous or that the person was still a sexually violent person, then the court shall deny any subsequent petition under this section without a hearing unless the petition contains facts upon which a court could find that the condition of the person had so changed that a hearing was warranted. If the court finds that a hearing is warranted, the court shall set a probable cause hearing in accordance with s. 980.09(2)(a) and continue proceedings under s. 980.09(2)(b), if appropriate. If the person has not previously filed a petition for discharge without the secretary's approval, the court shall set a probable cause hearing in accordance with s. 980.09(2)(a) and continue proceedings under s. 980.09(2)(b), if appropriate.

       Wisconsin Stat. § 980.09 is divided into two parallel subsections: (1) and (2). Section 980.09(1) applies when the secretary of the Department of Health and Family Services determines that someone committed as a sexually violent person "is no longer a sexually violent person." Wis. Stat. § 980.09(l)(a). The secretary then "shall authorize the person to petition the committing court for discharge." Id. Section 980.09(2) permits the committed person to seek discharge "without the secretary's approval." Wis. Stat. § 980.09(2)(a). In either event, as noted in the main body of this opinion, the State must prove to the committing court's satisfaction by clear and convincing evidence that the person is both: still a sexually violent person and still in need of continued institutional care before the committing court may retain the person in institutional care.

       Wisconsin Stat. § 980.07 reads in full:
      Periodic reexamination; report. (1) If a person has been committed under s. 980.06 and has not been discharged under s. 980.09, the department shall conduct an examination of his or her mental condition within 6 months after an initial commitment under s. 980.06 and again thereafter at least once each 12 months for the purpose of determining whether the person has made sufficient progress for the court to consider whether the person should he placed on supervised release or discharged. At the time of a reexamination under this section, the person who has been committed may retain or seek to have the court appoint an examiner as provided under s. 980.03(4).
      (2) Any examiner conducting an examination under this section shall prepare a written report of the examination no later than 30 days after the date of the examination. The examiner shall place a copy of the report in the person's medical records and shall provide a copy of the report to the court that committed the person under s. 980.06.
      (3) Notwithstanding sub. (1), the court that committed a person under s. 980.06 may order a reexamination of the person at any time during the period in which the person is subject to the commitment order.

       Wisconsin Stat. § 980.05(5) provides, as material: "If the court or jury determines that the person who is the subject of a petition under s. 980.02 is a sexually violent person, the court shall enter a judgment on that finding and shall commit the person as provided under s. -980.06." (Emphasis added.)

       We express no opinion about a situation where a determination that subjects a person to the procedures of Wis. Stat. ch. 980 is made before the initial applicability of a change in those procedures but the judgment is entered after that date, and the act sets entry of the "judgment" as the critical date, as does 1999 Wis. Act 9 here.


author: HOOVER, PJ.

text:
    Lynn Wonka and Jerome Wonka, Plaintiffs-Appellants, v. Samuel Cari, Special Administrator of the Estate of Edward E. Bierbrauer, and Donna Bierbrauer, Defendants-Respondents.
    Court of Appeals

      No. 01-0184.

      Submitted on briefs September 17, 2001.

    Decided October 23, 2001.

    2001 WI App 274
    (Also reported in 637 N.W.2d 92.)

      On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Charles B. Harris and Martha H. Heidt and Doar, Drill & Skow, S.C. of Baldwin.
    On behalf of the defendants-respondents, the cause was submitted on the brief of R. Michael Waterman and Mudge, Porter, Lundeen & Seguin, S.C. of Hudson.
    Before Cane, C.J., Hoover, PJ., Peterson, J.
   HOOVER, PJ.

¶ 1. Lynn and Jerome Wonka appeal a summary judgment dismissing their claims against the proceeds from the sale of real estate of the Estate of Edward Bierbrauer. The Wonkas argue that Edward and Donna Bierbrauer held the property as marital property without survivorship rights until Edward's death. They argue further that Edward's portion of the proceeds was available to satisfy a judgment for damages from a tort claim against him that resulted from an auto accident. Donna and the special administrator of Edward's estate contend that at all times the Bierbrauers held the property as survivorship marital property. We agree. Ownership of the property appropriately passed to Donna upon Edward's death, and she is entitled to all proceeds from its sale. We affirm the trial court's judgment.

Background

¶ 2. In 1976, Edward and Donna acquired an interest in the Boardman Bar by way of a land contract. The land contract conveyed the real property to "Edward E. Bierbrauer and Donna K. Bierbrauer, husband and wife as joint tenants." Edward and Donna satisfied the land contract in 1991, and the seller conveyed the warranty deed to the Bierbrauers as "husband and wife, as marital property with rights of survivorship."

¶ 3. In 1996, Edward Bierbrauer and Lynn Wonka were involved in an automobile accident. The Wonkas filed a personal injury action in April 1998, alleging that Edward negligently caused the accident. Donna Bier-brauer was not involved in the accident and was not named as a defendant.

¶ 4. Early in 1997, the Bierbrauers entered into a land contract with Lloyd and Ann Anderson for the sale of the Boardman Bar. The Andersons defaulted on the land contract. Six months later, in lieu of foreclosure, the Andersons conveyed their interest in the Boardman Bar back to the Bierbrauers as "husband and wife" by way of a quitclaim deed.

¶ 5. Edward passed away in 1999, and the trial court appointed a special administrator of his estate. The Wonkas continued the suit against Edward's one-half interest in the Boardman Bar.

¶ 6. After Edward's death, Donna filed a "Termination of Decedent's Property Interest" to terminate Edward's interest in the Boardman Bar. The Wonkas then amended their complaint to allege that the property was not survivorship marital property. They claimed that any judgment awarded to them could be satisfied from Edward's interest in the property. Donna and the Estate moved for summary judgment to determine whether the Bierbrauers held the property as survivorship or non-survivorship property.

¶ 7. Subsequently, the Boardman Bar was sold and, pursuant to stipulation, the portion of the proceeds attributable to Edward's interest was held in trust. The parties stipulated that all of the Wonkas' claims were dismissed except for issues surrounding the Wonkas' alleged interest in the money in the trust. The parties agreed to the distribution of the trust money upon the trial court's resolution of the legal issue. In the event the trial court determined that the Boardman Bar was survivorship marital property, the parties stipulated that the sum held in trust would be paid to Donna. In the event it determined the Boardman Bar was owned as non-survivorship marital property at the time of Edward's death, the parties stipulated the sum held in trust would be paid to the Wonkas. The trial court signed the order approving the stipulation.

¶ 8. On December 5, 2000, the trial court granted summary judgment in favor of Donna and the Estate. It concluded that the Bierbrauers held the Boardman Bar as survivorship marital property until Edward's death and that the plaintiffs have no interest in the proceeds from the property's sale. The Wonkas now appeal.

Standard op Review

¶ 9. We review summary judgment dispositions de novo and apply the same methodology used in the trial court. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315, 401 N.W.2d 816 (1987). Summary judgment is granted only when pleadings, depositions, interrogatories, admissions and affidavits show that there is no genuine issue as to any material fact. Wis. Stat. § 802.08(2). When examining material presented, we view all inferences to be drawn from the underlying facts in the light most favorable to the party opposing the summary judgment motion. Kraemer Bros. v. United States Fire Ins. Co., 89 Wis. 2d 555, 567, 278 N.W.2d 857 (1979).

Discussion

¶ 10. The Wonkas argue that, at the time of Edward's death, the Boardman Bar was not survivor-ship marital property, the 1997 land contract having severed the Bierbrauers' joint tenancy. The Wonkas further contend that the quitclaim deed did not convey a survivorship interest from the Andersons back to the Bierbrauers. We disagree because the land contract transferred only equitable title to the Andersons. We conclude that the Bierbrauers at all times retained legal title to the property as survivorship marital property. Therefore, we affirm the trial court's summary judgment.

¶ 11. When a tortfeasor spouse dies, property that would have been available for satisfaction of the incurred obligation generally continues to be available. Wis. Stat. § 859.18(2). Survivorship marital property, however, is not available to satisfy the obligation of the deceased tortfeasor spouse. Wis. Stat. § 859.18(4)(a)l. Whether the Wonkas can access Edward's interest in the sale proceeds to satisfy tort judgments against him turns on whether the Bierbrauers held the Boardman Bar as survivorship marital property at the time of Edward's death.

¶ 12. Once survivorship rights are created, they remain with the titleholders until an act or event severs the joint tenancy. See Nichols v. Nichols, 43 Wis. 2d 346, 349-50, 168 N.W.2d 876 (1969). The Bierbrauers established survivorship right's when the 1991 warranty deed vested title "with rights of survivorship."

¶ 13. In a land contract, the vendor holds legal title, while the vendee obtains equitable title. City of Milwaukee v. Greenberg, 163 Wis. 2d 28, 39, 471 N.W.2d 33 (1991). Here, then, the land contract conveyed to the Andersons equitable title in the Boardman Bar. In Simon v. Chartier, 250 Wis. 642, 645, 27 N.W.2d 752 (1947), our supreme court expressly held that executing a land contract does not constitute severance of a joint estate. Therefore, when the Bierbrauers signed the land contract with the Andersons, they did not sever their joint tenancy with rights of survivorship. See id. As long as the Bierbrauers held the legal title, the way in which they held that title remained intact.

¶ 14. "The unexercised power to sell or convey a joint tenancy interest does not sever the joint tenancy; a consummated sale or conveyance does." Nichols, 43 Wis. 2d at 350. Because the Andersons did not satisfy the 1997 land contract, no sale was ever consummated. Consequently, the Bierbrauers' joint tenancy was never severed.

¶ 15. The Wonkas view the quitclaim deed as creating new rights, ignoring that, under the land contract, the Bierbrauers retained legal title with sur-vivorship interests. The 1997 quitclaim deed in lieu of foreclosure could not destroy the rights of survivorship because it conveyed only the equitable interests the Andersons had under the land contract. Wis. Stat. § 706.10(4). The Andersons could not convey what they did not own. They did not own legal title. Termination of rights under a land contract (via a quitclaim deed in lieu of foreclosure) puts the vendors back in the same position they were in prior to the execution of the land contract. See Simon, 250 Wis. 2d at 645.

¶ 16. This case is not about the creation of survi-vorship rights. It is about the preservation of existing rights. If the Bierbrauers had no legal interest in the Boardman Bar, the quitclaim deed would have been insufficient to create survivorship rights. However, it was unnecessary for the quitclaim deed to create sur-vivorship rights because the Bierbrauers retained legal title in that form when they entered into the land contract with the Andersons and conveyed an equitable interest in the property.

¶ 17. The Wonkas argue that other jurisdictions terminate survivorship rights when a land contract is executed. That, however, is inconsequential. Wisconsin is one of the few states to follow the minority rule that survivorship rights are not extinguished. See id. at 645.

¶ 18. In summary, the Bierbrauers always retained legal title to the property, which was held as survivorship marital property. When the quitclaim deed in lieu of foreclosure terminated the land contract between the Andersons and the Bierbrauers, it merely returned to the Bierbrauers the equitable title under the land contract. The quitclaim deed merely returned the Bierbrauers to the same position they were in before the land contract transaction with the Ander-sons.

By the Court. — Judgment affirmed.

       All references are to the 1999-2000 Wisconsin Statutes unless otherwise noted.