Legal Action Program Advocacy

Protecting real estate professionals and property owners


 Debbi Conrad  |    September 11, 2014
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The Legal Action Program was established in 1978 to support REALTORS¬ģ and property owners involved in legal matters that have significance for the WRA membership and the real estate industry. The cases that the Legal Action Program becomes involved in usually involve issues regarding real estate law and practice, land-use or environmental issues, private property rights or development rights.

The WRA, acting through the Legal Action Program, typically participates in a case by filing an amicus curiae (‚Äúfriend of the court‚ÄĚ) brief; as a member of a coalition of similarly interested parties; as a party to the lawsuit; or by providing legal, environmental, land-use or other research.

The Legal Action Program has most often participated in cases that have already been tried in the circuit court and are on appeal, but participation at the trial court or administrative hearing level has frequently been a vehicle for input on important legal issues at earlier stages of the litigation process.

While the legislative and regulatory work done by the WRA is exceptionally effective, the voice of the WRA is successfully heard on other fronts as well. This recap of 10 of the most recent cases gives a sense of the WRA Legal Action Program in action as an advocate for Wisconsin real estate professionals and property owners.

Well-reasoned results

Our journey through the Legal Action case list will begin with three cases where the outcome is known ‚ÄĒ all wins for real estate professionals and property owners. The WRA filed an amicus curiae brief in each, addressing, respectively, brokers earning commissions with enforceable contracts, the requisite intent needed to establish adverse possession, and the benefits of property owners not needing a variance from the town when the county already has shoreland zoning in place.

Commission earned with enforceable contract: listing contract does not require a closing

In Ash Park, LLC v. Alexander & Bishop, Ltd., the Wisconsin Court of Appeals held that a listing broker is entitled to commission when there is an enforceable contract, even when there is no closing. In this case, the listing broker sought its commission under a WB-3 Vacant Land Listing Contract entered into in 2007. When the buyer defaulted under the $6.3 million WB-13 Vacant Land Offer to Purchase, the seller sued, ultimately resulting in the Wisconsin Supreme Court holding that the seller was entitled to specific performance as stated in the offer. When the seller was unable to compel the buyer to purchase the property, the parties settled for $1.5 million.

The listing broker claimed commission under the listing contract terms, asserting that the parties' offer was an enforceable contract. The circuit court held that no commission was due because there was no closing. The broker appealed to the Wisconsin Court of Appeals, which held that the broker is entitled to commission because the parties' offer was an ‚Äúenforceable contract‚ÄĚ whereby a party can compel observance of the contract by seeking a remedy for a breach.¬†

Adverse possession requires subjective intent: one cannot accidentally possess property

In Wilcox v. Estate of Hines, the Wilcoxes claimed title to a strip of land separating their property from Lake Delton based on adverse possession and the conduct of the Somas, the prior owners of the Wilcox property. The Somas expressly disclaimed ownership of the strip and sought permission to use it from the Wisconsin Ducks tours, the entity the Somas mistakenly believed owned the strip. The Wilcoxes argued that the intent of the Somas was irrelevant so long as their use of the property was sufficient to put the true owner on notice of occupation. 

The Wisconsin Supreme Court held that a possessor's subjective intent may be relevant to rebut the presumption of hostility that arises when all other elements of adverse possession are satisfied. The Somas asking for permission showed they did not intend their actions to be hostile to any ownership interest. Allowing a person to claim adverse possession without intending to possess the property to the exclusion of the title holder would allow opportunistic neighbors to use adverse possession to acquire property that they know does not belong to them; greater certainty benefits legal title owners.

Authority of town to enact shoreland zoning when county shoreland zoning in place

In Hegwood v. Town of Eagle Zoning Board of Appeals, Hegwood built an outdoor fireplace and a pergola on his waterfront property and then applied for variances from the 20-foot setback requirement in the county’s shoreland zoning ordinance. The fireplace and pergola were, respectively, fourteen and eight feet from the lot line. The county granted both variances, but the town denied his variance from the town’s general zoning ordinance that also included a 20-foot setback. 

The circuit court agreed with Hegwood that only the county has the authority to regulate shorelands, and the court reversed the decision of the town. On appeal, the Wisconsin Court of Appeals cited Wis. Stat. § 59.692(2)(b) in determining that a town has the authority to regulate shorelands only if the town’s ordinance was in effect prior to the time the county enacts a shoreland zoning ordinance and is more restrictive than the county’s ordinance. The town appealed this decision to the Wisconsin Supreme Court. The WRA was authorized to file an amicus brief arguing against the court accepting the case. The town’s petition for review was denied, leaving the court of appeals’ holding as the final decision. This desired result took a bit of an unusual route: the WRA argued against the Supreme Court taking the case so the well-reasoned Court of Appeals decision could stand as the final word.

Awaiting the courts' decisions

The next four cases all have amicus briefs filed and the parties are awaiting the court‚Äôs decision. These cases involve short-term rentals, the enforcement of REALTOR¬ģ arbitration awards, whether an association is a ‚Äúquasi-governmental corporation‚ÄĚ subject to the open records laws, and a challenge to the PSC wind siting rules.

Regulating short-term rentals: clear and objective standards

In Heef Realty and Investments, LLP v. City of Cedarburg Board of Appeals, several property owners purchased single-family homes intending to rent them on a short-term basis. Before buying the homes, they met with city officials who informed them that the city‚Äôs zoning ordinance did not prohibit short-term rentals. After spending tens of thousands of dollars to refurbish the homes, they received notice from the city zoning board indicating that short-term rentals violated the city‚Äôs zoning ordinance, which limits use to ‚Äúsingle-family dwellings.‚ÄĚ The property owners challenged this interpretation in circuit court, and the city board appealed the case to the Wisconsin Court of Appeals after the circuit court concluded that the zoning ordinance did not clearly prohibit the use of the homes as short-term rentals.¬†

The WRA amicus brief argues that the City of Cedarburg’s zoning ordinance does not expressly regulate the short-term rental of single-family dwellings, and the zoning board’s interpretation is contrary to law, without rational basis, and lacks any clear and objective standards.

Enforcement of REALTOR¬ģ arbitration award: who decides timeliness and arbitrability?

First Weber Group v. Synergy Real Estate Group began as a procuring cause dispute in local REALTOR¬ģ association arbitration. First Weber won the arbitration. When Synergy refused to pay the arbitration award, First Weber sought judicial enforcement in circuit court. Synergy paid the award, but not the costs and legal fees incurred by First Weber. First Weber then filed arbitration with regard to payment of the fees. An arbitration hearing was scheduled, but Synergy refused to participate. First Weber filed a Petition to Compel Arbitration asking the court to determine whether there is a written agreement to arbitrate and whether a party has failed, neglected or refused to perform thereunder. The circuit court found that there was an agreement to arbitrate, but that the arbitration was barred under the 180 day rule and thus the matter was not arbitrable. First Weber appealed to the Wisconsin Court of Appeals, contending that the arbitrators should decide any timeliness issue. The court held that the courts ‚ÄĒ instead of the arbitrator and/or the hearing panel ‚ÄĒ decide procedural questions. First Weber petitioned the Wisconsin Supreme Court to hear the case, and the WRA filed an amicus brief in support, arguing that the arbitration process should be allowed to proceed before the courts step in.¬†

Public records law: is the Counties Association a quasi-governmental corporation?

In Wis. Professional Police Assoc., Inc. v. Wis. Counties Assoc., the issue is whether the Wisconsin Counties Association (WCA) is a ‚Äúquasi-governmental corporation‚ÄĚ subject to the public records law if it, among other things, receives funding from membership dues comprised of taxpayer dollars. The circuit court held that the WCA is not a ‚Äúquasi-governmental corporation‚ÄĚ subject to the public records law, and an appeal was filed. The WRA joined a group of other associations to file an amicus brief. This suit indirectly impacts the WRA, which frequently works closely with the WCA and other organizations on various policy, legislative and advocacy issues, often discussing strategies and other confidential information not intended to be made public.¬†

Challenge to the wind siting rules: housing impact statement is necessary

Despite the WRA’s best efforts during the rule-making process to make sure wind turbines are placed far enough away from homes and other structures to protect property owners from significant health and safety risks, excessive noise and visual pollution, as well as to protect property values, the wind siting rules in Wis. Admin. Code ch. PSC 128 fail to include such safeguards. Despite numerous legislative and administrative efforts, these rules went into effect, leaving only recourse through the courts. 

In Wisconsin Realtors Association v. Public Service Commission of Wisconsin, the WRA and others filed a lawsuit challenging the wind siting rules on the basis that the PSC failed to perform the housing impact statement required by state law. The circuit court and the court of appeals held that the PSC was not required to prepare a housing impact statement because the rule does not ‚Äúdirectly or substantially affect‚ÄĚ housing. While the WRA argued the Department of Administration should determine whether the rule impacts housing, the courts maintained that the PSC decides. A petition for review has been filed by the WRA asking the Wisconsin Supreme Court to take the case.

Relief in different packages

Sometimes a well-researched white paper by an independent attorney is most persuasive and can go a long way to resolve disputes before they reach the court system.

Menomonee Falls vested rights case 

A company offered to purchase a cement and gravel plant in the Village of Menomonee Falls. The offer was contingent upon obtaining an occupancy permit and satisfactory environmental test results. The company received a satisfactory fire inspection and an occupancy permit from the village and closed. After closing, news came that the village plan commission was reconsidering the occupancy permit as a result of public pressure. The company filed a notice of claim against the village in circuit court, asserting that the village‚Äôs reconsideration of the occupancy permit is illegal and violates the company‚Äôs vested rights. To determine whether the new Wis. Stat. ¬ß 66.10015 would protect property owners from the rescission of a municipal permit, the WRA‚Äôs Legal Action Committee authorized a legal opinion from outside legal counsel regarding (a) whether the new law would prohibit the village from rescinding the occupancy permit, and (b) whether the rescission of the occupancy permit would constitute a ‚Äútaking.‚ÄĚ The legal opinion will be used to educate the village and other communities about the new vested rights law and the constitutional provisions that protect property owners‚Äô rights.

Exceeding uniform dwelling code requirements through local ordinances and developer agreements 

Some Fox Valley communities are using local ordinances and developer’s agreements to place building requirements on new and existing single-family residential structures that exceed the Wisconsin’s Uniform Dwelling Code (UDC) standards for one- and two-unit dwellings. These local ordinances and agreements require either more expensive building materials or features that increase housing costs and the tax base, or new community improvements to address pre-existing service needs, such as another satellite fire station. To determine whether local communities have the authority to exceed the UDC requirements, an outside attorney specializing in construction law has provided a white paper to help local boards and GADs educate local communities about the law and encourage them to repeal any ordinances or policies that violate or end-around the UDC.

Proposed City of Madison ordinance relating to the disposition of tenants’ abandoned property

The City of Madison Common Council introduced a proposal to ‚Äúelect not to be governed by the current Wis. Stat. ¬ß 704.05(5).‚ÄĚ The city cites its constitutional home rule authority under Article XI, section 3(1) of the Wisconsin Constitution as legal grounds for opting out of the new Wis. Stat. ¬ß 704.05(5) and instead imposing its own rules. The WRA, along with other groups representing landlords, are concerned that such an ordinance could establish bad precedent by allowing municipalities to choose which state laws they want to follow and which state laws they do not. The WRA has been authorized by the Legal Action Committee to take legal action to challenge any such ordinance enacted by the city.

For more information about the WRA Legal Action Program, see www.wra.org/Legal/LegalActionProgram.

Debbi Conrad is Senior Attorney and Director of Legal Affairs for the WRA.

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