Brief - Watts v. Watts PDF

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Restitution

Madden

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Watts v. Watts, 137 Wis. 2d 506, 405 N.W. 2d 303 (1987) Supreme Court of Wisconsin Plaintiff: Sue Watts Defendant: James Watts Cause of Action: equitable division of property, marriage by estoppel, breach of express or implied k, unjust enrichment, partition Relief Sought: An order of accounting of ∆s personal and business assets accumulated during their cohabitation and an equitable division of property. Basis for Dispute: Law Facts: (according to Sue’s complaint and accepted as true for purposes of assessing the validity of the complaint) - They met when Sue was 19 years old, living at home with her parents and working full time as a nurse’s aid in preparation for a nursing career - ∆ persuaded her to move into an apartment paid for by him and quit her job - ∆ indicated that he would provide for her - They began living together in 1969 in a “marriage-like” relationship, holding themselves out to the public as husband and wife - She assumed ∆’s surname. Had 2 kids. They have his surname. - Filed joint income tax returns/ joint bank accounts asserting themselves as husband and wife. - ∆ insured ∏ as his wife on his medical insurance policy - They purchased real and personal property together as husband and wife. - ∏ contributed childcare and homemaking services; cleaning, cooking, laundering, shopping, running errands, and maintain the grounds surrounding their home. - ∏ contributed personal property to the relationship which she owned at the beginning of the relationship or acquired through gifts or purchases during the relationship. - ∏ worked for him 20-25 hours a week as a receptionist - Then she worked 40-60 hours/week when she started a business w/ her sister-in-law. - ∆ made living with him intolerable and she left. She was forced to move from her home and their relationship was irretrievably broken. ∆ barred ∏ from returning to her business. Sue’s Argument: - because of her domestic and business contributions, the business and personal wealth of the couple increased - She never received any compensation for the contributions to the relationship and that the ∆ indicated to the ∏ both orally and through his conduct that he considered her to be his wife and that would share equally in the increased wealth. - Since they broke up, ∆ has refused to share equally with her the wealth accumulated through their joint efforts or to compensate her in any way for her contributions to the relationship. James’s Argument: Procedural History: Appeal from a judgment of the circuit court dismissing Sue’s amended complaint because it failed to state a claim upon which relief may be granted.

Restitution Madden 2 Issue1: property accumulated during the cohabitation is that the ∏, ∆ and their children constitute a “family” entitled ∏ to bring an action for property division under sec. 767.02 and have the court divide the property equally. Sue’s argument: the legislature intended the section to mean family and not marriage because they deliberately changed the name of the statute and failed to provide a definition for family. The court should look to the length and purpose of the parties’ relationship, their two children, and the contributions and future prospects of each in determining their respective shares of the property. Application: The sole purpose of the legislation was to promote an equitable and reasonable adjudication of the economic and custodial issues involved in marriage relationships. Not only intended to promote the family but also intended family to be within the marriage context. Mini-Conclusion: We decline the invitation to extent the application of the section to unmarried cohabitants The plaintiff has not stated a claim for property under the statute. Issue2: Marriage by estoppel Sue’s argument: the ∆ should be estopped from asserting the lack of a legal marriage as a defense against the ∏’s claim for property division. Application: legislature did not intend to govern property division between unmarried cohabitants. We don’t think the parties’ conduct should place them within the ambit of a statute which the legislature did not intend to govern them. Mini-Conclusion: Marriage by estoppel should not be applied in this case. Issue 3: she and ∆ had a k to share equally the property accumulated in their relationship. Sue’s argument: she and the ∆ had a k, either express or implied in fact k, which ∆ breached. James’s argument: - The court’s recognition of ∏’s k claim contravenes the Wisconsin Family Code. - The legislature, not the courts, should determine the property and k rights of unmarried cohabiting parties. - The parties’ relationship was immoral and illegal and that any recognition of a k between the parties or ∏’s claim for a share of the property accumulated during the cohabitation contravenes public policy. Rule: A k will not be enforced if it violates public policy. A declaration that the k is against public policy should be made only after a careful balancing, in the light of all the circumstances, of the interest in enforcing a particular promise against the policy against enforcement. Courts should be reluctant to frustrate a party’s reasonable expectations without a corresponding benefit to be gained in deterring “misconduct” or avoiding inappropriate use of the judicial system (Rest. 2nd of K §178 comments b a e). Application: The ∆ failed to persuade this court that enforcing an express or implied in fact k between these parties would in fact violate the Wisconsin Family Code.

Restitution Madden Rule: Courts generally refuse to enforce k’s for which the sole consideration is sexual relations, sometimes referred to as “meretricious” relationships. However, courts distinguish between k’s that are explicitly and inseparably founded on sexual services and those that are not.

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A bargain between two people is not illegally merely because there is an illicit relationship between the two so long as the bargain is independent of the illicit relationship and the illicit relationship does not constitute any part of the consideration bargained for and is not a condition on the bargain. The refusal to enforce what are in other contexts clearly lawful promises will not undo the parties’ relationship and may not discourage others from entering into such relationships. A change in one party’s circumstances in performance of the agreement may imply an agreement between the parties. Mini-conclusion: the ∏ has pleaded facts necessary to state a claim for damages resulting from ∆’s breach of an express or an implied k to share with the ∏ property accumulated through the efforts of both parties during their relationship. Issue4: Unjust enrichment Rule: A claim of unjust enrichment does not arise out of an agreement entered into by the parties. Rather, an action for recovery based upon unjust enrichment is grounded on the moral principle that one who has received a benefit has a duty to make restitution where retaining such a benefit would be unjust. Wisconsin: 1) A benefit conferred on the ∆ by the ∏ 2) Appreciation of knowledge by ∆ of the benefit and 3) Acceptance or retention of the benefit by the ∆ under circumstances making it inequitable for the ∆ to retain the benefit. James’s argument: the court should leave the parties to an illicit relationship such as the one in the case essentially as they are found, providing no relief at all to either party. Application: allowing no relief at all to one party in a so-called illicit relationship effectively provides total relief to the other by leaving that party owner of all the assets acquired through the efforts of both. You can’t seriously argue the party getting all the assets is less guilty than the other party. Mini-Conclusion: The alleged facts are sufficient to state a claim for recovery based on unjust enrichment. Issue5: Partition Sue’s argument: all real and personal property accumulated by the couple during their relationship according to the ∏’s interest therein and pursuant to Wis. Statute’s. Rule: In Wisconsin partition is a remedy under both the statutes and common-law. Partition applies generally to all disputes over property held by more than one party…. Mini-Conclusion: sufficient to state a claim for relief under statutory or common law partition.

Restitution

Madden

Court’s Holding(s): We hold that the complaint states a claim upon which relief may be granted. Reversed and remanded. Alleged sufficient claims for: - Breach of k - Unjust enrichment - Partition Not okay for: - Marriage by estoppel - Statutory division of property

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