Watts v Watts - Brief PDF

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Restitution

Watts [“wife”] v. Watts [“husband”] COURT AND DATE: Supreme Court of Wisconsin 137 Wis. 2d 506, 405 N.W. 2d 303 (1987) PROCEDURAL HISTORY: Circuit court: dismissed Sue Ann’s amended complaint for failure to state a claim *supreme court: hold that Sue Ann does state a claim. Reverse the judgement of the circuit court and remand the case to the circuit court for further proceedings. ISSUE: Are cohabiting partners each entitled to a share of the wealth acquired over the term of their relationship if they carry on as a married couple, but never get married? TRIGGER FACTS: Sue Ann Evans (Sue) (plaintiff) and James Watts (James) (defendant) lived together for twelve years in a “marriage-like” relationship and had two children. Sue claims she quit her job and gave up her plans to become a nurse on James’s promise to provide for her. Sue took James’s last name, and the couple shared expenses, bank accounts, and tax returns, and held themselves out as husband and wife. Sue contributed to the partnership through housekeeping, childrearing, working at James’s office, and starting a family business, for which she was not compensated. Eventually, the couple broke up, and Sue moved out of their home. Sue brought claims for breach of contract, unjust enrichment, and partition, claiming that she is entitled to her fair share of the wealth accumulated during the couple’s relationship. The Dane County Circuit Court dismissed Sue’s complaint for failure to state a claim. Sue appealed to the Court of Appeals of Wisconsin. The Supreme Court of Wisconsin took jurisdiction over the case after a certification from the court of appeals.

PLAINTIFF’S MAIN ARGUMENTS: 1. She is entitled to an equitable division of property under sec.767.255  Argues that they constitute a family, relying on Warden v Warden. Court concludes that the legislature did not intent 767.255 to extend to unmarried cohabitants. 2. Defendant is estopped to assert as a defense to the plaintiff’s first claim that the parties aren’t married  Doctrine of “marriage by estoppel” should not be applied in this case for the same reasons as to why first claim was rejected 3. She is entitled to damages for the defendants breach of an express contract or an implied in fact contract between the parties 4. The defendant holds the accumulated property under a constructive trust based upon unjust enrichment 5. She is entitled to a partition of the parties’ real and personal property.

Restitution

DEFENDANT’S MAIN ARGUMENTS: Responds to plaintiff’s contract theory with 1. The courts recognition of Sue Ann’s contract claim for a share of their property contravened the Wisconsin family code  Court says false. 2. The legislature not the courts should determine the property and contract rights of unmarried cohabiting parties  Court is not persuaded. 3. Their relationship was immoral and illegal and that any recognition of it contravenes public policy.  This doesn’t have any bearing on whether there was a bargain between them. RULE (the law): Unmarried cohabitants may each be entitled to a share of the wealth jointly accumulated during the cohabitation. HOLDING + REASONING: Yes. An unmarried cohabitant may be entitled to a fair share of accumulated wealth during the cohabitation. There is no evidence that the legislature intended for the provisions of the Family Code dedicated to property division after marriage to apply to unmarried cohabiting couples. For that reason, the doctrine of marriage by estoppel will not be applied to unmarried cohabitants. Nevertheless, unmarried cohabitants are free to enter express or implied contracts with one another, and the contract will not be unenforceable on the basis of public policy so long as there was some consideration other than sexual activity. See In Matter of Estate of Steffes, 290 N.W.2d 697 (1980). This court rejects the approach taken by the Illinois Supreme Court in Hewitt v. Hewitt, 394 N.E.2d 1204 (1979), refusing to give judicial recognition to illegal and immoral nonmarital relationships by extending property and contract rights to unmarried cohabiting couples. Wisconsin permits no-fault divorce and has decriminalized nonmarital cohabitation, and thus its laws are distinguishable from Illinois’s. Additionally, a claim for unjust enrichment may be proper when (1) a benefit is conferred on a party, with (2) knowledge or appreciation of the benefit, and (3) the party unjustly accepts or retains the benefit. Unmarried cohabitants may properly bring a claim for unjust enrichment based on benefits conferred during the relationship. Refusing to allow such marriage-like claims would essentially allow one equally guilty party to keep all assets and property acquired during the relationship, which is plainly inequitable. Lastly, partition is a claim for division of any property that is jointly held. When parties act jointly financially and socially while living together, it is strong evidence that they intended to share property equally. Here, Sue and James acted as a married couple. They lived together, had children, shared financial accounts and responsibilities, and were listed as husband and wife on legal documents. Sue provided services and contributed to the couple’s wealth. Sue has pleaded sufficient facts to state a cause of action for breach of contract, unjust enrichment, and partition. The circuit court’s dismissal of the complaint is reversed. The case is remanded for a determination of the merits of Sue’s claims....