Chapter 706

706.10 Annotation Sub. (5) confirms that the rules of contract construction are to be used in interpreting the covenants of a deed. The measure of damages for breach of a covenant is the common law measure of damages for breach of warranty of title. Schorsch v. Blader, 209 Wis. 2d 401, 563 N.W.2d 538 (Ct. App. 1997), 96-1220.

706.10 Annotation A warranty deed grants a present fee simple interest. A purported reservation of a power of appointment in a warranty deed is ineffective. Powers may be reserved and lesser interests granted, but not by warranty deed. Lucareli v. Lucareli, 2000 WI App 133, 237 Wis. 2d 487, 614 N.W.2d 60, 99-1679.

706.10 Annotation Sub. (3) applies to easements. Borek Cranberry Marsh, Inc. v. Jackson County, 2010 WI 95, 328 Wis. 2d 613, 785 N.W.2d 615, 08-1144.

706.10 Annotation A necessary implication under sub. (3) is one that is so clear as to be express; it is a required implication. The words “heirs and assigns,” or any similar language, are unnecessary under sub. (3) to indicate a transferable interest. As a matter of law, “grantee” has the exact same meaning as “grantee and his heirs and assigns” unless another meaning is expressly stated or implied. Therefore, “heirs and assigns” need not be construed as having any legal effect and the use of the term in a grant of water flowage rights and not in a grant of sand removal rights in the same deed did not create a necessary implication that the sand rights were non-transferable. Borek Cranberry Marsh, Inc. v. Jackson County, 2010 WI 95, 328 Wis. 2d 613, 785 N.W.2d 615, 08-1144.

706.10 Annotation Performance in a “workmanlike manner” under sub. (7) requires a builder to perform work with the care and skill and provide suitable materials as contractors of reasonable prudence, skill, and judgment in similar construction would. Riverfront Lofts Condominium Owners Ass’n v. Milwaukee/Riverfront Properties Limited Partnership, 236 F. Supp. 2d 918 (2002).

706.10 Annotation For the premises not to be “reasonably adequate for their intended use and occupancy” under sub. (7), a showing of negligence is not necessary. The defect must be fundamental to the habitability of the building. A defendant must meet a high standard to establish a disclaimer of the protections of sub. (7). Riverfront Lofts Condominium Owners Ass’n v. Milwaukee/Riverfront Properties Limited Partnership, 236 F. Supp. 2d 918 (2002).

706.10 Annotation Builder-Vendor Liability for Construction Defects in Houses. Kirschnik. 55 MLR 369 (1972).

706.10 Annotation Duty to Disclose Limited to Commercial Vendors. Wamhoff. 64 MLR 547 (1981).

706.105 706.105 Applicability of general transfers at death provisions. Chapter 854 applies to transfers at death under a conveyance.

706.105 History History: 1997 a. 188.

706.11 706.11 Priority of certain mortgages, trust funds.

706.11(1) (1) Except as provided in sub. (4), when any of the following mortgages has been duly recorded, it shall have priority over all liens upon the mortgaged premises and the buildings and improvements thereon, except tax and special assessment liens filed after the recording of such mortgage and except liens under ss. 292.31 (8) (i) and 292.81:

706.11(1)(a) (a) Any mortgage executed to a federal savings and loan association or state or federal savings bank.

706.11(1)(b) (b) Any mortgage executed to the department of veterans affairs under s. 45.352, 1971 stats.

706.11(1)(c) (c) Any mortgage assigned to or executed to any of the following:

706.11(1)(c)1. 1. The United States, this state or a county, city, village or town in this state, or an agency, department or other formally constituted subunit of any of the foregoing.

706.11(1)(c)2. 2. The Wisconsin Health and Educational Facilities Authority created under ch. 231, the Wisconsin Housing and Economic Development Authority created under ch. 234, or any other authority created by state law.

706.11(1)(d) (d) Any mortgage executed to a state or national bank or to a state or federally chartered credit union.

706.11(1)(e) (e) Any mortgage executed under s. 66.1103 to a trustee, as defined in s. 66.1103 (2) (n).

706.11(1)(f) (f) Any mortgage executed to a mortgage banker, as defined in s. 224.71 (3).

706.11(1)(g) (g) Any mortgage executed to an insurer licensed to do business in this state.

706.11(1)(h) (h) Any mortgage executed to a licensee under s. 138.09.

706.11(1)(i) (i) Any mortgage executed to an institution chartered by the federal farm credit administration under 12 USC 2002 (a) that is part of the federal farm credit system created under 12 USC 2001 to 2279cc.

706.11(1m) (1m) 

706.11(1m)(a) (a) In this subsection:

706.11(1m)(a)1. 1. “Commitment” means an agreement under which a mortgagee agrees to advance to the mortgagor or another person funds that will be secured by the mortgage.

706.11(1m)(a)2. 2. “Construction mortgage” means a mortgage that secures an obligation incurred for the construction of an improvement on land, including the acquisition cost of the land.

706.11(1m)(b) (b) An advance of funds, including accrued but unpaid interest on the advance, that is secured by a duly recorded mortgage specified in sub. (1) (a) to (d) or (f) to (i) and that is made after the mortgage has been recorded has the same priority as the mortgage if the advance is made before the mortgagee has actual knowledge of an intervening lien or, regardless of when the advance is made, if any of the following applies:

706.11(1m)(b)1. 1. The advance is made under a commitment that is entered into before the mortgagee has actual knowledge of an intervening lien, regardless of whether the advance was made after a default or other event outside of the mortgagee’s control relieved the mortgagee of the obligation to advance funds under the commitment.

706.11(1m)(b)2. 2. The advance is made for the reasonable protection of the mortgagee’s interest, including for the payment of real property taxes, property insurance or assessments or other maintenance charges imposed under a condominium declaration or a restrictive covenant.

706.11(1m)(b)3. 3. The mortgage is a construction mortgage that clearly states on the first page of the mortgage that it is a construction mortgage and the advance is made to enable completion of the contemplated improvement on the mortgaged premises.

706.11(2) (2) State savings and loan associations shall have the priorities specified under s. 215.21 (4).

706.11(3) (3) The proceeds of any such mortgage referred to in this section shall, when paid out by a state savings bank, federal savings bank, state savings and loan association or federal savings and loan association, or of any other mortgage from any other source and received by the owner of the premises or by any contractor or subcontractor performing the work and labor, forthwith constitute a trust fund only in the hands of such owner, contractor or subcontractor for the payment proportionally of all claims due and to become due or owing from such contractor or subcontractor for lienable labor and materials until all such claims have been paid, and shall not be a trust fund in the hands of any other person. This section shall not create a civil cause of action against any person other than such owner, contractor or subcontractor. The use of any of such moneys by any owner, contractor or subcontractor for any other purpose until all claims, except those which are the subject of a bona fide dispute, have been paid in full, or proportionally in cases of a deficiency, shall constitute theft by such owner, contractor or subcontractor of any moneys so misappropriated. The district attorney of the county where the premises are situated shall on the complaint of any aggrieved party prosecute such owner, contractor or subcontractor misappropriating such moneys for such theft.

706.11(4) (4) Subsection (1) does not apply to a 2nd mortgage assigned to or executed to the department of veterans affairs under s. 45.80 (4) (a) 1., 1989 stats., or s. 45.37 (3), 2017 stats.

706.11 History History: 1971 c. 164; 1973 c. 208; 1975 c. 358, 409; 1979 c. 110 s. 60 (12); 1989 a. 231; 1991 a. 39, 221; 1993 a. 453; 1995 a. 27, 227; 1997 a. 27, 44; 1999 a. 150 s. 672; 2001 a. 104; 2007 a. 96; 2019 a. 9, 102.

706.11 Annotation The word “contractor” in sub. (3) includes an owner who acts as his own general contractor, and he can be held liable for conversion. Paulsen Lumber, Inc. v. Meyer, 47 Wis. 2d 621, 177 N.W.2d 884 (1970).

706.11 Annotation “Filed after the recording of such mortgage” in sub. (1) modifies “all liens.” Marine Bank Appleton v. Hietpas, Inc., 149 Wis. 2d 587, 439 N.W.2d 604 (Ct. App. 1989).

706.11 Annotation “Lien” in this section does not include a lease. Grosskopf Oil, Inc. v. Winter, 156 Wis. 2d 575, 457 N.W.2d 514 (Ct. App. 1990).

706.11 Annotation Sub. (1) (d) applies to all state banks, not just Wisconsin chartered state banks. To hold otherwise would discourage banks chartered in states other than Wisconsin from lending money to investors hoping to invest in Wisconsin projects and likely trigger the cost of capital for Wisconsin projects to rise. Lowell Management Services, Inc. v. Geneva National PQC, LLC, 2009 WI App 149, 321 Wis. 2d 589, 774 N.W.2d 811, 08-2533.

706.12 706.12 Uniform vendor and purchaser risk act.

706.12(1) (1) Any contract made in this state for the purchase and sale of realty shall be interpreted as including an agreement that the parties shall have the following rights and duties, unless the contract expressly provides otherwise:

706.12(1)(a) (a) If, when neither the legal title nor the possession of the subject matter of the contract has been transferred, all or a material part thereof is destroyed without fault of the purchaser or is taken by eminent domain, the vendor cannot enforce the contract, and the purchaser is entitled to recover any portion of the price that the purchaser has paid.

706.12(1)(b) (b) If, when either the legal title or the possession of the subject matter of the contract has been transferred, all or any part thereof is destroyed without fault of the vendor or is taken by eminent domain, the purchaser is not thereby relieved from a duty to pay the price, nor is the purchaser entitled to recover any portion thereof that the purchaser has paid.

706.12(2) (2) This section shall be so construed as to make uniform the law of those states which enact it.

706.12(3) (3) This section may be cited as the uniform vendor and purchaser risk act.

706.12 History History: 1975 c. 422; 1993 a. 486.

706.13 706.13 Slander of title.

706.13(1) (1) In addition to any criminal penalty or civil remedy provided by law, any person who submits for filing, entering in the judgment and lien docket or recording, any lien, claim of lien, lis pendens, writ of attachment, financing statement or any other instrument relating to a security interest in or the title to real or personal property, and who knows or should have known that the contents or any part of the contents of the instrument are false, a sham or frivolous, is liable in tort to any person interested in the property whose title is thereby impaired, for punitive damages of $1,000 plus any actual damages caused by the filing, entering or recording.

706.13(2) (2) This section applies to any person who causes another person to act in the manner specified in sub. (1).

706.13(3) (3) This section does not apply to a register of deeds or other government employee who acts in the course of his or her official duties and files, enters or records any instrument relating to title on behalf of another person.

706.13 History History: 1979 c. 221; 1995 a. 224; 1997 a. 27.

706.13 Annotation Enactment of this section did not create a cause of action nor destroy the common-law right of recovery. Schlytter v. Lesperance, 62 Wis. 2d 661, 215 N.W.2d 552 (1974).

706.13 Annotation When a lawsuit is commenced under this section, conditional rather than absolute privilege applies to the filing of a lis pendens. Kensington Development Corp. v. Israel, 142 Wis. 2d 894, 419 N.W.2d 241 (1988).

706.13 Annotation The filing of a lis pendens is not privileged when there is no relationship between the filing and the underlying action. Larson v. Zilz, 151 Wis. 2d 637, 445 N.W.2d 699 (Ct. App. 1989).

706.13 Annotation To recover for slander of title, it is not necessary in all cases to prove the loss of an actual sale. The trial court must consider whether it is reasonable under the circumstances to require proof that the slander prevented a particular sale, and if not, the court must determine the degree of particularity required. Tym v. Ludwig, 196 Wis. 2d 375, 538 N.W.2d 600 (Ct. App. 1995), 94-2859.

706.14 706.14 Transitional and curative provisions. The operation or effect of a conveyance made or recorded in accordance with the provisions of any prior law of this state, or thereafter validated, perfected or cured under any such prior law, shall not be impaired by any provision of this chapter.

706.15 706.15 Liens against public officials or employees. No lien may be filed, entered or recorded against the real or personal property of any official or employee of the state or any political subdivision of the state, relating to an alleged breach of duty by the official or employee, except after notice and a hearing before a court of record and a finding by the court that probable cause exists that there was a breach of duty.

706.15 History History: 1979 c. 221; 1995 a. 224.

706.20 706.20 Disclosure duty; immunity for providing notice about the sex offender registry.

706.20(1) (1) Except as provided in sub. (2), an owner of an interest in real property has no duty to disclose to any person in connection with the sale, exchange, purchase or rental of the real property any information related to the fact that a particular person is required to register as a sex offender under s. 301.45 or any information about the sex offender registry under s. 301.45.

706.20(2) (2) If, in connection with the sale, exchange, purchase or rental of real property, a person requests of an owner of an interest in the real property information related to whether a particular person is required to register as a sex offender under s. 301.45 or any other information about the sex offender registry under s. 301.45, the owner has a duty to disclose such information, if the owner has actual knowledge of the information.

706.20(3) (3) Notwithstanding sub. (2), the owner is immune from liability for any act or omission related to the disclosure of information under sub. (2) if the owner in a timely manner provides to the person requesting the information written notice that the person may obtain information about the sex offender registry and persons registered with the registry by contacting the department of corrections. The notice shall include the appropriate telephone number and Internet site of the department of corrections.

706.20 History History: 1999 a. 89.

706.22 706.22 Prohibition on imposing time-of-sale, purchase, or occupancy requirements.

706.22(1) (1) Definitions. In this section:

706.22(1)(a) (a) “Actions with respect to the property” include such actions as having an inspection made by an employee or agent of, or contractor with, the local governmental unit; making improvements or repairs; removing junk or debris; mowing or pruning; performing maintenance or upkeep activities; weatherproofing; upgrading electrical systems; paving; painting; repairing or replacing appliances; replacing or installing fixtures or other items; and actions relating to compliance with building codes or other property condition standards.

706.22(1)(b) (b) “Local governmental unit” means any of the following:

706.22(1)(b)1. 1. A political subdivision of this state.

706.22(1)(b)2. 2. A special purpose district in this state.

706.22(1)(b)3. 3. An agency or corporation of a political subdivision or special purpose district in this state.

706.22(1)(b)4. 4. A combination or subunit of any entity under subds. 1. to 3.

706.22(1)(b)5. 5. An employee or committee of any entity under subds. 1. to 4.

706.22(2) (2) Requirements tied to sale, purchase, or taking occupancy of property prohibited.

706.22(2)(a) (a) Except as provided in par. (b), no local governmental unit may by ordinance, resolution, or any other means do any of the following:

706.22(2)(a)1m. 1m. Restrict the ability of an owner of real property to sell or otherwise transfer title to or refinance the property by requiring the owner or an agent of the owner to take certain actions with respect to the property or pay a related fee, to show compliance with taking certain actions with respect to the property, or to pay a fee for failing to take certain actions with respect to the property, at any of the following times:

706.22(2)(a)1m.a. a. Before the owner may sell, refinance, or transfer title to the property.

706.22(2)(a)1m.b. b. At the time of the sale or refinancing of, or the transfer of title to, the property.

706.22(2)(a)1m.c. c. Within a certain period of time after selling, refinancing, or transferring title to the property.

706.22(2)(a)2m. 2m. Restrict the ability of a person to purchase or take title to real property by requiring the person or an agent of the person to take certain actions with respect to the property or pay a related fee, to show compliance with taking certain actions with respect to the property, or to pay a fee for failing to take certain actions with respect to the property, at any of the following times:

706.22(2)(a)2m.a. a. Before the person may complete the purchase of or take title to the property.

706.22(2)(a)2m.b. b. At the time of completing the purchase of or taking title to the property.

706.22(2)(a)2m.c. c. Within a certain period of time after completing the purchase of or taking title to the property.

706.22(2)(a)3m. 3m. Restrict the ability of a purchaser of or transferee of title to residential real property to take occupancy of the property by requiring the purchaser or transferee or an agent of the purchaser or transferee to take certain actions with respect to the property or pay a related fee, to show compliance with taking certain actions with respect to the property, or to pay a fee for failing to take certain actions with respect to the property, at any of the following times:

706.22(2)(a)3m.a. a. Before the purchaser or transferee may take occupancy of the property.

706.22(2)(a)3m.b. b. At the time of taking occupancy of the property.

706.22(2)(a)3m.c. c. Within a certain period of time after taking occupancy of the property.

706.22(2)(b) (b) Paragraph (a) does not do any of the following:

706.22(2)(b)1. 1. Prohibit a local governmental unit from requiring a real property owner or the owner’s agent to take certain actions with respect to the property not in connection with the purchase, sale, or refinancing of, or the transfer of title to, the property.

706.22(2)(b)2. 2. Prohibit a local governmental unit from enforcing, or otherwise affect the responsibility, authority, or ability of a local governmental unit to enforce, a federal or state requirement that does any of the things a local governmental unit is prohibited from doing under par. (a).