Great Lakes Excavating, Inc. v. Dollar Tree Stores, Inc. ( 2022 )

2022 WI 44SUPREME COURT OF WISCONSIN
CASE NO.: 2019AP2095
COMPLETE TITLE: Great Lakes Excavating, Inc.,
Plaintiff-Appellant-Petitioner,
v.
Dollar Tree Stores, Inc.,
Defendant-Respondent,
AMCON Design and Construction Co., LLC,
Riverworks Development Corporation and John H.
Burkemper,
Defendants,
Riverworks City Center, LLC,
Intervenor-Respondent.
REVIEW OF DECISION OF THE COURT OF APPEALS
Reported at 397 Wis. 2d 10, 959 N.W.2d 351PDC No: 2021 WI App23 - Published
OPINION FILED: June 22, 2022
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: April 7, 2022
SOURCE OF APPEAL:
COURT: Circuit
COUNTY: Milwaukee
JUDGE: William S. Pocan
JUSTICES:
REBECCA GRASSL BRADLEY, J., delivered the majority opinion of
the Court, in which ZIEGLER, C.J., ROGGENSACK, HAGEDORN, and
KAROFSKY, JJ., joined. DALLET, J., filed a dissenting opinion,
in which ANN WALSH BRADLEY, J., joined.
NOT PARTICIPATING:
ATTORNEYS:
For the plaintiff-appellant-petitioner, there were briefs
filed by John E. Machulak and Machulak, Robertson & Sodos, S.C.,
Milwaukee. There was an oral argument by John E. Machulak.
For the intervenor-respondent, there was a brief filed by
Steven J. Slawinski, Jessica K. Haskell and O’Neil, Cannon,
Hollman, DeJong & Laing S.C., Milwaukee. There was an oral
argument by Steven J. Slawinski.
2
2022 WI 44NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2019AP2095
(L.C. No. 2019CV2945)
STATE OF WISCONSIN : IN SUPREME COURT
Great Lakes Excavating, Inc.,
Plaintiff-Appellant-Petitioner,
v.
Dollar Tree Stores, Inc., FILED
Defendant-Respondent,
JUN 22, 2022
AMCON Design and Construction Co., LLC,
Riverworks Development Corporation and John H. Sheila T. Reiff
Clerk of Supreme Court
Burkemper,
Defendants,
Riverworks City Center, LLC,
Intervenor-Respondent.
REBECCA GRASSL BRADLEY, J., delivered the majority opinion of
the Court, in which ZIEGLER, C.J., ROGGENSACK, HAGEDORN, and
KAROFSKY, JJ., joined. DALLET, J., filed a dissenting opinion,
in which ANN WALSH BRADLEY, J., joined.
REVIEW of a decision of the Court of Appeals. Reversed and
cause remanded.
No. 2019AP2095
¶1 REBECCA GRASSL BRADLEY, J. Great Lakes Excavating,
Inc. (Great Lakes) seeks review of a court of appeals decision1
affirming an order of the circuit court,2 which granted partial
summary judgment to Riverworks City Center, LLC (Riverworks)
after finding Great Lakes fully waived its construction lien.
Before signing a form lien waiver document titled "Waiver of
Lien to Date," the owner of Great Lakes crossed off the words
"to Date," replaced them with the handwritten word "Partial,"
and initialed next to the change. Great Lakes argues this
change "specifically and expressly" limited the lien waiver to
the amount received——$33,448——in accordance with the
requirements of Wis. Stat. § 779.05(1), and asserts extrinsic
evidence reveals all parties intended the waiver to be partial.
Alternatively, Great Lakes contends equitable estoppel precludes
Riverworks from asserting Great Lakes waived its lien in full.
Riverworks maintains the form constituted a full waiver of Great
Lakes' lien rights because it failed to satisfy the statutory
procedure to limit the waiver.
¶2 We hold the waiver document satisfied Wis. Stat.
§ 779.05(1) (2019–20)3 by "specifically and expressly" limiting
the waiver to "a particular portion of . . . labor, services,
1Great Lakes Excavating, Inc. v. Dollar Tree Stores, Inc.,
2021 WI App 23, 397 Wis. 2d 210, 959 N.W.2d 351.
2The Honorable William S. Pocan, Milwaukee County Circuit
Court, presided.
3All subsequent references to the Wisconsin Statutes are to
the 2019-20 version unless otherwise indicated.
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No. 2019AP2095
materials, plans, or specifications" in the amount of $33,448.
Accordingly, we reverse the decision of the court of appeals.
I. BACKGROUND
¶3 In this construction lien waiver dispute, Riverworks
contracted with AMCON Design and Construction Co. (AMCON) to
construct a commercial building and parking lot in Milwaukee,
Wisconsin, called the Riverworks City Center project (the
Project).4 Dollar Tree Stores, Inc. (Dollar Tree) was slated as
the anchor tenant. AMCON subcontracted with Great Lakes to
perform excavating work for installation of the parking lot.
The original contract amount for this work was $37,165, but once
the installation started, Great Lakes encountered poor soil
quality necessitating additional excavating work. As a result,
and following a series of change orders, the amount AMCON owed
Great Lakes ultimately totaled $222,238.
¶4 After completing its work on the Project, Great Lakes
invoiced AMCON for $222,238 and, when no payment was received,
served Riverworks and Dollar Tree with a notice of intent to
file a claim for a construction lien. At that point, and upon
AMCON's invitation, the owner of Great Lakes, Duwayne Bruckner
(Bruckner), went to AMCON's office to collect payment. A
representative from AMCON told Bruckner only $33,448 was
available for payment, and presented to Bruckner a preprinted
lien waiver form, titled "Waiver of Lien to Date" for his
This case comes to us on review of a partial grant of
4
summary judgment. The facts as stated are undisputed by the
parties.
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No. 2019AP2095
signature. The printed body of the document provided, in
relevant part:
The undersigned, for and in consideration of
$33,448.00 Dollars and other good and valuable
consideration, the receipt whereof is hereby
acknowledged, does hereby waive and release any and
all lien or claim of, or right to, lien, under the
statutes of the State of WI, relating to liens of
mechanics, laborers and materialmen, with respect to
and upon the foregoing described property, and the
improvements thereon, and with respect to any
statutory lien bond, and on the material, fixtures,
apparatus or machinery furnished, and on the moneys,
funds or other considerations due or to become due
from the Company, on account of labor, services,
material, fixtures, apparatus or machinery furnished
to this date by the undersigned for the foregoing
described property.
Prior to signing the waiver and accepting the $33,448 check,
Bruckner crossed off "to Date" in the document title, replaced
it with the handwritten word, "Partial," and initialed next to
the modification. Bruckner made no other changes to the form.
¶5 Following unsuccessful efforts to receive payment for
the outstanding amount due, Great Lakes filed a "Subcontractor
Claim for Lien" pursuant to Wis. Stat. § 779.06 and sued for the
balance of $188,790. Riverworks moved for partial summary
judgment as to the claim for foreclosure of the lien, which
Dollar Tree joined, on the grounds that Great Lakes did not
comply with Wis. Stat. § 779.05(1)'s procedure for limiting the
waiver to a particular portion of the work, resulting in a full
waiver of its lien rights. The circuit court agreed, granting
Riverworks' motion because "[m]erely changing the title of the
lien waiver, without additional explanation, does not
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No. 2019AP2095
specifically and expressly limit the waiver to apply to a
particular portion of such labor, services, materials, plans, or
specifications."5
¶6 The court of appeals affirmed, concluding neither
"crossing off 'to Date' and writing in 'Partial' in the title of
the document" nor referencing "$33,448 Dollars" in the document
"specifically and expressly limit the waiver to a particular
portion of the work," "such as the labor in the original
contract, which totaled $37,165." Great Lakes Excavating, Inc.
v. Dollar Tree Stores, Inc., 2021 WI App 23, ¶¶21–22, 397
Wis. 2d 210, 959 N.W.2d 351. The court emphasized the waiver's
"broad[]" statement that Great Lakes waived "any and all
lien . . . on account of labor, services, material, fixtures,
apparatus or machinery furnished to this date[.]" Id., ¶22.
Great Lakes moved for reconsideration, which the court of
appeals denied. We granted Great Lakes' petition for review.
II. STANDARD OF REVIEW
¶7 This court reviews a grant of summary judgment
independently, "using the same methodology of the circuit court
5Because Dollar Tree's involvement in the case was based
solely on Great Lakes' claim for foreclosure against Riverworks,
the circuit court's July 31, 2019 order dismissing the
foreclosure claim had the effect of disposing of all claims
between Great Lakes and Dollar Tree. The order did not
explicitly dismiss Dollar Tree, so Great Lakes and Dollar Tree
stipulated to Dollar Tree's dismissal from the case,
acknowledging in the stipulation that Great Lakes would appeal
the dismissal. Great Lakes appealed the orders dismissing
Dollar Tree and granting partial summary judgment to Riverworks,
and Riverworks intervened. Great Lakes maintains additional
claims against Riverworks not at issue in this appeal.
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No. 2019AP2095
and the court of appeals." Kemper Indep. Ins. Co. v. Islami,
2021 WI 53, ¶13, 397 Wis. 2d 394, 959 N.W.2d 912 (quoting Talley
v. Mustafa, 2018 WI 47, ¶12, 381 Wis. 2d 393, 911 N.W.2d 55).
"Summary judgment is appropriate when there is no genuine
dispute of material fact and the moving party is entitled to
judgment as a matter of law." Id. (quoting Talley, 381
Wis. 2d 393, ¶12).
¶8 This case also requires the interpretation of Wis.
Stat. § 779.05(1). "Issues of statutory interpretation and
application present questions of law." James v. Heinrich, 2021
WI 58, ¶15, 397 Wis. 2d 517, 960 N.W.2d 350 (citing Police Ass'n
v. City of Milwaukee, 2018 WI 86, ¶17, 383 Wis. 2d 247, 914
N.W.2d 597).
III. DISCUSSION
A. Construction Lien Statutes
¶9 "A construction lien is a remedy created by statute to
insure payment to contractors, subcontractors, tradesmen,
laborers, and materialmen who have furnished labor or materials
in good faith for improvement of another's property." Hoida,
Inc. v. M & I Midstate Bank, 2004 WI App 191, ¶20, 276
Wis. 2d 705, 688 N.W.2d 691 (quotation marks omitted). Statutes
governing construction liens were first enacted more than "150
years ago to encourage construction by protecting the
contractors and subcontractors of building projects." Kraemer
Bros., Inc. v. Pulaski St. Bank, 138 Wis. 2d 395, 399, 406
N.W.2d 379 (1987).
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No. 2019AP2095
¶10 The lien laws of this state have consistently been
described as "remedial in character," with the purpose of
"protecting the claims of tradesmen, laborers and materialmen
for work and materials supplied." Bayland Bldgs., Inc. v.
Spirit Master Funding VIII, LLC, 2017 WI App 42, ¶2, 377
Wis. 2d 149, 900 N.W.2d 94 (quoting Wes Podany Constr. Co. v.
Nowicki, 120 Wis. 2d 319, 324, 354 N.W.2d 755 (Ct. App. 1984));
see also Goebel v. Nat'l Exchangors, Inc., 88 Wis. 2d 596, 606,
277 N.W.2d 755 (1979); Tri-State Mech., Inc. v. Northland Coll.,
2004 WI App 100, ¶8, 273 Wis. 2d 471, 681 N.W.2d 302 ("[O]ne of
the general purposes of construction lien laws is to protect
subcontractors of building projects." (citing Kraemer Bros., 138
Wis. 2d at 399)). Because construction liens are "purely
statutory," "[o]ne pursuing rights under the Wisconsin
construction lien law must follow the statute or lien rights
fail." Wes Podany Constr. Co., 120 Wis. 2d at 324.
¶11 Construction liens can be waived under Wis. Stat.
§ 779.05(1). That statute provides in relevant part:
Any waiver document shall be deemed to waive all lien
rights of the signer for all labor, services,
materials, plans, or specifications performed,
furnished, or procured, or to be performed, furnished,
or procured, by the claimant at any time for the
improvement to which the waiver relates, except to the
extent that the document specifically and expressly
limits the waiver to apply to a particular portion of
such labor, services, materials, plans, or
specifications.
The statute further directs that "[a]ny ambiguity in such
document shall be construed against the person signing it."
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No. 2019AP2095
§ 779.05(1). The lien waiver statute, created in 1968 as Wis.
Stat. § 289.05(1) and renumbered in 1979, was "primarily a
codification of what was common practice in the construction
industry." Druml Co., Inc. v. City of New Berlin, 78
Wis. 2d 305, 310, 254 N.W.2d 265 (1977) (citing Walter B.
Raushenbush, Wisconsin Construction Lien Law 1974 (1975)); see
also § 3, ch. 351, Laws of 1967; Wis. Stat. § 289.05(1) (1967–
68); § 57, ch. 32, Laws of 1979.
B. The Lien Waiver Document
¶12 Resolution of this dispute revolves around whether
Great Lakes "follow[ed] the statute" in limiting its lien waiver
to the $33,448 received in consideration for the waiver, by
replacing "to Date" with "Partial" in the document title. See
Wes Podany Constr. Co., 120 Wis. 2d at 324; Wis. Stat.
§ 779.05(1). Riverworks asserts this handwritten modification
creates an ambiguity because the printed body of the waiver
document otherwise constitutes a full waiver under which Great
Lakes "waive[s] and release[s] any and all lien or claim of, or
right to, lien, . . . on account of labor, services, material,
fixtures, apparatus or machinery furnished to this date," and as
of that date, all of the work had been completed. Under
§ 779.05(1), Riverworks argues the resulting ambiguity must be
"construed against the person signing it." Great Lakes
disagrees, arguing the waiver is unambiguously a partial waiver
because there is no competing interpretation of the document.
We agree with Great Lakes that the waiver document is not
ambiguous and satisfies § 779.05(1) as a partial waiver of the
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No. 2019AP2095
lien with respect to only the $33,448 paid.6 The handwritten
term "Partial," in conjunction with the specific amount of
consideration, indicates the lien was waived only to the extent
of that portion of the total amount owed.
1. The Waiver is Unambiguously Partial
¶13 In construing the lien waiver document, we first
address the inconsistency between the printed terms and the
handwritten language. Read in isolation, the printed text of
the waiver document, waiving all lien rights to date,
constitutes a full lien waiver; it is undisputed that all of the
work on the Project had been completed at the time Bruckner
signed the waiver form. The handwritten addition of "Partial"
in the document title, replacing the printed words "to Date,"
conflicts with the preprinted language in the body of the
document indicating Great Lakes "does hereby waive and release
any and all lien . . . on account of labor, services, material,
fixtures, apparatus or machinery furnished to this date" with
respect to the Riverworks property.
Riverworks argued in its briefing, "The lien waiver
6
contains no language relating the $33,448 to a particular
portion of the work performed by Great Lakes." The court of
appeals invalidated the waiver on this same basis. See Great
Lakes Excavating, 397 Wis. 2d 210, ¶¶21–22. Riverworks later
conceded at oral argument that a reference to a monetary value
can satisfy the statutory requirement to limit the waiver to a
"particular portion" of the work. As we explain further in
Section III.B.2, we agree that limiting the lien waiver in this
case to a specific dollar amount satisfies Wis. Stat.
§ 779.05(1) irrespective of Riverworks' concession.
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No. 2019AP2095
¶14 Because a lien waiver document is a release, we apply
contract principles to resolve this conflict. See Druml Co., 78
Wis. 2d at 311 (holding that a claimant's letter constituted a
waiver under the lien waiver statute because it was "clear in
its intent to release the lien claim"); Marx v. Morris, 2019 WI
34, ¶63, 386 Wis. 2d 122, 925 N.W.2d 112 ("A release is to be
treated as a contract." (quoting Gielow v. Napiorkowski, 2003 WI
App 249, ¶14, 268 Wis. 2d 673, 673 N.W.2d 351)). Riverworks
contends a construction lien waiver is not a contract because
Wis. Stat. § 779.05(1) does not "require" "an offer, acceptance,
and consideration." While the statute does not require these
elements, nothing in the statutory text strips the release in
this case of its contractual nature. The lien waiver satisfies
each element of a contract; accordingly, contract principles
apply to its interpretation.
¶15 "[I]n accord with the general rule that all parts of a
contract are to be given effect, the courts must seek to
reconcile inconsistencies between the changed or added terms and
the printed matter. When, however, the printed contract
provisions irreconcilably conflict with the provisions added by
the parties, the added provisions will control." 11 Williston
on Contracts § 32:13 (4th ed.). The handwritten and printed
terms in the waiver document are irreconcilable: the document
is either a partial lien waiver or a full lien waiver, but it
cannot be both. "Where written provisions are inconsistent with
printed provisions (of a contract), an interpretation is
preferred which gives effect to the written provisions."
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No. 2019AP2095
Tollefson v. Green Bay Packers, 256 Wis. 318, 322, 41 N.W.2d 201(1950) (quoting Restatement, Contracts § 236(e)); see also Hicks
Pub. Co. v. Wis. Cent. Ry. Co., 138 Wis. 584, 120 N.W. 512, 514
(1909) ("It is a canon of construction that where a contract 'is
written in part and printed in part, as where it has been filled
in upon a printed form, the parties usually pay much more
attention to the written parts than to the printed parts.
Accordingly, if the written provisions cannot be reconciled with
the printed, the written provisions control.'"). In accordance
with black letter contracts law, we reconcile this inconsistency
by giving effect to the handwritten terms.7
7Remarkably, the dissent claims contract principles should
not be applied to a contract. Dissent, ¶32. Legislative
enactments concerning contracts do not displace the entire body
of legal principles governing them. "To accomplish a change in
the common law, the language of the statute must be clear,
unambiguous, and peremptory." Fuchsgruber v. Custom
Accessories, Inc., 2001 WI 81, ¶25, 244 Wis. 2d 758, 628
N.W.2d 833. "[L]egislation in derogation of the common law
should be strictly construed so as to have minimal effect on the
common law rule." Augsburger v. Homestead Mut. Ins. Co., 2014
WI 133, ¶40, 359 Wis. 2d 385, 856 N.W.2d 874 (citing
Fuchsgruber, 244 Wis. 2d 758, ¶25; NBZ, Inc. v. Pilarski, 185
Wis. 2d 827, 836, 520 N.W.2d 93 (Ct. App. 1994)). Wisconsin
Stat. § 779.05(1) directs our treatment of ambiguity in lien
waivers, but it does not abrogate the entire suite of common law
contract principles. Because the legislature removed a tool,
the dissent abandons the whole toolbox. This is not the law.
In NBZ, the court of appeals determined covenants not to
compete under Wis. Stat. § 103.465 are "subject to common law
contract principles as well as [statutory] requirements." NBZ,
185 Wis. 2d at 836. Section 103.465 "sets forth the
requirements for a[] . . . covenant in an employment contract
but does not address on its face the question of whether a
restrictive covenant must be supported by consideration." Id.
at 835. The court concluded such a covenant requires
consideration because the statute did not "abandon the
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No. 2019AP2095
¶16 The existence of an inconsistency between preprinted
and handwritten contract terms is distinct from contractual
ambiguity; the latter exists if a document is "reasonably or
fairly susceptible of more than one construction." Borchardt v.
Wilk, 156 Wis. 2d 420, 427, 456 N.W.2d 653 (Ct. App. 1990). By
contrast, the presence of an inconsistency or conflict between
terms precludes a reasonable interpretation of the document;
read together, the terms are irreconcilable. See, e.g., Ketay
v. Gorenstein, 261 Wis. 332, 334, 53 N.W.2d. 6 (1952)
(explaining the court cannot "reject certain portions of the
contract" "unless it presents an irreconcilable inconsistency").
The lien waiver in this case cannot be construed as a full
waiver because the handwritten word "Partial" must be given
principles by which a contract is formed in the first instance."
Id. at 837.
So too here. The lien waiver we construe in this case is a
contract, "subject to common law contract principles as well as
[statutory] requirements" under Wis. Stat. § 779.05(1). See
id. at 836. The rule giving controlling effect to handwritten
terms over preprinted contract provisions is neither expressly
abrogated by § 779.05(1) nor in conflict with it, and the
policies underlying the principle are not "irrelevant to the
legislature's choice" to recognize lien waivers as a statutory
matter. See Hinrichs v. DOW Chem. Co., 2020 WI 2, ¶55, 389
Wis. 2d 669, 937 N.W.2d 37 (declining to apply common law
principles because "the policies underlying the economic loss
doctrine——the allocation of risk and the distinction between
tort and contract law——are irrelevant to the legislature's
choice to provide a purely statutory cause of action and remedy
by way of § 100.18"). That "the common law contract
rule . . . is irrelevant" to a non-contractual waiver does not
negate its application to a contractual waiver. See dissent,
¶32.
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No. 2019AP2095
effect. Because the word "Partial" is handwritten, it governs
over the preprinted language waiving all lien rights to date.
¶17 This principle that handwritten terms control over
preprinted provisions "is based on the inference that the
language inserted by handwriting . . . is a more recent and more
reliable expression of [the parties'] intentions than is the
language of a printed form." Edwin W. Patterson, The
Interpretation and Construction of Contracts, 64 Colum. L. Rev.
833, 855 (1964) (citing Restatement, Contracts § 236(e) (1932)).
"Since the parties actually chose to add to or modify the
printed contract, the written terms presumably better reflect
their intention than those contained in a printed contract
intended for general use." 11 Williston on Contracts § 32:13
(4th ed.).
¶18 Consistent with the principle that handwritten terms
control over the form's printed provisions, the term "Partial"
prevails over the language in the printed body of the document
waiving all lien rights to date. Resolving this conflict leaves
no ambiguity as to whether the document is a full or partial
waiver. Because it can be only one or the other, there is no
reasonable alternative construction of the document other than
as a partial waiver.
2. The Waiver is "Specifically and Expressly" Limited to
$33,448
¶19 Concluding that the document is a partial waiver does
not alone resolve the case; ambiguity could exist if the lien
waiver is not specifically and expressly limited to a particular
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No. 2019AP2095
portion of work. This is not so in this case. "Partial"
unambiguously applies to the "particular portion of such labor,
services, materials, plans, or specifications" represented by
the amount of the "$33,448 Dollars" written on the waiver form
and received in consideration for the partial release.8 Wis.
Stat. § 779.05(1).
¶20 Riverworks conceded during oral argument that a waiver
could be limited to a dollar amount, and suggested Great Lakes
could have satisfied Wis. Stat. § 779.05(1) by agreeing "I
hereby waive my lien rights to the extent of X dollars."
Although this would have been a clearer limitation of the
waiver, we decline to adopt such a formulaic reading of
8 The dissent claims our contract construction "rests on the
false premise that when a party receives a certain amount of
money in exchange for a waiver, it must be waiving its lien only
up to that dollar amount," and suggests Great Lakes could have
accepted the $33,448 "in exchange for waiving its lien claims
related to the original contract amount of $37,165" or "any
other dollar amount." Dissent, ¶30. Great Lakes could have
chosen to limit its waiver as the dissent describes, which we
would have honored had the lien waiver document so indicated.
But no such limitation can be reasonably gleaned from the
document before us. The dissent posits purely hypothetical
intentions possibly underlying Great Lakes' addition of
"Partial," which, according to the dissent, make the waiver
ambiguous. In doing so, the dissent reaches beyond the four
corners of the document to introduce ambiguity where it does not
exist. There are myriad ways Great Lakes might have intended to
limit its lien waiver, but we need not consider any of these
speculative iterations because our review is confined to the
four corners of the lien waiver document, which——as the dissent
acknowledges——is "all the property owner has to go on[.]" Id.,
¶26. Confined to its four corners, the lien waiver document in
this case yields but one reasonable interpretation, and while it
does not mirror the model forms reproduced by the dissent, it
nonetheless meets the statutory bar.
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No. 2019AP2095
§ 779.05(1). The statute specifies only that a partial lien
waiver must be "specific[] and express[]."9 The partial waiver
satisfies § 779.05(1) because it is unambiguously partial——
waiving Great Lakes' lien rights only in the amount of "$33,448
Dollars"——an amount representing the "particular portion" of the
work to which the waiver applies.
¶21 In further support of this reading, as of the date the
lien waiver was signed, no one contended that any of the
$222,238 allegedly due to Great Lakes did not cover lienable
work. Prior to 2006, waivers of construction lien rights were
limited to "labor and materials furnished or to be furnished by
the claimant at any time for the improvement to which the waiver
relates[.]" Wis. Stat. § 779.05(1) (2003–04). In 2006, the
legislature amended § 779.05(1) to include "all labor, services,
materials, plans, or specifications performed, furnished, or
procured, or to be performed, furnished, or procured, by the
claimant at any time for the improvement to which the waiver
relates[.]" 2005 Wis. Act 204; § 779.05(1) (2005–06). Because
no party maintains that any portion of the fully completed work
is not lienable, limiting the waiver to a specific dollar value
does not create any additional ambiguity.
Contrary to Riverworks' suggestion at oral argument that
9
we are left to "divine" what portion of work the waiver
attempted to release, no divination is required. Construing the
document as a partial waiver limited to $33,448 is the only
reasonable interpretation of the contract. Interpreting the
waiver before us does not involve the kind of "guessing games"
Riverworks and the dissent assert the statute is designed to
avoid. See dissent, ¶31.
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No. 2019AP2095
¶22 Because we conclude the lien waiver document within
its four corners satisfies the statutory requirements by
specifically and expressly limiting the waiver to the $33,448
Great Lakes received in consideration, we need not decide the
other issues presented, including the propriety of considering
extrinsic evidence of intent, or whether equitable estoppel
precludes Riverworks' claim.
IV. CONCLUSION
¶23 The construction lien waiver document on its face
satisfies the statutory requirements of Wis. Stat. § 779.05(1)
necessary to limit the waiver of Great Lakes' lien rights. The
document "specifically and expressly" restricts the lien waiver
to "a particular portion of such labor, services, materials,
plans, or specifications"——the $33,448 received in consideration
of the waiver.
By the Court.—The decision of the court of appeals is
reversed, and the cause is remanded to the circuit court for
further proceedings consistent with this opinion.
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No. 2019AP2095.rfd
¶24 REBECCA FRANK DALLET, J. (dissenting). This case
presents a straightforward application of a straightforward
statute. The majority's reliance on common law contract
principles is misguided, resulting in a decision at odds with
the legislature's chosen policy regarding construction-lien
waivers. I therefore respectfully dissent.
¶25 Wisconsin Stat. § 779.05(1) provides that if a party
wants to limit a construction-lien waiver to only a portion of
what it's owed, it must "specifically and expressly limit[] the
waiver to apply to a particular portion of [the] labor,
services, materials, plans, or specifications" (emphases added).
Such specificity is necessary because if the party limits the
waiver in an ambiguous way, that ambiguity "shall be construed
against the person signing" the waiver. Id. Without a
specific, express, and unambiguous limitation, the waiver
applies to "all [of that party's] lien rights." Id. (emphasis
added).
¶26 The rationale for both the statute's heightened-
clarity requirement and its presumption in favor of a complete
waiver is rooted in the "reliance placed on waivers by
owners . . . making payouts." See Legislative Council Note,
1967, Wis. Stat. § 289.05.1 Wisconsin allows both general and
subcontractors to file lien claims, regardless of whether the
property owner is aware of the subcontractor's work. Thus, if a
Section 289.05 was eventually renumbered as § 779.05, but
1
the relevant language was unchanged. See § 57, ch. 32, Laws of
1979.
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No. 2019AP2095.rfd
property owner hires a general contractor, who hires a
subcontractor, who hires a subcontractor, that last
subcontractor has the same right to file a construction lien for
its work as does the general contractor. And because a general
contractor, not the property owner, hires and supervises
subcontractors, the owner may not know how much work a
subcontractor has performed or what they are owed for that work.
In addition, the property owner is often not a party to a
construction-lien waiver between contractors. Thus, when a
subcontractor who signed a lien waiver later attempts to
foreclose on a lien, claiming that the waiver was only partial,
all the property owner has to go on is what is within the four
corners of the waiver document. See generally Walter B.
Raushenbush, Wisconsin Construction Lien Law 8–12 (1975). This
explains the statute's requirements that a lien waiver "shall be
deemed to waive all lien rights" unless it "specifically and
expressly limits the waiver to apply to a particular portion" of
the claimant's work. See § 779.05(1); see also Robert J. Smith
et al., Wisconsin Construction Law and Construction Liens 218
(1989) (cautioning that "care should always be taken" when
writing a partial lien waiver because any "attempt to hold back
part of the claimant's rights will be construed against the
claimant").
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¶27 There is no one form a party must use to limit the
scope of its lien waiver, but the following sample forms
demonstrate the specificity required under § 779.05. The State
Bar's Construction Lien Law Handbook contains the following
example:
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Steven W. Martin & Bridget M. Hubing, Wisconsin Construction
Lien Law Handbook app. II at 14 (4th ed. 2019). One of the
statute's drafters offers another option:2
LIMITED WAIVER OF CONSTRUCTION LIEN
For value received, the undersigned hereby waives all
rights to or claims for a lien on the land hereafter
described, for any and all work, materials, plans or
specifications furnished between the ___ day of _____,
[20]__, which was the last day of furnishing any labor
or materials to which this waiver relates, for the
improvement of said lands, said improvements being
done for [owner] by [contractor], said lands being
situated in _____ County, State of Wisconsin, and
described as
follows:___________________________________________.
It is expressly stipulated that this waiver applies
only to work done or materials, plans or
specifications furnished on or before the above-stated
last date of furnishing any labor or materials to
which this waiver relates, and that the work done or
materials furnished by the undersigned for said job on
or before said date was __________________________
[describe]. The amount of compensation due or paid
for such work, for which lien is hereby waived, is
__________ [Here insert the dollar amount of
compensation waived by this partial waiver].
The right to assert construction lien rights for work
done or materials furnished after said date on said
job is hereby expressly reserved.
Walter B. Raushenbush, Wisconsin Construction Lien Law 267–69
(1975). Both sample forms include specific spaces for the lien
claimant to expressly limit the waiver to a certain "percentage
performed, dollar value, and/or dates . . . necessary to
2 See Walter B. Raushenbush, Wisconsin Construction Lien
Law, at iv (1975) (explaining Raushenbush's role in the
statute's drafting process).
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accurately describe the [w]ork to which the [w]aiver relates,
stating exceptions, if any." See Martin & Hubing, supra.
¶28 Great Lakes' waiver stands in stark contrast to those
samples in that it lacks the "careful detailing," see
Raushenbush, supra, at 268–69, of the particular portion of work
covered by the waiver:
The waiver plainly states that Great Lakes waived and released
"any and all" liens or claims related to all of work Great Lakes
"furnished to this date [March 20, 2017]." Great Lakes had
completed all of its work on the Riverworks project in November
2016, so here, "to this date" encompasses the entirety of Great
Lakes' work. The only change Great Lakes made to the waiver was
to the document's title, where it changed "Waiver of Lien to
Date" to "Waiver of Lien Partial."
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¶29 Nowhere, however, does Great Lakes' waiver
specifically and expressly identify what particular "part" of
Great Lakes' lien claims were waived. The waiver is not limited
to a certain dollar amount's worth of services, work completed
up to a certain date (short of the date Great Lakes signed the
waiver), or certain raw materials, for example. Rather, it
expressly states that, in exchange for $33,448, Great Lakes
waived "any and all" lien claims related to all work it had
furnished to date——which, since it had already completed the
project, encompassed the original contract as well as all of the
subsequent change orders. See Tufail v. Midwest Hosp., LLC,
2013 WI 62, ¶26, 348 Wis. 2d 631, 833 N.W.2d 586 (explaining
that courts "construe [an unambiguous] document according to its
literal terms" because we "presume the parties' intent is
evinced by the words they chose"). Accordingly, § 779.05(1)
mandates the court to construe the waiver as waiving all lien
claims.
¶30 Great Lakes argues, and the majority mistakenly
agrees, that because Great Lakes received $33,448 in exchange
for the lien waiver, the waiver applies to $33,448 worth of the
$222,238 Great Lakes claims it was owed for the project. But
that argument rests on the false premise that when a party
receives a certain amount of money in exchange for a waiver, it
must be waiving its lien only up to that dollar amount.3 For
Had Great Lakes intended to limit its waiver to $33,448
3
worth of its services, it could have specifically and expressly
done so by waiving its lien claims "to the extent of $33,448
only of the $222,238 worth of services provided." See Smith,
supra, at 262.
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example, Great Lakes could have accepted AMCON's $33,488 payment
in exchange for waiving its lien claims related to the original
contract amount of $37,165. Or Great Lakes could have accepted
$33,488 to waive its lien claims related to any other dollar
amount. The point is: we don't know.4 And given that every
other term in the document indicates a complete waiver,
interpreting it as such is the only option.
¶31 Great Lakes also argues that its handwritten edit
reflects its and AMCON's intent for the waiver to be a partial
one, and therefore Riverworks (who hired AMCON) should be held
to that understanding. The problem with that argument is two-
fold. First, Riverworks was not a party to the waiver and the
record does not indicate that AMCON was Riverworks' agent, such
that Riverworks would be bound by AMCON's actions. See Romero
v. W. Bend Mut. Ins. Co., 2016 WI App 59, ¶38, 371 Wis. 2d 478,
885 N.W.2d 591 (summarizing general agency principles). Plus,
because Riverworks was not a party to the waiver, it has no way
of knowing what Great Lakes intended other than by reading the
document——which says that Great Lakes waived "any and all" lien
claims for all of its work. See Tufail, 348 Wis. 2d 631, ¶26.
Second, even if crossing out "to date" and writing "partial" in
the title is enough to indicate that Great Lakes and AMCON
intended the document to waive only part of Great Lakes' lien
4All we can do is guess about what Great Lakes' handwritten
edit to the waiver's title means. But even if we knew what
"partial" meant, it would still be at odds with the rest of the
waiver's text, making the waiver at best ambiguous. And
§ 779.05(1) requires the court to resolve any ambiguity against
Great Lakes.
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claims, we——and Riverworks——are still left to guess the
particular portion of work to which Great Lakes is waiving its
lien claims. The point of § 779.05(1), however, is to eliminate
such a guessing game from how courts or third-parties understand
a lien waiver. As one of the statute's drafters explained, the
statute tilts heavily in favor of construing lien waivers as
waiving all lien claims because other, less stringent
possibilities present "serious problems of proof" regarding the
portion of work to which a partial waiver would apply.
Raushenbush, supra, at 102–03. Great Lakes' position would
circumvent the statute's text and must therefore be rejected.
¶32 Instead of focusing on the text of § 779.05(1), the
majority wrongly relies upon default principles of contract law.
It claims that the handwritten "term" places the waiver in
irreconcilable conflict with itself, and therefore we must apply
the common law rule that a handwritten provision controls over a
conflicting printed provision. For starters, Great Lakes did
not change a "term" of the contract; it changed part of the
title while leaving all of the substantive terms unchanged. But
more importantly, common law contract rules are irrelevant here
because a construction lien is a "purely statutory right" that
"cannot be maintained" outside of the relevant statutory rules.
See Goebel v. Nat'l Exchangors, Inc., 88 Wis. 2d 596, 606, 277
N.W.2d 755 (1979) (quoting Rees v. Ludington, 13 Wis. 308,
311-12 (1860); Scott v. Christianson, 110 Wis. 164, 167, 85
N.W. 658 (1901) ("The lien being purely a statutory right, it
must be pursued as the statute directs, or it fails.").
Section 779.05 provides the statutory rule for how to construct
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and interpret lien waivers. Under that rule, a waiver is
binding even without consideration——that is, even if the waiver
is not a contract.5 Accordingly, the common law contract rule
the majority references is irrelevant. See Goebel, 88 Wis. at
606; see also Hinrichs v. DOW Chem. Co., 2020 WI 2, ¶55, 389
Wis. 2d 669, 937 N.W.2d 37 (explaining that common law
principles are "irrelevant" when the legislature enacts a
statute directly addressing the same issue).
¶33 Concluding that Great Lakes waived all of its lien
claims would undoubtedly be a harsh result. But just because
Great Lakes waived its lien claims does not mean that it can't
try to recover what it's owed under the construction contract.
See § 779.05(1) (explaining that a lien waiver "is a waiver of
lien rights only, and not of any contract rights of the claimant
otherwise existing"). Moreover, the legislature has made the
policy choice that construction-lien waivers should be treated
as complete waivers unless they contain specific and express
limitations. The legislature can change that policy by amending
the statute to allow a party to limit a waiver in the way Great
Lakes attempted to here. See Kohn v. Darlington Cmty. Schs.,
2005 WI 99, ¶43, 283 Wis. 2d 1, 698 N.W.2d 794. As § 779.05(1)
reads now, Great Lakes' claim fails. I would therefore affirm
the court of appeals' decision.
5Although a waiver doesn't have to be a contract, Great
Lakes' waiver is one because it gave up something of value——all
of its lien claims——in exchange for consideration. But the
lien-waiver statute applies whether or not the lien waiver is a
contract. See Goebel, 88 Wis. at 606; Christianson, 110 Wis. at
167.
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¶34 I am authorized to state that Justice ANN WALSH
BRADLEY joins this opinion.
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