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Tikalsky v. Friedman

Supreme Court of Wisconsin

May 23, 2019

J. Steven Tikalsky, Plaintiff-Appellant,
v.
Susan Friedman a/k/a Susan Tikalsky, James Tikalsky and Amended and Restated Donald and Betty Lou Tikalsky Revocable Trust, Defendants, Terry Stevens, Defendant-Respondent-Petitioner.

          SUBMITTED ON BRIEFS, ORAL ARGUMENT: November 7, 2018

          Source of Appeal Circuit Court Waukesha County, L.C. No. 2015CV1733, Maria S. Lazar Judge.

         REVIEW OF DECISION OF THE COURT OF APPEALS Reported at 382 Wis.2d 830, 917 N.W.2d 232

          For the defendant-respondent-petitioner, there were briefs filed by Dean P. Laing, and O'Neil, Cannon, Hollman, DeJong & Laing S.C., Milwaukee. There was an oral argument by Dean P. Laing.

          For the plaintiff-appellant, there was a brief filed by Mark J. Mingo and Mingo Yankala, S.C., Milwaukee; with whom on the brief was Thomas C. Armstrong and Cabaniss Law, Milwaukee. There was an oral argument by Mark J. Mingo.

          DANIEL KELLY, J.

         ¶1 In a vigorous dispute over the distribution of Donald and Betty Lou Tikalsky's estate, J. Steven Tikalsky sued his sister, Terry Stevens, to obtain part of the inheritance she received from their parents. His Complaint contains a count labeled "constructive trust," which he deployed against his sister as a cause of action. Terry Stevens asks us whether a "constructive trust" may play that role, and whether it may be used against those who have engaged in no inequitable behavior. We hold that a constructive trust is a remedy, not a cause of action. We also hold that, under the proper circumstances, a constructive trust may be imposed on property in the possession of one who is wholly innocent of any inequitable conduct. But because the Complaint in this case does not state a cause of action against Terry Stevens, nor assert any other grounds upon which a constructive trust could be imposed, the circuit court properly dismissed her from the case with prejudice. We reverse the court of appeals' decision reversing the circuit court.[1]

         I. BACKGROUND

         ¶2 Donald and Betty Lou Tikalsky (jointly, the "Tikalskys", and individually, "Mr. Tikalsky" and "Mrs. Tikalsky," respectively) jointly developed an estate plan that included the "Donald J. Tikalsky and Betty Lou Tikalsky Revocable Trust dated January 15, 1999" (the "1999 Trust"), as well as two associated wills (the "Wills") . The 1999 Trust and Wills provided that, when the Tikalskys had both passed, the bulk of their estate would be divided equally between their four children: J. Steven Tikalsky ("Steven"); Susan Friedman ("Susan"); Terry Stevens ("Terry"); and James Tikalsky ("James").[2]

         ¶3 A few years after execution of the 1999 Trust and Wills, the relationship between Steven and his parents started deteriorating. Eventually, they became estranged. A succession of amendments to the estate planning documents followed. In 2007, the Tikalskys executed the "Donald J. Tikalsky and Betty Lou Tikalsky Revocable Trust" (the "2007 Trust") as a replacement for the 1999 Trust.[3] Unbeknownst to Steven, the 2007 Trust provided that "J. Steven Tikalsky and his children are intentionally left out of this bequest or any bequest under this document." The Tikalskys amended the 2007 Trust in 2008; the amendment provided that "[i]t is the intent of Donald J. Tikalsky and Betty Lou Tikalsky that J. Steven Tikalsky be eliminated completely from this Trust or any Wills or the estate of the parties."[4] The Tikalskys amended and restated the 2007 Trust the final time in April of 2009. Mr. Tikalsky died approximately five months later, at which time Steven first learned that his parents had disinherited him and his family. Mrs. Tikalksy died in 2014, five years after her husband.

         ¶4 Steven believes two of his siblings, Susan and James, wrongfully caused his estrangement from his parents and his subsequent disinheritance. His Complaint seeking redress for the latter injury named not just Susan and James as defendants, but Terry as well.[5] Steven asserted nine claims: (1) a request for a declaration that his parents lacked capacity to execute their respective testamentary documents; (2) a request for a declaration that Susan and James exercised undue influence over his parents in the drafting and execution of their testamentary documents; (3) intentional interference with expected inheritance; (4) common law conversion/fraud; (5) statutory theft in violation of Wis.Stat. §§ 895.446 (2015-16)[6] and 943.20; (6) unjust enrichment; (7) civil conspiracy; (8) punitive damages; and (9) constructive trust. The cardinal numbers in this list correspond to the numbered causes of action in Steven's Complaint. As we trace the disposition of each of these counts, we will maintain the cardinal number associated with each one to assist with clarity.

         ¶5 After his siblings moved for summary judgment, Steven voluntarily dismissed five of the Complaint's nine counts and acknowledged that "punitive damages" is not a cause of action.[7]Consequently, when the circuit court considered the summary judgment motion, the remaining claims were: (2) undue influence; (3) intentional interference with expected inheritance; and (9) constructive trust. Neither count two nor three alleged anything against Terry. The ninth count (constructive trust) referred to Terry only obliquely (inasmuch as she was one of the defendants):

143. The funds that constituted a one-quarter share in Donald and Betty Lou's joint estate plan and were converted from Steven to the defendants were at all times after the conversion held by the defendants in constructive trust for Steven.
144. Steven therefore now holds a beneficial property interest in all funds converted by the defendants. To the extent that the defendants spent or otherwise disposed of funds since the conversion beginning in or around April 8, 2009, a legal presumption exists that the funds spent came from monies other than those funds converted, and that any assets now in the defendants' possession are the subject of Steven's constructive trust to the maximum extent. In addition, the converted funds remain in constructive trust in the hands of all persons who knew or had reason to know the funds were converted.

         ¶6 The circuit court granted summary judgment against Steven on counts two (undue influence) and nine (constructive trust). With respect to dismissal of the claim for constructive trust, the circuit court said:

Plaintiff Steven urges the Court to keep the constructive trust cause of action because the defendants were unjustly enriched and he is, therefore, entitled to the equitable remedy of a constructive trust. But as just noted by the Defendants, Plaintiff Steven voluntarily dismissed his unjust enrichment cause of action. So accordingly this cause of action for constructive trust is unsupported. Summary judgment dismissing this cause of action is granted.

         ¶7 The circuit court denied the summary judgment motion with respect to count three (intentional interference with expected inheritance), which left this as the sole remaining claim in the case. Because this count asserted nothing against Terry, the circuit court dismissed her from the lawsuit with prejudice. The order of dismissal was final as to Terry, and Steven appealed in due course.[8]

         ¶8 Steven named Terry as the only respondent; neither of his other siblings participated in the appeal in any capacity. The sole issue he presented to the court of appeals was the circuit court's dismissal of count nine (constructive trust) as against Terry. The "Statement Of The Issue" in his opening brief asked: "Did the trial court err in dismissing Steven Tikalsky's cause of action seeking to impose a constructive trust on inheritance alleged to be wrongfully distributed to the defendant Terry Stevens, on the basis that Steven Tikalsky previously dismissed his cause of action for unjust enrichment?" The circuit court did err, the court of appeals said. Although the cause of action for unjust enrichment was gone, the court of appeals concluded that Steven had nevertheless "presented enough material on summary judgment to continue seeking a constructive trust." Tikalsky v. Stevens, No. 2017AP170, unpublished slip op., ¶2 (Wis. Ct. App. May 30, 2018) . According to the court of appeals, a constructive trust remained as a "permissible equitable remedy" as to Terry because Steven alleged "some measure of untoward conduct on the part of Susan and James," and therefore "the factual claims undergirding the potential remedy of a constructive trust have been sufficiently established at this stage of the proceedings." Id. The court of appeals reversed the circuit court's order dismissing Terry from the case. Id.

         ¶9 We granted Terry's petition for review and now reverse the court of appeals.

         II. STANDARD OF REVIEW

         ¶10 We review the disposition of a motion for summary judgment de novo, applying the same methodology the circuit courts apply. Green Spring Farms v. Kersten, 136 Wis.2d 304, 315, 401 N.W.2d 816 (1987); Borek Cranberry Marsh, Inc. v. Jackson Cty., 2010 WI 95, ¶11, 328 Wis.2d 613, 785 N.W.2d 615 ("We review the grant of a motion for summary judgment de novo . . . ."). While our review is independent from the circuit court and court of appeals, we benefit from their analyses. See Preisler v. General Cas. Ins. Co., 2014 WI 135, ¶16, 360 Wis.2d 129, 857 N.W.2d 136.

         ¶11 "The first step of that [summary judgment] methodology requires the court to examine the pleadings to determine whether a claim for relief has been stated." Green Spring Farms, 136 Wis.2d at 315. "In testing the sufficiency of a complaint, we take all facts pleaded by plaintiff [] and all inferences which can reasonably be derived from those facts as true." Id. at 317. And we liberally construe pleadings "with a view toward substantial justice to the parties." Id. (citing Wis.Stat. § 802.02(6)).

         ¶12 Under the second step of this methodology, "[i]f a claim for relief has been stated, the inquiry then shifts to whether any factual issues exist." Id. at 315. Summary judgment is appropriate only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Wis.Stat. § 802.08(2); see also Columbia Propane, L.P. v. Wis. Gas Co., 2003 WI 38, ¶11, 261 Wis.2d 70, 661 N.W.2d 776 (quoting and applying Wis.Stat. § 802.08 (2) (2001-02)).

         III. ANALYSIS

         ¶13 Terry says the circuit court correctly dismissed her from the case because the Complaint's only claim against her was for a constructive trust. This is a remedy, not a cause of action, she says, and the former may not be imposed in the absence of the latter. Steven says a constructive trust's legal taxonomy is of no moment; all that matters is whether the facts presented at summary judgment justify its imposition. The court of appeals agreed: "Though the parties spend considerable time debating whether constructive trust should be labeled a cause of action or a remedy, the answer to that question is largely immaterial." Tikalsky, 2017AP170, unpublished slip op., ¶7.

         ¶14 At the most basic level, Steven and the court of appeals are right. A complaint's success does not depend on accurate labeling. When we "examine the pleadings to determine whether a claim for relief has been stated," Green Spring Farms, 136 Wis.2d at 315, we focus on the factual allegations, not the plaintiff's characterization of their legal significance.[9]Shelstad v. Cook, 77 Wis.2d 547, 553, 253 N.W.2d 517 (1977) ("The theory of the plaintiff's case is not controlling. A plaintiff is bound by the facts alleged, not by his theory of recovery.") . Not even misidentifying the cause of action will distract us from our independent assessment of the factual allegations' legal consequences: "Neither any misstatement as to the precise nature of the wrong, as classible by common law names, or misstatement as to the kind of relief, or mere indefiniteness of statement are of any particular moment, as regards either sufficiency of cause or proper joinder of causes of action." Weinstein v. McCabe, 43 Wis.2d 76, 80, 168 N.W.2d 210 (1969). See also Bieri v. Fonger, 139 Wis. 150, 153, 120 N.W. 862 (1909) ("If facts are stated constituting a good cause of action, though not the one the pleader intended, the pleading is good as against a general demurrer.") .[10]

         ¶15 While Steven is right about our responsibility to look past labels, that does not mean we may treat causes of action and remedies as if they were the same thing. It just means we do not depend on the complaint to properly label the claims or to marshal the supporting facts into a logically cogent grouping. Even as we look past such formalities, we still distinguish between causes of action and remedies: "A cause of action is distinguished from a remedy which is the means or method whereby the cause of action is effectuated." Goetz v. State Farm Mut. Auto Ins. Co., 31 Wis.2d 267, 273-74, 142 N.W.2d 804 (1966) (citation omitted), [11]

         ¶16 The distinction is important, especially at the summary judgment stage, because the court must determine whether the alleged facts comprise one or more causes of action. The substantive law governing a cause of action tells us what types of facts a plaintiff must allege. If the facts satisfy all of the constitutive elements of the claim, then the complaint has stated a good cause of action and the analysis may proceed to the second step in the summary judgment methodology:

To state a claim upon which relief may be granted, the plaintiff's allegations must be informed by the theory of liability: "In sum, Twombly[12] makes clear the sufficiency of a complaint depends on [the] substantive law that underlies the claim made because it is the substantive law that drives what facts must be pled. Plaintiffs must allege facts that plausibly suggest they are entitled to relief."

Springer v. Nohl Elec. Prod. Corp., 2018 WI 48, ¶35, 381 Wis.2d 438, 912 N.W.2d 1');">912 N.W.2d 1 (quoting Data Key Partners v. Permira Advisers LLC, 2014 WI 86, ¶31, 356 Wis.2d 665, 849 N.W.2d 693). See also Val-Lo-Will Farms, Inc. v. Irv Azoff & Assocs., Inc., 71 Wis.2d 642, 644, 238 N.W.2d 738 (1976) ("A cause of action is defined as an aggregate of operative facts giving rise to a right or rights termed 'right' or 'rights of action' which will be enforced by the courts." (citation and some internal marks omitted)). The cause of action is important, therefore, because it is the standard against which we measure the sufficiency of the complaint's factual allegations.

         ¶17 As we assay Steven's Complaint for a cause of action, we will proceed in two steps. First, we will determine whether "constructive trust" is a cause of action or, instead, a remedy. Second, we will review Steven's Complaint to determine whether the alleged facts, without regard to the labels, comprise a cause of action against Terry. The first step is necessary because if "constructive trust" is a cause of action, we need to identify its substantive elements so that, in the second step, we may determine whether the alleged facts satisfy its terms. If "constructive trust" is not a cause of action, however, then we must determine whether the Complaint nonetheless alleges a set of facts that comprises some other cause of action that might warrant imposition of a constructive trust on property in Terry's possession.

         A. "Constructive Trust" Is A Remedy

         ¶18 Our first step begins with a brief word about the nature of constructive trusts. This will not only help illuminate its essential function (remedy versus cause of action), it will also lay the groundwork for understanding the circumstances in which it is available as against innocent owners. Conceptually, a constructive trust is an equitable device used to address situations in which the legal and beneficial interests in a particular piece of property lie with different people. Under proper circumstances-more about that later-the beneficial owner may ask the court to impose a constructive trust on the property. Hanson v. Valdivia, 51 Wis.2d 466, 476, 187 N.W.2d 151 (1971) ("A constructive trust can only be applied to some specific res [that is, property] to which the party has acquired legal title."). The purpose of a constructive trust is to protect the beneficial owner against the legal owner: "Such a trust is implied by operation of law as a remedial device for the protection of a beneficial interest against one who . . . holds the legal title to property which he ought not in equity and in good conscience beneficially enjoy." Bautista v. Schneider, 16 Wis.2d 304, 312, 114 N.W.2d 449');">114 N.W.2d 449 (1962) . In operation, a constructive trust reunites the beneficial and legal ownership interests in the same person. "By means of this device, the person equitably entitled to the res becomes the cestui que trust[13] and may obtain possession from the wrongful holder, the constructive trustee." Richards v. Richards, 58 Wis.2d 290, 297, 206 N.W.2d 134');">206 N.W.2d 134 (1973) . See also Zartner v. Holzhauer, 204 Wis. 18, 21, 234 N.W. 508 (1931), overruled on other grounds by Glojek v. Glojek, 254 Wis. 109, 35 N.W.2d 203 (1948) ("It is well established that equity will afford relief at the suit of heirs to place them in possession of, or to quiet their title in, real property, the legal title to which is held by another, under circumstances giving rise to a constructive trust."); Restatement (Third) of Restitution and Unjust Enrichment § 55 cmt. b (2011) ("Constructive trust is a flexible device by which a court directs that property to which B holds legal title be transferred to A.").

         ¶19 With those general principles as background, we can recognize the first clue that a constructive trust is a remedy, not a cause of action: it functions as a means of repairing divided ownership interests, not as a means of determining whether they are in need of repair. It is for the "protection of a beneficial interest," Bautista, 16 Wis.2d at 312 (emphasis added), as opposed to determining who owns that interest. It allows the beneficial owner to "obtain possession from the wrongful holder," Richards, 58 Wis.2d at 297, but it does not establish the wrongfulness of the holding. It allows the court to "direct[] that property to which B holds legal title be transferred to A," Restatement (Third) of Restitution and Unjust Enrichment § 55 cmt. b, but it does not provide the basis for ousting party B from his legal title. Constructive trust is a kinetic device that operates on a presupposed liability. And that leads us to the second clue, which is embedded in the way we talk about that presupposition.

         ¶20 We commonly say that "[a] constructive trust is imposed by a court of equity to prevent unjust enrichment arising when one party receives a benefit the retention of which would be unjust as against the other." Prince v. Bryant, 87 Wis.2d 662, 667, 275 N.W.2d 676');">275 N.W.2d 676 (1979) . When we speak of "constructive trust" and "unjust enrichment," the pattern matches what we described in Goetz, in which we said a "remedy" is "the means or method whereby the cause of action is effectuated." Goetz, 31 Wis.2d at 273. In other words, we determine whether the defendant owes the plaintiff an enforceable duty, and then we identify a method by which to actualize it. We used that exact formulation in Schmalz v. McKenna: "'Where a person holding title to property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if he were permitted to retain it, a constructive trust arises.'" 58 Wis.2d 220, 228, 206 N.W.2d 141');">206 N.W.2d 141 (1973) (quoting Restatement (First) of Restitution § 160 (1937)). See also Warsco v. Oshkosh Sav. & Tr. Co., 190 Wis. 87, 90-91, 208 N.W. 886 (1926) ("'Whereever [sic] one person has wrongfully taken the property of another, and converted it into a new form, or transferred it, the trust arises and follows the property or its proceeds.'[14] It appears to us that the foregoing quotation from Pomeroy not only constitutes good logic, but sound law.") (emphasis omitted). A constructive trust is what arises when the defendant violates an antecedent duty that will leave him unjustly enriched. It is the defendant's obligation to perform the duty that is the cause of action. The constructive trust exists for the purpose of providing a remedy when he fails to do so.

         ¶21 As an aside, it is important to note that although proving unjust enrichment means the plaintiff is entitled to a remedy, it does not necessarily entitle him to this remedy. After establishing unjust enrichment, the plaintiff must next demonstrate that a constructive trust is warranted. "A constructive trust will be imposed only in limited circumstances." Wilharms v. Wilharms, 93 Wis.2d 671, 678-79, 287 N.W.2d 779');">287 N.W.2d 779 (1980) . The limitation to which Wilharms refers is the "additional showing" a plaintiff must undertake before he may have this remedy:

Despite the suggestion of this rule[15] that unjust enrichment alone will give rise to a constructive trust, however, the decisions of this court have consistently required an additional showing. A constructive trust will be imposed only where, by means of ". . . actual or constructive fraud, duress, abuse of confidence, mistake, commission of a wrong, or by any form of unconscionable conduct," the one against whom the trust is imposed "has either obtained or holds the legal title to property which he ought not in equity and in good conscience beneficially enjoy . . . [.]"

Gorski v. Gorski, 82 Wis.2d 248, 254-55, 262 N.W.2d 120 (1978) (quoting Baustista, 16 Wis.2d at 312) . See also Prince, 87 Wis.2d at 667 (explaining the factors that must be shown in addition to unjust enrichment include "actual or constructive fraud, duress, abuse of confidential relationship, mistake, commission of a wrong or any form of unconscionable conduct."); Meyer v. Ludwig, 65 Wis.2d 280, 285-86, 222 N.W.2d 679');">222 N.W.2d 679 (1974) ("[B]oth cases[16] go beyond the unjust enrichment-only test, suggested by the Restatement rule, to require something additional [such as] . . . 'duress, abuse of confidence, mistake, commission of a wrong, or by any form of unconscionable conduct . . . . "); Masino v. Sechrest, 268 Wis. 101, 107, 66 N.W.2d 740 (1954) ("The underlying principle of a constructive trust is the equitable prevention of unjust enrichment which arises from fraud or the abuse of a confidential relationship. 'A constructive trust arises if, but only if, it is shown that the transferee was guilty of fraud or the abuse of a confidential relationship, or if the transfer was made in contemplation of death, or is in the nature of a mortgage.' Scott on Trusts, vol. 3, § 481.3, 2358."). Therefore, Steven is not entitled to a constructive trust as a remedy unless he can prove unjust enrichment and the "additional showing" described in Gorski.

         ¶22 We recognize we have not been entirely consistent in identifying a constructive trust as a remedy. Certainly, there have been times that we have explicitly recognized it as such. See, e.g., Prince, 87 Wis.2d at 667-68 ("Since the doctrine of constructive trust is an equitable remedy . . . ."); Pluemer v. Pluemer, 2009 WI.App. 170, ¶9, 322 Wis.2d 138, 776 N.W.2d 261 ("A constructive trust is an equitable remedy imposed to prevent unjust enrichment."); Conn. Gen. Life Ins. Co. v. Merkel, 90 Wis.2d 126, 130, 279 N.W.2d 715');">279 N.W.2d 715 (Ct. App. 1979) ("A constructive trust is an equitable remedy . . . .") . But at other times, we have left the impression it is a cause of action. See, e.g., Gorski, 82 Wis.2d at 254 ("the amended complaint does allege facts sufficient to support a cause of action on the theory of a constructive trust."); see also Demos v. Carey, 50 Wis.2d 262, 269, 184 N.W.2d 117 (1971) ("[T]he facts alleged ... do not state a cause of action for constructive trust."). To remove any confusion about the matter, we conclude that a constructive trust is a remedy, not a cause of action. In doing so, we join the overwhelming majority of our sister jurisdictions who have addressed this question.[17]

         B. Persistency of Constructive Trusts

         ¶23 Conceptually, there are two potential paths by which a person may pursue a constructive trust against property in another's possession. First, the plaintiff may directly assert a claim against the defendant (as described above) claiming she has been unjustly enriched and that the circumstances by which the unjust enrichment arose satisfy the "additional showing" described by Gorski. Or second, the plaintiff may prove that the defendant came into possession of property that was already burdened with a constructive trust.

         ¶24 Once a constructive trust exists, it travels with the property to which it attaches. So, as long as the plaintiff can trace the property from one person to the next, he may have this remedy until the property comes into the hands of a bona fide purchaser for value and without notice of the claim:

[E]quity impresses a constructive trust upon the new form or species of property, not only while it is in the hands of the original wrongdoer, but as long as it can be followed and identified in whosesoever hands it may come, except into those of a bona fide purchaser for value and without notice ....

Warsco, 190 Wis. at 90 (quoting 3 Pomeroy, Equity Jurisprudence (4th Ed.) pp. 2397-2401) (emphasis omitted)). See also Richards, 58 Wis.2d at 298 ("'Where a person holding property transfers it to another in violation of his duty to a third person, the third person can reach the property in the hands of the transferee (by means of a constructive trust) unless the transferee is a bona fide purchaser.'") (quoting 5 Scott, Law of Trusts (3d ed.), p. 3444, § 470). If the property reaches the hands of a bona fide purchaser for value, the constructive trust attaches to the proceeds from the purchase. "As a necessary consequence of this doctrine, whenever property subject to a trust is wrongfully sold and transferred to a bona fide purchaser, so that it is freed from the trust, the trust immediately attaches to the price or proceeds in the hands of the vendor . . . ." Warsco, 190 Wis. at 90 (quotation omitted).

         C. Steven's Complaint

         ¶25 Armed with these principles, we are now ready to scrutinize Steven's Complaint for a cause of action capable of implicating the property in Terry's possession. As we discussed above, we will not be captured by labels as we do so, but neither will we rewrite Steven's Complaint. He is the master of his pleadings. Nor will we countermand his strategic calculations, such as his affirmative decision to dismiss certain causes of action. It is not for us to resurrect what he has let go. We will consider the Complaint from two perspectives. First, we will determine whether it pleads a cause of action directly against Terry. Second, we will consider whether it pleads a cause of action against one of her siblings that could potentially call into question her ownership of the inheritance she received from her parents.

         1. Claims Against Terry

         ¶26 We begin by determining whether the Complaint states a cause of action against Terry. As filed, two sections of the Complaint made allegations that relate to her potential liability to Steven. In one of them, the Complaint claimed Terry had been unjustly enriched as a consequence of her siblings' representations and conduct, the result of which was that she received one-third of her parents' estates instead of one-quarter (count six-unjust enrichment). As we described above, unjust enrichment is the cause of action for which a constructive trust is a potentially available remedy. However, we are analyzing the Complaint not as it was filed, but as it was presented to the circuit court on the defendants' motion for summary judgment. In response to that motion, Steven explicitly dismissed his unjust enrichment claim against all of the defendants.[18] Consequently, count six (unjust enrichment) is no longer an operable part of the Complaint and is therefore incapable of asserting a cause of action against Terry.

         ¶27 The other section of the Complaint containing factual allegations against Terry is count nine (constructive trust). There, the Complaint says "the defendants" converted Steven's one-quarter share of their parents' estates, such that each of them should be considered to be holding Steven's share of the inheritance as a constructive trust (count nine). Because we construe pleadings liberally in the first step of the summary judgment methodology, we will understand Steven's reference to "defendants" to assert that Terry, as well as Susan and James, converted his share of the inheritance.[19] Count nine does not itself describe the conversion; instead, Steven placed those allegations in count four (common law conversion/fraud), in which he says that through "Susan and James' false and fraudulent representations and conduct described above, amongst others, Susan and James caused funds to be diverted from Steven to themselves." Even if we could consider this an inartfully drawn claim of unjust enrichment, it would suffer the same fate as the actual claim of unjust enrichment: Steven dismissed it in response to Terry's motion for summary judgment.[20] With count four voluntarily dismissed, there is nothing in the Complaint to give meaning to the allegation of "conversion" in count nine. So nothing in count nine is capable of serving as an operable cause of action against Terry.

         ¶28 For these reasons, the Complaint does not plead any cause of action directly against Terry. So we must next determine whether the remaining claims Steven made against Susan and James might give him a right to impress a constructive trust on the inheritance Terry received from their parents.

         2. Claims Against Others That Might Implicate Terry

         ¶29 The two remaining claims presented to the circuit court on summary judgment were count two (undue influence) and count three (intentional interference with expected inheritance) . The circuit court dismissed count two, and Steven did not challenge that decision either in the court of appeals or here. So the only remaining cause of action for us to consider is for "intentional interference with expected inheritance." In this section of his Complaint, Steven alleged that:

Susan and James intentionally interfered with Steven's expected inheritance through the exercise of undue influence on Donald and Betty Lou and other bad faith conduct, including the orchestration of the preparation and execution of the Last Will and Testament of Donald J. Tikalsky and the Amended and Restated Donald J. Tikalsky and Betty Lou Tikalsky Revocable Trust dated April 8, 2009, along with any other legal documents prepared for and executed by either Donald or Betty Lou on, about or subsequent to that date.

         He also alleged that "[b]ut not [sic] for Susan and James' conduct described above, Donald and Betty Lou would have left a legacy to Steven equal to that of the legacy left to each of their other three issue."[21]

         ¶30 So Steven's challenge here is to explain how the allegations in his "intentional interference" claim can provide a vehicle by which he can reach property in Terry's possession.[22]Because these facts do not charge her with any culpable conduct, Steven turns to our "innocent beneficiary" line of cases to argue that he may have access to property in her hands notwithstanding the fact that she has engaged in no inequitable behavior. However, the circumstances he describes in his Complaint do not fit the contours of the innocent beneficiary doctrine.

         ¶31 Our opinion in Richards provides a good illustration of the situations that call for constructive trusts on property in the hands of innocent beneficiaries. Richards, 58 Wis.2d at 290. There, Mr. Richards was subject to a divorce decree that required him to name his minor children as beneficiaries of certain life insurance policies. Id. at 292. After he remarried, he designated his new wife as the beneficiary. Id. We recognized that he who pays the premium of a life insurance policy gets to name the beneficiary. Id. at 293. But we also said that the divorce decree created in the children an equitable right to the insurance proceeds: "[A]lthough a divorce judgment does not expressly prohibit the owner of an insurance policy from changing the beneficiary, the decree of the court is to be given the effect of a continuing obligation to carry out the provisions set forth therein." Id. at 296. Therefore, when Mr. Richards changed the life insurance beneficiary, he was conveying a property interest to his wife that was already freighted with a constructive trust. We said "the mere ignorance of the recipient of the original impropriety did not make the recipient an innocent purchaser or, as contemplated in the rules stated by Scott on Trusts, a bona fide purchaser." Id. at 298.

         ¶32 The general rule we gleaned from this was that "'[w]here a person holding property transfers it to another in violation of his duty to a third person, the third person can reach the property in the hands of the transferee (by means of a constructive trust) unless the transferee is a bona fide purchaser.'" Id. at 298 (citation omitted). This rule does not dispense with the need to prove unjust enrichment or establish Gorski's "additional showing." When this pattern occurs, it is clear that the innocent beneficiary "was, in fact, enriched, although not because of any unconscionable conduct on her part." Prince, 87 Wis.2d at 668. The "additional showing" required by Gorski, in these situations, is resident in the violation of the transferor's obligation to a third person: "[A] change of beneficiary in violation of an express provision of a divorce judgment is a sufficient additional factor," as is "a change of beneficiary in violation of an express promise supported by consideration . . . ." Id. at 670. The constructive trust attaches to the property in the transferor's hands, following which our normal rules about the persistency of trusts (see supra III.B) come into play, which allow the third party to reach the property in the hands of all transferees until it comes into the possession of a bona fide purchaser for value.

         ¶33 Steven's Complaint does not fit this pattern. The Richards rule contemplates the owners of the property conveying it to an innocent beneficiary in violation of a duty to transfer it to the plaintiff. Steven imagines himself to be in the place of the person to whom the duty is owed, while Terry stands in for the innocent beneficiary. Steven's Complaint does not describe a Richards scenario because it was the Tikalskys, not Susan and James, who transferred the property in question to Terry. And the Tikalskys owed Steven no duty to make him a beneficiary of their estates. See Bautista, 58 Wis.2d at 229; see also Olszewski v. Borek, 254 Wis. 153, 157, 35 N.W.2d 209 (1948), on reh'g, 254 Wis. 153, 35 N.W.2d 911 (1949) ("It has often been held by this court that one of the most important rights that a normal adult person has is his power to dispose of his property by will as he chooses. In fact, it has been referred to by this court as a 'sacred right' and one that is guaranteed by the constitution."); Schaefer v. Ziebell, 207 Wis. 404, 410, 241 N.W. 382 (1932) ("One of the most important rights that a person of full age, mature mind, and disposing memory enjoys is the absolute right to dispose of his property by will as he may choose.") . So the Tikalskys violated no duty to Steven when they caused their estate planning documents to transfer part of their estates to Terry. And in the context of ...


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