Insurance Coverage – Homestead Property

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WI Court of Appeals – District III

Case Name: Auto Owners Insurance Company v. The Estate of Michael Janey, et al.

Case No.: 2017AP1754

Officials: Stark, P.J., Hruz and Seidl, JJ.

Focus: Insurance Coverage –  Homestead Property

David Mader appeals a summary judgment granted in favor of Martha Janey and an order denying his motion for reconsideration. Martha’s husband, Michael Janey, settled a dispute with Mader by granting Mader a note secured by a mortgage (the “Mader mortgage”) that encumbered three properties: the Janeys’ homestead property and two non-homestead properties they owned. A subsequent fire at one of the non-homestead properties led to an insurance coverage dispute that ultimately involved the Janeys, their insurer— Auto-Owners Insurance Company (Auto-Owners)—and multiple third-party creditors, including Mader.

This appeal addresses three issues that arose out of the insurance coverage dispute. More specifically, it addresses the following issues presented by Martha’s successful challenge to the validity of the Mader mortgage: (1) whether Martha has standing to challenge the validity of the Mader mortgage by invoking the homestead protections afforded by WIS. STAT. § 706.02(1)(f) (2017-18), even though her interest in the homestead property encumbered by the mortgage has been extinguished by a mortgage foreclosure in a separate action by U.S. Bank; (2) whether the Mader mortgage is void in its entirety for failing to satisfy the signing requirement of § 706.02(1)(f); and (3) if the Mader mortgage is void in its entirety, whether it may nevertheless be reformed under the equitable relief provisions of WIS. STAT. § 706.04.

We conclude that: (1) Martha has standing to assert that the Mader mortgage is void under WIS. STAT. § 706.02(1)(f), regardless of her current interest in the homestead property encumbered by that mortgage, because she has a present interest in showing that the mortgage was void ab initio; (2) the Mader mortgage is void in its entirety because it was a single conveyance that failed to satisfy § 706.02(1)(f); and (3) the Mader mortgage may not be equitably reformed. Accordingly, we affirm.

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.