                                                                2016 WI 30

                  SUPREME COURT              OF      WISCONSIN
CASE NO.:               2014AP940
COMPLETE TITLE:         Walworth State Bank,
                                  Plaintiff-Respondent-Petitioner,
                              v.
                        Abbey Springs Condominium Association, Inc. and
                        Abbey
                        Springs, Inc.,
                                  Defendants-Appellants.

                              REVIEW OF A DECISION OF THE COURT OF APPEALS
                             (Reported at 363 Wis. 2d 655, 862 N.W.2d 903)
                                      (Ct. App. 2015 – Unpublished)

OPINION FILED:          April 29, 2016
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:          November 9, 2015

SOURCE OF APPEAL:
   COURT:               Circuit
   COUNTY:              Walworth
   JUDGE:               Phillip A. Koss

JUSTICES:
   CONCURRED:
   DISSENTED:           ABRAHAMSON, J. dissents, joined by BRADLEY, A. W.,
                        J.
  NOT PARTICIPATING:


ATTORNEYS:
       For the plaintiff-respondent-petitioner, there were briefs
by Edward F. Thompson, and Clair Law Offices, S.C., Delavan, and
oral argument by Edward F. Thompson.


       For the defendants-appellants, there was a brief by David
C.   Williams,         and    Harrison,   Williams    &   McDonell,   LLP,   Lake
Geneva, and oral argument by David C. Williams.


       There was an amicus curiae brief by John E. Knight, Kirsten
E. Sprira, and Boardman & Clark LLP, Madison, on behalf of the
Wisconsin Bankers Association.
                                                                                    2016 WI 30
                                                                            NOTICE
                                                              This opinion is subject to further
                                                              editing and modification.   The final
                                                              version will appear in the bound
                                                              volume of the official reports.
No. 2014AP940
(L.C. No.   2013CV855)

STATE OF WISCONSIN                                        :              IN SUPREME COURT

Walworth State Bank,

            Plaintiff-Respondent-Petitioner,                                     FILED
      v.
                                                                            APR 29, 2016
Abbey Springs Condominium Association, Inc. and
Abbey Springs, Inc.,                                                           Diane M. Fremgen
                                                                            Clerk of Supreme Court

            Defendants-Appellants.




      REVIEW of a decision of the Court of Appeals.                              Reversed and

cause remanded.



      ¶1    REBECCA       G.     BRADLEY,      J.     We        must      decide    whether      a

condominium       policy       violates      Wisconsin            law.        Abbey      Springs

Condominium        Association,            Inc.      and          Abbey     Springs,         Inc.

(collectively,          "Abbey    Springs")         have      a    Membership       and    Guest

Policy that forbids both current and subsequent unit owners from

utilizing     recreational            facilities          until        unpaid      condominium

assessments       are    paid    in    full.         In       other    words,      the    policy

forbids     new    owners        of    a    particular             unit     from      utilizing
recreational       facilities         if   there     are       outstanding         assessments
                                                                        No.     2014AP940



attributable to the unit.                Following a foreclosure action and

sheriff's sale of the property at issue to Walworth State Bank,

the Bank paid the former owner's outstanding assessments under

protest.      Walworth         State    Bank    then     asserted    that     the   Abbey

Springs policy violates Wisconsin law because it impermissibly

revives a lien on the condominium units that was eliminated by

the foreclosure action.                As an alternative argument, Walworth

State Bank argues that the policy renders title to the units

unmarketable.        The Walworth County Circuit Court1 agreed with

Walworth State Bank and granted it summary judgment.                          The court

of appeals reversed.2            For the reasons that follow, we reverse

the court of appeals.

      ¶2     We   hold    that     Abbey       Springs's    Membership        and   Guest

Policy effectively revived the lien against the property that

the Order for Judgment on Foreclosure and Judgment (hereinafter

Foreclosure       Judgment)      entered       against     Abbey    Springs     and   the

former unit owners had extinguished.                       Although Abbey Springs

concedes that Walworth State Bank had no legal obligation to pay
the former owners' unpaid assessments following foreclosure, the

policy dictates that any unpaid assessments stay with the unit

and   transfer     to    the    new    owners    rather     than    travel     with   the




      1
          The Honorable Phillip A. Koss presiding.
      2
       Walworth State Bank v. Abbey Springs Condo. Ass'n, No.
2014AP940, unpublished slip op. (Wis. Ct. App. Mar. 26, 2015).


                                           2
                                                               No.   2014AP940



former unit's owner who actually incurred the debt.3             The policy

does so by preventing a new purchaser of any unit, whose only

connection to the unpaid assessments is through the unit itself,

from accessing the recreational facilities if the prior owner

failed to pay his or her assessments.           As a result, the policy

effectively allows Abbey Springs to assert a right against the

property for the prior owner's unpaid assessments in violation

of well-established foreclosure law.            Furthermore, the policy

violates the Foreclosure Judgment that eliminated "all right,

title, interest, lien or equity of redemption" of Abbey Springs

in and to the foreclosed units.          Because we conclude that the

condominium policy violates well-established foreclosure law and

the Foreclosure Judgment entered in the underlying foreclosure

action, we do not address Walworth State Bank's argument that

the policy renders the unit's title unmarketable.

                              I.   Background

               A.   Units 18 and 19 at Abbey Springs

    ¶3   Walworth State Bank held a first real estate mortgage
on Units 18 and 19, a single family residence on two lots, in

Abbey Springs Condominium No. 1.         Unit owners in Abbey Springs

Condominium   No.   1   pay    assessments      that   allow     access    to

recreational facilities that include a Yacht Club, restaurants,


    3
       Presumably Abbey Springs could pursue a separate action
against   the   former  unit  owners   to  recover   the  unpaid
assessments. Its Membership and Guest Policy nevertheless ties
unpaid assessments to the unit itself, regardless of a change in
unit ownership.


                                     3
                                                                   No.    2014AP940



fitness and golf facilities, and boat slips.4              These recreational

facilities are not listed as common elements of units located in

Abbey Springs Condominium No. 1.

     ¶4     Abbey Springs has a Membership and Guest Policy that

suspends both current unit owners and subsequent owners from the

recreational facilities if unpaid assessments attributed to the

unit are 90 days past due.            The policy, in pertinent part,

provides:

     If any regular monthly or special assessment against
     any Unit is delinquent for more than ninety (90) days
     past its due date, the owner or owners of that Unit,
     and any subsequent owners, shall automatically and
     without notice be suspended from any use or occupation
     of the Yacht Club, Clubhouse Grille, Pool Café,
     fitness   facilities,   golf   facilities,  and   boat
     launching facilities, until such time as assessments
     are paid in full.
     ¶5     In   addition,   Abbey    Springs      has    Bylaws   that    govern

operation of the property.           Article V, Section four, titled

Waiver of Use, provides that "no unit owner may exempt himself

from liability for his contribution towards the common expenses

or recreational facilities expenses by waiver of the use or
enjoyment   of   any   of   the   common   areas    and    facilities     or   the

recreational facilities, or by abandonment of his unit."


     4
       As we understand it, the assessments cover membership
costs and unit owners are required to pay additional costs for
the actual use and enjoyment of at least some of the
recreational facilities. For example, the Membership and Guest
Policy indicates that members are provided "a member account for
which they can charge any club-related expense" and that unit
owners are responsible for all charged amounts.


                                      4
                                                                      No.    2014AP940



                     B.    Underlying Foreclosure Action

    ¶6      In 2012, Walworth State Bank initiated a foreclosure

action against the owners of units 18 and 19, a single family

residence.       The Complaint named Abbey Springs as a defendant in

that action due to its claim of unpaid assessments attributable

to the property.           In January 2013, the Walworth County Circuit

Court entered a Foreclosure Judgment.                  It determined the total

amount owed Walworth State Bank to be $855,511.41.                     The circuit

court's    order     and    judgment      in    the   foreclosure      action    also

provided that the current owners and Abbey Springs were "forever

barred and foreclosed of all right, title, interest, lien or

equity of redemption" in and to the property.                     The circuit court

retained        jurisdiction       in     the    foreclosure        action      "until

redemption, or confirmation of sale, whichever occurs first."

Walworth State Bank later purchased the property in a sheriff's

sale.      On    April     29,    2013,   the   circuit    court     confirmed    the

sheriff's sale of the property to Walworth State Bank.

    ¶7      Prior    to     the    sheriff's     sale,    Abbey    Springs   sent   a
letter to Walworth State Bank to alert the Bank to a policy it

had adopted "to forbid use of the recreational facilities to the

owners or occupants of any unit upon which assessments or other

amounts owed to the Association are delinquent, regardless of

whether or not the Association's lien rights were eliminated by

foreclosure."       Abbey Springs suggested that Walworth State Bank

include notification of this policy in its announcements of the

sheriff's sale of the property.                  On February 5, 2013, Abbey


                                           5
                                                                         No.    2014AP940



Springs sent a follow up letter to Walworth State Bank with a

copy of the Membership and Guest policy enclosed.

       ¶8     Walworth      State    Bank       responded     to   Abbey       Springs's

letters on June 24, 2013 and asserted that the Membership and

Guest    Policy       violated    numerous       laws   and    the    order      in   the

foreclosure action.          On June 26, 2013, Abbey Springs countered

that it "does not claim, and has never claimed, that Walworth

State Bank or any grantee from Walworth State Bank is liable for

past assessments due the Association."

       ¶9     Walworth State Bank arranged for the property to be

sold to new buyers with a closing scheduled for July 12, 2013.

However, on July 12, 2013, Abbey Springs's Executive Director

issued a letter stating that the outstanding assessments would

be satisfied if "the seller pays Abbey Springs $13,225.32."                            As

a result, the new buyers refused to close on the property as

scheduled.       On the same day, July 12, 2013, Walworth State Bank

sent    Abbey    Springs     another     letter      accusing      the      condominium

association of "thwarting" the sale and requiring Walworth State
Bank    to     pay    the   outstanding         assessments.          Abbey      Springs

reasserted its position——the Bank was not required to pay the

prior       owner's    outstanding     assessments——in         a     July      16,    2013

letter.       Ultimately and under protest, Walworth State Bank paid

the prior owners' unpaid assessments in the amount of $13,225.32

to complete the sale of the property to the new owners.

                             C.     Procedural History

       ¶10    Walworth State Bank filed suit against Abbey Springs
and asked the circuit court to declare Abbey Springs's policy in
                                            6
                                                                                No.    2014AP940



violation of Wisconsin law and to order judgment in the amount

of $13,225.32 for the assessments it paid under protest.                                     The

circuit      court      granted      Walworth      State    Bank's    summary          judgment

motion after considering cross-motions for summary judgment.                                  It

determined that Abbey Springs's policy violated Wisconsin law by

holding new owners jointly and severally liable for the prior

owners'       unpaid       assessments          in     violation      of        Wis.        Stat.

§ 703.165(2)           (2013-14)5      and    by     affecting       the        quality      and

marketability of the property's title in violation of Wis. Stat.

§ 703.10(6).           It also granted Walworth State Bank a monetary

judgment against Abbey Springs in the amount of $13,225.32.

       ¶11      The court of appeals reversed.                Walworth State Bank v.

Abbey Springs Condo. Ass'n, No. 2014AP940, unpublished slip op.

(Wis. Ct. App. Mar. 26, 2015).                     It held that the policy was not

contrary to any Wisconsin statute and that Walworth State Bank

had "no obligation to pay the delinquent assessments."                                       Id.,

¶18.       Specifically, it held that Wis. Stat. § 703.165(5)(b),

which establishes lien priority for unpaid assessments, did not
govern the issue of liability for the unpaid assessments.                                    Id.,

¶16.       It    further     held      that     Wis.    Stat.      § 703.165(2),            which

governs liability for assessments, does not govern liability for

unpaid       assessments        in    an     involuntary        grant,      such       as    the

sheriff's       sale     that   occurred        here.       Id.,     ¶18.         It   further

reasoned        that     "[t]he      policy        merely   created         a    pay-to-play

       5
       All references to the Wisconsin Statutes are to the 2013-
14 version unless otherwise indicated.


                                               7
                                                                     No.    2014AP940



requirement, and did not attempt to create joint and several

liability in any respect."6         Id.

                                 II.    Analysis

     ¶12    Appellate     courts       independently      review      orders     for

summary judgment utilizing the "same methodology as the circuit

court."    Yahnke v. Carson, 2000 WI 74, ¶10, 236 Wis. 2d 257, 613

N.W.2d     102.      "Summary    judgment        is    appropriate     when     '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.'"

Id. (quoting Wis. Stat. § 802.08(2) (1995-96)).

            A.    Inapplicability of Wis. Stat. § 703.165(2)

     ¶13    Walworth     State     Bank       argues   that   Abbey        Springs's

Membership and Guest Policy violates Wis. Stat. § 703.165(2) by

holding subsequent owners who obtain property in an involuntary

sale jointly and severally liable for the unpaid assessments of




     6
       The court of appeals also held that Abbey Springs's policy
did not render the units' title unmarketable because Walworth
State Bank failed to produce any evidence that the policy
prevented it from conveying title. Walworth State Bank v. Abbey
Springs Condo. Ass'n, No. 2014AP940, unpublished slip op., ¶20
(Wis. Ct. App. Mar. 26, 2015).


                                          8
                                                    No.   2014AP940



past owners.   It also asserts that the policy renders title to

the units unmarketable in violation of Wis. Stat. § 703.10(6).7

     ¶14   Whether the Membership and Guest Policy is valid in

light of the Foreclosure Judgment that eliminated "all right,

title, interest, lien or equity of redemption" of Abbey Springs

in and to the property, presents an issue of first impression

that is not directly controlled by Wisconsin case law or the

Wisconsin Statutes.    Although Walworth State Bank argues that

Wis. Stat. § 703.165(2) governs and that the policy is invalid

under this statute, we do not agree.

     ¶15   Wisconsin Stat. § 703.165 is titled: "Lien for unpaid

common expenses, unpaid damages, and unpaid penalties."   Section

703.165(2) pertains to "liability for assessments" and states,

in full:

     A unit owner shall be liable for all assessments, or
     installments thereof, coming due while owning a unit,
     including any assessments coming due during the
     pendency of any claim by the unit owner against the
     association or during any period in which the unit is
     not occupied by the unit owner or is leased or rented
     to any other person.      In a voluntary grant, the
     grantee shall be jointly and severally liable with the
     grantor for all unpaid assessments against the grantor
     for his or her share of the common expenses up to the
     time of the voluntary grant for which a statement of
     condominium lien is recorded, without prejudice to the

     7
       Because we conclude that Abbey Springs's Membership and
Guest Policy violates well-established foreclosure law, we do
not address Walworth State Bank's alternative argument that the
policy renders title to the units unmarketable under Wis. Stat.
§ 703.10(6). "Typically, an appellate court should decide cases
on the narrowest possible grounds."    Maryland Arms Ltd. P'ship
v. Connell, 2010 WI 64, ¶48, 326 Wis. 2d 300, 786 N.W.2d 15.


                                9
                                                                        No.    2014AP940


      rights of the grantee to recover from the grantor the
      amounts paid by the grantee for such assessments.
      Liability for assessments may not be avoided by waiver
      of the use or enjoyment of any common element or by
      abandonment of the unit for which the assessments are
      made.
Wis. Stat. § 703.165(2)(emphasis added).                The statutory language

emphasized above indicates that in a                   voluntary grant, a new

owner     is    held   jointly    and      severally          liable     for    unpaid

assessments owed by the prior owner.                 Walworth State Bank relies

on this language to argue that the inverse must be true in an
involuntary      grant,   such   as   a    sheriff's     sale.         Specifically,

Walworth State Bank's position is that in an involuntary grant,

a new owner cannot be held jointly and severally liable for the

outstanding assessments of the prior owner.                     However, we agree

with the court of appeals that the language                       in    § 703.165(2)

pertaining to voluntary grants of property has no bearing on the

involuntary grant at issue here.               The liability of a new owner

for     the    outstanding   debt     of       the    prior     owner     under     the

circumstances of an involuntary grant is not directly addressed

in Chapter 703 and it is not this court's place to speak where

the legislature was silent.8




      8
       "The principle that a matter not covered is not covered is
so obvious that it seems absurd to recite it." Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts
93 (2012). "Courts must take statutes as they find them . . . .
They are not the law-making body. They are not responsible for
omissions   in   legislation."      Id.  (citing   R.W.M.   Dias,
Jurisprudence 232 (4th ed. 1976)).


                                          10
                                                                         No.   2014AP940



                         B.     The Law of Foreclosure

       ¶16    Instead,     we      turn    to    pertinent    statutory    provisions

governing condominiums, the Foreclosure Judgment entered against

Abbey Springs in the underlying foreclosure action, and well-

established foreclosure law to render a decision.                         Chapter 703

of the Wisconsin Statutes, known as the Condominium Ownership

Act, governs condominiums.                It explains that unpaid condominium

assessments "constitute a lien on the units on which they are

assessed" as long as certain statutory requirements are met.

Wis. Stat. § 703.165(3).                  Assessments are defined as "regular

and special assessments for common expenses and charges, fines,

or assessments against specific units or unit owners for damages

to   the     condominium      or    for     penalties   for     violations       of   the

declaration,      bylaws,          or     association    rules."          Wis.    Stat.

§ 703.165(1).

       ¶17    Wisconsin Stat. § 703.165(5) also governs the priority

given to a lien for unpaid assessments.                         Applicable here is

§ 703.165(5)(b), which provides that "a first mortgage recorded
prior to the making of the assessment" has priority over a lien

for unpaid condominium assessments.

       ¶18    Here, it is undisputed that the former owners of Units

18 and 19 had unpaid condominium association assessments.                              As

Wis.   Stat.     § 703.165(3)           indicates,    these     unpaid    assessments

constituted a lien against the units.                        It is also undisputed

that Abbey Springs filed a claim for surplus in the foreclosure

action "based on a 'Statement of Condominium Lien'" it filed
against the former owners.                 Furthermore, the parties agree that
                                                11
                                                                            No.    2014AP940



Walworth    State     Bank's      interest,      as   the     holder        of     a   first

mortgage on the units, takes priority over Abbey Springs's lien

based on unpaid assessments.              This position is supported by the

plain    language    of   Wis.     Stat.    § 703.165(5)(b),           which       gives    a

first     mortgage    holder       priority      over     any     lien       for       unpaid

assessments that was recorded after the first mortgage.

    ¶19     Prioritization of Walworth State Bank's first mortgage

over Abbey Springs's lien for unpaid assessments is reflected in

the Foreclosure Judgment entered by the circuit court in the

foreclosure action.          In that action, the circuit court entered

default    judgment      against    the    unit    owners       and   Abbey        Springs.

Specifically,      the    circuit    court      ordered     that      the    defendants,

including Abbey Springs, "after the filing of the Lis Pendens

herein, be forever barred and foreclosed of all right, title,

interest, lien or equity of redemption in and to said mortgaged

premises . . . ."            Abbey Springs did not appeal the circuit

court's Foreclosure Judgment.

    ¶20     The circuit court's order in the foreclosure action
that eliminated "all right, title, interest, lien or equity of

redemption in and to" the property aligns with Chapter 846 of

the Wisconsin Statutes and the equitable purpose of foreclosure.

In Wisconsin, and across much of the United States, judicial

foreclosure is the available method of foreclosure.                           1 Grant S.

Nelson et al., Real Estate Finance Law § 7:12, at 903 (6th ed.

2014).      Generally        speaking,     Chapter      846      of    the        Wisconsin

Statutes    sets     forth    a    two-step       procedure      that       governs       the
foreclosure process.         Shuput v. Lauer, 109 Wis. 2d 164, 171, 325
                                           12
                                                                  No.   2014AP940



N.W.2d 321 (1982).          The first step includes the judgment of

foreclosure and sale.        Id.    It is during this first step that a

circuit      court   determines    "the   parties'    legal   rights     in   the

underlying mortgage and obligation, including the right to a

deficiency judgment."         Bank Mut. v. S.J. Boyer Const., Inc.,

2010 WI 74, ¶27, 326 Wis. 2d 521, 785 N.W.2d 462.                 Specifically,

Wis. Stat. § 846.01 addresses the first step in the foreclosure

process, the foreclosure judgment.           Section 846.01(1) provides,

in pertinent part:

       [I]n actions for the foreclosure of mortgages upon
       real estate, if the plaintiff recover, the court shall
       render judgment of foreclosure and sale, as provided
       in this chapter, of the mortgaged premises or so much
       of the premises as may be sufficient to pay the amount
       adjudged to be due upon the mortgage and obligation
       secured by the mortgage, with costs.
Id.    This court has determined that § 846.01(1) "requires the

court to render judgment of foreclosure and sale in successful

foreclosure actions."       Bank Mut., 326 Wis. 2d 521, ¶28.

       ¶21    The second step in foreclosure actions "carries into

effect and enforces the judgment of foreclosure and sale."                    Id.,

¶27.     That is, after the judgment of foreclosure is entered and

sale of the property completed, additional statutory proceedings

take place to confirm the sale, determine the rights to surplus,

if any, and enter deficiency judgment, if applicable.                   See Wis.

Stats.       §§ 846.162,   846.165,   846.167;       see   also   Shuput,      109

Wis. 2d at 171.

       ¶22    In carrying out this two-step process, a circuit court
ensures that the basic objectives of a foreclosure action are


                                      13
                                                                       No.        2014AP940



met.     Secondary sources and Wisconsin case law have explained

the objective and function of foreclosure actions in various

ways:

       The basic objective of an action to foreclose is to
       enable the mortgage creditor to get his debt paid out
       of the security. To accomplish this end[,] it is the
       purpose of the foreclosure sale to end the right to
       redeem of all persons who have interests in the
       property subject to the mortgage and to vest in the
       purchaser on the sale the title to the property as it
       stood at the time of the execution of the mortgage.
George E. Osborne, Handbook on the Law of Mortgages § 319, at

669 (2d ed. 1970).            This court has explained that "the judgment

of foreclosure and sale determines the rights of the parties and

disposes of the entire matter in litigation . . . ."                              Shuput,

109 Wis. 2d at 172.             Furthermore, the Restatement (Third) of

Property addresses the effect of foreclosure actions on lien

priorities:         "A valid foreclosure of a mortgage terminates all

interests in the foreclosed real estate that are junior to the

mortgage being foreclosed and whose holders are properly joined

or    notified      under   applicable    law."          Restatement     (Third)        of

Property (Mortgages) § 7.1 (1997) (emphasis added).                          In regard

to the first priority mortgage, this court has explained that,

generally,     "a    proper     foreclosure   proceeding,        when     confirmed,

satisfies     the      debt     [if   there   are        sufficient      funds]        and

extinguishes the mortgage."           Winter v. Knaak, 236 Wis. 367, 370,

294    N.W.   488    (1940).      With   regard     to    the   rights       of    junior

lienholders such as Abbey Springs, the court of appeals has
stated:


                                         14
                                                                                  No.   2014AP940


       [W]hen property is sold at a foreclosure sale, the
       property is transferred to the purchaser who receives
       the interest of the mortgagor and whatever interest
       the other parties to the suit possessed at the
       commencement of the action. As a result, those who
       were parties to the action can no longer assert any
       claim or right of interest against the property. The
       interest of such parties is deemed "foreclosed,"
       leaving them to look only to sale proceeds for
       satisfaction of their claim.
First Wis. Trust Co. v. Rosen, 143 Wis. 2d 468, 472-73, 422

N.W.2d       128    (Ct.     App.    1988)     (citations         omitted).             In    sum,

secondary          sources    and    Wisconsin        case       law     demonstrate          that

foreclosure          actions       are   designed          to:     (1)       bring      together

creditors' claims to a property for disposition in a single

proceeding;         (2)    apply    proceeds        from    the    foreclosure          sale    to

satisfy the liens of those parties to the foreclosure action in

order       of     priority;       and   (3)    extinguish          unsatisfied          junior

lienholders' rights9 to the property so that title transfers

unencumbered to the new purchaser.

       ¶23       Abbey    Springs    attempts        to    evade       the   effect      of    the

Foreclosure Judgment in this case by acknowledging that its lien

was extinguished in the foreclosure action but claiming that the

underlying         debt——the       unpaid    assessments——survives                due    to    its

connection to Units 18 and 19.                  Indeed the underlying debt does

survive and nothing in the Foreclosure Judgment prevents Abbey

Springs from suing the former unit owners to recover that debt.

What       Abbey    Springs    is    foreclosed           from    doing      is    perpetually


       9
       Junior lienholders' rights are so extinguished when the
junior lienholders are made parties to the foreclosure action.


                                               15
                                                                           No.    2014AP940



saddling the property and all subsequent owners with debt owed

by the former unit owners unless and until that debt is paid.

Not only did the Foreclosure Judgment extinguish the "lien" it

also    "forever      barred       and     foreclosed"      all    "right"       and   all

"interest" of Abbey Springs in and to the property.                         The circuit

court possessed both statutory and equitable power to effectuate

this comprehensive foreclosure of rights and interests.

       ¶24   In carrying out the two-step foreclosure procedure,

circuit      courts    are     not       limited    to    the     powers    and     duties

expressly provided in Chapter 846.                  "Foreclosure proceedings are

equitable in nature, and the circuit court has the equitable

authority to exercise discretion throughout the proceedings."

GMAC Mortg. Corp. v. Gisvold, 215 Wis. 2d 459, 480, 572 N.W.2d

466    (1998).        In   other     words,       the    foreclosure       judgment,    in

accordance with Wis. Stat. § 846.01 as well as the equitable

authority of the circuit court, determines the rights of the

parties with interests in the foreclosed property.

       ¶25   The   purpose      of       foreclosure      law     and   the      statutory
scheme governing foreclosure in Wisconsin guide our decision.

As discussed, the purpose of foreclosure is to allow a mortgagee

to collect what it is owed through, generally speaking, the sale

of the mortgaged property.                 See Osborne, supra § 319, at 669.

To achieve this purpose, a foreclosure action determines the

rights of the parties to the subject property and restores "the

title to the property as it stood at the time of the execution

of the mortgage."            Id.     Here, but for Walworth State Bank's
payment of the former owners' unpaid assessments, title would
                                             16
                                                                                   No.      2014AP940



not have been so restored because the former owners' debt, which

Abbey      Springs      claims       survives     the      foreclosure           action,          would

continue to affect the current owners' ability to utilize the

recreational facilities.                Moreover, Chicago Title Company issued

a commitment for title insurance to the then-prospective owners

containing         an     exception           from     coverage            for        the     unpaid

assessments.

      ¶26     In     accordance         with     Wis.       Stat.      § 846.01             and     its

equitable powers, the circuit court eliminated all rights of

Abbey   Springs         and    the    former     owners         to   the    property          in    the

foreclosure        action.           However,    Abbey       Springs's           Membership         and

Guest      Policy       contravenes      the     circuit         court's         order        in    the

foreclosure action by reviving an interest in the units that the

circuit court eliminated.                  The policy does so because unpaid

assessments attributable to the units remain attributable to the

units even after foreclosure.                        This is contrary to both the

judgment of foreclosure, which eliminated not only the lien but

all   of    Abbey       Springs's       rights       and    interests        in       and     to    the
property in question, and well-established foreclosure law.                                          As

a   result,     the      condominium          policy       as    applied         in    this        case

violates both the purpose of foreclosure and the circuit court's

Foreclosure Judgment.

      ¶27     The       fact    that     Walworth          State     Bank        had     no       legal

obligation     to       pay    the    former     owners'         outstanding           assessments

after foreclosure does not change our decision.                                  The connection

Walworth      State      Bank    had     to     the    outstanding          assessments             was
through its ownership of the property after purchase at the
                                                17
                                                                          No.    2014AP940



sheriff's sale.          Abbey Springs's policy improperly tethers the

unpaid assessments to the unit itself by prohibiting subsequent

owners from utilizing the recreational facilities.                          This is an

assertion of a right against the property itself regardless of

whether or not Abbey Springs would have been able to legally

collect the unpaid assessments from Walworth State Bank or a

later owner.          We agree with the dissent that "a lien cannot

exist independent of a debt."              Dissent, ¶56.           However, here, as

we    have     explained,      Abbey    Springs's        policy    ties    the     unpaid

assessment debt——owed by the former owners of the units——to the

units    themselves,      thereby      impermissibly           reviving   an     interest

extinguished by the foreclosure action.                    The dissent disregards

the     fact    that     not    only    were      liens        extinguished       by   the

Foreclosure Judgment but also "all right, title, interest, lien

or equity of redemption" were also eliminated.

       ¶28     Additionally,      contrary        to     the    court     of     appeals'

suggestion       otherwise,       Abbey         Springs's        policy    cannot       be

characterized as a pay-to-play policy because it requires the
new   owners     to    continue    to     pay    monthly       assessments       for   the

recreational facilities regardless of whether or not they use

the facilities or are prohibited from using them.                               Under the

Bylaws, new owners must continue to pay monthly assessments for

the recreational facilities even if the Membership and Guest

Policy       prohibits    them     from    setting        foot     in     any     of   the

recreational       facilities       due    to      the     prior     owners'       unpaid

assessments.       If the Membership and Guest Policy prohibited only
current owners from utilizing recreational facilities when those
                                           18
                                                                      No.    2014AP940



current owners failed to pay assessments, we might be able to

characterize the policy as a pay-to-play policy.                      However, the

Bylaws require owners to pay assessments for the recreational

facilities while, at the same time, the Membership and Guest

Policy prohibits owners from using the recreational facilities

based on the unpaid assessments of prior owners.                     This is not a

pay-to-play policy.

       ¶29    We recognize that condominium owners are often subject

to a variety of enforceable use restrictions imposed under the

declaration and bylaws pertaining to their units.                       See, e.g.,

Wis. Stats. §§ 703.09(1)(g), 703.10(3).                      However, we disagree

with   the    dissent's     assertion      that      under   our   holding   no   use

restriction imposed by a condominium or homeowners association

could survive a foreclosure action.                  See dissent, ¶¶67-69.        Our

holding does not extend to enforceable use restrictions and is

far more narrow than the dissent suggests.                         Abbey Springs's

Membership and Guest Policy cannot survive a foreclosure action

to the extent it restricts a current owner's use of certain
recreational facilities based on the failure of the prior owners

to pay their debts.          Such a policy ties the debts of the prior

owners       to     the   units,      in    violation        of    well-established

foreclosure law as reflected in the Foreclosure Judgment.                      A use

restriction        that   prohibits    dogs     on   condominium     property,    for

example, would not depend on a prior owner's actions and would

not result in a foreclosed debt forever haunting a particular

unit instead of following the prior owners to whom the debt
belongs.          The same could be said about the use restriction on
                                           19
                                                             No.     2014AP940



renting upheld by Apple Valley Gardens Ass'n, Inc. v. MacHutta,

2009 WI 28, ¶3, 316 Wis. 2d 85, 763 N.W.2d 126.10                The dissent

disregards the obvious fact that enforceable use restrictions

generally apply to all property owners equally and not just to

those who have the misfortune of purchasing units from prior

owners who left unpaid debts behind.

                              III.   Conclusion

    ¶30    We   hold   that    Abbey    Springs's   Membership     and    Guest

Policy    violates     well-established      foreclosure   law      and     the

Foreclosure Judgment entered against Abbey Springs.              It does so

by tethering unpaid condominium assessments to the units, which

effectively results in Abbey Springs asserting a right against

the property that the Foreclosure Judgment eliminated.                    Under

the undisputed facts, Walworth State Bank is entitled to summary

judgment as a matter of law.           Accordingly, we reverse the court




    10
        Comparing the policy at issue in this case with the
rental restriction at issue in Apple Valley Gardens Ass'n, Inc.
v. MacHutta, 2009 WI 28, 316 Wis. 2d 85, 763 N.W.2d 126, is not
helpful considering that Apple Valley did not involve a
foreclosed property or even a sale of a property. Id., ¶9. In
Apple Valley we rejected the argument that a restriction on
renting must appear in a condominium's declaration, rather than
its bylaws, in order to be valid.    Id., ¶¶1, 3.   We also held
that the specific condominium declaration at issue did not
create a right to rent and that a restriction on renting did not
render title unmarketable under Wis. Stat. § 703.10(6).     Id.,
¶3.   Our holding that the rental restriction at issue in Apple
Valley was valid has no bearing on the application of the
Membership and Guest Policy in the context of the foreclosed
units.


                                       20
                                                               No.   2014AP940



of appeals and remand to the circuit court to enter an order

consistent with our opinion.

    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.




                                  21
                                                                              No.    2014AP940.ssa




       ¶31        SHIRLEY    S.    ABRAHAMSON,        J.        (dissenting).            I    agree

with the result reached by the court of appeals.                                    The majority

opinion       asserts       that    Abbey    Springs'           policy     violates          "well-

established         foreclosure        law."1        Asserting         that     something        is

"well-established"              does   not      mean       it    is,     in     fact,        "well-

established."               The    majority         opinion       fails       to     prove     its

assertion.

       ¶32        Let's look at the facts.             Abbey Springs, a condominium

association, adopted a policy barring an owner of a condominium

unit       from    using    certain     recreational            facilities          if   "regular

monthly or special assessment[s]" are more than 90 days past

due, unless the unpaid assessments (including a prior owners'

unpaid assessments) are paid.

       ¶33        Abbey Springs' policy provides in relevant part:

       If any regular monthly or special assessment against
       any Unit is delinquent for more than ninety (90) days
       past its due date, the owner or owners of that Unit,
       and any subsequent owners, shall automatically and
       without notice be suspended from any use or occupation
       of the Yacht Club, Clubhouse Grille, Pool Café,
       fitness   facilities,   golf   facilities,  and   boat
       launching facilities, until such time as assessments
       are paid in full.
Majority op., ¶4.

       ¶34        In the instant case, the previous owners of the two

condominium         units    at    issue     were      delinquent         in    paying        their

mortgage          and   their     assessments.             Walworth       State       Bank,    the

mortgagee, brought a foreclosure action naming the unit owners
       1
           See majority op., ¶¶2, 13 n.7, 16, 26, 29, 30.


                                                1
                                                             No.   2014AP940.ssa


and Abbey Springs as defendants.           Abbey Springs was named as a

defendant    because   Abbey    Springs      had     a   lien      for     unpaid

assessments secured against the units pursuant to Wis. Stat.

§ 703.165(3).2

     ¶35    The   circuit    court       entered     a   judgment        in   the

foreclosure action providing that the owners of the foreclosed

units and Abbey Springs and all persons claiming under them were

"forever barred and foreclosed of all right, title, interest,

lien or equity of redemption" in and to the units.                       Walworth

State Bank bought the units at issue in a sheriff's sale.

     ¶36    The   question   presented      is     whether   Abbey       Springs'

policy barring an owner of a condominium unit from using certain


     2
         Wisconsin Stat. § 703.165(3) states:

     All assessments, until paid, together with interest on
     them and actual costs of collection, constitute a lien
     on the units on which they are assessed, if a
     statement of lien is filed within 2 years after the
     date the assessment becomes due.         The lien is
     effective against a unit at the time the assessment
     became due regardless of when within the 2-year period
     it is filed. A statement of condominium lien is filed
     in the land records of the clerk of circuit court of
     the county where the unit is located, stating the
     description of the unit, the name of the record owner,
     the amount due and the period for which the assessment
     was due.   The clerk of circuit court shall index the
     statement of condominium lien under the name of the
     record owner in the judgment and lien docket.      The
     statement of condominium lien shall be signed and
     verified by an officer or agent of the association as
     specified in the bylaws and then may be filed.      On
     full payment of the assessment for which the lien is
     claimed, the unit owner shall be entitled to a
     satisfaction of the lien that may be filed with the
     clerk of circuit court.


                                     2
                                                                      No.    2014AP940.ssa


recreational         facilities       if      "regular       monthly        or    special

assessment[s]" are more than 90 days past due, unless the unpaid

assessments (including a prior owners' delinquent assessments)

are     paid,    may     be   enforced     against       the    purchaser         of    the

condominium units following a foreclosure sale.                             For ease of

discussion, I will refer to this policy restricting access to

the recreational facilities as "Abbey Springs' recreational use

policy."

      ¶37      The   majority       opinion      asserts     that   Abbey        Springs'

recreational use policy violates Wisconsin law in two respects:

          1. Abbey Springs' recreational use policy "impermissibly

               revives    a   lien    on   the    condominium       units        that   was

               eliminated by the foreclosure action."                       See majority

               op., ¶1.

          2. Abbey Springs' recreational use policy violates the

               circuit    court's     order      for   judgment     on      foreclosure.

               The judgment eliminated "all right, title, interest,

               lien or equity of redemption" of Abbey Springs in and
               to the foreclosed units.           See majority op., ¶¶2, 30.

      ¶38      Everyone agrees that the statutory lien against the

units     for    the     unpaid     assessments        was   extinguished         in    the

foreclosure action.3           Everyone agrees that a purchaser of the

units     at    issue    is   not    personally        liable   for      prior     unpaid

assessments.4


      3
          See majority op., ¶¶16-29.
      4
          See majority op., ¶¶2, 27


                                           3
                                                                        No.    2014AP940.ssa


      ¶39    Although the statutory lien is gone and the new owners

of    the   units     are   not     personally       liable       for     prior     unpaid

assessments, the majority opinion states (in conclusory fashion

and    without       citation      to     authority)        that    Abbey         Springs'

recreational use policy "impermissibly revives a lien on the

condominium      units      that    was     eliminated       by     the        foreclosure

action,"5 "improperly tethers the unpaid assessments to the unit

itself,"6 and asserts "a right against the property."7

      ¶40    I disagree with the majority opinion.                      This "revived,"

"tethered," resurrected lien "haunting a particular unit" is a

figment of the majority opinion's imagination not traceable to

any statute or common law principle.                       The statutory lien is

gone; no lien exists to haunt, or to be revived, tethered, or

resurrected.

      ¶41    Nevertheless,         the    majority        opinion       concludes       that

Abbey Springs' recreational use policy amounts to Abbey Springs'

claiming a "right, title, interest, lien or equity of redemption

in and to" the foreclosed units that was barred by the judgment
of foreclosure.          The majority opinion does not explain what

"right, title, interest, lien or equity of redemption in and to"

the foreclosed units Abbey Springs is claiming.                               The majority

opinion     cannot    explain      itself       because    Abbey    Springs        is   not



      5
          Majority op., ¶1.
      6
          Majority op., ¶27.
      7
          Majority op., ¶¶27, 30.


                                            4
                                                                     No.   2014AP940.ssa


claiming a "right, title, interest, lien or equity of redemption

in and to" the foreclosed units.

     ¶42      With   respect    to   the   judgment        of    foreclosure,       Abbey

Springs does not claim a lien on the foreclosed units.                              Abbey

Springs' recreational use policy does not in any way revive the

extinguished lien.

     ¶43      Abbey Springs does not claim an equity of redemption

in and to the foreclosed units.

     ¶44      Abbey Springs is not using its recreational use policy

to claim a right, title, or interest in and to the foreclosed

units.     Abbey Springs is, as several briefs point out, using

access   to    the   recreational     facilities,          which    are    not   common

elements of the condominium at issue, as "leverage to compel

satisfaction of all [assessments in] arrears."8

     ¶45      Restrictions      on   the       use    of   the     unit    itself    are

permissible under Wisconsin law.9                    If use of the unit may be

restricted, surely a restriction on the use of the association's

recreational facilities is permissible, even if used as leverage
to compel the payment of delinquent assessments.

     ¶46      In   Part   II,   below,     I    conclude    that     Abbey    Springs'

recreational use policy does not affect the marketable title to

the units.

     8
       See Highland Lakes Country Club & Cmty. Ass'n v. Franzino,
892 A.2d 646, 655 (N.J. 2006) (allowing the use of such leverage
in a similar situation).
     9
       See Apple Valley Gardens Ass'n, Inc. v. MacHutta, 2009 WI
28, ¶18, 316 Wis. 2d 85, 763 N.W.2d 126; accord Wis. Stat.
§ 703.10(1), (3).


                                           5
                                                                 No.   2014AP940.ssa


    ¶47   In       sum,   the     majority     opinion        contravenes      basic

principles     of    real       property     law,    foreclosure        law,     and

condominium law.

    ¶48   For the reasons set forth, I would affirm the court of

appeals and hold that Abbey Springs' recreational use policy is

enforceable.

                                       I

    ¶49   Condominium associations' expenses are funded largely

through "assessments," which an association may levy among unit

owners.   See Wis. Stat. § 703.16(2)(a).

    ¶50      The     significant      problem       posed      for     condominium

associations by unpaid assessments is the issue underlying the

instant case.

    ¶51   The       problem,     simply      stated,     is     that    unless     a

condominium association can recover delinquent assessments from

the delinquent unit owner (or, under a policy such as Abbey

Springs has adopted, from a subsequent owner), the cost of the

delinquent assessments will be passed on to the owners of other
condominium units.        As a Report of the Joint Editorial Board for

Uniform Real Property Acts explained:

    If some owners do not pay their proportionate share of
    common expenses, the association will be forced to
    shift the burden of delinquent assessments to the
    remaining unit owners through increased assessments or




                                       6
                                                                      No.   2014AP940.ssa

      reduced   services    and   maintenance,    potentially
      threatening property values within the community.10
      ¶52    To enable a condominium association to collect unpaid

assessments, Wis. Stat. § 703.165(3) creates a lien on a unit

for   certain      unpaid   assessments.11          This       statutory        lien   was

extinguished in the foreclosure action.12                      Everybody agrees the

statutory lien is extinguished.              No ifs, ands, or buts.

      ¶53    To further address the problem of unpaid assessments

and   the     limitations       of     the     statutory         lien       for   unpaid

assessments, Abbey Springs adopted its recreational use policy,

restricting access to Abbey Springs' recreational facilities as

leverage     to    compel   a   unit     owner      to    pay     a     prior     owner's

delinquent      assessments.         Everyone,      including         Walworth      State

Bank, was notified of Abbey Springs' recreational use policy.

      ¶54    The     parties     agree,       and        the     majority         opinion

acknowledges, that under Abbey Springs' recreational use policy,


      10
       The Six-Month 'Limited Priority Lien' for Association
Fees Under the Uniform Common Interest Ownership Act, at 1 (June
1,               2013),                available               at
http://www.uniformlaws.org/shared/docs/jeburpa/2013jun1_JEBURPA_
UCIOA%20Lien%20Priority%20Report.pdf;    see     also   Wisconsin
Condominium Law Handbook, § 5.36 (4th ed. 2013).
      11
       Wisconsin Stat. § 703.165 provides, among other things,
that owners are liable for all assessments "coming due while
owning a unit" and that "[a]ll assessments, until paid, together
with interest on them and actual costs of collection, constitute
a lien on the units on which they are assessed, if a statement
of lien is filed within 2 years after the date the assessment
becomes due."    Wis. Stat. § 703.165(2), (3) (emphasis added).
This lien is inferior to a first mortgage.       See Wis. Stat.
§ 703.165(5)(b).
      12
           See majority op., ¶23.


                                          7
                                                                No.   2014AP940.ssa


an owner of a unit "ha[s] no legal obligation to pay the former

owners' outstanding assessments after foreclosure . . . ."13                     In

other words, Walworth State Bank (and any person purchasing the

units from the Bank) is not liable for the prior owner's unpaid

assessments.14        Refusing    to   pay   the    prior   owner's   delinquent

assessments results only in the new owner's exclusion from Abbey

Springs' recreational facilities.

       ¶55    Nevertheless,      the   majority      opinion   concludes       that

Abbey Springs' recreational use policy "impermissibly revives a

lien    on    the   condominium    units     that    was    eliminated    by   the

foreclosure action."15

       ¶56    No lien was revived under Abbey Springs' recreational

use policy.         The "well-established law" is that a lien cannot

exist independent of a debt.16                A lien secures payments for


       13
            Majority op., ¶27.
       14
       See Walworth State Bank v. Abbey Springs Condo. Ass'n,
Inc., No. 2014AP940, unpublished slip op., ¶18 (Wis. Ct. App.
Mar. 26, 2015) ("Nothing in Abbey Springs' policy gave Abbey
Springs the right to pursue recovery of the unpaid assessments
from [the Bank].").
       15
            Majority op., ¶1.
       16
       Dorr v. Sacred Heart Hosp., 228 Wis. 2d 425, 437, 597
N.W.2d 462 (Ct. App. 1999) (defining a lien as "a 'Qualified
right of property which a creditor has in or over specific
property of his debtor . . . .'    Because a lien is a right to
encumber property until a debt is paid, it presupposes the
existence of a debt.") (quoting Black's Law Dictionary 832 (5th
ed. 1979)) (emphasis in original).

       This court has endorsed Dorr's analysis of a lien, stating:

       Dorr's analysis began with the proposition that a lien
       "presupposes the existence of a debt." 228 Wis. 2d at
                                                       (continued)
                                  8
                                                                   No.    2014AP940.ssa


debts due the lienholder and facilitates the satisfaction of

that obligation.

     ¶57    The      majority    opinion      acknowledges           this       "well-

established" law, but does not recognize its importance in the

instant case.17

     ¶58    In the instant case, Walworth State Bank and the new

owners of the foreclosed units are not indebted to Abbey Springs

for the past owners' unpaid assessments.              The new owners are not

personally     liable      to   Abbey     Springs     for    any         past   unpaid

assessments.        The prior owners of the units remain indebted to

Abbey     Springs    for    unpaid      assessments    they        incurred      while

owners.18    Stated simply, the foreclosure action severed the debt

of the prior owners for unpaid assessments from the collateral;

the debt remained that of the prior owners and the collateral

was gone.

     ¶59    The majority opinion invents a "straw lien" and then

blows it down, concluding that Abbey Springs' recreational use


     437, 587 N.W.2d 462.   That proposition is deeply
     rooted in our jurisprudence, see Boorman v. Wis.
     Rotary Engine Co., 36 Wis. 207, 212-13 (1874), and
     widely accepted.   See 51 Am. Jur. 2d Liens § 13
     (2011).

Gister v. Am. Family Mut.            Ins.    Co.,     2012    WI    86,     ¶51,   342
Wis. 2d 496, 818 N.W.2d 880.
     17
          Majority op., ¶27.
     18
       See majority op., ¶23; see also Badger III Ltd. P'ship v.
Howard, Needles, Tammen & Bergendoff, 196 Wis. 2d 891, 898-99,
539 N.W.2d 904 (Ct. App. 1995) (recognizing that a debt
unsatisfied in a foreclosure action and sheriff's sale survives
the foreclosure).


                                         9
                                                                     No.    2014AP940.ssa


policy     violates         "well-established      foreclosure        law."19          The

majority      opinion        does    not    explain    what     "well-established

foreclosure         law"     Abbey     Springs'     recreational           use      policy

violates.

    ¶60       I turn now to the second rationale of the majority

opinion:       Abbey Springs' recreational use policy violates the

circuit court's order for judgment on foreclosure.                         The judgment

eliminated        "all     right,    title,     interest,     lien    or     equity    of

redemption" of Abbey Springs in and to the foreclosed units.

See majority op., ¶¶2, 30.

    ¶61       I    agree     with    the   majority    opinion       that     the    five

elements of the foreclosure judgment——right, title, interest,

lien, and equity of redemption——should be analyzed.20                            I have

already explained that Abbey Springs does not claim, and is not

entitled to claim, a lien in and to the foreclosed units.                             Nor

does Abbey Springs claim an equity of redemption in and to the

foreclosed units.            So what right, title, or interest does Abbey

Springs claim in and to the foreclosed units?
    ¶62       The answer is that Abbey Springs does not claim any

right, title, or interest in and to the foreclosed units.                           Abbey

Springs'      recreational       use   policy     restricts     the    unit      owners'

access   to       certain    recreational       facilities,    as     several       briefs

claim, as leverage to compel satisfaction of all assessments in

arrears.


    19
         Majority op., ¶2.
    20
         See majority op., ¶27.


                                           10
                                                                            No.    2014AP940.ssa


      ¶63     If an owner wants to live in a condominium unit at

Abbey      Springs    without        using    the       recreational    facilities,           the

owner need not pay any prior owner's delinquent assessments.21

      ¶64     A restriction on the use of recreational facilities

used as leverage to compel satisfaction of all assessments in

arrears is not, as the majority opinion claims, a right, title,

or interest by Abbey Springs in and to the foreclosed units.22

This court has allowed condominium associations to restrain an

owner's      use     of    a    unit.        If    a     condominium    association           can

restrict an owner's use of a unit, it surely can restrict the

use of recreational facilities.

      ¶65     In Apple Valley Gardens Ass'n, Inc. v. MacHutta, 2009

WI 28, ¶24, 316 Wis. 2d 85, 763 N.W.2d 126, the court held that

a   restriction       on       renting    units        was   a   "reasonable        rule[     or]

regulation[] governing the use of the units."

      ¶66     An     association's           prohibition         on   the     rental     of     a

condominium unit is permissible under Wis. Stat. § 703.10(1) and

(3), which permit a condominium association to adopt rules or
amend      its     bylaws       to      impose         restrictions    or         requirements




      21
       The owners, like other condominium owners, will still be
responsible for paying assessments coming due while they own the
unit.    They will not be responsible for any prior owners'
delinquent assessments.    See Wis. Stat. § 703.165(2) ("A unit
owner shall be liable for all assessments, or installments
thereof, coming due while owning a unit . . . .").
      22
           See majority op., ¶27.


                                                  11
                                                                No.   2014AP940.ssa


respecting the use of the units.23               If the rental restriction on

the use of a unit does not violate the right, title, or interest

of   an    owner   of   a   unit,   surely   a    restriction   or    requirement

limiting the use of recreational facilities24 does not violate

the right, title, or interest of an owner of a unit.25




      23
       Wisconsin   Stat.  § 703.10(1)  (with   added  emphasis)
provides: "The administration of every condominium shall be
governed by bylaws. Every unit owner shall comply strictly with
the bylaws and with the rules adopted under the bylaws, as the
bylaws or rules are amended from time to time . . . ."
Wisconsin Stat. § 703.10(3) provides:     "The bylaws also may
contain any other provision regarding the management and
operation of the condominium, including any restriction on or
requirement respecting the use and maintenance of the units and
the common elements."

     See also Wis. Stat. § 703.15(1), which provides that the
association's   board   of directors   generally  governs   the
association's affairs. The association has the power to, among
other things, "[e]xercise any other power conferred by the
condominium   instruments  or   bylaws."      See  Wis.   Stat.
§ 703.15(3)(a)4.

     The condominium association is created by a declaration on
file with the register of deeds, bylaws, and policies adopted by
the board of directors. See Wis. Stat. §§ 703.01(8), 703.07(1),
703.09, 703.10(1); Wisconsin Condominium Law Handbook, § 5.2
(4th ed. 2013).
      24
       Underscoring this conclusion, Abbey Springs' recreational
facilities are not common elements of the condominium in which
the units at issue are located. See majority op., ¶3.
      25
       The Wisconsin Condominium Law Handbook, § 5.50 (4th ed.
2013), describes Apple Valley as "indicat[ing] that restrictions
do not violate the provisions of the Condominium Ownership Act
and impl[ying] that broader restrictions may be enforceable. In
addition, the decision extends to the rules and regulations as a
source of restrictions." Abbey Springs' recreational use policy
is one such rule or regulation.


                                        12
                                                                        No.    2014AP940.ssa


    ¶67    A     logical       extension         of      the     majority          opinion's

conclusion that Abbey Springs' recreational use policy violates

the judgment of foreclosure is that restrictions on the use of a

unit by a condominium association in its declaration, bylaws, or

policies   (or       similar    restrictions          adopted      by    a    homeowner's

association) do not survive a judgment of foreclosure.

    ¶68    Under       this     reading       of      the      majority       opinion,       a

restriction      on    renting     condominium           units    contained         in     the

association's     bylaws       would    not     survive     a    foreclosure         action,

because it perpetually saddles the property and all subsequent

owners with the restriction on renting.26                       This court concluded

in Apple Valley, however, that such restrictions on renting are

permissible, see 316 Wis. 2d 85, ¶31, and the court of appeals

has recognized that such restrictions remain in force even after

a foreclosure.        See Bankers Tr. Co. of Cal. v. Bregant, 2003 WI

App 86, ¶15, 261 Wis. 2d 855, 661 N.W.2d 498 (recognizing that

although an action to enforce a bylaw restriction on rental was

premature,       it     was      "uncontroverted               that . . . the            bylaw
restriction     of     owner-occupancy          was      enforceable"         following      a

foreclosure sale).

    ¶69    Moreover, under this logical extension of the majority

opinion,     restrictions        imposed        by       homeowners'          associations

regarding,     for    instance,        repair      and    maintenance         of    a    home,

architecture of homes, or the placement of homes would similarly

be imperiled by a foreclosure action.                          Courts have concluded


    26
         See majority op., ¶23.


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that restrictions imposed by a homeowners' association survive a

foreclosure sale.            See Thirteen S. Ltd. v. Summit Vill., Inc.,

866   P.2d     257,    261    (Nev.     1993)      (holding        that    a     homeowners'

association's covenants, conditions, and restrictions were not

extinguished in a tax foreclosure sale).

      ¶70     The majority opinion disavows this logical extension

of    its     holding,       stating    that       restrictions           like       "[a]     use

restriction that prohibits dogs on condominium property . . ."

are permissible because they do not "depend on a prior owner's

actions      and   would      not   result      in    a    foreclosed          debt    forever

haunting a particular unit instead of following the prior owners

to whom the debt belongs."27                  The majority opinion continues,

asserting that such restrictions are permissible because they

"generally apply to all property owners equally and not just to

those who have the misfortune of purchasing units from prior

owners who left unpaid debts behind."28

      ¶71     This line of reasoning is flawed for several reasons.

      ¶72     First,     as    I    have   explained         above,       Abbey       Springs'
recreational       use     policy      does     not       create    a     spectral          debt,

"haunting" the unit until paid.                    A subsequent owner is free to

pay or not pay the prior owner's past due assessments.

      ¶73     Second,      Abbey       Springs'       recreational             use     policy,

despite the majority opinion's view, does "generally apply to




      27
            Majority op., ¶29.
      28
            Majority op., ¶29.


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all property owners equally . . . ."29 That is, all unit owners

are    subject    to     the   same    restriction,        and    any         unit   owners

(regardless of how they purchased the unit) will be barred from

the    recreational      facilities      if      there   are     unpaid        assessments

against the unit.

       ¶74    Third, and importantly, a purchaser buys a condominium

unit on notice of the condominium association's (or homeowners'

association's) declaration, bylaws, and policies.                              Prospective

purchasers who want to use the recreational facilities and are

unhappy about paying past due assessments may choose to purchase

the unit at a lower price or may chose to buy a different

property.        Although      the    majority      opinion      characterizes            this

situation as a "misfortune,"30 the buyer has a choice.

       ¶75    For the reasons stated, I conclude that Abbey Springs'

recreational      use    policy      does    not    constitute      a     lien       on   the

foreclosed       units     and    does      not     violate       the     judgment          of

foreclosure.

                                            II
       ¶76    Finally, addressing an argument made by Walworth State

Bank (and not resolved by the majority opinion),31 I conclude

that    Abbey    Springs'      recreational        use   policy    does        not   render

title to the foreclosed units unmarketable.



       29
            Majority op., ¶29.
       30
            See majority op., ¶29
       31
            See majority op., ¶13 n.7.


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    ¶77     Title is marketable if it "can be held in peace and

quiet; not subject to litigation to determine its validity; not

open to judicial doubt."               Apple Valley, 316 Wis. 2d 85,                   ¶27

(quotation omitted).

    ¶78     Walworth    State        Bank   argues   that   it    is    entitled       to

summary    judgment    on     its    declaratory     judgment     action        because

Abbey   Springs'   policy       renders      the   "title   [to   the       foreclosed

units] unmarketable, or at the very least, adversely affects its

marketability."

    ¶79     Wisconsin        Stat.     § 703.10(6)     prohibits            condominium

bylaws from affecting the transfer of title to a condominium

unit.       Wisconsin        Stat.    § 703.10(6)      states:     "Title         to    a

condominium    unit     is    not     rendered     unmarketable        or     otherwise

affected by any provision of the bylaws or by reason of any

failure of the bylaws to comply with the provisions of this

chapter."

    ¶80     This provision is "a protection of the title and is

not a vehicle for a finding of impairment."                   Apple Valley, 316
Wis. 2d 85, ¶29 (citing Bankers Tr., 261 Wis. 2d 855, ¶¶18-19)

(emphasis added).

    ¶81     Nevertheless, Walworth State Bank argues that Abbey

Springs'    recreational       use    policy     affects    the   quality       of     the

unit's title and its marketability.

    ¶82     In Apple Valley, we addressed whether a condominium

bylaw prohibiting the rental of a condominium unit rendered the

unit's title unmarketable.              The Apple Valley court determined
that although the rental restriction affected the use of the

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property, it did not affect the owner's ability to convey title.

Apple Valley, 316 Wis. 2d 85, ¶28.

     ¶83       The    same     is    true     in    the    instant      case.         Although

Walworth       State     Bank       presented       evidence     that    Abbey        Springs'

recreational use policy reduced the market value of the units,

it presented no evidence that the restriction affected Walworth

State Bank's ability to convey its title.

     ¶84       Walworth       State    Bank     has   not    presented        any     evidence

that the unavailability of the recreational facilities, which

were not part of the common areas and were available only for an

additional       cost,    rendered       the       title   to    the    foreclosed          units

unmarketable.

     ¶85       Following the foreclosure, Walworth State Bank took

title     to    the    units    free     and       clear    of   "'all       right,     title,

interest,       lien     or     equity       of     redemption'        in     and      to    the

property."32

     ¶86       Abbey Springs' recreational use policy simply allows

Abbey Springs to exclude an owner from access to Abbey Springs'
recreational facilities unless delinquent assessments are paid.

It does not affect the owner's ability to convey title.

                                            * * * *

     ¶87       Because I conclude that Abbey Springs' policy does not

violate        "well-established            foreclosure         law"    or        "effectively

revive[] a lien against" the units, and that Walworth State Bank

took title to the units following the foreclosure free of "all


     32
          Majority op., ¶6 (quoting the foreclosure judgment).


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right, title, interest, lien or equity of redemption" held by

Abbey Springs, I would affirm the court of appeals and remand to

the circuit court with instructions to grant summary judgment in

favor of Abbey Springs.

    ¶88   For      the   reasons   set       forth,   I   dissent   and   write

separately.

    ¶89   I   am    authorized     to    state    that    Justice   ANN   WALSH

BRADLEY joins this dissent.




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