Amjad T. Tufail v. Midwest Hospitality, LLC

2013 WI 62

SUPREME COURT OF WISCONSIN
CASE NO.: 2011AP1451
COMPLETE TITLE: Amjad T. Tufail,
Plaintiff-Respondent-Petitioner,
v.
Midwest Hospitality, LLC, d/b/a Midwest
Hospitality (WI),
LLC,
Defendant-Appellant,
Aslam Khan, d/b/a Midwest Hospitality,
Defendant.

REVIEW OF A DECISION OF THE COURT OF APPEALS
Reported at 344 Wis. 2d 297, 821 N.W.2d 412
(Ct. App. 2012 – Unpublished)

OPINION FILED: July 10, 2013
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: April 11, 2013

SOURCE OF APPEAL:
COURT: Circuit
COUNTY: Milwaukee
JUDGE: William S. Pocan

JUSTICES:
CONCURRED:
DISSENTED: PROSSER, J., dissents. (Opinion filed.)
NOT PARTICIPATING:

ATTORNEYS:
For the plaintiff-respondent-petitioner, there were briefs
by Douglas W. Rose, Lora L. LoCoco, and Rose & deJong, S.C.,
Milwaukee, and oral argument by Douglas W. Rose.

For the defendant-appellant, there was a brief by
Christopher T. Hale, Andrew G. Frank, and Hale and Wagner, S.C.,
Milwaukee, and oral argument by Christopher T. Hale.
 2013 WI 62
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2011AP1451

(L.C. No. 2009CV13848)

STATE OF WISCONSIN : IN SUPREME COURT

Amjad T. Tufail,

Plaintiff-Respondent-Petitioner,

v.

Midwest Hospitality, LLC, d/b/a Midwest
FILED
Hospitality (WI), LLC,
JUL 10, 2013
Defendant-Appellant,
Diane M. Fremgen
Clerk of Supreme Court
Aslam Khan, d/b/a Midwest Hospitality,

Defendant.

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

remanded. The judgment of the circuit court is thereby

affirmed.

¶1 ANN WALSH BRADLEY, J. This is a review of an

unpublished opinion of the court of appeals, which reversed the

circuit court's judgment awarding damages in favor of Amjad

Tufail (Tufail). The case before us involves a contract dispute
 No. 2011AP1451

between the landlord, Tufail, and the tenant, Midwest

Hospitality, LLC (Midwest Hospitality) over the terms of a

commercial lease of property.1

¶2 Tufail, the petitioner, asserts that the court of

appeals erred when it determined that Midwest Hospitality's

early termination of the lease was justified by Tufail's

misrepresentation. Although he acknowledges that the lease

unambiguously provides a representation that Midwest Hospitality
may not be prevented from using the property for certain

specified purposes, Tufail argues that operation of a fast-food

restaurant with a drive-through is not among the purposes listed

in the lease. He further asserts that all of the uses

identified in the lease are permitted uses of the premises under

the City of Milwaukee zoning code.

¶3 Additionally, Tufail contends that the representation

was not false given that the City of Milwaukee granted a special

use permit allowing the operation of a Church's Chicken

restaurant, including the operation of a Church's Chicken fast-
food restaurant with a drive-through.

¶4 We conclude that the representation does not include

any use of the property as a Church's Chicken fast-food

restaurant with a drive-through. Additionally, there is no

indication that any of the uses identified in the lease were

prevented under the City of Milwaukee zoning code.

1
Tufail v. Midwest Hospitality, LLC, No. 2011AP1451,
unpublished slip op. (Ct. App. Aug. 1, 2012), reversing the
circuit court, William S. Pocan, J., presiding.

2
 No. 2011AP1451

¶5 We further conclude that the representation was not

false because the circuit court found that Midwest Hospitality

was not prevented from using the property for the uses specified

in the lease, and its finding is not clearly erroneous.

Therefore, Tufail did not breach the lease. Accordingly, we

reverse the court of appeals and remand, and the judgment of the

circuit court is thereby affirmed.

I
¶6 The contract dispute in this case concerns the terms

of a commercial lease for a property located on West North

Avenue in Milwaukee, Wisconsin. Tufail had previously operated

a restaurant called "New York Chicken" on the property before

leasing the property to Midwest Hospitality.2

¶7 After purchasing the property in 2000, Tufail

submitted a request to the City of Milwaukee Development Center

for a permit to operate a fast-food restaurant. His application

was denied, but Tufail appealed to the City of Milwaukee Board

of Zoning Appeals. On November 9, 2000, the Board of Zoning
Appeals granted Tufail's request for a permit to operate a fast-

food restaurant for a ten-year period. Under the terms of the

permit, the New York Chicken restaurant was allowed to remain

open until 4:00 a.m.

¶8 Sometime before the New York Chicken restaurant ceased

operations in 2007 and again after operations ceased, Midwest

2
Tufail described the New York Chicken restaurant as "a
chicken place" that was similar in nature to a Church's Chicken
restaurant but with a different name.

3
 No. 2011AP1451

Hospitality approached Tufail and inquired about opening a

Church's Chicken restaurant on the property. Prior to

negotiating the lease, Midwest Hospitality visited the former

New York Chicken restaurant and conducted a walk-through of the

property. It then prepared a written lease and the parties

negotiated its terms.

¶9 Tufail and Midwest Hospitality formally executed the

lease in March 2008. It was to be in effect for a five-year
period beginning on April 1, 2008 and ending on March 31, 2013.

Midwest Hospitality agreed to pay rent in the amount of $35,000

for the first year, which was to be paid in equal installments

on a monthly basis.

¶10 Paragraph 5 of the lease specified the intended

purposes for which the property may be used:

5. Use of Premises. Tenant may use and occupy the
Premises for any lawful purposes, including, but not
limited to, the retail sales, consumption, and
delivery of food and beverages which shall include,
but not be limited to, Chicken products, Fish
products, bread products, salads, sandwiches, dessert
items, promotional items, and any other items sold by
any Church's Chicken store.
Tufail also made representations in Paragraph 33 of the lease,

which provide as follows, in relevant part:

Landlord represents and warrants to Tenant that:

. . . .

(g) no existing restrictions, building and zoning
ordinances, or other laws or requirements of any
governmental authority prevent the use of the Premises
for the purposes set forth in Paragraph 5 . . . .

4
 No. 2011AP1451

Landlord hereby acknowledges that Tenant is relying
upon all of the foregoing representations and
warranties in executing this Lease and that matters so
represented and warranted are material ones, and
Landlord accordingly agrees that any misrepresentation
or breach of such warranty will be reason for Tenant
to terminate this Lease.
Furthermore, the lease contained an integration clause providing

that the written lease set forth all understandings between

Tufail and Midwest Hospitality:

This Lease, the exhibits, rider and addendum, if any,
attached hereto and forming a part hereof set forth
all the covenants, promises, agreements, conditions,
terms, provisions and understandings by and between
the Landlord and Tenant concerning the Premises.
There are no other such matters, whether oral or
written, between Landlord and Tenant other than are
set forth herein. No change, modification,
alteration, amendment, addition or deletion to this
Lease shall be binding upon Landlord or Tenant unless
it is in writing and executed by the person to be so
charged with the same. Landlord and Tenant have
negotiated the terms of this Lease; therefore, this
Lease shall not be interpreted or construed against or
in favor of any party.
¶11 After the lease was executed, Midwest Hospitality

entered the property and began renovation. It completed some
initial preparation work, but did not ultimately complete the

renovations.
¶12 The renovation work ended in May 2008 when Midwest

Hospitality was informed that it needed to obtain a special use
permit in order to operate a fast-food restaurant with a drive-

through at the property. A special use permit is a particular
type of permit required by the City of Milwaukee in order to use

a property for certain purposes under the zoning code. Although

5
 No. 2011AP1451

a sit-down restaurant3 is classified as a "Permitted Use," a

fast-food restaurant4 is classified as a "Limited Use" requiring

a special use permit.

¶13 Upon being advised of the permit requirement, Midwest

Hospitality applied for a special use permit to operate a

Church's Chicken fast-food restaurant with a drive-through on

the property. The application was met with opposition by

community groups that opposed adding a Church's Chicken
restaurant to the neighborhood.5

¶14 Despite the opposition, the City of Milwaukee Board of

Zoning Appeals ultimately approved Midwest Hospitality's

application for a special use permit in a written decision

issued on September 22, 2008. The special use permit was issued

3
A "sit-down restaurant" is defined in the zoning code as
"a restaurant where the food or beverages sold are consumed at
tables located on the premises, where taking food or beverages
from the premises is purely incidental, where food or beverages
are normally served utilizing nondisposable containers and
utensils and where the consumption of food or beverages in
vehicles on the premises in which the building is located does
not regularly occur . . . ."
4
A "restaurant, fast-food/carryout" is defined in the
zoning code as "a restaurant other than a sit-down restaurant
where the manner of preparation, packaging and serving of food
or beverages encourages their consumption outside the building."
5
Midwest Hospitality in its brief describes those
individuals or groups opposing its application as "neighbors,
physicians, Walnut Way Conservation Corporation (a local
neighborhood association) and even a Wisconsin State
Representative."

6
 No. 2011AP1451

subject to certain conditions, which are set forth in relevant

part as follows:

10. That this use, both fast-food/carry-out and drive-
through, closes by 9:00 p.m.

11. That this Special Use is granted for a period of
one (1) year, commencing with the date hereof.
At trial, a Midwest Hospitality representative testified that

the conditions in the special use permit changed the business's

profitability forecast and rendered the operation of a Church's

Chicken restaurant on the property not worth the investment:

Q. And now could you have run the Church's Chicken at
1635 West North with restrictions on the evening hours
to 9:00 p.m. and a new review by [the Board of Zoning
Appeals] every year?

A. No way. It would just be impossible. It wouldn't
even be worth the investment. . . . [The 9:00 closing
restriction] changed our forecast that we had in mind
for the profitability of this business . . . .
¶15 After the special use permit was approved, Midwest

Hospitality notified Tufail that it would stop paying rent. It

sent a letter to Tufail arguing that it was not responsible for
the lease payments because a special use permit was required to

operate a Church's Chicken fast-food restaurant with a drive-

through. It therefore contended that Tufail made a false

representation and that it was entitled to terminate the lease

before the five-year term expired.

¶16 Tufail, in turn, commenced the present action. He

alleged a breach of contract claim, an anticipatory breach of

contract claim, and a claim for breach of the duty of good faith

and fair dealing. Midwest Hospitality later pled counterclaims

7
 No. 2011AP1451

alleging a breach of contract, deceptive advertising contrary to

Wis. Stat. § 100.18 (2009-10), and unjust enrichment.

¶17 The circuit court presided over a three-day bench

trial, which took place in March 2011. At the conclusion of the

trial, the circuit court made findings of fact relating to the

claims advanced in the pleadings. It found that the "vast

majority of Church's Chicken restaurants have drive-through

operations, but not all." Additionally, "Midwest Hospitality's
application for a special use permit to use the subject property

for a fast-food restaurant with a drive-through was approved by

the City of Milwaukee," and it was not "prevent[ed], in any way,

[] from opening a Church's Chicken restaurant at the subject

property with a drive-through and as a fast food restaurant."6

¶18 Turning to examine the text of the lease, the circuit

court determined that it unambiguously failed to set forth any

use as a fast-food restaurant with a drive-through. It

concluded that "Midwest Hospitality was able to use the subject

property for its intended use as set forth in the lease."
Furthermore, it determined that "even if the subject lease was

interpreted to include as an intended use a fast food restaurant

with a drive-through, that intended use was allowed by the City

of Milwaukee." Ultimately, there was "no evidence presented

that [Tufail's] representations and warranties were not true."

6
Additional discussion of the circuit court's findings of
fact may be found at ¶¶39-41, infra.

8
 No. 2011AP1451

¶19 Because Tufail did not breach the lease, the circuit

court concluded that Midwest Hospitality's early termination of

the lease was itself a breach of contract. It proceeded to

enter a judgment awarding Tufail $90,033.21 in damages.

¶20 Midwest Hospitality appealed and the court of appeals

reversed the circuit court. Tufail v. Midwest Hospitality, LLC,

No. 2011AP1451, unpublished slip op. (Ct. App. Aug. 1, 2012).

It concluded that the "early termination of the lease was
justified by Tufail's misrepresentation," stating that Tufail's

representation that "no zoning laws restricting [Midwest

Hospitality's] operation of a Church's Chicken fast-food

restaurant on the leased premises" was "false from the moment

the parties signed the lease." Id., ¶¶1, 9.
¶21 The court of appeals rejected Tufail's argument that

he did not make a false representation because the lease does

not set forth a use as a fast-food restaurant with a drive-

through. Id., ¶8. It concluded that by reference to "Church's

Chicken," Paragraph 5 of the lease "allowed the operation as a

Church's Chicken" and that it was "not necessary for the use

provision in the lease to include additional words allowing

operation of a fast-food restaurant. A Church's Chicken is a

fast-food restaurant." Id.

II

¶22 This case requires us to determine whether Tufail

breached the lease, a written contract, by making a false

representation. The interpretation of a contract presents a

9
 No. 2011AP1451

question of law, which we determine independently of the

conclusions rendered by the circuit court and the court of

appeals. Ehlinger v. Hauser, 2010 WI 54, ¶47, 325 Wis. 2d 287,

¶47, 785 N.W.2d 328.

¶23 Here, the circuit court presided over a three-day

bench trial and made findings of fact. We accept the circuit

court's findings of fact unless they are clearly erroneous.

Phelps v. Physicians Ins. Co. of Wisconsin, Inc., 2009 WI 74,
¶34, 319 Wis. 2d 1, 768 N.W.2d 615.

III

¶24 The sole question presented on review is whether

Tufail breached the lease by making a false representation. The

lease is a written contract and our analysis is controlled

entirely by well-established canons of contract interpretation.

Accordingly, as a preface to addressing the question presented,

it is helpful to review those basic principles of contract

interpretation relevant to the issue before us.

¶25 Contract interpretation generally seeks to give effect

to the parties' intentions. Seitzinger v. Community Health

Network, 2004 WI 28, ¶22, 270 Wis. 2d 1, 676 N.W.2d 426.

However, "subjective intent is not the be-all and end-all."

Kernz v. J.L. French Corp., 2003 WI App 140, ¶9, 266 Wis. 2d

124, 667 N.W.2d 751. Rather, "unambiguous contract language

controls contract interpretation." Id.

¶26 Where the terms of a contract are clear and

unambiguous, we construe the contract according to its literal

10
 No. 2011AP1451

terms. Maryland Arms Ltd. Partnership v. Connell, 2010 WI 64,

¶23, 326 Wis. 2d 300, 786 N.W.2d 15 (quoting Gorton v. Hostak,

Henzl & Bichler, S.C., 217 Wis. 2d 493, 506, 577 N.W.2d 617

(1998)). "We presume the parties' intent is evidenced by the

words they chose, if those words are unambiguous." Kernz, 266

Wis. 2d 124, ¶9.

¶27 If the terms of the contract are ambiguous, evidence

extrinsic to the contract itself may be used to determine the
parties' intent. Seitzinger, 270 Wis. 2d 1, ¶22. "A contract
provision is ambiguous if it is fairly susceptible of more than

one construction." Mgm't Computer Servs., Inc. v. Hawkins, Ash,

Baptie & Co., 206 Wis. 2d 158, 177, 557 N.W.2d 67 (1996).

¶28 Contract language is construed according to its plain

or ordinary meaning, Huml v. Vlazny, 2006 WI 87, ¶52, 293 Wis.

2d 169, 716 N.W.2d 807, consistent with "what a reasonable

person would understand the words to mean under the

circumstances." Seitzinger, 270 Wis. 2d 1, ¶22. For a business

contract, that is "the manner that it would be understood by

persons in the business to which the contract relates." Columbia

Propane, L.P. v. Wisconsin Gas Co., 2003 WI 38, ¶12, 261 Wis. 2d

70, 661 N.W.2d 776.

¶29 The court construes contracts "as they are written."

Id., ¶12. Ultimately, "the office of judicial construction is

not to make contracts . . . but to determine what the parties

contracted to do." Marion v. Orson's Camera Centers, Inc., 29

Wis. 2d 339, 345, 138 N.W.2d 733 (1966) (quoting Wisconsin

11
 No. 2011AP1451

Marine & Fire Ins. Co. Bank v. Wilkin, 95 Wis. 111, 115, 69 N.W.

354 (1897).

¶30 Additionally, as this court recently stated, courts

may not consider evidence of prior or contemporaneous oral or

written agreements between the parties if a contract is fully

integrated:

A contract that represents the final and complete
expression of the parties' agreement is considered
fully "integrated." If the contract is integrated,
absent the existence of fraud, duress, or mutual
mistake, the court construing the contract may not
consider evidence of any prior or contemporaneous oral
or written agreement between the parties.
Town Bank v. City Real Estate Development, LLC, 2010 WI 134,
¶37, 330 Wis. 2d 340, 793 N.W.2d 476. If a contract contains

"an unambiguous merger or integration clause, the court is

barred from considering evidence of any prior or contemporaneous

understandings or agreements between the parties, even as to the

issue of integration." Id., ¶39; Peterson v. Cornerstone

Property Development, LLC, 2006 WI App 132, ¶31, 294 Wis. 2d

800, 720 N.W.2d 716 (quoting Ziegler Co. v. Rexnord, Inc., 139

Wis. 2d 593, 608-09 n.11, 407 N.W.2d 873 (1987)) (courts may not

consider extrinsic evidence to "vary or contradict the terms of

a writing" when the contract is fully integrated).

¶31 In this case, as quoted above, the lease at issue

contains an integration clause. It states that the entire

agreement between the parties has been reduced to writing. It

plainly states without qualification that "all" of the

understandings between the parties are set forth in the lease

12
 No. 2011AP1451

and any attached exhibits, riders, or addendums. Therefore, we

are guided by the text of the lease, not by any extrinsic,

unwritten understandings that may have existed between the

parties.7 Id.; Peterson, 294 Wis. 2d 800, ¶31 (quoting Ziegler

Co., 139 Wis. 2d at 608-09 n.11).

¶32 Having reviewed the relevant canons of contract

interpretation, we turn now to address the question of whether

Tufail breached the lease by making a false representation. Our
inquiry hinges first on the meaning of Tufail's representation

as it is written in the lease, and second, on whether the

representation is false under the facts of this case. The

representation states as follows:

Landlord represents and warrants to Tenant that:

. . . .

7
Contrary to the unambiguous integration clause, Midwest
Hospitality urges us to consider the parties' unwritten
"understanding of Church's Chicken" as a fast-food restaurant.
It contends that "Church's Chicken was understood to be a fast-
food restaurant by all parties," and that understanding is
"inherent in interpreting [the lease's references to] 'Church's
Chicken' . . . regardless of the absence of 'fast-food' in the
Use of Premises provision." In effect, it contends that "there
is no such thing" as a sit-down Church's Chicken restaurant.

Here, however, the parties have expressly stated that
"[t]his Lease . . . set[s] forth all the . . . understandings by
and between the Landlord and Tenant concerning the Premises."
In light of the parties' unambiguous statement that no
additional understandings existed between them concerning the
lease, we decline to consider Midwest Hospitality's
"understanding of Church's Chicken" as a particular type of
fast-food restaurant when such an understanding is not presented
in the text of the lease.

13
 No. 2011AP1451

(g) no existing restrictions, building and zoning
ordinances, or other laws or requirements of any
governmental authority prevent the use of the Premises
for the purposes set forth in Paragraph 5 . . . .
Paragraph 5 of the lease, in turn, provides that:

5. Use of Premises. Tenant may use and occupy the
Premises for any lawful purpose, including, but not
limited to, the retail sales, consumption, and
delivery of food and beverages which shall include,
but not be limited to, Chicken products, Fish
products, bread products, salads, sandwiches, dessert
items, promotional items, and any other items sold by
any Church's Chicken store.
¶33 Tufail acknowledges that the lease unambiguously

provides that Midwest Hospitality may not be prevented from

using the property for certain specified purposes. He advances,

however, that a fast-food restaurant with a drive-through is not

among the "purposes set forth in Paragraph 5." Furthermore, he

asserts that all of the uses identified in Paragraph 5 are

permitted uses of the premises under the City of Milwaukee

zoning code. Given that the City of Milwaukee granted a special

use permit allowing the operation of a Church's Chicken

restaurant, including the operation of a Church's Chicken fast-

food restaurant with a drive-through, he contends that the

representation was not false.

¶34 Midwest Hospitality likewise acknowledges the

unambiguous text of the lease, but further argues that the lease

14
 No. 2011AP1451

incorporates the fact that "Church's Chicken was understood to

be a fast-food restaurant by all parties."8

¶35 We construe the contract as it is clearly written.

Midwest Hospitality may not be prevented from using the property

for the purposes specifically identified in Paragraph 5.

Paragraph 5 then identifies the various products which may be

consumed, sold, distributed, or otherwise used on the property.

¶36 Among the products identified in Paragraph 5 is
counted "any other items sold by any Church's Chicken store."

Midwest Hospitality argues, and the court of appeals concluded,

that the reference to a "Church's Chicken" in Paragraph 5

requires that a Church's Chicken fast-food restaurant with a

drive-through may be operated on the property. We reject that

argument.

8
Tufail states in his brief that "[t]he lease is
unambiguous," while Midwest Hospitality argues that Tufail
"unambiguously warrantied that there were no zoning restrictions
preventing . . . the contemplated use of the Property." Their
respective "unambiguous" constructions of the lease diverge
greatly in scope.

That the parties have construed the representation
differently does not alone render it ambiguous. Ambiguity is
found where a contract "is fairly susceptible of more than one
construction," not necessarily where different constructions are
argued. Mgm't Computer Servs., Inc. v. Hawkins, Ash, Baptie &
Co., 206 Wis. 2d 158, 177, 557 N.W.2d 67 (1996). We must
interpret the lease "as it stands, even though the parties may
have placed a different construction on it." Cernohorsky v.
Northern Liquid Gas Co., 268 Wis. 586, 593, 68 N.W.2d 429
(1955); see also Brew City Redevelopment Group, LLC v. The
Ferchill Group, 2006 WI App 39, ¶3, 289 Wis. 2d 795, 714 N.W.2d
582.

15
 No. 2011AP1451

¶37 A mere reference to products used by a "Church's

Chicken store" does not represent that Midwest Hospitality may

operate a Church's Chicken fast-food restaurant with a drive-

through. The lease plainly provides that Midwest Hospitality

may not be prevented from using the property for certain,

specified purposes. Notably absent from that list is any

requirement that the property may be used as a fast-food

restaurant with a drive-through.9
¶38 Accordingly, we conclude that Tufail's representation

requires simply that Midwest Hospitality may not be prevented

from using the property for the purposes specifically identified

in Paragraph 5. Having ascertained the plain meaning of the

representation, all that remains is to determine whether the

representation is false under these facts.

9
Likewise, the lease does not set forth any requirements
regarding the conditions specified in the special use permit
relating to the hours of operation or the time period in which
any permit must be renewed. Despite the lack of reference to a
fast-food restaurant or to the conditions set forth in the
special use permit, the dissent interprets the lease to mean
that Tufail "warrant[ied] that there were no zoning requirements
with which Midwest had to comply in order to sell Church's
Chicken products in a fast-food restaurant." Dissent, ¶78; see
also dissent, ¶¶94, 101.

In relying on words that cannot be found in the lease, the
dissent appears to rewrite it. The representation in the lease
simply states that no existing restrictions, building and zoning
ordinances, or other laws or requirements prevent Midwest
Hospitality from using the property for the purposes identified
in Paragraph 5. It focuses on whether Midwest Hospitality is
prevented from using the property for certain purposes, not on
whether Midwest Hospitality had to comply with various
governmental regulations.

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 No. 2011AP1451

¶39 In this case, the circuit court made extensive

findings of fact at the conclusion of a three-day bench trial.

It found that "[t]he vast majority of Church's Chicken

restaurants have drive-through operations, but not all." There

was "no evidence" showing that Tufail knew about the many other

Church's Chicken restaurants, whether or not they had drive-

through operations, or about Church's Chicken franchise

requirements such as closing times.
¶40 The circuit court also found that the parties "entered

into a written lease in March of 2008," which was, by its own

terms, to last for a five-year period. After the lease was

signed and Midwest Hospitality took occupancy, it discovered

that a special use permit was required from the City of

Milwaukee "so that it could have a drive-through as part of the

restaurant."

¶41 Furthermore, the circuit court found that "Midwest

Hospitality's application for a special use permit to use the

subject property for a fast food restaurant with a drive-through
was approved by the City of Milwaukee." Although it observed

that the approval "was not exactly as Midwest Hospitality may

have wanted" due to the conditions in the special use permit, it

found that Midwest Hospitality was not prevented, "in any way,

[] from opening a Church's Chicken restaurant at the subject

property." The special use permit allowed operation "with a

drive-through and as a fast food restaurant":

But the special use permit as approved by the City of
Milwaukee did not prevent, in any way, Midwest

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 No. 2011AP1451

Hospitality from opening a Church's Chicken restaurant
at the subject property with a drive-through and as a
fast food restaurant. Therefore, the Court finds that
even if the subject lease was interpreted to include
as an intended use a fast food restaurant with a
drive-through, that intended use was allowed by the
City of Milwaukee. The representations and warranties
of Mr. Tufail contained in the lease itself are for
the intended use as specifically set forth in the
lease in paragraph five, and there was no evidence
presented that those representations and warranties
were not true.
Accordingly, the circuit court determined that "the claim that

Mr. Tufail made misrepresentations was not established."
¶42 No one argues that the findings of the circuit court,

to the extent that they set forth the dispositive facts of this

case, are clearly erroneous. Phelps, 319 Wis. 2d 1, ¶34. We
likewise see no indication that its findings are clearly

erroneous. Therefore, we are bound to accept those findings,

including the circuit court's finding that Midwest Hospitality

was not in fact prevented from opening a Church's Chicken

restaurant at the subject property.

¶43 Given the lack of any reference in the lease to a
fast-food restaurant with a drive-through, there is no

indication in the facts that the uses of the property, as they

are stated in Paragraph 5 of the lease, were prevented. There

is no indication that any of the uses specified in Paragraph 5

cannot be performed at a sit-down restaurant, which is a

permitted use under the City of Milwaukee zoning code. Rather,

the fact that Midwest Hospitality was granted a special use

permit specifically allowing use of the property as a Church's

Chicken restaurant soundly refutes the premise that Midwest

18
 No. 2011AP1451

Hospitality was prevented from using the property for any of the

purposes stated in Paragraph 5.

¶44 We further observe that even if we accepted Midwest

Hospitality's argument that there is an "undisputed

understanding of Church's Chicken" as a fast-food restaurant

with a drive-through and that the representation incorporates

that "undisputed understanding," the representation is still not

false under these facts. The circuit court expressly found that
when the special use permit was granted by the City of

Milwaukee, Midwest Hospitality was allowed to operate a Church's

Chicken fast-food restaurant with a drive-through.

¶45 The facts of this case indicate that although Midwest

Hospitality was not prevented from using the property for the

purposes identified in Paragraph 5 of the lease, those purposes

alone did not necessarily ensure that the proposed Church's

Chicken restaurant was worth Midwest Hospitality's investment.

However, as the circuit court observed, "[t]here was nothing to

prevent Midwest Hospitality from putting contingencies in the
lease about hours of operation, a drive-through or anything else

deemed necessary. It did not." We interpret only the contract

to which the parties agreed. Marion, 29 Wis. 2d at 345.

¶46 Ultimately, the result of this case is compelled by

basic principles of contract interpretation and by the circuit

court's findings of fact following a three-day bench trial.

Tufail explicitly represented in paragraph 33 of the lease that

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 No. 2011AP1451

Midwest Hospitality would not be prevented from using the

property for the listed purposes.

¶47 The circuit court found that there was no evidence to

support the argument that the representations were untrue.

Additionally, it found that Midwest Hospitality was not

prevented "in any way" from opening a Church's Chicken

restaurant at the leased property.

• "The representations and warranties of Mr. Tufail
contained in the lease itself are for the intended use

as specifically set forth in the lease in paragraph

five, and there was no evidence presented that those

representations and warranties were not true."

• "[T]he special use permit as approved by the City of

Milwaukee did not prevent, in any way, Midwest

Hospitality from opening a Church's Chicken restaurant

at the subject property with a drive-through and as a

fast food restaurant."

¶48 Importantly, the circuit court specifically found that
even if the lease was interpreted to include uses not explicitly

listed in its terms——uses as a fast-food restaurant with a

drive-through——that the evidence showed that such uses were not

prevented.

• "Therefore, the Court finds that even if the subject

lease was interpreted to include as an intended use a

fast food restaurant with a drive-through, that

intended use was allowed by the City of Milwaukee."

20
 No. 2011AP1451

¶49 There has been no showing that the circuit court's

dispositive findings of fact are clearly erroneous. No party

has even attempted to advance such an argument. Accordingly, we

conclude that Tufail did not breach the lease by making a false

representation.

IV

¶50 In sum, we conclude that the representation does not

include any use of the property as a Church's Chicken fast-food
restaurant with a drive-through. Additionally, there is no

indication that any of the uses identified in the lease were

prevented under the City of Milwaukee zoning code.

¶51 We further conclude that the representation was not

false because the circuit court found that Midwest Hospitality

was not prevented from using the property for the uses specified

in the lease, and its finding is not clearly erroneous.

Therefore, Tufail did not breach the lease. Accordingly, we

reverse the court of appeals and remand, and the judgment of the

circuit court is thereby affirmed.
By the Court.—The decision of the court of appeals is

reversed and remanded. The judgment of the circuit court is

thereby affirmed.

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 No. 2011AP1451.dtp

¶52 DAVID T. PROSSER, J. (dissenting). Amjad Tufail

(Tufail) and Midwest Hospitality, LLC (Midwest) entered into a

lease in which Tufail unambiguously warranted that there were no

local ordinances that would prevent Midwest from operating a

fast-food Church's Chicken restaurant on Tufail's property. The

majority opinion concludes that Tufail did not breach this

warranty because the lease did not define "Church's Chicken" as

a fast-food restaurant. However, the only reasonable meaning of

"Church's Chicken" is a fast-food restaurant.

¶53 Even if the lease were deemed ambiguous, the extrinsic

evidence demonstrates that Church's Chicken is a fast-food

restaurant, and both parties were aware of that fact when they

signed the lease. Tufail's warranty that no ordinances

prevented the operation of a Church's Chicken was false because

the Milwaukee zoning code requires any freestanding fast-food

restaurant to have a special use permit. Therefore, Tufail

breached the lease.

¶54 The majority opinion employs a sterile, technical

interpretation of the lease that abandons the basic principles

of contract interpretation. When interpreting a contract, the

court's goal has always been to effect the intent of the parties

as it is expressed in the language of the contract. The

importance of upholding this principle cannot be overstated

because people in business use contracts to try to minimize

uncertainty in relation to their reasonable expectations.

¶55 Parties generally enter agreements to advance their

economic interests. Risks, of course, are inevitable. But if

1
 No. 2011AP1451.dtp

one party is able to frustrate the basic purpose of a contract

through an unreasonable interpretation of its terms and

commitments, instability will follow, and we will be left with a

system of law that rewards the more cunning party and disregards

mutual intent. Because the majority opinion supports an

implausible interpretation of the lease contract in this case, I

must respectfully dissent.

I

¶56 In 2000 Tufail purchased a property with a

freestanding building located at 1635 West North Avenue (the

Property) in Milwaukee. The Property was operated as a New York

Chicken fast-food restaurant, and Tufail continued that

operation until the fall of 2007. The Property had formerly

been a Church's Chicken. In fact, Tufail later testified that

"it was an old design Church's Chicken which [he] was running."

Tufail was not inexperienced in the restaurant business; he

owned four other restaurants.

¶57 When he acquired the Property in 2000, Tufail wanted

to continue operating the fast-food restaurant. His request was

denied by a city plan examiner. Tufail was told that a fast-

food restaurant was a special use under the zoning code and he

would need to obtain a special use permit. He eventually

acquired a ten-year special use permit from the Milwaukee Board

of Zoning Appeals (BOZA). When Tufail temporarily closed the

restaurant in or about October of 2007, he had approximately

three years left on his ten-year special use permit before it

would have to be renewed.

2
 No. 2011AP1451.dtp

¶58 Midwest approached Tufail about opening a Church's

Chicken restaurant at the Property both before and after Tufail

shut down operation of his New York Chicken. Midwest is a

corporate entity that operates Church's Chicken restaurants and

is owned by Aslam Khan (Khan). Munshi Ali, a Church's Chicken

manager at a different location, approached Tufail four or five

times and stated that Khan wanted to lease Tufail's property to

operate a Church's Chicken. Khan himself eventually visited the

Property with several other people affiliated with Church's

Chicken. Khan stated that he owned many Church's Chicken

restaurants in the Midwest and said that Tufail's property value

would go up if Church's Chicken moved in.

¶59 Two or three days after Khan visited the Property,

Khan sent an agent, Tariq Malik (Malik), to Tufail with a lease

drafted by Midwest. Malik and Tufail went to Tufail's attorney,

who made some changes to the lease. However, the attorney did

not alter Paragraph 5, which contained the provisions regarding

the use of the premises. At some point before he signed the

lease, Tufail visited a Church's Chicken at another location to

see how Midwest would alter the Property.

¶60 Tufail and Midwest entered into a five-year lease (the

Lease) for the Property in March 2008. The "Use of Premises"

section in Paragraph 5 of the Lease stated:

Tenant may use and occupy the Premises for any
lawful purpose, including, but not limited to, the
retail sales, consumption, and delivery of food and
beverages which shall include, but not be limited to,
Chicken products, Fish products, bread products,
salads, sandwiches, dessert items, promotional items,

3
 No. 2011AP1451.dtp

and any other items sold by any Church's Chicken
store.
¶61 The "Representations and Warranties" section of the

Lease, in Paragraph 33(g), stated that the landlord represents

and warrants that "no existing restrictions, building and zoning

ordinances, or other laws or requirements of any governmental

authority prevent the use of the Premises for the purposes set

forth in Paragraph 5."

¶62 The Lease also stated at the end of the

"Representations and Warranties" section that the

representations and warranties "are material ones, and Landlord

accordingly agrees that any misrepresentation or breach of such

warranty will be reason for Tenant to terminate this Lease."

¶63 Regarding interpretation of these provisions,

Paragraph 38 of the Lease said, "This Lease shall be interpreted

to the broadest extent possible to give full and fair meaning to

the intentions of the parties hereto." (Emphasis added.)

¶64 Midwest entered the Property and began remodeling it

in May 2008. According to Midwest, the Property required a

substantial amount of cleaning and repair work. However,

Midwest suspended the renovation when it was denied a building

permit.

¶65 When Midwest applied for that permit, it was told that

it would have to apply for a special use permit to operate a

fast-food restaurant in a freestanding building. The examiner

for the City, Barbara Jones, stated in her denial letter that

the Milwaukee zoning code did not allow the Property to be used

as a fast-food restaurant. Thus, Midwest unexpectedly learned

4
 No. 2011AP1451.dtp

that it was faced with the same obstacles with zoning ordinances

that Tufail had faced roughly eight years earlier. What Midwest

did not know was that Tufail's business had been cited for 21

health code violations by the city in 2007 and had antagonized a

lot of nearby residents.

¶66 On May 29, 2008, Midwest applied for a special use

permit to operate a fast-food restaurant with a drive-through

within 150 feet of residential property. Four sections of the

City of Milwaukee zoning code were in play. Section 295-203-

9.f. defines a sit-down restaurant as:

a restaurant where the food or beverages sold are
consumed at tables located on the premises, where
taking food or beverages from the premises is purely
incidental, where food or beverages are normally
served utilizing nondisposable containers and utensils
and where the consumption of food or beverages in
vehicles on the premises in which the building is
located does not regularly occur, or where the
restaurant is located within a building containing
more than one principal use other than another
restaurant. This term does not include a tavern.
¶67 Section 295-203-9.g. defines a fast-food or carry-out

restaurant as "a restaurant other than a sit-down restaurant

where the manner of preparation, packaging and serving of food
or beverages encourages their consumption outside the building.

This term does not include a tavern." Section 295-603-2.o.

requires that a fast-food restaurant be in a building containing

at least one permitted use, or the restaurant must get a special

use permit. Finally, Section 295-603-2.j.3. states that a

drive-through may not be located within 150 feet of residential

property.

5
 No. 2011AP1451.dtp

¶68 Midwest's intended use of the Property was

inconsistent with the definition of a sit-down restaurant. The

city immediately recognized that Church's Chicken, like the

prior New York Chicken, is a fast-food restaurant and it would

likely expect to use the existing drive-through. Thus, without

a special use permit, operating a Church's Chicken on the

Property would violate two separate zoning code provisions: the

prohibition against operating a freestanding fast-food

restaurant and the prohibition against having a drive-through

within 150 feet of residential property.

¶69 In September 2008, approximately six months after it

signed the Lease, Midwest obtained a special use permit to

operate the restaurant. However, the city imposed very

different conditions on Midwest from the conditions it had

imposed on Tufail. Tufail obtained a ten-year permit; Midwest

received a one-year permit with no assurance of renewal. Tufail

was permitted to operate until 4:00 a.m. Midwest could operate

its Church's Chicken until only 9:00 p.m. The city's permit

also required Church's Chicken to pick up all garbage within a

one-block radius of the Property. The president of Falcon

Holdings, which operates Midwest, testified that it would be too

expensive to take care of all the garbage within a block of the

Property and that a Church's Chicken would be less profitable if

it had to close at 9:00 p.m.

¶70 The BOZA chairman stated that Midwest faced a

difficult decision whether to invest "hundreds of thousands of

dollars for a one year approval by this board. There is no

6
 No. 2011AP1451.dtp

guarantee of an approval after one year." The local community

appeared to share the chairman's concern, and many city

residents opposed the special use permit.

¶71 Due to the long delay in obtaining any special use

permit and then the severe restrictions added to the permit,

Midwest stopped paying rent.

II

¶72 The plain language of the Lease unambiguously

demonstrates that the parties intended for Midwest to operate a

Church's Chicken fast-food restaurant on the Property. The

court's goal in contract interpretation is to discern the

intentions of the parties as expressed in the language of the

contract. Town Bank v. City Real Estate Dev., LLC, 2010 WI 134,

¶33, 330 Wis. 2d 340, 793 N.W.2d 476. The court will look at

the ordinary meaning of the contractual language, and if it is

unambiguous, the contractual interpretation remains within the

four corners of the contract. Id. A contract is ambiguous when

"it is susceptible to more than one reasonable interpretation."
Id.

¶73 The broad language in the Lease unambiguously suggests

that Midwest could have operated almost any lawful business on

the Property. Paragraph 5 of the Lease states that "Tenant may

use and occupy the Premises for any lawful purpose . . . ." It

was not unreasonable for Midwest to assume that it could operate

a freestanding fast-food restaurant because that is a seemingly

lawful purpose and because New York Chicken had operated on the

property in that manner. Moreover, the Lease quickly narrows

7
 No. 2011AP1451.dtp

its intent by adding the words "including . . . the retail

sales, consumption, and delivery of food and beverages." Then

the Lease pinpoints its objective by naming "Chicken products,

Fish products, bread products, salads, sandwiches, dessert

items, promotional items, and any other items sold by any

Church's Chicken store." (Emphasis added.)

¶74 The Lease in this case is unambiguous because it uses

"Church's Chicken" according to its ordinary meaning: a fast-

food restaurant.1 The Lease states that Midwest may use the

Property for "retail sales, consumption, and delivery of food

and beverages which shall include . . . Chicken

products . . . and any other items sold by any Church's Chicken

store."

¶75 Courts must interpret a contract "in the manner that

it would be understood by persons in the business to which the

contract relates." Columbia Propane, L.P. v. Wis. Gas Co., 2003

WI 38, ¶12, 261 Wis. 2d 70, 661 N.W.2d 776.2 In the restaurant

business, "Church’s Chicken is a highly recognized brand name in
the Quick Service Restaurant sector and is one of the largest

quick-service chicken concepts in the [w]orld." Church's

Chicken Celebrates Its Southern Hospitality with Kick Off of New

1
Interestingly, the first Church's Chicken restaurant was
called "Church's Fried Chicken-To-Go." One Man, One Chicken
Legacy, Churchs.com, http://www.churchs.com/about.html (last
visited June 25, 2013). Church's Chicken has always been a
fast-food restaurant.
2
See also N. Gate Corp. v. Nat'l Food Stores, 30
Wis. 2d 317, 321, 140 N.W.2d 744 (1966); All-Star Ins. Corp. v.
APS Ins. Agency, Inc., 112 Wis. 2d 329, 333, 332 N.W.2d 828 (Ct.
App. 1983); 17A Am. Jur. 2d Contracts § 337 (2004).

8
 No. 2011AP1451.dtp

Advertising Campaign, (Nov. 3, 2011),

http://www.businesswire.com/news/home/20111103005028/en/Church%E

2%80%99s-Chicken-Celebrates-Southern-Hospitality-Kick-

Advertising. Because of Church's Chicken's "highly recognized

brand name," the court of appeals had no trouble asserting that,

"[i]t is undisputed here that a Church's Chicken is a fast-food

restaurant. It was not necessary for the use provision in the

lease to include additional words allowing operation of a fast-

food restaurant. A Church's Chicken is a fast-food restaurant."

Tufail v. Midwest Hospitality, LLC, No. 2011AP1451, unpublished

slip op., ¶8 (Wis. Ct. App. Aug. 1, 2012).

¶76 Even though Tufail is correct that not everyone would

understand what a Church's Chicken is, its reputation in the

restaurant industry demonstrates that those in the business

would know that it is a fast-food restaurant.3 Since the only

reasonable meaning of "Church's Chicken" is a fast-food chicken

restaurant, a paragraph that allows for the sale of "items sold

by any Church's Chicken store" unambiguously contemplates the
operation of the Property as a fast-food restaurant.

¶77 Furthermore, the Lease explicitly calls for broad

interpretation to avoid an unfair reading of the contract and to

"give full and fair meaning to the intentions of the parties."

It would not be reasonable to define "Church's Chicken" in a way

that contradicts its true definition. Midwest persuasively

argues that "Church's Chicken" must refer to a fast-food

3
At trial, Tufail's own expert understood that a Church's
Chicken is a fast-food restaurant and that Midwest intended to
operate a freestanding Church's Chicken on the Property.

9
 No. 2011AP1451.dtp

restaurant because all Church's Chicken restaurants are fast-

food restaurants. Since the zoning code did not permit a fast-

food restaurant on the Property and Church's Chicken is a fast-

food restaurant, Tufail's warranty that no ordinances prevented

the operation of a Church's Chicken on the Property was false.4

¶78 The problem with Tufail's warranty is apparent when

compared to another Lease provision. Paragraph 24(b) says, "If

allowed by local governmental authorities, Tenant shall have the

right to erect and maintain exterior free standing sign(s) in

the location set forth on Exhibit 'A'. Landlord agrees to

cooperate fully with Tenant in obtaining all required

governmental permits, licenses, approvals and variances for

Tenant's sign(s)." This paragraph is clear that the tenant

might need to get government permits or variances in order to

erect the desired signage. In contrast, Paragraph 33(g)

provides a broad warranty that there are no "requirements of any

governmental authority" that would prevent the tenant from using

the Property as specified in Paragraph 5. Tufail was not forced

to embrace the broad warranty in Paragraph 33(g). He could have

made a qualified commitment as appears in Paragraph 24(b), or he

could have forthrightly disclosed the zoning regulations and

made the Lease contingent upon receipt of a satisfactory special

4
The majority opinion observes that the circuit court made
a finding of fact that not all Church's Chicken restaurants have
a drive-through. Majority op., ¶39. However, the drive-through
issue is a red herring. Church's Chicken is undeniably a fast-
food restaurant chain. The zoning code prohibited the operation
of a freestanding fast-food restaurant regardless of whether
that restaurant had a drive-through. Tufail warranted against
that obstacle.

10
 No. 2011AP1451.dtp

use permit. However, because Tufail warranted that there were

no zoning requirements with which Midwest had to comply in order

to sell Church's Chicken products in a fast-food restaurant,

Tufail must be held to his promise.

III

¶79 Tufail's warranty that no restrictions prevent the

operation of a Church's Chicken is unambiguous, but even if

"Church's Chicken" is deemed ambiguous, the parol evidence

demonstrates that the parties understood Church's Chicken to be

a fast-food restaurant. If a contract is ambiguous, the court

may use parol evidence to explain the ambiguous term. Town

Bank, 330 Wis. 2d 340, ¶38. Tufail admitted that "[t]he

intended purpose of the Lease, as represented by Midwest, was

for it to open a new Church's Chicken restaurant at the Leased

Premises." Tufail had to know that Church's Chicken is a fast-

food restaurant because his New York Chicken restaurant was an

old Church's Chicken. Furthermore, Tufail saw that Church's

Chicken is a fast-food restaurant when he visited one before
signing the Lease.

¶80 Tufail's visit is important because the parties'

course of dealings can clarify contractual ambiguities. See

Martinson v. Brooks Equip. Leasing, Inc., 36 Wis. 2d 209, 219,

152 N.W.2d 849 (1967). In Martinson, the contract for the

construction of a pool was ambiguous because it incorporated

plans for a pool but did not explicitly incorporate plans for a

filter system. Id. at 218-19. However, the evidence showed

that the appellant knew that the filter system was part of the

11
 No. 2011AP1451.dtp

plans for the pool. Id. Furthermore, because the plans for the

pool included the plans for the filter system and the contractor

used a single set of plans to construct both, the plans for the

filter system were part of the contract. Id. at 219-20. The

course of dealings in the present case demonstrates that Tufail

knew what the term "Church's Chicken" meant. He had visited

another Church's Chicken fast-food restaurant to see how Midwest

would alter the Property. This visit shows that the parties

knew and intended that Midwest would operate a fast-food

restaurant on the Property.

¶81 Tufail's interpretation of the Lease is also suspect

because it would render the inclusion of "Church's Chicken"

meaningless, and courts avoid interpreting contracts to make

portions superfluous. See DeWitt Ross & Stevens, S.C. v. Galaxy

Gaming & Racing Ltd. P'ship, 2004 WI 92, ¶44, 273 Wis. 2d 577,

682 N.W.2d 839. In DeWitt, a law firm provided services to

Galaxy under a contract that charged interest on untimely

payments, but Galaxy had no assets or income. Id., ¶7.
Galaxy's owner guaranteed full payment, but the guaranty was

silent as to whether the owner would pay interest. Id., ¶43.

It would have been meaningless to include the interest clause in

the contract with Galaxy, a company with no assets, unless the

owner's guaranty for full payment included a guaranty to pay the

interest. Id., ¶¶46-47. Similarly, it would make little sense

for the Lease to mention "Church's Chicken" four times if that

term could refer to any type of restaurant. Tufail seems to

suggest that since the Lease does not explicitly define

12
 No. 2011AP1451.dtp

"Church's Chicken," no warranty would be violated if a Church's

Chicken could open and operate under any circumstance. However,

the "Church's Chicken" term is useful only if it refers to the

Church's Chicken fast-food restaurants that actually exist.

IV

¶82 After a trial, the circuit court ruled in favor of

Tufail. In so doing, the court appears to have overlooked or

discounted critical testimony, minimized the fast-food zoning

problem to focus on the drive-through, shifted the blame to

Midwest for failing to engage in due diligence, and disregarded

an explicit provision in the Lease.

¶83 From the outset, Midwest sought to lease Tufail's

property to open and operate a Church's Chicken fast-food

restaurant. Paragraph 33(g) of the Lease was designed to

minimize the hazard of an existing zoning barrier against the

operation of a traditional Church's Chicken restaurant and to

provide an escape clause from a five-year lease if an existing

barrier unexpectedly materialized. Midwest no doubt wanted a
drive-through which is often, if not always, a component of a

fast-food restaurant. If a drive-through were the sole or major

sticking point, the specific representations in the Lease might

present a different case.

¶84 The circuit court recast the facts and narrowed the

issue. The circuit court found that "there was no evidence

presented that Tufail knew about the many other Church's Chicken

restaurants, whether or not they had drive-through operations or

other Church's Chicken franchise requirements."

13
 No. 2011AP1451.dtp

¶85 In my view, the statement about Tufail's knowledge is

clearly erroneous, and the court's emphasis on the drive-through

problem fails to deal with Midwest's legal argument that there

were two zoning problems they had to face, contrary to Tufail's

warranty.

¶86 As to his knowledge, Tufail testified that the

restaurant he bought in 2000 was a drive-through and carry-out

fast-food restaurant:

Q All right. And when you bought [the
Property], was it an ongoing restaurant?

A It was a running restaurant. It was a
chicken place.

Q What was the name of it then?

A At that time it was a New York Chicken. But
basically it was a Church's Chicken place closed down.
And the [previous owner], he bought it from Church's
Chicken and put the name—— They didn't let him use
their Church's Chicken. They—— So he put a New York
Chicken [there].
(Emphasis added.)

¶87 Tufail acknowledged that "it was an old design

Church's Chicken which [he] was running." (Emphasis added.) He

said that he used Church's Chicken equipment in his New York

Chicken and suggested that Church's Chicken use the same

equipment for its new operation. Tufail visited another

Church's Chicken in Milwaukee, and he discussed the new interior

and exterior alterations that Midwest intended to make. He

expected that Midwest would make his property look like other

Church's Chicken restaurants. He testified that the purpose of

14
 No. 2011AP1451.dtp

the Lease "as it was presented by Midwest [was] to open a new

Church's Chicken restaurant at the leased premises."

¶88 In March 2007, before the Lease was fully negotiated

and signed, Tufail was visited by Khan who oversees more than

100 Church's Chicken franchises in the Midwest. The circuit

court and the majority appear to believe that Khan and Tufail

never discussed what a Church's Chicken restaurant is all about,

so that Tufail really did not know. This view of the facts is

unrealistic if not incredible and is directly contrary to

Tufail's acknowledgment at trial that he understood Midwest

could not operate the Property without a special use permit.

¶89 In short, the court's finding that Tufail knew nothing

about other Church's Chicken restaurants cannot be squared with

the record.

¶90 The court made another questionable finding of fact.

The court found that, "[i]n early 2008, after the [New York

Chicken] restaurant had closed, Tufail was then approached by

representatives of Midwest Hospitality who sought to lease the
subject property." (Emphasis added.) Tufail's attorney, citing

the record, writes in his brief: "Midwest had approached Tufail

about opening a Church's Chicken restaurant at the location

prior to and immediately after Tufail temporarily ceased

operations of his chicken restaurant." (Emphasis added.) In

short, Tufail's attorney corrected the circuit court's findings

of fact.

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 No. 2011AP1451.dtp

¶91 The court of appeals——in its recitation of facts——

simply disregarded the circuit court's mistaken "findings" on

both matters discussed above.

¶92 As noted, the circuit court found that "there was no

evidence that Tufail knew . . . whether other Church's Chicken

restaurants had drive-through operations." It also found that

"the vast majority of Church's Chicken restaurants have drive-

through operations, but not all." (Emphasis added.) The latter

finding is correct, but it is seriously incomplete. The court

made no finding that there was any Church's Chicken restaurant

that was not a fast-food restaurant. The court also made no

finding that there was any freestanding Church's Chicken that

did not have a drive-through operation. More important for

purposes of this case is that the Property had been operated as

a freestanding fast-food restaurant and was intended by Midwest

to be operated as a freestanding Church's Chicken fast-food

restaurant. The point is that the Property's operation as a

fast-food restaurant was not allowed by the Milwaukee zoning
code without a special use permit. Tufail warranted otherwise.

¶93 Although the circuit court made sparse findings of

fact about Church's Chicken restaurants, it made lengthy

findings about Midwest's lack of due diligence. The court said:

Brian Parrish is a commercial real estate broker
who testified about industry custom and practice
relating to commercial leases. Parrish testified that
prior to entering into commercial leases parties
routinely perform due diligence and described that as
the period of time prior to the occupant taking
occupancy to uncover any issues that they may
encounter that would inhibit them from doing what they
intend to do at that property, and that includes
16
 No. 2011AP1451.dtp

government approvals, construction costs, financing,
inspections. He further testified that any issues of
import to the tenant[,] those items could have been a
contingency, a due diligence item, in the lease.
Midwest Hospitality did not perform proper due
diligence. In fact, Mr. Habash specifically testified
that Midwest Hospitality didn't do any due diligence.
He stated it was because of trust and assurances by
Mr. Tufail. But the Court does not find the testimony
of Mr. Habash about reliance on Mr. Tufail credible.
Mr. Habash is a senior executive at Midwest
Hospitality who has been involved with the lease and
renovation of many prior Church's Chicken restaurants.
Mr. Habash is the president of the independent
franchise council of over 750 such restaurants. Mr.
Habash was at the subject property before entering
into the lease and saw its poor condition. It is not
credible to believe that Mr. Habash relied upon
statements of Mr. Tufail when making the decision of
whether or not to have Midwest Hospitality enter into
the subject lease. Rather, it is more credible that
Mr. Habash relied upon his own knowledge, experience,
and personal inspection.
(Emphasis added.)

¶94 The circuit court's oral decision suggests that the

court believed that Midwest should have thoroughly investigated

all applicable zoning requirements before signing the Lease——

that Paragraph 33(g) does not mean anything because Midwest

should have previously discovered the requirements for a special

use permit. These sentiments appear to substitute the court's

expectations for the parties' intentions.

¶95 The majority opinion does not acknowledge the circuit

court's reliance on "due diligence" as a justification for not

enforcing the warranties in the Lease. This raises a very

important issue of contract law.

¶96 This court has observed that, "in general, the laws in

existence at the time of the contract are incorporated into that

17
 No. 2011AP1451.dtp

contract." Dairyland Greyhound Park, Inc. v. Doyle, 2006 WI

107, ¶60, 295 Wis. 2d 1, 719 N.W.2d 408 (citing Von Hoffman v.

City of Quincy, 71 U.S. 535, 550 n.30 (1866)). The court of

appeals has said: "It must be assumed that parties to a contract

had knowledge of the law in effect at the time of the

agreement." Krause v. Mass. Bay Ins. Co., 161 Wis. 2d 711, 718,

468 N.W.2d 755 (Ct. App. 1991) (citing Menard v. Sass, 127

Wis. 2d 397, 399, 379 N.W.2d 344 (Ct. App. 1985)).

¶97 Although these principles may be sound in general,

parties seldom have equal knowledge of the law. One party

cannot sign a contract assuring the other party that it will

have no problems under existing law and then assert a due

diligence defense when that assurance proves false. This axiom

was eloquently stated in the English case of Redgrave v. Hurd:

There is another proposition of law of very great
importance which I think it is necessary for me to
state, because, with great deference to the very
learned Judge from whom this appeal comes, I think it
is not quite accurately stated in his judgment. If a
man is induced to enter into a contract by a false
representation it is not a sufficient answer to him to
say, "If you had used due diligence you would have
found out that the statement was untrue. You had the
means afforded you of discovering its falsity, and did
not choose to avail yourself of them." I take it to
be a settled doctrine of equity, not only as regards
specific performance but also as regards rescission,
that this is not an answer unless there is such delay
as constitutes a defence under the Statute of
Limitations.
Redgrave v. Hurd, [1881] 20 Ch.D. 1 at 13 (Eng.) (first emphasis

added). One hundred years later, this ancient doctrine was

embodied in our Restatement (Second) of Contracts, § 172 (1981):

"A recipient's fault in not knowing or discovering the facts
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before making the contract does not make his reliance

unjustified unless it amounts to a failure to act in good faith

and in accordance with reasonable standards of fair dealing."

¶98 If the Supreme Court of Wisconsin intends to reject

these principles, it ought to explain why. Rejection of these

principles will certainly have implications for the enforcement

of Wis. Stat. § 100.18, which was one of Midwest's counterclaims

in this case.

¶99 One other item undermines the ruling of the circuit

court. The court looked to Paragraph 5 of the Lease and said:

"If Paragraph Five were vague or ambiguous in any way, the Court

finds that the language contained therein was drafted by Midwest

Hospitality and it should be construed against the drafter."

This is directly contrary to Paragraph 36 of the Lease, which

provides in part: "Landlord and Tenant have negotiated the terms

of this Lease; therefore, this Lease shall not be interpreted or

construed against or in favor of any party." (Emphasis added.)

¶100 In sum, the majority opinion heavily relies on the
findings of fact and conclusions of law of the circuit court and

completely rejects the well-considered decision of the court of

appeals. This is a mistake of the first order.

V

¶101 The majority opinion also relies on the "integration

clause" in the contract as precluding any consideration of parol

evidence. This too is an error because the integration clause

applies only to prior agreements. An integration clause "does

not bar the use of extrinsic evidence to clarify the meaning of

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an ambiguous text." Roth v. City of Glendale, 2000 WI 100, ¶49,

237 Wis. 2d 173, 614 N.W.2d 467 (Sykes, J., concurring) (quoting

Bidlack v. Wheelabrator Corp., 993 F.2d 603, 608 (7th Cir.

1993)); see also Restatement (Second) of Contracts § 214

(extrinsic evidence is admissible to establish the meaning of a

writing even if integrated).

¶102 If there is an integration clause, courts "may not

consider evidence of any prior or contemporaneous oral or

written agreement between the parties." Town Bank, 330

Wis. 2d 340, ¶37 (footnote omitted). In Town Bank, there was a

commitment letter before the parties signed the contract, and

the integration clause in the contract precluded consideration

of the prior commitment letter. Id., ¶41. In the present case,

there was no prior oral or written agreement regarding the

Property or the definition of "Church's Chicken." If there were

any ambiguity in the term "Church's Chicken," the integration

clause would not prevent the use of extrinsic evidence to

interpret that term in the Lease.
¶103 Even if the Lease were viewed as not specifying the

operation of a Church's Chicken fast-food restaurant, the intent

of the parties compels that interpretation. Paragraph 5 of the

Lease allows for the use of the Property to sell items

traditionally sold by any Church's Chicken. Items traditionally

sold by Church's Chicken are fast-food items, and the only

reasonable interpretation is that an establishment selling fast-

food items is a fast-food establishment. Because the court's

goal in construing a contract is to give effect to the parties'

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intent, Town Bank, 330 Wis. 2d 340, ¶33, it is reasonable to

interpret the inclusion of "Church's Chicken" to mean that

Midwest could operate a Church's Chicken fast-food restaurant.

VI

¶104 The majority opinion leans upon the fact that Midwest

ultimately attained a special use permit to operate a fast-food

restaurant with a drive-through. This does not remedy Tufail's

false warranty. The Lease warranted that there were no

ordinances or restrictions preventing the uses specified in

Paragraph 5. While Midwest obtained a one-year special use

permit, that permit did not change the fact that operating a

freestanding restaurant at the Property was not a permitted use.

The city plan examiner denied Midwest's application to operate a

Church's Chicken on the Property because the zoning code

prevented such a use. Midwest could have terminated the Lease

at that point, but it acted in good faith and worked hard to

obtain a special use permit. Unfortunately, the excessive

restrictions in the permit prevented Midwest from operating a

Church's Chicken because the restrictions made it economically

impracticable to do so.

¶105 Tufail had a permit to operate his New York Chicken

from 10:00 a.m. to 4:00 a.m.——18 hours a day, seven days a week.

Midwest received a permit that allowed it to operate until only

9:00 p.m., which likely was seven hours per day and 49 hours per

week less than Tufail had operated. If the Church's Chicken

restaurant were designed to open at 11:00 a.m., the restaurant

would operate only ten hours per day. This completely scuttled

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Midwest's business model for a restaurant located at the

intersection of North Avenue and 17th Street in Milwaukee.

¶106 Moreover, the special use permit imposed another

economic burden that prevented the operation of a Church's

Chicken. The requirement that Midwest pick up garbage within a

one-block radius of the Property was prohibitive. As the

majority points out, a Midwest representative testified that the

special use permit imposed restrictions that would have made the

operation of a Church's Chicken "impossible." Majority op.,

¶14. An economic impossibility is just as preventative as a

physical or legal impossibility. The circuit court apparently

failed to consider these insurmountable economic burdens when it

stated that the special use permit "did not prevent, in any way,

Midwest Hospitality from opening a Church's Chicken restaurant

at the subject property with a drive-through and as a fast food

restaurant." The special use permit's restrictions and

uncertainty effectively prevented the operation of the Church's

Chicken that the parties intended.

VII

¶107 When Tufail signed the Lease, he misrepresented that

there were no ordinances that would prevent any use of the

Property contemplated in Paragraph 5 of the Lease. Although the

Lease did not define "Church's Chicken," the only meaning of

that term is a fast-food restaurant. Even if "Church's Chicken"

is ambiguous, the parol evidence demonstrates that both parties

understood that a Church's Chicken is a fast-food restaurant.

Since the Milwaukee zoning code states that a freestanding fast-

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food restaurant is not a permitted use, Tufail breached his

warranty.

¶108 For the foregoing reasons, I respectfully dissent.

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