Columbia County v. Board of Trustees of Wisconsin Retirement Fund

Decision Date29 June 1962
Citation17 Wis.2d 310,116 N.W.2d 142
PartiesCOLUMBIA COUNTY, Buffalo County, Burnett County, Portage County, Sauk County, Sawyer County, Vernon County and Waupaca County, all in the State of Wisconsin, and Carl C. Frederick, Plaintiffs, v. The BOARD OF TRUSTEES OF the WISCONSIN RETIREMENT FUND, consisting of Margaret L. Clark, James J. Dillman, Irvin F. Knoebel, Charles Kuder, Louis T. Leoni, Thomas J. Lucas, Sr., Eugene P. Macklin, Joseph J. McCormick and George F. Reinke, Defendants.
CourtWisconsin Supreme Court

Quarles, Herriott & Clemons, Special Counsel, Milwaukee, Maxwell H. Herriott and Laurence C. Hammond, Jr., Milwaukee, and David H. Bennett, Dist. Atty. for Columbia County, Portage, Pat H. Motley, Dist. Atty. for Buffalo County, Alma, Donald J. Oakey, Dist. Atty. for Burnett County, Grantsburg, John J. Haka, Dist. Atty. for Portage County, Stevens Point, James R. Seering, Dist. Atty. for Sauk County, Baraboo, Terence N. Hickey, Dist. Atty. for Sawyer County, Hayward, Larry A. Sieger, Dist. Atty. for Vernon County, Viroqua, Edward R. Macklin, Dist. Atty. for Waupaca County, New London, of counsel, for petitioners.

John W. Reynolds, Atty. Gen., and J. R. Wedlake, Asst. Atty. Gen., Madison, for respondents.

Julian Bradbury, Madison, John J. Fleming, City Atty., and Harry G. Slater, Deputy City Atty., Milwaukee, Lawton & Cates, Madison, amici curiae.

HALLOWS, Justice.

Standing on the threshold of the constitutional issues is the question whether the plaintiffs have the legal capacity to sue and the right to contest the constitutionality of Ch. 459, Laws of 1961. No doubt, counties and a taxpayer have the capacity to bring a suit for declaratory relief under sec. 269.56, Stats. Subsec. 13 thereof expressly so provides, and sec. 59.07, Stats., authorizes a county to commence and maintain an action to protect its interests. However, neither section abrogates the traditional rule that a county does not have the legal right or status as against the state or another state agency to contest the constitutionality of a statute. Upon the reasoning a city was a municipal corporation and a metropolitan sewerage district was a quasi municipal corporation, both being political subdivisions of the state created as convenient agencies for the exercising of such governmental powers of the state as may be entrusted to them and as such were creatures of the legislature and an arm of the state, we held in Madison Metropolitan Sewerage Dist. v. Committee on Water Pollution (1951), 260 Wis. 229, 50 N.W.2d 424, that the city of Madison and the Metropolitan Sewerage District did not have any standing to contest the constitutionality of the state law there in question. While there is a distinction between a county and a village or city and the former is generally classified as a quasi municipal corporation rather than a municipal corporation, State ex rel. Bare v. Schinz (1927), 194 Wis. 397, 216 N.W. 509, the distinction is not material in this case.

A county as a quasi municipal corporation and as an arm of the state has no right to question the constitutionality of the acts of its superior and creator or of another arm or governmental agency of the state. A county or a governmental agency is created almost exclusively in the view of the policy of the state at large for purposes of political organization and civil administration in matters of state concern. McQuillin, Municipal Corporations, Vol. 1, sec. 112; Young v. Juneau County (1927), 192 Wis. 646, 212 N.W. 295. In two recent cases 1 we have made an exception to the general rule after stating it as follows:

'State agencies or public officers cannot question the constitutionality of a statute unless it is their official duty to do so or they will be personally affected if they fail to do so and the statute is held invalid.'

In Fulton, we allowed the department of taxation, in the tax case brought by a private taxpayer, to raise in defense the question of constitutionality on the ground of an exceptional situation involving issues of great public concern. Likewise, in Associated Hospital Service, Inc. v. Milwaukee (1961), 13 Wis.2d 447, 109 N.W.2d 271, under the same reasoning, we allowed the city of Milwaukee to raise the question of constitutionality in a tax case brought by a taxpayer. It will be noted in both these cases, neither the city nor the state agency was suing the state of Wisconsin or another state agency. We are not disposed to extend the exception to the general rule to cover suits between two agencies of the state government or between an arm of the government and the state itself. Nor does this case involve any official duty of the county to raise the question of constitutionality or any personal liability if it fails to do so and the statute is held invalid.

In Madison Metropolitan Sewerage Dist. v. Committee on Water Pollution, supra, we also stated the taxpayer had no standing to sue because he had no other or higher right than that which the district or municipality itself could claim and his action was derivative in nature. However, the Madison Metropolitan Case is not controlling of the taxpayer's rights in this case. In essence, Ch. 459, Laws of 1961, is concerned with the operation and administration of a county as a political subdivision of the state. The county, in such capacity, does not represent the taxpayers, as we said a city might act in the Associated Hospital Case.

The injury to the individual taxpayer in this suit is distinct from the injury complained of or alleged by the county. If the taxpayer was attempting to protect the same interests which the county was attempting to protect if it could sue, the taxpayer's suit would be derivative. But here, the taxpayer alleged in his complaint a direct pecuniary loss to him as a taxpayer of the state of Wisconsin and to other taxpayers similarly situated. This allegation was admitted by the demurrer and meets the requirements of the taxpayer's action for his own injury as declared in S. D. Realty Co. v. Sewerage Comm. of City of Milwaukee (1961), 15 Wis.2d 15, 112 N.W.2d 177.

Unless an individual taxpayer can ground an action for an injury to himself and raise the question of unconstitutionality of the laws so affecting him, the legislature could with impunity violate the constitutional limitations of its powers by enacting statutes affecting counties and the taxpayers thereof and be free from challenge in the state courts, leaving only a taxpayer to sue in the federal courts in those instances where such violation of the state constitution also violated the rights guaranteed by the federal constitution and the taxpayer can meet the other federal requirements for such a suit. The state's legislative control of municipalities, like other state power, is not entirely beyond the scope of some limitations imposed by the U. S. Constitution. Gomillion v. Lightfoot (1960), 364 U.S. 339, 81 S.Ct. 125, 5 L.Ed.2d 110. The authority of the legislature over a municipal corporation, while supreme, is subject to such limitations as may be prescribed by the state constitution. State ex rel. Martin v. Juneau (1941), 238 Wis. 564, 300 N.W. 187. State ex rel. Zilisch v. Auer (1928), 197 Wis. 284, 221 N.W. 860, 223 N.W. 123.

We hold that while the counties cannot raise the issue of unconstitutionality against another agency of the state, the individual taxpayer and resident of one of the counties affected in his individual capacity by Ch. 459, Laws of 1961, has the capacity to bring this suit and the right to raise the constitutional issue on behalf of himself and the other taxpayers.

Constitutional Issues

The plaintiffs raise many constitutional issues which will be discussed seriatim. On at least two prior occasions, this court has declared the subject of pensions for certain public employees is a matter of state-wide concern. 2 While pensions for teachers, policemen and firemen raise more dramatically the concern of the public, nevertheless pensions for other county employees are of real and abiding interest of the state because of the local execution of its laws and policies by counties. It may be true, the state has lagged behind that of private industry, in providing pensions but the merits, necessity and purposes of pensions for employees are generally accepted both by employers and employees in and out of government service as part of our way of life. To maintain a high caliber of personnel in government service, governments and units thereof must compete with private industry. In so competing, one method is to offer attractive retirement plans. The establishment of state-wide benefits for county personnel is a matter of state-wide concern. By 1961, 43 counties had voluntarily come under the state pension system but 26 counties, including the plaintiffs, had not kept pace with the times. Ch. 459, Laws of 1961, mandatorily included these counties in the Fund. The basic issue in this case stems from the fact the plaintiff counties, as arms of the state government, object to the compulsion of the state by virtue of this law to provide pensions for their employees. This, we have held, they had no status to do.

Chapter 459, Laws of 1961, is a public law.

The plaintiff taxpayer contends Ch. 459, Laws of 1961, is a local law and embraces three subjects, one of which is not expressed in the title and thereby violates Art. IV, sec. 18 of the Wisconsin constitution. 3 The constitution does not define a private or local bill but the plaintiff contends a bill is local when it affects only a specific locality or only a portion of the state except when the portion of the state affected constitutes a legitimate legislative class, relying on Milwaukee County v. Isenring (1901), 109 Wis. 9, 85 N.W. 131, 53 L.R.A. 635; and Whitefish Bay v. Milwaukee County (1937), 224 Wis. 373, 271 N.W. 416. The provisions of the constitution are not applicable to a...

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