Chenequa Land Conservancy v. Village of Hartland

• Decision Date: 24 June 2004
• Docket Number: No. 03-2486.,03-2486.
• Citation: 275 Wis.2d 533,685 N.W.2d 573,2004 WI App 144
• Parties: CHENEQUA LAND CONSERVANCY, INC., Plaintiff-Respondent, v. VILLAGE OF HARTLAND, Defendant-Appellant, LUTHERAN HIGH SCHOOL ASSOCIATION OF GREATER MILWAUKEE, Defendant-Co-Appellant, Frank BUSALACCHI, Defendant.
• Court: Wisconsin Court of Appeals

275 Wis.2d 533

2004 WI App 144

685 N.W.2d 573

CHENEQUA LAND CONSERVANCY, INC., Plaintiff-Respondent, v. VILLAGE OF HARTLAND, Defendant-Appellant, LUTHERAN HIGH SCHOOL ASSOCIATION OF GREATER MILWAUKEE, Defendant-Co-Appellant, Frank BUSALACCHI, Defendant.

No. 03-2486.

Court of Appeals of Wisconsin.

Submitted on briefs March 18, 2004.

Decided June 24, 2004.

On behalf of the defendant-appellant, the cause was submitted on the briefs of Raymond J. Pollen and Amy J. Doyle, Crivello, Carlson & Mentkowski, S.C., Milwaukee.

On behalf of the defendant-co-appellant, the cause was submitted on the briefs of Jeffrey A. Schmeckpeper, Kasdorf, Lewis & Swietlik, S.C., Milwaukee.

On behalf of the plaintiff-respondent, the cause was submitted on the brief of William P. O'Connor and Mary Beth Peranteau, Wheeler, Van Sickle & Anderson, S.C., Madison.

Before Deininger, P.J., Vergeront and Lundsten, JJ.

¶ 1. VERGERONT, J.

Chenequa Land Conservancy, Inc. filed this action seeking a declaration that the conveyance of state property to the Village of Hartland was void because the conveyance violated WIS. STAT. § 84.09(5) (2001-02)¹ and a manual of the Wisconsin Department of Transportation (DOT). The Conservancy also sought an order that the property be reconveyed to the state. The circuit court granted summary judgment in favor of the Conservancy, determining that title to the property remained in the state. Hartland, along with the Lutheran High School Association of Greater Milwaukee (the Association), appeals that judgment. The dispositive issue is whether the Conservancy has standing to bring this action. We conclude it does not. We therefore reverse and remand with directions to dismiss the amended complaint.

BACKGROUND

¶ 2. The property that is the subject of this dispute consists of approximately seventy-eight acres in the Town of Merton, Waukesha County. In 2002, DOT declared this land surplus. In October 2002, both Hartland and the Village of Chenequa submitted offers to purchase. Hartland's offer was for $15,000 per acre contingent upon Hartland entering into an agreement with the Association to convey to the Association approximately sixty acres for the construction of a private high school; the remaining land was to be used for educational or recreational purposes and for public right-of-ways. Hartland's offer also provided for a connecting road to be built without public funds.

¶ 3. Chenequa offered to purchase approximately sixty-four acres for $15,500 per acre. Prior to making this offer, Chenequa entered into an agreement with the Conservancy whereby Chenequa agreed to purchase the property with the understanding that it would convey the property to the Conservancy, which proposed to maintain the property consistent with Chenequa's "open space" plan. Under the agreement, the Conservancy was to deposit funds in an escrow account equal to Chenequa's estimated acquisition costs, which Chenequa was to use to purchase the property.

¶ 4. On November 11, 2002, DOT submitted a letter report to then Governor McCallum pursuant to WIS. STAT. § 84.09(5) and (5m)² asking his approval to sell the property to Hartland in accordance with the terms of that offer. The report had a signature line for the governor to sign in approval. On November 14, Governor McCallum's facsimile signature was put on the report and the signed report was transmitted to DOT. That same day DOT notified Hartland that the governor had approved the sale and subsequently faxed a copy of the signed report to Hartland. The parties dispute whether the governor had actually approved the sale on November 14. It is not disputed, however, that on November 18 the governor's counsel wrote to DOT stating that the governor was "rescinding his approval of the Village of Hartland ... sale to review the documents."

¶ 5. When no closing had taken place by December 9, 2002, Hartland filed a petition for a writ of mandamus ordering transfer of the property. The governor's counsel was informed of this petition and also was informed of DOT's position that a valid and binding contract for sale to Hartland had been formed. The governor's chief of staff testified that the decision was made that the governor's office would not object in writing to the sale to Hartland. The petition was voluntarily dismissed based on DOT's position that it was obligated to proceed with the sale to Hartland. The sale to Hartland took place shortly thereafter, and Hartland then conveyed approximately sixty acres to the Association. ¶ 6. Chenequa's offer had been formally rejected by DOT on December 3, 2002, with DOT explaining that the additional $500 per acre of Chenequa's offer did not compensate for the cost of building the necessary connecting road, which the Hartland offer proposed to do without public funds. On January 7, 2003, a representative of the Conservancy appeared at the meeting of the board of trustees of Chenequa and asked the board to consider pursuing legal action on the sale to Hartland. The minutes show the board went into closed session to confer with legal counsel and, upon reconvening, voted to decline to authorize legal action against DOT.

¶ 7. The Conservancy initiated this suit on its own soon thereafter. The amended complaint alleged that the letter report submitted to the governor on November 11, 2002, was not a full and complete report as required by WIS. STAT. § 84.09(5) because it contained various omissions and inaccuracies, that the governor had either not actually approved or had rescinded his approval of the sale to Hartland, and that the sale violated various polices of DOT contained in its Real Estate Program Manual. The Conservancy sought a temporary injunction, a declaration that the conveyance was unlawful under § 84.09(5) and therefore void, and an order that the property be reconveyed to the state.³ ¶ 8. The circuit court issued a temporary injunction preventing the Association from beginning construction pending the resolution of this action. The court also denied the defendants' motion to dismiss based on their position that the Conservancy did not have standing to bring this action. The court concluded that it was reasonable to infer from the allegations of the complaint that the Conservancy had a particularized and substantial interest, distinct from that held by the general public, in requiring DOT to adhere to its policies in the sale of this property.

¶ 9. The Conservancy and Hartland filed cross-motions for summary judgment, with the Association joining in Hartland's motion.⁴ The circuit court granted the Conservancy's motion and denied Hartland's motion. The court concluded that the conveyance to Hartland was invalid on three independent grounds: (1) DOT's report submitted to the governor was not a "full and complete report" as required by WIS. STAT. § 84.09(3) because it did not disclose that the proposed sale was in conflict with DOT's land sale policies; (2) the governor's counsel put a facsimile of the governor's signature on the report in error and the governor did not actually approve the sale, and (3) even if the governor approved the sale, he retained the authority to rescind the sale, which he eventually did.

DISCUSSION

¶ 10. Hartland and the Association argue on appeal that the circuit court erred in concluding that the Conservancy had standing to bring this action because there was no direct injury to a legally protectible interest of the Conservancy.⁵ The Conservancy responds that it did suffer an injury by virtue of the expenditure of time and effort in negotiating the agreement with Chenequa and in helping Chenequa prepare the offer to purchase. Because of its contract with Chenequa, the Conservancy asserts, it "stands in the shoes" of Chenequa as a bidder for the property and therefore has a legally protectible interest in DOT following the requirements of WIS. STAT. § 84.09(5) and its manual on the sale of the property.⁶

¶ 11. In order to maintain an action for declaratory judgment, there must be a justiciable controversy, which exists when these requirements are met:

(1) A controversy in which a claim of right is asserted against one who has an interest in contesting it.

(2) The controversy must be between persons whose interests are adverse.

(3) The party seeking declaratory relief must have a legal interest in the controversy—that is to say, a legally protectible interest.

(4) The issue involved in the controversy must be ripe for judicial determination.

Loy v. Bunderson, 107 Wis. 2d 400, 410, 320 N.W.2d 175 (1982).

¶ 12. The third requirement is often expressed in terms of standing. City of Madison v. Town of Fitchburg, 112 Wis. 2d 224, 228, 332 N.W.2d 782 (1983). Whether a party has standing presents a question of law, which we review de novo. Lake Country Racquet & Athletic Club, Inc. v. Vill. of Hartland, 2002 WI App 301, ¶ 13, 259 Wis. 2d 107, 655 N.W.2d 189.

¶ 13. The formulation for analyzing the issue of standing has varied somewhat in the case law, in part depending on the nature of the claim asserted. The parties each use a somewhat different formulation in their arguments. We therefore begin by discussing what standard we should apply.

¶ 14. In State ex rel. First National Bank v. M&I Peoples Bank, 95 Wis. 2d 303, 308-09, 290 N.W.2d 321 (1980), where injunctive and declaratory relief was sought on the ground that a statute was unconstitutional, the court followed the approach of federal law on standing and concluded the plaintiff must have suffered some actual or threatened injury from the allegedly illegal action and there must be a logical nexus between the status of the plaintiff and the claim sought to be adjudicated.⁷ The court there did not specifically discuss standing for a declaratory judgment. However, in Madison Gen. Hosp. Ass'n v. City of Madison, 71 Wis. 2d 259, 265, 237 N.W.2d 750 (1976), the court did analyze standing for declaratory judgment actions in particular and...