Beaver Dam Cmty. Hospitals, Inc. v. City of Beaver Dam, s. 2011AP1479

CourtCourt of Appeals of Wisconsin
Citation822 N.W.2d 491,344 Wis.2d 278,2012 WI App 102
Docket Number2011AP2693.,Nos. 2011AP1479,s. 2011AP1479
PartiesBEAVER DAM COMMUNITY HOSPITALS, INC., Plaintiff–Respondent, v. CITY OF BEAVER DAM, Defendant–Appellant.
Decision Date23 August 2012

344 Wis.2d 278
822 N.W.2d 491
2012 WI App 102

BEAVER DAM COMMUNITY HOSPITALS, INC., Plaintiff–Respondent,
v.
CITY OF BEAVER DAM, Defendant–Appellant.

Nos. 2011AP1479, 2011AP2693.

Court of Appeals of Wisconsin.

Submitted on Briefs April 30, 2012.
Opinion Filed Aug. 23, 2012.


[822 N.W.2d 492]


On behalf of the defendant-appellant, the cause was submitted on the briefs of Amie B. Trupke of Stafford Rosenbaum LLP, Madison.

On behalf of the plaintiff-respondent, the cause was submitted on the briefs of Kevin L. Ferguson of Hall, Render, Killian, Heath & Lyman, P.C.


A non-party brief was filed by Margaret M. Derus and Don M. Millis of Reinhart Boerner Van Deuren S.C., for Wisconsin Association of Homes & Services for the Aging, Inc., Wisconsin Hospital Association and Rural Wisconsin Health Cooperative.

Before LUNDSTEN, P.J., SHERMAN and BLANCHARD, JJ.

BLANCHARD, J.

[344 Wis.2d 281]¶ 1 This case concerns a dispute over interpretation of statutory language in a state property tax code exemption that was revised by the legislature in 2009. Respondent, Beaver Dam Community Hospitals, Inc. (the “hospital system”), asserts that its Eagle's Wings facility qualifies for the exemption as property owned and used by “a nonprofit entity that is

[822 N.W.2d 493]

operated as a facility that is licensed, certified, or registered under ch. 50” of the Wisconsin Statutes, pursuant to Wis. Stat. § 70.11(4)(a) (2009–10).1 Appellant, the City of Beaver Dam, asserts that the facility is not entitled to the exemption, based on its reading of the statute.

¶ 2 The circuit court, in two separate cases now consolidated on appeal, concluded that the exemption applies and granted summary judgment to the hospital system. The City appeals these decisions. Based on our interpretation of the statute's plain language, we agree with the circuit court that the property is exempt under the disputed provision. Accordingly, we affirm both judgments.

BACKGROUND

¶ 3 The hospital system is a federally tax-exempt nonstock, nonprofit corporation. The hospital system owns and operates the Eagle's Wings facility. There is no dispute that the facility qualifies as a community-based residential facility as defined in Wis. Stat. ch. 50 (“Chapter 50”). 2 The hospital system charges market rates for use of this facility.

[344 Wis.2d 282]¶ 4 The City of Beaver Dam assessed taxes on the real and personal property used for the facility for the 2009 and 2010 tax years. The hospital system contested the City's ability to tax these assets under the property tax code due to the exemption at issue by filing a Property Tax Exemption Request, which the City denied. The hospital system paid the 2009 taxes and then filed a Claim for Recovery of Unlawful Taxes with the City, which the City declined to grant. The hospital system then commenced an action in circuit court to recover taxes that it asserted were unlawfully assessed for the 2009 tax year. The parties went through a similar process for the 2010 tax year, producing the second legal action.

¶ 5 The hospital system argued that the property is exempt under Wis. Stat. § 70.11(4)(a), as a Chapter 50 facility owned by a nonprofit entity. In response, the City argued that the exemption applies only to facilities that show benevolent use, and that the hospital system failed to show benevolent use by its facility. The circuit court agreed with the hospital system that the exemption does not require a showing of benevolence and granted summary judgment to the hospital system in both actions. The City now appeals in both.

DISCUSSION

¶ 6 This case presents an issue of first impression involving interpretation of the current version of Wis. Stat. § 70.11(4)(a), which exempts, in relevant part:

Property owned and used exclusively by ... churches or religious, educational or benevolent associations, or by a nonprofit entity that is operated as a facility that is licensed, certified, or registered under ch. 50, including benevolent nursing homes ... but not exceeding 10 [344 Wis.2d 283]acres of land necessary for location and convenience of buildings while such property is not used for profit.

(Emphasis added.) The issue is whether § 70.11(4)(a) requires a Chapter 50 facility, here, Eagle's Wings, that is owned 3 by a

[822 N.W.2d 494]

nonprofit, here, the hospital system, to be used for benevolent activities in order to qualify for an exemption under the statute. For the following reasons, we conclude that the answer is no. As a result, we do not reach the dispute between the parties about whether the hospital system has shown that Eagle's Wings is benevolent.4


¶ 7 Issues of statutory interpretation are subject to de novo review. Martine v. Williams, 2011 WI App 68, ¶ 10, 333 Wis.2d 203, 799 N.W.2d 449. In interpreting statutes, the court's purpose is to determine what the legislature intended in drafting the statute. State v. Setagord, 211 Wis.2d 397, 406, 565 N.W.2d 506 (1997). It is assumed that the statutory language expresses the legislature's intent. [344 Wis.2d 284]State ex rel. Kalal v. Circuit Court for Dane County, 2004 WI 58, ¶ 44, 271 Wis.2d 633, 681 N.W.2d 110. If a reading of the statutory language “ ‘yields a plain, clear statutory meaning, then there is no ambiguity, and the statute is applied according to this ascertainment of its meaning.’ ” Id., ¶ 46 (citation omitted); see also Bruno v. Milwaukee County, 2003 WI 28, ¶ 22, 260 Wis.2d 633, 660 N.W.2d 656 (If the meaning of the words supports only one reasonable interpretation, the language is unambiguous.). In deciding whether a statute is ambiguous, the court construes non-technical words according to their “common and approved usage.” Wis. Stat. § 990.01(1). The fact that the parties disagree regarding the meaning of a statute does not make the statute ambiguous. Lincoln Sav. Bank, S.A. v. DOR, 215 Wis.2d 430, 441–42, 573 N.W.2d 522 (1998).

¶ 8 Although plain meaning analysis primarily focuses on the words and phrases in disputed portions of statutes, courts also consider the context represented by the entire statute. Teschendorf v. State Farm Ins. Cos., 2006 WI 89, ¶ 12, 293 Wis.2d 123, 717 N.W.2d 258. Statutory history, which involves comparison of the statute with its prior versions, is also a part of plain language analysis. Richards v. Badger Mut. Ins. Co., 2008 WI 52, ¶ 22, 309 Wis.2d 541, 749 N.W.2d 581.

¶ 9 For reasons we now explain, applying these statutory interpretation standards to the disputed statutory language, we conclude that the statute unambiguously allows an exemption for any Chapter 50 facility owned by a nonprofit entity, and therefore the exemption applies here.

¶ 10 The City does not dispute that the clause referencing Chapter 50 facilities, if read in isolation [344 Wis.2d 285]without considering the “including” clause referencing “benevolent nursing homes” that immediately follows, would mean that a nonprofit Chapter 50 facility falls within the exemption. This initial clause is part of a list of categories linked by the word “or.” SeeWis. Stat. § 70.11(4)(a) (“Property owned and used exclusively by educational institutions ...; or by churches or religious, educational or benevolent associations, or by a nonprofit entity that is operated as a facility that is licensed, certified, or registered under ch. 50 [.] ”) (emphasis added). The ordinary meaning of “or” is disjunctive,

[822 N.W.2d 495]

meaning that a category that is included in a list of categories linked by the term “or” is one alternative choice. See Hull v. State Farm Mut. Auto. Ins. Co., 222 Wis.2d 627, 638–39, 586 N.W.2d 863 (1998). It follows that, at least absent the “including” clause, all Chapter 50 facilities owned by nonprofits are eligible for the exemption at issue.

¶ 11 The dispute focuses on the significance of the “including” clause. The hospital system argues that this clause only clarifies that benevolent nursing homes are included in the exemption, and that the clause cannot be read to limit the exemption. The City argues, in contrast, that the clause could be reasonably interpreted to indicate that all Chapter 50 facilities must be “benevolent” in order to qualify for the exemption. The City does not argue that the circuit court's and hospital system's interpretation of the statute is unreasonable. Rather, the City argues that its interpretation is also reasonable. Therefore, the City argues, the exemption in the statute is ambiguous and must be construed in favor of taxation.

¶ 12 For the following reasons, we agree with the hospital system that the City's interpretation is not supported by the language of the statute and conclude [344 Wis.2d 286]that the only reasonable interpretation, consistent with the text of the statute, is that “a nonprofit entity that is operated as a facility that is licensed, certified, or registered under ch. 50” is eligible for the exemption, whether or not the facility is benevolent. SeeWis. Stat. § 70.11(4)(a).

¶ 13 The word “benevolent,” found within the clause “including benevolent nursing homes,” clearly modifies “nursing homes”; it does not modify “facility.” “Facility” appears in a separate clause within the sentence. There is nothing ambiguous in this construction. To interpret the clause referring to Chapter 50 facilities as meaning only benevolent Chapter 50 facilities, as the City does, one would expect the statute to read: “... that is operated as a benevolent facility that is licensed, certified, or registered under ch. 50....” However, instead of “... operated as a benevolent facility ...,” the statute states “operated as a facility....” The plain meaning of the initial clause at issue, “or by a nonprofit entity that is operated as a facility that is licensed, certified, or registered under ch. 50,” is that it refers to both benevolent and non-benevolent facilities.

¶ 14 In effect, the City argues that it would be reasonable to use the “including” clause as a clause of limitation or exclusion. However, our supreme court...

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