Forseth v. Sweet

• Decision Date: 07 May 1968
• Citation: 38 Wis.2d 676,158 N.W.2d 370
• Parties: Ann Van Camp FORSETH, Appellant, v. Ben L. SWEET et al., Defendants, State of Wisconsin, Respondent.
• Court: Wisconsin Supreme Court

Page 370

158 N.W.2d 370

38 Wis.2d 676

Ann Van Camp FORSETH, Appellant, v. Ben L. SWEET et al., Defendants State of Wisconsin, Respondent.

Supreme Court of Wisconsin.

May 7, 1968.

Fulton, Menn & Nehs, Appleton, Peter S. Nelson, Appleton, of counsel, for appellant.

Bronson C. La Follette, Atty. Gen., Albert Harriman, Asst. Atty. Gen., Madison, for respondent.

HEFFERNAN, Justice.

The appellant's principal argument (conceding, arguendo, the right of the state to preserve its immunity from suit) is simply that the legislature has in fact spelled out a method or procedure for suing the state. For the purpose of this argument, the appellant concedes that art. IV, sec. 27, is not self-executing, but she contends that the legislature has implemented it. That section of the constitution provides:

'The legislature shall direct by law in what manner and in what courts suits may be brought against the state.'

Appellant starts also from the premise, admittedly correct since Holytz v. City of Milwaukee (1962), 17 Wis.2d 26, 115 N.W.2d 618, that there is substantive liability imposed upon the state when its agents, in the course of their employment, commit a tort. She then points to various procedural statutes which set forth the method to be used to otain service upon the state. For example, she points to sec. 262.06(3), Stats., for the proposition that:

'A court * * * may exercise personal jurisdiction over a defendant by service of a summons as follows: * * * (3) State. Upon the state, by delivering a copy of the summons and of the complaint to the attorney general * * *.'

Sec. 270.58, Stats., ¹ she contends, completes the legislative pattern that allows suit against the sovereign. The essence of this statute is that, when a judge or jury concludes that the agent of either a municipal corporation or of the state is liable and there is a finding that the conduct was in good faith, the judgment taken against the officer or employee must be paid by his employer--whether it be a minor public subdivision or the state itself.

Appellant thus finds in the Holytz Case substantive liability; in sec. 270.58, Stats., the legislative expression of willingness for the state to be subject to the payment of damages occasioned by its agents' torts; and in the procedural statutes, a method of service. She concedes, however, that there is no statute that expressly waives the constitutional requirement of consent to suit. This deficiency she supplies by contending that to subject the state to liability without being joined in the suit is unconstitutional; and, hence, to preserve the constitutionality of the statutory scheme, the state must be considered an indispensable party, whose joinder can be compelled. We find in this argument even a kernel of solace for the state itself, for appellant contends, with evident sincerity, that the deprivation of the state's right to appear and defend would make it impossible to exercise any control over settlement negotiations and subsequent litigation.

We are not convinced that the state is substantially injured thereby, but we agree with counsel that the state is placed in an anomalous position when, by sec. 270.58, Stats., it accepts the responsibility for the results of a lawsuit against one of its agents as to attorney fees, costs, and the judgment itself; yet it has no voice in the selection of the attorney, or an opportunity to control the strategy of either a settlement or a trial. We do not accept the appellant's conclusion, however, that the awkward hiatus thus created by the legislature authorizes us to decide that the state may be sued directly in the action, but the situation thus presented does lead us to conclude that possibly there was a failure to appreciate the potential exposure to liability that was to flow from the 1965 amendment that included the state in sec. 270.58 as a backstop for any judgment that might be taken against its tortiously culpable employees.

A review of the legislative history ² of the bill indicates that at least some members of the legislature felt that no more than liability for costs and attorney fees would result from the passage of the amendment. ³ The drafting record in the legislative reference library bears the notation of the purpose of the legislation as envisaged by the draftsmen as the 'State Payments of Legal Fees Incurred by its Employees.' The 'fiscal note' attached to the 1965 amendment estimated the costs, if the bill were passed, at $10,000.00 to $15,000.00 per biennium. Apparently, not even the exposure to judgment was considered in the fiscal note. It thus seems unrealistic to conclude that the legislature by this amendment authorized suit against the state. No new exposure to substantive liability was contemplated by this statute.

Were sec. 270.58, Stats., the only legislation that dealt with the state's concern for the tortious acts of its employees, it could be argued that the purpose of that statute was to allow direct suit. We are in no such legislative vacuum. Other legislation, together with the judicial interpretation of that legislation, makes the contention of the appellant untenable.

The legislature in 1850 first enacted a procedure permitting the processing of 'claims' against the state. Chapter 249 of the laws of that year permitted a person aggrieved by the legislature's refusal 'to allow any just claim against the state, to exhibit and file * * * a bill in chancery * * * with the clerk of the supreme court * * *.'

This procedure, although modified in the course of one hundred twenty years of Wisconsin's history, remains in substance as sec. 285.01, Stats. The original statute was, in Houston v. State (1898), 98 Wis. 481, 488, 74 N.W. 111, 42 L.R.A. 39, construed to limit the right to sue the state only when the right was that of a creditor asserting a debt owed by the state. In Houston a state veterinarian had negligently tested milk cows for tuberculosis and ordered their destruction. After they were condemned and sold at a nominal price, it was discovered that the veterinarian had condemned healthy animals. Our court, however, referring to the laws of 1850, stated 98 wis. at page 487, 74 N.W. at page 113: 'This statute does not include a demand based upon the unlawful and tortious acts of officers or agents of the state.' The Houston Case rests in part upon the fact that there is no substantive liability upon the state, a position since modified in Holytz, but a careful reading of the case makes it clear that the decision was primarily based upon the failure of the legislature to provide a procedure for suit. The Houston Case concludes with these words, 98 Wis. at page 488, 74 N.W. at page 113:

'* * * this action for the alleged unlawful and tortious action of the officers and agents of the state cannot be maintained against the state, for the simple reason that the legislature has never authorized an action in this court for such misconduct.'

The legislature has acquiesced, by nonaction, in this interpretation for seventy years. It has never indicated that the court's interpretation in Houston was not consonant with the legislative intent. In view of the acceptance of the Houston Case, it would be doubtful indeed if the legislature were to reverse seventy years of consistent statutory construction disallowing a direct suit against the state by as obscure and devious a method as the appellant claims is effected by sec. 270.58, Stats. ⁴

This court has already held that the mere creation of substantive liability did not suffice to pierce the legislatively controlled barrier against suit. In Holzworth v. State (1941), 238 Wis. 63, 298 N.W. 163, it was contended that the legislature gave its consent to suit when it included the state as an 'owner' under the safe-place statute. This court then held that, though the inclusion of the state as an owner established a standard of care whose breach would be negligence, nevertheless, in the absence of a consent to sue, there could be no cause of action against the state. In so concluding, the court followed Houston, supra.

It is thus apparent that prior to Holytz there were two reasons for the state's immunity from suit: (1) the sovereign immunity of 'the king can do no wrong,' implemented by denying the doctrine of respondeat superior where an agent of the state was guilty of tortious conduct, and (2) the lack of a procedural implementation of the constitutional admonition that 'The legislature shall direct by law in what manner and in what courts suits may be brought against the state.' Holytz removed only the first barrier, since Holytz concerned only the immunity of a municipal corporation, whose liability to suit was unquestioned. The municipal immunity was not from suit but from liability for the tortious acts of its agents. The state's immunity has the additional barrier that an unconsented suit (in absence of legislative direction) is a nullity.

We conclude that Holzworth may properly be interpreted as holding that the mere labelling of the conduct of the state as negligent, thus creating some aura of substantive liability, does not in any way imply that the legislature has waived its immunity from suit or given legislative consent for an action against the state.

Appellant would analogize the right to join a municipal corporation in an action, as approved in Larson v. Lester (1951), 259 Wis. 440, 49 N.W.2d 414, and concludes that, since the state is now included in sec. 270.58, Stats., identical treatment is warranted. This argument overlooks the dual nature of the state's immunity. Since a municipal body has always been subject to suit, the entire barrier of immunity crumbled when it was concluded that there was substantive liability under sec. 270.58 as well as under Holytz. However, the state's barrier of immunity from suit is unaffected by Holytz and the statute cited by the appellant. ⁵ We thus conclude that Larson and other cases relating to...