G. Heileman Brewing Co., Inc. v. City of La Crosse, La Crosse County
| Decision Date | 27 October 1981 |
| Docket Number | No. 81-297,81-297 |
| Citation | 105 Wis.2d 152,312 N.W.2d 875 |
| Parties | , 25 A.L.R.4th 176 G. HEILEMAN BREWING CO., INC., a Wisconsin corporation, Plaintiff-Appellant and Cross-Respondent, v. CITY OF LA CROSSE, COUNTY OF LA CROSSE and Wisconsin Department of Revenue, Defendants-Respondents and Cross-Appellants. |
| Court | Wisconsin Court of Appeals |
Timothy Frautschi, of Foley & Lardner, Milwaukee (argued), for plaintiff-appellant and cross-respondent; Jeffrey J. Jones and Foley & Lardner Milwaukee, on brief.
John C. Murphy, Asst. Atty. Gen. (argued), for defendants-respondents and cross-appellants; Bronson C. La Follette, Atty. Gen., and John C. Murphy, Asst. Atty. Gen., on brief.
Before GARTZKE, P. J., and BABLITCH and DYKMAN, JJ.
This is an appeal by the G. Heileman Brewing Co., Inc., from an order dismissing four actions, each demanding the return of money paid for a property tax assessment. The actions pertain to the years 1974 through 1977. 1 The state cross-appeals from the portion of the trial court's order which held that the court had jurisdiction to hear Heileman's actions. We conclude that the trial court had jurisdiction and that the plaintiff's complaints did not state claims, and therefore affirm the trial court's order.
In early 1979 the G. Heileman Brewing Co., Inc. learned that the Circuit Court for Jefferson County 2 held that certain large and valuable property peculiar to the brewing industry was exempt from property tax because it was manufacturing property or specific processing equipment and not real estate. 3 Heileman owned similar property upon which it had paid property taxes from the time manufacturing property was exempted from that tax in 1974. It filed a written claim for return of the taxes in July 1979. The claims were denied, and these four suits resulted.
The dispositive issues are:
1. Were Heileman's claims properly brought in circuit court? 4
2. Are Heileman's claims barred by its failure to pay the taxes under protest or otherwise to resist their payment?
3. Are Heileman's claims barred by the doctrine of sovereign immunity?
The Department of Revenue argues on appeal 5 that the action pertaining to taxes paid in 1977 should be dismissed because the Tax Appeals Commission has exclusive jurisdiction to review whether property is exempt under sec. 70.11(27), Stats. 6 The department does not contest the trial court's determination that the circuit court had jurisdiction in this respect in the suits pertaining to the years 1974 through 1976. 7
Section 73.015(1), Stats., provides that "no person shall contest, in any action or proceeding, any matter reviewable by the (tax appeals) commission unless such person has first availed himself of a hearing before the commission under s. 73.01." The Tax Appeals Commission has exclusive initial jurisdiction for "any matter reviewable by the commission." We must therefore decide whether a claim of exemption under sec. 70.11(27), Stats., is reviewable by the Tax Appeals Commission.
Section 73.01(4)(a), Stats., provides:
Subject to the provisions for judicial review contained in s. 73.015, the (tax appeals) commission shall be the final authority for the hearing and determination of all questions of law and fact arising under sub. (5) and ss. 70.38(4)(a), 70.64, 70.995(8), 71.12, 72.86(4), 76.38(12)(a), 76.39(4)(c), 76.48(6) and 77.59(6)(b)....
Section 70.995, Stats., defines certain real estate and personal property as "manufacturing property," and provides for the assessment of that property by the Department of Revenue. Prior to the enactment of sec. 70.995 in 1973, local municipalities assessed the property defined in sec. 70.995 as "manufacturing property." Section 70.11(27) exempts some manufacturing property from assessment and taxation. Both secs. 70.995 and 70.11 (27) were created by the executive budget bill of the 1973 legislature, ch. 90, Laws of 1973.
Section 73.01(4)(a), Stats., gives exclusive initial jurisdiction to the Tax Appeals Commission of "all questions of law and fact arising under ... s. 70.995(8)." 8 Section 70.995(8)(c), Stats., is the crucial portion of sec. 70.995(8), and provides:
(c) All objections to the amount or valuation of real or personal property shall be first made in writing on a form prescribed by the department of revenue and shall be filed with the clerk of the tax appeals commission as provided in s. 73.01(5) and the rules of practice promulgated by the commission within the time prescribed in par. (b).... (Emphasis supplied.)
The parties disagree on whether "amount or valuation" encompasses a determination of whether property is exempt under sec. 70.11(27), Stats.
In Krembs v. Merrill, 183 Wis. 241, 197 N.W. 818 (1924), the court held that "amount or valuation" as provided in sec. 70.47(6), Stats. (1921), did not embrace the initial question whether the property was exempt from taxation. The court did so because the statutory powers of a board of review did not permit a board of review to Upon examining the powers of the board of review as defined by statute, it will be seen that they are limited to an examination and correction of the amount of property, of its description, of its value as found on the tax roll, and the addition thereto under certain conditions of omitted property.
make that initial determination. 9 The court said
Krembs, 183 Wis. at 245, 197 N.W. at 819.
Pelican Amusement Co. v. Pelican, 13 Wis.2d 585, 594, 109 N.W.2d 82, 87 (1961), held "In cases of illegal taxes not involving the amount of valuation of the property or excessive assessment, it is not necessary to comply with sec. 70.47(7)(a), Stats., because such section is inapplicable and is restricted to questions of amount and valuation of property."
The court did not examine the powers of the board of review as it had done in Krembs, supra, despite the substantial difference between sec. 70.47, Stats. (1921), and sec. 70.47, Stats. (1957). It accepted the term "amount or valuation" as exclusive of matters not falling within those two terms.
The court again discussed the distinction between an objection to the amount or valuation of property and objections to other aspects of taxation in Bitters v. Newbold, 51 Wis.2d 493, 187 N.W.2d 339 (1971). Though the court did not directly address the issue, it said:
Appellant had two statutory procedures open to him. He might have paid the tax as assessed and then filed a claim with the township to recover that portion which was illegally collected. If that claim were denied, he might have brought a court action to recover it, pursuant to sec. 74.73, Stats. (This, of course, accepts arguendo appellant's claim that his objections were based on grounds other than amount or valuation of property.)
Bitters, 51 Wis.2d at 512, 187 N.W.2d at 348 (footnote omitted).
By 1971 the term "amount or valuation" had become a term of art, and had a meaning that did not encompass the question whether property is exempt from taxation.
The state argues that Sawejka v. Morgan, 56 Wis.2d 70, 201 N.W.2d 528 (1972), broadly defines the jurisdiction of the Tax Appeals Commission so as to encompass the determination of property's exemption from taxation: "Sec. 73.01(4), Stats., is a broad grant of authority to the commission to hear and determine all questions of law and fact arising under the tax laws of the state, except as may be otherwise expressly designated." 10 56 Wis.2d at 75, 201 N.W.2d at 531.
Whether the present language of sec. 73.01(4), Stats., has broadened or narrowed the jurisdiction of the Tax Appeals Commission, it is apparent that sec. 70.
995(8), Stats., ultimately determines the commission's jurisdiction in manufacturing property cases. That section uses the language "amount or valuation" which had acquired a meaning long before the enactment of sec. 70.995(8) in 1973. We cannot abandon that acquired meaning. 11
Section 74.73(1), Stats., provides:
Any person aggrieved by the levy and collection of any unlawful tax assessed against him may file a claim therefor against the town, city or village which collected such tax in the manner prescribed by law for filing claims in other cases.... If any town, city or village fails or refuses to allow the claim, the claimant may have and maintain an action against the same for the recovery of all money so unlawfully levied and collected .... Every such claim shall be filed, and every action to recover any money so paid shall be brought, within one year after such payment.
Heileman did not commence these actions within one year after paying the contested taxes. However, in several cases culminating in Family Hospital Nursing Home, Inc. v. Milwaukee, 78 Wis.2d 312, 324-25, 254 N.W.2d 268, 275 (1977), the court held sec. 74.73(1), Stats., inapplicable:
This court has held that where property is found to be exempt from taxation, the taxing officers were without jurisdiction to levy the tax and therefore compliance with the statutory limitation period in which to bring the claim was not required. Trustees of Clinton Lodge v. Rock County, 224 Wis. 168, 170, 272 N.W. 5, (6) (1937). The most recent application of the rule is found in Hahn v. Walworth County, 14 Wis.2d 147, 154, 109 N.W.2d 653, (656) (1961) which, like Clinton Lodge, was an action to set aside a tax sale on the ground the property was tax exempt....
The theory for not applying the limitation period is that the tax assessment was void ab initio so there was nothing for a statute of limitation to act upon. Chicago & N. W. R. Co. v. Arnold, 114 Wis. 434, 436, 90 N.W. 434, (435) (1902); Wisconsin Real Estate Co. v. Milwaukee, 151 Wis. 198, 138 N.W. 642 (1912).
The Department of Revenue argues that even in the case of tax assessments void ab initio, the taxpayer may not recover if the taxes are voluntarily paid. It...
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