Hilton v. Department of Natural Resources, 2003AP3353.

CourtUnited States State Supreme Court of Wisconsin
Citation2006 WI 84,717 N.W.2d 166
Docket NumberNo. 2003AP3353.,2003AP3353.
PartiesJim HILTON, Acting on Behalf of PAGES HOMEOWNERS' ASSOCIATION, Plaintiff-Respondent-Petitioner, v. DEPARTMENT OF NATURAL RESOURCES, Defendant-Appellant.
Decision Date06 July 2006

Appeal from the Circuit Court, Green Lake County, William M. McMonigal, J.


For the plaintiff-respondent-petitioner there were briefs by Peter John Hoeper and Hoeper Law Offices, Waupun, and oral argument by Peter John Hoeper.

For the defendant-appellant the cause was argued by Joanne F. Kloppenburg, Assistant Attorney General, with whom on the briefs was Peggy A. Lautenschlager, Attorney General.

An amicus curiae brief was filed by John A. Kassner and Murphy Desmond S.C., Madison, on behalf of the Wisconsin Builders Association, and there was oral argument by John A. Kassner.

An amicus curiae brief was filed by Thomas D. Larson and Debra P. Conrad, Madison, on behalf of the Wisconsin Realtors Association.

An amicus curiae brief was filed by William P. O'Connor, Mary Beth Peranteau and Wheeler, Van Sickle & Anderson, S.C., Madison, on behalf of the Wisconsin Association of Lakes.


Jim Hilton, acting on behalf of the Pages Homeowners' Association (Association) appeals an unpublished decision of the court of appeals, reversing the decision of the circuit court which had modified the order of the Administrative Law Judge (ALJ)1 requiring that the Association reduce the number of boat slips on its pier. There are three principal issues on appeal: What standard of review must a court apply to an ALJ decision that has been expressly adopted by the Department of Natural Resources (DNR) on a matter in that agency's particular area of expertise? Whether the decision of the DNR, adopting that of the ALJ, that a 226-foot, 11-slip pier is the most that "reasonable use" allows, is reasonable, consistent with applicable law, and supported by substantial evidence in the record? Finally, if the DNR decision2 that the Association must reduce the number of slips from its current 22 to 11 is valid, whether the enforcement of that determination would constitute a taking of private property for public use under the state3 and federal4 constitutions, and therefore require the state to pay just compensation?

¶ 2 We affirm the decision of the court of appeals. We hold that because the DNR did not appeal the decision of the ALJ, and adopted by rule the decision as its own, the decision is entitled to great weight deference, because it is a decision within the DNR's area of expertise and satisfies the other necessary criteria. Furthermore, the decision of the DNR was reasonable, consistent with applicable law, and supported by substantial evidence in the record. The decision of the DNR was neither arbitrary nor capricious. Finally, because the issue of whether the reduction in the number of boat slips allowed on the Association pier is an unconstitutional taking is not properly before this court, we decline to address it.


¶ 3 The relevant facts are not in dispute. Nelson Page (Page) owned a 77-foot wide riparian lot on Green Lake, as well as nearby nonriparian land. In 1958 and again in 1961, Page subdivided, platted, and recorded the nonriparian land, developed a subdivision, and sold the lots. At the same time, Page also conveyed various undivided 1/38 interests in the riparian lot and a common pier to those buyers who purchased and built on the nonriparian land. The Association, an unincorporated entity, was established in 1966. Association membership consists of those persons who each own the 1/38 interest in the riparian lot.

¶ 4 Since 1966, the Association has placed an unpermitted pier, with various numbers of boat slips, extending from the riparian lot into Green Lake. In 1966, the pier had six boat slips. In 1974-76, the number of slips increased to 11. In 1990, the number of slips had increased to 20. The slips decreased to 16 in 1994-95 then rose to 21 by 2000. Currently, the pier is 249 feet long, 3 feet wide, and contains 22 boat slips. In 1993, when Green Lake County adopted an antipyramiding ordinance there were 17 slips on the pier.5

¶ 5 The Association first contacted the DNR regarding its pier in 1993, at which point Association representatives were told that although the pier's size and density were both excessive under DNR "reasonable use" guidance, the DNR would not commence an enforcement action unless a complaint was received.

¶ 6 In 1997, the DNR received a complaint about possible riparian zone conflicts involving the Association's pier. When the conservation warden inspected the site, an Association member informed him that the Association was interested in increasing the number of slips on the pier above the existing 22.6 The warden explained that the Association would need a permit to do so, and that the DNR would consider reasonable use, cumulative impact, and other public interest factors in deciding whether to issue a permit.

¶ 7 In 1998, the Association asked the DNR if it needed a permit to replace its existing pier with two piers containing 14 slips each. In response to that proposal, and repeatedly over the next four years, DNR staff advised the Association of the DNR's position: that the existing pier and any proposed expansion exceeded Wis. Stat. § 30.13 (1997-98) standards to maintain a pier without a permit; that the Association must apply for a permit if it wished to maintain the current pier or any pier exceeding the § 30.13 (1997-98) standards; if the Association did not reduce the pier to meet the standards, or submit a permit application, the DNR would seek an abatement hearing under § 30.03 (1997-98).7

¶ 8 In 1998 and in 2000, the DNR received further complaints about the pier. By June 2001, having still not received a pier permit application, pursuant to its enforcement powers under Wis. Stat. § 30.03 (2001-02),8 the DNR requested an abatement hearing. Going into the abatement hearing, it was the DNR's recommendation that six slips represented the "reasonable use" that the Association pier could legally maintain without a permit.

¶ 9 In May 2002, all Association members but one submitted an application for a pier permit. The abstaining member opposed the application. Because the Association is an unincorporated entity, it does not have the authority to act on behalf of its members unless the members are unanimous. The DNR's policy is that it does not have a complete application for which it can grant a permit unless all owners apply.

¶ 10 The abatement hearing began on August 27, 2002, and testimony ensued for three days. Administrative Law Judge Jeffrey D. Boldt issued his decision in the abatement action on November 22, 2002, and determined that the existing pier violated public rights in exceeding the "reasonable use" threshold, negatively impacted the aquatic habitat, and created a safety hazard. After considering both the rights of riparians and the rights of the public, ALJ Boldt determined that the Association should be limited to a 226-foot pier with no more than 11 slips. Eleven slips also happened to be the number he had concluded represented the "historic use" of the pier.

¶ 11 On December 17, 2002, the Association petitioned for judicial review in the circuit court of the DNR decision. The circuit court found that the DNR's determination of the historic use of the pier at 11 slips was arbitrary, without rational basis, and without sufficient basis in the record. The circuit court determined that a better historic use date was 1993, when the antipyramiding ordinance went into effect. At that time there were 17 slips on the pier. Therefore, the circuit court set the number of allowable slips at 17. The DNR appealed.

¶ 12 The court of appeals reversed the circuit court. In an order dated August 18, 2004, the court of appeals determined that the circuit court had applied an improper standard of review and substituted its judgment for the decision adopted by the DNR. The court of appeals, therefore, reinstated that determination. The Association appealed, and this court granted its petition for review.


¶ 13 The parties disagree as to the appropriate standard of review a court should apply to an ALJ determination that has been expressly adopted by the DNR. The Association suggests that the determinations of the ALJ should be reviewed de novo, because the DNR failed to employ its expertise in evaluating the ALJ decision. The DNR maintains that the decision is entitled to great weight deference. We agree with the DNR.

¶ 14 In this case, we review the ALJ's determination as a decision of the DNR. See Borsellino v. DNR, 2000 WI App 27, ¶ 5, 232 Wis.2d 430, 606 N.W.2d 255 (citing Sea View Estates Beach Club, Inc. v. DNR, 223 Wis.2d 138, 146-47, 588 N.W.2d 667 (Ct.App.1998)). We do so because "the DNR did not petition for judicial review of the ALJ's decision, and adopted the decision as its own pursuant to § 227.46(3)(a) Stats.,9 and Wis. Adm.Code § NR 2.155(1)." Borsellino, 232 Wis.2d 430, ¶ 5, 606 N.W.2d 255 (footnote omitted). Wisconsin Admin. Code § NR 2.155(1) provides, in pertinent part, "The administrative law judge shall prepare findings of fact, conclusions of law and decision subsequent to each contested case heard. Unless the department petitions for judicial review as provided in § 227.46(8), Stats., the decision shall be the final decision of the department. . . ." Wis. Admin. Code § NR 2.155(1) (Sept., 1986). In this case the DNR chose not to appeal the ALJ's decision, "thereby making the ALJ decision its own under its own rule." Sea View, 223 Wis.2d at 147, 588 N.W.2d 667. Therefore, because the DNR has expressly adopted the ALJ decision, the ALJ decision should be afforded the same deference afforded the agency. Id. at 146-47, 588 N.W.2d 667.

¶ 15 When an appeal is taken from a circuit court order reviewing an agency...

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