Lamar Cent. Outdoor, LLC v. Wis. Div. of Hearing & Appeals

• Decision Date: 29 November 2018
• Docket Number: Appeal No. 2017AP1823
• Citation: 385 Wis.2d 211,923 N.W.2d 168 (Table),2019 WI App 1
• Parties: LAMAR CENTRAL OUTDOOR, LLC d/b/a Lamar Advertising of Central Wisconsin and TLC Properties, Inc., Petitioners-Appellants, v. State of Wisconsin DIVISION OF HEARING & APPEALS, Respondent-Respondent, State of Wisconsin Department of Transportation, Other Party.
• Court: Wisconsin Court of Appeals

385 Wis.2d 211

923 N.W.2d 168 (Table)

2019 WI App 1

LAMAR CENTRAL OUTDOOR, LLC d/b/a Lamar Advertising of Central Wisconsin and TLC Properties, Inc., Petitioners-Appellants,

v. State of Wisconsin DIVISION OF HEARING & APPEALS, Respondent-Respondent,State of Wisconsin Department of Transportation, Other Party.

Appeal No. 2017AP1823

Court of Appeals of Wisconsin.

DATED AND FILED November 29, 2018

FITZPATRICK, J.

¶1 In 1999, Lamar Central Outdoor, LLC acquired an outdoor advertising sign that is located adjacent to an interstate highway. At that time, the sign was legal but nonconforming under Wisconsin law. Several years after acquiring the sign, Lamar put extension panels on the sign which added to the previous area of signage. In 2012, the Wisconsin Department of Transportation determined that the entire sign must be removed because Lamar's enlargement of the sign caused it to lose its nonconforming status and become an illegal sign subject to removal. After a contested case hearing, the Division of Hearings and Appeals (DHA) affirmed the Department's order to remove the sign. The Portage County Circuit Court affirmed the DHA decision, and Lamar appeals. We agree with the Department that the sign is illegal under Wisconsin law and affirm the order to remove the sign.

BACKGROUND

¶2 There is no dispute as to the following facts.

¶3 The sign in dispute was erected in 1991, pursuant to a permit from the Department, adjacent to what was then U.S. Highway 51 in the City of Stevens Point. At that time, the sign conformed to the requirements of WIS. STAT. § 84.30 (2015-16),¹ which regulates outdoor advertising signs in Wisconsin. When it was constructed, the sign measured 14 feet by 48 feet on each face in accordance with its originally permitted size of 1,344 square feet. In January 1996, the portion of Highway 51 adjacent to the sign became part of the interstate highway system, and the highway was designated Interstate 39. As will be explained in detail in the Discussion below, because of that change, the sign became legal but nonconforming under § 84.30.² Lamar acquired the sign in 1999.

¶4 In 2012, Lamar applied to the Department for a permit to remove vegetation obstructing the sign. While considering that application, the Department reviewed a photograph taken in 2008 showing that an extension had been added to the top of the sign, and that lead to further investigation by the Department. The Department alleges that, starting in 2007, Lamar added extension panels of various sizes and shapes to the sign. According to the Department, these extensions significantly increased the previous size of the sign.

¶5 The Department took the position that, by adding the extensions, Lamar enlarged the area of the sign in violation of WIS. ADMIN. CODE § TRANS 201.10(2)(e) (Feb. 2013) (providing that "[i]n order to lawfully maintain and continue a nonconforming sign ... [t]he sign ... may not be enlarged.").³ According to the Department, when Lamar placed extensions on the sign, it failed to lawfully maintain and continue the sign, causing the sign to lose its nonconforming status and become an illegal sign subject to a removal order. WIS. ADMIN. CODE § TRANS 201.09 ("[A]ny nonconforming sign which subsequently violates s. 84.30, Stats., or these rules, shall be subject to removal as an illegal sign.").

¶6 In August 2012, the Department denied Lamar's application for a vegetation cutting permit on the basis that the sign had been enlarged. The Department issued a sign removal order to Lamar in September 2012. The extensions were removed by Lamar before the Department issued the removal order, so the sign again measured 14 feet by 48 feet at the time the removal order was issued.

¶7 In September 2012, Lamar requested contested case hearings to review the vegetation cutting permit and the removal order. After a hearing, the DHA concluded that Lamar enlarged the sign, causing the sign to become illegal and lose its nonconforming status under Wisconsin law. As a result, the DHA issued a final decision affirming the removal order and the denial of the vegetation cutting permit.

¶8 Pursuant to WIS. STAT. ch. 227, Lamar petitioned for judicial review of the DHA's decision. The circuit court affirmed the DHA's decision, and Lamar now appeals.

¶9 We will refer to other material facts in the following Discussion.

DISCUSSION

¶10 Lamar contends that the DHA decision contains various errors. First, Lamar argues that the evidence was insufficient to prove that the sign was enlarged beyond its allowed size. Second, Lamar asserts that Wisconsin law does not prohibit enlarging the sign. Third, Lamar contends that, even if Wisconsin law prohibits enlarging the sign, it has a statutory right to cure the violation. Fourth, Lamar claims that the Department was required to engage in formal rulemaking prior to enforcing administrative regulations regarding the sign. Finally, Lamar argues that, under the common law of nonconforming uses, it had the right to enlarge the sign. We address, and reject, each of Lamar's arguments in turn.⁴

I. Standard of Review and Interpretation of Statutes and Administrative Rules.

¶11 In an appeal of a circuit court order reviewing an agency decision, we review the decision of the agency, not that of the circuit court. Hilton ex rel. Pages Homeowners' Ass'n v. DNR , 2006 WI 84, ¶15, 293 Wis. 2d 1, 717 N.W.2d 166. When reviewing findings of fact made by the DHA, we apply the "substantial evidence" standard. Id. , ¶16; WIS. STAT. § 227.57(6). That standard requires us to ask whether, after considering all the evidence in the record, reasonable minds could arrive at the same conclusion and, if so, we must affirm the DHA findings. Hilton , 293 Wis. 2d 1, ¶16. We accord no deference to the DHA's interpretations of law and review de novo questions of statutory and regulation interpretation. See § 227.57(11) (no deference where agency action or decision restricts property owner's free use of property); see also Tetra Tech EC, Inc. v. DOR , 2018 WI 75, ¶108, 382 Wis. 2d 496, 914 N.W.2d 21 ("We have also decided to end our practice of deferring to administrative agencies' conclusions of law.").

¶12 The questions before us require the interpretation of statutes and administrative rules. "[W]hen interpreting administrative regulations, we use the same rules of interpretation as we apply to statutes." DaimlerChrysler v. LIRC , 2007 WI 15, ¶10, 299 Wis. 2d 1, 727 N.W.2d 311.

¶13 "[S]tatutory interpretation ‘begins with the language of the statute. If the meaning of the statute is plain, we ordinarily stop the inquiry.’ " State ex rel. Kalal v. Circuit Court for Dane Cty. , 2004 WI 58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110 (quoting Seider v. O'Connell , 2000 WI 76, ¶43, 236 Wis. 2d 211, 612 N.W.2d 659 ). Nonetheless, "scope, context, and purpose are perfectly relevant" to an interpretation of a statute as long as "the scope, context, and purpose are ascertainable from the text and structure of the statute itself." Id. , ¶48. More specifically, we interpret the language of a statute or rule "in the context in which it is used; not in isolation but as part of a whole; in relation to the language of surrounding or closely-related statutes; and reasonably, to avoid absurd or unreasonable results." Id. , ¶46.

¶14 In a similar vein, "[w]hen an administrative agency promulgates regulations pursuant to a power delegated by the legislature, we construe those regulations ‘together with the statute to make, if possible, an effectual piece of legislation in harmony with common sense and sound reason.’ " DaimlerChrysler , 299 Wis. 2d 1, ¶10 (quoting State v. Busch , 217 Wis. 2d 429, 441, 576 N.W.2d 904 (1998) ).

¶15 We consider, first, whether there is substantial evidence in the record to support the DHA's finding that Lamar enlarged the sign.

II. The Record Contains Substantial Evidence That Lamar Enlarged The Sign.

¶16 As mentioned, under WIS. ADMIN. CODE §§ TRANS 201.09 and 201.10(2)(e), enlarging a nonconforming sign causes the sign to lose its lawful nonconforming status, and the sign becomes an illegal sign subject to removal. In its decision, the DHA found that "Lamar used extensions of varying sizes and shapes on the subject sign at different times." More specifically, on the basis of photographic evidence and Lamar's discovery responses, the DHA found that Lamar first placed extensions on the sign starting in 2007. The DHA also found that, at the time the Department issued the removal order in September 2012, the sign had been restored to its legally permitted size of 14 feet by 48 feet.

¶17 Lamar does not deny that it placed extensions on the sign. Rather, Lamar argues that the Department failed to meet its burden of establishing that Lamar enlarged the sign beyond its permitted size and failed to prove the size of the sign when it became nonconforming in 1996. See WIS. ADMIN. CODE § HA 1.12(3)(a) (Dec. 2002) (the burden of proof is on the Department to support its factual assertions). Put another way, Lamar asserts that the Department was required to prove the precise dimensions of the sign when it became nonconforming in 1996 and then establish that the sign was enlarged after that date. We will assume, without deciding, that Lamar has correctly summarized what the Department was required to prove, but, at any rate, we reject Lamar's argument because it neglects the applicable standard of review and the evidence in the record.

¶18 The substantial evidence standard requires that we affirm the agency's findings of fact if the record contains evidence from which reasonable minds could arrive at the same conclusion. Hilton , 293 Wis. 2d 1, ¶16 ; WIS. STAT. § 227.57(6). We conclude that, based on the evidence in the record, the DHA reasonably concluded that Lamar's use of extensions on the sign enlarged it beyond its legally permitted size starting in 2007. That evidence is summarized as follows:

• The original permit, issued in 1991, was for a two-sided

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