Madison General Hospital Ass'n v. City of Madison, s. 576
| Decision Date | 03 February 1976 |
| Docket Number | Nos. 576,577,s. 576 |
| Parties | MADISON GENERAL HOSPITAL ASSOCIATION, a Domestic Nonprofit Corporation, Appellant, v. CITY OF MADISON, a Municipal Corporation, Respondent, United States Leasing Corporation, a Foreign Corporation, et al., Defendants. UNITED STATES LEASING CORPORATION, a Foreign Corporation, Appellant, v. CITY OF MADISON, a Municipal Corporation, Respondent, Madison General Hospital Association, a Domestic Corporation, Defendant. (1974). |
| Court | Wisconsin Supreme Court |
Eugene O. Gehl, Timothy D. Fenner, and Axley, Brynelson, Herrick & Gehl, Madison, for appellants.
Edwin Conrad, City Atty., and Henry A. Gempeler, City Atty. Designee, Madison, for respondent.
The sole issue in the appeal of Madison General Hospital Association is whether such hospital association has standing to bring a declaratory judgment action seeking a determination that certain property leased and used by it is exempt from taxation.
So we do not reach nor seek to resolve the question of whether the leased property involved is or is not exempt from taxation. For background or frame of reference purposes only, we note that the hospital here has leased from certain companies equipment used by it in conjunction with the regular activities of the hospital. The leasing agreements provide that the hospital shall pay or reimburse the companies for all property taxes levied against the equipment leased. The city has placed the leased property on the city's tax rolls and made property tax assessments for 1972 and prior years.
The issue at time of trial, but not now, apparently will be as to the applicability to the situation of sec. 70.11 (4m), Stats., providing that property '. . . which is used exclusively for the purposes of any hospital of 10 beds or more . . .' is exempt from taxation. On this appeal we address ourselves solely to the issue of the standing of the hospital to bring this action for a declaratory judgment under sec. 269.56(2), Stats. That section of the Declaratory Judgment Act provides:
'(2) . . . Any person interested under a deed, will, written contract or other writings constituting a contract, or whose rights, status or other legal relations are affected by a statute, municipal ordinance, contract or franchise, may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract or franchise and obtain a declaration of rights, status or other legal relations thereunder. . . .'
This court has set forth four conditions precedent which must exist before a declaratory judgment action can be brought and maintained. They are as follows:
'(1) There must exist a justiciable controversy; that is to say, a controversy in which a claim of right is asserted against one who has an interest in contesting it;
'(2) the controversy must be between persons whose interests are adverse;
'(3) the party seeking declaratory relief must have a legal interest in the controversy, that is to say, a legally protectible interest; and
'(4) the issue involved in the controversy must be ripe for judicial determination.' State ex rel. La Follette v. Dammann (1936), 220 Wis. 17, 22, 264 N.W. 627, citing Borchard, Declaratory Judgments, pages 26--57.
The trial court held that the fact that the hospital was required under the lease agreements to pay or reimburse the lessors of the leased property for taxes levied on the property did not give the hospital standing to challenge the taxability of the property it leased. We see this holding and the issue in this case to relate to the third of the four listed conditions precedent, i.e., whether the hospital here has a 'legally protectible interest' in the controversy. While arguments raised on this appeal deal with others of the four conditions precedent, we hold that here the conditions as to justiciable controversy, adverse interests and ripeness for judicial determination are met, and proceed to the primary and controlling issue of whether the hospital here has a legally protectible interest in the controversy or dispute as to taxability of the property involved.
While the issue presented is one of construction of the declaratory judgment statute, which is to be 'liberally construed and administered,' (Sec. 269.56(12), Stats.), both parties direct this court's attention to the case of Ramme v. Madison (1967), 37 Wis.2d 102, 154 N.W.2d 296. There, in an action for declaratory judgment attacking the constitutionality of a mobile home parking fee statute (Sec. 66.058(3), Stats.), the plaintiff- occupant of a mobile home complained that the statute gave the right of appeal only to owners of land upon which mobile home parks are located and not to occupants of the mobile homes. The statute made the licensee of the park liable for the monthly parking permit fee as well as the owner and occupant of a mobile home in the park. (Sec. 66.058(3)(c) 1, Stats.) The Ramme holding was that there was no reason why the occupant of a trailer home cannot institute a declaratory judgment action to challenge the tax imposed. The city here relies on the statement in Ramme that to have standing to request declaratory judgment '. . . a party must be directly affected by the issues in controversy.' (Ramme v. Madison, supra, at page 116, 154 N.W.2d at page 303.) The hospital here relies on the statement in Ramme that, since the occupants of the mobile homes are 'liable' for the tax, and the tax is to be collected from them, '. . . it is reasonable to conclude that the legislature intended that they are the direct objects of the tax.' (Id. at page 111, 154 N.W.2d at page 300.) We see hospitals of ten beds or more as such 'direct objects' of sec. 70.11 (4m) in its grant of tax exemption to property 'exclusively used' by such hospitals. We do not reach or resolve the question of whether the statute grants tax exemption to leased property, not owned by the hospital but used exclusively for hospital purposes, when we hold that the hospital here, as a 'direct object' of the exemption granted, does have standing to bring an action for declaratory judgment to...
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