State ex rel. Bldg. Owners & Managers Ass'n of Milwaukee, Inc. v. Adamany, Nos. S

CourtUnited States State Supreme Court of Wisconsin
Writing for the CourtHEFFERNAN; White; Black; He also emphasized that Blaisdell was based upon a legislative declaration of an emergency of catastrophic proportions. In his dissent
Citation219 N.W.2d 274,64 Wis.2d 280
PartiesSTATE ex rel. BUILDING OWNERS & MANAGERS ASSN. OF MILWAUKEE, INC., et al., Petitioners, v. David W. ADAMANY, Secretary of the Wisconsin Department of Revenue, Respondent. STATE ex rel. K. C. CORP., a Wisconsin corp., Petitioner, v. Joe E. NUSBAUM, Secretary of the Wisconsin Department of Administration, Respondent. STATE ex rel. C. B. CARPENTER et al., Petitioners, v. Joe E. NUSBAUM, Secretary of the Wisconsin Department of Administration, Respondent. STATE ex rel. S. & L. REALTY INVESTMENT CO., a Wisconsin corp., Petitioner, v. Joe E. NUSBAUM, Secretary of the Wisconsin Department of Administration, Respondent. tate 256--259.
Docket NumberNos. S
Decision Date28 June 1974

Page 274

219 N.W.2d 274
64 Wis.2d 280
STATE ex rel. BUILDING OWNERS & MANAGERS ASSN. OF MILWAUKEE,
INC., et al., Petitioners,
v.
David W. ADAMANY, Secretary of the Wisconsin Department of
Revenue, Respondent.
STATE ex rel. K. C. CORP., a Wisconsin corp., Petitioner,
v.
Joe E. NUSBAUM, Secretary of the Wisconsin Department of
Administration, Respondent.
STATE ex rel. C. B. CARPENTER et al., Petitioners,
v.
Joe E. NUSBAUM, Secretary of the Wisconsin Department of
Administration, Respondent.
STATE ex rel. S. & L. REALTY INVESTMENT CO., a Wisconsin
corp., Petitioner,
v.
Joe E. NUSBAUM, Secretary of the Wisconsin Department of
Administration, Respondent.
Nos. State 256--259.
Supreme Court of Wisconsin.
June 28, 1974.
Rehearing Denied Sept. 4, 1974.

Foley & Lardner, Milwaukee, for petitioners.

[64 Wis.2d 285] Percy L. Julian, Jr., Madison, for respondents.

Patricia D. McMahon and Louis J. Mestre, Milwaukee Legal Services, Inc., Milwaukee, amicus curiae on behalf of Milwaukee Tenants Union and East Side Housing Action Coalition.

HEFFERNAN, Justice.

The plaintiffs are faced with a strong presumption that the law is constitutional. That presumption was explained in State ex rel. Hammermill Paper Co. v. La Plante (1973), 58 Wis.2d 32, 47, 205 N.W.2d 784, 793, quoting from Gottlieb v. Milwaukee (1967), 33 Wis.2d 408, 415, 416, 147 N.W.2d 633, 637:

"On the other hand, it is a legislative enactment that is attacked as being unconstitutional, and the cardinal rule of statutory construction is to preserve a statute and to find it constitutional if it is at all possible to do so. We have recently said:

"'. . . the duty of this court is . . . if possible, to so construe the statute as to find it in harmony with accepted constitutional principles.' State ex rel. Harvey v. Morgan (1966), 30 Wis.2d 1, 13, 139 N.W.2d 585, 590.

"All legislative acts are presumed constitutional, and every presumption must be indulged to sustain the law if at all possible. State ex rel. McCormack v. Foley (1962), 18 Wis.2d 274, 279, 118 N.W.2d 211; School Dist. v. Marine Nat. Exchange Bank (1960), 9 Wis.2d 400, 403, 101 N.W.2d 112. If any doubt exists it must be resolved in favor of the constitutionality of a statute. State ex rel. Thomson v. Giessel (1953), 265 Wis. 558, 564, 61 N.W.2d 903. We as a court are not concerned with the merits of the legislation under attack. We are not concerned with the wisdom of what the legislature has done. We are judicially concerned only when the statute clearly contravenes some constitutional provision. Chicago & N.W.R. Co. v. La Follette (1965), 27 Wis.2d 505, 521, 135 N.W.2d 269."

[64 Wis.2d 286] To overcome this presumption, the plaintiffs must prove the law to be unconstitutional beyond a reasonable doubt. Hammermill, supra, p. 46, 205 N.W.2d 784.

The plaintiffs attack the statute on almost every conceivable front. They claim it serves no public purpose, that it is a tax law, and, as such, is void as being in violation of the uniformity clause, art. VIII, sec. 1, of the Wisconsin Constitution; that it classifies both landlords and tenants in an unreasonable and arbitrary fashion and, hence, denies equal protection of the law; that the statute is vague and indefinite and violates due process; that it violates both the state and federal constitutions by mandating the impairment of contracts; and that the taking of property without due process of law is permitted by sec. 539.

If we conclude, for any reason, that the statute is unconstitutional, the case is resolved, and we need not discuss any other issues raised.

The initial board attack upon the statute is that it serves no public purpose. Both the attack and the defense of the statute are somewhat puzzling, since neither side defines what is meant by public purpose. The plaintiffs appear to be arguing that the statute infringes upon certain rights guaranteed by the constitution against encroachments by either the state or national government, and that such encroachments can only be justified by the statute serving an articulated public purpose of great moment. Plaintiffs appear to argue that no pressing necessity in the public interest has been spelled out to justify the police power infringement upon a constitutional right. Their argument, however, is vague.

Page 278

The defendants' response poses at least equal perplexities. While we sympathize with the defendants' bewilderment with the plaintiffs' discussion of public purpose, we are equally at a loss to understand defendants' response.

[64 Wis.2d 287] They argue that the statute complies with the public purpose doctrine and is, therefore, constitutional. However, the public purpose doctrine on which they rely seems to have no relevance to this case. Defendants correctly state the doctrine--public funds may only be spent for public purposes--and argue, apparently, that, in conformance with that doctrine, sec. 539 authorizes the expenditure of funds for a proper public purpose. We say, 'apparently,' because their rationale is not spelled out. The defendants' assumption appears to be that the dollar amount of taxes that could have been levied by the state or other tax units would have been public funds if collected. Since they were not collected, such sums constituted a windfall to lessors that was government money--its public funds to disburse as it saw fit so long as the recipients of this largesse were a class (tenants) to whom government funds could properly go. Perhaps we misstate the defendants' position, but if we do, we see no relevancy whatsoever to their argument. Their position rests upon the doubtful logic that what the government did not take in taxes is nevertheless the government's to appropriate as it sees fit for any purpose that is public.

This premise is dubious. It would have some germ of relevance if is were apparent that the reduction of taxes was in all cases the result of shared revenues, i.e., that they represented funds returned to the municipality that the local government could either use for other governmental purposes or pass on to taxpayers as a credit or reduction of their tax bills.

It is apparent from the words of the statute that it does not operate on that basis. The reduction of rent that comes as the result of the reduction of taxes could well be triggered simply because a municipality elected to perform fewer municipal services for which it was required to raise less taxes. We see no logic to the position that, because the government could, if it wished, [64 Wis.2d 288] have taxed more, it could order the diversion to others of what it could have levied but did not.

Despite the amorphous quality of both arguments in respect to public purpose, we conclude that the law is within the legislature's authority to enact, in the sense that it attempts to pass along to renters tax 'concessions' that owners have received. Budget Policy Paper 31, February 1973, pointed out that 53.5 percent of lowincome families rent their housing. It was estimated that a device that would pass along to tenants the tax concessions that landlords would receive might result in $19,000,000 per year of tax relief to 380,000 tenants.

We find this to be a public purpose in the sense that it is a matter within the general concern of government and of legislation. Presumptively, at least, some public purpose is sought to be served by this law. We cannot state out of hand that, as far as public purpose is concerned, this legislation is wholly without reason or objective associated with some concept of the general welfare. Under the presumption of constitutionality, we must assume that at least a goodly portion of tenants will be benefitted by this legislation and that at least some of those tenants are within an impoverished class that is of particular concern to a state government.

To say that the act is not unconstitutional because it outwardly serves some public purpose says but little, since the more important challenge to the law is whether the public purpose served is so important and exigent that it will justify the invocation of the state's police power in derogation of constitutionally secured rights.

Plaintiffs also argue that the statute fails because it is a property tax law

Page 279

which fails to operate uniformly on all property. Uniformity is required by the Wisconsin Constitution in respect to property taxes.

We find that the conflicting arguments in respect to uniformity miss the mark, for we see none of the indicia [64 Wis.2d 289] of a tax law in sec. 539. 1 Cooley, Taxation (4th ed., 1924), sec. 1, p. 61, said:

'Taxes are the enforced proportional contributions from persons and property, levied by the state by virtue of its sovereignty for the support of government and for all public needs.'

This definition was expressly approved in Fitch v. Wisconsin Tax Comm. (1930), 201 Wis. 383, 387, 230 N.W. 37.

Milwaukee v. Milwaukee & Suburban Transport Corp. (1959), 6 Wis.2d 299, 304, 94 N.W.2d 584, compiles a number of definitions of a tax. A tax is an exaction, usually of money, by the government for the support of government.

In the instant case, no funds are collected by the state, and no funds are disbursed or used for the purposes of government as a consequence of sec. 539. Whatever the nature of the exaction from a landlord here, it is not a tax in the sense that makes the uniformity clause relevant. Hence, the fact, arguendo, that the burden of the exaction does not fall uniformly does not mean the legislation is unconstitutional under the uniformity clause.

The most serious challenge to sec. 539 is that it impairs the obligation of contracts contrary to art. I, sec. 10, of the United States Constitution 1 and art. I, sec. 12, of the Wisconsin Constitution. 2

[64 Wis.2d 290] Applying these constitutional provisions, this court said in In re Cranberry Creek Drainage District v. La Vigne (1930), 202 Wis. 64, 68, 231 N.W. 588, 589:

"(A)n act which in...

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  • State ex rel. Briggs & Stratton Corp. v. Noll, 80-1098-OA
    • United States
    • United States State Supreme Court of Wisconsin
    • 3 Marzo 1981
    ...under its police powers only [100 Wis.2d 658] in emergency situations. This court did hold in State ex rel. Bldg. Owners v. Adamany, 64 Wis.2d 280, 288, 219 N.W.2d 274 "To say that the act is not unconstitutional because it outwardly serves some public purpose says but little, since the mor......
  • Wipperfurth v. U-Haul Co. of Western Wisconsin, Inc., U-HAUL
    • United States
    • United States State Supreme Court of Wisconsin
    • 29 Abril 1981
    ...Kuhl the curtailment was found to be a legitimate exercise of police power. This court stated in State ex rel. Bldg. Owners v. Adamany, 64 Wis.2d 280, 292, 219 N.W.2d 274 "We have thus accepted the proposition that the obligation of contract is not an absolute right, but is one that may be ......
  • Chappy v. Labor and Industry Review Com'n, Dept. of Industry, Labor and Human Relations, 84-2320
    • United States
    • United States State Supreme Court of Wisconsin
    • 6 Marzo 1987
    ...States Supreme Court. See State ex rel. Cannon v. Moran, 111 Wis.2d 544, 331 N.W.2d 369 (1983); State ex rel. Building Owners v. Adamany, 64 Wis.2d 280, 219 N.W.2d 274 (1974). Although the language of the contract clause appears to be absolute, "[n]o state shall ... pass any ... law impairi......
  • State v. Interstate Blood Bank, Inc., s. S
    • United States
    • United States State Supreme Court of Wisconsin
    • 31 Octubre 1974
    ...any reason, the case is resolved, and it is not necessary to consider other issues raised. State ex rel. Bldg. Owners v. Adamany (1974), 64 Wis.2d 280, 286, 219 N.W.2d For the purpose of this opinion, it can be assumed that the enactment of sec. 146.31(1), Stats., is a valid exercise of the......
  • Request a trial to view additional results
22 cases
  • State ex rel. Briggs & Stratton Corp. v. Noll, 80-1098-OA
    • United States
    • United States State Supreme Court of Wisconsin
    • 3 Marzo 1981
    ...under its police powers only [100 Wis.2d 658] in emergency situations. This court did hold in State ex rel. Bldg. Owners v. Adamany, 64 Wis.2d 280, 288, 219 N.W.2d 274 "To say that the act is not unconstitutional because it outwardly serves some public purpose says but little, since the mor......
  • Wipperfurth v. U-Haul Co. of Western Wisconsin, Inc., U-HAUL
    • United States
    • United States State Supreme Court of Wisconsin
    • 29 Abril 1981
    ...Kuhl the curtailment was found to be a legitimate exercise of police power. This court stated in State ex rel. Bldg. Owners v. Adamany, 64 Wis.2d 280, 292, 219 N.W.2d 274 "We have thus accepted the proposition that the obligation of contract is not an absolute right, but is one that may be ......
  • Chappy v. Labor and Industry Review Com'n, Dept. of Industry, Labor and Human Relations, 84-2320
    • United States
    • United States State Supreme Court of Wisconsin
    • 6 Marzo 1987
    ...States Supreme Court. See State ex rel. Cannon v. Moran, 111 Wis.2d 544, 331 N.W.2d 369 (1983); State ex rel. Building Owners v. Adamany, 64 Wis.2d 280, 219 N.W.2d 274 (1974). Although the language of the contract clause appears to be absolute, "[n]o state shall ... pass any ... law impairi......
  • State v. Interstate Blood Bank, Inc., s. S
    • United States
    • United States State Supreme Court of Wisconsin
    • 31 Octubre 1974
    ...any reason, the case is resolved, and it is not necessary to consider other issues raised. State ex rel. Bldg. Owners v. Adamany (1974), 64 Wis.2d 280, 286, 219 N.W.2d For the purpose of this opinion, it can be assumed that the enactment of sec. 146.31(1), Stats., is a valid exercise of the......
  • Request a trial to view additional results

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