State ex rel. Campbell v. Township of Delavan

• Decision Date: 16 April 1997
• Docket Number: No. 96-1291,96-1291
• Citation: 565 N.W.2d 209,210 Wis.2d 239
• Parties: STATE of Wisconsin ex rel. James G. CAMPBELL and Holly Campbell, Plaintiff-Respondents, v. TOWNSHIP OF DELAVAN, Walworth County, Wisconsin, Board of Review, Defendants-Appellants.
• Court: Wisconsin Court of Appeals

Page 209

565 N.W.2d 209

210 Wis.2d 239

STATE of Wisconsin ex rel. James G. CAMPBELL and Holly Campbell, Plaintiff-Respondents, v. TOWNSHIP OF DELAVAN, Walworth County, Wisconsin, Board of Review, Defendants-Appellants.

No. 96-1291.

Court of Appeals of Wisconsin.

Submitted on Briefs Feb. 6, 1997.

Opinion Released April 16, 1997.

Opinion Filed April 16, 1997.

For the defendants-appellants the cause was submitted on the briefs of George D. Mistrioty and Steven R. Wassel of Wassel, Kilkenny, Danz, Mistrioty & Lettenberger of Delavan.

For the plaintiffs-respondents the cause was submitted on the brief of Thomas S. Hornig and Margery Mebane Tibbetts of Brennan, Steil, Basting & MacDougall, S.C. of Janesville.

Before BROWN, NETTESHEIM and ANDERSON, JJ.

ANDERSON, Judge.

The Township of Delavan Board of Review (Board) appeals the trial court's order reversing its valuation of James G. and Holly Campbell's (the Campbells) 1994 real estate tax assessment of their Delavan Lake home. The Board also appeals the trial court's order for judgment in favor of the Campbells and against the Attorneys for the Board (Attorneys) pursuant to § 802.05, STATS. We agree with the trial court that the record of the Board was improperly supplemented with additional "items" not submitted to the Board and affirm the order for sanctions. Because we also conclude that the Board utilized inappropriate factors when reassessing the Campbells' property at $788,300, we affirm that portion of the trial court's order as well. However, we conclude that the trial court erred when it ordered the Board to reassess the Campbells' property at a value between $600,000 and $630,000; accordingly, we reverse that portion of the order. We direct the trial court to remand the matter to the Board to take action consistent with this opinion.

Background

The Campbells own a Frank Lloyd Wright design home located along approximately 290 feet of waterfront in the town of Delavan. ¹ The town had a complete revaluation of all property for the 1994 assessment year, including the Campbells' property. The town's assessor estimated the value of their property to be $435,700 for the land, plus $398,300 for improvements, for a total assessment of $834,000. The increase constituted an eighty percent increase in two years; the 1992 assessment of the Campbells' property was $464,000.

The Campbells filed an objection to the assessment. On December 16, 1994, the Board held a hearing to review the assessment. Testimony was taken from the Campbells' appraiser, Linn Duesterbeck, as well as the town's assessor, Bernie Laird, after which the Board only reduced the land assessment to $390,000 for a total assessment of $788,300.

Consequently, the Campbells filed a petition for writ of certiorari in the Walworth County Circuit Court. The Campbells argued that the adjusted assessment exceeded the property's fair market value and the assessor and the Board failed to follow the valuation method mandated by § 70.32(1), STATS. An order for writ of certiorari was issued by the court. The Board, through its Attorneys, filed a return of writ of certiorari on May 11, 1995, along with an affidavit of the town clerk.

In a memorandum decision ² dated October 5, 1995, the trial court determined that the Board acted outside its jurisdiction in reviewing the town assessor's valuation of the Campbells' property. The trial court concluded that the assessment was not made according to law and was unreasonable, and that the evidence in the record was insufficient to sustain the Board's decision. The trial court also included directions for the proceedings on remand and retained jurisdiction of the matter until the Board determined an assessment in accordance with its order.

On October 16, 1996, the Campbells moved the trial court for costs and attorney's fees pursuant to §§ 802.05 and 814.025, STATS., alleging that the Board's actions and pleadings filed in defense to the petition for certiorari were frivolous and without a reasonable basis in law. The trial court agreed in a written decision dated February 8, 1996, followed by a written judgment incorporating that ruling on March 18, 1996. On April 11, 1996, the trial court entered a written order providing that "[b]ased upon this Court's Memorandum Decision dated and filed with the court October 5, 1995, and the Court's Judgment dated March 18, 1996," the matter was remanded to the Board. The Board was ordered "to utilize[ ] the evidence in the record and the methodology required by § 70.32(1), Wis. Stats., to re-assess [the Campbells'] property for 1994 tax purposes at a value between $600,000 and $630,000." The Board appeals. Additional facts will be included within the body of the decision as necessary.

The Board makes three arguments: (1) the trial court erred by requiring the Board to set the value of the subject real estate between $600,000 to $630,000, (2) the trial court misapplied the mandates of § 70.32(1), STATS., and (3) the trial court erred in awarding sanctions for the Attorneys' failure to make an investigative inquiry. We will address them in reverse order.

Section 802.05, STATS

., Sanctions

The Attorneys argue that the trial court erroneously applied § 802.05, STATS. Section 802.05 is composed of three prongs: (1) the person who signs a pleading, motion or other paper certifies that the paper was not interposed for any improper purpose; (2) the signer warrants that to his or her best "knowledge, information and belief formed after reasonable inquiry" the paper is "well grounded in fact"; and (3) the signer certifies that he or she has conducted a reasonable inquiry and that the paper is warranted by existing law or a good faith argument for a change in it. See Riley v. Isaacson, 156 Wis.2d 249, 256, 456 N.W.2d 619, 621 (Ct.App.1990). If any one of these three prongs has been violated, sanctions must be imposed. See id. at 256, 456 N.W.2d at 621-22.

Our standard of review is a deferential one. See id. at 256, 456 N.W.2d at 622. Determining what and how much prefiling investigation was done is a question of fact and we are bound by the trial court's findings unless they are clearly erroneous. See id. Determining how much investigation should have been done is a matter within the trial court's discretion. We will sustain a discretionary act if the trial court examined the relevant facts, applied a proper standard of law and, using a demonstrated rational process, reached a conclusion that a reasonable judge could reach. See id. at 256-57, 456 N.W.2d at 622.

The trial court made several factual findings relative to the Campbells' claims that the Attorneys' defense lacked a legitimate basis in fact and law and that the Attorneys improperly submitted exhibits not introduced into the record before the Board. The trial court based its determination on the following:

1. Respondents' brief maintains that the Board and the Assessor complied with § 70.32, Wis. Stats. in that they considered sales of reasonably comparable properties. Respondents attempt to discount the fact that the Assessor admitted that he used an arbitrary "front-footage" formula to assess Petitioners' property .... The fact that Respondents included exhibits that were not presented to the Board indicates the Respondents knew the record did not support their position.

2. The submission of items not included in the record before the Board is evidence of the Respondents' Attorneys' choice to ignore the law for improper purpose.

3. Further evidence that the inclusion of these items was done for improper purpose is the fact that the record was submitted to the court under a transmittal letter .... [which] indicated that a copy of the cover letter and affidavit were sent to Petitioners' attorney. An affidavit filed by Petitioners' attorney stated that at no time did he receive a copy of Respondents' Attorneys' transmittal letter or affidavit of the clerk certifying that the documents were original exhibits produced at the Board of Review hearing. Respondents intentionally did not send copies of the letter and affidavit in order to keep Petitioners from objecting to the submission. At no time in Respondents' brief on the merits of the certiorari action did they refute the allegations of supplementing the record .... [nor] did Respondents address the allegations of not properly sending copies to Petitioners' attorney.

The record supports these findings. Moreover, the Attorneys do not contest these findings; rather, they argue that "the Return to the Writ of Certiorari is not a pleading that requires service on all parties .... Although the Return ... was signed by an attorney ... no legitimate sanction can or should be imposed. The document in question is not a pleading." Although we agree that a return to the writ of certiorari is not a pleading, see State ex rel. Sahagian v. Young, 141 Wis.2d 495, 499, 415 N.W.2d 568, 570 (Ct.App.1987), it does constitute "other paper" of a party and is therefore subject to § 802.05, STATS., sanctions. We conclude that the trial court's findings of fact are not clearly erroneous.

Our second inquiry is whether the trial court misused its discretion in concluding that the Attorneys' actions failed to meet the legal standard of reasonable inquiry. See Riley, 156 Wis.2d at 258, 456 N.W.2d at 622. The Attorneys play a major deflection game in an attempt to avoid the imposed sanctions. They argue that their defense was reasonable because (1) they relied on what the town clerk "claims to constitute the record"; (2) the Campbells never brought a motion to correct the record prior to their motion for costs and fees; (3) "the documentation was supplied to the Trial Court for consideration if appropriate and exclusion if inappropriate"; (4) "the record" is not specifically defined by statutes; and (5) all documents listed on the return and supporting affidavit "were used during the testimony at [the hearing] and for that...