State ex rel. Wis. Dev. Auth. v. Dammann

• Decision Date: 21 June 1938
• Citation: 280 N.W. 698,228 Wis. 147
• Parties: STATE ex rel. WISCONSIN DEVELOPMENT AUTHORITY et al. v. DAMMANN, Secretary of State (three cases).
• Court: Wisconsin Supreme Court

228 Wis. 147

280 N.W. 698

STATE ex rel. WISCONSIN DEVELOPMENT AUTHORITY et al.

v. DAMMANN,Secretary of State (three cases).

Supreme Court of Wisconsin.

March 1, 1938.

On Rehearing June 21, 1938.

Appeal from Circuit Court, Dane County; Alvin C. Reis, Judge.

On rehearing.-[By Editorial Staff.] Former mandate vacated and set aside. For prior opinion, see 277 N.W. 278.

FOWLER and FAIRCHILD, JJ., dissenting.Harold E. Stafford, of Chippewa Falls, for appellant.

Orland S. Loomis, Atty. Gen., John Ernest Roe, Special Counsel, of Madison, Norris E. Maloney, of Madison, Charles B. Perry, of Milwaukee, N. S. Boardman, of Madison, and Ralph M. Hoyt, of Milwaukee, for respondent.

William Ryan, R. M. Rieser, J. W. Rector, Roy G. Tulane, Olin & Butler, and James F. Malone, all of Madison, Herb. J. Smith, of De Pere, and Frank W. Lucas, re of Madison, William H. Dieterich, Jr., of Milwaukee, Special Counsel, and Lloyd K. Garrison, Jacob H. Beuscher, and Ray A. Brown, all of Madison, amici curiae.

PER CURIAM.

The motion for rehearing in these cases is granted and the case is set down for argument on April 15, 1938.

Private corporations receiving state aid which are so advised or which deem themselves affected are invited to file briefs amicus curiae. Such briefs should set out the applicable statutes and indicate the purposes for which the corporation is organized, to what extent if at all the state by its representatives participates in the organization, the amount of state aid received and the purposes for which it is authorized to be expended, together with such other matters as may be material and relevant.

On Rehearing.

WICKHEM, Justice.

Upon motion for rehearing, a reargument was ordered of the questions deemed determinative by the court in its original opinion. After a careful consideration of the able and exhaustive briefs filed upon rehearing and a complete review of the question, we conclude that we were in error in holding that chapter 334, Laws of 1937, St.1937, sections 20.514, 199.01 to 199.07 constituted an invalid delegation of executive power to a private corporation and designation of such corporation as a public officer. Upon the original argument the extremely far-reaching and difficult question of the circumstances under which sovereign power might be vested in private persons or corporations was naturally stressed. This question has an extensive history and is of extreme present importance in view of the pressure which the complexities of modern life have put upon all governmental agencies, particularly those of an administrative character, and the demand that relief be sought by delegating to private groups some of the functions of the government. See 51 Harvard Law Review 201. We are satisfied that in centering our attention upon this very large question we failed to give adequate weight to the extent of the pre-existing corporate powers of the Wisconsin Development Authority. When these are considered in relation to the act, the act must be held to constitute a mere appropriation measure and not to confer sovereign power upon the corporation, or indeed any power at all except to spend the allotted money for purposes defined in the act.

The Wisconsin Development Authority was incorporated under the provisions of sec. 180.01, Stats., which provides:

“Three or more adult residents of this state may form a corporation in the manner provided in this chapter for any lawful business or purpose whatever, except banking, insurance and building or operating public railroads ***.”

The articles were filed March 30, 1937. The act was published July 1, 1937. For the sake of convenience we have numbered the purposes stated in subsection (A) of “Article First” and have put the corresponding provision of the Wisconsin Development Authority Act immediately following.

Article First. A (1) provides: “To promote and encourage the organization or creation of municipal power districts in the state under Chapter 198 of the Wisconsin statutes.” “199.03 (1) To promote or encourage the organization or creation of municipal power districts in the state under chapter 198.”

Article First. A (2) provides: “To promote and encourage the organization or creation of cooperative associations and nonprofit corporations to engage in the production, transmission, distribution or furnishing of light, heat, water or power, the transmission of telephone messages, or the rendering of street or interurban railway or bus services.”

“199.03 (2) To promote or encourage the organization or creation of co-operative associations and nonprofit corporations to engage in the production, transmission, distribution or furnishing of light, heat, water or power, or the rendering of street or interurban railway or bus services.”

Article First. A (3) “To promote or encourage the acquisition, ownership, construction, operation or management of any plant, equipment or facilities, or any part thereof, for the production, transmission, distribution or furnishing of light, heat, water or power, the transmission of telephone messages, or the rendering of street or interurban railway or bus services, by any cooperative association or non-profit corporation, or any group or combination of cooperative associations or non-profit corporations;”

“199.03 (3) To promote or encourage the acquisition, ownership, construction, operation or management of any plant, equipment or facilities, or any part thereof, for the production, transmission, distribution or furnishing of light, heat, water or power, or the rendering of street or interurban railway or bus services, by any co-operative association or nonprofit corporation, or any group or combination of co-operative associations or nonprofit corporations;”

Article First. A (4) provides: “To promote or encourage the acquisition, ownership, construction, operation or management of any plant, equipment or facilities, or any part thereof, for the production, transmission, distribution or furnishing of light, heat, water or power, the transmission of telephone messages, or the rendering of street or interurban railway or bus services, by any of the cities, villages, towns, municipalities, municipal power districts, or other political or governmental units of the state, or any group or combination thereof.”

“199.03 (4) To promote or encourage the acquisition, ownership, construction, operation or management of any plant, equipment or facilities, or any part thereof, for the production, transmission, distribution or furnishing of light, heat, water or power, or the rendering of street or interurban railway or bus services, by any of the cities, villages, towns, municipalities, municipal power districts, or other political or governmental units of the state, or any group or combination thereof.”

Article First. A (5) provides: “To survey the resources and facilities, existing and potentially available, for the production, transmission, distribution and furnishing of light, heat, water and power in the state; to make studies and surveys for the economical development, use and conservation of such resources and facilities as will best provide an abundant and cheap supply of light, heat, water and power for industrial, agricultural, commercial, governmental, transportation and domestic purposes; to make studies and surveys for the coordination of water power and fuel power developments with the regulation of rivers by storage or otherwise for water supply, navigation, flood control, soil conservation, public health, recreational and other uses;”

“199.03 (5) To survey the resources and facilities, existing and potentially available, for the production, transmission, distribution and furnishing of light, heat, water and power in the state; to make studies and surveys for the economical development, use and conservation of such resources and facilities as will best provide an abundant and cheap supply of these essential services for industrial, agricultural, commercial, governmental, transportation and domestic purposes; and to make studies and surveys for the co-ordination of water power and fuel power developments with the regulation of rivers by storage or otherwise for water supply, navigation, flood control, soil conservation, public health, recreational and other uses.”

Article First. A (6) provides: “To collect and disseminate information and engage in research, planning and educational activities necessary or useful for carrying out any or all of the business and purposes of this corporation.”

“199.03 (6) To collect and disseminate information and engage in research, planningand educational activities necessary or useful for the execution of its duties and functions under this section.”

Article First. B Provides: “To assist and cooperate with the state and federal governments and their various agencies, departments and authorities, and the several cities, villages, towns, municipalities, municipal power districts and other political or governmental units, of the state of Wisconsin, and persons, firms, associations, corporations, cooperative associations and other organizations in the carrying out of any or all of the business and purposes of this corporation;”

“199.03 (7) To co-operate with the federal government and its agencies in the execution of its duties and functions under this section.”

In the articles of incorporation other purposes are specified which may briefly be summarized as follows: To account for the use made of funds received by it from the state or federal government which funds are to be expended only in accordance with the terms of the grant under which they are received; to furnish technical services such as engineering, bookkeeping, etc., with power to enter into contracts for services, etc.; to acquire, manage, and operate plants; the right of condemnation; to borrow money, to draw, make and endorse, etc.; to acquire by purchase and to hold, pledge, sell and exchange securities; and to...