State v. Hall

• Decision Date: 24 January 1997
• Docket Number: No. 94-2848-CR,94-2848-CR
• Citation: 207 Wis.2d 54,557 N.W.2d 778
• Parties: STATE of Wisconsin, Plaintiff-Respondent, v. Darryl J. HALL, Defendant-Appellant-Petitioner.
• Court: Wisconsin Supreme Court

Page 778

557 N.W.2d 778

207 Wis.2d 54

STATE of Wisconsin, Plaintiff-Respondent, v. Darryl J. HALL, Defendant-Appellant-Petitioner.

No. 94-2848-CR.

Supreme Court of Wisconsin.

Argued Sept. 24, 1996.

Decided Jan. 24, 1997.

For the defendant-appellant-petitioner there were briefs by Jerome F. Buting, Pamela S. Moorshead and Buting & Williams, S.C., Brookfield and Robert R. Henak and Shellow, Shellow & Glynn, S.C., Milwaukee and oral argument by Jerome F. Buting & Robert R. Henak.

For the plaintiff-respondent the cause was argued by Gregory M. Posner-Weber, Assistant Attorney General, with whom on the brief was James E. Doyle.

Amicus curiae brief was filed by Michael J. Fitzgerald and Coffey, Coffey & Geraghty, Milwaukee for the American Civil Liberties Union of Wisconsin Foundation and Wisconsin Association of Criminal Defense Lawyers.

WILLIAM A. BABLITCH, Justice.

Darryl J. Hall challenges the constitutionality of the drug tax stamp law ("the stamp law"), cited in full below. ¹ Hall was convicted and sentenced to two consecutive three-year sentences under the stamp law, and, concurrently, two consecutive 30-year sentences for delivery of cocaine base convictions. The delivery convictions, and their 30-year sentences, are not before us. The stamp law requires dealers to purchase tax stamps for illegal drugs in their possession and affix the stamps to the drugs. Hall argues that the stamp law is unconstitutional because it violates his privilege against self-incrimination under both the federal and the Wisconsin constitutions. The State of Wisconsin (State) argues that the stamp law provides protection that is coextensive with the privilege against self-incrimination and therefore is constitutional. We conclude that because the stamp law fails to protect against the derivative use, in a criminal proceeding, of information it compels, it violates the privilege against self-incrimination and is therefore unconstitutional. Although identifying and prosecuting drug dealers is a laudable purpose which this court whole-heartedly applauds, the legislature failed to use constitutional means to achieve this purpose. We therefore reluctantly strike down the drug tax stamp law as unconstitutional. Accordingly, we reverse.

The facts are undisputed. The State enacted a law requiring "dealers" to purchase tax stamps for the drugs in their possession and to affix the stamps to their illegal drugs. The statute defines "dealer," as "a person who in violation of ch. 161 possesses, manufactures, produces, ships, transports, delivers, imports, sells or transfers to another person more than ... 7 grams of any other schedule I controlled substance or schedule II controlled substance." Wis. Stat. § 139.87(2). The drug tax is paid by purchasing stamps issued by the Department of Revenue (DOR). Wis. Stat. § 139.89. Drug tax stamps must be affixed to the drugs for which the tax has been paid. § 139.89. Failure to pay the required tax subjects the violator to incarceration for a term not to exceed five years, a fine of not more than $10,000, or both. § 139.95.

Hall was arrested, charged, and convicted of two counts of delivering cocaine base, contrary to Wis. Stats. §§ 161.41(1)(cm)4, 161.48, and 161.49, and two counts of failing to comply with the drug tax stamp law, contrary to Wis. Stat. ch. 139, subch. IV. On December 3, 1993, in the circuit court of Dane County, Judge Richard J. Callaway sentenced Hall to two consecutive three-year sentences for the stamp law convictions and, concurrently, two consecutive 30-year sentences for the delivery convictions.

Affirming Hall's stamp law convictions, the court of appeals concluded that the statute would be unconstitutional if the State could use information it compelled either directly or derivatively against the dealer in a criminal proceeding and, on its face, the statute failed to protect against derivative use of compelled information. State v. Hall, 196 Wis.2d 850, 867-68, 540 N.W.2d 219 (1995). However, the court of appeals applied a "saving construction" to the statute, interpreting the confidentiality provision to prohibit both direct and derivative use of compelled information and consequently providing Hall with protection coextensive to the privilege against self-incrimination.

Both the United States and Wisconsin Constitutions protect persons from state compelled self-incrimination. Whether or not a statute violates these constitutional provisions presents a question of law that we review de novo. State v. McManus, 152 Wis.2d 113, 129, 447 N.W.2d 654 (1989).

This case presents three issues: (1) whether Wis. Stat. § 139.89 of the stamp law unconstitutionally compels self-incrimination; and if so, (2) whether Wis. Stat. § 139.91, the confidentiality provision of the stamp law, on its face, provides Hall with protection as broad as the protection offered by the privilege against self-incrimination; and if not, (3) whether the confidentiality provision may be construed in a manner which provides protection coextensive with the privilege. ² We conclude that the stamp law unconstitutionally compels self-incrimination, the confidentiality provision of the stamp law fails to provide protection coextensive with the privilege, and the stamp law cannot be construed to provide constitutional protection.

I.

First, we consider whether Wis. Stat. § 139.89 of the stamp law unconstitutionally compels Hall to incriminate himself. The right against self-incrimination is a fundamental right guaranteed by both the United States and the Wisconsin Constitutions. In re Grant, 83 Wis.2d 77, 80, 264 N.W.2d 587 (1978). Under the Fifth Amendment's self-incrimination clause, "[n]o person ... shall be compelled in any criminal case to be a witness against himself...." U.S. Const., amend. V. Our state constitution provides that "[n]o person ... may be compelled in any criminal case to be a witness against himself or herself." Wis. Const. art. I, § 8(1). Although much of the analysis of this opinion is derived from United States Supreme Court decisions construing the Fifth Amendment privilege, the same analysis applies in determining the protection afforded by Hall's state privilege. State v. Schultz, 152 Wis.2d 408, 416, 448 N.W.2d 424 (1989); State v. Sorenson, 143 Wis.2d 226, 259-60, 421 N.W.2d 77 (1988).

The privilege against self-incrimination may be invoked whenever a person has a real and appreciable apprehension that information compelled by the state could be used against him or her in a criminal proceeding. Grant, 83 Wis.2d at 81, 264 N.W.2d 587. The privilege extends not only to the direct use of information which would support a conviction, but also to derivative use of such evidence, i.e., using compelled information to furnish a link in the chain of evidence necessary for prosecution. Id. Darryl Hall contends that his compliance with the tax law would have provided the State with information that he reasonably supposed could have been used against him in a prosecution for violation of any one of several crimes contained in Wis. Stat. ch. 161, Wisconsin's Uniform Controlled Substances Act. We agree.

The United States Supreme Court has carefully considered the impact of tax laws on Fifth Amendment guarantees against self-incrimination. Leary v. United States, 395 U.S. 6, 89 S.Ct. 1532, 23 L.Ed.2d 57 (1969); Marchetti v. United States, 390 U.S. 39, 88 S.Ct. 697, 19 L.Ed.2d 889 (1968); Grosso v. United States, 390 U.S. 62, 88 S.Ct. 709, 19 L.Ed.2d 906 (1968). In Marchetti, the defendant was convicted of violating federal wagering statutes which required persons engaged in professional gambling to pay an occupational tax and to register with the Internal Revenue Service. Marchetti complained that these statutory obligations violated his Fifth Amendment right against self-incrimination because they significantly enhanced the likelihood that those who complied with the provisions would be successfully prosecuted for violating state and federal anti-gambling laws. The Court agreed, identifying the following criteria for determining the constitutionality of a tax statute challenged on Fifth Amendment grounds: (1) whether the regulated activity is in an area "permeated with criminal statutes," and the tax aimed at individuals "inherently suspect of criminal activities;" (2) whether an individual is required, under pain of criminal prosecution, to provide information which a person might reasonably suppose would be available to prosecuting authorities; and (3) whether such information would provide a significant link in a chain of evidence tending to establish guilt. Sisson v. Triplett, 428 N.W.2d 565, 571 (Minn.1988)(explaining Marchetti ). These criteria form the three prongs of the Marchetti test. If all three are met, the tax statute violates the privilege against self-incrimination.

The fear of self-incrimination must be real and appreciable, not merely an imaginary possibility of danger. In re Grant, 83 Wis.2d at 82, 264 N.W.2d 587. The danger should be appraised with reference to the ordinary operation of law in the ordinary course of things, not danger of an imaginary or insubstantial character. Id. This court has liberally construed the privilege in favor of the right which it was intended to protect. Id. We analyze the stamp law in light of these principles, and apply the three-prong Marchetti test.

Hall contends that two requirements of the stamp law violate his privilege against self-incrimination: (1) the purchase requirement; and (2) the requirement that tax stamps must be affixed to a dealer's drugs. He argues that these requirements violate his privilege in two ways: (1) by requiring a dealer, when purchasing stamps, to provide incriminating information that may be used by prosecutors against him in a criminal proceeding; and (2) by providing vital evidence in a prosecutor's case against a dealer who complies with the statute and affixes the stamps to illicit...