State v. Holland Plastics Co.

• Decision Date: 29 March 1983
• Docket Number: No. 82-024,82-024
• Citation: 331 N.W.2d 320,111 Wis.2d 497
• Parties: STATE of Wisconsin, Plaintiff-Respondent, v. HOLLAND PLASTICS COMPANY, MacArthur Company, Johnson-Wagner-Isley-Widen and Hipp, Inc., Orville E. Madsen & Son, Inc., and Ettel and Franz Company, Defendants-Appellants.
• Court: Wisconsin Supreme Court

Page 320

331 N.W.2d 320

111 Wis.2d 497

STATE of Wisconsin, Plaintiff-Respondent, v. HOLLAND PLASTICS COMPANY, MacArthur Company Johnson-Wagner-Isley-Widen and Hipp, Inc., Orville E. Madsen & Son, Inc., and Ettel and Franz Company, Defendants-Appellants.

No. 82-024.

Supreme Court of Wisconsin.

Argued Feb. 28, 1983.

Decided March 29, 1983.

Robert Horowitz and Allen A. Arntsen (argued), Madison, for defendants-appellants; Richard A. Hollern, Jeffrey M. Gallagher and Stafford, Rosenbaum, Rieser & Hansen, Bradley D. Armstrong, Barbara J. Swan and Brynelson, Herrick, Gehl & Bucaida, Madison, Robert D. Sullivan and Merten & Schwemer, S.C., Milwaukee, on brief for Holland Plastics Co., MacArthur Co. and Orville E. Madsen & Son, Inc.; John F. Jenswold and Jenswold, Studt, Hanson, Clark & Kaufmann and Tom Jacobs and Frank Coyne Law Offices, Madison, on brief for Johnson-Wagner-Isley-Widen and Hipp, Inc., and Ettel and Franz Co.

John J. Glinski, Asst. Atty. Gen. (argued), for plaintiff-respondent; Bronson C. La Follette, Atty. Gen., on brief.

DAY, Justice.

This is an appeal from a nonfinal order of the circuit court for Dane county, William F. Eich, Judge, which denied the defendants' motion for summary judgment. The court of appeals granted the defendants' petition for leave to appeal pursuant to section 809.50, Stats.1979-80. The court of appeals then certified the case to this court pursuant to section (rule) 809.61, Stats.1979-80. The certification request was granted and the appeal accepted on October 12, 1982.

The issues considered on appeal are:

1) Is an action by the state for negligent construction and breach of contract governed by the ten year statute of limitations contained in section 893.18(6), Stats.1971, ¹ (now section 893.87, 1981-82), or by section 893.19(5), 1971, ² and section 893.19(3), 1971, ³ (now sections 893.52 and 893.43, 1981-82, respectively)? ⁴

2) If the state's action for negligent construction is governed by the six year limitation in section 893.19(5), does that statute bar the state's claim here?

3) If the state's action for breach of contract is governed by the six year limitation in section 893.19(3), does that statute bar the state's claim here?

We conclude that the action by the state is governed by the six year limitations in sections 893.19(5) and 893.19(3), Stats. We further conclude that section 893.19(3), Stats., bars the state's claim for damages for breach of contract. We remand the case to the trial court for a determination as to whether the state's action for negligent construction is barred by section 893.19(5), Stats.

This case involves problems which occurred in the construction of the roof of the Creative Communications Building on the campus of the University of Wisconsin--Green Bay.

Construction of the building was commenced in late 1970. According to the deposition of Mr. Gerald Germanson, chief of project management for the Wisconsin Department of Administration, Division of State Facilities Management, the "basic contract work" for the roof was completed by August 23, 1973.

Prior to the completion of the roof, construction observation reports dated January 24, March 28 and April 4, 1973, documented roof leakage in the building. These reports were made out by state employees.

The building was substantially completed on November 28, 1973. This action was commenced on October 31, 1979.

The complaint alleged that defendants Holland Plastics Company (Holland) and MacArthur Company (MacArthur) were negligent in the manufacture and sale of roof insulation which was used in the construction of the building. The complaint also alleged that defendant Ettel and Franz Company (Ettel) was negligent in using the wrong type of asphalt in the construction of the roof. Finally, the complaint alleged that defendants Johnson-Wagner-Isley-Widen and Hipp, Inc. (Johnson) and Orville E. Madsen & Son, Inc. (Madsen) acted negligently with regard to the construction of the roof and that both breached their contracts with the state involving the construction of the building.

Following a series of interrogatories and depositions, the defendants moved for summary judgment on the ground that the statute of limitations barred this action because the action was commenced more than six years after the cause of action accrued. The state countered by arguing that the applicable statute of limitations was that found in section 893.18(6), Stats.1971, and that section gave the state ten years to commence the action. The trial court found section 893.18(6) to be the applicable statute and determined that the action was commenced within the time limitations set out therein. The motion for summary judgment was therefore denied. The defendants appealed.

Under section 893.18(6), Stats.1971, the state is given ten years to commence an action in its favor "when no other limitation is prescribed in this chapter [Chap. 893 (1971) ]." In Gilman v. Northern States Power Co., 242 Wis. 130, 134-35, 7 N.W.2d 606 (1943), this court determined that the language of this statute "manifestly was intended ... to provide that the general limitation statutes ... should apply to the state and that a ten-year limitation was created to cover any case by the state not falling within the general limitation statutes or any special statutes." The question is whether the interpretation of section 893.18(6), Stats., which is set out in Gilman controls this case. We conclude it does.

Gilman involved an action by the Village of Gilman to recover funds which had allegedly been paid illegally to a utility for line construction. The action was commenced almost fifteen years after the money had been paid out. The village argued that no statute of limitations applied to the State or its subdivisions. The court examined this argument and rejected it. In so doing the Court held that the general limitation statutes applied to both the state and its subdivisions and the ten-year limitation was created to cover actions not falling under any other statute.

The state now argues that the language of Gilman is dicta because the state was not a party to the action. However, this argument ignores the fact that the village argued, and the court apparently accepted the argument, ⁵ that a subdivision of the state should stand in the same position as the state regarding the applicability of the statute of limitations. Thus, the court in determining which statute of limitation applied to actions by the village also determined which applied to the state.

The state next argues that even if the language in Gilman is not dicta, the holding in that case was based on an erroneous examination of the statute's legislative history and thus the holding was in error. However, the holding in Gilman did not rest upon its examination of the legislative history but rather relied on the language of the statute to show the "manifest" intent of the legislature.

The court's reference to legislative history in Gilman was not used to aid in a determination of what legislative intent was in creating the statute. Rather, the court looked at the words of the statute and determined that they were sufficiently clear and unambiguous so that it could properly determine that which was "manifestly intended by the enactment of the act." The court's use of the word "manifestly" ⁶ here is significant because it shows that it was the wording of statute upon which the court relied.

We find the language of the statute clear and unambiguous in setting a ten-year limitation for the state only when "no other limitation is prescribed." This court has stated repeatedly that where the language of a statute is clear, it is improper to resort to extrinsic aids for the purpose of statutory construction. Swanson Furniture v. Advance Transformer, 105 Wis.2d 321, 326, 313 N.W.2d 840 (1982); State v. Derenne, 102 Wis.2d 38, 45, 306 N.W.2d 12 (1981); Milwaukee v. Lindner, 98 Wis.2d 624, 632, 297 N.W.2d 828 (1980). The state's attempt to use legislative history to support its position is not persuasive in the face of the clear language of the statute.

The state next argues that the Gilman court's interpretation of the language in section 893.18(6) was explicitly rejected in Estate of Allen, 43 Wis.2d 260, 168 N.W.2d 869 (1969). In Allen, the state sought to enforce a claim under section 46.10, Stats., against a mother for the costs of taking care of her child who had been placed in a state institution for the mentally retarded. Relying upon four earlier decisions, ⁷ the court held that a ten year statute of limitations applied to the claims by the state under section 46.10. Allen, 43 Wis.2d at 264, 168 N.W.2d 869. The court considered Gilman but determined it to be inapplicable because the state was not a party in Gilman and because no statutory liability under section 46.10 was involved.

The fact that the state was not a party in Gilman was shown previously to be insignificant in determining the validity of the court's interpretation of section 893.18(6). It is clear that the court in Allen did not overrule the holding in Gilman but rather distinguished it out of deference to the principle of stare decisis. The most that can be said of the Allen case is that it reaffirmed a very narrow exception to the general rule set out in Gilman.

We conclude that section 893.18(6), Stats.1971, (now section 893.87 1981-82), sets a ten-year limitation for actions by the state only where the action is of such a type that it does not fall under any other of the limitations set out in the limitations chapter of the statutes.

Because of our holding above, it is clear that section 893.19(5), Stats.1971, and section 893.19(3), 1971, governed this action. The question thus becomes whether those statutes operate to bar this action.

As an initial matter, the defendants ask this court to refuse to consider these questions contending that these are issues which were raised by the state...