Village of Shorewood v. Steinberg, 91-0506

CourtUnited States State Supreme Court of Wisconsin
Writing for the CourtCECI
Citation174 Wis.2d 191,496 N.W.2d 57
PartiesVILLAGE OF SHOREWOOD, a municipal corporation, Petitioner-Condemnor-Appellant-Petitioner, v. Robert A. STEINBERG, Hiram A. Dorfman, Mark E. Schussel, and First Bank, N.A., Condemnees-Respondents. . Oral Argument
Docket NumberNo. 91-0506,91-0506
Decision Date30 November 1992

For the petitioner-condemnor-appellant-petitioner there were briefs by Hugh R. Braun, M. Susan Maloney and Godfrey, Braun & Hayes, Milwaukee and oral argument by Hugh R. Braun.

For the condemnees-respondents there was a brief by Alan Marcuvitz, Andrea Roschke and Weiss, Berzowski, Brady & Donahue, Milwaukee and oral argument by Alan Marcuvitz and Andrea Roschke.

CECI, Justice.

This case comes before the court on the Village of Shorewood's petition for review of a published court of appeals decision, Village of Shorewood v. Steinberg, 166 Wis.2d 794, 480 N.W.2d 780 (Ct.App.1992). The court of appeals decision affirmed an order of the circuit court for Milwaukee County, Francis T. Wasielewski, Circuit Judge, which awarded litigation expenses under sec. 32.28(3)(d), Stats., to condemnees Robert A. Steinberg, Hiram A. Dorfman, Mark E. Schussel, and First Bank, N.A. (Steinberg). Shorewood makes three arguments. First, the circuit court did not have jurisdiction to award litigation expenses. Second, the circuit court erroneously exercised its discretion when it awarded the condemnees litigation expenses which included $108,867 in attorney's fees. Finally, the contingent fee agreement between Steinberg and Attorney Alan Marcuvitz is unenforceable as a matter of law. We reject Shorewood's arguments and affirm the court of appeals decision.

In December of 1986, Steinberg purchased a 2.8-acre parcel of vacant land in Shorewood (Parcel C) for $626,000. Later that month, Steinberg conveyed the property to Parklane Associates, a partnership made up of Steinberg, Marcuvitz, and others. Steinberg remained the record owner of Parcel C until March 26, 1990.

In 1989, Shorewood began negotiating with Steinberg in order to purchase Parcel C. Marcuvitz, a partner in the Parklane partnership, negotiated with Shorewood as "Partner in Charge" of Parklane. In a letter dated February 23, 1989, Shorewood offered Steinberg $560,000 for Parcel C. Marcuvitz rejected that offer.

Shorewood then adopted a "Resolution of Necessity," after determining it needed Parcel C for park purposes. See sec. 32.07(2), Stats. Shorewood obtained two appraisals of Parcel C. One set the value of Parcel C at $639,000, the other at $675,000. Steinberg also obtained an appraisal which set the value of Parcel C at $995,000.

In January of 1990, Shorewood and Marcuvitz negotiated a tentative agreement which would have had Shorewood pay $650,000 for the property. The tentative agreement was subject, however, to a reappraisal of the property, which was necessary because Shorewood had discovered that Parcel C was filled land.

Shorewood obtained a report on Parcel C's soil condition which indicated that the land was filled and as a result, construction costs on the site would increase by $330,000. Armed with this new information, Shorewood's two appraisers lowered their appraisals of Parcel C to $309,000 and $345,000. Steinberg's appraiser still thought the land was worth $995,000. Negotiations ended when Parklane made a non-negotiable demand for $1,280,834.68.

On March 21, 1990, Shorewood made a jurisdictional offer of $345,000 which Steinberg promptly rejected.

Two days later, Marcuvitz--who besides holding shares in Parklane is also of counsel to the law firm of Weiss, Berzowski, Brady, & Donahue--entered into a fee agreement on behalf of Weiss, Berzowski, Brady & Donahue with Parklane. The agreement was signed on behalf of Parklane by a Mr. D. Grande. The relevant part of the agreement provided that if resolution of the matter occurred "as a result of a contested proceeding, our fee will be 33 1/3% of any amount obtained above the [jurisdictional offer]."

Shorewood petitioned for assignment of the matter to the condemnation commission. See sec. 32.06(7), Stats. The venue line of the petition read: "Before a Judge of the Circuit Court of Milwaukee County." Judge Wasielewski assigned the matter to the condemnation commission.

A three-person panel held a hearing and awarded Steinberg damages of $655,000. Neither party appealed the commission's award. Shorewood paid the amount of the award, plus interest, less prorated taxes, to the clerk of courts who disbursed the amount to Steinberg.

Steinberg then filed a petition for payment of litigation expenses under sec. 32.28(3)(d), Stats. The petition claimed litigation expenses of $112,358.40. These litigation expenses included a claim for attorney's fees of $108,867.00--one-third the difference between the commission's award plus interest ($671,600) and the jurisdictional offer ($345,000). Shorewood moved to dismiss the petition on the ground that Judge Wasielewski lacked jurisdiction. Judge Wasielewski denied the motion, held an evidentiary hearing on the petition, and ordered Shorewood to pay the claimed litigation expenses.

Shorewood appealed from that order. The court of appeals, with Judge Thomas Cane dissenting, affirmed. Village of Shorewood, 166 Wis.2d at 797, 480 N.W.2d 780.

The first issue is whether Judge Wasielewski had competency to award litigation expenses under sec. 32.28(3)(d), Stats. Shorewood frames the issue as one of jurisdiction, but Wis. Const. art. VII, sec. 8 confers plenary jurisdiction upon our circuit courts. In Matter of Guardianship of Eberhardy, 102 Wis.2d 539, 550-51, 307 N.W.2d 881 (1981). See also Mueller v. Brunn, 105 Wis.2d 171, 176, 313 N.W.2d 790 (1982). Therefore, rather than jurisdiction, the issue is one of the circuit court's competency, which is the lesser power to exercise subject matter jurisdiction. See Miller Brewing Co. v. LIRC, 173 Wis.2d 700, 705, n. 1, 495 N.W.2d 660 (1993); In Interest of B.J.N., 162 Wis.2d 635, 656-57, 469 N.W.2d 845 (1991); In Interest of L.M.C., 146 Wis.2d 377, 390-92, 432 N.W.2d 588 (Ct.App.1988) ("Common legal usage elsewhere in this country does not reflect the situation in Wisconsin.").

We review the issue of the circuit court's competency to award litigation expenses de novo. See State ex rel. R.G. v. W.M.B., 159 Wis.2d 662, 666, 465 N.W.2d 221 (Ct.App.1990). The party asserting a lack of competency has the burden of proving that assertion. See id. at 668, 465 N.W.2d 221.

Shorewood claims that Judge Wasielewski lacked competency to award litigation expenses under sec. 32.28(3)(d), Stats., because sec. 32.28(3)(d) authorizes the "court" to award litigation expenses, and Judge Wasielewski, who assigned the case to the condemnation commission under sec. 32.06(7), Stats., acted not as a "court," but as an administrative authority. Shorewood contends that Judge Wasielewski did not act as a "court" because neither party appealed the commission's award, and Steinberg did not commence a new action for litigation expenses.

Shorewood cites Schroedel Corp. v. State Highway Comm., 34 Wis.2d 32, 148 N.W.2d 691 (1967); Acheson v. Winnebago County Highway Comm., 14 Wis.2d 475, 111 N.W.2d 446 (1961); and Madison v. Tiedeman, 1 Wis.2d 136, 83 N.W.2d 694 (1957), for the proposition that "a judge to whom a petition for assignment is addressed, acts only in an administrative capacity." These cases (all decided before sec. 32.28, Stats., became effective) dealt with issues that arose before the condemnation commission had made an award. Schroedel, 34 Wis.2d at 35, 148 N.W.2d 691 (issue of whether assignment of condemnation appeal to condemnation commission was performed by "judge" or "court"); Tiedeman, 1 Wis.2d at 137-38, 83 N.W.2d 694 (issues of proper pleadings and appellate review before condemnation commission had made an award); Acheson, 14 Wis.2d at 478, 111 N.W.2d 446 (issue of appellate review before condemnation commission had made an award). The procedural posture of Schroedel, Tiedeman, and Acheson was essential to their holdings; this case presents a different procedural posture than those cases. Because Steinberg filed its petition for litigation expenses after the condemnation commission made its award, the cases Shorewood relies on do not answer the question of whether Judge Wasielewski had competency to award litigation expenses. To resolve this issue, we must interpret sec. 32.28(3)(d), Stats.

We interpret statutes de novo and do so in order to ascertain the legislature's intent. Voss v. City of Middleton, 162 Wis.2d 737, 749, 470 N.W.2d 625 (1991). We first look to the statute's language. Id. If that language is clear and unambiguous, our inquiry ends, and we must simply apply that language to the facts of the case. Id. If, and only if, the language is ambiguous, we resort to judicial construction to ascertain and carry out legislative intent. Id. A statute is ambiguous if reasonably well-informed persons could understand it in two or more ways. Hurst v. State, 72 Wis.2d 188, 195, 240 N.W.2d 392 (1976). The interaction of two statutes can create an ambiguity, as can the interaction of words in the statute. State v. Kenyon, 85 Wis.2d 36, 49, 270 N.W.2d 160 (1978). In construing an ambiguous statute, we may examine the history, context, subject matter, scope, and object of the statute. Voss, 162 Wis.2d at 749, 470 N.W.2d 625.

Section 32.28(3)(d), Stats., provides:

32.28 Costs....

. . . . .

(3) In lieu of costs under ch. 814, the court shall award litigation expenses to the condemnee if:

. . . . .

(d) The award of the condemnation commission under s. 32.05(9) or 32.06(8) exceeds the jurisdictional offer or the highest written offer prior to the jurisdictional offer by at least $700 and at least 15% and neither party appeals the award to the circuit court;

. . . . .

(Emphasis added.)

In sec. 32.28(3), Stats., the legislature authorized the "court" to award litigation expenses. However, sec....

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