Vivid, Inc. v. Fiedler

• Decision Date: 16 March 1994
• Docket Number: No. 90-2787,90-2787
• Citation: 512 N.W.2d 771,182 Wis.2d 71
• Parties: VIVID, INC., a Wisconsin Corporation, Plaintiff-Appellant, v. Ronald R. FIEDLER, Secretary of the Wisconsin Department of Transportation, and the Wisconsin Department of Transportation, Defendants-Respondents-Petitioners.
• Court: Wisconsin Supreme Court

Page 771

512 N.W.2d 771

182 Wis.2d 71

VIVID, INC., a Wisconsin Corporation, Plaintiff-Appellant, v. Ronald R. FIEDLER, Secretary of the Wisconsin Department of Transportation, and the Wisconsin Department of Transportation Defendants-Respondents-Petitioners.

No. 90-2787.

Supreme Court of Wisconsin.

Argued Nov. 29, 1993.

Decided March 16, 1994.

For the plaintiff-appellant there was a brief by Thomas S. Hornig, Marc T. McCrory, and Brennan, Steil, Basting & MacDougall, S.C., Janesville, and oral argument by Thomas S. Hornig.

Amicus curiae brief was filed by Thomas M. Olejniczak, Susan A. Wegner and Liebmann, Conway, Olejniczak & Jerry, S.C., Green Bay, for the Outdoor Advertising Ass'n of Wisconsin.

Amicus curiae brief was filed by Eric M. Rubin, Walter E. Diercks, Darrin N. Sacks and Rubin, Winston, Diercks, Harris & Cooke, Washington, DC, and of counsel Thomas M. Olejniczak, Susan A. Wegner and Liebmann, Conway, Olejniczak & Jerry, S.C., Green Bay, for the Outdoor Advertising Ass'n of America, Inc.

HEFFERNAN, Chief Justice.

This is a review of a published decision of the court of appeals, Vivid, Inc. v. Fiedler, 174 Wis.2d 142, 497 N.W.2d 153 (Ct.App.1993), reversing a summary judgment of the Rock County Circuit Court dismissing Vivid's petition to institute condemnation proceedings. The issue we address on this appeal is whether sec. 84.30(6), Stats., ¹ requires payment of just compensation for signs that the DOT required Vivid to remove in the course of a highway expansion project. We conclude that sec. 84.30(6) requires payment of just compensation because Vivid meets both of the statutory criteria--the signs were not in conformity with sec. 84.30 and they were lawfully in existence on March 18, 1972. Therefore, we affirm the decision of the court of appeals with the modification that the cause be remanded to the circuit court for a determination of the amount of just compensation that the DOT must pay to Vivid.

Vivid owned two billboards that were located south of the point at which Avalon Road intersects Interstate 90 near Janesville, Wisconsin. The sign to the west of I-90 was visible to southbound traffic, while the sign to the east of I-90 was visible to northbound traffic. One sign was erected on or before 1965, while the other was erected in April of 1966. Both signs were within 660 feet of the nearest edge of the I-90 right-of-way.

In a letter dated September 10, 1987, the DOT informed Vivid that it was planning to improve state trunk highway 351 (Avalon Road) and that Vivid's property would be "affected" by this project. Apparently to make improvements to the Avalon Road interchange at I-90, the DOT needed to enlarge the right-of-way for I-90 and the Avalon Road entrance and exit ramps. In a second letter dated March 7, 1988, the DOT informed Vivid that it was in the process of acquiring the land on which Vivid's signs were located. The DOT stated that Vivid would need to relocate its signs.

Following the procedure set forth in sec. 32.05, Stats., which governs condemnation for transportation facilities, the DOT acquired the two parcels of land on which Vivid's signs were located. ² The DOT then sent Vivid a notice of order for removal, dated December 19, 1988, informing Vivid that the signs had to be removed by March 31, 1989. ³

The notice also discussed the compensation the DOT considered applicable. It was the DOT's position that the signs were Vivid's personal property and could be moved to another permitted location within the market area. According to the DOT, under sec. 32.19(3)(a), Stats., which governs payment of moving expenses for personal property in condemnation proceedings, Vivid was entitled to reimbursement for reasonable expenses incurred to search for a new site and to move the signs. The DOT added that if Vivid could show that the signs could not be moved, then Vivid could be reimbursed for the actual, direct loss of tangible personal property. Finally, the DOT stated that in order to receive payment, Vivid should file a claim under sec. 32.20, Stats., which sets forth a procedure for collection of damages itemized in sec. 32.19.

Disagreeing with the DOT's interpretation of the compensation to which it was entitled, Vivid filed a petition to institute condemnation proceedings on October 17, 1989, a process which is better known as inverse condemnation. Vivid alleged that removal of the billboards was a "taking" that required just compensation. The circuit court granted summary judgment to the DOT.

The court of appeals reversed, holding that under article I, section 13 of the Wisconsin Constitution, outdoor advertising signs are "property" which may not be taken for public use without just compensation. The court added that, because the DOT had not provided just compensation, Vivid was entitled to maintain an inverse condemnation proceeding under sec. 32.10.

Vivid argues that it is entitled to just compensation on several different grounds. Without reaching the other arguments, we conclude that sec. 84.30(6) requires that the DOT pay Vivid just compensation. ⁴ Because the Wisconsin legislature passed sec. 84.30, Stats., to comply with the requirements of a federal statute, 23 U.S.C. § 131, we begin by analyzing the relationship between these two statutes. The federal Highway Beautification Act, 23 U.S.C. § 131, established incentives for states to control billboards along federal interstate and primary highways. The express purposes of the statute are "to protect the public investment in such highways, to promote the safety and recreational value of public travel, and to preserve natural beauty." 23 U.S.C. § 131(a). To achieve these purposes, states are asked to make "provision for effective control of the erection and maintenance along the Interstate System and the primary system of outdoor advertising signs, displays, and devices". 23 U.S.C. § 131(b).

The statute adds that the provision for "effective control" must apply to two groups of signs: after January 1, 1968, it applies to signs that are within 660 feet of the nearest edge of the right-of-way and visible from the main traveled way of the system; after January 1, 1975, it applies to signs that are more than 660 feet away, located outside urban areas, visible from the main traveled way and erected with the purpose of having their message read from the main traveled way. Id. If the Secretary of the U.S. Department of Transportation determines that a state has not made the necessary provision for "effective control" of billboards, that state's federal-aid highway funds are reduced by ten percent until such time as the state does make such provision. Id.

Next, 23 U.S.C. § 131(c) defines "effective control" to inform states of the specific limitations they are expected to put in place. "Effective control" means that within the distances set forth above, only the following signs can be displayed: directional and official signs; signs advertising sale or lease of property on which they are located; signs advertising activities conducted on the property on which they are located; landmark signs such as those of historic or artistic significance; signs advertising free coffee. 23 U.S.C. § 131(c). Vivid's signs do not fit within any of these exceptions. Thus, the signs are nonconforming under the federal statute.

The federal statute also makes provision for payment of just compensation, stating in relevant part:

Just compensation shall be paid upon the removal of any outdoor advertising sign, display, or device lawfully erected under State law and not permitted under subsection (c) of this section, whether or not removed pursuant to or because of this section.

23 U.S.C. § 131(g) (emphasis added). The italicized portion of subsection (g) was added to this statute by an amendment passed in 1978. ⁵ Surface Transportation Assistance Act of 1978, Pub.L. 95-599, § 122(a), 92 Stat. 2689, 2701 (1978). Payment of this statutory just compensation is part of the "effective control" which states must provide in order to avoid the ten percent reduction in federal highway funds. National Advertising Co. v. City of Ashland, 678 F.2d 106, 108 (9th Cir.1982); City of Fort Collins v. Root Outdoor Advertising, Inc., 788 P.2d 149, 154 (Colo.1990).

In 1971, the Wisconsin legislature passed sec. 84.30, Stats., to comply with the requirements of 23 U.S.C. § 131. Sec. 84.30(1) states that one of the purposes of the statute is "to conform to the expressed intent of congress to control the erection and maintenance of outdoor advertising signs, displays and devices adjacent to the national system of interstate and defense highways". The relevant provisions of sec. 84.30, while not identical to those of 23 U.S.C. § 131, closely parallel the federal statute. Sec. 84.30(3) prohibits erection or maintenance of any sign "visible from the main-traveled way of any interstate or federal-aid highway", except the following: (a) directional or other official signs; (b) signs advertising sale or lease of property upon which they are located; (c) signs advertising activities conducted on the property on which they are located; (d) signs located in business areas on March 18, 1972; (e) signs erected in business areas subsequent to March 18, 1972, which will comply with 84.30(4); (f) signs located in urban areas outside the adjacent area ⁶; (g) landmark signs; (h) signs outside the adjacent area not erected for the purpose of being read from the main traveled way; (i) signs on farm buildings that promote a Wisconsin agricultural product. ⁷ Vivid's signs are nonconforming under sec. 84.30 because they do not fit within any of these categories.

Section 84.30 also contains a just compensation provision that parallels that contained in 23 U.S.C. § 131(g). Sec. 84.30 provides:

(6) Just Compensation. The department shall pay just compensation upon the removal or relocation on or after March 18, 1972, of any of the following signs which are...