Wis. Dep't of Workforce Dev. v. Wis. Labor & Indus. Review Comm'n
| Decision Date | 17 February 2016 |
| Docket Number | 2014AP2931,2014AP2929,Nos. 2014AP2928,2014AP2933.,2014AP2930,2014AP2932,s. 2014AP2928 |
| Citation | 367 Wis.2d 609,877 N.W.2d 620,2016 WI App 21 |
| Parties | WISCONSIN DEPARTMENT OF WORKFORCE DEVELOPMENT, Plaintiff–Appellant, v. WISCONSIN LABOR AND INDUSTRY REVIEW COMMISSION, William J. Hogan and First Student Management LLC, Defendants–Respondents. Wisconsin Department of Workforce Development, Plaintiff–Appellant, v. Wisconsin Labor and Industry Review Commission, Paul F. Baier and Weegan Landscape Inc., Defendants–Respondents. Wisconsin Department of Workforce Development, Plaintiff–Appellant, v. Wisconsin Labor and Industry Review Commission, Bret V. Maertz and Frontier Airlines Inc., Defendants–Respondents. Wisconsin Department of Workforce Development, Plaintiff–Appellant, v. Wisconsin Labor and Industry Review Commission, Gary D. Kluczynski, Dale D. Doberstein and Julie Doberstein, Defendants–Respondents. Wisconsin Department of Workforce Development, Plaintiff–Appellant, v. Wisconsin Labor and Industry Review Commission, Patrick C. VanEyck, Tidy View Dairy LLC and Locate Staffing Inc., Defendants–Respondents. Wisconsin Department of Workforce Development, Plaintiff–Appellant, v. Wisconsin Labor and Industry Review Commission, Mary B. Hembel and National Telecommuting Institute of Wisconsin Inc., Defendants–Respondents. |
| Court | Wisconsin Court of Appeals |
On behalf of the plaintiff-appellant Wisconsin Department of Workforce Development, the cause was submitted on the briefs of Daniel J. LaRocque and Andrew J. Rubsam of Bureau of Legal Affairs of Madison.
On behalf of the defendant-respondent Wisconsin Labor and Industry Review Commission, the cause was submitted on the brief of Jeffrey J. Shampo of Madison.
On behalf of the defendants-respondents William J. Hogan, Paul F. Baier, Gary D. Kluczynski, and Patrick C. VanEyck, the cause was submitted on the brief of Victor Forberger of Madison.
Before REILLY, P.J., GUNDRUM and HAGEDORN, JJ.
¶ 1 Wisconsin has a multi-layered appeals process for unemployment insurance awards. Benefit amounts and eligibility are initially determined by the Wisconsin Department of Workforce Development (DWD). See WIS. STAT. § § 108.03 & 108.09(2) (2013–14).1 Disputes over those awards then go to an administrative law judge who acts in a quasi-judicial role but is still employed by DWD. See § 108.09(3) –(4). Administrative law judge decisions are then appealed to an independent administrative agency—the Labor and Industry Review Commission (LIRC). See § 108.09(6). Following disposition by LIRC, any party can appeal by filing a case in circuit court. See WIS. STAT. § 102.23(1)(a).
¶ 2 This case involves an appeal by DWD to the circuit court contesting an award by LIRC of unemployment benefits for seven individuals. Despite only one of the individuals having a connection to Kenosha County, DWD brought all seven lawsuits there to seek unified judicial resolution of a particular and shared legal question.2 But substantive review never came. The circuit court dismissed the six actions with no connection to Kenosha County,3 concluding that DWD did not comply with WIS. STAT. § 102.23(1)(a) because it filed the cases in an improper venue. The court ruled that this defect compelled dismissal because it lacked the competency to proceed.
¶ 3 On appeal, DWD contends that any defect in venue did not impair the court's competency. DWD further argues that even if it did, the court still retained the power to transfer the cases or consolidate them into a single proceeding. We disagree and affirm the circuit court's actions in this case. We hold that the venue provision in WIS. STAT. § 102.23(1)(a) is central to the statutory scheme and did deprive the court of competency. The circuit court was further correct that the proper remedy was dismissal of the six improperly venued cases.
¶ 4 WISCONSIN STAT. § 102.23 sets out the procedure to obtain review of LIRC decisions regarding the award or denial of unemployment benefits. The text of § 102.23(1)(a) states that LIRC decisions are "subject to review only as provided in this section." Thus, the supreme court has recognized that this provision "defines the exclusive statutory scheme by which [a] party may file a summons and complaint in the circuit court." Xcel Energy Servs., Inc. v. LIRC, 2013 WI 64, ¶ 29, 349 Wis.2d 234, 833 N.W.2d 665.
¶ 5 The rules of civil procedure provide generally applicable rules regarding venue.4 However, WIS. STAT. § 102.23(1)(a) provides an exception to the generally applicable rules and prescribes as follows:
The proceedings shall be in the circuit court of the county where the plaintiff resides, except that if the plaintiff is a state agency, the proceedings shall be in the circuit court of the county where the defendant resides. The proceedings may be brought in any circuit court if all parties stipulate and that court agrees.
Sec. 102.23(1)(a). Thus, where the plaintiff is a state agency—as it is here—the action must be brought in the circuit court where the defendant resides unless all parties stipulate and the court agrees to another venue.
¶ 6 It is undisputed that the parties in this case did not stipulate to venue the case elsewhere.5 Therefore, the statute requires that each of these cases be brought in the venue where the defendant resides.6 However, only one of the seven actions was brought where a defendant resided. Unsurprisingly, procedural wrangling ensued.7 Following briefing and arguments, the circuit court concluded that because DWD did not file the cases where a defendant resided, and there were no stipulations to proceed elsewhere, venue was improper. It further held that the venue provision was central to the statutory scheme, rendering the court incompetent to proceed. Rejecting DWD's efforts to consolidate the cases nonetheless, the court held that the proper remedy was dismissal of the cases. DWD appeals this decision and order.
¶ 7 Whether a court possesses the competency to adjudicate a complaint is a question of law that we review de novo. Xcel, 349 Wis.2d 234, ¶ 24, 833 N.W.2d 665.
¶ 8 The central issue in this case is whether improper venue under WIS. STAT. § 102.23(1)(a) deprives the court of competency, and if so, what the proper remedy is. In fairness to the parties, the case law addressing competency and jurisdiction in Wisconsin is not a beacon of clarity.8 Though earlier cases used somewhat different categories, recent cases have outlined a legal disjuncture between subject matter jurisdiction and competency. Relying on the Wisconsin constitution,9 our supreme court has stated that circuit courts have jurisdiction to entertain any action, and such subject matter jurisdiction may not be curtailed by the legislature. Village of Trempealeau v. Mikrut, 2004 WI 79, ¶ 8, 273 Wis.2d 76, 681 N.W.2d 190. Even so, a circuit court may be deprived of the ability—or competency—to exercise that jurisdiction and "to render a valid order or judgment when the parties seeking judicial review fail to meet certain statutory requirements." Xcel, 349 Wis.2d 234, ¶ 28, 833 N.W.2d 665.
¶ 9 Although some cases have stated that strict compliance with statutory procedures is required,10 courts have created common law exceptions to strict compliance.11 Thus, courts have held that not every statutory defect deprives a court of competency; only when the mandate is "central to the statutory scheme" is a court deprived of the power to act. Id. This, of course, raises the question of what it means for something to be "central" to the scheme.
¶ 10 This test was first articulated in State v. Bollig, 222 Wis.2d 558, 567–68, 587 N.W.2d 908 (Ct.App.1998). In Bollig, we synthesized prior cases and explained that the question is "whether the legislative purpose of the statutory scheme could be fulfilled, without strictly following the statutory directive." Id. We further described this test as "very similar" to whether a personal jurisdiction defect is fundamental or technical. Id. at 568, 587 N.W.2d 908. The personal jurisdiction doctrinal framework is instructive.
¶ 11 In American Family Mutual Insurance Co. v. Royal Insurance Co. of America, 167 Wis.2d 524, 481 N.W.2d 629 (1992), the supreme court discussed two then-irreconcilable lines of cases regarding defects in a summons and complaint vis-à-vis personal jurisdiction. Id. at 530–34, 481 N.W.2d 629. One line of cases required strict statutory compliance, while another line of cases permitted technical errors so long as they did not prejudice a party. Id. at 530, 481 N.W.2d 629. The supreme court ultimately accepted a distinction between fundamental errors in the commencement of actions and those that are merely technical and can be remedied without prejudice to the complainant. Id. at 533, 481 N.W.2d 629. Personal jurisdiction exists only if an error is technical and the defendant was not prejudiced by the technical defect. Id. Thus, in that case, the court held that failing to file a summons and complaint naming the defendant, failing to authenticate the served copy, and failing to serve within sixty days of filing as specified in WIS. STAT. § 801.02(1) all constitute fundamental defects. American Family, 167 Wis.2d at 533–34, 481 N.W.2d 629. In contrast, a clerk's error in stamping the wrong case number is merely a technical defect that can be cured, particularly since that duty "is beyond the control of the complainant." Id. at 534, 481 N.W.2d 629. Numerous cases have used and applied the American Family test in the context of personal jurisdiction.12
¶ 12 The personal jurisdiction analytical framework is helpful here. Statutes are intended to be obeyed as written. The procedural and substantive policy choices reflected in statutory schemes may not be simply overlooked. Yet minor, nonprejudicial deviations from statutory requirements may be...
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