Wisconsin Veterans Home v. Division of Nursing Home Forfeiture Appeals

• Decision Date: 25 August 1981
• Docket Number: No. 80-1752,80-1752
• Citation: 104 Wis.2d 106,310 N.W.2d 646
• Parties: WISCONSIN VETERANS HOME, an agency of the Wisconsin Department of Veterans Affairs, Petitioner-Appellant, v. DIVISION OF NURSING HOME FORFEITURE APPEALS, Respondent.
• Court: Wisconsin Court of Appeals

Page 646

310 N.W.2d 646

104 Wis.2d 106

WISCONSIN VETERANS HOME, an agency of the Wisconsin Department of Veterans Affairs, Petitioner-Appellant, v. DIVISION OF NURSING HOME FORFEITURE APPEALS, Respondent.

No. 80-1752.

Court of Appeals of Wisconsin.

Argued April 30, 1981.

Opinion Released Aug. 25, 1981.

Opinion Filed Aug. 25, 1981.

Review Granted. ^*

Roy G. Mita, Asst. Atty. Gen. (argued), for petitioner-appellant; Bronson C. La Follette, Atty. Gen. and Roy G. Mita, Asst. Atty. Gen., on brief.

Teresa Elguezabal, Madison (argued), for respondent; Brady C. Williamson and Teresa M. Elguezabal and La Follette, Sinykin, Anderson & Munson, Madison, on brief.

GARTZKE, Presiding Judge, and BABLITCH and DYKMAN, JJ.

DYKMAN, Judge.

The State of Wisconsin seeks judicial review of a forfeiture which it imposed on itself for having an insufficient number of activities therapists at its veterans home at King. To litigate this matter against itself, the state hired a private law firm to defend the imposition of the forfeiture and required the attorney general to oppose it. We hold that the statute under which the forfeiture was imposed does not apply to the state, and therefore reverse the circuit court's order affirming its imposition.

The Department of Veterans Affairs (DVA) operates the Wisconsin Veterans Home (home). Sec. 45.365, Stats. The parties agree that the home falls within the definition of a nursing home in sec. 50.01(3), Stats. Nursing homes in Wisconsin are licensed and regulated by the Department of Health and Social Services (DH&SS). Sec. 50.02. The home is licensed pursuant to ch. 50.

In February 1975, DH&SS indicated that the home had failed to comply with a regulation requiring "an equivalent of 2 hours of activity staff time per patient per month." Sec. H 32.24(1)(a), Wis.Adm.Code. The home was unable to meet the requirement because it had only four fulltime activities therapists. Similar violations were noted in December 1976 and February 1978. An occupational therapy consultant for DH&SS found on the latter occasion that four more activities therapists were needed to correct the deficiency.

Neither the home nor DVA have authority to create the new employee positions found necessary by DH&SS. The home asked the legislature for additional staff for that purpose in its budget requests for 1973-75 and 1977-79, but the requests were denied. Temporary therapists were hired under the Comprehensive Employment and Training Act (CETA) from February 1975 through the end of 1977, but the number of CETA employees made available for that purpose was reduced from six to two during that period. A request for six CETA therapy assistants in May 1978 was denied by the state's Department of Administration.

On June 27, 1978, DH&SS served the home with notice of violation for failing to provide sufficient activities staff to meet the requirements of sec. H 32.24(1)(a), Wis.Adm.Code. Sec. 50.04(4)(a), Stats. On July 28, 1978, DH&SS assessed a forfeiture against the home pursuant to sec. 50.04(5) in the amount of $3,900 for the period of June 27 to July 27, 1978. The factors listed in sec. 50.04(5)(b) ¹ were considered by DH&SS in determining the need for and the amount of the forfeiture.

On August 10, 1978, the home asked the legislature's Joint Committee on Finance to authorize it to hire four more activities therapists. That request was denied.

The home then appealed the forfeiture assessment to DH&SS's Division of Nursing Home Forfeiture Appeals (division). A hearing was held November 13, 1978. The division agreed with DH&SS that the home could have taken other action, primarily involving the redeployment or reallocation of personnel to fill the needed positions, to meet the requirements of sec. H 32.24(1)(a), Wis.Adm.Code. The division accordingly affirmed the imposition of the forfeiture.

The home petitioned the circuit court for review of the division's decision. The court affirmed the division. The home appeals from the circuit court's judgment.

The home raises two issues on appeal:

1. Is the home subject to the forfeiture provisions of sec. 50.04(5), Stats.?

2. Are the DH&SS findings which led to imposition of the forfeiture sustained by the evidence?

Because we hold that a forfeiture cannot be assessed against the home, we do not reach the second question.

The division contends that ch. 50, Stats., governing the licensing and regulation of nursing homes by DH&SS, applies in its entirety to the home. The home agrees that the licensing and regulatory aspects of ch. 50 apply to it, but argues that the forfeiture provisions do not.

In support of its contention, the home cites a rule of statutory construction which is most clearly articulated in 3 Sands, Statutes and Statutory Construction sec. 62.01 at 63 (4th ed. 1974):

Statutory provisions which are written in such general language as to make them reasonably susceptible to being construed as applicable alike both to the government and to private parties are subject to a presumptive rule of construction which exempts the government from their operation in the absence of other particular indicia supporting a contrary result in particular instances.

This rule has long been followed in Wisconsin. See, e. g., State ex rel. Dept. of Pub. Instruction v. ILHR, 68 Wis.2d 677, 680-81, 229 N.W.2d 591, 593-94 (1975); Door County v. Plumbers Local No. 298, 4 Wis.2d 142, 150, 89 N.W.2d 920, 924 (1958), rev'd on other grounds, 359 U.S. 354, 79 S.Ct. 844, 3 L.Ed.2d 872 (1959); State ex rel. Martin v. Reis, 230 Wis. 683, 687, 284 N.W. 580, 582 (1939).

The division contends that this rule applies only when it is necessary to construe an ambiguous statute. It argues that ch. 50, Stats., unambiguously applies to the state because of the broad definition of nursing home found in sec. 50.01(3). That definition provides that "nursing home" means:

(a) A place which provides 24-hour services including board and room to 3 or more unrelated residents who because of their mental or physical condition require nursing care or personal care in excess of 7 hours a week, unless the facility has been designated as a community-based residential facility under sub. (1).

If the state were included in this definition by plain language, resort to a rule of statutory construction would indeed be unnecessary. 3 Sands, supra, sec. 62.02 at 72. The definition is, however, written in general language that could apply to both the state and to private parties. It does not specifically include state-run nursing homes within its ambit. Resort to the rule of strict construction against including the state within the statute's reach is therefore appropriate. Neither Sands' treatise nor the Wisconsin cases applying this rule require any further finding of ambiguity before reliance on the rule is proper.

Because the home concedes that it is subject to the licensing and regulatory aspects of ch. 50, Stats., we need not address that issue further. The question becomes whether the home is subject to the forfeiture provisions of ch. 50. We conclude that that was not the legislature's intent.

There is good reason to apply the rule of strict construction with regard to the forfeiture provisions of ch. 50, Stats. That rule of construction is given its strongest force when the state would be included in a law "to its hurt"; that is when the law would "tend to restrain or diminish any of (the state's) rights and interests." Necedah Mfg. Corp. v. Juneau County, 206 Wis. 316, 322, 237 N.W. 277, 279 (1932). See also Plumbers Local No. 298, 4 Wis.2d at 150, 89 N.W.2d at 924. The home, and thus the state, is hurt when it is required to forfeit money which it had allocated to other purposes. Forfeitures are a reasonable way of assuring that private nursing homes will comply with the law. The forfeitures reduce the profitability of a private enterprise, providing an incentive to abide by the law. The home, however, makes no profit, and is dependent upon the legislature for whatever funds it receives. Any forfeiture it pays comes not from profits, but from monies that would have been spent elsewhere in the home's attempt to provide services.

The home's situation is similar to the situation discussed in 30 Op. Att'y Gen. 69 (1941), where the question was whether a judgment against a town was collectible under a particular quasi-garnishment statute. ² The opinion recognized the general rule that "a statute of general application, no matter how inclusive its terms, will not be construed to apply to the government or its agencies if such construction would impair their rights or interests,...