author: DEININGER, PJ.

text:
    State of Wisconsin ex rel. Nathaniel Allen Lindell, Petitioner-Appellant, v. Jon E. Litscher, Gerald Berge and Laurie Voigt, Respondents-Respondents.
    Court of Appeals

      No. 03-2477.

      Submitted on briefs August 5, 2004.

    Decided February 17, 2005.

    2005 WI App 39
    (Also reported in 694 N.W.2d 396.)

      On behalf of the petitioner-appellant, the cause was submitted on the brief of Nathaniel A. Lindell, pro se.

    On behalf of the respondents-respondents, the cause was submitted on the brief of Karla Z. Keckhaver, assistant attorney general, and Peggy A. Lauten-schlager, attorney general.
    Before Deininger, PJ., Dykman and Vergeront, JJ.
   DEININGER, PJ.

¶ 1. Nathaniel Lindell appeals an order that (1) dismissed his mandamus action; (2) denied him leave to amend his mandamus petition to seek additional relief; and (3) declared the instant action a "strike" under Wis. Stat. § 801.02(7) (2003-04). Lindell claims the circuit court erred in each of these actions and by failing to impose sanctions against respondents' counsel for submitting an allegedly frivolous objection to his proposed amended complaint.

¶ 2. We conclude that the court did not err in dismissing the mandamus action because it became moot when Department of Corrections (DOC) officials took the actions Lindell demanded shortly after the action was filed. We also conclude that the circuit court correctly interpreted the Wisconsin Prisoner Litigation Reform Act (WPLRA) as permitting it to deny Lindell leave to amend his initial pleading, and further, that the court did not err in denying leave. We conclude, however, that the dismissal of Lindell's mandamus action should not be declared a "strike" because Lindell's petition had arguable merit when he filed it. Finally, we deny Lindell's request that we direct the circuit court to sanction respondents' counsel. Accordingly, we modify the appealed order to delete the declaration that the dismissal constitutes a strike under Wis. Stat. § 801.02(7)(d). We affirm the order as modified.

BACKGROUND

¶ 3. Nathaniel Lindell is a prison inmate and the respondents are officials or employees of the DOC. When the La Crosse County circuit court sentenced Lindell in 1998, the court determined that no restitution would be ordered in his case, but it later mistakenly signed an order obligating Lindell to pay over $100,000 in restitution. Respondent Voigt forwarded the restitution order to the prison where Lindell was incarcerated, asking that payments toward restitution be deducted from his prison account. Payments totaling $12.26 were deducted from Lindell's account in 2000 and 2001 before he was transferred to another prison, where, for reasons not apparent in the record, no further deductions for restitution were made from Lindell's account.

¶ 4. Meanwhile, after the sentencing court became aware of the erroneously issued restitution order, it issued an amended order on January 29, 2002, which extinguished Lindell's restitution obligation. This fact was not communicated to prison officials, however. Lindell submitted a petition for a writ of mandamus to the Dane County circuit court in October 2002. After several exchanges of correspondence between the court and Lindell, the court accepted Lindell's petition for filing without the prepayment of filing fees on March 28, 2003. In an order entered the same day, the court directed the respondents to inform the court within forty-five days "as to why an order should not be issued prohibiting prison officials from withdrawing funds from [Lindell]'s account for restitution and ordering reimbursement of funds wrongfully withdrawn from petitioner's account."

¶ 5. Shortly after a response to Lindell's mandamus petition was ordered, Lindell provided the prison business office documentation verifying that the La Crosse County circuit court had rescinded its order for restitution. Business office personnel then deactivated Lindell's restitution obligation and payments. On May 6, 2003, the DOC restored the previously deducted $12.26 to Lindell's account. Lindell then filed a "Second Amended Complaint Under 42 U.S.C. § 1983 with Pendant Petition for Mandamus/Prohibition, Replevin and Declaratory Judgement Claims." This document, filed on May 15, 2003, sought the following relief: a writ of mandamus requiring respondents "to comply with their legal duties" and a writ of prohibition prohibiting them "from continuing their illegal taking of money from Lindell"; a declaration that respondents have violated Lindell's rights and certain laws "by their ... deliberate omissions"; and compensatory and punitive damages for these violations, together with the costs of pursuing the action.

¶ 6. The respondents responded to the original mandamus petition, citing the facts noted above, and they objected to Lindell's proposed amended complaint. The circuit court determined that, because Lindell is a prisoner, his proposed amended complaint was subject to the WPLRA requirement that the circuit court screen all initial pleadings to determine if they present arguably meritorious claims. See Wis. Stat. § 802.05(3). The court proceeded to consider both the merits of the mandamus petition and whether the amended complaint should be permitted. The court ultimately dismissed the mandamus action and denied Lindell's motion to amend his pleadings, determining that his new claims were without arguable merit. Finally, the court declared the dismissed of the action to be a "strike" for purposes of Wis. Stat. § 801.02(7) (d). Lindell appeals.

ANALYSIS

Mandamus

¶ 7. Lindell first argues that the circuit court erred in dismissing his mandamus action. We review the court's decision to issue or deny a writ of mandamus for an erroneous exercise of discretion. Morrissette v. DeZonia, 63 Wis. 2d 429, 434, 217 N.W.2d 377 (1974). We will affirm a circuit court's exercise of discretion "if the record shows that the court correctly applied the legal standards to the facts and reached a reasoned conclusion." State v. Nawrocke, 193 Wis. 2d 373, 381, 534 N.W.2d 624 (Ct. App. 1995).

¶ 8. We conclude that the circuit court did not err in dismissing Lindell's mandamus action. We first note that a petitioner requesting a writ of mandamus must demonstrate that the respondents have failed to fulfill a positive and plain duty. Pasko v. City of Milwaukee, 2002 WI 33, ¶ 24, 252 Wis. 2d 1, 643 N.W.2d 72. Until the sentencing court issued its revised restitution order and prison officials received verification of that fact, they had no positive and plain duty to cease withholding money from Lindell's account or to refund the money they had deducted. More important, however, is the fact that, by the time the respondents responded to and the court considered the merits of Lindell's mandamus petition, the DOC had ceased deducting money from Lindell's prison account and had refunded him the $12.26 initially deducted. These developments rendered moot the relief Lindell sought in his initial petition (see footnote 2). See State ex rel. Renner v. DHSS, Correctional Div., 71 Wis. 2d 112, 116, 237 N.W.2d 699 (1976) (holding that a cause of action becomes moot when the petitioner receives the requested relief).

The Proposed Amended Complaint and the WPLRA

¶ 9. Lindell next argues that the circuit court erred in subjecting his proposed amended complaint to the requirements of Wis. Stat. § 802.05(3). That section provides as follows:

(3) (a) A court shall review the initial pleading as soon as practicable after the action or special proceeding is filed with the court if the action or special proceeding is commenced by a prisoner, as defined in s. 801.02 (7)(a) 2.
(b) The court may dismiss the action or special proceeding under par. (a) without requiring the defendant to answer the pleading if the court determines that the action or special proceeding meets any of the following conditions:
1. Is frivolous, as determined under s. 814.025 (3).
2. Is used for any improper purpose, such as to harass, to cause unnecessary delay or to needlessly increase the cost of litigation.
3. Seeks monetary damages from a defendant who is immune from such relief.
4. Fails to state a claim upon which relief may be granted.

Lindell points out that the statute applies to only an "initial pleading." He relies on Wis. Stat. § 802.09(1) ("A party may amend the party's pleading once as a matter of course at any time within 6 months after the summons and complaint are filed or within the time set in a scheduling order....") to argue that he should have been permitted to file his amended complaint without judicial scrutiny.

¶ 10. Our resolution of this issue requires that we interpret the above-cited statutes. A question of law is thus presented, which we decide de novo. See State v. Setagord, 211 Wis. 2d 397, 405-06, 565 N.W.2d 506 (1997). We begin with the language of the statute, and if that yields a plain meaning, we apply that meaning. State ex rel. Kalal v. Circuit Court for Dane County, 2004 WI 58, ¶ 46, 271 Wis. 2d 633, 681 N.W.2d 110. We interpret statutory language in the context in which it is used, not in isolation, but as part of a whole, in relation to the language of surrounding or closely related statutes, and reasonably to avoid absurd or unreasonable results. Id. We also consider the scope, context, and purpose of the statute insofar as they are ascertainable from the text and structure of the statute itself. Id., ¶ 48.

¶ 11. The dispositive question is, when a "prisoner" attempts to amend his or her "initial pleading" within six months of filing an action, which statute governs — Wis. Stat. § 802.05(3), which subjects all initial pleadings by a prisoner to judicial scrutiny and, potentially, to peremptory, sua sponte dismissal; or Wis. Stat. § 802.09(1), which permits a "party" to amend a "party's pleading once as a matter of course"? We conclude that it is the former that controls, and our conclusion derives from the language of the statutes at issue and closely related statutes, the purpose of the WPLRA as derived from its text and structure, and the requirement that we read statutory language reasonably to avoid absurd or unreasonable results. See Kalal, 271 Wis. 2d 633, ¶¶ 46, 48-49. Put another way, because the proper interpretation may be ascertained from the text, structure and context of the statutes themselves, we need not (and may not) consult extrinsic sources to determine the legislature's intent, except perhaps to confirm our understanding derived from the statutory language itself. See id., ¶ 51.

¶ 12. We note first that the amendment provisions of Wis. Stat. § 802.09 apply generally to "part[ies]" to civil proceedings and to their unspecified "pleading[s]." The judicial prescreening requirement under Wis. Stat. § 802.05(3), however, relates specifically to the "initial pleading" of a "prisoner." The language chosen by the legislature in § 802.05(3) evinces its intent that, unlike the initial pleadings that other plaintiffs or petitioners may file to commence actions and define their scope, a prisoner's complaint or petition is subject to judicial scrutiny and possible summary dismissal. See § 802.05(3)(b); see also State ex rel. Schatz v. McCaughtry, 2003 WI 80, 263 Wis. 2d 83, 664 N.W.2d 596. Not only is it reasonable to read the more specific language governing prisoners' initial pleadings as overriding the provisions of § 802.09 dealing with the amendment of pleadings in general, see Gottsacker Real Estate Co., Inc. v. DOT, Div. of Highways, 121 Wis. 2d 264, 269, 359 N.W.2d 164 (Ct. App. 1984), but a contrary conclusion would also lead to an unreasonable result. See Kalal, 271 Wis. 2d 633, ¶ 46.

¶ 13. The WPLRA imposes special restraints and requirements on prisoners' initial pleadings that do not apply to pleadings filed by other plaintiffs. For example, in addition to the preliminary judicial screening of an initial pleading for arguable merit, a prisoner's complaint or petition must be accompanied by "documentation showing that he or she has exhausted all available administrative remedies." Wis. Stat. § 801.02(7)(c). If a prisoner accumulates three dismissals for unjustified or frivolous litigation ("strikes") under Wis. Stat. § 801.02(3) (b), that prisoner may not file a subsequent action without full prepayment of the filing fee, despite the prisoner's indigent status, unless a court determines "that the prisoner is in imminent danger of serious physical injury." Wis. Stat. § 801.02(7)(d).

¶ 14. The text of these closely related statutes plainly demonstrates a legislative purpose to treat prisoners' initial pleadings differently, subjecting them to requirements and potential sanctions not faced by other plaintiffs and petitioners. If prisoners were allowed to freely amend their petitions or complaints within six months of filing them, as Lindell contends, they would be able to completely circumvent the legislatively mandated judicial screening requirement. A prisoner would need only to allege an arguably meritorious claim, as Lindell did here, and once the action was permitted to continue, he or she could file an amended initial pleading containing all manner of frivolous or improperly pled claims.

¶ 15. The textually manifest purpose of the cited provisions and others in the WPLRA is to reduce the amount of frivolous prisoner lawsuits and to limit "prisoner litigation at taxpayers' expense." See State ex rel. Cramer v. Court of Appeals, 2000 WI 86, ¶¶ 38-40, 236 Wis. 2d 473, 613 N.W.2d 39. The supreme court has specifically explained the purpose of the judicial screening requirement under Wis. Stat. § 802.05(3):

The [WJPLRA was designed to address the costly problems caused by excessive or otherwise inappropriate prisoner-initiated litigation. The objectives of the [W]PLRA include enhancing judicial economy, protecting defendants from needlessly expending resources to defend this type of litigation, and reducing the taxpayer expense associated with such litigation ....
The initial pleading review procedure advances these objectives by permitting circuit courts to dispose of a prisoner lawsuit at the initial pleading stage of the suit if the circuit court determines that the lawsuit is frivolous, is being used for an improper purpose, seeks monetary damages from a defendant who is immune from such relief, or fails to state a claim upon which relief may be granted.

Schatz, 263 Wis. 2d 83, ¶¶ 15-16 (citation omitted). Permitting a prisoner to amend his or her initial pleading "as a matter of course" would plainly contravene these legislative objectives, producing an unreasonable result.

¶ 16. We thus conclude that, in order to avoid the unreasonable result of permitting prisoners to easily avoid the judicial screening requirement that is central to the purpose of the WPLRA, prisoners may not amend their initial pleadings "as a matter of course" within six months of filing, notwithstanding the provisions of Wis. Stat. § 802.09(1). Rather, a prisoner's proposed amendment of his or her initial pleading is subject to the judicial screening requirement of Wis. Stat. § 802.05(3), and a court must review the proposed amended pleading in accordance with that subsection before granting the prisoner leave to amend. If the court concludes that the proposed amended pleading meets any of the conditions set forth in § 802.05(3)(b), leave to amend must be denied.

¶ 17. Accordingly, the circuit court did not err in subjecting Lindell's proposed amended complaint to judicial scrutiny under Wis. Stat. § 802.05(3). We must next determine whether it also correctly concluded that the proposed amended complaint suffered from one or more of the infirmities described in § 802.05(3)(b), and for that reason, denied leave to amend. We conclude the court did not err in doing so.

¶ 18. Lindell's proposed amended complaint recites the basic facts of the DOC's allegedly wrongful withdrawal of money from his prison account and restates his demands for the return of the sum deducted and for an order directing DOC officials to refrain from deducting restitution payments in the future. The balance of the thirteen-page, seventy-two-paragraph pleading weaves these basic facts into various claims that the respondents violated numerous criminal statutes, deprived him of several constitutional rights and deliberately denied him redress of his legitimate grievance.

¶ 19. As we have noted, however, the proposed amended complaint was filed on May 15, 2003, and by then, the DOC had terminated the restitution deductions and refunded the $12.26 it previously deducted from Lindell's account. We note further that the administrative remedy exhaustion documentation that Lin-dell submitted with his initial petition shows that Lindell's inmate complaints regarding the wrongful restitution deductions were denied in October 2000 and January 2002. Both denials occurred before the La Crosse County circuit court had issued its January 29, 2002, corrected restitution order. The Institution Complaint Examiner's Report of October 4, 2000, includes the following summary and advice to Lindell:

It is clear from the documents provided that the Business Office received documentation that this inmate owed $117,594.16 for restitution in case 97 CF 140. It is equally clear that this inmate believes that restitution was not ordered. Several staff members ... have responded to this inmate and indicated that he has not supplied any evidence to verify that he does not owe the money. It appears this inmate's argument is with the court that ordered the restitution and that he should take this matter up with that court.
Staff at WCI are acting appropriately when deducting for this restitution and are in compliance with the documentation they have been supplied.

Thus, it is clear from the record that Lindell was informed over two years before the filing of his proposed amended complaint that the DOC was deducting restitution pursuant to an order from the La Crosse County circuit court, and that, if the order was erroneous, it was his responsibility to obtain a corrected court order and provide proof of it to the prison business office.

¶ 20. We concur, therefore, with the circuit court's observations when it denied Lindell leave to amend his initial pleading:

[Any harm suffered by Lindell] was not caused by these respondents. It was created by an erroneous Circuit Court order which has since been corrected .... Objections as to respondents^] actions to [the erroneous order] do not constitute any basis for a lawsuit since they were simply following the sentencing Court Orders as they received them. They could not independently determine the propriety of the restitution Order, and they could not reverse the dictates of the original Order absent receipt of a corrective Order ....
Not only should [Lindell] be precluded from amending his pleadings so as to expand this lawsuit, he also should be grateful that he is not being forced to defend against a frivolous action claim. Lawsuits such as this one were the impetus behind the enactment of statutory restrictions placed on inmate litigation.

In short, because, at a minimum, Lindell's proposed amended complaint would have "needlessly increase [d] the cost of litigation," Wis. Stat. § 802.05(3)(b)4., and was, moreover, arguably frivolous, § 802.05(3)(b)l., the circuit court did not err in denying Lindell leave to amend.

Strike under Wis. Stat. § 801.02(7)(d)

¶ 21. Lindell argues that the circuit court erred in declaring the dismissal of his mandamus action a "strike" for purposes of Wis. Stat. § 801.02(7)(d), which provides as follows:

If the prisoner seeks leave to proceed without giving security for costs or without the payment of any service or fee under s. 814.29, the court shall dismiss any action or special proceeding, including a petition for a common law writ of certiorari, commenced by any prisoner if that prisoner has, on 3 or more prior occasions, while he or she was incarcerated, imprisoned, confined or detained in a jail or prison, brought an appeal, writ of error, action or special proceeding, including a petition for a common law writ of certiorari, that was dismissed by a state or federal court for any of the reasons listed in s. 802.05(3)(b)l. to 4. The court may permit a prisoner to commence the action or special proceeding, notwithstanding this paragraph, if the court determines that the prisoner is in imminent danger of serious physical injury.

(Emphasis added.) We agree with Lihdell that the circuit court should not have declared its dismissal of the mandamus action a strike.

¶ 22. We have concluded that Lindell's proposed amended complaint met one or more of the conditions specified in Wis. Stat. § 802.05(3)(b), and thus, had it been filed as his initial pleading and dismissed under that subsection, the circuit court would have been correct in declaring the instant action a "strike" under Wis. Stat. § 801.02(7)(d). The proposed amended complaint, however, is not the focus of our present inquiry. Rather, we consider the reason for the dismissal of Lindell's original mandamus petition. Because we affirm the dismissal of Lindell's initial mandamus petition for mootness, which is a reason other than those set forth in § 802.05(3) (b), we conclude that the circuit court erred in declaring the dismissal of this action a strike.

¶ 23. In order to determine whether Lindell's mandamus petition was subject to dismissal for "any of the reasons listed in s. 802.05(3)(b)l. to 4.," thus qualifying this action as a strike under Wis. Stat. § 801.02(7)(d), we review the circumstances as they existed at the time Lindell filed his original petition. When Lindell first submitted his mandamus petition, the circuit court notified him by letter dated October 22, 2002, that the petition did not appear to "present a valid claim for a writ of mandamus" because Lindell's petition did not demonstrate that the respondents had a plain and positive duty to ensure the correctness of the La Crosse County circuit court's initial restitution order. Lindell was given thirty days to respond with additional information demonstrating why his action should not be dismissed. After reviewing Lindell's response, the Dane County Prisoner Litigation staff attorney informed Lindell that the court

still does not believe you have stated a potentially meritorious writ of mandamus claim ... because it is simply not the respondents' duty to verify the validity of the restitution order. They merely receive and process the paperwork they receive. If the order is truly improper, you must seek relief from La Crosse County.

Lindell was given an additional thirty days to submit additional information.

¶ 24. He then submitted an excerpt from the State's brief in his criminal appeal, where Lindell had complained, among other things, about the erroneous restitution order. The State's brief said this about the issue:

In his brief to [the court of appeals], Lindell argues that the trial court should have vacated the restitution order which was mistakenly placed in his record .... Both the trial court judge and the district attorney agreed that there should have been no order of restitution in Lindell's case.... The confusion apparently arose because his brother Joshua's case did have an order of restitution on a joint and several basis. Lindell's complaint is that the institution has apparently not removed the restitution order from his file. It appears that the problem lies with the Department of Corrections, not the court or district attorney. In any event, there is no order of restitution in Lindell's case and the issue cannot be considered, and any error corrected, in this § 974.06 action.

The quoted brief is dated September 4, 2002, and Lindell submitted a copy of it to the Dane County circuit court on December 9, 2002, in order to establish that the La Crosse County circuit court had corrected the erroneous restitution order and that the State had essentially directed him to seek relief from the DOC.

¶ 25. On the basis of Lindell's submissions, the circuit court concluded that Lindell had stated a prima facie claim for mandamus relief. The court directed the respondents to inform the court why it should not grant Lindell his requested relief. In response to the court's order, the respondents submitted several affidavits with attached copies of various documents. These submissions show that the business office at the prison where Lindell was housed did not receive a copy of the revised restitution order entered in La Crosse County, or any other form of verification that the original restitution order had been rescinded or modified, until Lindell contacted the business office in late March of 2003 and provided a copy of this court's decision in State v. Nathaniel A. Lindell, No. 02-1158-CR, unpublished slip op. (Wis. App. Mar. 13, 2003). We noted in that decision that the original restitution order "had been entered in error, but had already been voided. Therefore, it was not necessary for the [La Crosse County] trial court to take any further action to remedy the situation; it remained only for the DOC to update its files." Id., ¶ 4. Upon receiving a copy of our opinion from Lindell, business office personnel "inactivated" Lindell's restitution obligation on April 4, 2003, and subsequently refunded $12.26 to his account.

¶ 26. Thus, although Lindell's mandamus action became moot within days of its filing, his allegation that prison officials had a plain legal duty to cease withholding restitution payments from his prison account and to refund the amount previously deducted was arguably meritorious at the time his petition was accepted for filing on March 28, 2003. One could well argue that, instead of resorting to a mandamus action to compel DOC officials to act, Lindell could have and should have, months earlier, directed his efforts toward obtaining and submitting to the prison business office a copy of the revised restitution order from La Crosse County. That arguably more reasonable alternative, however, does not, in our view, deprive his initial mandamus petition of arguable merit.

¶ 27. In sum, when the Dane County circuit court ordered a response to Lindell's petition, it had concluded that Lindell's petition stated a claim and possessed arguable merit. Our review persuades us of the same thing. The facts that (1) the petition very quickly became moot, and (2) Lindell thereafter unsuccessfully attempted to amend his initial pleading to include a number of spurious and unsupportable claims, do not alter the fact that Lindell's original mandamus petition was not "dismissed by a state or federal court for any of the reasons listed in s. 802.05(3)(b)1. to 4." Wis. Stat. § 801.02(7)(d). Accordingly, the dismissal of this action does not qualify as a "strike" under § 801.02(7)(d), and the circuit court erred in so declaring.

Request for Sanctions Against Respondents' Counsel

¶ 28. Finally, Lindell asserts that the circuit court erred in not sanctioning the respondents' counsel under Wis. Stat. §§ 802.05(1)(a) and 814.025 for misrepresenting the law in objecting to his proposed amended complaint. He asks us to conclude that sanctions are called for and to direct the circuit court on remand to impose them. We reject Lindell's claim. Although we have not embraced all of the arguments counsel for the respondents advanced, both here and in the circuit court, in opposition to Lindell's attempt to amend his complaint, we have adopted the respondents' position that, in actions commenced by prisoners, Wis. Stat. § 802.09(1) must give way to § 802.05(3). Accordingly, the respondents' objection to Lindell's proposed amendment was well founded and there is no basis for sanctions to be imposed against them or their counsel under either §§ 802.05(l)(a) or 814.025.

CONCLUSION

¶ 29. For the reasons discussed above, we direct that the appealed order (filed August 4, 2003) be modified to delete the sentence reading, "It will count as a strike on petitioner's litigation record." We affirm the order as so modified.

By the Court. — Order modified and, as modified, affirmed.

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       Lindell's petition is captioned "Petition for Mandamus /Prohibition, Replevin, with Pendant Claims under 42 U.S.C. § 1983." The petition, however, does not plead a claim under § 1983. The only relief specifically sought in the body of the petition is the issuance of an "Injunction/Writ of Prohibition" and the reimbursement of "all monies lost based on the above-noted restitution order," plus the costs of bringing the action. There are also references early in the record to a request by Lindell for a John Doe proceeding, which request the court denied at the time it ordered a response to the petition. Lindell does not challenge that denial in this appeal.

       "Prisoner" is defined, for purposes of the WPLRA, as "any person who is incarcerated, imprisoned or otherwise detained in a correctional institution or who is arrested or otherwise detained by a law enforcement officer." Wis. Stat. § 801.02(7)(a)2. Lindell does not dispute that he is a "prisoner."

       For example, Lindell alleges that respondent Voigt, a DOC probation and parole agent, not only lacked legal authority to forward the La Crosse County circuit court's initial (erroneous) restitution order to the prison business office, but that she did so "with malice" because, in concert with the La Crosse County District Attorney, her action was intended to discourage Lindell from appealing his conviction or to retaliate against him for doing so. As to respondents Litscher, then secretary of the DOC, and Berge, a prison warden, Lindell alleges they had a duty to prevent his rights from being violated, were ultimately responsible for the actions of DOC employees they supervised, and directly denied him due process by not granting him redress on his inmate complaints regarding the restitution deductions.

       On January 23, 2003, the La Crosse County District Attorney faxed a letter to the Dane County circuit court confirming the entry of an amended restitution order on January 29, 2002, that had "set[] restitution at zero." The district attorney also indicated that "the Court records since January 29, 2002, should reflect that Mr. Lindell does not owe restitution." He further noted that the criminal case record was in this court pursuant to Lindell's criminal appeal and that the original of the revised restitution order could be located there.

       The record also contains a form "Dismissal Order (Prisoner Litigation) Under 801.02(7)(d)" that the circuit court signed on August 7, 2003. This document does not appear to have been "filed" by the clerk of circuit court, and it is not cited in Lindell's Notice of Appeal as the order being appealed. The form order has boxes checked indicating that the "matter fails to state a claim upon which relief may be granted" on the basis of "see decision," and states that "[t]his dismissal constitutes a single dismissal within the meaning of § 801.02(7)(d), Wisconsin Statutes." A copy of the court's Decision and Order, filed August 4, 2003, which is the subject of this appeal, is attached to the form. The form also indicates that a copy of it was to be sent to the Department of Justice Civil Litigation Unit. We direct that, on remand, this form order be vacated and that counsel for respondents shall take the necessary steps to correct the Department of Justice prisoner litigation records to reflect that the instant dismissal is not to be counted as a strike under § 801.02(7)(d).


source: Caselaw Access Project

author: DYKMAN, J.

license: Public Domain

text:
    State of Wisconsin, Plaintiff-Appellant, v. Ryan E. Baker, Defendant-Respondent.

    Court of Appeals

      Nos. 04-0590-CR, 04-0591-CR.

      Submitted on briefs September 7, 2004.

    Decided February 17, 2005.

    2005 WI App 45
    (Also reported in 694 N.W.2d 415.)

      On behalf of the plaintiff-appellant, the cause was submitted on the briefs of Jason J. Hanson, assistant district attorney, Madison.
    On behalf of the defendant-respondent, the cause was submitted on the brief of William E. Schmaal, assistant state public defender.
    Before Deininger, PJ., Dykman and Lundsten, JJ.

       Petition to review denied 5-11-2005.

   DYKMAN, J.

¶ 1. The State appeals from the circuit court's order returning a bond deposit to the person who posted it and applying five days of pre-sentence jail incarceration to satisfy court costs upon a judgment of conviction against Ryan E. Baker. The State contends that the circuit court erred because Wis. Stat. § 969.02(6) (2003-04) does not permit the application of incarceration time for this purpose and instead requires the payment of court costs from a defendant's bond deposit. Baker asserts that § 969.02(6) makes no such requirement of judges and instead is directed at clerks. Alternatively, he argues that his indigency provided an adequate basis under Wis. Stat. § 814.29(1) for the court's action. Because we interpret § 969.02(6) to require a circuit court to order that any remainder of a defendant's bond deposit be applied toward the payment of court costs, we reverse the circuit court's order and remand for further proceedings consistent with this opinion.

BACKGROUND

¶ 2. Ryan E. Baker pleaded no contest to one misdemeanor count of violating a domestic abuse injunction, contrary to Wis. Stat. § 813.12(8)(a), and one count of misdemeanor bail jumping, contrary to Wis. Stat. § 946.49(l)(a). In a separate case, he also pleaded no contest to one count of misdemeanor violation of a domestic abuse injunction. The bail-jumping charges stemmed from committing a new crime while on bond for five counts of selling fake identification cards. The court found Baker guilty on these five counts as a result of the bail violation. Baker's court costs and fees from these proceedings included: $375 in filing fees for five counts of selling fake identification cards pursuant to Wis. Stat. § 814.61(l)(a); $60 in filing fees for three criminal charges pursuant to Wis. Stat. § 814.60(1); $150 for crime victim and witness assistance surcharges for three criminal charges pursuant to Wis. Stat. § 973.045.

¶ 2a. Baker's father had posted a $500 bond at an earlier date. The bond was in effect at the time of Baker's plea and sentencing hearing. At that proceeding, the State asked the court to order that the bond be applied to Baker's court costs, arguing that Wis. Stat. § 969.02(6) mandated this result. The court declined to apply the bond to the court costs, thereby permitting the return of the bond to Baker's father. The court instead ordered that court costs be satisfied by pre-sentence jail incarceration, applying six days of incarceration at a rate of $100 per day to satisfy the costs. The court explained:

Well, I understand the argument that [use of jail credit to pay court costs] is not, that it is not authorized by statute. I haven't really chased it down vigorously. I do know that it has been accepted typically in Dane County. So I think on the basis of giving the equivalent treatment to people that come before the Court and not singling out any particular defendant for treatment of the statutory costs, while I certainly see a basis for trying to get this defendant's attention more effectively than has been done yet, in his own best interest I don't think I should depart from the practice that has been in place.

The State appeals. The Chief Judge granted the State's motion that this case be heard by a three-judge panel. See § 752.31(3).

DISCUSSION

Use of Bond

¶ 3. The parties dispute whether Wis. Stat. § 969.02(6) requires that remaining bond money be used to satisfy court costs, and whether this section gives a circuit court discretion to order payment of court costs through application of credit for jail incarceration time. These are questions of statutory interpretation that we review de novo. In re Commitment of Burris, 2004 WI 91, ¶ 31, 273 Wis. 2d 294, 682 N.W.2d 812.

¶ 4. We consider the bond money question first. Under Wis. Stat. § 969.02(2), a circuit court may require a defendant charged with a misdemeanor to "execut[e] ... an appearance bond with sufficient solvent sureties, or the deposit of cash in lieu thereof." Section 969.02(6) provides that "[w]hen a judgment for a fine or costs or both is entered in a prosecution in which a deposit had been made in accordance with sub. (2), the balance of such deposit, after deduction of the bond costs, shall be applied to the payment of the judgment."

¶ 5. We review a statute to ascertain its meaning, so that the statute may be given its full, proper and intended effect. State ex rel. Kalal v. Circuit Court, 2004 WI 58, ¶ 44, 271 Wis. 2d 633, 681 N.W.2d 110. "Judicial deference to the policy choices enacted into law by the legislature requires that statutory interpretation focus primarily on the language of the statute." Id. When interpreting a statute, we "begin[] with the language of the statute. If the meaning of the statute is plain, we ordinarily stop the inquiry." Seider v. O'Connell, 2000 WI 76, ¶ 43, 236 Wis. 2d 211, 612 N.W.2d 659. If the statutory intent is set forth clearly and unambiguously in the statutory language, we apply that intent to the case at hand and do not search for meaning outside the text of the statute. State v. Setagord, 211 Wis. 2d 397, 406, 565 N.W.2d 506 (1997). We may resort to extra-textual sources only when the statutory language is ambiguous, i.e., it "reasonably gives rise to different meanings." Bruno v. Milwaukee County, 2003 WI 28, ¶ 21, 260 Wis. 2d 633, 660 N.W.2d 656.

¶ 6. Baker contends that Wis. Stat. § 969.02(6) "does not restrict the circuit court's discretionary powers in the pronouncement of judgment... it only proscribes a ministerial duty that the clerk 'shall' perform ...." But Baker cites no authority to support this contention, and we know of none.

¶ 7. We conclude that the plain language of Wis. Stat. § 969.02(6) requires the circuit court to order the application of the balance of any bond deposit toward the satisfaction of court costs. The subsection provides that "[a] deposit. . . shall be applied to the payment of the judgment." Section 969.02(6). "[T]he word 'shall is presumed mandatory when it appears in a statute." In re Commitment of Elizabeth M.P., 2003 WI App 232, ¶ 21, 267 Wis. 2d 739, 672 N.W.2d 88 (citations omitted). Additionally, the words "may" and "shall" are both used in various subsections of § 969.02, "indicating the legislature was aware of the distinct meanings of the [two] words," and thus lending" [further support... to a mandatory interpretation of 'shall.'" In re Commitment of Sprosty, 227 Wis. 2d 316, 324, 595 N.W.2d 692 (1999).

¶ 8. The statutory text contains no suggestion that this duty rests with the clerk and not the circuit court judge. Under Baker's view of Wis. Stat. § 969.02(6), a judge's order could countermand the statute's edict that the "balance of [a bond] deposit... shall be applied to the payment of [a] judgment" by refunding the existing bond money. The clerk would then be unable to follow the statute's requirement. Baker's proposed interpretation is thus inapposite to the explicit purpose of § 969.02(6). Klein v. Board of Regents, 2003 WI App 118, ¶ 13, 265 Wis. 2d 543, 666 N.W.2d 67 ("Statutory interpretation that contravenes a purpose of the statute is not favored.").

¶ 9. Baker also contends that because judges may order the return of a defendant's bail money to a depositor before sentencing, it must be that judges have discretion to return bail money at sentencing as well. We again disagree. It does not follow that because a circuit court has discretion to return bail money before sentencing under Wis. Stat. § 969.01(4), such discretion must also exist at sentencing. "If the authority to fashion a particular criminal disposition exists, it must derive from the statutes." Grobarchik v. State, 102 Wis. 2d 461, 467, 307 N.W.2d 170 (1981) (citations omitted).

¶ 10. Baker also contends that "implicit findings" of indigency justify the waiver of his court costs, and that we should therefore uphold the circuit court's ruling on indigency grounds under Wis. Stat. § 814.29(1). Section 814.29(1) guarantees access to the courts for the indigent in civil proceedings, and may or may not apply to at least some costs in criminal proceedings through Wis. Stat. § 972.11(1). Baker cites State ex rel. Girouard v. Circuit Court, 155 Wis. 2d 148, 454 N.W.2d 792 (1990), to support waiver of costs in the present context, but Girouard concerned waiver of transcription fees in a civil appeal, not court costs assessed in a criminal case. Girouard, 155 Wis. 2d at 150. In general, § 814.29(1) protects the constitutional right of access to the courts for all. Whether § 814.29(1) provides a basis to waive court costs ordered at judgment in a criminal proceeding is not an issue that is properly before us today. The circuit court did not waive Baker's costs — it ordered them satisfied through credit for jail incarceration time.

Credit for Pre-Sentence Incarceration

¶ 11. We turn now to whether credit for pre-sentence incarceration time may be applied to satisfy court costs. The circuit court invoked Wis. Stat. § 973.155 when applying Baker's incarceration time toward satisfaction of court costs. We conclude that this section does not provide a basis for the circuit court's action. Section 973.155(1) states that "a convicted offender shall be given credit toward the service of his or her sentence for all days spent in custody in connection with the course of conduct for which sentence was imposed." Section 973.155 does not address court costs. Rather, its purpose is to ensure that individuals without the means to post hail are not incarcerated longer than those who can afford bail. "[C]onfinement credit is designed to afford fairness — that a person not serve more time than that for which he is sentenced." State v. Beets, 124 Wis. 2d 372, 379, 369 N.W.2d 382 (1985).

¶ 12. Some statutes imposing certain court costs provide that a court may waive these costs. Examples include: Wis. Stat. § 973.055(4), which permits a court to waive a $50 domestic abuse assessment if the court determines that imposition of the assessment would have a negative impact on the family; Wis. Stat. § 973.06(2), which allows a court to remit all or part of the taxable costs set forth in that statutory section; and Wis. Stat. § 973.046(lg), which leaves it to the discretion of the court whether to assess the defendant the costs of DNA testing.

¶ 13. None of the statutes under which Baker was assessed costs — Wis. Stat. §§ 814.61(l)(a), 814.60(1), or 973.045 — include mechanisms by which a court could waive these costs or satisfy them by any other means. Each of these statutes contains mandatory language regarding the payment of the particular costs imposed. Section 814.61(l)(a) provides that "[i]n a civil action, a clerk of court shall collect the fees provided in this section...." Section 814.60(1) mandates that "[i]n a criminal action, the clerk of court shall collect a fee of $20 ...." Likewise, § 973.045 directs that "the court shall impose a crime victim and witness assistance surcharge ... [and] the clerk of court shall collect and transmit the amount to the county treasurer.... " Because none of the statutes under which costs were assessed here provide authority to waive the costs or to satisfy them by other means, we conclude that the circuit court erred when it applied pre-sentence incarceration time toward satisfaction of Baker's court costs.

By the Court. — Judgment and order reversed and cause remanded with directions.

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       "A judge may release a defendant charged with a misdemeanor without bail or may permit the defendant to execute an unsecured appearance bond ...." Wis. Stat. § 969.02(1). "[T]he judge may require the execution of an appearance bond ... or the deposit of cash in lieu thereof." Section 969.02(2). "[T]he judge may [impose various conditions upon the defendant listed in paragraphs (a)-(d)]." Section 969.02(3). "As a condition of release in all cases, a person released under this section shall not commit any crime." Section 969.02(4). "Any person charged with a misdemeanor and released under this section shall comply with s. 940.49. The person shall be given written notice of this requirement." Section 969.02(4m). "Once bail has been given and a charge is pending or is thereafter filed or transferred to another court, the latter court shall continue the original bail in that court subject to s. 969.08." Section 969.02(5). "If the complaint against the defendant has been dismissed or if the defendant has been acquitted, the entire sum deposited shall be returned. A deposit under sub. (2) shall be returned to the person who made the deposit, his or her heirs or assigns, subject to sub. (6)." Section 969.02(7). "In all misdemeanors, bail shall not exceed the maximum fine provided for the offense." Section 969.02(8) (all emphases added).

       Wisconsin Stat. § 814.29(1) provides in pertinent part:
      (a).. . any person may commence, prosecute or defend any action or special proceeding in any court, or any writ of error or appeal therein, without being required to give security for costs or to pay any service or fee, upon order of the court based on a finding that because of poverty the person is unable to pay the costs of the action or special proceeding....

        (b) A person seeking an order under par. (a) shall file in the court an affidavit in the form prescribed by the judicial conference, setting forth . . . facts demonstrating his or her poverty.
      (c) The finding and order of the court under par. (a) shall be in the form prescribed by the judicial conference. The court may deny the request for an order if the court finds that the affidavit states no claim, defense or appeal upon which the court may grant relief.
      (d) The court shall make a finding of poverty and issue an order under par. (a) if the affidavit demonstrates any of the following:
      2. That the person is represented by an attorney through a legal services program for indigent persons, including. . . those funded by ... the state public defender ....

       WISCONSIN Stat. §972.11(1) provides in pertinent part that "the rules of evidence and practice in civil actions shall be applicable in all criminal proceedings unless the context of a section or rule manifestly requires a different construction."


author: SNYDER, J.

text:
    Jeffrey Schwigel and Classic Tool & Machine Company, Plaintiffs-Respondents, v. David J. Kohlmann, Jane Kohlmann, and Kohlmann Tool & Design, Inc., Defendants-Appellants, Port Washington State Bank and Middle West Manufacturing, Inc., Intervenors.
    Court of Appeals

      No. 04-0588.

      Submitted on briefs January 7, 2005.

    Decided February 23, 2005.

    2005 WI App 44
    (Also reported in 694 N.W.2d 467.)

      On behalf of the defendants-appellants, the cause was submitted on the briefs of Benjamin J. Harris of Harris & Associates, S.C., Milwaukee and Paul Piasko-ski, of counsel, of Paul Piaskoski, LLC, Milwaukee.

      On behalf of the plaintiffs-respondents, the cause was submitted on the brief of Daniel W. Stevens and Nicholas Zales of Stevens & Kroening, LLC, Brookfield.
    Before Brown, Nettesheim and Snyder, JJ.

       Petition to review denied 7-28-2005.

   SNYDER, J.

¶ 1. David and Jane Kohlmann and Kohlmann Tool & Design, Inc. (Kohlmann) appeal from a judgment on a jury verdict awarding a total of $412,000 in compensatory and punitive damages to Jeffrey Schwigel and Classic Tool & Machine Company (Schwigel). Kohlmann contends that the trial court erred when it failed to differentiate between Schwigel's contract claim and his conversion claim when instructing the jury on punitive damages. Kohlmann further contends that the jury's punitive damages award was grossly excessive and a violation of due process principles. Finally, Kohlmann argues that there was no credible evidence to support the jury's compensatory damages award. We agree that the trial court erred when it failed to provide a jury instruction on the difference between the contract claim and the conversion claim when awarding punitive damages; nonetheless, we conclude that the error was harmless. We disagree with Kohlmann’s remaining contentions and affirm the judgment of the trial court.

BACKGROUND

¶ 2. This appeal arises from a retrial pursuant to our remand order in Schwigel v. Kohlmann, 2002 WI App 121, 254 Wis. 2d 830, 647 N.W.2d 362. There, Schwigel brought five claims against Kohlmann: breach of contract, negligent misrepresentation, unjust enrichment, promissory estoppel, and conversion of equipment. Id., ¶ 8. The jury awarded Schwigel compensatory damages of $250,000 on the contract, misrepresentation and unjust enrichment claims, $12,000 on the conversion claim, and $300,000 in punitive damages. Id., ¶ 9. The historical facts of the current appeal were set forth in our previous opinion, and we provide an abbreviated rendition here for context.

¶ 3. In 1998, Kohlmann was operating his tool and die business out of a shop he owned in Cedarburg, Wisconsin. After Kohlmann and Schwigel became acquainted, Kohlmann asked Schwigel to move his toolmaking business to Kohlmann's shop. Schwigel declined. During October 1999, Kohlmann told Schwigel that he had located a prospective and lucrative motor shaft production job. Since Schwigel had the expertise and machinery to handle the job, Kohlmann again asked Schwigel to relocate to his shop and to take over the prospective job.

¶ 4. The talks eventually produced a verbal agreement whereby Schwigel would share space in Kohlmann's shop at the cost of $700 per month. The motor shaft production job was a substantial factor in Schwigel's decision to relocate. Schwigel moved into Kohlmann's shop on or about November 3, 1999. Because of limited space, Schwigel stored some of his equipment in another building owned by Jack Dunfee, a business associate of Kohlmann. Dunfee did not charge Kohlmann for storing Schwigel's equipment, and Kohlmann had the only key to the storage area.

¶ 5. On November 19,1999, Kohlmann received a purchase order from the manufacturer for the immediate production of the shafts. After receiving the purchase order, Schwigel and Kohlmann went to Illinois to look into purchasing a machine to mass produce the shaft job. On December 2, 1999, Schwigel received approval from his bank to purchase the mass-production machine. However, two days later, Kohl-mann told Schwigel that he was going to buy the machine for himself in order to produce the shafts and keep the job for himself.

¶ 6. Thereafter, the relationship between Schwi-gel and Kohlmann deteriorated, and on December 28, 1999, Kohlmann told Schwigel to leave. Without notice to Schwigel, Kohlmann changed the locks on the shop, prohibiting Schwigel from gaining access to his equipment and performing work for his customers. After numerous attempts to get access to the shop, Schwigel contacted the Cedarburg police to help him get his equipment back. On January 18 and 19,2000, the police supervised as Schwigel moved his equipment out of Kohlmann's shop. At that time, Schwigel also asked to remove his other equipment that had been stored in the building owned by Dunfee. Neither Dunfee nor Kohl-mann would allow Schwigel access to the storage building, and the police told Schwigel that if he attempted to access the building he would be charged with trespassing.

¶ 7. By July 2000, Schwigel had lost all of his customers and he was out of business. Four months later, in November 2000, Schwigel received a phone call from Dunfee who told him to come and get his equipment from the storage building. When Schwigel went to remove his equipment from the storage building, he found that certain items were missing.

¶ 8. On appeal, we affirmed Kohlmann's liability on the breach of contract, negligent misrepresentation, and unjust enrichment claims, but reversed the compensatory and punitive damages awards. Id., ¶ 2. We remanded the matter for a new trial on compensatory damages associated with the three claims and on the issue of punitive damages. Id., ¶ 26. Subsequently, Schwigel chose to pursue damages for breach of contract and punitive damages. Following retrial, the jury awarded Schwigel $37,000 in compensatory damages for the breach of contract and $375,000 in punitive damages. The trial court upheld the verdict and entered judgment accordingly. Kohlmann appeals.

DISCUSSION

Jury Instructions

¶ 9. Kohlmann first contends that the trial court erred when it failed to instruct the jury that punitive damages cannot be awarded on the breach of contract claim. A trial court has broad discretion in deciding whether to give a particular jury instruction, and the court must exercise its discretion to "fully and fairly inform the jury of the rules of law applicable to the case and to assist the jury in making a reasonable analysis of the evidence." State v. Coleman, 206 Wis. 2d 199, 212, 556 N.W.2d 701 (1996) (citation omitted). However, we will independently review whether a jury instruction is appropriate under the specific facts of a given case. State v. Groth, 2002 WI App 299, ¶ 8, 258 Wis. 2d 889, 655 N.W.2d 163, review denied, 2003 WI 32, 260 Wis. 2d 752, 661 N.W.2d 100 (No. 01-3000-CR).

¶ 10. The scope of the new trial below was limited to damages. The special verdict contained eighteen questions, sixteen of which were answered by the trial court. The jury was required to make two findings: (1) what sum of money would compensate Schwigel for the breach of contract, and (2) what sum of money should he awarded as punitive damages. In Wisconsin, punitive damages are not available as a remedy for breach of contract. Autumn Grove Joint Venture v. Rachlin, 138 Wis. 2d 273, 279, 405 N.W.2d 759 (Ct. App. 1987). Neither the jury instructions nor the verdict form itself advised the jury that punitive damages are not to be awarded for the breach of contract and must be determined based only upon Kohlmann's conduct in relation to the conversion claim. By such omission, the trial court failed to fully and fairly inform the jury of the rules of law applicable to the case.

¶ 11. Although the trial court did err in its failure to fully instruct the jury, we conclude that the error was harmless. The standard for harmless error is the same for civil and criminal cases. Town of Geneva v. Tills, 129 Wis. 2d 167, 184-85, 384 N.W.2d 701 (1986). The test is whether there is a reasonable possibility that the error contributed to the outcome of the action or proceeding at issue. State v. Dyess, 124 Wis. 2d 525, 543, 370 N.W.2d 222 (1985). A reasonable possibility of a different outcome is a possibility sufficient to "undermine confidence in the outcome." Id. at 545.

¶ 12. Schwigel argues that the conduct relating to the breach of contract provided the historical context for the conversion claim and the punitive damages. The trial court shared this view, stating that "all matters of fact relevant to consideration of all aspects of damages are clearly relevant to the jury's consideration of punitive damages" and therefore the jurors are "entitled to listen to [the negligent misrepresentation and conversion findings to] determine what they feel would be an appropriate punitive damage award if they find that the conduct on the part of the defendants was outrageous." We agree that the jury heard and considered the same evidence of outrageous conduct that would have been presented had the breach of contract compensation issue been severed and tried independently.

¶ 13. In our remand directive to the trial court, we stated that "[s]ince the purpose of punitive damages is to punish, see Wis JI — Civil 1707, it follows that the jury determining punitive damages must be apprised of the offending conduct." Schwigel, 254 Wis. 2d 830, ¶ 20. We did not direct that Kohlmann's outrageous conduct be presented to the jury in a contextual vacuum. The facts of this case demonstrate that the promised contract, which is the subject of the claim for breach, set in motion a series of events that led to Kohlmann's conversion of Schwigel's equipment.

¶ 14. After considering postverdict motions, the trial court observed that "even if the only premise upon which the jury could return [a] punitive damage award in this case was the conversion damages," Kohlmann's malicious conduct "insulted" the jury and as a result the jury felt that its punitive damages award was necessary to deter Kohlmann from engaging in such conduct in the future. The trial court was convinced that Kohlmann's conduct relating to the conversion claim was sufficiently outrageous to support the jury's punitive damages award.

¶ 15. Our review of the record confirms the trial court's determination. Kohlmann changed the locks on the building and prevented Schwigel from accessing his machinery and customer blueprints. Kohlmann later attempted to charge Schwigel for the cost of changing the locks. Schwigel finally gained access to the building and found that Kohlmann had thrown his inspection equipment in a pile on the floor. When Schwigel returned with his family to remove his equipment from Kohlmann's building, Kohlmann was abusive, threatening, and throwing things. Kohlmann called the Schwi-gels "city trash" and made inflammatory statements about Schwigel's mother-in-law.

¶ 16. Schwigel subsequently tried to recover his equipment from Dunfee's storage facility, but Kohl-mann held the only key. Schwigel wrote to Kohlmann, requesting access to the stored equipment. Eventually, eleven months later, Dunfee called Schwigel and told him to pick up his equipment or it would be scrapped. When Dunfee opened the door to the storage facility, Schwigel saw that his lathe, lathe accessories, and tooling cabinets were gone. Later, Kohlmann taunted Schwigel about the missing equipment. Schwigel stated that the truth would eventually come out, hut Kohl-mann responded, "[TJhey'll find you with your head caved in long before that."

¶ 17. Although Kohlmann correctly argues that an additional jury instruction should have been given, our confidence in the verdict is not undermined. There is no reasonable possibility of a different outcome and therefore the error was harmless. See Dyess, 124 Wis. 2d at 545.

Excessiveness of Punitive Damages

¶ 18. Kohlmann next argues that the $375,000 punitive damages award is grossly excessive and violates due process. The award of punitive damages in a particular case is within the discretion of the jury. Trinity Evangelical Lutheran Church and School-Freistadt v. Tower Ins. Co., 2003 WI 46, ¶ 46, 261 Wis. 2d 333, 661 N.W.2d 789, cert. denied, 540 U.S. 1074 (2003). When reviewing a circuit court's determination of the constitutionality of a punitive damages award, however, we employ a de novo standard of review. Id., ¶¶ 47-48.

¶ 19. "[TJhe purpose of punitive damages is to punish the wrongdoer, and to deter the wrongdoer and others from similar conduct...." Id., ¶ 50 (citation omitted). To determine whether a punitive damages award is excessive, we consider the following: the grievousness of the acts, the degree of malicious intent, the relationship between the punitive damages and the compensatory damages, the potential damage that might have been caused by the acts, the ratio of the award to civil or criminal penalties that could be imposed for comparable misconduct, and the wealth of the wrongdoer. Id., ¶ 53.

¶ 20. Kohlmann concedes that he acted with malice in converting Schwigel's property, but argues that this is insufficient to support the jury's punitive damages award. Specifically, Kohlmann contends that Schwigel suffered no physical harm, his health and safety were not compromised, he was not financially vulnerable, and there was only one incident of conversion; therefore, the jury's award is excessive. See State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 418-19 (2003) (explaining the factors used to analyze the degree of reprehensibility of a defendant's conduct). We reject Kohlmann's assessment. Some wrongs are more "blameworthy" and here Kohlmann's intentional conversion of the property "reveals an indifference and a reckless disregard for the law, and for the rights of others." See Jacque v. Steenberg Homes, Inc., 209 Wis. 2d 605, 628, 563 N.W.2d 154 (1997). Moreover, the evidence in this case abundantly supports the first jury's determination that Kohlmann acted maliciously or in intentional disregard of Schwigel's rights. See Schwigel, 254 Wis. 2d 830, ¶ 20. The amount of punitive damages awarded by the second jury reflects the reprehensible nature of Kohlmann's conduct.

¶ 21. Kohlmann further argues that although no set ratio between punitive and compensatory damages exists, a ratio of more than four to one may not pass constitutional muster under the due process protections of the Fourteenth Amendment. Here, the ratio between the $375,000 punitive damages award and $12,000 compensation for conversion is just over thirty to one. Nonetheless, courts have expressly rejected the use of a fixed multiplier to calculate punitive damages. See, e.g., Jacque, 209 Wis. 2d at 629; BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 582 (1996). A ratio, therefore, is but one factor in assessing the reasonableness of the award. Jacque, 209 Wis. 2d at 629.

¶ 22. The United States Supreme Court has observed that larger punitive damages awards may be constitutional where "a particularly egregious act has resulted in only a small amount of economic damages." BMW, 517 U.S. at 582. In the context presented here, Kohlmann's profoundly egregious conduct was disproportionate to the relatively small amount of economic loss incurred by Schwigel. Accordingly, a comparison of the punitive damages award to the compensatory damages award does not defeat the jury's verdict.

¶ 23. Kohlmann also argues that there must be some relationship between the punitive damages and the penalty that would have been available in a comparable criminal charge. See Trinity, 261 Wis. 2d 333, ¶ 66. Here, the comparable criminal charge is found in Wis. Stat. § 943.20(3)(c) (2003-04), which states that misappropriation of property valued at more than $10,000 is a Class G felony: Wisconsin Stat. § 939.50(3)(g) imposes a fine of up to $25,000 for a Class G felony. Because punitive damages are assessed for punishment, it is relevant to consider the criminal fines associated with similar conduct. See Jacque, 209 Wis. 2d at 630.

¶ 24. Like our supreme court in Jacque, we conclude that the conduct exhibited here "could scarcely have been contemplated by the legislature when it enacted [these] statute [s] ...." Id. The misappropriation statute provides a penalty for anyone who "[intentionally takes and carries away, uses ... or retains possession of movable property of another" without consent. Wis. Stat. § 943.20(l)(a). In contrast, Kohl-mann became verbally abusive toward Schwigel and his family, threw objects, mistreated Schwigel's property, delayed several months before allowing access to a portion of the property, and threatened that Schwigel would have his "head caved in." We see no reason why the legislatively imposed $25,000 fine for misappropriation would deter such outrageous conduct by Kohlmann in the future. Consequently, the punitive damages award need not mirror the comparable criminal penalty in this case.

Credible Evidence Supporting Compensatory Damages

¶ 25. Kohlmann finally contends that the jury's award of $37,000 in compensatory damages for breach of contract has no credible support in the record. Our review of a jury's verdict is narrow, and we will sustain it if there is any credible evidence to support it. Betterman v. Fleming Cos., 2004 WI App 44, ¶ 15, 271 Wis. 2d 193, 677 N.W.2d 673. It is the jury's role, not ours, to balance the credibility of witnesses and weigh the evidence. Id. Our standard of review here is even more stringent because the trial court approved the verdict by denying Kohlmann's postverdict motions. See id., ¶ 16. We afford special deference to a jury's verdict where the trial court has approved the jury's findings. Id. Accordingly, we will not overturn the jury's verdict unless there has been "such a complete failure of proof that the verdict must be based on speculation." Id. (citation omitted).

¶ 26. Our review of the record reveals that documentary evidence on the issue of damages was presented to the jury by both parties. Kohlmann contends that credible evidence exists to support "[a]t best. . . $7,500 to $8,900 in compensatory damages naturally flowing from Kohlmann's breach of contract." This represents the moving expenses incurred by Schwigel when he acted upon the agreement to lease industrial space from Kohlmann.

¶ 27. At trial, Schwigel argued that his personal net worth declined by approximately $387,000 due to Kohlmann. He further argued that he lost income of $50,000 per year for two years, bringing his compensatory claim to about $487,000 plus all reasonable expenses resulting from the breach. According to Schwi-gel, he had $37,000 "cash in the bank" one month before he met Kohlmann. Schwigel presented financial statements, purchase orders, equipment lists, and other documentation to support his demand for damages.

¶ 28. We observe that Kohlmann successfully challenged some of Schwigel's calculations. Nonetheless, on appeal it is our responsibility to search the record for evidence to support the jury's verdict, not for evidence to support a verdict that the jury could have reached but did not. Morden v. Continental AG, 2000 WI 51, ¶ 39, 235 Wis. 2d 325, 611 N.W.2d 659. If the evidence gives rise to more than one reasonable determination, as it does here, we must accept the inference reached by the jury. See id.

CONCLUSION

¶ 29. We conclude that the trial court erred when it did not instruct the jury that punitive damages may not be awarded on a breach of contract claim. We hold, however, that under the circumstances of this case the error was harmless because it does not undermine our confidence in the jury's verdict. We further conclude that the amount of punitive damages is not grossly excessive and comports with the due process requirements of the Fourteenth Amendment. Finally, we conclude that sufficient credible evidence exists to support the jury's compensatory damages award for breach of contract.

By the Court. — Judgment affirmed.

       The jury found in favor of Schwigel on all claims except promissory estoppel. Schwigel v. Kohlmann, 2002 WI App 121, ¶ 9, 254 Wis. 2d 830, 647 N.W.2d 362.

       Kohlmann did not challenge that portion of the judgment associated with the conversion claim. Schwigel, 254 Wis. 2d 830, ¶ 1.

       Schwigel explains that he elected to limit the issues on remand because of a concern about "raising new appellate issues regarding the differing measure of damages" on the breach of contract, negligent misrepresentation, and unjust enrichment claims.

       The special verdict included sixteen questions that were answered by the trial court on the basis of the original jury verdict and our remand directive in Schwigel.

       Prior to the retrial, Kohlmann moved to sever the punitive damages claim from the compensatory damages claim. The trial court denied that motion. Kohlmann does not contest the court's ruling on appeal.

       The Wisconsin test for excessive punitive damages is nearly identical to that used by the United States Supreme Court, which requires a reviewing court to consider: (1) the degree of reprehensibility of the defendant's conduct, (2) the disparity between the punitive damages award and the actual or potential harm suffered by the plaintiff, and (3) the difference between the punitive damages award and the criminal penalties authorized or imposed in comparable cases. See State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 418-19 (2003).

       All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       For example, Schwigel originally testified that his moving expenses were approximately $20,000; however, on cross-examination he conceded that he incurred moving expenses of only $8,900.


author: BROWN, J.

text:
    James Helnore and Constance Helnore, Plaintiffs-Appellants, v. Department of Natural Resources, State of Wisconsin, Defendant-Respondent, Joanne Kline and Cherie Weiloch, Defendants.
    Court of Appeals

      No. 04-0602.

      Oral argument January 27, 2005.

    Decided February 23, 2005.

    2005 WI App 46
    (Also reported in 694 N.W.2d 730.)

      On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of Donald J. Mum, Michelle E. Martin and Peter W. McCombs of Mum & Martin, S.C., of Waukesha. There was oral argument by Donald J. Mum.

    On behalf of the defendant-respondent, the cause was submitted on the brief of Peggy A. Lautenschlager, attorney general, and Joanne E Kloppenburg, assistant attorney general. There was oral argument by Joanne F. Kloppenburg.

    Before Brown, Nettesheim and Snyder, JJ.
   BROWN, J.

¶ 1. James and Constance Helnore own two lots that have been designated as wetlands. They previously built a house on one lot and now want to build a house on the other. Because they have been informed by the Wisconsin Department of Natural Resources that a water quality certificate is unlikely to be granted — a condition precedent to a permit to build —they have instituted this action, claiming that the designation of their property as wetlands constituted a taking. We hold that they first have to pursue administrative remedies, beginning with an application for a WQC. The circuit court made the same ruling, and we affirm.

¶ 2. This case comes to us on appeal from a judgment on the pleadings. We review such a judgment de novo; it presents a question of law. Commercial Mortgage & Fin. Co. v. Clerk of the Circuit Court, 2004 WI App 204, ¶ 9, 276 Wis. 2d. 846, 689 N.W.2d 74. Because a judgment on the pleadings is essentially a summary judgment without affidavits or other supporting documents, we employ a similar methodology. Id., ¶ 10. We first look at the complaint to determine whether it states a claim. Id. In doing so, we construe the complaint liberally, accepting as true all facts alleged and drawing all reasonable inferences from those facts in the plaintiffs favor. See Freedom from Religion Found., Inc. v. Thompson, 164 Wis. 2d 736, 741, 476 N.W.2d 318 (Ct. App. 1991). If the complaint states a claim, we determine whether the responsive pleading reveals any material factual issues. Commercial Mortgage & Fin. Co., 689 N.W.2d 74, ¶ 10.

¶ 3. The recitation of facts that follows is based upon a liberal construction of the complaint and other facts not contested by the parties. In 1951, a subdivision plat created the Pioneer Acres Subdivision in Cedar-burg, Wisconsin, including Lots 15 and 16. In 1968, the DNR promulgated a wetlands map that designated these residentially zoned lots as wetlands. Ozaukee county, however, did not adopt the map at that time.

¶ 4. In July 1993, the Helnores were interested in purchasing Lots 15 and 16, but the Ozaukee County Department of Environmental Health (OCDEH) could not determine whether the Helnores would be able to build on these lots and advised them to contact the DNR. On July 16, two weeks before the Helnores bought the property, DNR employee Joanne Kline visited the site at the Helnores' request and informed them that no building permits from the DNR would be necessary because of the property's residential zoning; she mentioned nothing about whether the couple's planned improvements would disturb or encroach upon any wetlands. Although she sent the Helnores a follow-up letter three days later, which included a wetlands map of the area, the letter did not state that they would be precluded from building anything on the site. On July 30, the Helnores purchased the two lots.

¶ 5. After the Helnores bought Lots 15 and 16, they obtained all of the necessary permits from the town and the county and made several improvements. They built their house, a storage shed, a gazebo, a bridge, a lawn shed, and a pump house on Lot 15 and a pond spanning both lots. In 1994, some time after the Helnores had obtained their permits, Ozaukee county enacted its Shoreland Zoning Ordinance, which adopted the DNR's 1968 wetlands map.

¶ 6. The Helnores learned of restrictions on their property created by the wetlands map in October 2002. They had applied to the OCDEH in September for a sanitary permit for Lot 16 so that they could build a home for their daughter. Ozaukee county denied that permit in early October, informing the Helnores that the reason for such denial was the classification of Lot 16 as wetlands on the DNR map.

¶ 7. Three days after the Helnores heard from the county, they received a letter from Cherie Weiloch, a DNR employee. The letter, which the complaint appears to incorporate by reference, stated that the Helnores' properties consisted "almost entirely of wetlands." It informed them that the lot on which they planned to build — i.e., Lot 16 — did consist entirely of wetlands and was considered unbuildable. The letter advised that the project would require a WQC that the DNR would probably deny; the project would not meet the standards in Wis. Admin. Code ch. NR 103. Weiloch further warned that after-the-fact permits might be required for already-existing improvements on the properties, including a Wis. Stat. ch. 30 permit for the pond and a WQC.

¶ 8. On April 14, 2003, the Helnores commenced suit against the DNR, Kline, and Weiloch (collectively, DNR), alleging that the DNR had effected a regulatory taking of their property without just compensation, contrary to article I, section 13 of the Wisconsin Constitution. The DNR moved for judgment on the pleadings, and on September 22, the circuit court held a hearing on the motion.

¶ 9. In a decision and order dated January 7, 2004, the court granted the DNR's motion. The circuit court first determined that the doctrines of sovereign immunity and primary jurisdiction precluded the Hel-ñores from seeking direct review in the circuit court. According to the circuit court, such review was unavailable, because the legislature had provided that parties aggrieved by the DNR's decisions must pursue judicial review through the procedures set forth in Wis. Stat. ch. 227. The Helnores' takings claim, it asserted, was not ripe because the DNR had not yet had the opportunity to make a final determination relative to the subject properties. The circuit court subsequently filed a judgment incorporating this decision and dismissed the action. The Helnores appeal.

¶ 10. We first examine the complaint to determine whether it alleges sufficient facts to constitute a takings claim. A regulatory taking occurs when a regulation or government action deprives a private landowner of "all or substantially all practical uses of a property." Eberle v. Dane County Bd. of Adjustment, 227 Wis. 2d 609, 622, 595 N.W.2d 730 (1999).

¶ 11. According to the Helnores, the taking occurred in 1994 when Ozaukee county passed the Shore-land Zoning Ordinance. At that point, the DNR wetlands designation directly affected the use of the Helnores' property, effectively rezoning it to preclude residential use. The Helnores cite Mendonca v. DNR, 126 Wis. 2d 207, 376 N.W.2d 73 (Ct. App. 1985), for the proposition that promulgating a wetlands map which affects property can be a taking. At oral argument, attempting to ascertain whether the DNR had engaged in any conduct that could constitute a taking, we inquired of the Helnores' counsel whether, in light of the fact that title had not vested in the DNR, there had been any "final act" on the part of the DNR. Counsel replied that in Mendonca, we held that a "wetland inventory map has a sufficiently direct effect on legally protected interests and therefore is a final decision that is reviewable." See Mendonca, 126 Wis. 2d at 208. Counsel interpreted our holding to mean that adoption of a wetlands map is tantamount to a taking.

¶ 12. We disagree with the Helnores' reading of Mendonca. First, the issue in that case was whether a wetland inventory map had a substantial enough effect on legally protected property interests to constitute an injury for which Wis. Stat. §§ 227.15 and 227.16 — now Wis. Stat. §§ 227.52 and 227.53 — recognized standing to seek review. See generally Mendonca, 126 Wis. 2d 207. Just because we recognized an injury sufficiently direct to confer standing does not mean we implicitly acknowledged this injury as a taking. We note the following language in Mendonca that characterized the injury at stake:

When the DNR designates land as wetland, the county must enact a zoning ordinance in accordance with the designation. Wis. Admin. Code § NR 115.05(2)(b) (1980). The code places severe use restrictions on shoreland-wetland zoning districts. Wis. Admin. Code § NR 115.05(3) (1980). This mandate to rezone, coupled with the severe use restrictions, causes the petitioners direct and tangible harm.... [T]he petitioners here stand to suffer the direct and certain harm of severely restricted land use and property value decline.'

Mendonca, 126 Wis. 2d at 210. A restriction can severely restrict land use and adversely affect the property's value without depriving the owner of substantially all use of the property. Thus, the language in our decision does not support the proposition that merely adopting a wetland inventory map inflicts an injury rising to the level of a taking.

¶ 13. Second, the case law makes clear that a plaintiff does not have a ripe takings issue when an administrative agency merely promulgates a new regulation. It is generally not enough for a regulation to be applicable; rather, it must have actually been applied by the relevant agency. In Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172, 186 (1985) (hereafter Williamson County), the United States Supreme Court concluded that the respondent's Fifth Amendment takings claim was not ripe "[b]ecause respondent ha[d] not yet obtained a final decision regarding the application of... zoning ordinance and subdivision regulations to its property." The Court reaffirmed Williamson County in Palazzolo v. Rhode Island, 533 U.S. 606 (2001). It stated:

[A] landowner may not establish a taking before a land-use authority has the opportunity, using its own reasonable procedures, to decide and explain the reach of a challenged regulation.... [A] takings claim . . . depends upon the landowner's first having followed reasonable and necessary steps to allow régulatory agencies to exercise their full discretion in considering development plans for the property, including'the opportunity to grant any variances or waivers allowed by law. As a general rule, until these ordinary processes have been followed the extent of the restriction on property is not known and a regulatory taking has not yet been established.

Id. at 620-21. Our own courts have applied the Williamson County rule to takings claims based on article I, section 13 of the Wisconsin Constitution. See Eberle, 227 Wis. 2d at 638; Schlieper v. DNR, 188 Wis. 2d 318, 323, 525 N.W.2d 99 (Ct. App. 1994) ("Without an adverse ruling by an administrative body on a specific property, the administrative body cannot be considered to have yet committed a wrong regarding application of regulations to that property owner." (Emphases added.)).

¶ 14. Based on the foregoing discussion, the DNR did not take the Helnores' properties in 1994. Even if we assume that the county's adoption of the 1968 wetlands map is imputable to the DNR and effectively rezoned the property, neither the DNR nor the county specifically enforced the wetlands designation against the Helnores' properties. Neither entity made any sort of specific determination in 1994 with respect to what uses or activities it would permit on Lots 15 and 16 of the Pioneer Acres Subdivision.

¶ 15. The Helnores appear to have an alternative theory about when the taking of thfeir property occurred, namely, when they received the October 2002 Weiloch letter. In discussing the takings issue, they allude to this letter at several points. Weiloch informed them in this letter that their proposed project — i.e., constructing a home for their daughter on Lot 16— would require a WQC that the DNR was unlikely to grant, given that the DNR considered the property, which lay on wetlands, unbuildable. We understand the Helnores to argue that the Weiloch letter constituted enforcement of the wetlands map and that such enforcement reversed previously permissible uses so as to effect a taking.

¶ 16. We reject this argument. Although this alternative theory seems to recognize the importance of specific application of wetland regulations against the subject properties, we determine that the Weiloch letter does not constitute "an adverse ruling by an administrative body on a specific property." See Schlieper, 188 Wis. 2d at 323. With respect to existing improvements, the letter merely warns that after-the-fact permits might be required and that the Helnores "will be required to ... potentially conduct site restoration for activities that required Department authorization." In the meantime, they continue to reside in the home they built on Lot 15 and to retain full enjoyment of that property. As to the WQC for the Helnores' proposed construction, the letter indicates only that the DNR is unlikely to issue such a permit, based on the water quality standards in Wis. Admin. Code ch. NR 103. "Might," "potentially," and "unlikely" do not "decide and explain the reach of a challenged regulation." See Palazzolo, 533 U.S. at 620.

¶ 17. We read the letter as merely Weiloch's prediction about the result the DNR would reach if the Helnores attempted to apply for a WQC for their proposed project. Like many "zoning" regulations, the rules applicable to property within a wetlands designation appear to be subject to the kind of variances and waivers that Palazzolo contemplated. See id. at 620-21 (Property owners must take "necessary steps to allow regulatory agencies to exercise their full discretion in considering development plans for the property, including the opportunity to grant any variances or waivers allowed by law." (Emphasis added.)). We first note the following exchange from the oral argument with counsel for the DNR.

[Court] You were talking earlier about how ... it's not a given that the water quality permit will be denied, that there are instances where it can be ... once the facts are known where there can be conditions attached. Is that how you read this rule... to allow whoever makes this decision to grant the certification but with conditions?
[DNR's Counsel] Yes, and the conditions have to be there because ... there are occasions when the Department believes it's in the best interest of the public and the private folks involved to provide some flexibility . .. to the extent that flexibility is allowed in the standards, and it is.
Sometimes small amounts of wetlands can be filled and other more valuable wetlands are preserved or enhanced. There are ways to ensure that the standards are met in most situations. There are some times where you might not be able to build at all. But I read [Wis. Admin. Code § NR] 299.05 in conjunction with 299.04 that sets forth those standards and in (b)6., they note public interest and public rights standards set forth in chapters 30 and 31 and elsewhere in the statutes, and those standards have to include a balance of public and private rights which enables the Department to also take into account relevant equitable facts raised by the property owners. So I do believe that there is some flexibility ... depending on the strength of the evidence the Helnores provide and present in terms of what they were told in 1993 before they bought their property.

¶ 18. Second, we note the provisions in Wis. Admin. Code ch. NR 299 to which counsel refers. Chapter NR 299 is entitled, "WATER QUALITY CERTIFICATION." Wisconsin Admin. Code § NR 299.04 includes several factors the DNR must consider in reviewing a WQC application, including public interest and public rights standards set forth in various parts of the Wisconsin Statutes. See § NR 299.04(l)(b)6. Wisconsin Admin. Code § NR 299.05 states that any denial must explain why the DNR lacks reasonable assurances that § NR 299.04 will be satisfied. Sec. NR 299.05(3)(e). It also requires grants or conditional grants of certification to include: (1) a statement that the DNR has reasonable assurances that the requirements of § NR 299.04 will be satisfied and (2) any conditions the DNR imposes. See § NR 299.05(3)(d). We read these provisions to mean that even if the Helnores proposed use might not comply with ch. NR 299 "as is," the DNR may be able to impose some additional conditions or alter the proposal in such a way as to allow construction while ensuring that the Helnores' use of their property complies with the law.

¶ 19. We find further support for the notion that the DNR might allow variances as to the Helnores' parcels in Wis. Admin. Code ch. NR 103, "WATER QUALITY STANDARDS FOR WETLANDS." This chapter applies to Wis. Admin. Code ch. NR 299 WQC determinations. Wis. Admin. Code § NR 103.06(l)(c). The DNR looks to the factors listed in Wis. Admin. Code § NR 103.08(3) when it determines whether a proposal conforms to the requirements of ch. NR 103. Notwithstanding the failure of a proposal to meet those requirements, however, the DNR will find the requirements of ch. NR 103 satisfied based on § NR 103.08(4) when (1) no practicable alternative to the proposed use would avoid adverse impacts to wetlands, § NR 103.08(4)(a)l.; and (2) the nonconforming uses will not have signifi cant adverse effects of various sorts, see § NR 103.08(4)(a)2. and 3., and (c). Although the Weiloch letter states that the Helnores proposed development does not meet the requirements of this chapter, again, we have no factual basis to conclude that Weiloch considered these factors rather than merely stated her opinion based on whatever preliminary information she had.

¶ 20. Further, as to any after-the-fact permits that the Helnores might need for their already-existent improvements, the DNR indicates it has even greáter flexibility to consider equitable factors. According to the DNR,

It is not a rigid, unforgiving process, particularly with respect to after-the-fact situations. There may be less leeway with ... new proposals or expansions, but as to what already is there and modifications of what is there, the DNR routinely and consistently exercises the discretion allowed it as an enforcement agency and where the substantive law allows it to balance and weigh different factors.

Moreover, the DNR indicated that even if their applications are initially denied, the Helnores may present such evidence of equitable considerations as a matter of right at a contested case hearing. At oral argument, the DNR's counsel first cited to R.W. Docks & Slips v. DNR, 145 Wis. 2d 854, 429 N.W.2d 86 (Ct. App. 1988), a case in which we upheld the circuit court's authority to send the case back to the administrative law judge with instructions to consider equitable factors. Counsel then stated,

The administrative law judges are not courts of equity. However, to the extent that the substantive law allows them to consider equitable factors, they do. And that's why we get after-the-fact permits. That's why they— often as not — change the DNR decisions that they are reviewing based on the evidence that comes before them in the contested case hearing. So they understand the limits of their authority, but they also understand that to the extent the substantive law gives them some leeway, they have an obligation to reach fair decisions that can be upheld by the circuit courts.

Based on what we have heard, we trust that the DNR will consider any equitable facts the Helnores might present and that denial of their various permit applications is not at this point a foregone conclusion.

¶ 21. The Helnores are not left out in the cold with respect to protecting their interests just because they cannot assert a cognizable takings claim. They simply must pursue available administrative relief before resorting to the courts. The Helnores protest that the procedures in Wis. Stat. ch. 227 are inapplicable because they "do not have a traditional DNR 'decision' to review, much less appeal." We note, however, that the reason they have no "traditional DNR decision" from which to appeal through the administrative process is that they have not sought one. The doctrine of prior resort, also called primary jurisdiction, requires that they do so.

¶ 22. The doctrine of prior resort is similar to the exhaustion of administrative remedies doctrine, which requires that where a statute prescribes "a procedure for review of an administrative action and for judicial review of the administrative decision, the courts will consider that remedy exclusive and require that it be employed before other remedies." Fazio v. Dep't of Employee Trust Funds, 2002 WI App 127, ¶ 11, ¶ 11 n.9, 255 Wis. 2d 801, 645 N.W.2d 618. Courts often use the terms interchangeably, but the former applies in cases like this one where there has been a total absence of any formal administrative proceedings. See Nodell Inv. Corp. v. City of Glendale, 78 Wis. 2d 416, 427 n.13, 254 N.W.2d 310 (1977); Fazio, 255 Wis. 2d 801, ¶ 11 n.9. Pursuant to the prior resort doctrine, courts will refuse to intervene "while there remains any possibility of further administrative action." See Nodell, 78 Wis. 2d at 428 n.13 (emphasis added); Fazio, 255 Wis. 2d 801, ¶ 11 n.9 (quoting Nodell; emphasis added).

¶ 23. We conclude that there remains a possibility of further administrative action in this case. The Hel-nores may apply for any required permits. If the DNR denies those permits, the Helnores may proceed pursuant to Wis. Stat. ch. 227. Pursuant to Wis. Stat. § 227.52, any administrative decision that adversely affects their substantial interests is subject to review as provided in this chapter. Wisconsin Stat. § 227.42(1) allows any person to request a contested case hearing so long as

(a) A substantial interest of the person is injured in fact or threatened with injury by agency action or inaction;
(b) There is no evidence of legislative intent that the interest is not to be protected;
(c) The injury to the person requesting a hearing is different in kind or degree from injury to the general public caused by the agency action or inaction; and
(d) There is a dispute of material fact.

See also Wis. Admin. Code § NR 299.05(5) (persons whose substantial interests may be affected by the DNR's decision with respect to a WQC may request a contested case hearing pursuant to ch. 227).

¶ 24. The Helnores appear to contest the applicability of Wis. Stat. § 227.42(1) based on paras, (a) and (d). With respect to § 227.42(1)(a), they assert that although they have sustained a substantial injury to their property interest, as this provision contemplates, "administrative hearings are not the proper forum for addressing this constitutional taking." They further dispute that any issue of material fact exists.

¶ 25. We reject both contentions. First, we have already concluded that no taking has occurred. Denial of a WQC would threaten the Helnores' substantial interest in the use and enjoyment of their property, so Wis. Stat. § 227.42(1) (a) clearly would apply if the DNR rejected a permit application.

¶ 26. With respect to their assertion that no issue of material fact exists, the pleadings indicate otherwise. There are contested facts. For example, the parties dispute whether at the time the Helnores bought Lots 15 and 16 they had notice of restrictions on the properties due to the wetland designation and whether they relied upon representations that no such restrictions applied when they decided to purchase those properties. The DNR also indicated at the oral argument that facts regarding what the Helnores were told in 1993 before they purchased their lots would be "hotly contested." These "hotly contested" facts are material because the DNR looks at considerations of this sort in determining how much flexibility to allow for deviations to applicable regulations.

¶ 27. In sum, "the extent of the restriction ... is not known and a regulatory taking has not yet been established." See Palazzolo, 533 U.S. at 621. We do not know how much of the Helnores' property will ultimately be unusable. The finder of fact simply could not conclude that the Helnores have lost all substantial use of the property without knowing that information. Although we construe the allegations in a complaint liberally, we cannot predict what will happen based on incomplete information. Mere threats of a taking without compensation are not constitutional violations. To the extent that important interests in their property are threatened, Wis. Stat. ch. 227 affords them adequate means to protect those interests through the administrative process. We affirm.

By the Court. — Judgment affirmed.

       Wisconsin Admin. Code ch. NR 103 sets water quality standards for wetlands. All references to provisions contained in ch. NR 103 are to the January 2002 version unless otherwise noted.

       All further references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.

       Presumably, the court was referring to the 1983-84 version of the Wisconsin Statutes.

       These references are to Wis. Admin. Code §§ NR 299.04 and NR 299.05 (Jan. 2003). All further references to Wis. Admin. Code ch. NR 299 are to the January 2003 version unless otherwise noted.

       Counsel refers to Wis. Admin. Code § NR 299.04(1)(b)6.