The SCOW docket: It's all in the timing – WisDOT gets a pass

Note: We are crunching Supreme Court of Wisconsin decisions down to size. The rule for this is that no justice gets more than 10 paragraphs as written in the actual decision. The "upshot" and "background" sections do not count as part of the 10 paragraphs because of their summary and very necessary nature. We've also removed citations from the opinion for ease of reading, but have linked to important cases cited or information about them. ​Italics indicate WJI insertions.

The case: Southport Commons, LLC v Wisconsin Department of Transportation

Majority: Justice Ann Walsh Bradley (18 pages), joined by Justices Rebecca F. Dallet, Brian Hagedorn, and Jill UJ. Karofsky 

Dissent: Justice Patience D. Roggensack (14 pages), joined by Justices Rebecca Grassl Bradley and Annette K. Ziegler

The upshot
We conclude that "occurred"...does not mean "discovered." The notice of claim period begins to run when the damage happens or takes place.

Further, we conclude that Southport failed to meaningfully develop in the circuit court or court of appeals an argument that the damage to its property occurred gradually over a period of years. Instead, it argued only that the notice of claim requirement is triggered by discovery. As a consequence, Southport did not raise a genuine issue of material fact as to the date of damage, and the circuit court properly granted DOT's motion for judgment on the pleadings. 

Background
Southport owns 45 acres of vacant land in Kenosha Cournty. In 2008 and 2009, the state Department of Transportation moved a frontage road, which was entirely east of the property, to a location bisecting the property. 

Southport, according to its suit against WisDOT, had the property surveyed before the project. Three areas of wetlands were identified. In 2016, Southport had the site surveyed again because the firm was interested in its potential for commercial development. The new survey showed six wetland areas, including three new ones. The three that existed before the WisDOT project had significantly increased in size.

Southport alleged that it did not know about the damage to its property before its 2016 survey. It filed a claim against WisDOT in 2017, which the agency ignored. Southport then sued in Kenosha County Circuit Court, asking the court to institute condemnation proceedings to that the firm could be compensated for the damaged property.

Walsh Bradley

The guts

DOT answered the complaint and subsequently moved for judgment on the pleadings. The motion was based on the assertion that Southport failed to file its notice of claim within three years of when the damage occurred as (state law) requires. In response, Southport contended that §88.87(2)(c)...allows a notice of claim to be filed within three years after the damage is discovered, and that its notice of claim was therefore timely. 
                                                                   
(The circuit court and court of appeals sided with WisDOT and dismissed the case. Southport appealed to the Supreme Court.)

We agree with both the approach and the result of the court of appeals. The court of appeals correctly determined that in common and ordinary usage, something "occurs" when it happens or takes place....

It is not only the dictionary that supports such a determination, but it is also our case law. We have previously stated that "[t]he ordinary and common meaning of 'occurrence' is 'something that takes place; something that happens unexpectedly and without design.'"...The common usage of the word "occurred" thus has no element of discovery as Southport contends.

When the legislature wants to make discovery the trigger for a statutory filing requirement, it knows how to do so. Indeed, it has done so in other areas of the Wisconsin Statutes.... 

We turn next to examine the pleadings and arguments made in this case....

Southport alleges that it is the sole owner of the property at issue, that DOT has occupied and taken portions of Southport's property through faulty construction and maintenance of the frontage road, and that DOT did not exercise its power of condemnation. This is sufficient to state an inverse condemnation claim....

Inverse condemnation occurs when a property owner petitions the a court to begin  condemnation proceedings against the property. It's generally done when an agency with the power to condemn a property did not do so but destroyed its value anyway.

With no allegation that the damage occurred within the three years prior to the filing of the notice of claim, and no supporting materials placing such a fact in issue, we must determine that judgment on the pleadings was properly granted by the circuit court. In other words, there is no genuine issue of material fact as to the date of the damage because Southport did not allege such a factual dispute. Southport put all of its eggs in the basket of "discovery" and did not meaningfully develop in either the circuit court or court of appeals any argument that the damage occurred surreptitiously over time. As such, it would be improper for this court to rely on such a basis here.

Further, it would not have taken much to raise an issue of material fact. In response to DOT's motion for judgment on the pleadings, Southport could have filed an affidavit placing the date of damage in issue and thus converted the motion for judgment on the pleadings to a motion for summary judgment....Similarly, it could have alleged surreptitious damage over time in the complaint or moved to amend the complaint after DOT filed its motion.....

When DOT filed its motion for judgment on the pleadings, Southport needed to do something to create a factual dispute. Arguing only that "occurred" means "discovered" was not sufficient. ​

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Roggensack

The dissent

Southport was not required to plead when damage occurred in order to make a valid claim for inverse condemnation....

As the movant, DOT had the burden to prove that it was entitled to judgment on the pleadings. Furthermore, failing to comply with a notice of claim statute is an affirmative defense. The pleadings do not provide the proof necessary for DOT to prevail on its affirmative defense.

I write in dissent because basic rules of civil procedure that control when judgment on the pleadings may be granted have been disregarded by three courts. In addition, the majority opinion creates a new element for an inverse condemnation claim and converts an affirmative defense into a pleading requirement for Southport. When this court disregards basic rules of civil procedure, changes pleading rules and overrules precedent of this court without so much as a by-your-leave in order to obtain the outcome it prefers, it causes confusion throughout the court system that goes far beyond Southport's claim for inverse condemnation....

A review of the record shows that the circuit court actually did not conclude that the Verified Complaint failed to state a claim for inverse condemnation. Rather, the circuit court concluded, at DOT's urging, that Wis. Stat. § 88.87(2)(c) created a three-year statute of repose starting when DOT completed the construction project on Southport's property. Because Southport filed its notice of claim with DOT after that three-year period, the circuit court dismissed its inverse condemnation claim. The majority opinion does the same thing....

There can be no question that the Verified Complaint stated a claim for inverse condemnation. The majority opinion initially agreed with my conclusion....

The majority opinion then morphs into discussing a fact that Southport was not required to plead in order to state a claim for inverse condemnation. The majority opinion is creative in how it gets around basic rules of civil procedure. First, it concludes that Southport stated a claim for inverse condemnation, then it adds a new requirement to pleadings for inverse condemnation....Because Southport did not allege "the date of the damage," the majority grants what it labels judgment on the pleadings to DOT....

Maple Grove (a case precedent) teaches that timeliness of compliance with a notice of claim statute was DOT's issue to raise as an affirmative defense. And, as an affirmative defense, it was DOT's burden to prove that notice was not timely. 

The reader should take note that the majority opinion actually is making two legal determinations that are quite different from what one would ascertain by simply reading the quoted words. First, the majority opinion has added a new required element for an inverse condemnation claim, the date the damage occurred. There is no support for this in Wis. Stat. § 32.10 which establishes the elements of an inverse condemnation claim, or for that matter, in the reasoning of the majority opinion. It is just a way to get the result the majority prefers. Second, the majority opinion converted an affirmative defense, noncompliance with a notice of claim statute, into a pleading obligation for a plaintiff in an inverse condemnation claim. All of this is new law that has no legal foundation, (and) ignores basic rules of civil procedure....  

DOT's motion for judgment on the pleadings actually was a motion for judgment on its affirmative defense. Intertwined with that defense are factual questions about DOT's ongoing maintenance of 120th Avenue and whether that maintenance factually affected Southport's damage. There also are legal questions about the meaning of "occurred" during construction  and how that term is interpreted when continued damage is alleged to have been caused by DOT's on-going maintenance of 120th Avenue.

It is not possible to decide the legal questions of statutory interpretation before deciding the factual questions about which types of actions by DOT caused damage to Southport. Therefore, DOT's affirmative defense cannot be determined solely by review of the pleadings. Accordingly, DOT did not carry its burden as proponent of the affirmative defense and its motion should have been denied. ​

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