Mayhugh v. State
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Plaintiff, an inmate at Redgranite Correctional Institution, was injured during a baseball game in Redgranite’s recreational yard. Plaintiff filed a complaint against the State, the Department of Corrections (DOC), and Redgranite. The circuit court dismissed Plaintiff’s tort action against the State and the DOC, concluding that recovery was barred by the doctrine of sovereign immunity. The court of appeals affirmed. The Supreme Court affirmed the court of appeals’ determination that Plaintiff’s suit against the DOC was barred by sovereign immunity, holding (1) the DOC is not independent from the State, and therefore, the DOC was entitled to the sovereign immunity accorded to the State; and (2) the statutory grant of power to the DOC to sue and be sued should not be interpreted as an express waiver of the DOC’s sovereign immunity.
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2015 WI 77 SUPREME COURT CASE NO.: COMPLETE TITLE: OF WISCONSIN 2013AP1023 Adam R. Mayhugh, Plaintiff-Appellant-Petitioner, v. State of Wisconsin, Wisconsin Department of Corrections and Redgranite Correctional Institution, Defendants-Respondents, Gary Hamblin, Michael A. Dittmann, John A. Doe, John B. Doe, ABC Engineering Company, DEF Construction Company, GHI Insurance Company, JKL Insurance Company, MNO Insurance Company and PQR Insurance Company, Defendants. REVIEW OF A DECISION OF THE COURT OF APPEALS (No cite) OPINION FILED: SUBMITTED ON BRIEFS: ORAL ARGUMENT: July 10, 2015 March 10, 2015 SOURCE OF APPEAL: COURT: COUNTY: JUDGE: Circuit Waushara Guy D. Dutcher JUSTICES: CONCURRED: DISSENTED: NOT PARTICIPATING: GABLEMAN, J., concurs. (Opinion Filed.) ATTORNEYS: For the plaintiff-appellant-petitioner, there were briefs by Nicholas Andrew Wagener and Bollenbeck Fyfe SC, Appleton, and oral argument by Nicholas Andrew Wagener. For the defendants-respondents, the cause was argued by Karla Z. Keckhaver, assistant attorney general, with whom on the brief was Brad Schimel, attorney general. 2 2015 WI 77 NOTICE This opinion is subject to further editing and modification. The final version will appear in the bound volume of the official reports. No. 2013AP1023 (L.C. No. 2012CV124) STATE OF WISCONSIN : IN SUPREME COURT Adam R. Mayhugh, Plaintiff-Appellant-Petitioner, v. State of Wisconsin, Wisconsin Department of Corrections and Redgranite Correctional Institution, FILED Defendants-Respondents, JUL 10, 2015 Gary Hamblin, Michael A. Dittmann, John A. Doe, John B. Doe, ABC Engineering Company, DEF Construction Company, GHI Insurance Company, JKL Insurance Company, MNO Insurance Company and PQR Insurance Company, Diane M. Fremgen Clerk of Supreme Court Defendants. REVIEW of a decision of the Court of Appeals. ¶1 ANN WALSH BRADLEY, J. Affirmed. Petitioner, Adam R. Mayhugh, seeks review of an unpublished decision of the court of appeals affirming an order of the circuit court that dismissed his tort action against the State and the Department of Corrections No. (DOC).1 2013AP1023 The court of appeals agreed with the circuit court that recovery was barred by the doctrine of sovereign immunity. ¶2 Mayhugh apply to the DOC. contends that sovereign immunity does not He maintains that by granting the DOC broad powers, the legislature established the DOC as an independent going concern. Based on his determination that the DOC is independent from the state, Mayhugh concludes that the DOC is not entitled to the sovereign immunity accorded to the state. In the alternative, Mayhugh asserts that the statutory grant of power to the DOC to sue and be sued should be interpreted as an express waiver of sovereign immunity. ¶3 immunity. We conclude that DOC is entitled to sovereign The DOC lacks sufficient attributes to render it an independent going concern. powers, the the character of Despite the breadth of its statutory those powers reveals that the legislature did not intend the DOC to be anything other than an arm of the state. ¶4 We further conclude that the legislature expressly waived the DOC's sovereign immunity. has not Wisconsin Stat. § 301.04 (2011-12),2 which permits the DOC to sue and be sued, is not an express waiver of the DOC's tort immunity but rather addresses the DOC's capacity to be sued. Accordingly, we affirm 1 Mayhugh v. State, No. 2013AP1023, unpublished slip op. (Wis. Ct. App. June 3, 2014) (affirming order of the circuit court for Waushara County, Guy D. Dutcher, Judge). 2 All subsequent references to the Wisconsin Statutes are to the 2011-12 version unless otherwise indicated. 2 No. 2013AP1023 the court of appeals' determination that Mayhugh's suit against the DOC is barred by sovereign immunity. I ¶5 In 2011 Mayhugh, then an inmate at Redgranite Correctional Institution (Redgranite), attended a baseball game in Redgranite's recreational yard. Staff directed him to sit in the bleachers to watch the game. While he was sitting there, one ball, of the players hit a foul bleachers and hit Mayhugh in the head. which flew into the As a result, Mayhugh suffered a fracture to his right temporal lobe and a severed artery that led to a blood clot, strokes, and acute respiratory failure. ¶6 Mayhugh subsequently filed a complaint against the state of Wisconsin, the DOC, Redgranite, unnamed construction and engineering companies, and unnamed insurers. alleged negligence in the design of the The complaint baseball field and asserted that spectators were not protected from foul balls, that Redgranite failed to remedy the situation, and that Mayhugh was injured as a result. ¶7 The DOC moved for dismissal, arguing that as a state agency it was entitled to sovereign immunity. It explained that the state had not consented to suit and therefore the court lacked personal jurisdiction. ¶8 After Mayhugh amended the complaint to include the Secretary of the DOC, the warden of Redgranite, and two unnamed officers as defendants, the DOC dismiss. It again claimed sovereign immunity. 3 submitted another motion to Additionally, it No. asserted that requirements Mayhugh for had suits failed against to state comply 2013AP1023 with employees the and notice therefore failed to state a claim against them. ¶9 The circuit court granted the DOC's motion. The court agreed with the DOC that it was entitled to sovereign immunity under the Wisconsin Constitution unless the state had waived such immunity by consenting to be sued. It observed that although the legislature had provided that the DOC could "sue and be sued," a number of authorities have declined to construe such language as a waiver. It then concluded that the State had not The court with the consented Mayhugh to failed suit. to comply against state employees. further notice determined statute for that suits Accordingly, it determined that it lacked jurisdiction over the state employee defendants. ¶10 to Mayhugh appealed the portion of the decision relating sovereign sovereign immunity. immunity is He contended unavailable that because the the defense of DOC an independent going concern and not an arm of the state. is In the alternative, he advanced that the legislature waived sovereign immunity for the DOC by enacting Wis. Stat. § 301.04, which permits the DOC to sue and be sued. ¶11 court. The court of appeals summarily affirmed the circuit Mayhugh v. State, No. 2013AP1023, unpublished slip op. (Wis. Ct. App. June 3, 2014). It observed that in Lindas v. Cady, 142 Wis. 2d 857, 861-63, 419 N.W.2d 345 (Ct. App. 1987), aff'd in part, rev'd in part, 150 Wis. 2d 421, 441 N.W.2d 705 (1989), it determined that the phrase "sue and be sued" was not 4 No. consent for suit against the DOC's predecessor Department of Health and Human Services. 2013AP1023 agency, Id. at 2. the Given that holding, it concluded that the language in Wis. Stat. § 301.04 was not a waiver of sovereign immunity. Id. The court of appeals further determined that the DOC was not an independent political body or an independent state agency, and therefore was not exempted from sovereign immunity. Id. at 3. II ¶12 this We are asked to determine whether the circumstances of case rendering fall within sovereign Specifically, either immunity whether the of the two inapplicable legislature asserted to a created scenarios state the entity. DOC in a manner that renders it an independent going concern, which acts neither as the state's arm nor its agent, and whether the legislature has expressly waived the DOC's sovereign immunity. Both of these issues present questions of law which we review independently of the decisions rendered by the circuit court and court of appeals. Canadian Nat'l R.R. v. Noel, 2007 WI App 179, ¶5, 304 Wis. 2d 218, 736 N.W.2d 900. III ¶13 immunity entity. We begin with the first scenario rendering sovereign inapplicable: the creation of an independent state The sovereign immunity derived from Article IV, Section 27 of the Wisconsin Constitution protects the state from suit. Lister v. Bd. of Regents, 72 Wis. 2d 282, 291, 240 N.W.2d 610 (1976). action Generally, against a for state purposes agency or 5 of sovereign board is immunity, deemed an an action No. against the state. Bahr v. State Inv. Bd., 186 Wis. 2d 379, 387-88, 521 N.W.2d 152 (Ct. App. 1994). creates an entity 2013AP1023 independent from However, when the state the state, which acts as neither its arm nor its agent, such entity falls outside the protection of sovereign immunity. Majerus v. Milwaukee Cnty., 39 Wis. 2d 311, 315, 159 N.W.2d 86 (1968). such entities as "independent going Cases often refer to concerns." See, e.g., German v. Wisconsin DOT, 2000 WI 62, ¶18, 235 Wis. 2d 576, 612 N.W.2d 50; Townsend v. Wisconsin Desert Horse Ass'n., 42 Wis. 2d 414, 424, 167 N.W.2d 425 (1969); Majerus, 39 Wis. 2d at 314. ¶14 This court first referred to independent going concerns in Sullivan v. Bd. of Regents, 209 Wis. 242, 244 N.W. 563 (1932). of Regents, There, the plaintiff brought suit against the Board asserting that the State had waived sovereign immunity by creating the Board as a body corporate. The court disagreed, stating that although the Board was a body corporate, it was merely an arm of the state. ¶15 Id. at 244. To explain its conclusion, the court observed that the Board lacked the following attributes: it had "no power to raise money by taxation"; it could "not incur any liability beyond the amount appropriated to it by act of the legislature"; "the title to all property acquired by [the Board] is held by it in trust for the state"; the Board "may not dispose of real property without express authority from the state"; "[the Board's] power to dispose of personalty is limited"; and "[a]ll funds belonging to the institution, whether derived from appropriations or from the sale of property, are in the custody of the state treasurer 6 No. 2013AP1023 and can only be disbursed on a warrant drawn by the secretary of state." Id. at 244. ¶16 The absence of these attributes indicated that if the plaintiff were to recover a judgment against the Board, "there would be no property out of which execution could be satisfied." In other words, if the Board created liability, "it is a liability of the state and must be enforced as other liabilities against the state are enforced." court determined that Id. at 245. nothing in the Accordingly, the statutes indicated any intention that the Board be an independent going concern, and sovereign immunity applied. ¶17 Id. at 244. As Sullivan suggests, the determination that a state entity is an independent going concern is a narrow exception to sovereign immunity. Canadian Nat'l R.R., 304 Wis. 2d 218, ¶7. To date, our case law has identified only three entities that fall into Housing this Finance category: the Authority, State and the Armory Board, the State Investment State Board. Majerus, 39 Wis. 2d 311; State ex rel. Warren v. Nusbaum, 59 Wis. 2d 391, 208 N.W.2d 780 (1973); Bahr, 186 Wis. 2d 379. ¶18 In Majerus, 39 Wis. 2d 311, the court considered whether the State Armory Board was an independent going concern. The legislature had designated the Armory Board as "a politic and corporate" with the power "to sue and be sued." at 315. body Id. It had also granted the Board the powers to convey real estate, dispose of personal property, hold and disburse its own funds independent of state warrants, borrow money, and issue and sell bonds and other evidences of indebtedness to accomplish its 7 No. purposes. Id. at 314-15. 2013AP1023 The court acknowledged that an entity need not have all of the powers enumerated in Sullivan in order to be independent. designation of the Id. at 315. Board as a body It determined politic and that the corporate, combined with the Board's broad proprietary powers, rendered it an independent going concern, outside the scope of sovereign immunity. ¶19 Id. The court conducted a similar inquiry with regard to the State Housing Finance Authority in Nusbaum, 59 Wis. 2d 391. It noted that although the legislature had stated that the Authority was "a public body corporate and politic," the court must look beyond that denomination and independently consider "the powers and structure conferred upon the entity in order to determine its nature." ¶20 Id. at 424. The court reviewed the broad proprietary powers the legislature granted to the Authority: The Authority, pursuant to sec. 234.03, is granted all the powers "necessary or convenient" to implement its public purpose, including but not limited to the power to sue and be sued; to have perpetual existence; to make and execute contracts; to incur debt; to acquire and dispose of mortgages or security interests; to acquire leaseholds, real or personal property or any interest therein; and, under certain conditions, to own, hold, clear, improve and rehabilitate and to sell, assign, exchange, transfer, convey, lease, mortgage or otherwise dispose of or encumber the same. Id. at 424. Turning its attention to the fiscal powers, the court continued: The Authority has the power to hold and disburse its own funds independent of state warrants. It has the power to borrow money and issue and sell bonds and 8 No. 2013AP1023 other evidences of indebtedness to accomplish its purposes. Its debts thus created are satisfied out of rents and interest the Authority receives from the property the Authority acquires and the investments it makes. Id. Acknowledging that the proprietary and fiscal powers supported the legislature's declaration that the Authority was an independent entity, the court determined that the Authority "is neither an arm nor agent of the state." ¶21 Id. at 425. Likewise, the State Investment Board was declared an independent going concern in Bahr, 186 Wis. 2d 379. To support this determination, the court identified the following statutory features of the Board: its broad authority to manage and invest, sell, reinvest, and collect income and rents, to employ outside counsel and contractors, and to acquire, manage, and sell real estate without Department of Administration (DOA) participation; the power to sue and be sued; the legislature designated it as a body corporate, and the legislature's stated intent that the Board be an independent agency of the state. Id. at 396, 399. Thus, the court determined that the Board was "ineligible to raise the defense of sovereign immunity." ¶22 Majerus, determining Nusbaum, whether a and state Bahr entity is Id. at 399. demonstrate an that independent in going concern, courts should consider both the character and breadth of the statutory powers granted to the entity. the entities at issue in those cases We observe that shared some common features: they were authorized to sue and be sued, they were created as a body corporate or politic, they had powers indicating budgetary autonomy, and they had the power to hold 9 No. and convey real combination of estate. features Although will the generally 2013AP1023 presence weigh in of this favor of independence and therefore ineligibility for sovereign immunity, we caution that it is a totality of the circumstances analysis and no one factor is determinative. ¶23 Applying these factors to the DOC, we conclude that it is not an independent going concern. The DOC has only one of the attributes identified in Majerus, Nusbaum, and Bahr: the ability to sue and be sued. body politic or body The DOC was not established as a corporate. Additionally, it lacks budgetary autonomy as it is funded by general state revenue, has a budget controlled by the appropriation process and the DOA, and cannot incur any liability beyond the amount appropriated to it. Wis. Stat. §§ 16.50(1)(a), 20.410, 301.10. Further, the DOC is subject to state controls in the purchase of real estate, 301.235(2)(a). goods, and services. Wis. Stat. §§ 16.848, We could find no other statutory powers that would suggest that the DOC is anything other than an arm of the state. ¶24 The various statutory powers identified by Mayhugh do not support his assertion that the DOC is an independent going concern. Specifically, Mayhugh points to a number of the DOC's 10 No. statutory powers relating to managing finances3; 2013AP1023 the DOC's limited contracting power4; the DOC's limited powers with respect to real estate5; and the DOC's general purpose, right to govern 3 Wis. Stat. § 301.10 (the power to audit bills and make payments); Wis. Stat. § 301.075 (authorization to withdraw or disburse moneys deposited in a public depository to the credit of the DOC); Wis. Stat. § 301.085 (the power to make benefit payments and charge counties for making those payments); Wis. Stat. § 301.105 (the power to collect commissions from telephone companies); Wis. Stat. § 301.12 (the power to enforce and seek judgments, compel payments, charge interest, present documents in court to seek payment, and appoint counsel to seek enforcement of collection and deportation); Wis. Stat. § 301.05 (the DOC's ability to accept gifts, grants, or donations, and to hold money in trust). 4 Wis. Stat. § 301.065 (power to contract with religious organizations); Wis. Stat. § 301.07 (power to contract with the federal government); Wis. Stat. § 301.031 (contracting powers for youth programs); Wis. Stat. § 301.08 (power to contract for the purchase of goods, care, and services for incarcerated individuals and individuals supervised by the DOC). 5 Wis. Stat. § 301.235 (the authorization to construct and refinance indebtedness for construction of new buildings, convey title on property owned by the DOC, lease property and assign revenues coming in from the properties); Wis. Stat. § 301.24 (condemnation power to acquire land, sell excess land, purchase land and lease land); Wis. Stat. § 301.37 (design control and approval authority over various facilities in Wisconsin). 11 No. and a number of powers control of inmates6. ¶25 First, the relating to the care, 2013AP1023 custody, and We address each in turn. financial powers referred to by Mayhugh must be considered in light of the fact that the DOC's funds are controlled process. by the legislature Wis. Stat. § 20.410. through the appropriations Additionally, the DOC cannot pay its bills until they have been audited under the supervision of the DOA. Wis. Stat. § 301.10. Further, all payments must be made on the warrant of the DOA. Id. Thus, the overarching character of the DOC's budget does not support a conclusion that the DOC is independent of the state. ¶26 Likewise, the contracting powers identified by Mayhugh do not convince us that the DOC is independent. These powers are limited to contracts with specific parties and contracts for specific purposes. Notably, the DOC's ability to contract for youth programs is limited to available revenues and subject to 6 Wis. Stat. § 301.001 (purpose of avoiding sole reliance on incarceration); Wis. Stat. § 301.03 (general corrections authority); Wis. Stat. § 301.02 (power to maintain and govern correctional institutions); Wis. Stat. § 301.055 (power to limit the number of prisoners); Wis. Stat. § 301.29 (police powers); Wis. Stat. § 301.025 (power to establish a separate division for juveniles); Wis. Stat § 301.06 (power to set up its own educational system); Wis. Stat. § 301.30 (power to setup an independent wage scale for inmates). Wis. Stat. § 301.035 (the establishment of a DOC division for hearings and appeals related to parole and probation); Wis. Stat. § 301.045 (the DOC's power to investigate, hold hearings, subpoena witnesses and make recommendations to public or private entities). 12 No. 2013AP1023 the review and approval of the legislature's joint committee on finance. Wis. Stat. § 301.031(2g). Its ability to contract with religious organizations is subject to DOA provisions. Stat. § 301.065(2). Wis. Further, as noted above, payments for the DOC's contracts must be made on the warrant of the DOA. Stat. § 301.10. Overall, the limited contracting Wis. powers identified by Mayhugh do not evince an independent character of the DOC. ¶27 Additionally, contrary to Mayhugh's assertion, the real estate powers he identifies reveal that the DOC is not independent from the state. The DOC cannot sell land on its own, but must first seek approval of the Building Commission or the Joint Committee on Finance. Similarly, before purchasing Wis. Stat. § 301.24(4), (4m). land, the DOC must obtain the approval of and release of state building trust funds by the Building Commission. character support of the the Wis. Stat. § 301.24(5). DOC's powers conclusion that with it is Thus, the overall respect to real estate dependent on rather than independent of the state. ¶28 Considering the DOC's general purpose and the powers granted to it to fulfill that purpose, we fail to see how they support concern. a conclusion Rather than that the DOC suggesting is an independent independence, the going statutory statement of purpose reveals that the legislature intended the DOC to be intertwined with other state programs: The purposes of this chapter and chs. 302 to 304 are to prevent delinquency and crime by an attack on their 13 No. 2013AP1023 causes; to provide a just, humane and efficient program of rehabilitation of offenders; and to coordinate and integrate corrections programs with other social services. In creating the department of corrections, chs. 301 to 304, the legislature intends that the state continue to avoid sole reliance on incarceration of offenders and continue to develop, support and maintain professional community programs and placements. Wis. Stat. § 301.001 (emphasis added). Further, by framing the statement of purpose in terms of the purpose of the state, as opposed to the purpose of the DOC, the statute suggests a legislative intent that the DOC operate as an arm of the state, rather than an independent agency. ¶29 The power to govern correctional institutions and the powers relating to the care, custody, and control of inmates do not weigh in favor of or against DOC independence. These powers are entities akin to those granted fulfill their purpose. to other governmental to The Board of Regents, for example, has similar powers to govern its system, determine the educational systems offered police within authority, personnel. fix that system, salaries, set and hold admission policies, hearings Wis. Stat §§ 36.09(1), 36.11(2), 36.115. for its Even with these powers the Board of Regents is not an independent going concern. Lister, 72 Wis. 2d at 292. These types of powers have not been mentioned in our jurisprudence relating to independent going concerns and say little about whether an entity is independent from the state. ¶30 arguments Finally, Mayhugh bases a significant portion of his on the statutes permitting 14 the DOC to set up and No. regulate the Prison Industries Board. 2013AP1023 Wis. Stat. § 303 et seq. However, that Board is but a segment of the DOC and is not itself the entity being sued. ¶31 We acknowledge that the Prison Industries Board has some budgetary autonomy. See George v. SC Data Ctr., 884 F. Supp. 329, 330 (W.D. Wis. 1995) (explaining that revenues from the sale of goods and services produced are applied to service debt on any bonds issued under the authority of the legislature to finance Prison Industries programs). state However, there is no indication that the revenues produced by the prison industries are the primary source of funding for the DOC as a whole. To the contrary, the Prison Industries Board receives appropriations from the state for prison industries costs that are not covered by its revenues, suggesting that its revenues may not even cover its own operations. 20.866(2)(uy). Wis. Stat. §§ 20.410, Therefore, the statutory powers of the Prison Industry Board do not support a conclusion that the DOC is an independent going concern. ¶32 In sum, the statutory powers granted to the DOC do not render it an independent going concern. Courts must consider both the character and breadth of the statutory powers granted to the entity going concern. when determining whether it is an independent Here, despite their breadth, the character of the DOC's powers reveals that the legislature did not intend for the DOC to be anything other than an arm of the state. IV 15 No. ¶33 2013AP1023 Having established that the DOC is not exempt from sovereign immunity as an independent going concern, we turn to consider whether the state has expressly waived the DOC's sovereign immunity. ¶34 Article IV, Section 27 of the Wisconsin Constitution provides: "The legislature shall direct by law in what manner and in what courts suits may be brought against the state." Courts have traditionally interpreted this language as meaning that the state can be sued only with its consent. Holytz v. City of Milwaukee, 17 Wis. 2d 26, 41, 115 N.W.2d 618 (1962). ¶35 "[C]onsent to suit may not be implied." Wis. 2d at 387. It must be express. Bahr, 186 See German, 235 Wis. 2d 576, ¶17 ("It is axiomatic that the state cannot be sued without the express consent of the legislature."); Metzger v. Wisconsin Dep't of Taxation, 35 Wis. 2d 119, 131, 150 N.W.2d 431 (1967) ("Well established in Wisconsin is the principle that in the absence of express legislative permission the state may not be subjected to suit."); State ex rel. Martin v. Reis, 230 Wis. 683, 685, 284 N.W. 580 (1939) ("it is an established principle of law that no action will lie against a sovereign state in the absence of express legislative permission."). ¶36 We can find no express waiver of the DOC's sovereign immunity. The court of appeals addressed this issue in Lindas, 142 Wis. 2d 857. sovereign In that case, the circuit court dismissed on immunity grounds the plaintiff's suit against the DOC's predecessor, the Department of Health and Social Services. On review, the court of appeals 16 reiterated that "[i]n the No. absence of express legislative authorization, Wisconsin may not be sued." Id. at 861. statute department providing that the 2013AP1023 the State It examined whether a could sue and be sued provided such authorization and determined that it did not. ¶37 was of Id. The court reasoned that the "sue and be sued" statute created "at a time when immunity from tort suits." Wisconsin Id. enjoyed governmental It observed that governmental immunity was subsequently eliminated in Holytz, 17 Wis. 2d 26. It then determined that the fact that Holytz "removed the defense of tort immunity" did not permit it to put more meaning into the sue and be sued statute. 42 Wis. 2d at 420-21). there was no express Id. at 862 (quoting Townsend, Accordingly, the court concluded that consent for tort Department of Health and Social Services. ¶38 Lindas The did consent court not for an set of appeals forth agency to "a and be rule actions. ¶39 DOC, we clarified that sued considered a waiver of sovereign immunity." at 392-93. against the Id. at 863. subsequently blanket sue suit that legislative [could not] be Bahr, 186 Wis. 2d Rather, the holding in Lindas was limited to tort Id. Because we are considering a tort action against the determine that Lindas governs. We acknowledge that unlike the statute at issue in Lindas, the statute permitting the DOC to sue and be sued was enacted after Holytz. However, the current DOC statute was based on the statute discussed in Lindas. It contains identical language. See Wis. Stat. § 301.04 ("The department may sue and be sued."); Wis. Stat. 17 No. § 46.017 (1987-88) ("The department may sue and 2013AP1023 be sued."). Considering this background, we determine that the "sue and be sued" language in Wis. Stat. § 301.04 does not constitute an express waiver of sovereign immunity for tort suits. ¶40 As our statutes recognize, not every entity has the capacity to sue and be sued. Wis. Stat. §§ 802.03, 802.06. In other words, not every entity can be named as a party in a lawsuit. See, e.g., Peirick v. Ind. Univ.-Purdue Univ. Indianapolis Athletics Dep't, 510 F.3d 681, 694 (7th Cir. 2007) (observing that the Athletics Department "is merely a division of the University that is not capable of being sued"). For example, Wis. Stat. § 775.01 provides a procedure for the state to be sued in contract. The "sue and be sued" language in Wis. Stat. § 301.04 clarifies that the DOC could be named in such a suit. ¶41 Other jurisdictions have determined that "sue and be sued" can refer to the capacity to be named in a lawsuit. See Ransom v. St. Regis Mohawk Educ. & Community Fund, 658 N.E.2d 989, 995 (N.Y. 1995) ("statutory power to sue and be sued contained in the D.C. and New York nonprofit corporation laws did nothing more than recognize the Fund's status as an entity with the capacity to enter our courts"); Self v. Atlanta, 377 S.E.2d 674, 676 (Ga. 1989) (sue and be sued "should be read as providing courts, an and entity not as with the waiving status and sovereign capacity immunity"); to enter Town of Highland Park v. Iron Crow Constr., Inc., 168 S.W.3d 313, 318 (Tex. App. 2005) (sue and be 18 sued speaks to an entity's No. 2013AP1023 "capacity to sue and its capacity to be sued when immunity has been waived").7 We agree and conclude that in the context of Wis. Stat. § 301.04 the "sue and be sued" language clarifies that the DOC is a legal entity with the capacity to sue and be sued once immunity has been waived. ¶42 We acknowledge that there is conflicting federal case law regarding the import of "sue and be sued" provisions. Federal Deposit Insurance Corp. v. Meyer, 510 U.S. 471, In 480 (1994), the United States Supreme Court determined that "sue and be sued" clauses are presumed to waive the sovereign immunity absent a showing that the clause was intended to have a more narrow purpose. However, Meyer was addressing sovereign immunity under federal common law and not the sovereign immunity derived from Constitution. Article IV, section 27 of the Wisconsin Accordingly, the federal law on this point is not 7 See also A. Craig Carter, Is Sue and be Sued Language a Clear and Unambiguous Waiver of Immunity?, 35 St. Mary's L.J. 275, 277 (2003-04) (asserting that the "more[] plausible" interpretation of "sue and be sued" is "that it is simply a grant of capacity to be a party to a lawsuit"). 19 No. persuasive.8 2013AP1023 Cf. Federal Housing Admin. v. Burr, 309 U.S. 242, 246-47 (1940) ("State decisions barring garnishment against a public body though it may 'sue and be sued' are not persuasive here as they reflect municipalities, counties purely and local the policies like, concerning and involve considerations not germane to the problem of amenability to suit of the modern federal governmental corporation."). ¶43 Finally, Mayhugh advances that a determination that the DOC is immune from suit would violate Article I, Section 9 of the Wisconsin Constitution, which states that "[e]very person is entitled to a certain remedy in the laws for all injuries, or wrongs which he may receive in his person, property, or character. . . ." ¶44 the The argument that Article I, Section 9 is violated by application of rejected by courts. sovereign immunity has been consistently See, e.g., Forseth v. Sweet, 38 Wis. 2d 676, 688, 158 N.W.2d 370 (1968) (declining to find a violation of Art. I, Sec. 9 because "[t]here is no 'right' of a citizen to 8 This analysis is distinct from that of Bahr v. State Investment Board, 186 Wis. 2d 379, 393-94, 521 N.W.2d 152 (Ct. App. 1994), in which the court referred to language from Federal Deposit Insurance Corp. v. Meyer, 510 U.S. 471, 480 (1994), to support its conclusion that the investment board was an independent going concern. The Bahr court did not separately consider whether the legislature expressly waived sovereign immunity for the board. We are not convinced that Bahr's determination that a "sue and be sued" clause supports a conclusion that an entity is an independent going concern should be extended to an analysis of whether there was an express waiver of sovereign immunity. 20 No. hold his sovereign substantively liable for 2013AP1023 a tort"); Apfelbacher v. State, 160 Wis. 565, 577, 152 N.W. 144 (1915) ("The immunity from suit is a privilege which a sovereign may waive or refuse to waive at its pleasure. No constitutional right of its residents is violated whatever its action in that regard may be."); Erikson Oil Products, Inc. v. State, 184 Wis. 2d 36, 55, 516 N.W.2d 755 (Ct. App. 1994) ("In Cords, 62 Wis.2d at 52, 214 N.W.2d at 411, the court specifically rejected the argument that Wis. Const. art. I, § 9, gave an injured party the right to sue the State and concluded there is no right of a citizen to hold the sovereign liable."). We decline to diverge from this precedent. V ¶45 sovereign In sum, we immunity. conclude The DOC that lacks the DOC is sufficient render it an independent going concern. entitled to attributes to Despite the breadth of its statutory powers, the character of those powers reveals that the legislature did not intend the DOC to be anything other than an arm of the state. ¶46 We further conclude that the state has not expressly waived the DOC's sovereign immunity. Wisconsin Stat. § 301.04, which permits the DOC to sue and be sued, is not an express waiver of the DOC's tort immunity but rather addresses the DOC's capacity to be sued. Accordingly, we affirm the court of appeals' determination that Mayhugh's suit against the DOC is barred by sovereign immunity. 21 No. By the Court.—The decision affirmed. 22 of the court of 2013AP1023 appeals is No. ¶47 MICHAEL J. GABLEMAN, J. 2013AP1023.mjg At issue in (concurring). this case is whether the legislature has waived sovereign, that is state immunity, in tort for injuries sustained by Mayhugh while, as an inmate, he attended a baseball game in Redgranite's recreational yard. I join the majority opinion affirming the court of appeals. The majority correctly determines that the Department of Corrections ("DOC") is not an independent going concern, and that the legislature has not waived the state's sovereign immunity in tort actions. ¶48 I cannot, however, join the majority's reliance on Lindas v. Cady, 142 Wis. 2d 857, 419 N.W.2d 345 (Ct. App. 1987), aff'd in part, rev'd in part, 150 Wis. 2d 421, 441 N.W.2d 705 (1989). Majority Op., ¶¶36-39. Simply put, the majority's reliance on Lindas for its conclusion that "sue and be sued" is not a waiver of sovereign immunity is misplaced because Lindas examined the "sue and be sued" language in Wis. Stat. § 46.017 (1979-80) which applied to the Department of Health and Social Services ("DHSS"), the DOC's predecessor. Here, we examine Wis. Stat. § 301.04,1 which the legislature passed into law after the decision in Lindas and well after our decision in Holytz v. City of Milwaukee, abrogated the 17 Wis. 2d 26, doctrine of 115 N.W.2d 618 governmental (1962), immunity for which tort actions. A. 1 All subsequent references to the Wisconsin Statutes are to the 2011-12 version unless otherwise indicated. 1 No. ¶49 2013AP1023.mjg The rule of governmental immunity, that is municipal immunity, is distinct from sovereign immunity, that is state immunity. Governmental immunity grew out of "English law" and "expanded to the point where the historical sovereignty of kings was relied upon to municipalities." support Id. at 30. a protective prerogative for Governmental immunity was first adopted in Wisconsin in Hayes v. The City of Oshkosh, 33 Wis. 314, 318 (1873). However, applying the doctrine resulted in "some highly artificial judicial distinctions"2 which led this court to re-examine governmental immunity in 1962. Wis. 2d at 32. In Holytz we abrogated the Holytz, 17 doctrine of governmental immunity such that, for municipalities, "so far as governmental responsibility for torts is concerned, the rule is liability—the exception is immunity." ¶50 it came "careful However, our decision in Holytz did not go so far when to the to State and its agencies. distinction . . . between [governmental] party Id. at 39. sue immunity the doctrine state." Id. and at the the 40. Rather, we abrogation made of right of a Thus, following a the private our decision in Holytz, "there will be substantive liability on the part of the state, but the right to sue the state" can be waived 2 "For example, the depending upon whether we involved is 'proprietary' Milwaukee, 17 Wis. 2d 26, municipality may be immune or liable determine that the particular function or 'governmental'." Holytz v. City of 32, 115 N.W.2d 618 (1962). 2 No. 2013AP1023.mjg only by the legislature pursuant to article IV, section 27 of the Wisconsin Constitution.3 Id. at 41. B. ¶51 In Lindas a former employee of DHSS, Lindas, sued the department for wrongful discharge and discrimination. 142 Wis. 2d at 860. Lindas, The circuit court dismissed Lindas's claim as barred by sovereign immunity. Id. Lindas appealed, arguing that by enacting Wis. Stat. § 46.017 (1979-80) the legislature waived DHSS' immunity as the text of § 46.017 (1979-80) stated that "the department [DHSS] may sue and be sued." The Lindas court reasoned that this "sue and be sued" language could not be considered a waiver of sovereign, that is state, immunity in tort because the statute was enacted "at a time when Wisconsin enjoyed governmental immunity from tort suits." Lindas, 142 Wis. 2d at 861. C. ¶52 However, Wis. Stat. § 301.04, the statute at issue in the instant case, was not enacted "at a time when Wisconsin enjoyed governmental immunity from tort suits." Wis. Stat. § 301.04 was enacted in 1989, when Id. the Instead, DOC was created, nearly three decades after the doctrine of governmental immunity was abrogated by this court in Holytz. As a result, the reasoning of Lindas cannot apply to Wis. Stat. § 301.04. If it did, then the interpretation of statutory language would be frozen in time at the moment a court first interprets it. 3 "The legislature shall direct by law in what manner and in what courts suits may be brought against the state." 3 No. ¶53 ultimate This does not interpretation mean, of however, "sue and be that sued" 2013AP1023.mjg the in majority's § 301.04 is incorrect, only that its reliance on Lindas is misplaced and unnecessary. Rather, the majority's conclusion that "sue and be sued" refers to "the capacity to sue and be sued" is wellreasoned and gives full effect to Majority Op., ¶40 (emphasis added). the language of § 301.04. For instance, in Boldt v. State, 101 Wis. 2d 566, 305 N.W.2d 133 (1981), we explained that Wis. Stat. § 775.014 "has been interpreted as giving the state's consent to suit in some causes of action but not in others." Id. at 572 (emphasis added). Specifically, Wis. Stat. § 775.01 waives the state's immunity for actions in contract, and sets forth the manner in which a claim may be brought. See Trempealeau Cnty. v. State, 260 Wis. 602, 605, 51 N.W.2d 499 (1952) (explaining that a contract claim may be brought under Wis. Stat. § 775.01). § 285.01, the predecessor statute to Wis. Stat. Thus, the state's sovereign immunity is waived by the "procedural implementation" of a statute which sets forth 4 The full text of Wis. Stat. § 775.01 is: Upon the refusal of the legislature to allow a claim against the state the claimant may commence an action against the state by service as provided in s. 801.11 (3) and by filing with the clerk of court a bond, not exceeding $1,000, with 2 or more sureties, to be approved by the attorney general, to the effect that the claimant will indemnify the state against all costs that may accrue in such action and pay to the clerk of court all costs, in case the claimant fails to obtain judgment against the state. 4 No. 2013AP1023.mjg the "manner and in what courts suits may be brought against the state." Forseth v. Sweet, 38 Wis. 2d 676, 684, 158 N.W.2d 370 (1968). ¶54 The legislature has not implemented a procedure by which the DOC or the state may be sued in tort, as it has in contract, and therefore, the DOC may not be sued in tort. As a result, the "sue and be sued" language in Wis. Stat. § 301.04 is not a waiver of sovereign immunity, but rather identifies the DOC as an entity that can be named in suits for which legislature has waived sovereign immunity. ¶55 For the foregoing reasons, I respectfully concur. 5 the No. 1 2013AP1023.mjg
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