2021 WI 30
SUPREME COURT OF WISCONSIN
CASE NO.: 2018AP1114
COMPLETE TITLE: Christus Lutheran Church of Appleton,
Plaintiff-Appellant,
v.
Wisconsin Department of Transportation,
Defendant-Respondent-Petitioner.
REVIEW OF DECISION OF THE COURT OF APPEALS
Reported at 389 Wis. 2d 600,937 N.W.2d 63
PDC No:2019 WI App 67 - Published
OPINION FILED: April 1, 2021
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: October 5, 2020
SOURCE OF APPEAL:
COURT: Circuit
COUNTY: Outagamie
JUDGE: Carrie A. Schneider
JUSTICES:
KAROFSKY, J., delivered the majority opinion of the Court, in
which ANN WALSH BRADLEY, DALLET, and HAGEDORN, JJ., joined.
ROGGENSACK, C.J., filed a dissenting opinion, in which ZIEGLER
and REBECCA GRASSL BRADLEY, JJ., joined.
NOT PARTICIPATING:
ATTORNEYS:
For the defendant-respondent-petitioner, there were briefs
filed by Hannah S. Jurss, assistant attorney general; with whom
on the brief was Joshua L. Kaul attorney general. There was an
oral argument by Hannah S. Jurss.
For the plaintiff-appellant, there was a brief filed by
Alan Marcuvitz, Smitha Chintamaneni, Andrea Roschke, and Von
Briesen & Roper, S.C., Milwaukee. There was an oral argument by
Alan Marcuvitz.
An amicus curiae brief was filed on behalf of American
Transmission Company LLC and its corporate manager ATC
Management Inc.; Wisconsin Public Service Corporation, Wisconsin
Electric Power Company, and Wisconsin Gas LLC by Sara K. Beachy
and Axley Brynelson, LLP, Madison.
An amicus curiae brief was filed on behalf of Wisconsin
Realtors Association by Cori Moore Lamont and Wisconsin Realtors
Association, Madison.
An amicus curiae brief was filed on behalf of Owners’
Counsel of America by Joseph C. Niebler, Jr. and Niebler, Pyzyk,
Carrig, Jelenchick & Hanley, LLP, Menomonee Falls; with whom on
the brief was Michael W. Ryan and Ryan and Ryan, Rosemont,
Illinois.
An amicus curiae brief was filed on behalf of Eminent
Domain Services, LLC by Erik S. Olsen and Andrew D. Weininger,
Madison.
2
2021 WI 30
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2018AP1114
(L.C. No. 2017CV452)
STATE OF WISCONSIN : IN SUPREME COURT
Christus Lutheran Church of Appleton,
Plaintiff-Appellant, FILED
v. APR 1, 2021
Wisconsin Department of Transportation, Sheila T. Reiff
Clerk of Supreme Court
Defendant-Respondent-Petitioner.
KAROFSKY, J., delivered the majority opinion of the Court, in
which ANN WALSH BRADLEY, DALLET, and HAGEDORN, JJ., joined.
ROGGENSACK, C.J., filed a dissenting opinion, in which ZIEGLER
and REBECCA GRASSL BRADLEY, JJ., joined.
REVIEW of a decision of the Court of Appeals. Reversed.
¶1 JILL J. KAROFSKY, J. In this case, the Wisconsin
Department of Transportation ("DOT") acquired a portion of land
owned by Christus Lutheran Church of Appleton ("Christus")
through eminent domain. As part of that process, DOT issued a
jurisdictional offer to purchase. We are tasked with
determining the validity of that offer under the requirements of
Wis. Stat. § 32.05 (2017-18).1
1All subsequent references to the Wisconsin Statutes are to
the 2017-18 version unless otherwise indicated.
No. 2018AP1114
¶2 Christus filed the present action asserting that DOT's
jurisdictional offer was invalid because DOT failed to provide
"any appraisal upon which the Jurisdictional Offer of $403,200
is based, as required by Wis. Stat. § 32.05(2)(b) and (3)(e)."
The parties filed competing summary judgment motions. The
circuit court granted DOT's motion and denied Christus' motion,
holding that DOT's jurisdictional offer was based on the initial
appraisal.2 The court of appeals disagreed, reversed the circuit
court's decision, and remanded for further proceedings.3
¶3 We uphold the circuit court's grant of summary
judgment to DOT and conclude that the jurisdictional offer was
valid because it was "based" "upon" an initial appraisal of "all
property proposed to be acquired," pursuant to Wis. Stat.
§ 32.05(2)(a)-(b), and (3)(e). Accordingly, we reverse the
decision of the court of appeals.
I. FACTUAL BACKGROUND AND PROCEDURAL POSTURE
¶4 Christus is a non-profit entity that owns and operates
a church in Greenville that abuts State Trunk Highway 15. As
part of a major project to improve and reconstruct a portion of
the highway, DOT sought to acquire 5.87 acres of Christus'
property and obtain a temporary limited easement of 0.198 acres.
¶5 DOT began the condemnation process with a letter dated
October 3, 2016, advising Christus: "In compliance with
2The Honorable Carrie A. Schneider of the Outagamie County
Circuit Court presided.
3Christus Lutheran Church of Appleton v. DOT, 2019 WI App
67, 389 Wis. 2d 600, 937 N.W.2d 63.
2
No. 2018AP1114
Wisconsin statutes and federal regulations, you are receiving
this letter, along with the enclosed appraisal report, to
initiate negotiations for the acquisition of your property
and/or property interests."4 In that letter, DOT stated that the
estimated fair market value of the property to be acquired was
$133,400, based on a third-party appraisal by Single Source,
Inc.5 DOT provided Christus with an offer in that amount.
¶6 DOT's letter also included an itemized table that
listed the allocations contained in the appraisal. The letter
further informed Christus that if it was not satisfied with the
appraisal's valuation of the property to be condemned, Christus
was "eligible to obtain an additional appraisal from a qualified
appraiser of [its] choice" at DOT's expense within 60 days, by
December 5, 2016, pursuant to Wis. Stat. § 32.05(2)(b).
Additionally, DOT called Christus' representative to encourage
the church to obtain a second appraisal, explaining that "this
was a complex acquisition and even if the two appraisals were
Barbara Halley of MSA Professional Services was DOT's main
4
representative and oversaw the negotiation efforts and
communications with Christus' representative. However, this
opinion will refer to "DOT" generally when discussing the
conversations between the parties and describing DOT employees'
actions. Jim Borowski served as Christus' primary
representative until Christus retained counsel in late October
2016.
While DOT uses in-house appraisers on some projects, it
5
did not do so here. The third-party appraiser engaged by DOT in
this instance was not a DOT employee.
3
No. 2018AP1114
close in value, it would give [Christus] assurance that nothing
had been missed."6
¶7 Over the next 60 days, DOT contacted both Christus'
representative and its attorney and attempted to negotiate, in
accordance with Wis. Stat. § 32.05(2a). However, by the time of
the second-appraisal deadline, Christus had not engaged in
negotiations, accepted DOT's initial offer, or obtained a second
appraisal at DOT's expense.
¶8 Despite the passing of the 60-day deadline, DOT
continued in its efforts to negotiate with Christus. In mid-
December 2016 DOT emailed Christus' attorney asking if "there
were any sticking points that needed to be worked on" and
requested a response to the initial offer by the end of the
year.
¶9 When Christus did not respond by January 6, 2017, DOT
followed up with Christus' attorney to see if there was a
decision regarding the initial offer. At that time, DOT also
reiterated that it was still interested in negotiating. Three
days later, Christus' attorney informed DOT that the church
council would not agree to a voluntary sale.
¶10 DOT remained concerned about whether the initial
appraisal accurately reflected, or fully addressed, the total
impact of the acquisition. These concerns were exacerbated due
DOT and its agents kept a "negotiation diary" which
6
"summarize[d] the contacts with the landowner" so that DOT could
"ensure that the Department ha[d] complied with all of the steps
necessary to acquiring the property under state law."
4
No. 2018AP1114
to the complete lack of negotiations and Christus' choice not to
obtain a second appraisal. As a result, DOT emailed Christus'
attorney: "This parcel has unique challenges associated with
the acquisition. That is why I had encouraged the Church to
have a second appraisal done. [A second appraisal] would have
provided another opinion of the effects of the acquisition."
Seeking to ensure that Christus would be fairly compensated, DOT
opted to initiate its internal administrative revision process,
which involves obtaining additional estimates and information in
order to review the initial appraisal and offer. DOT advised
Christus' attorney that: (1) it was obtaining estimates to make
sure Christus was fully compensated; (2) it would be contacting
Christus with a final offer; and (3) Christus' attorney should
respond with questions or if there were "any specific matters
[Christus] would like the DOT to research."
¶11 In reviewing the initial offer, DOT recognized that
there "were a number of factors that made this acquisition more
complex than it might first appear." DOT focused on three areas
that the initial appraiser considered, but ultimately did not
compensate, and "items the original appraisal did not fully
address," including: (1) severance damages related to the
building's increased proximity to the right of way;7 (2) the cost
to increase the parking lot to replace the loss of 26 parking
spaces; and (3) the cost of "moving the retention pond."
7 The church was situated 147 feet from the highway prior to
the partial taking. However, after the taking, the church would
be roughly nine feet away from the right of way.
5
No. 2018AP1114
¶12 As to severance damages, which the appraisal defined
as "the loss in value to the portion of the larger parcel
remaining after the taking and construction of the public
improvement," the appraisal explicitly considered whether to
allocate compensation for them, but did not do so. The
appraiser reasoned that:
The church market is very small in Wisconsin due to
the special use nature of the property. We have
researched church sales in the market and could not
delineate any type of proximity damage to improvements
based on available market information. Due to the
lack of relevant sales and few market participants we
were unable to determine any severance damages to
church properties based on proximity damages.
Therefore, we have determined that no severance
damages are caused by the closer proximity to the
State Trunk Highway 15 right of way in the after
condition.
(emphasis added). As to the loss of the 26 parking spaces, the
appraisal concluded that "after the acquisition more than ample
parking remains to service the existing church facility," so
additional compensation was unnecessary. Finally, as to the
pond, the appraiser acknowledged that Christus would lose a
"small surface pond with a surrounding gravel foot path and
native prairie plantings," but did not provide additional
analysis of that loss or whether a new pond would be necessary.
¶13 During the internal administrative revision process,
DOT obtained estimates and received new information regarding
the original construction of the pond and parking lot on the
property. On February 13, 2017, Christus' representative spoke
to DOT about the parking lot and the pond. Christus'
6
No. 2018AP1114
representative advised DOT that the landscaping pond was not a
retention pond and indicated that, because of the changes to the
parking lot, a new retention pond would be necessary. As a
result of these new estimates and its conversations with
Christus' representatives, DOT increased the amount of its
offer. By letter dated March 24, 2017, DOT rescinded its
initial offer and provided a "final offer" in the amount of
$403,200. The letter included the following table with line-by-
line comparisons showing the change in valuation from DOT's
initial offer based on the internal review:
7
No. 2018AP1114
¶14 Most of the allocations in the final offer were either
identical or close to the initial appraisal valuation.8 DOT did
not decrease any of the allocations. The final offer contained
compensation for the three previously mentioned items that DOT
had reviewed through the internal administrative revision
process: (1) severance damages based on the church's proximity
to the new right of way (approximately $160,000); (2) the cost
to replace 26 lost parking spaces (approximately $30,000); and
(3) the cost to add a retention pond on the property
(approximately $45,000). DOT advised Christus that if it did
not sign and return the enclosed agreement by April 5, 2017, DOT
8The revised offer included increased allocations for the
land acquired, site improvements for landscaping, and paved
parking.
8
No. 2018AP1114
would proceed with a jurisdictional offer to purchase, as
provided in Wis. Stat. § 32.05(3). On March 31, 2017, Christus'
representative told DOT to proceed with a jurisdictional offer
to purchase.
¶15 On April 11, 2017, DOT sent Christus a letter stating
that due to failed negotiations, "it is now necessary for WisDOT
to provide you with the enclosed Jurisdictional Offer to
Purchase . . . it is WisDOT's last attempt to reach a settlement
with you." DOT clarified that "[i]f there is no response from
you by 05/01/2017[9], WisDOT will presume that this offer is
rejected." Christus did not respond to the letter, and on May
9, 2017, DOT advised Christus that it was acquiring the property
through the eminent domain process by issuing an award of
damages pursuant to Wis. Stat. § 32.05(7). DOT provided
Christus with a check for $403,200 and a copy of the award of
damages filed with the Outagamie County Register of Deeds.
After DOT sent the award of damages for recording, Christus
hired a new attorney who communicated with DOT and indicated
that the church was interested in starting negotiations. At
that point, however, it was too late since the jurisdictional
offer had expired and the check had already been mailed.
¶16 In response, Christus commenced an action pursuant to
Wis. Stat. § 32.05(5), alleging that DOT violated the statutory
requirement that a jurisdictional offer be "based" "upon" the
9 Christus had 20 days to either accept or reject the
$403,200 jurisdictional offer, pursuant to Wis. Stat.
§ 32.05(6).
9
No. 2018AP1114
appraisal of the property, as required by § 32.05(2)(b) and
(3)(e). The parties filed competing motions for summary
judgment. The circuit court granted summary judgment to DOT,
concluding that the "jurisdictional offer was 'based upon' the
appraisal because the valuation of core line items retained a
similar valuation." The circuit court explained that DOT "was
able to revise its offer as part of the negotiation process
without obtaining a new appraisal because its staff is
experienced in real estate valuation, and it made efforts to
fairly evaluate to [sic] the new line items."
¶17 The court of appeals reversed the circuit court's
decision, reasoning that "the jurisdictional offer in this case
was not sufficiently based on the appraisal" as required by Wis.
Stat. § 32.05(2)(b) and (3)(e) because it included a new line
item for severance damages, which the initial appraisal did not
contain. Christus Lutheran Church of Appleton v. DOT, 2019 WI
App 67, ¶2, 389 Wis. 2d 600, 937 N.W.2d 63. The court of
appeals denied DOT's reconsideration motion. We granted DOT's
petition for review.
II. STANDARD OF REVIEW
¶18 "We review a grant of summary judgment independently,
applying the same methodology as the circuit court." Pinter v.
Vill. of Stetsonville, 2019 WI 74, ¶26, 387 Wis. 2d 475, 929
N.W.2d 547. Summary judgment shall be granted where the record
demonstrates "that there is no genuine issue as to any material
fact and that the moving party is entitled to a judgment as a
matter of law." Wis. Stat. § 802.08(2).
10
No. 2018AP1114
¶19 This case requires us to interpret several provisions
of Wis. Stat. ch. 32, which presents a question of law that we
review de novo. Noffke ex rel. Swenson v. Bakke, 2009 WI 10,
¶9, 315 Wis. 2d 350, 760 N.W.2d 156. The purpose of statutory
interpretation is to "determine what the statute means so that
it may be given its full, proper, and intended effect." State
ex rel. Kalal v. Circuit Court for Dane Cnty., 2004 WI 58, ¶44,
271 Wis. 2d 633, 681 N.W.2d 110.
III. ANALYSIS
¶20 We begin our analysis by outlining Wisconsin's
statutory condemnation procedures. Then we discuss Otterstatter
v. City of Watertown, 2017 WI App 76, 378 Wis. 2d 697, 904
N.W.2d 396, which the parties agree establishes the framework
for evaluating whether a jurisdictional offer is "based" "upon"
an appraisal, pursuant to Wis. Stat. § 32.05(2)(b) and (3)(e).10
Finally, in light of Otterstatter, we address the parties'
arguments regarding the validity of the jurisdictional offer and
the new requirement enunciated in the court of appeals'
decision.
A. Statutory Condemnation Procedures
¶21 This appeal concerns the condemnation of property for
transportation use, which is governed by the procedures set
Wisconsin Stat. § 32.05(3)(e) uses the language "based"
10
"on" rather than the "based" "upon" language found in
§ 32.05(2)(b). However, neither party has argued that this
distinction is of import to our decision here.
11
No. 2018AP1114
forth in Wis. Stat. § 32.05.11 Pursuant to § 32.05, a condemnor
is required to:
"cause at least one, or more in the condemnor's
discretion," appraisal to be made of "all property
proposed to be acquired," § 32.05(2)(a);
"provide the owner with a full narrative appraisal
upon which the jurisdictional offer is based and a
copy of any other appraisal made under par. (a),"
§ 32.05(2)(b);12
11 Wisconsin Statutes divide condemnation procedures into:
(1) "quick-take" procedure for transportation and sewer
projects, Wis. Stat. § 32.05; and (2) "slow-take" procedure used
for other takings, Wis. Stat. § 32.06. See Waller v. Am.
Transmission Co., LLC, 2013 WI 77, ¶¶56-57, 350 Wis. 2d 242, 833
N.W.2d 764. This case involves the quick-take procedure.
12 Creating an argument on behalf of Christus, the dissent
asserts that Wis. Stat. § 32.05(2)(a) and (2)(b) describe
different appraisals. But see Serv. Emp. Int'l Union, Local 1
v. Vos, 2020 WI 67, ¶24, 393 Wis. 2d 38, 946 N.W.2d 35 ("We do
not step out of our neutral role to develop or construct
arguments for parties; it is up to them to make their case.").
According to the dissent, § 32.05(2)(b) requires "a more
particularized appraisal than an initial appraisal made under
§ 32.05(2)(a)" because the § 32.05(2)(b) appraisal is
distinguished from "any other appraisal made under par. (a)" and
because § 32.05(2)(b) uses the term "full narrative appraisal."
Dissent, ¶62. The dissent's analysis defies logic. The
legislature was simply acknowledging in § 32.05(2)(b) that there
could be more than one appraisal since § 32.05(2)(a) says "one,
or more."
12
No. 2018AP1114
inform the owner of his or her right to obtain an
appraisal at the condemnor's expense, § 32.05(2)(b);
and
attempt to negotiate personally with the owner,
§ 32.05(2)(a).13
The dissent also fails to recognize that "narrative
appraisal" is a term of art in the real estate context. Rather
than rely upon real estate-related sources for a definition or
explanation, the dissent looks to an ordinary dictionary
definition of "narrative," and concludes that § 32.05(2)(b)
requires an appraisal "that gives all of the particulars of the
taking for which the appraisal was made." Dissent, ¶56.
However, the Appraisal Institute's Appraisal of Real Estate at
609, 612 (15th ed. 2020) instructs that "[i]n a narrative
appraisal report, the most detailed and customizable format for
reporting appraisal conclusions, an appraiser provides support
and rationale for his or her opinions and conclusions . . . "
and that "[n]arrative appraisal reports will vary in content and
organization, depending on the needs of the client and other
intended users . . . ." Similarly, the Dictionary of Real
Estate Appraisal defines "narrative report" as "[a] written
communication of the results of a valuation or review assignment
presented to the client in narrative style rather than on a form
or orally." Narrative Report, The Dictionary of Real Estate
Appraisal (6th ed. 2015). With this context in mind, it is
clear that when the term "narrative" qualifies the appraisal in
§ 32.05(2)(b) it is describing form and style, rather than
substance, and that § 32.05(2)(b) does not describe a different
appraisal than that described in § 32.05(2)(a).
13 This attempt at negotiation on the part of the condemnor
is a jurisdictional requirement to proceed with the
condemnation. Arrowhead Farms, Inc. v. Dodge Cnty.,
21 Wis. 2d 647, 652, 124 N.W.2d 631 (1963). We have recognized
that public policy "encourages the settlement of controversies
without resort to litigation," and that the legislature has made
"attempt at negotiation compulsory in the field of eminent
domain." Connor v. Mich. Wis. Pipe Line Co., 15 Wis. 2d 614,
624, 113 N.W.2d 121 (1962).
13
No. 2018AP1114
¶22 If negotiations fail to produce a voluntary sale, the
condemnor may acquire the property by:
sending the property owner a jurisdictional offer to
purchase the property, Wis. Stat. § 32.05(3);14
giving the property owner 20 days to accept or reject
the jurisdictional offer, § 32.05(6); and
(assuming the jurisdictional offer is not accepted)
making an award of compensation "which shall be an
amount at least equal to the amount of the
jurisdictional offer," § 32.05(7)(a), the "just
compensation" requirement.15
¶23 Wisconsin Stat. § 32.05 provides two methods for
landowners to challenge a condemnation once damages have been
awarded: (1) a right-to-take action, § 32.05(5), and (2) a just
compensation proceeding, § 32.05(9)-(12). A right-to-take
action, which Christus filed, is used "to contest the right of
the condemnor to condemn the property described in the
jurisdictional offer, for any reason other than that the amount
of compensation offered is inadequate" and is the "only manner
in which any issue other than the amount of just
That offer must outline several items enumerated in Wis.
14
Stat. § 32.05(3)(a)-(i), including a statement "that the
appraisal or one of the appraisals of the property on which
condemnor's offer is based is available for inspection at a
specified place by persons having an interest in the lands
sought to be acquired." § 32.05(3)(e).
The just compensation requirement is mandated by the
15
Fifth Amendment to the United States Constitution and Article I,
Section 13 of the Wisconsin Constitution.
14
No. 2018AP1114
compensation . . . may be raised pertaining to the condemnation
of the property described in the jurisdictional offer."
§ 32.05(5). The second method, a just compensation proceeding,
is "when a property owner challenges the amount of compensation
in a just compensation trial after an award of damages has been
recorded" and is "directed to defects in the procedure for
determining just compensation . . . ." Otterstatter, 378 Wis.
2d 697, ¶¶35-36 (alteration in original).
¶24 Here, Christus' challenge is related to the right of
DOT to condemn its property. Christus asserts that the
jurisdictional offer is void because it was not "based" "upon"
an appraisal, as required by Wis. Stat. § 32.05(2)(b) and
(3)(e); and that the appraisal did not value "all property
proposed to be acquired," pursuant to § 32.05(2)(a).
B. Otterstatter
¶25 The circuit court, court of appeals, and the parties
all agree that Otterstatter establishes the framework for
evaluating whether the jurisdictional offer was sufficiently
based upon DOT's initial appraisal, so we provide a brief
overview of that decision.
¶26 When the City of Watertown sought to acquire
Otterstatter's property by eminent domain as part of an airport
expansion project, it initially appraised the value of his land
at $240,000. Otterstatter, 378 Wis. 2d 697, ¶5. The City sent
Otterstatter the appraisal and an initial offer for $240,000,
which he rejected as "too low." Id. Additionally, the City
informed Otterstatter that he had the right to obtain his own
15
No. 2018AP1114
appraisal at the City's expense. Id. Otterstatter declined to
do so, and remained unsatisfied with the City's offer,
ultimately sending an email that described the offer as "an
embarrassment." Id., ¶6. In light of Otterstatter's comments
and a subsequent review of the initial offer, the City increased
its offer by $30,000. Id., ¶7. The City also continued to try
to negotiate with Otterstatter; when he refused, the City sent
him a formal jurisdictional offer for $270,000. Id., ¶¶7-8. In
response to the jurisdictional offer, Otterstatter filed a
right-to-take action under Wis. Stat. § 32.05(5) alleging, among
other complaints, that the jurisdictional offer was not "based"
"upon" the appraisal, as required by § 32.05(2)(b), because it
did not equal the appraisal amount. Id., ¶10.
¶27 The Otterstatter court noted that "Wisconsin Stat. ch.
32 does not contain a definition of the phrase 'based' 'upon.'"
Id., ¶24. The court, relying on dictionary definitions,
concluded that the meaning of "based" "upon" is that "the
appraisal must be a supporting part or fundamental ingredient of
the jurisdictional offer." Id. The court of appeals concluded
that Otterstatter did not show that "the $30,000 increase
deviated so substantially from the $240,000 appraisal that the
appraisal can no longer be said to be a supporting part or
fundamental ingredient of the $270,000 jurisdictional offer."
Id., ¶25.
¶28 The Otterstatter court rejected the argument that a
jurisdictional offer must equal the appraisal on which the offer
is based and "decline[d] to insert such a matching requirement
16
No. 2018AP1114
into the statute." Id., ¶27. The court of appeals also noted
that chapter 32 "explicitly establishes a process of required
opportunity for negotiation" and that the City "was not required
to stick with its initial offer based on its appraisal, but
rather was required to negotiate to see if that number was too
low." Id., ¶28. In short, the court rejected Otterstatter's
challenges to the validity of the jurisdictional offer. Id.,
¶4. With the Otterstatter framework in mind, we turn to
Christus' arguments and the validity of DOT's jurisdictional
offer.
C. The Jurisdictional Offer Was Valid Under Wis. Stat.
§ 32.05(2)(a)-(b), and (3)(e)
¶29 Christus first asserts that DOT's jurisdictional offer
was not "based" "upon" an appraisal, as required by Wis. Stat.
§ 32.05(2)(b) and (3)(e), because the jurisdictional offer
contained several new line items, including severance damages,
not found in the appraisal. Further, Christus claims that the
appraisal failed to satisfy § 32.05(2)(a)'s "all property"
requirement. Christus' arguments fail.
1. Wisconsin Stat. § 32.05 (2)(b) and (3)(e)
¶30 To begin, we adopt and reiterate the Otterstatter
court's conclusion that a mere difference in dollar amounts
between the initial appraisal and jurisdictional offer does not
mean the jurisdictional offer was not "based" "upon" the
appraisal, as required by Wis. Stat. § 32.05(2)(b) and (3)(e).
Otterstatter, 378 Wis. 2d 697, ¶27. That is, "based" "upon"
does not mean "equal to." This conclusion by the Otterstatter
17
No. 2018AP1114
court is further buttressed when we analyze § 32.05(2)(b) and
(3)(e) in context. See Kalal, 271 Wis. 2d 633, ¶46
("[S]tatutory language is interpreted 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 . . . ."). While the legislature did not use the term
"equal to" in § 32.05(2)(b) or (3)(e), it did use the term
"equal to" in a different subsection of § 32.05: "The award
shall also state the compensation for the taking which shall be
an amount at least equal to the amount of the jurisdictional
offer." § 32.05(7)(a) (emphasis added). Had the Legislature
wanted to use the term "equal to" in § 32.05(2)(b) or (3)(e), it
would have done so. See Pawlowski v. Am. Fam. Mut. Ins. Co.,
2009 WI 105, ¶22, 322 Wis. 2d 21, 777 N.W.2d 67 ("When the
legislature chooses to use two different words, we generally
consider each separately and presume that different words have
different meanings."). To summarize, just because there is a
monetary difference between the initial appraisal and the
jurisdictional offer does not mean the jurisdictional offer is
not "based" "upon" the appraisal under § 32.05(2)(b) and (3)(e).
¶31 Otterstatter's definition of "based" "upon" as "a
supporting part or fundamental ingredient" is further bolstered
by Black Law Dictionary's definition of the verb "base" as "[t]o
make, form, or serve as a foundation for."16 Base, Black's Law
16See also "Base," Merriam Webster Online Dictionary
(2021), https://www.merriam-webster.com/dictionary/base
(defining the verb "base" as "to find a foundation or basis for"
and "to make, form, or serve as a base for").
18
No. 2018AP1114
Dictionary 185 (11th ed. 2019). Applying these definitions, it
is evident that DOT's jurisdictional offer was based upon the
initial appraisal and satisfies Wis. Stat. § 32.05(2)(b) and
(3)(e). The initial appraisal discussed and considered
severance damages,17 the loss of 26 parking spaces,18 and the loss
of the current pond on the property,19 despite not allocating
compensation for these items. A side-by-side comparison shows
that no allocation decreased between the initial appraisal and
jurisdictional offer. As the circuit court properly noted, most
of the allocations "are relatively close in value," if not
"actually identical in both offers." The significant changes
between the initial appraisal and the jurisdictional offer, as a
result of DOT's internal administrative revision process,
The
17 third-party appraiser specifically considered
severance damages, but was unable to make the determination
based on the data it had:
Due to the lack of relevant sales and few market
participants we were unable to determine any severance
damages to church properties based on proximity
damages. Therefore, we have determined that no
severance damages are caused by the closer proximity
to the State Trunk Highway 15 right of way in the
after condition.
While the appraisal acknowledged the loss of the 26
18
parking spaces, it concluded that "after the acquisition more
than ample parking remains to service the existing church
facility."
As to the pond, the appraiser acknowledged that Christus
19
would lose a "small surface pond with a surrounding gravel foot
path and native prairie plantings," but the realization that
Christus would need a retention pond on the property arose
during later conversations with Christus' representative.
19
No. 2018AP1114
included increased allocations for: (1) severance damages
because of the proximity of the new right of way;
(2) compensation for the cost to replace the 26 lost parking
spaces; and (3) compensation to add a retention pond. Adding
these new amounts to the initial appraisal valuation does not
make the initial appraisal something other than a foundation for
the jurisdictional offer. To the contrary, the fact that most
of the allocations remained unchanged from the beginning to the
end of the process demonstrates that the appraisal served as the
foundation for the offer.
¶32 While Christus and the court of appeals chided DOT for
relying upon its internal administrative review process to re-
examine its initial offer, DOT employed the process in order to
ensure that it fully and fairly compensated Christus. Like in
Otterstatter, DOT initially offered Christus the same amount as
the initial appraisal, $133,400. When Christus decided against
obtaining its own appraisal at DOT's expense, despite DOT
repeatedly urging it to do so and referring to the project as a
"complex acquisition," DOT reassessed the initial appraisal to
ensure Christus would receive full compensation. See
Otterstatter, 378 Wis. 2d 697, ¶28 (reasoning that the City
"was not required to stick with its initial offer based on its
appraisal, but rather was required to negotiate to see if that
number was too low").
¶33 Consistent with its statutory responsibility to
provide just compensation to landowners, and despite Christus'
failure to take an active role in the process, DOT reconsidered
20
No. 2018AP1114
three losses that were identified, but not compensated or fully
addressed, in the initial appraisal. DOT would have been remiss
had it not diligently reviewed the initial appraisal given the
acquisition's complexity and then revised its offer to reflect
the full value of the property it sought to condemn. See id.
(noting the lack of statutory language "that would prevent a
condemnor . . . from offering more than the appraised amount as
part of the [negotiation] effort it is required to make"). To
summarize, DOT's actions in re-examining and reassessing several
items that were considered but not fully addressed in the
initial appraisal do not mean the jurisdictional offer is not
"based" "upon" the appraisal under Wis. Stat. § 32.05(2)(b) and
(3)(e).
2. Wisconsin Stat. § 32.05(2)(a)
¶34 Next, Christus adopts the court of appeals' analysis
and asserts that the appraisal failed to satisfy Wis. Stat.
§ 32.05(2)(a)'s "all property" requirement. Sidestepping the
question of whether the jurisdictional offer was "based" "upon"
the initial appraisal pursuant to Otterstatter and § 32.05(2)(b)
and (3)(e), the court of appeals concluded that the
jurisdictional offer "fails for a more basic reason——namely, the
DOT failed to obtain an appraisal that valued 'all property
proposed to be acquired,' contrary to Wis. Stat. § 32.05(2)(a)."
Christus, 389 Wis. 2d 600, ¶24. According to the court of
appeals, because the jurisdictional offer included compensation
for severance damages not found in the initial appraisal, the
21
No. 2018AP1114
appraisal failed to satisfy § 32.05(2)(a).20 In reaching this
conclusion, the court of appeals conflated "property" and
"damages." The focus of § 32.05(2)(a) is the appraisal of
property. The statute dictates that a condemnor "shall cause at
least one, or more in the condemnor's discretion, appraisal to
be made of all property proposed to be acquired." § 32.05(2)(a)
(emphasis added). Chapter 32 defines "property" as "includ[ing]
estates in lands, fixtures and personal property directly
connected with lands." § 32.01(2). Damages are not included in
chapter 32's definition of "property" and we do not "read into
the statute words the legislature did not see fit to write."
Dawson v. Town of Jackson, 2011 WI 77, ¶42, 366 Wis. 2d 318, 801
N.W.2d 316. Ultimately Christus failed to identify any portion
of its property, as defined in chapter 32, that the initial
appraisal excluded, and therefore the offer satisfies
§ 32.05(2)(a).21
20The court of appeals declined to address the additional
compensation provided in the jurisdictional offer for the
retention pond and the replacement of lost parking spaces,
reasoning that "the parties have not focused individually on the
addition of these line items of damages, nor has Christus
Lutheran directly argued their inclusion constitutes a violation
of the Wis. Stat. § 32.05(2)(a) 'all property' requirement."
Christus, 389 Wis. 2d 600, ¶25 n.11.
21Additionally, the argument that the "statutorily
enumerated items" of damage or loss listed in the just
compensation statute, Wis. Stat. § 32.09, are "property" and
must appear in the appraisal is misplaced. There is no
reference to § 32.09 or "damages" in § 32.05(2)(a)'s "all
property" requirement. Instead, § 32.09(6) dictates that those
items must be "giv[en] effect" in the just compensation
determination, which is not at issue since Christus filed a
right-to-take action.
22
No. 2018AP1114
3. The Court of Appeals' New Requirement
¶35 Finally, we must explicitly reject the new requirement
that the court of appeals enunciated in its opinion: "if the
DOT, based solely upon its independent review of an appraisal,
believes additional statutory items of just compensation warrant
inclusion in the jurisdictional offer, it must obtain a new
appraisal that substantiates that belief and provides an opinion
as to the value of those interests." Christus, 389 Wis. 2d 600,
¶32. Not only does this requirement find no support in the
statutory text,22 it also raises a multitude of ethical concerns.
The only way for condemnors like DOT to "obtain a new appraisal
that substantiates [a particular] belief" would be for DOT
either to improperly direct or to coerce its in-house appraisers
or third-party appraisers into acting in accordance with DOT's
instructions rather than making independent assessments. Yet,
Wisconsin appraisers must comply with the Uniform Standards of
Professional Appraisal Practice ("USPAP"), pursuant to Wis.
Admin. Code §§ SPS 85.110-115, 86.01(1) (May 2019). USPAP
ethics rules outline an appraiser's ethical obligation to be
independent, impartial, and objective and forbids appraisers
from "agree[ing] to perform an assignment that includes the
reporting of predetermined opinions and conclusions." See The
In fact, it creates a mandatory requirement for multiple
22
appraisals despite the statutory language being discretionary.
See Wis. Stat. § 32.05(2)(a) ("The condemnor shall cause at
least one, or more in the condemnor's discretion, appraisal to
be made of all property proposed to be acquired" (emphasis
added).)
23
No. 2018AP1114
Appraisal Foundation, Uniform Standards of Professional
Appraisal Practice 7 (2020-21 ed.). Therefore, any appraiser
who provides an estimate or opinion based on DOT's directive
would be in violation of her ethical code.
IV. CONCLUSION
¶36 We uphold the circuit court's grant of summary
judgment to DOT and conclude that the jurisdictional offer was
valid because it was "based" "upon" an initial appraisal of "all
property proposed to be acquired," pursuant to Wis. Stat.
§ 32.05(2)(a)-(b), and (3)(e).
By the Court.—The decision of the court of appeals is
reversed.
24
No. 2018AP1114.pdr
¶37 PATIENCE DRAKE ROGGENSACK, C.J. (dissenting).
Condemnation is an extraordinary power. Properly exercised,
condemnation permits the State to take private property for
public use in a constitutionally permissible manner.
¶38 In order to comply with the Wisconsin Constitution's
criteria necessary to taking private property for public use,
Wisconsin has enacted detailed statutory procedures that protect
owners' interests in their property. When the Department of
Transportation (DOT) is the state agency wielding condemnation
powers, it must strictly comply with procedures set out in Wis.
Stat. § 32.05. Standard Theatres, Inc. v. DOT, 118 Wis. 2d 730,
742, 349 N.W.2d 661 (1984) (explaining that the rule of strict
construction is to be applied to a condemnor's power).
¶39 Because DOT failed to comply with Wis. Stat.
§§ 32.05(2) and (3), it ignored fundamental statutory
obligations necessary to its jurisdiction to condemn Christus
Lutheran Church of Appleton's property and therefore, DOT lacked
jurisdiction. Jurisdictional errors cannot be overlooked.
Accordingly, I would affirm the court of appeals. Because the
majority opinion misses the interconnection among § 32.05(3),
Wis. Stat. § 32.09 and § 32.05(2)(b) it erroneously interprets
§§ 32.05(2) and (3), misreads Otterstatter v. City of Watertown,
2017 WI App 76, 378 Wis. 2d 697, 904 N.W.2d 396 and creates
facts to excuse DOT's failures to comply with its statutory
obligations, I respectfully dissent.
1
No. 2018AP1114.pdr
I. BACKGROUND
¶40 In 2016, DOT decided to upgrade State Highway 15. A
part of the planned improvements abut Christus Lutheran's
property. To facilitate Highway 15 improvements, DOT sought
5.87 acres in fee and .198 acres as a temporary easement from
church property.
¶41 DOT had an appraisal of the property it sought to
condemn prepared by Single Source, Inc. Single Source appraised
the value of DOT's entire taking at $133,400. This appraisal,
dated September 30, 2016, was presented to Christus Lutheran on
October 3, 2016, together with DOT's $133,400 offer to purchase
all property necessary to facilitate the Highway 15
improvements. Christus Lutheran's congregation refused to sell.
¶42 The DOT also conducted an internal assessment of the
$133,400 appraisal it had tendered to Christus Lutheran and
arrived at a new ad hoc valuation for the property it sought.1
DOT's ad hoc valuation contained items that were not listed and
increased valuations for items that were listed in the Single
Source appraisal.
¶43 In March 2017, DOT offered to purchase Christus
Lutheran's property for $403,200. This was a $269,800 increase
in DOT's original $133,400 offer to purchase, which offer DOT
supported with Single Source's appraisal. DOT asserts that it
increased the valuation of the taking without obtaining another
appraisal, but rather, based on its own internal review.
The record does not reflect whether DOT evaluated the
1
Single Source appraisal before or after it offered to purchase
the church's property for $133,400.
2
No. 2018AP1114.pdr
¶44 Part of DOT's increased valuation was the addition of
$159,574 in severance damages, for which Single Source's
appraisal had allocated nothing.2 The record shows that prior to
condemnation, the side of the church building was located
"approximately 147.7 feet" from the Highway 15 right-of-way.3
After DOT's acquisition, the side of the church would be located
only 9 feet from the highway right-of-way.4 In addition, a
minimum of 12 foot side yard setback was required by local
zoning.5 Furthermore, Wis. Adm. Code § Trans 233.08, which
contains DOT's administrative rules about setbacks from highway
right-of-ways, should have been addressed by a knowledgeable
appraiser.
¶45 DOT also increased Single Source's valuation by
$30,321 for 26 parking spaces that DOT's condemnation would
take. Again, the Single Source appraisal allocated nothing for
taking 26 parking spaces. Single Source did so after concluding
that the church "had more than ample parking" remaining for its
275-seat church.6
2 In support of awarding no amount for severance damages,
the appraisal explained, "Due to the lack of relevant sales and
few market participants we were unable to determine any
severance damages to church properties based on proximity
damages. Therefore, we have determined that no severance
damages are caused by the closer proximity to the State Trunk
Highway 15 right of way in the after condition." Single Source
appraisal, 12.
3 Id.
4 Id.
5 Id.
6 Id., 11, 12.
3
No. 2018AP1114.pdr
¶46 DOT further increased Single Source's valuation by
$45,000 for a retention pond that had not been included in the
Single Source appraisal. DOT's addition of $159,574 for
severance damages, $30,321 for condemned parking spaces and
$45,000 for a necessary retention pond totaled $234,895, all for
items that were given no value in Single Source's appraisal.
¶47 DOT further increased values for items listed in the
Single Source appraisal that were drastically undervalued, e.g.,
an $18,075 increase for landscaping, including a decorative pond
that was taken, and $14,675 for land acreage. All in all, DOT's
internal review increased the value of the property it sought by
$269,800 to a total of $403,200, for which DOT made a second
offer to purchase. This was a 202% increase over DOT's $133,400
initial offer to purchase, which was based on the Single Source
appraisal. Once again, Christus Lutheran's congregation refused
to sell.
¶48 On April 11, 2017, DOT made a $403,200 jurisdictional
offer based on its internal valuation.7 However, the
jurisdictional offer stated that the "purchase price is based
upon an appraisal of the owner's property of which a copy of the
appraisal report has been provided to the owner."8 The Single
Source appraisal for $133,400 was the only appraisal provided to
Christus Lutheran.9
7 R. at 17-2.
8 Id.
9 DOT asserts that it increased Single Source's appraisal
valuation without the benefit of another appraisal, but based
solely on its internal review.
4
No. 2018AP1114.pdr
¶49 On May 15, 2017, Christus Lutheran sued the DOT
pursuant to Wis. Stat. § 32.05(5), claiming that DOT did not
have the right to condemn its property. Both parties moved for
summary judgment, and the circuit court granted summary judgment
to DOT. Christus Lutheran appealed, and the court of appeals
reversed, concluding that the jurisdictional offer was not based
on the appraisal DOT provided as § 32.05(2)(a) and (b) and Wis.
Stat. § 32.09(6)(e) require. Christus Lutheran Church of
Appleton v. DOT, 2019 WI App. 67, ¶2, 389 Wis. 2d 600, 937
N.W.2d 63. DOT petitioned for review, which we granted.
II. DISCUSSION
A. Standard of Review
¶50 The summary judgments issued in this case turn on the
interpretation and application of Wis. Stat. §§ 32.05(2) and (3)
and Wis. Stat. § 32.09(6)(e). Statutory interpretations and
their applications to undisputed material facts present
questions of law that we review independently, while benefitting
from previous court discussions. Voces De La Frontera, Inc. v.
Clarke, 2017 WI 16, ¶12, 373 Wis. 2d 348, 891 N.W.2d 803.
B. Statutory Interpretation General Principles
¶51 Statutory interpretation begins with the language of
the statute. If the meanings of the terms chosen by the
legislature are plain, generally we stop our inquiry. Id., ¶14.
"Statutory language is given its common, ordinary, and accepted
meaning, except that technical or specially-defined words or
phrases are given their technical or special definitional
meaning." State ex rel Kalal v. Circuit Court for Dane Cnty.,
5
No. 2018AP1114.pdr
2004 WI 58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110. We interpret
statutory terms in the context in which they are used, not in
isolation. Id., ¶46. Therefore, surrounding or closely related
statutes are important in our plain meaning review. Id.
¶52 However, if a statute is capable of being understood
by reasonably well-informed persons in two or more ways, then
the statute is ambiguous. Id., ¶47.
C. DOT Statutory Framework
¶53 Wisconsin Stat. § 32.05 provides the statutory
framework that is to be followed when DOT wields the power of
condemnation. DOT must fit its actions within that statutory
framework if it is to have jurisdiction to condemn. Warehouse
II, LLC v. DOT, 2006 WI 62, ¶1, 291 Wis. 2d 80, 715 N.W.2d 213
(requiring DOT to negotiate with the property owner before
issuing a jurisdictional offer because prior negotiation is "a
fundamental, statutory requirement"). The statutes provide that
notice of a jurisdictional offer, the parameters of which are
set out in § 32.05(3), is "a jurisdictional requisite to a
taking by condemnation." § 32.05(4).
¶54 The question then becomes, how does DOT construct a
statutorily sufficient jurisdictional offer. The DOT begins by
obtaining one or more appraisals of all property to be acquired
for its highway improvement. For example, an appraisal may be
made pursuant to Wis. Stat. § 32.05(2)(a), which states, "The
condemnor shall cause at least one, or more in the condemnor's
discretion, appraisal to be made of all property proposed to be
acquired." The description of appraisals made pursuant to
6
No. 2018AP1114.pdr
§ 32.05(2)(a) is brief. Those appraisals require only that "all
property proposed to be acquired" be valued in the appraisal.
Paragraph (2)(a) does not say how that property should be
described.
¶55 By contrast, Wis. Stat. § 32.05(2)(b) specifically
describes the type of appraisal that is necessary to support a
jurisdictional offer: "The condemnor shall provide the owner
with a full narrative appraisal upon which the jurisdictional
offer is based." § 32.05(2)(b). The legislature has used
different words to describe appraisals in § 32.05(2)(a) and
(2)(b); therefore, rules of statutory construction require us to
presume we are independently to interpret the difference in
words as defining different types of appraisals. See Pawlowski
v. American Family Mut. Ins. Co., 2009 WI 105, ¶22, 322 Wis. 2d
21, 777 N.W.2d 67 (explaining that basic rules of statutory
construction require us to give independent meaning to each word
so that none is superfluous).
¶56 "Narrative" is not a defined term in Wis. Stat. ch.
32. However, as we have done so often in the past, I employ a
common and approved definition found in a dictionary. State v.
DeLain, 2005 WI 52, ¶17, 280 Wis. 2d 51, 695 N.W.2d 484. A
common meaning of narrative is "the process of telling the
particulars." Webster's Third New Int'l Dictionary 1503 (1961).
"Narrative" is modified by the word, "full" in Wis. Stat.
§ 32.05(2)(b). Accordingly, I conclude that a "full narrative
7
No. 2018AP1114.pdr
appraisal" is one that gives all of the particulars of the
taking for which the appraisal was made.10
¶57 In addition, Wis. Stat. § 32.05(2)(b) distinguishes
the type of appraisal sufficient to support a jurisdictional
offer from a § 32.05(2)(a) appraisal because both appraisals are
addressed at the time a jurisdictional offer is made. Paragraph
(2)(b) provides that in addition to a full narrative appraisal,
the DOT also must provide "a copy of any other appraisal made
under par. (a)." § 32.05(2)(b). Clearly, the legislature was
talking about two different appraisals, if the first appraisal
was made under paragraph (2)(a) rather than under paragraph
(2)(b).
¶58 It is important to note that there is a statutory
connection among what a jurisdictional offer must contain, which
is set out in Wis. Stat. § 32.05(3), the "damages" listed in
Wis. Stat. § 32.09 and an appraisal pursuant to § 32.05(2)(b)
upon which a jurisdictional offer is based.
¶59 Wisconsin Stat. § 32.05(3) sets out all the items of
which the jurisdictional offer must give notice. Section
32.05(3)(d) requires that a jurisdictional offer "[s]tat[e] the
amount of compensation offered, itemized as to the items of
damage set forth in s. 32.09." In so doing, § 32.05(3) reaches
The majority opinion chaffs at my use of a dictionary
10
definition for "narrative." Majority op., ¶21 n.12. It refers
to a definition from the Appraisal Institute that defines a
narrative appraisal as "the most detailed and customizable
format for reporting appraisal conclusions." Id. That
definition sounds ok to me too. Under either definition, a
full, detailed description of what is being appraised is
required.
8
No. 2018AP1114.pdr
back into Wis. Stat. § 32.09, which is applied during a just
compensation proceeding, to require that the jurisdictional
offer include items of "damage" listed in § 32.09 when they are
relevant to the particular taking at issue.
¶60 One of the provisions of Wis. Stat. § 32.09 that is
relevant to these proceedings is found in subsection (6), which
addresses partial takings.11 Subsection (6) recognizes that in a
partial taking, the property condemned may need to be valued by
more than one item of damage to fully compensate the owner. For
example, § 32.09(6)(e) requires that "Damages resulting from
actual severance of land including damages resulting
from . . . proximity damage to improvements remaining on
condemnee's land" must be valued. Therefore, the acreage value
may not be the total value of the land that has been taken.
Compensation may be required in the jurisdictional offer because
the land taken also may have provided a buffer for the remaining
property and the taking removes that buffer. Paragraph
32.09(6)(e) values such a buffer as severance damages, which is
a component of the value of the property taken. Because a
jurisdictional offer is required to include severance damages
when they occur and because the jurisdictional offer must be
based on a full narrative appraisal, severance damages must be a
component of that full narrative appraisal when they occur.
D. The Taking of Christus Lutheran's Property
11 DOT's condemnation of church property is a partial
taking.
9
No. 2018AP1114.pdr
¶61 Christus Lutheran contends that DOT did not make a
jurisdictional offer sufficient to satisfy necessary statutory
requirements and therefore, it lacks the right to condemn its
property. I agree, for a number of reasons.
¶62 First, DOT did not provide Christus Lutheran with an
appraisal sufficient to comply with the directive of Wis. Stat.
§ 32.05(2)(b).12 A plain reading of § 32.05(2)(b) makes apparent
that a "full narrative appraisal upon which the jurisdictional
offer is based" is a more particularized appraisal than an
initial appraisal made under § 32.05(2)(a).13 This is so because
of the way in which a (2)(b) appraisal is described, "a full
narrative appraisal upon which the jurisdictional offer is
based," and because a § 32.05(2)(b) appraisal is distinguished
from "any other appraisal made under par. (a)."
¶63 That there is a difference in appraisal types is also
supported by the statutory requirement that both Wis. Stat.
32.05(2)(b) and (2)(a) appraisals are required to be provided to
the property owner when the jurisdictional offer is made if both
have been completed. § 32.05(2)(b).
¶64 Second, the Single Source appraisal is not a full
narrative appraisal upon which the jurisdictional offer was
12Wisconsin Stat. § 32.05(2)(b) provides: "The condemnor
shall provide the owner with a full narrative appraisal upon
which the jurisdictional offer is based and a copy of any other
appraisal made under par. (a) and at the same time shall inform
the owner of his or her right to obtain an appraisal under this
paragraph."
13Wisconsin Stat. § 32.05(2)(a) provides: "The condemnor
shall cause at least one, or more in the condemnor's discretion,
appraisal to be made of all property proposed to be acquired."
10
No. 2018AP1114.pdr
based because it failed to value at least one item of property
that is included in the $403,200 jurisdictional offer and of
which the jurisdictional offer was required to give notice
pursuant to Wis. Stat. § 32.05(3)(d).
¶65 To explain further, Wis. Stat. § 32.05(3)(d) provides
that the jurisdictional offer must state "the amount of
compensation offered, itemized as to the items of damage as set
forth in s. 32.09." And, Wis. Stat. § 32.09(6)(e) requires the
inclusion of severance damages in a partial taking when there
are "damages resulting from severance of improvements or
fixtures and proximity damage to improvements remaining on
condemnee's land." Because a jurisdictional offer is required
to include severance damages which occurred here and because the
jurisdictional offer must be based on a full narrative
appraisal, severance damages must be a component of that full
narrative appraisal.
¶66 The majority opinion concludes that totally missing
severance damages is no problem because DOT is required to pay
just compensation for "property," which is different from
"damages."14 The majority opinion asserts that the court of
appeals conflated 'property' and 'damages.'"15 It then relates
that the definition of "property" found in Wis. Stat. § 32.01(2)
does not include the word, "damages," even though "property" as
defined in § 32.01(2) includes "estates in lands."16
14 Majority op., ¶34.
15 Id.
16 Id.
11
No. 2018AP1114.pdr
¶67 This reasoning misses that in order to
constitutionally take property of another the DOT must
compensate for all items of value that the property taken had
provided to the owners and that those items are described as
"damages" in condemnation parlance. Wis. Town House Builders,
Inc. v. City of Madison, 37 Wis. 2d 44, 54, 154 N.W.2d 232
(1967) (explaining that Wis. Stat. § 32.05(3)(d) "requires an
itemization of damages, [which] is not directional but
mandatory"). The legislature understands this itemization
requirement and has enacted statutes that recognize all items of
value for property taken. For example, acreage valuation is one
item of value of the land taken; severance damage is another
item of value for the same land. Severance damages recognize
the buffer from the highway right-of-way that the land taken had
provided to the property remaining with the owner.
¶68 To explain further, before condemnation, Christus
Lutheran's church building had a 147.7 foot side yard buffer
from the Highway 15 right-of-way.17 After condemnation, the
church building would be only 9 feet from Highway 15's right-of-
way.18 Certainly, having trucks rumble-by only 9 feet from where
church services are being conducted removed a significant sound
buffer and safety barrier that the land DOT is taking had
provided to religious service participants.
¶69 This item of the property's value is called "damages"
in part because Wis. Stat. § 32.05(3)(d) requires that in a
17 Single Source appraisal, 12.
18 Id.
12
No. 2018AP1114.pdr
jurisdictional offer "the amount of compensation offered, [is]
itemized as to the items of damages as set forth in s. 32.09."
Wisconsin Stat. § 32.09(6)(e) addresses an item of value in the
land taken during a partial taking because of subsequent
proximity of improvements that are on the property remaining
with the owner, e.g., the proximity of Christus Lutheran's
church building to the Highway 15 right-of-way. Therefore, the
term "damages" is a statutory term for items of value that are
within the property DOT takes. Id.
¶70 The majority opinion also creates facts to excuse the
Single Source appraisal's failure to include any value for
severance damages, parking replacement or a retention pond and
its gross undervaluation for landscaping and acreage taken. It
does so in part by repeatedly misstating facts. For example,
the majority opinion says: "Most of the allocations in the
final offer were either identical or close to the initial
appraisal valuation."19 "[T]he fact that most of the allocations
remained unchanged from the beginning to the end of the process
demonstrates that the appraisal served as the foundation for the
offer."20
¶71 I do not agree that $159,574 is "identical or close
to" the $0.00 that Single Source allocated for severance
damages. And, the numbers tell us that the facts did change
19 Majority op., ¶14; this factual creation is repeated at
¶31.
20 Majority op., ¶31.
13
No. 2018AP1114.pdr
during a process that started with a $133,400 initial offer to
purchase and was followed by a $403,200 jurisdictional offer.
¶72 The record shows that all totaled, Single Source
valued the property taken at $269,800 less than DOT's
jurisdictional offer. Notwithstanding the 202% increase in the
jurisdictional offer over the Single Source appraisal, the
majority opinion says that is ok given its interpretation of
Otterstatter.21 The majority opinion misreads Otterstatter.
¶73 Otterstatter involved a jurisdictional offer that was
$30,000 higher than the $240,000 appraisal that the City had
provided to Timothy Otterstatter. Otterstatter, 378 Wis. 2d
697, ¶1. This was a 12.5% increase in the jurisdictional offer
amount over the appraisal amount. Otterstatter contended, among
other things, that given the difference in the amount of the
jurisdictional offer and the amount set out in the appraisal,
the jurisdictional offer was invalid. Id., ¶2. He relied on
Wis. Stat. § 32.05(2)(b), saying that the jurisdictional offer
was not "based" "upon" the appraisal. Id., ¶24.
¶74 The Otterstatter court disagreed, reasoning that
"there is no dispute that the meaning of 'based' 'upon' is that
the appraisal must be a supporting part or fundamental
ingredient of the jurisdictional offer." Id. The Otterstatter
court said, "We see nothing in the record that undermines the
City's position that the February 2015 appraisal was a
supporting part or fundamental ingredient of its jurisdictional
offer." Id., ¶25.
21 Majority op., ¶¶24–32.
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¶75 Otterstatter also argued that the jurisdictional offer
was not based upon the appraisal because they were not equal.
Id., ¶26. The Otterstatter opinion found no statutory language
"that the jurisdictional offer must equal the appraisal on which
the offer is based." Id., ¶27.
¶76 I have no problems with Otterstatter given the facts
set forth therein, but Otterstatter does not control the outcome
in the case before us. The facts and the focus of the court's
inquiry in Otterstatter were entirely different from what we
review here. All of the items of property to which a value was
attached for the jurisdictional offer were valued in the
appraisal in Otterstatter. It was a full narrative appraisal.
By contrast, all items of Christus Lutheran's property were not
valued in the Single Source appraisal. Specifically, severance
damages under Wis. Stat. § 32.09(6)(e) were not included in the
Single Source appraisal and Wis. Stat. § 32.05(3)(d) requires
that they be included if the taking causes severance damages.
¶77 To explain further, Wis. Stat. § 32.05(3) describes
what must be included in the "Jurisdictional Offer to Purchase."
Section 32.05(3)(d) requires that the jurisdictional offer give
notice of "the amount of compensation offered, itemized as to
the items of damage set forth in s. 32.09." Section
32.05(3)(d)'s reference to Wis. Stat. § 32.09 requires the
jurisdictional offer to reach back into § 32.09(6)(e) to include
severance damages when they exist. The statutes require that
the jurisdictional offer be based upon an appraisal that has
been given to the property owner. § 32.05(3)(e) ("appraisal of
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the property on which condemnor's offer is based is available
for inspection") and § 32.05(2)(b) ("a full narrative appraisal
upon which the jurisdictional offer is based"). Because
severance damages must be in the jurisdictional offer when they
exist, § 32.05(3)(d), and because the appraisal given to the
owner must be the document on which the jurisdictional offer is
based, §§ 32.05(3)(e) and 32.05(2)(b), severance damages must be
part of the appraisal as well. When they should have been but
were not, the jurisdictional offer cannot be based upon the
appraisal as the statutes require.
¶78 The difference between the appraisal and the
jurisdictional offer in Otterstatter was $30,000, a 12.5%
increase in valuation. The difference between the Single Source
appraisal of $133,400 and the DOT jurisdictional offer of
$403,200 was $269,800, a 202% increase in valuation.
¶79 That the majority opinion sees no legal difference
when interpreting "based upon" between a 12.5% increase of the
appraised valuation where all items were valued, as was present
in Otterstatter, and the 202% increase of the appraised
valuation that excluded a required value for severance damages
is quite extraordinary. I agree with the court of appeals that
the jurisdictional offer was not based upon the appraisal that
DOT provided. The jurisdictional offer was based upon DOT's own
internal review.22
One could argue that because DOT significantly increased
22
the value of the taking over Single Source's appraisal that
should be the end of it. I disagree. First, the legislature
has required DOT to provide a full narrative appraisal so that
the property owner would have the particulars for the values set
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¶80 The majority opinion also repeats and repeats that
Christus Lutheran was told it had the right to get its own
appraisal for which DOT would pay.23 However, that Christus
Lutheran did not obtain an appraisal has nothing to do with
whether DOT complied with its statutory obligations to "provide
the owner with a full narrative appraisal upon which the
jurisdictional offer is based." Wis. Stat. § 32.05(2)(b).
¶81 When a statute requires that an act be done and the
power of condemnation cannot be exercised without that act, its
omission is a fundamental defect in the DOT's attempt to obtain
condemnation jurisdiction. See Waller v. Am. Transmission Co.,
LLC, 2013 WI 77, ¶6, 350 Wis. 2d 242, 833 N.W.2d 764 (explaining
that when a condemnor does not include an uneconomic remnant in
a partial taking, a right-to-take action will lie). DOT was
required to provide Christus Lutheran with a "full narrative
appraisal upon which the jurisdictional offer is based and a
out in the appraisal. In the condemnation before us, the
property owner has been given no explanation about why DOT chose
$159,574 as the amount of severance damages when Single Source
chose $0.00. Further, Single Source's appraisal is not "full."
It does not include all that the DOT is taking. Second, after
condemnation, the church building will be only 9 feet from
Highway 15's right-of-way. It is possible that Christus
Lutheran's congregation may be required to move the church
building to another location on the property in order to
continue to use it for religious services. Wisconsin Adm. Code
§ Trans 233.08 (Setback requirements and restrictions) indicate
moving the church building should have been a concern that the
appraisal addressed. Perhaps DOT valued such a possibility, but
perhaps not. We don't know, and neither does Christus Lutheran.
DOT cannot substitute its internal valuation for a full
narrative appraisal.
23 Majority op., ¶¶6, 32.
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copy of any other appraisal made under par. (a)." Wis. Stat.
§ 32.05(2)(b). Because the jurisdictional offer here was
required to include severance damages, the Single Source
appraisal that contained no severance damages was not an
appraisal on which the jurisdictional offer was based. DOT's
failure to provide such an appraisal is a fundamental defect in
its attempted jurisdiction to condemn Christus Lutheran's
property.
III. CONCLUSION
¶82 Because DOT failed to comply with Wis. Stat.
§§ 32.05(2) and (3), it ignored fundamental statutory
obligations necessary to its jurisdiction to condemn Christus
Lutheran's property and, therefore, DOT lacks jurisdiction.
Jurisdictional errors cannot be overlooked. Accordingly, I
would affirm the court of appeals. Because the majority opinion
misses the interconnection among § 32.05(3), Wis. Stat. § 32.09
and § 32.05(2)(b) it erroneously interprets §§ 32.05(2) and (3),
misreads Otterstatter and creates facts to excuse DOT's failures
to comply with its statutory obligations, I respectfully
dissent.
¶83 I am authorized to state Justices ANNETTE KINGSLAND
ZIEGLER and REBECCA GRASSL BRADLEY join this opinion.
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