Wisconsin Supreme Court’s Ruling A Defeat For Administrative State

The state Supreme Court's 6-1 ruling last week is a big victory for property rights, but perhaps more significantly the court reaffirmed that it will no longer defer to state agencies on matters of law. #wiright #wipolitics Click To Tweet

MacIver News Service | Jan. 24, 2019

By M.D. Kittle

MADISON — In a ruling last week in favor of Lake Superior property owners, the Wisconsin Supreme Court checked the overreach of the oft-overreaching Wisconsin Department of Natural Resources.

The Supreme Court reversed the circuit and appeals court decisions, finding the DNR “could not reserve to itself the authority to amend the Myers’ permit” despite earlier conditions placed on it.

The 6-1 decision is a big victory for property rights, but perhaps more significantly the court reaffirmed that it will no longer defer to state agencies on matters of law.

Philip and Terrie Myers spent a lot of time and money litigating a case in which the DNR decided to amend the Myers’ building permit more than a decade after granting the couple approval to build a pier at their waterfront property on Lake Superior. They appealed two lower court rulings that sided with the government’s claim that the DNR had the authority to amend the permit.

Matthew Biegert, attorney for the plaintiffs, told MacIver News Service the Myers’ are gratified by the ruling, which ends a long, frustrating legal battle.

“They had to litigate for years and spend their money on the case,” said Biegert, an attorney with the New Richmond, Wis. -based law firm Doar, Drill & Skow. “Most people aren’t going to spend the time and effort to litigate a case to the Supreme Court, but it was a clear case in our minds of government overreach. Unfortunately, that’s not the way the lower courts saw it.”

The couple’s legal journey goes back to December 1999, when they applied for a permit to build a rock-filled pier at their waterfront property on Lake Superior’s Madeline Island, according to court documents.

Despite several objections filed, an administrative law judge in 2001 granted the Myers a permit under state statute to build the 70-foot structure. While concluding that it was “unlikely that there [would] be detrimental impacts relating to shoreline alterations,” the ALJ did add a condition. The permit could be amended or rescinded “if the structure becomes a material obstruction to navigation or becomes detrimental to the public interest.”

The DNR subsequently received complaints about the pier — 11 years later. In 2012 and 2013, a neighbor complained that the Myers’ pier caused “shoreline erosion and a loss of riparian property,” according to court documents.

The DNR hired a coastal engineer to assess the situation. He concluded that it was “extremely difficult to estimate how much if any additional littoral (or shoreline) material trapping is occurring due only to the [Myers’] newer pier structures.”

One engineer’s tepid report was enough for the government agency, which informed the Myers in 2013 that they were not in compliance with the permit granted 12 years before.

That was enough for the government agency, which informed the Myers in 2013 that they were not in compliance with the permit granted 12 years before. Then the DNR ordered the couple to make several expensive alterations to allow for the “free movement of water and sediment.”

The Myers declined. The DNR persisted, issuing a “Notice of Pending Amendment.” At a public hearing an engineer testified in support of the Myers, “asserting that the amendment was not supported by the site observations or any relevant technical evaluation.”

“On April 21, 2015, 14 years after the original permit was issued, and 15 months after the public hearing, the DNR issued an amendment which required the Myers to modify their pier …,” the Supreme Court ruling notes. The agency gave the property owners 30 days to decide on a modification plan and 18 months to complete the costly project.

The Myers sued, claiming the DNR lacked the authority to amend the permit, that they were no longer subject to the permit requirements under state statute, the peer was exempt from such regulatory enforcement actions, and the evidence did not support the DNR’s decision to amend.

An Ashland County Circuit Court agreed with the agency, rejecting the Myers’ claims, but did remand the case to the DNR for further study. Then the DNR took the case to the court of appeals, which not only found in favor of the government, it reversed the lower court’s decision to grant further finding of fact. The court of appeals concluded that the DNR did have the authority, and that the agency’s “implicit findings” effectively ended the Myers’ legal argument.

The Supreme Court’s ruling, written by liberal Justice Rebecca Dallet, declared that state law “did not provide the DNR with statutory authorization to insert” the condition into the Myers’ original permit. More so, the Myers complied with the original requirements of the permit, completing construction within the proscribed timeline. At that point, the permit expired, so the DNR did not have “authority to modify or rescind the Myers’ permit for ‘good cause.’”

“Because the DNR had no authority to amend the Myers’ permit we reverse the court of appeals’ decision,” states the ruling, written by Justice Dallet.

“Because the DNR had no authority to amend the Myers’ permit we reverse the court of appeals’ decision,” the ruling states.

Biegert, the Myers’ attorney, said the couple for years has had to live with a false portrayal, that they are somehow “despoilers of the environment.”

“That’s not the case. They are up there because they love it up there,” he said, adding that the ruling still leaves “tools of enforcement in the DNR’s tool box.”

“But they can’t do an end-run around on what they are supposed to do statutorily,” Biegert said.

And the DNR – all state agencies – can no longer assume the Wisconsin Supreme Court will simply accept its interpretation of the law without challenge.

“We have ended our practice of deferring to administrative agencies’ conclusions of the law,” Dallet wrote for the majority in cementing the court’s position change first declared in last June’s Tetra Tech case.

“The Tetra Tech decision marks a sea change in Wisconsin administrative law,” according to an analysis of published in the Wisconsin Bar Association’s Inside Track. Conservative justices had previously asked whether the practice of deferring to agency interpretations of statutes “comports with the Wisconsin Constitution, which vests judicial power in this court — not administrative agencies.”

Republicans Call Extraordinary Session To Protect Legacy Of Reforms

Last session, the Republican-controlled Legislature effectively codified into state statute the Tetra Tech declaration, removing the long-held practice of according “due weight” deference to agencies interpreting law.

At the same time, the Legislature passed legislation prohibiting agency “guidance documents” to be used as administrative rules. The law defines guidance documents and requires a full review before an agency can issue guidance.

Critics of the practice say agencies use the documents to bypass legislative oversight and review. The same problems occurred during the Obama administration, when agencies stopped creating rules and instead issued “guidance.”

The legislative reforms and the Wisconsin Supreme Court’s affirmation that the judiciary alone is ultimately responsible for interpreting law are huge defeats for the administrative state, and significant victories for liberty.