560 N.W.2d 280
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PAUL BALTER AND REID S. BARKER, PLAINTIFFS-APPELLANTS, v. TOWN OF DELAVAN AND TOWN OF DELAVAN BOARD OF REVIEW, DEFENDANTS-RESPONDENTS.
Court of Appeals of Wisconsin.
No. 96-0171Oral argument October 30, 1996
Opinion Released December 27, 1996
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APPEAL from an order of the circuit court for Walworth County: JOHN R. RACE, Judge. Affirmed.
On behalf of the plaintiffs-appellants, there were briefs by Alan Marcuvitz and Robert L. Gordon of Weiss, Berzowski, Brady Donahue of Milwaukee. There were oral arguments by Robert L. Gordon.
On behalf of the defendants-respondents, there was a brief by Steven R. Wassel and Steven C. Harvey of Law Offices of Wassel, Kilkenny, Danz, Mistrioty Lettenberger of Delavan. There were oral arguments by Steven R. Wassel.
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Before Anderson, P.J., Brown and Snyder, JJ.
SNYDER, J.
Eighty-nine Town of Delavan residential property owners (hereinafter, the taxpayers) appeal from a dismissal of their § 893.80, STATS., complaint alleging that the Town’s system of property tax assessment is unfair and violates the uniformity clause of art. VIII, § 1 of the Wisconsin Constitution.[1]
The circuit court dismissed the taxpayers’ action for failure to state a claim upon which relief can be granted see § 802.06(2), Stats., concluding that the taxpayers had failed to exhaust exclusive statutory remedies addressing the complaint’s overassessment claims. We agree and affirm the dismissal of the taxpayers’ complaint.[2]
The threshold issue presented is whether the taxpayers’ action, which they concede does not comply with the statutory procedures for contesting a residential property assessment, can be maintained. The taxpayers reason that they are entitled to challenge the assessment process “in a forum entirely
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unrelated to the individual assessment appeal process” because their complaint contests the constitutionality of the Town’s assessment process rather than the value of individual property assessments.[3] They further claim that the complaint is valid because it states a claim which “precisely establish[es] a constitutional violation.”
In determining whether a complaint should be dismissed for failure to state a cause of action upon which relief may be granted, the facts pled are taken as admitted. Evans v. Cameron, 121 Wis.2d 421, 426, 360 N.W.2d 25, 28 (1985). The purpose of a motion to dismiss for failure to state a claim is to test the legal sufficiency of the complaint. Id.
Whether a complaint properly pleads a cause of action is a question of law which we decide without deference to the circuit court. Heinritz v. Lawrence Univ., 194 Wis.2d 606, 610, 535 N.W.2d 81, 83 (Ct.App. 1995). Since pleadings are to be liberally construed, a claim will be dismissed only if it is “quite clear that under no conditions can the plaintiff recover.”
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Evans, 121 Wis.2d at 426, 360 N.W.2d at 28 (quoted source omitted).
Sections 70.47(13), 70.85 and 74.37, STATS., provide the exclusive method for residents to challenge a municipality’s bases for the assessment of individual parcels. See Bourque v. Wausau Hosp. Ctr., 145 Wis.2d 589, 594, 427 N.W.2d 433, 435 (Ct.App. 1988) (when the legislature provides a comprehensive statutory remedy, it is deemed to be the exclusive remedy). The taxpayers concede that each of the above statutory sections requires that the property owner first appeal the assessment to the board of review.[4] Nonetheless, they argue that board of review appeals are not the exclusive remedy if residents challenge the constitutionality of the entire assessment process. They contend that because their complaint “does not seek a reduction
in any individual assessment, but rather an order voiding the Town’s entire 1994 assessment,” it falls outside of the legislatively-mandated procedure for contesting a property tax assessment.[5]
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The taxpayers argue that Marsh v. Board of Supervisors, 42 Wis. 502 (1877), provides a bypass of the statutory board of review requirements. They claim tha Marsh expressly holds that a court has the power to provide relief to the citizens of a municipality when its assessment process is found to violate the constitutional requirement of uniformity. They then reason that because their complaint is couched as a challenge to the uniformity of property tax assessments in the Town, they can proceed apart from the statutory procedures outlined in §§ 70.47(13), 70.85 and 74.37, STATS.
At the outset of oral argument, counsel for the taxpayers framed the issue as: “[T]he single succinct legal question that’s raised in this appeal is whether there is any reason to believe that the 120-year-old precedent of Marsh against Board of Supervisors has been overruled.” The taxpayers maintain tha Marsh and a line of cases following it stand for the proposition that “the unconstitutionality of such an assessment can be challenged in a general equitable action brought by one or more property owners.” We do not agree that Marsh
stands for this proposition; the taxpayers misrea Marsh.
In Marsh, the court did not consider the issue of whether property assessments were fair or uniform. There, the landowners complained, inter alia, that the assessors did not follow a statutory requirement that they value the assessed lands “from actual view” as required by statute. Marsh, 42 Wis. at 503. The Marsh court agreed that ch. 130, Laws of 1868, required that an assessor verify with an affidavit “that he has valued each parcel of realty from actual view of it . . . .”Id. at 514. The court then reasoned that “an assessor who fails to make the affidavit impeaches the integrity of
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his own assessment” and found that “[t]he assessment rolls in question here . . . are impeached upon their face by want of the statutory affidavit.” Id. at 516. Th Marsh court then concluded that it had no choice but to hold that no legal tax was levied that year on the properties in the affected towns. Id. at 518.
Having addressed the dispositive issue, and having concluded that the towns’ property tax was void, the Marsh court then went on to gratuitously address the towns’ arguments that: (1) the appellants’ tax objections were merely technical, and (2) the appellants’ objection to the tax levies should fail in equity because they had not paid the taxes prior to objecting See id. at 519. In disposing of these two issues, the court, in dicta, affirmed its jurisdiction over the matter. It is this discussion which the taxpayers reference as providing justification for the instant action. The taxpayers specifically refer to the following language:
The trouble is that there is no tax; therefore no apportionment of the appellants’ share of a tax. It is thus impossible for the appellants or for the court to say what would be their proportion of a valid tax. . . . An illegal tax is none the less illegal because it may happen to be the same or even less than a legal tax might have been. When, as in this case, the whole assessment is a fraud upon the law and an evasion of the constitution, every exaction of a tax purporting to be levied upon it, is a wrong; an unlawful exaction of money, not legally or equitably payable, under false color of a legal proceeding.
Id. at 520 (emphasis added).
Read in context, the above language fails to support the taxpayers’ contention. First, the paragraph (especially the first sentence) supports the conclusion
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that the Marsh case does not reach the issue of uniform assessments or apportionment between tax parcels. Rather than providing property owners with an avenue to avoid statutory compliance in contesting tax assessments, the Marsh court applied existing statutes in holding that “violations or evasions of duty imposed by law [upon assessors as tax officers] to secure a just and uniform rule of assessment . . . vitiate the whole assessment as the foundation of a valid tax.” Id. at 510. Th Marsh court addressed the importance of adhering to the statutory requirements in property tax assessments and held that the assessors’ failure to comply with a statutory requirement voided the towns’ property tax ab initio. The property owners in Marsh were not contesting the uniformity of tax assessments but rather the legality of the property tax itself.
Not only does Marsh hold that a preliminary statutory violation vitiated the whole tax process, but the taxpayers in the instant case also ignore the Marsh
court’s recognition of the importance of statutory input to the property tax and assessment procedures. First, the court acknowledges that errors in assessment rolls are often addressed “by certiorari to review the action of boards of review.” Id. Further, after considering prior case law, the court noted: “Following closely upon the decisions of this court above cited, came various statutes providing for reassessment and retaxation, both in cases of particular and of general failure of previous taxes. Such statutes have been always upheld by this court.” Id. at 514 (emphasis added).[6]
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In sum, we disagree with the taxpayers’ reading o Marsh as providing justification for this action and conclude that the Marsh case did not address the threshold issue here presented. Rather, we read Marsh
as confined to its holding — a recognition of the power of the court to void a tax that failed to comport with statutory mandates. In Marsh, the issue of uniformity was irrelevant to the issue held to be dispositive — the assessors’ noncompliance with mandated procedures.[7]
The taxpayers also maintain that two recent cases have addressed the issue of uniformity in tax assessment and are supportive of their right to seek relief. They reference the following two cases:State ex rel. Levine v. Board of Review, 191 Wis.2d 363, 528 N.W.2d 424
(1995), and Friendship Village v. City of Milwaukee, 181 Wis.2d 207, 511 N.W.2d 345 (Ct.App. 1993). We will address the applicability of each in turn.
In Levine, two property owners argued to the board of review that the rule of uniformity had been violated because newer homes were assessed at or above fair market value, while older but comparable properties were assessed at substantially less than fair market
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value. Levine, 191 Wis.2d at 367, 528 N.W.2d at 425. The board concluded that the property owners had failed to show that the rule of uniformity had been violated. The owners then proceeded for review through a writ of certiorari. The case eventually reached the supreme court, which concluded that the assessor had used arbitrary and improper considerations. Id. at 377, 528 N.W.2d at 429-30.
The taxpayers in the instant case claim that if they can prove the facts as alleged, they will have proven exactly what th Levine plaintiffs proved and they argue that “[t]he facts as pled thus reveal a virtually certain right to recover.” While the Levine court concurred with the plaintiff property owners that the rule of uniformity had been violated, it is important to note that at the outset the Levine property owners had complied with the statutory requirements for review of their challenge. The court there did not consider the question of whether a plaintiff can avoid statutory prerequisites to review by asserting a claim of a constitutional violation. Therefore, while the Levine court ultimately concluded that the rule of uniformity had been violated, that holding does not speak to the threshold question of the instant case.
Friendship Village, the other case offered by the taxpayers, is also factually distinguishable. The plaintiffs there argued that their property was exempt from taxation and sought a declaratory judgment against the city. The city responded that its motion to dismiss should be granted because the plaintiffs had not proceeded under § 74.35, STATS., which “provides the exclusive remedy for a taxpayer seeking determination as to the legality of the assessment of allegedly exempt property.” Friendship Village, 181 Wis.2d at 215, 511 N.W.2d at 348. The court there
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concluded that consistent with Family Hosp. Nursing Home, Inc. v. City of Milwaukee, 78 Wis.2d 312, 325, 254 N.W.2d 268, 275 (1977), “litigation over whether property is exempt from taxation is not generally subject to limitations which may apply to other property tax disputes.” Friendship Village, 181 Wis.2d at 216, 511 N.W.2d at 349.
While Friendship Village does hold that a challenge arising from a claim that property is tax exempt is outside the purview of the legislatively-mandated procedure for board review, we conclude that the court’s holding in Friendship Village is not controlling as to the question of whether a challenge to the uniformity of a tax assessment procedure can be maintained without compliance with the statutory guidelines. A claim that property is exempt from taxation is a pure question of law and as such is not dependent upon the development of evidence in a board of review hearing Cf. id. at 218-19, 511 N.W.2d at 350 (summary judgment methodology applied to the question of whether property is exempt from taxation was proper). In contrast, when an issue is raised of whether the rule of uniformity has been violated, the assessor’s practices and bases for the contested assessments would be key to making that determination. We conclude that neither Friendship Village nor Levine speaks to the precise question raised in the instant case.[8]
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We conclude that the instant action cannot be maintained without initial compliance with the statutory mandates for review by the Board. It is a fundamental principle of statutory construction that when a legislature has enacted a comprehensive statutory scheme, such is deemed to be exclusive. See Bourque, 145 Wis.2d at 594, 427 N.W.2d at 435. Additionally, when the statutory scheme provides for administrative proceedings, followed by judicial review of the administrative decision, a plaintiff must exhaust the administrative remedy before recourse to the courts Id. By failing to seek review by the Board, the taxpayers have prevented the Board from considering the claimed uniformity violation and concomitantly reviewing the bases for the valuation of properties in the Town. While there have been unique instances where a court has found the statutory requirements for board review to be inapplicable, we conclude that the instant case is not such a case.
Finally, the taxpayers dispute the circuit court’s finding that even if it found the challenged assessment unconstitutional, the court would be unable to provide relief to the taxpayers. They cite § 75.54(1), Stats., for the following language:
In all actions in any court of this state, in which either party seeks to avoid or set aside in whole or in any part any assessment . . . if the court is of the opinion, after a hearing had, that . . . said assessment, tax or tax proceeding should be set aside, the court shall immediately stay all proceedings in such action . . .
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until a reassessment of the property therein can be made . . . .
Notwithstanding the above, the taxpayers’ contention that the circuit court erroneously concluded that it could not provide relief is without foundation. Sections 70.47(13), 70.85 and 74.37, STATS., provide a comprehensive means to challenge property tax assessments. The circuit court is not without authority to provide a remedy for a procedurally correct action. However, based on the foregoing analysis, the absence of support for the taxpayers’ threshold contention that their complaint was properly before the circuit court defeats this final claim. We affirm the circuit court’s dismissal of the action.
By the Court. — Order affirmed.
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