State Ex Rel. Briggs & Stratton Corp. v. Noll

302 N.W.2d 487, 100 Wis. 2d 650, 1981 Wisc. LEXIS 2707

• Court: Wisconsin Supreme Court
• Decided: March 3, 1981
• Docket: 80-1098-OA
• Status: Published

Opinions

STEINMETZ, J.

This is an original action before this court. In dispute are the date at which certain statutorily authorized worker’s compensation benefit increases take effect and the constitutional authority of the legislature in choosing that date. The facts in this case are not in dispute, the parties having filed a stipulation of facts with this court.

This court has jurisdiction over original actions by virtue of Art. VII, sec. 2 of the Wisconsin Constitution which states: “The supreme court has appellate jurisdiction over all courts and may hear original actions and proceedings. The supreme court may issue all writs necessary in aid of its jurisdiction.”

On December 5, 1979, Senate Bill 472 was introduced into the Wisconsin Legislature. Sec. 4 of this bill amended sec. 102.03 (4), Stats., as follows:

“The right to compensation and the amount thereof of the compensation shall in all cases be determined in accordance with the provisions of law in effect as of the date of the injury except as to employes whose rate of compensation is changed as provided in ss. 102.43(7) and (8) and 102.44(1) and (2) (5).”¹

Sec. 6 of the bill amended sec. 102.11(1), Stats., so as to increase the maximum worker’s compensation benefits “for injury on or after January 1, 1980.” Sec. 6 reads:

“The average weekly earnings for temporary disability, permanent total disability or death benefits for injury on or after January 1, -197-&1980, shall be taken at not less than $30 nor more than such wage rate as will result in a maximum compensation rate of 100% of the state’s average weekly earnings as determined under s. 108.05 as of June 30, 1$¥1-1979. The maximum weekly compensation rate after December 31, 1978 1980, is 100% of the average weekly earnings determined as of June 30, 1-978-1980. The average weekly earnings for permanent partial disability for injuries after January 1, 4978-1980, shall be taken at not less than $30 nor more than $07-.-5O- $105, resulting in a weekly maximum compensation rate of-$66:#?'d- Between such limits the average weekly earnings shall be determined as follows.

Sec. 30 of the same bill provided for an effective date of the amended act as follows:

“Effective date. This act shall take effect on January 1, 1980, or the day after publication, whichever is later.”

The bill in this form was delayed and therefore did not pass the legislature before the end of 1979. In 1980 the legislature’s consideration of the bill continued. Various amendments were adopted, including one offered on February 12, 1980, which created sec. 29m. This section reads:

“Applicability. This act applies to any injuries incurred, claims made or awards made after January 1, 1980.”

In this form the bill became law and was published as Chapter 278, Laws of 1979, on May 12,1980.

On April 10, 1980, John R. Byrnes of the Department of Industry, Labor and Human Relations, sent a letter to all “Insurers and Self-Insurers” affected by the act. In this letter he told of the increases in maximum benefits authorized by the bill and informed recipients that “the benefit increases contained in the bill are retroactive to January 1, 1980.” He wrote that “The retroactive feature of these increases requires you to recalculate benefit payments to individuals injured on or after January 1,1980 . . . .”

If Mr. Byrnes’ directive is enforced, approximately 10,000 claims based on injuries occurring between January 1 and May 12, 1980, inclusive, would be affected. Petitioners are among those employers who would bear the burden of recalculating and paying the retroactively increased compensation on some of those claims. They brought this suit, arguing that the increase in compensation is not retroactive to January 1 but actually applies only to claims based on injuries occurring on or after May 13. They argue in the alternative that if the increase in benefits does by its terms apply to claims based on injuries occurring between January 1 and May 12, it is unconstitutional as a retroactive law. We find that the petitioners’ second argument has merit.

Two issues are raised by this case: (1) Do the statutory amendments in question require increased compensation benefits for claims based on injuries which occurred on or after January 1, 1980, and before May 13, 1980? And, (2) if such increased benefits are required, is the law which requires them unconstitutional? Our answer to both of these questions is in the affirmative.

It is undisputable that if the bill authorizing- the increases in question had become law before the end of 1979, the increases would apply to all claims arising out of injuries occurring on or after January 1, 1980, and this case would never have arisen. Secs. 4, 6 and 30 of the bill are in harmony on this point. Sec. 4 states that compensation shall be determined “in accordance with the provisions of law in effect as of the date of the injury. . . .”² Sec. 6 raises benefits “for injury on or after January 1, 1980” and sec. 30 provides that the law shall take effect “on January 1, 1980, or the day after publication, whichever is later.” If the bill had been enacted and published before January 1, then all three of these sections would refer to and would commence operation on the same date: January 1,1980.

Benefit increase bills passed since 1972 have always been passed before the start of the new year and have authorized increases starting on January 1 of the following year. The bill at issue in this case appears to have been planned in the same pattern as its predecessors. Unlike the other benefit increase bills, however, this one was delayed and when the new year began, it still had not been enacted. On February 12, 1980, sec. 29m was added to the bill. This section provides that the act “applies to any injuries incurred, claims made or awards made after January 1, 1980.” It is clear that this section was intended by the legislature as a cure for its inability to pass the bill before the end of 1979. Without the addition of sec. 29m, secs. 4 and 30 would have limited the benefit increases to claims based on injuries occurring after the effective date of the statute, rather than on all injuries on or after January 1. Sec. 29m was intended to reverse these consequences and make the benefit increases payable as though the bill were enacted, like its predecessors, before January 1. If this were not the intent of sec. 29m, then that section would be superfluous. As we stated in State ex rel. Knudsen v. Board of Educartion, 43 Wis.2d 58, 65, 168 N.W.2d 295 (1969) :

“It is a cardinal rule of construction that a statute must be construed if possible so that every portion of it is given effect. Wilmot Union High School Dist. v. Rothwell (1965), 27 Wis.2d 228, 235, 133 N.W.2d 782. A statute should be so construed that no part of it is rendered superfluous by the construction given.”

In view of the previous pattern of the legislative enactments, the late date at which this section was added, and the clear language of the section itself, we must conclude that the legislature intended the increases to be retroactive to January 1, even though the hill did not become effective until May 13.

It is true that the general rule is that an amendment to the statutes takes effect when it is enacted and will not be considered retroactive “ ‘unless a contrary intention is expressly stated or necessarily implied.’ ” Dallmann v. Dallmann, 159 Wis. 480, 486, 149 N.W. 137 (1915). In this case, however, such intention is inescapable and we conclude that the legislature intended the amendments to apply starting on January 1, 1980, even though the statute was not enacted until months afterward.

Having found the intent of the statute to be retroactive, we must consider its constitutionality. The general rule is that “A statute dealing with substantive rights cannot affect rights vested on its effective date.” Estate of Riley, 6 Wis.2d 29, 37, 94 N.W.2d 233 (1959). A legislature may not constitutionally enact a law which impairs vested rights acquired under prior law, nor may it “enact retrospective laws creating new obligations with respect to past transactions.” Haase v. Sawicki, 20 Wis. 2d 308, 312, 121 N.W.2d 876 (1963). If the worker’s compensation statutes vest rights and fix obligations as of the date of the injury, then any law which attempts to change those rights and obligations after the date of injury is unconstitutional. This court has never specifically held that the compensation laws fix rights and obligations as of the date of injury. We have held, however, that the right to compensation fully accrues at the time of injury. Milwaukee v. Industrial Comm., 185 Wis. 307, 201 N.W. 251 (1924). We have also held that the amount of compensation benefits is determined according to the law as of the date of the injury. Western Condensing Co. v. Industrial Comm., 234 Wis. 452, 456, 291 N.W. 339 (1940); Discher v. Industrial Comm., 10 Wis.2d 637, 103 N.W.2d 519 (1960). We think it reasonable to conclude from these cases and from the statutes themselves that the right to compensation • is vested and the amount of the obligation is fixed as of the date of the injury. Sec. 102.03(4), Stats., was in effect at the time of the injury. On the dates between January 1 and May 12, 1980, inclusive, when the injuries at issue occurred, the statute read:

“The right to compensation and the amount thereof shall in all cases be determined in accordance with the provisions of law in effect as of the date of the injury . . . .” Sec. 102.03 (4), Stats. 1977.

When the injuries in question occurred, this statute operated immediately to vest the right to compensation and fix the amount thereof “in accordance with the provisions of law in effect as of the date of the injury.” The maximum amount of compensation at that time was specified in sec. 102.11(1), Stats. 1977. These rights having vested, subsequent non-remedial legislation may not constitutionally impair them.

Wis. Bingo Sup. & Equip. Co. v. Bingo Control Bd., 88 Wis.2d 293, 306, 276 N.W.2d 716 (1979) stated:

“A retrospective statute is unconstitutional if its effect is to deprive a person of life, liberty or property without due process of law. Schultz v. Vick, 10 Wis.2d 171, 175, 102 N.W.2d 272 (1960) .”

In Haase v. Sawicki, 20 Wis.2d 308, 121 N.W.2d 876 (1963) the court held, “The legislature may not constitutionally enact retrospective laws creating new obligations with respect to past transactions.”

Sec. 102.03(4), Stats., set the right to compensation of the employee and the amount thereof which was the employer’s obligation in accordance with the provisions of law in effect as of the date of the injury. To give the law the effect argued for by the state would retroactively affect the obligations of the employers already set by law and would be a violation of Art. I, sec. 1 of the Wisconsin Constitution. This court has held:

“It is well settled by Wisconsin case law that the various freedoms preserved by sec. 1, art. I, Wis. Const., are substantially the equivalent of the due-process and equal-proteetion-of-the-laws clauses of the Fourteenth amendment to the United States constitution. Pauly v. Keebler (1921), 175 Wis. 428, 185 N.W. 554; Boden v. Milwaukee (1959), 8 Wis. (2d) 318, 324, 99 N.W. (2d) 156; and Lathrop v. Donohue (1960), 10 Wis. (2d) 230, 235, 102 N.W. (2d) 404.” Haase, supra, at 311 n. 2.

There was no emergency or catastrophe present in this case, such as a war, as was in the case of Schmidt v. Wolf Contracting Co., 269 App. Div. 201, 55 N.Y.S.2d 162, 166-69 (1945), cited by the state. This is not to rule that the legislature may enact laws which have retroactive application under its police powers only in emergency situations. This court did hold in State ex rel. Bldg. Owners v. Adamany, 64 Wis.2d 280, 288, 219 N.W.2d 274 (1974) :

“To say that the act is not unconstitutional because it outwardly serves some public purpose says but little, since the more important challenge to the law is whether the public purpose served is so important and exigent that it will justify the invocation of the state’s police power in derogation of constitutionally secured rights.”

Sec. 29m was placed in the bill entirely for the purpose of off-setting the late adoption by the legislature of this law and therefore does not rise to the sustainable position of the exercise of the state’s police power to affect rights retroactively whether they be contractual or vested.

Having determined that the statutory provisions for increased compensation,³ insofar as they apply to claims arising from injuries occurring between January 1 and May 12, 1980, inclusive, are unconstitutional, it only remains to decide how much, if any, of the statute may be saved.

The general rule as to whether part of a statute remains to decide how much, if any, of the statute may constitutional is that:

“A statute may be unconstitutional in part and yet be sustained with, the offending part omitted, if the paramount intent or chief purpose will not be destroyed thereby, or the legislative purpose not substantially affected or impaired, [or] if the statute is still capable of fulfilling the apparent legislative intent . . . 82 C. J.S. Statutes sec. 93 (a) (1958).

This court has adopted this rule. In Bence v. Milwaukee, 84 Wis.2d 224, 233, 267 N.W.2d 25 (1978), we said:

“There is ample precedent to permit a court to sever from an ordinance or legislative enactment that portion of an act which is unconstitutional and to declare that the remaining portion is valid. As a general matter, the determination of whether an invalid portion so infects the remainder of the legislation as to require the entire law to be invalidated is a question of legislative intent. City of Madison v. Nickel, 66 Wis.2d 71, 223 N.W.2d 865 (1974); State ex rel. Milwaukee County v. Boos, 8 Wis.2d 215, 99 N.W.2d 139 (1959) ”

Some cases from other jurisdictions are in conformity with the above rule but are even more specifically applicable. For example, the case of State v. Davis, 132 Ohio 555, 9 N.E.2d 684 (1937), dealt with a statute which gave interurban railroads a three-year exemption from certain taxes. The statute became effective on October 19, 1933, but exempted the railroads from taxation commencing on January 1, 1932. The Supreme Court of Ohio declared the statute unconstitutional insofar as it acted retroactively but declared that “the invalidity of a statute, in so far as it is retroactive in terms, may not render it invalid in its prospective operation . . . .” The court concluded that:

“The obvious intent and purpose of the legislation under consideration to exempt a certain property from taxation for a specified period of time will not be defeated if the statute is given effect only prospectively, though that results in only a partial accomplishment of the full object and purpose sought. Hence, the statute should be held valid and effective in so far as it is not retroactive.”

The Wisconsin Worker’s Compensation Act has a long history. Wisconsin employees have been provided protection by the act continuously since 1911. Benefit ceilings payable under the act have been raised many times. The bill which became law on May 13, 1980, is one of several such raises passed in the last decade. It is obvious from the history of that bill which has already been discussed that it was the intent of the legislature to raise the maximum benefits and to raise them commencing on January 1, 1980. Because of a delay in passing the bill, increases could be made payable commencing on January 1 only by making the bill retroactive. This was accomplished by the addition of sec. 29m. It is apparent to this court that the determination that this section is unconstitutional does not “so infect [s] the remainder of the legislation as to require the entire law to be invalidated.” The intent of the legislature to increase the benefits was the paramount intent or chief purpose of the bill. This intent is still capable of fulfillment even without the unconstitutional provision for the retroactive payment. Hence, we find that although sec. 29m of the bill is unconstitutional and void, the remainder of the bill is valid, though it “results in only a partial accomplishment of the full object and purpose sought.” We conclude that with sec. 29m voided the increase in maximum benefits authorized by sec. 102.11(1), Stats., is applicable only to claims arising out of injuries occurring on or after the effective date of the statute, May 13,1980.

By the Court. — It is adjudged and declared that sec. 29m, ch. 278, Laws of 1979, is unconstitutional and void and that the increase in maximum benefits authorized by sec. 6 of that chapter shall apply to claims arising out of injuries occurring on or after May 13, 1980, and not to claims arising out of injuries occurring before that date.

1 “The subsections contained in the exception in [amended] sec. 102.03(4) relate to social security benefit offsets, supplemental benefits for permanent total disability or continuous temporary total disability for injuries occurring prior to January 1, 1976 and the renewed period of temporary total disability commencing more than two years after the date of the injury.” (Stipulation, paragraph 3.)

2 The exceptions to this rule listed in the statute are clearly irrelevant to this case.

3 “The average weekly earnings for temporary disability, permanent total disability or death benefits for injury on or after January 1, 1978 1980, shall be taken at not less than $30 nor more than such wage rate as will result in a maxmium compensation rate of 100% of the state’s average weekly earnings as determined under s. 108.05 as of June 301979. The maximum weekly compensation rate after December 31, 4078-1980, is 100% of the average weekly earnings determined as of June 30, 4&Q-1980. The average weekly earnings for permanent partial disability for injuries after January 1,-1078 1980, shall be taken at not less than $30 nor more than -$97.50 $105, resulting in a weekly maximum compensation rate of -$65- $70. Between such limits the average weekly earnings shall be determined as follows . . . .”