*1 Plaintiff-Respondent-Petitioner, L. Paul Wipperfurth, Company Wisconsin, Inc., U-Haul Western
Defendant-Appellant.
Supreme Court Argued April 29, 1981. No. March 1981. Decided 80 -1 44.
(Also reported 767.) in 304 N.W.2d petitioner by For the there were briefs James S. Gro- din and argu- Grodin & Grodin of Milwaukee and oral by ment James S. Grodin.
For the defendant-appellant there awas brief Riteris, Andrew O. Ellen Michael, E. Sward and Best & Madison, Friedrich argument and oral Mr. Riteris. STEINMETZ, judge, J. The trial the Honorable P. Jones, summary declaring judgment Charles entered 135, Stats., ch. Law, the Wisconsin Dealership Fair grant- retroactive and constitutional. The trial court also petitioner’s ed request temporary restraining for a placing order petitioner (Paul over the Wipperfurth) L. protection the mantle of requirements of ch. 135 pending the outcome the action. appeals
The court finding reversed the trial court provisions 135, Stats., of ch. prospective applicable therefore not petition- to the contract between (Wipperfurth) er and defendant-appellant, U-Haul (U-Haul). Company That Wisconsin, of Western Inc. regarding trial court’s restrain- court took no action *2 ques- ing appeals a found serious order. The court of concerning constitutionality of ch. 135 would the tion given application. That if it were retroactive arise supported the ambi- court stated conclusion its was legislative language guity his- of the of the act and requirement tory explicit did make retroactively. apply act Septem- parties on into a written contract entered dura- an indefinite 1969. That contract for
ber party permitted terminate the contract tion. It either to complied days notice to the U-Haul on 30 written other. terminating Wip- of the contract with perfurth dealership. terms granted Wipperfurth him Stats., has states ch. original protections contract, that is not in the the law it exercise of and that reasonable retroactive policepower. state’s argues practical is that result of this law
U-Haul agreement life-long dealership perpetual ais or even “good grantor unless the can terminate for contract days to as defined in the statute and on notice cause” If are with- the dealer. the dealer’s deficiencies corrected days grantor’s giving notice, in 60 the termina- tion cannot become effective. It is claimed the notice relationship and correction of deficiencies could continue margin constantly infinitum, ad with the dealer on the apply acceptable practice. policy To this business greatly applying prospectively from it retroac- differs contemplated tively to a contract which re- never such lationship. op- practices and
U-Haul states its business mode of changed dramatically have eration since was entered into in 1969. dealership contract, its standard
Under issue as places equipment (trailers, here, trucks, U-Haul dol- equipment lies and other associated with domestic mov- ing) filling agrees with a operator store, station who filling equipment. rent and maintain the station operator right pays so, merely no fee do for but agreement perform enters into an with U-Haul percentage services The dealer receives a mentioned. gross paid rental for fees and automative mainten- equipment. ance work done on the The title and the possession equipment remains U-Haul. provides “do-it-yourself” moving U-Haul a nationwide doing and, necessary service instead of all of the work through filling employees, operators utilized has station who, independent perform contractors, some of the agreed upon needed for services fee. expanded
As U-Haul complex its line more and so- *3 phisticated equipment, many the nature of American filling changed garage stations from full-service to a or semi a full Thus, “self-service” station. the com- plexity equipment increased, of U-Haul’s and services help filling the need for skilled mechanical in America’s stations decreased. ability
Due filling to the decrease in the stations’ management equipment, service and maintain U- its metropolitan Haul decided that in areas it would retain possession equipment direct directly of its and would perform rental, maintenance and other services to public. change
It was this judg- circumstances and business ment which led Wipperfurth’s U-Haul to terminate dealership. dealership
The originally 179, law adopted when in ch. of 1973, 135.03, Laws stated sec. Stats. that the governed agreements law April into entered after original Therefore, 1974.1 in its form the act was clear ly prospective only. Cancellation, dealerships. “135.03 grant- and alteration No directly through
or, agent employe or officer, may or ter minate, cancel, substantially fail change to renew or the com- prospec- Ch. Laws of removed the obvious adopted purpose clause and tive instead statement of legislative 135.025, construction, and sec. Stats.2 arguments Several are made the law in- whether and, interpretation so, tended to have if retroactive then whether it is an violation of unconstitutional contract clause S.U. Constitution. legislature prospective only
The did remove the sub- adopted Stats., 135.025, section and instead and sec. particularly (2) (d) chapter which stated the was “To govern dealerships, including any all renewals amend- ments, the full extent with the consistent constitu- (Emphasis tions of this state and the United States.” language added.) This allowed for but invited interpretation legislative court as to intent. The courts that, were chapter directed in sec. 135.025 “This shall liberally applied promote construed and its under- lying purposes policies.” remedial and legislative regard
Whatever the intent was in to retro- application law, dealership active it was not clear- petitive agreement dealership circumstances of a into entered April 5, good proving after without cause. burden of good grantor.” cause shall he on the Purposes; construction; “135.025 rules con variation chapter liberally tract. This and shall be construed promote purposes underlying policies. remedial and “(2) underlying purposes chapter policies are: of this “(a) promote compelling To fair interest grantors, business relations between dealers in the con- dealerships tinuation basis; on a fair *4 “(b) protect against by grantors, To dealers unfair treatment inherently superior power superior who have economic bar- and gaining power negotiation dealerships; in the “(c) provide rights To dealers with and remedies in addition existing by law; to those contract or common “(d) govern dealerships, including any To all or renewals amendments, to the full extent consistent with the constitutions of this state and the United States. “(3) chapter may by The effect of this not be varied agreement. Any or agreement purporting contract or to do so is only.” void and unenforceable to that extent
ly affirmatively and caused stated therefore has conflicting opinions the trial courts decisions of state. this appeals
The
court
decided the statute was not
applied
clear on
its face as
its intent to
retroac-
be
tively and therefore that court ruled:
concerning
question
“Since a
consti-
act's
serious
tutionality
given
if
retro-
would arise
the WFDL were
application,
active
the court must conclude that the act
agreements
April 5,
covers
This
entered into after
1974.
by
supported
ambiguity
conclusion
language
not make
legislative history,
act and the
which do
explicit
requirement
apply
the WFDL
general
retroactively.
spective operation
pro-
Therefore, the
rule of the
applies
of statutes
this
case.”3
Legislative
retroactivity
intent
toas
must be deter-
constitutionality
independent
mined
of the action.
County,
Swanke v.
Oneida
265 Wis.
60 N.W.2d
756, 62 N.W.2d7
stated:
“ ‘Retrospective operation
by
courts,
favored
however, and a law will not be construed as retroactive
clearly, by
language
express
necessary
act
unless the
legislature
implication, indicates that the
a ret-
intended
application.
roactive
The rule is the converse of the
general principle
operate prospective-
are to
statutes
ly.
legislative history
present
of this law and its
wording
interpreted
displaying
by
could an intent
legislature
dealership
pro-
that the
law be
spectively
permitted
retroactively
if
the courts.
legislative authority
This would be a surrender police powers
public purposes.
over its use of
for
determination then
would be left
the courts on a case
provide
justice
case basis and would
for uneven
at
Judge
Doyle,
Federal
best.
District
E.
James
Western
3 Wipperfurth
Wis., Inc.,
v. U-Haul
Western
98 Wis.2d
(Ct. App. 1980).
“The and of this are: “ (a) promote compelling To interest of the grantors, in fair business relations between dealers dealerships basis; the continuation of on a fair against “(b) protect To dealers unfair treatment grantors, inherently superior power who have economic superior bargaining negotiation power in and erships ; of deal- “(c) rights provide those To dealers remedies existing by law; addition contract or common consideration, total
On this court determines from the legislative history language and the of the law that legislature give intent of the was to retroactive as well prospective application to ch. That then Stats. analysis requires the court’s of the conflict between *6 application prohibition retroactive and the constitutional against obligation impairment of of the contract.4 488, Co.,
In Kuhl Motor v. Ford 270 Co. Motor challenged 71 in (1955), N.W.2d 420 was statute agreement effect at time that was made and so impairment case did not obli- consider retroactive of the gation of contract. application prospective
The Kuhl of case dealt legislation contract, the freedom while the instant on application case involves the retroactive of obligation existing on the of contracts. right contract, process protects
The due
clause
of
is,
persons
that
the freedom of
to enter into contracts
they
agreeable.
right
mutually
which
find
This
is not
unlimited,
legitimate
It
however.
can be limited
police power. Mulvaney
Tri
exercise of the state’s
v.
Body, Inc.,
760, 766,
Truck Auto
235
&
70 Wis.2d
State
;
(1975) 16
Law
N.W.2d 460
C.J.S. Constitutional
sec.
(1956).
Kuhl
210
The
case dealt with a
that
statute
grantor-dealer
in the
forbade
busi
contracts
automobile
under
dealer
be
ness
could
terminated without
grantors
cause. The
and dealers to make such
Kuhl
contracts was curtailed.
In
curtailment
legitimate
police power.
found to be a
exercise of
Bldg.
in
This court stated
State ex rel.
Owners v. Ada
many,
(1974)
64 Wis.2d
Thus, it can determined ret- this court *7 application permissible, how- roactive of is ever, making the court referred such declaration subjects “public public health, peace safety, morality, of Berman quiet, law and order” of the case. Those subjects are limit of areas that can be affected not the retroactively, they do the serious nature of but describe permissible interference with the of con- tracts. Allied Supreme
The United Court stated in States Spannaus, Steel Structural Co. U.S.
(1978): language appears unam “The of the Contract Clause biguously pass any . ‘No . . . . . absolute: State shall Obligation Const., impairing Law the of Contracts.’ U. S. not, however, I, sec. 10. The Art. ian Clause the Dracon might provision imply. words As its seem recognized, the Court has ‘literalism the construction of the contract clause . . . make it would destructive depriving pre of rogative interest of State its W. Worthen Co. v. Thom self-protection.’ of B. as, 292 U.S. 433.” Spannaus case, In the the court at stated 241: all, accepted “First of it is to commonplace aas operate that the the Contract Clause does not to obliterate police power of the States. ‘It is the settled law of impairing the of this that the interdiction statutes court prevent from State does contracts exercising pro- powers in it for the are vested such necessary for weal, common or are motion general, though good public, previously contracts may thereby into individuals be af- entered between power, in its ramifications fected. This various police power, as the an exercise the sov- is known ereign right health, lives, protect Government morals, general peo- comfort and welfare of rights paramount any ple, between individuals.’ 480.” under and is contracts Manigault v. Springs, 199 U.S. Spannaus: At 242 of meaning “If the Contract Clause is to retain at all, however, impose must be understood to some upon power abridge existing limits of a con- State relationships, tractual wise even in the exercise other- legitimate police power .... Building “In Home & Loan Blaisdell, Assn. v. 290 U.S. acknowledged . . that, the Court . despite the Con- Clause, tract the States authority retain residual to enact safeguard laws ‘to the vital people.’ interests [their]
Id., upholding at 434. In mortgage the state moratorium law, state emergency significant. the Court found First, five factors legislature had declared in the Act itself that an protection need for the of homeowners ex- Id., Second, isted. at 444. law state was enacted to protect a basic interest, societal group. not a Id., favored Third, at 445. the relief appropriately tailored to *8 emergency the designed it was to meet. Ibid. imposed Fourth the conditions were Id., reasonable. at finally, And, legislation 445-447. the was limited to the of emergency. duration the Id., at 447.” In W. B. Thomas, Worthen Co. v. (1934), U.S. the court stressed the retroactive effect of the state law and held it “invalid under the clause, since it precisely was not reasonably designed and to meet a grave temporary emergency in general the interest of Spannaus, supra, welfare.” at 243. (1935), Kavanaugh, 295 U.S.
In Worthen Co. v. contract clause invalid under the a law the court held “ court, when ‘Even the wrote for and Justice Cardozo public . the . . se invoked an excuse’ the welfare is as mortgage curity mod cut down ‘without of cannot be a ” Span spirit oppression.’ of or reason or eration supra, naus, at 243. Jersey, 431 U.S. Trust v. New United States Co.
In again recognized spite (1977), that in the court language clause, it leave room for “must absolute sovereign power,” . . . ‘the “essential attributes safeguard necessarily wel- reserved the States ” supra, Spannaus, 244. The at of their citizens.’ fare supra, Spannaus, at 244: court also stated give customary “Despite courts to state deference ‘[legis- problems, and economic directed to social laws lation tracting rights responsibilities adjusting of con- upon parties conditions must be reasonable purpose justify- appropriate to the of a character ” ing adoption.’ Spannaus In the court wrote: inquiry has, “[T]he whether the law first must be state operated impairment fact, of a con- as a substantial relationship. severity impairment
tractual measures must clear. height hurdle the state Minimal alteration of contractual stage. inquiry impair- may at its first end Severe inquiry push hand, care- ment, the other will to a on purpose examination of nature state ful legislation.” Id. at 244-45. degree anticipation Next, the court looks to the expect parties interference with their reliance on obligations of the contract. recognized Supreme presumption Court favor- necessity ing “legislative judgment to the and rea- particular measure.” United States sonableness supra, Co., Trust at 23. *9 Spannaus
The dissent decided that the con- case apply tract clause of the due to a constitution did not disagreement majority basic as to with the reasons including the framers of the constitution had for that analysis applied process clause. The dissent an of due protection of the and found the Fourteenth Amendment being Minnesota law considered constitutional. applying process analysis, In the due the dissent con- degree existing parties’ sidered the on of reliance law when contract was entered into and their an- change ticipation legislature. for or interference However, prior the dissent failed to concede that a con- relationship parties tractual between the should receive analyzed consideration when a statute which has a purpose type always social duties that creates persons burden one class of and benefit another. majority’s criticism the dissent to the reliance on the clause contract was stated as follows: opinion, any may “Under the acterized as law that be char- Court’s ‘superimposing’ new on those provided regarded creating is to for ‘sudden, substantial, unanticipated burdens’ and then subjected exacting scrutiny. to be to the most The val- idity upon judges of such a law will turn whether see generalized it problem, as a law that with a social deals temporary (as whether it is whether regulation, and, finally, be) permanent, few will operates previously subject an area apply whether its duties to a ante, persons. broad class of See at 249-250. The neces- sary consequence malleability of the extreme of these vague judges rather criteria to vest with broad sub- jective pen protect property discretion to hap- interests appeal to them.” Id. at 260-61. analysis Spannaus dissent leaves applied test of reasonableness to be to the presumption in favor of reasonableness. The majority considers several tests to be —vested rights them, degree and reliance on infringement, *10 length and rea- change, of effectiveness anticipation for a social as a solution serious of the act sonableness problem. subjective and de- purely dissent
The test of the agrees the majority entirely a pends on whether legislation problem or even social the solution of It in problem or should be solved. whether exists worthy reliability any and not is no test with effect legal being considered standard. accept appeared supra, Adamany, court in
This legislation only as the test of reasonableness (due process of the constitution clause to the contract discussed). At the court stated: application was not purpose if there presume a constitutional “We will legislation upon can which the any is be reasonable basis knowledge by of this court. explained facts within appar- and can be can nature facts skeletal Those be legislation. accept a We would face of ent from the explaining purpose legislative by have been founded declaration be served act, presume that declaration would for we such this legislative fact-finding. upon But totally here, speculatively are absent such facts can legislation. however, Speculation, justify we this contrary to conclusions that are to those can also lead urged by of this the defenders law.” foregoing judicial provide test to would not Adamany legislation, the rule in the and it was not case. Adamany also at 299:
The court stated Kuhl, philosophy of adheres to the basic “This court legislative supra, unequivocal that an declaration of policy, public made either before or after the execution part contract, of that contract if of a becomes legislature makes it clear that such is intention determined, by legisla- either recitals in the if it can be judicial notice, that vital tion or interests will given impaired if the not effect and vital be interests will be enhanced legisla- enforcement of the tion.” retroactivity did
Kuhl in this consider stated quote, the con- since the law in existence when there not the tract was and therefore issue was executed impairment contract, rather the but right to the freedom contract.
Finally, Adamany, stated: court “Hence, that, police power clear seems for constitutionally protected of Wisconsin affect the state legis- contract, there should evidence that the people for necessary lation is interests vital state. ... *11 “A modify, that seeks to statute invocation of the guaranteed police power, as the show and serves a vital are constitutionally right, such right contract, carefully should be drawn to power necessary exigent that the use of such is government. purpose courts While willing indulge any presumption reasonable police-power-type legislation, they ought sustain not be speculate conjure up possible explanations asked to to legislative support act.” at Id. 300-03. showing There been no disruption has that the severe expectations of contractual parties of these was neces- sary important problem. to meet an social The retro- application dealership existing active law on this contract its established was severe as rights to substantive of the contract not as to rem- edy parties. application Retroactive here affected rights obligations substantially. vested The dealer- ship carefully law was not so drawn to show the use of police power reasonably necessary exigent government purpose and it served a vital to retro- actively affect in existence contracts when it was made fact, equivocating language In law. of sec. 135.025 (2) (d), Stats., legislative does not demonstrate the de- necessity police termination apply power retro- actively. Therefore, applica- court holds retroactive 185, Stats., prohibited tion of eh. as unconstitutional I, sec. of the United Art. States Constitution. By appeals the Court. —The decision of court of affirmed. (concurring).
STEINMETZ, J. writer would This majority opin- hold that the distinction discussed obligation ion between the to contract and significant is one that leads difference. having The framers of the constitution considered post prohibition ex applica- facto law in the constitution obligation impairment. However, to the ble of contract English due to Blackstone’s commentaries on the common time, adopted law at the the constitution was with the distinction made.1 obligation belief was of contract needed
protection interference, protecting from as well as against post ex facto laws and therefore each needed a separate statement. post of contract and ex facto clauses I,
are both the same constitution, section of the Art. 10. protection The dual sec. statement of was done to existing accommodate the common law distinctions as a compromise adoption to accommodate of the constitu- *12 tion.2 Supreme
The United in in States Court cases cited the majority opinion has held that “the contract clause does operate police power to obliterate the of the States.” However, protections with it carries so that the when deliberately by state to avoid it decides or contravene it by state, a law, retroactive invasion of contracts the relying party legislation, the on the of effectiveness the post prohibition applied Blackstone ex facto asserted to crim only. inal laws 2 Chafee, Rights Jr., Constitution, Z. Three Human the Uni versity Library Press, Congress Catalog of of Kansas No. 56- (1956). prepared produce uphold
must be to the facts statute. Certainly, challenger required the the statute is impairment the show the law a works substantial by convincing proof. clear Once terms and done, however, state, Wipper- that the or in is this case furth, relying statute, party the on the must demonstrate compelling by public a the interest is served the law or existing social need invasion of for the proof, contracts. is no a There burden of but rather by Wip- standard of must be review courts. perfurth required this case was come forward proof demonstrating there is a social and need facts abrogate present sufficiently interest is provision. the constitutional The constitution is government basic and and fundamental contract between its citizens. analysis by
There has distinction in been the courts involving right between to contract cases which is liberty protected interest the Fourteenth Amendment against prohibition impair- and the constitutional existing ment of contracts. contract, are
Where liberties considered in the balancing it is a matter of of interests between conflict- ing rights society. legislature plenary Here the has powers to declare reasonable classifications of interests process equal so protection provided, that due are legislature prohibition against but the is limited making prospec- invidious distinctions. In the case challenger laws, tive has the bur- persuading beyond den of a reasonable courts doubt unconstitutionality It act. reasonable proper place persuasion to so the burden of since legislature presumed constitutionally to act and courts every legislation. will make to save effort However, directly intentionally when state invading acts protection obliga- the constitutional *13 through legislation, tion of contract clause retroactive obligation only of com- reasonable the state has the ing police the forward with facts show exercise power necessary, public that vital reasonable and given legislation impaired will if is not interests the effect. stated, Federalist, No. 78
Alexander Hamilton the ought pre- “or, words, the to be other Constitution people statute, ferred to the intention of the agents.” intention of their major specific
Three areas concern will factors be examined: strength “[T]he nature and served interest statute, the modifies extent to which the statute abrogates right, preenactment or the asserted and right nature statute alters.”3 considering application
When the retroactive of a contract, statute on the of a tests applied depending will be on the circumstances involved degree rights, the effect on of effect are ing vested be- past substantial, minimal or the reliance on rules regulations, anticipation change, reasonableness of problem, population solution to social the extent of the length apply (tem- affected, of time the will porary permanent), and is the effect on substantive rights obligations of contract or remedies. right between the distinction to contract and constitutionally protected of contract is
recognizedby legal legal texts and writers.
16A C. J. S. Constitutional Law sec. at 607-09 (1956) states: legal “The kinds, make contracts of all with- deception, part
out fraud or liberty possessed by every of the civil juris, individual who is sui Supreme Hochman, Constitutionality Court Legislation, Retroactive (1960). 73 Harv. L. Rev. *14 right liberty property but is both a within taking liberty protection guaranties against of the of liberty property process or without due of law. of guaranteed by process contract which is of law due is freedom from ar- provisions clauses in constitutional bitrary restraint; or and neither the unreasonable state governments may impose nor federal such restraint. qual- absolute, While freedom of contract is not an but ified, right, is, subject therefore, to reasonable re- welfare, of . straint the interest . . never-
theless, abridgment by general freedom is the rule and restraint or exception justified only an can exceptional (Empha- the existence of circumstances.” added.) sis Law, (1956) 16 C. J. Constitutional at S. sec. 274 states: provisions “The federal and state contain constitutions language essentially which in different but same impairment obligation effect forbid con- of tracts that are lawful when made and that are not sub- ject sovereign governmental power the fair exercise of general provisions to conserve the welfare. Such are
mandatory, apply protect alike all contracts and all of such contracts from or destruction im- pairment legislation.” by subsequent (Emphasis added.) Jur.2d, 16A Am. (1979) Law, Constitutional sec. 591 at 522 states: “Although the term ap- contract’ does not ‘freedom of pear in the United Constitution, States and has been de- scribed an doctrine, recog- abstract it has been held or by nized part the courts that freedom of contract is a of liberty protected process the due clauses Fifth and (Emphasis Fourteenth Amendments.” added.) following
At 525 the is stated: “It has right liberty been said that of of differs from a fundamental right, constitutional from right liberty body person, or from the right property, including existing contracts, right from the equality, right and from the right right, liberty, political a vested in that it is not specific protected con- content, a of definite position guaranties. been Elsewhere stitutional has.right.” liberty a fundamental contract is taken added.) (Emphasis Power, Freund, Police made same distinction is (1904). sec. Law, sec. 687 Jur.2d, Constitutional 16A Am. ordinary in its ‘contract’ is used “The term at 682 states: Constitution of the United States in the clause sense *15 obligation forbidding impairing of the state contracts.” 689 at 687-88 states:
Sec. obligation tending “Although impair of the a statute existing inoperative the at as to contracts is a contract may passage, valid and be it nevertheless of its time provision operative The of contracts. as to future any pass that shall which declares no state Constitution apply obligation impairing does not of contracts law making prior of a contract ob- a law enacted to ligation statute impaired, to a to be but which is claimed of making of the con- after the of a state enacted obligation properly cannot contract tract. impaired by in force when the con- a statute said to be presumed in it that it made, for such cases tract was existing contemplation made in law. was may legislate therefore, it state, sees to future contracts as as accordingly, only, prospective fit, if a law is guaranty obligation of contracts it is—so far is concerned—valid.” recognized distinction between has
This court right prospective of contracts to contract already effective. a statute in existence when becomes Stamp Trading Cases, 613, 618, 166 166 N.W.
In Wis. (1917), 54 the court decided: impairing “(3) not unconstitutional as The act is being prospective opera- contract; it trading stamps,
tion, tokens, with sales made the use of and does affect bonds, tickets, or similar devices in connection goes before into effect.” 193, Eskofski, Pawlowski v. N.W. In Wis. Supreme court discussed United States this subject Court on the cases as follows: long ago any statute, court held that whether “That not, operated deprive party to a remedial or that antedating contract the enactment statute him that contract void valuable as to that contract. Edwards If existing plication secured to Kearzey, 96 595. U.S. v. substantially pre- a statute lessens value provision ap- the constitutional bars Many of it the contract. decisions of supreme court of the United States have so held. This Howard, held back as far as 6 where it is said Sharp 327) (p. Bank Planters’ v. : “ impaired ‘One of the tests that a contract has been is, by legislation its value been diminished. It has not, by constitution, impaired is is not a encroaching to be at all. This degree question cause, or manner or but of any respect obligation, dispensing on its ” any part of its force.’ may This retroactivity be historic law but it shows this court Supreme and the U. S. Court have recognized each “obligation the distinction between of” and “freedom to” contract. Cleary Brokaw,
In 417-18, 272 N.W. *16 (1937), 831 the court cited Hayward, McCracken v. 608, How. 611 as follows: “ obligation .‘. . The aof contract consists in its binding on party force on the who depends makes it. This in made; the it laws existence when these are neces- sarily contracts, forming referred to all part obligation them as the measure of perform the to them right party, the one acquired by and the the other. . . . When it consummated, becomes the law the the defines duty right, compels and the party perform one
thing for, gives contracted the other a to en- performance by force the If impair the remedies then in force. any subsequent law affect to duty, diminish the toor right, necessarily the it obligation bears on the contract, of the in favor party, of one injury to the operation amounts other; any law, hence rights accruing by a denial or obstruction remedy, though professing act contract, is on directly prohibition of the constitu- obnoxious to ” tion.’ stated, In at the court “Whether the same case rights may presents another her in the future be violated question.” Banski, 361, 366, Guardianship
In
the distinction be-
(1937) the court honored
N.W. 626
“obligation
“right
follows:
to” contract
tween
of”
as
regulate
course, competent
is,
for a state
“It
priorities
whose debts are contract-
as between creditors
Bank
passage
Abilene Nat.
after the
of the statute.
ed
Dolley,
Sup.
Ct. 409.”
v.
228 U.S.
Chippewa Valley
Herbst,
In
Securities Co.
227 Wis.
Page,
the court cited 6
thereof. Whatever obligation law, impair of such does not of such contracts. To be obligation impairing invalid the mak- “must enacted after a statute be one contracts ing contract, of which is claimed ’ ” impaired.” to be Chippewa Valley case, the
In the Securities Co. same did not un- ruled statute under consideration court “right reasonably deprive plaintiff of its to” contract property deprive plaintiff and did not therefore process. without due
Historically, process court has the due this prospective Amendment of the Fourteenth standard doing however, legislation. not al- this, In the court has showing ways statute uncon- placed burden of challenger. beyond a doubt on the reasonable stitutional following challenge cases of to the In constitution- *17 ality legislation, the did not the standard of court discuss
606
Supervisors
County,
nor
Knowlton v.
burden:
Rock
9
(*410) (1859) ; State ex
Wis. 378
Northern Pac. R. Co.
rel.
v.
Commission,
Railroad
140 Wis.
121
919
145,
N.W.
320,
(1909);
Frear,
ex
Van
State
Alstine v.
142
rel.
Wis.
;
(1910)
Co.,
125
v.
N.W. 961
Nitka
Tel.
Western Union
(1912):
106,
149
492
McGovern,
Wis.
135
kern
v.
N.W.
E
157,
Outagamie
154
(1913);
County
involving classification, protection equal taxa- or uniform prospectively tion applied. following challenge prospective cases stat being
utes
unconstitutionality
standard of
required
proven beyond
to be
a reasonable doubt and the
being
challenger:
burden
on the
Norton v. Rooker—
Norton,
Rooker
(Pin.)
(1842);
v.
1
rel.
195
State ex
Wis.
Main,
Chandler
(*398) (1863);
v.
16
422
Northwest
Wis.
Superior
ern
City Superior,
National Bank
v.
Wis.
103
43,
(1899);
79
54
Groth,
N.W.
State ex rel. Busacker v.
132
283,
;
(1907)
Vallier,
Wis.
112
431
N.W.
Bonnett v.
193,
136
;
(1908)
University
Wis.
116
885
N.W.
Lawrence
Outagamie County,
244,
v.
150 Wis.
136
619
N.W.
(1912);
Widule,
Peterson v.
641,
157 Wis.
147
966
N.W.
(1914); Pauly
Keebler,
428,
v.
Wis.
554
175
185 N.W.
;
(1921)
ex
Emery,
State
rel. Carnation M. P. Co. v.
178
;
147,
Building
(1922)
Height Cases,
Wis.
607
Atty.
Constructors,
State ex rel.
Gen.
222
v. Wisconsin
279,
(1936) ;
Wis.
268
ex
N.W. 288
State
Sullivan v.
rel.
Dammann,
72,
;
(1938)
227 Wis.
N.W. 48 there is a reasonable construction uphold preserve which will it and at the same time infraction, adopt constitution from the court is bound it); Chicago State, & N. W. R. Co. legis (there presumption N.W. 557 is a enactment,
lature intended a valid
and it is to be sus
fairly
tained if in
reasonable view thereof it can be
harmony
requirements);
read in
with constitutional
*19
In
Appointment
re
Revisor,
592,
141
124
670
Wis.
N.W.
(1910)
(sustained
possible by any
if
con
reasonable
struction of the
constitution
act itself —and all
validity
mere
to its
doubts
are to be
favor of
as
solved
act);
Dulaney
Nygaard,
State ex
v.
rel.
174 Wis.
597,
question
(1921)
(the
if
reasonable construction thereof or
any reasonable
construction
the constitution —all
legislature’s power
legality being
doubts of the
or as to
validity);
Langlade
resolved in favor
State v.
County Creamery Co.,
113,
(1927)
193 Wis.
609
reasonably possible, (1949) (when
stat
stitutional
if it
possible
at
is
all
do so—all
presumed
acts are
every presumption
constitutional and
indulged
must
possible
be
at
sustain the law if
all
—if
any doubt exists, it must be resolved in favor of
con
stitutionality
statute); Watchmaking Examining
of a
Bd.
Husar,
526,
(1971)
(the
v.
49 Wis.2d
611 Nieman, (1939); Estate 452 283 N.W. 230 Wis. of rel. (1952); ex 181, 54 State Ogg, N.W.2d Gerhardt, Est. Bd. Real Wis.2d Exam. (1968).
N.W.2d of this Company in the circumstances U-Haul showing the retroactive came case forward evidence application dealership had effect law substantial obligations itself on the between Wipperfurth established, Wipperfurth. that was Once equivocat- beyond nor facts did not demonstrate offer ing language an eco- the statute. statute stated bargaining power. did not It state nomic need to even general- general public nor interest of the social need impairment ly would be retroactive served obligation of contract. impairment case
Had the this quality Wipperfurth’s minimal, quantity or been might first, not have considered since evidence been challenger law not have would shown substantial protec- impairment to the for entitlement constitutional Once, im- however, contract clause. substantial tion of challeng- by the pairment of is demonstrated relying er, party must for- on the come demonstrating compell- with facts the courts ward ing necessity requir- there is a need that social ing police power. Wipperfurth of the state’s the exercise failed to case. has do this majority opinion For the in the reasons this con- curring opinion, this writer would find unconstitutional application 135, Stats., ch. the retroactive the ob- existing ligation of contracts.