COURT OF APPEALS DECISION DATED AND FILED January 21, 2009 David
R. Schanker Clerk of Court of Appeals |
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NOTICE |
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This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
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Appeal No. |
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STATE OF WISCONSIN |
IN COURT OF APPEALS |
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DISTRICT I |
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City of Plaintiff-Respondent, v. MK Investments, LLC and Makbul Sajan, Defendants-Appellants. |
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APPEAL
from a judgment of the circuit court for
Before Curley, P.J., Brennan and Kessler, JJ.
¶1 CURLEY, P.J. MK Investments, LLC and Makbul Sajan (collectively referred to as MK Investments) appeal following a judgment entered in favor of the City of Milwaukee (the City). MK Investments argues that the trial court erred when it dismissed its counterclaim against the City.
¶2 At issue is whether the allegations set forth in MK
Investments’ counterclaim are sufficient to state a claim for a deprivation of MK
Investments’ constitutional rights or interests under 42 U.S.C. § 1983.[1]
Because the counterclaim is devoid of
any allegations regarding a municipal policy or custom which resulted in
constitutional infringements, we conclude that MK Investments’ counterclaim
does not present a cognizable claim under §
1983. Accordingly, we affirm the
trial court, albeit on different grounds.
I. Background.
¶3 The City filed a lawsuit against MK Investments seeking to
recover the costs associated with razing and removing a building owned by MK
Investments located at
¶4 In response, the City filed a motion seeking dismissal of MK Investments’ counterclaim, contending that MK Investments failed to pursue the exclusive remedies available to it under the Wisconsin statutes and the municipal code and failed to state a claim under 42 U.S.C. § 1983. MK Investments argued that it was not properly served with a raze order, and that although Wis. Stat. § 66.0413 (2005-06) provides exclusive remedies for relief from raze orders, it does not bar MK Investments from asserting other claims, namely, a separate claim under § 1983.[2] MK Investments further asserted: “Since the improper service effectuated upon [it] was made by an employee of the [City] it is clear that it is a policy of [the City] which caused the deprivation.”
¶5 The trial court granted the City’s motion to dismiss the counterclaim. In doing so, the trial court explained that it was not persuaded by MK Investments’ argument that the exclusive remedies available to it under state statutes and the municipal code were not triggered because of defective service of the raze order. The trial court stated:
I’m also granting the motion to dismiss the counterclaim. In my view the counterclaim is barred in that the exclusive statutory remedies admittedly not pursued bar the assertion of the counterclaim.
I do not accept the fundamental premise of the Defense that the remedy, exclusive remedy provided by the statute, and I don’t want to minimize concerns that [MK Investments] has with respect to what was done and how it was done and so forth; but the simple fact of the matter is that there’s exclusive remedies provide[d] by statute, a forum’s provided for redress of those supposed grievances. They weren’t pursued. They had to be pursued pursuant to the statute. And because they weren’t they can’t be asserted here.
….
Not every municipal employee becomes a party to any lawsuit in which that municipal party is named … [s]o I don’t believe that the service was defective.
That also as I understand the theory of 42 U.S.C. [§ 1983] liability[,] I also think that determination renders the substantive counterclaim deficient because as the parties have advised me in their briefs in order to make this type of 42 U.S.C. [§ 1983] claim you have got to allege[] a policy, practice, uniform policy practice, or procedure on the part of the City that violates a person’s constitutional rights.
My understanding of what is being asserted here is that a[] uniform policy, practice, or procedure that forms the basis of the claim is the uniform policy, practice, or procedure of the City serving notice through employees who by statute are barred from serving those notices.
And because in my view the statute does not render those employees as ineligible to serve the notice, clearly there is not a uniform and deficient policy, practice, or procedure that would render the City liable under 42 U.S.C. [§ 1983].
¶6 The City subsequently filed a motion for summary judgment on the underlying complaint. The trial court granted the motion, resulting in a judgment for the City in the amount of $53,270.14. MK Investments now appeals.
II. Analysis.
A. Standard of Review.
¶7 Whether a counterclaim states a claim for relief presents a
legal issue that we review de novo. See Hausman v. St. Croix Care Ctr.,
214
¶8 Upon review, all facts that are alleged in a complaint or, in
this case, a counterclaim, must be taken as true, and “a claim should be
dismissed as legally insufficient only if ‘it is quite clear that under no
conditions can the plaintiff recover.’” Morgan
v. Pennsylvania Gen. Ins. Co., 87
¶9 At the outset, we note that the City filed a motion to
dismiss pursuant to Wis. Stat. § 802.06(2)
contending that MK Investments was properly served with the raze order, failed
to pursue the exclusive remedies available to it under the
If on a motion asserting the defense described in par. (a) 6. to dismiss for failure of the pleading to state a claim upon which relief can be granted … matters outside of the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in s. 802.08, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by s. 802.08.
¶10 With its brief in support of its motion, the City filed exhibits and an affidavit documenting, among other things: the date the raze order was posted on the property; the date the raze order was recorded with the Milwaukee County Register of Deeds; the date the raze order was personally served on Makbul Sajan; and the City employees responsible for these actions. In responding to the City’s argument that MK Investments failed to state a claim under 42 U.S.C. § 1983, MK Investments argued: “This is a Summary Judgment Motion within the Motion to Dismiss and as such should not be considered by this court.”
¶11 In Alliance Laundry Systems LLC v. Stroh Die Casting
¶12 Neither party identified any procedural deficiencies related to the motion hearing in its appellate briefing. Nevertheless, because our review is de novo, we have not considered the extra-pleading materials and have treated the City’s motion as one for dismissal. See id. ¶17 (explaining that instead of converting the motion to one for summary judgment, “the [trial] court may refuse to consider the extra-pleading materials and treat the motion as one for dismissal”).
B. Failure to State a Claim.
¶13 In its counterclaim, MK Investments alleges the City violated
42 U.S.C. § 1983. “Section 1983, by
itself, does not create any substantive constitutional rights. [Instead, s]ection 1983 provides a remedy for
a deprivation of such rights.” Penterman
v. Wisconsin Elec. Power Co., 211
¶14 MK Investments’ counterclaim does not include facts supporting the existence of a policy or custom from which its 42 U.S.C. § 1983 claim flows. The counterclaim consists of six paragraphs and reads as follows:
COUNT ONE
Cause of Action Pursuant to 42 U.S.C. Sec. 1983 as a separate cause of action against the City, M[K] Investments, LLC and Makbul Sajan alleges [sic] as follows:
1. That [the] subject matter of this action is real
property which was located on a parcel of land known as
2. That M[K] Investments, LLC is rightful owner of that parcel of land.
3. That City of Milwaukee, by and through Department of Neighborhood Services, impaired M[K] Investments, LLC’s ownership and enjoyment of said real property and further perpetrated unconstitutional taking of the property without due process of law by authorizing the entering onto the M[K] Investments, LLC’s real property and removing the building thereon on or about January 3, 2007.
4. That, at all times material hereto, the
above-named City of
5. That, while acting under color of law, the
above-named City of
6. That, as a direct and proximate cause of the above-identified wrongful conduct perpetrated by the City of Milwaukee under color of law, M[K] Investments, LLC and Makbul Sajan incurred substantial actual financial loss [of an] approximate sum of $350,000.00, as well as was subjected to general, special, incidental and consequential damages in the sum not yet determined but to be proven at trial.
¶15 The City points out: “MK
Investments neither alleges an unconstitutional policy, nor does it allege a
constitutional policy that has resulted in a widespread practice of
unconstitutional taking of property without due process of law against MK
Investments and others.”[3] We agree.
Additionally, MK Investments’ counterclaim is devoid of any reference to
either the issue of service of raze orders or the placarding of buildings by
the City, upon which its 42 U.S.C. § 1983 claim is apparently based, as
evidenced by its appellate briefing.[4] The only allegation setting forth potentially
relevant facts is in the third paragraph of the counterclaim, where MK
Investments alleges the City “authorize[ed] the entering onto the M[K]
Investments, LLC’s real property and removing the building thereon on or about
January 3, 2007.” The allegation
containing these facts, however, amounts to little more than “[b]are legal
conclusions attached to narrated facts.” See Wilson, 157
¶16 We conclude that the allegations of the counterclaim are
insufficient to state a claim for relief under 42 U.S.C. § 1983. The nature and bases of MK Investments’
§ 1983 claim are wholly unclear and insufficient to notify the City of
By the Court.—Judgment affirmed.
Not recommended for publication in the official reports.
[1] Title 42 U.S.C. § 1983 provides in relevant part:
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.
[2] All references to the Wisconsin Statutes are to the 2005-06 version unless otherwise noted.
MK Investments argues: “The document which was allegedly served on Appellants was not a Raze Order. It was titled ‘Inspection Report and Order to Correct Condition’ and it gave Appellants 60 days to repair the property or in the alternative raze the building.” For resolution of this appeal, it is irrelevant whether we reference the order as a raze order or as an order to correct condition.
[3] It is not clear whether MK Investments is alleging a violation of its substantive or procedural due process rights. See Thorp v. Town of Lebanon, 2000 WI 60, ¶¶45, 53, 235 Wis. 2d 610, 612 N.W.2d 59 (“Substantive due process forbids a government from exercising ‘power without any reasonable justification in the service of a legitimate governmental objective.’ … The procedural due process clause protects individuals from governmental ‘denial of fundamental procedural fairness.’” (citations omitted)).
[4] We
note that even if service of the raze order was improper, an issue we do not
decide, we fail to see how it resulted in any violation of MK Investments’
federally protected rights. Particularly
where, as the City points out, “MK Investments does not argue that it did not
receive notice, it argues that the person who served the Order was an employee
of the City[;] therefore the service was not valid.” MK Investments failed to develop an argument
that any federal constitutional right was violated as a result of service of
the raze by a City employee, and, had we addressed this issue in greater
detail, we would have refrained from crafting an argument for it. See State v. Pettit, 171
Furthermore, with respect to the placarding of buildings by the City, even accepting MK Investments’ assertions at face value, we cannot conclude that a wrongful taking occurred. MK Investments argues that it was prevented from effectuating the requisite repairs due to a placard, which stated:
NOTICE
An order to raze and remove has been issued pursuant to section 66.0413 of the Wisconsin Statutes, and Section 218-4, Milwaukee Code of Ordinances, requiring the razing and removal of this building. Therefore, effective immediately, this structure cannot be used for human inhabitation, occupancy or use…. Any person occupying or using these premises … is subject to arrest.
(Formatting and bolding as it appears in original.)
Although both
parties included copies of the notice in the appendices attached to their
briefs, neither provides a correlating record citation, in violation of Wis. Stat. § 809.19(2)(a) and
contrary to counsels’ own certifications.
See State v. Bons, 2007 WI App 124, ¶¶22-25, 301
[5] The
City also seeks dismissal of MK Investments’ appeal on grounds that it is
untimely and because MK Investments improperly served the City with a notice of
appeal. However, because we have decided
the appeal in the City’s favor, we need not address these other issues raised
by the City. See Gross v. Hoffman,
227