Title: Lands' End, Inc. v. City of Dodgeville
Citation: N/A
Docket Number: 2015AP000179
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: July 12, 2016

2016 WI 64 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2015AP179 
COMPLETE TITLE: 
Lands' End, Inc., 
          Plaintiff-Appellant, 
     v. 
City of Dodgeville, 
          Defendant-Respondent. 
 
 
 
 
ON BYPASS FROM THE COURT OF APPEALS 
 
 
OPINION FILED: 
July 12, 2016 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
March 16, 2016 
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit 
 
COUNTY: 
Iowa 
 
JUDGE: 
Craig R. Day 
 
 
 
JUSTICES: 
 
 
CONCURRED: 
ZIEGLER, J. concurs (Opinion filed). 
 
DISSENTED: 
PROSSER, J. and ROGGENSACK, C. J. dissent 
(Opinion filed). 
 
NOT PARTICIPATING: BRADLEY, R. G., J. did not participate.    
 
 
 
ATTORNEYS: 
 
For the plaintiff-appellant, there were briefs by Robert E. 
Shumaker, Michele Perreault, and DeWitt Ross & Stevens S.C., 
Madison, and oral argument by Robert E. Shumaker. 
 
 
For the defendant-respondent, there was a brief by Ted 
Waskowski, Amie B. Trupke, and Stafford Rosenbaum LLP, and oral 
argument by Amie B. Trupke. 
 
 
 
 
 
 
2016 WI 64
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2015AP179 
(L.C. No. 
2009CV108) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Lands' End, Inc., 
 
          Plaintiff-Appellant, 
 
     v. 
 
City of Dodgeville, 
 
          Defendant-Respondent. 
 
 
 
FILED 
 
JUL 12, 2016 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
APPEAL from a judgment and order of the Circuit Court for 
Iowa County, Craig R. Day, Judge.  Affirmed   
 
¶1 
SHIRLEY S. ABRAHAMSON, J.   This is an appeal from a 
judgment and an order of the circuit court for Iowa County, 
Craig R. Day, Judge.  This judgment and order arose in response 
to the 2013 directions of the court of appeals to the circuit 
court to enter judgment in favor of Lands' End, Inc., the 
plaintiff, and against the City of Dodgeville, the defendant, 
No. 
2015AP179   
 
2 
 
for $724,292.68 "plus statutory interest and other interest or 
costs to which Lands' End may be entitled."1   
¶2 
The issue before this court is what is the correct 
rate of statutory interest to apply to Lands' End's judgment 
against the City.  More specifically, the issue is whether a 
party is entitled to interest at the statutory rate of interest 
in effect when an offer of settlement was made under Wis. Stat. 
§ 807.01(4) (2009-10) or at the statutory rate of interest in 
effect when the party recovers a judgment under the amended 
version of the statute, Wis. Stat. § 807.01(4) (2013-14).2     
¶3 
We affirm the circuit court's judgment and order.  The 
circuit court awarded Lands' End interest at the statutory rate 
of interest in effect when Lands' End recovered a judgment, 
namely at a rate of "1 percent plus the prime rate" under the 
amended version of Wis. Stat. § 807.01(4) (2013-14).   
¶4 
Lands' End appealed from the circuit court's order and 
judgment, arguing that the circuit court's application of the 
                                                 
1 Lands' End, Inc. v. City of Dodgeville, No. 2010AP1185, 
unpublished slip op., ¶30 (Wis. Ct. App. Sept. 12, 2013).   
2 The amended version of Wis. Stat. § 807.01(4) (2013-14) 
was adopted by 2011 Wis. Act 69.  The phrase "party recovers a 
judgment" in Wis. Stat. § 807.01(4) is not defined.  The meaning 
of the phrase is not pertinent to the issue before the court.  
Important for the instant case is that the parties do not 
dispute that Lands' End recovered a favorable judgment against 
the City only after the enactment of the amended version of Wis. 
Stat. § 807.01(4) (2013-14) lowered the statutory rate of 
interest recoverable when a party makes an offer of settlement 
and later recovers a judgment for greater than or equal to the 
amount of the offer.  
No. 
2015AP179   
 
3 
 
amended version of the statute, Wis. Stat. § 807.01(4) (2013-
14), was retroactive, disturbed Lands' End's vested rights in 
the 12 percent interest rate in effect in Wis. Stat. § 807.01(4) 
(2009-10) at the time it made its offer of settlement, and 
violated Wis. Stat. § 990.04 (2013-14) and the Due Process and 
Equal Protection clauses of the federal and state constitutions.   
¶5 
For the reasons set forth, we affirm the circuit 
court's judgment and order awarding Lands' End interest at "1 
percent plus the prime rate,"3 the rate in the amended version of 
the statute, Wis. Stat. § 807.01(4) (2013-14), which was in 
effect when Lands' End recovered its judgment against the City 
of Dodgeville.4   
¶6 
Awarding interest at "1 percent plus the prime rate" 
in the instant case is not a retroactive application of Wis. 
Stat. § 807.01(4) (2013-14) and Lands' End did not have a vested 
right in the 12 percent interest rate in effect in Wis. Stat. 
§ 807.01(4) (2009-10) at the time Lands' End made its offer of 
                                                 
3 The prime rate is "the rate banks charge for short-term 
unsecured loans to creditworthy customers."  Matter of Oil Spill 
by Amoco Cadiz Off Coast of France on Mar. 16, 1978, 954 
F.2d 1279, 1332 (7th Cir. 1992).  Because the prime rate 
reflects market conditions, the prime rate provides a basis to 
assess the time value of money withheld from a litigant for the 
duration elapsed between the rejected offer of settlement and 
eventual payment.  See generally Michael S. Knoll, A Primer on 
Prejudgment Interest, 75 Tex. L. Rev. 293 (1996). 
4 We sometimes refer to Wis. Stat. § 807.01(4) (2013-14) as 
the "amended version" of the statute, and refer to Wis. Stat. 
§ 807.01(4) (2009-10) as the "prior version" of the statute or 
the statute in effect on the date of the offer of settlement. 
No. 
2015AP179   
 
4 
 
settlement.  The circuit court's judgment and order do not 
violate the Due Process clauses of the federal and state 
constitutions or Wis. Stat. § 990.04 (2013-14).  Moreover, 
because the legislature had a rational basis for changing the 
applicable interest rate from 12 percent to "1 percent plus the 
prime rate" and did not create an irrational or arbitrary 
classification, awarding interest under the amended version of 
the statute, Wis. Stat. § 807.01(4) (2013-14), does not violate 
the 
Equal 
Protection 
clauses 
of 
the 
federal 
and 
state 
Constitutions.   
¶7 
Our decision in the instant case is contrary to the 
opinion of the court of appeals in Johnson v. Cintas Corp. No. 
2, 2015 WI App 14, 360 Wis. 2d 350, 860 N.W.2d 515.5  In Johnson, 
the court of appeals held that applying the amended version of 
the rate of interest to offers of settlement made prior to the 
effective date of the amended version would disturb a vested 
right to interest.  Johnson is an officially published opinion 
of the court of appeals.  "Officially published opinions of the 
court of appeals shall have statewide precedential effect."  
Wis. Stat. § 752.41(2) (2013-14).  We overrule the Johnson 
decision. 
                                                 
5 This court granted review in Johnson v. Cintas Corp. No. 
2, 2015 WI App 14, 360 Wis. 2d 350, 860 N.W.2d 515, to address 
the same basic issues we address in the instant case.  Before 
Johnson was fully briefed, the parties voluntarily dismissed the 
appeal with the permission of the court.  See Wis. Stat. 
§ (Rule) 809.18; see also Wis. S. Ct. Internal Operating 
Procedures II.L.4 (reprinted in Vol. 6, Wis. Stats.).   
No. 
2015AP179   
 
5 
 
¶8 
Accordingly, we affirm the judgment and order of the 
circuit court in the instant case. 
I 
 
¶9 
The facts and procedural history of the instant case 
are not in dispute for the purposes of this appeal.   
¶10 The instant case is one of several cases representing 
nearly a decade of litigation between Lands' End and the City 
challenging the City's appraisal of the fair market value (and 
resulting 
property 
tax 
assessments) 
of 
Lands' 
End's 
headquarters.  We do not recite the entire procedural history of 
the litigation between Lands' End and the City.  Instead, we 
refer to pertinent aspects of the procedural history.     
 
¶11 Lands' 
End 
is 
a 
Delaware 
corporation 
with  
headquarters in the City of Dodgeville, Wisconsin, occupying six 
parcels of land.  For ease of discussion, we will refer to these 
six parcels collectively as Lands' End's headquarters.     
¶12 Prior to the instant case, in a case concerning the 
amount of property taxes assessed for 2005 and 2006, the circuit 
court for Iowa County, Edward Leineweber, Judge, ruled in Lands' 
End's favor, rejecting the City of Dodgeville's valuation 
methodology and concluding that the fair market value of Lands' 
End's headquarters was $25,000,000.  
 
¶13 In the instant case, Lands' End challenged the 2008 
property tax assessment on its headquarters and sought a refund 
of taxes.  Lands' End argued that the City erroneously based its 
2008 property tax assessment on the same valuation methodology 
rejected in the 2005 and 2006 tax assessment case.  
No. 
2015AP179   
 
6 
 
¶14 On July 1, 2009, Lands' End made an offer of 
settlement in the instant case under Wis. Stat. § 807.01(4) 
(2009-10) for $724,000.  The City rejected Lands' End's offer.   
¶15 Lands' End subsequently moved for summary judgment, 
arguing that issue preclusion, together with the undisputed fact 
that the value of Lands' End's headquarters did not change 
between 2006 and 2008, entitled it to judgment as a matter of 
law.  On April 19, 2010, the circuit court for Iowa County, 
William Dyke, Judge, denied Lands' End's motion for summary 
judgment and affirmed the City's valuation of Lands' End's 
headquarters.   
¶16 Lands' End appealed the circuit court's denial of 
summary judgment.  The court of appeals reversed the circuit 
court, holding that the circuit court erroneously denied Lands' 
End's motion for summary judgment.  The court of appeals 
remanded the matter to the circuit court "with directions to 
enter judgment in favor of Lands' End in the amount of 
$724,292.68, plus statutory interest and any other interest or 
costs to which Lands' End may be entitled."6   
¶17 On 
remand, 
the 
parties 
disagreed 
regarding 
the 
applicable rate of statutory interest to which Lands' End was 
entitled.  Lands' End moved for entry of judgment, arguing that 
it was entitled to interest at the 12 percent rate specified in 
Wis. Stat. § 807.01(4) (2009-10); this version of § 807.01(4) 
                                                 
6 Lands' End, Inc. v. City of Dodgeville, No. 2010AP1185, 
unpublished slip op., ¶30 (Wis. Ct. App. Sept. 12, 2013).     
No. 
2015AP179   
 
7 
 
was in effect when Lands' End made its offer of settlement.  In 
contrast, the City argued that Lands' End was entitled to 
interest at "1 percent plus the prime rate" as specified in the 
amended version of Wis. Stat. § 807.01(4) (2013-14); this 
version of § 807.01(4) was in effect when Lands' End recovered a 
judgment. 
¶18 The circuit court agreed with the City, awarding 
interest at "1 percent plus the prime rate" as specified in the 
amended version of Wis. Stat. § 807.01(4) (2013-14).  The 
circuit court concluded that "1 percent plus the prime rate" 
was, at the relevant time, 4.25 percent, a rate substantially 
less than the 12 percent interest provided for in Wis. Stat. 
§ 807.01(4) (2009-10).  Lands' End appealed.  We granted the 
City's petition to bypass the court of appeals.  See Wis. Stat. 
§ (Rule) 809.60.   
II 
 
¶19 The instant case involves the interpretation of 
statutes and constitutional provisions and their application to 
undisputed facts.  These are questions of law that we decide 
independently of the circuit court and the court of appeals 
while benefitting from their analyses.  Milwaukee Journal 
Sentinel v. Wis. Dep't of Admin., 2009 WI 79, ¶14, 319 
Wis. 2d 439, 768 N.W.2d 700.  
 
¶20 Lands' End challenges the constitutionality of Wis. 
Stat. § 807.01(4) (2013-14) as applied to it.  Lands' End has 
the burden of proving beyond a reasonable doubt that Wis. Stat. 
No. 
2015AP179   
 
8 
 
§ 807.01(4) is unconstitutional as applied to it.  See Soc'y 
Ins. v. LIRC, 2010 WI 68, ¶27, 326 Wis. 2d 444, 786 N.W.2d 385.   
III 
 
¶21 We first examine the texts of the statutes governing 
offers of settlement and the rate of interest to which a party 
is entitled if the party making the offer of settlement 
subsequently recovers a judgment for greater than or equal to 
the amount of the offer.  We then turn to the court of appeals' 
decision in Johnson before addressing Lands' End's five legal 
arguments in support of its position.    
¶22 Wisconsin 
Stat. 
§ 807.01, 
entitled 
"Settlement 
offers," provides that if a party makes an offer of settlement 
and subsequently recovers a judgment for greater than or equal 
to the amount of its offer, the offeror is "entitled" to 
interest on the amount recovered running from the date of its 
offer.  See Wis. Stat. § 807.01(4) (2009-10) and Wis. Stat. 
§ 807.01(4) (2013-14) for two versions of this statute.   
 
¶23 The two versions of the statutes set forth two 
different rates of statutory interest.  The dispute is about 
which version of the statute (and thus which rate of statutory 
interest) applies in the instant case. 
¶24 Prior to 2011, Wis. Stat. § 807.01(4) (2009-10) 
provided that the party making an offer of settlement may be 
entitled to interest at the annual rate of 12 percent on the 
amount recovered from the date of the offer of settlement until 
the amount is paid. 
No. 
2015AP179   
 
9 
 
¶25 Section 807.01(4) (2009-10) stated in relevant part as 
follows (with emphasis added):  
If there is an offer of settlement by a party under 
this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at the annual rate of 
12% on the amount recovered from the date of the offer 
of settlement until the amount is paid. . . .   
 
¶26 In 2011 the legislature adopted 2011 Wis. Act 69, 
amending the statute.  Act 69 amended Wis. Stat. § 807.01(4) 
(2009-10) to provide that the party making an offer of 
settlement is entitled to interest at an annual rate equal to 1 
percent plus the applicable prime rate in effect on January 1 of 
the year in which the judgment is entered if the judgment is 
entered on or before June 30 of that year, or in effect on July 
1 of the year in which the judgment is entered if the judgment 
is entered after June 30 of that year. 
¶27 Section 807.01(4) (2013-14) states in relevant part as 
follows (with emphasis added):  
If there is an offer of settlement by a party under 
this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at an annual rate equal 
to 1 percent plus the prime rate in effect on January 
1 of the year in which the judgment is entered if the 
judgment is entered on or before June 30 of that year 
or in effect on July 1 of the year in which the 
judgment is entered if the judgment is entered after 
June 30 of that year, as reported by the federal 
reserve board in federal reserve statistical release 
H. 15, on the amount recovered from the date of the 
offer of settlement until the amount is paid. . . . 
No. 
2015AP179   
 
10 
 
¶28 Both versions of Wis. Stat. § 807.01(4) impose the 
same three basic requirements in order for a party who makes an 
offer of settlement to be entitled to interest on a judgment 
recovered: (1) an (unaccepted) offer of settlement; (2) recovery 
of a judgment; and (3) a judgment for greater than or equal to 
the amount of the offer.  "[I]nterest may not be imposed unless 
an actual judgement is entered in a case."  DeWitt Ross & 
Stevens v. Galaxy Gaming & Racing Ltd. P'ship, 2004 WI 92, ¶33, 
273 Wis. 2d 577, 682 N.W.2d 839 (citing Osman v. Phipps, 2002 WI 
App 170, ¶¶8, 12, 256 Wis. 2d 589, 649 N.W.2d 701) (declining to 
award interest when no judgment was recovered)); see also Tomsen 
v. Secura Ins., 2003 WI App 187, ¶10, 266 Wis. 2d 491, 668 
N.W.2d 794 (awarding interest because a judgment was recovered 
based on a stipulation). 
 
¶29 In the instant case, it is undisputed that Lands' End 
meets these three requirements and is therefore entitled to 
interest on its judgment.  The question remains, however, what 
statutory rate of interest applies in the instant case.   
 
¶30 To support its position that the applicable rate of 
interest is set forth in the earlier version of Wis. Stat. 
§ 807.01(4) (2009-10), Lands End relies on the court of appeals' 
decision in Johnson v. Cintas Corp. No. 2, 2015 WI App 14, 360 
Wis. 2d 350, 860 N.W.2d 515.  
¶31 Johnson decided the same issue that is presented in 
the instant case.  The Johnson decision did not, however, 
address all the legal arguments presented in the instant case.    
No. 
2015AP179   
 
11 
 
¶32 In Johnson, the plaintiff, Johnson, made an offer of 
settlement in 2008.7  After the offer of settlement was made but 
before Johnson recovered a judgment, the legislature enacted 
2011 Wis. Act 69.8  In 2013, after 2011 Wis. Act 69 took effect, 
Johnson recovered more than the amount of his offer of 
settlement.9  Johnson sought interest on the judgment from the 
time the offer of settlement at 12 percent annually from the 
date of the offer of settlement pursuant to Wis. Stat. 
§ 807.01(4) (2007-08).10   
¶33 The circuit court in Johnson applied the interest rate 
in effect when Johnson recovered his judgment——"1 percent plus 
the prime rate"——rather than the 12 percent rate in effect at 
the time of Johnson's offer of settlement.11  
¶34 The court of appeals reversed the circuit court in 
Johnson, reasoning that awarding interest at "1 percent plus the 
prime rate" when a party made an offer of settlement under the 
prior 12 percent interest rate would be unconstitutional.12  The 
court of appeals concluded that the interest rate to be applied 
                                                 
7 Johnson, 360 Wis. 2d 350, ¶5.   
8 Johnson, 360 Wis. 2d 350, ¶17.   
9 Johnson, 360 Wis. 2d 350, ¶10.   
10 Johnson, 360 Wis. 2d 350, ¶2.   
11 Johnson, 360 Wis. 2d 350, ¶11.   
12 Johnson, 360 Wis. 2d 350, ¶29.   
No. 
2015AP179   
 
12 
 
is the rate in effect on the date of the offer of settlement.13  
The court of appeals stated that applying a statutory interest 
rate enacted after the offer of settlement adversely affects the 
expectations of both parties and "would substantially impair 
Johnson's vested right to interest on the judgment at twelve 
percent."14  
 
¶35 For the reasons set forth, we disagree with the court 
of appeals' decision in Johnson and are not persuaded by Lands' 
End's legal arguments.   
¶36 Lands' End's arguments are as follows:  
(1) Applying the amended version of Wis. Stat. § 807.01(4) 
(2013-14), which fixes the statutory rate of interest 
at "1 percent plus the prime rate," to Lands' End's 
judgment 
in 
the 
instant 
case 
is 
a 
retroactive 
application of the statute;  
                                                 
13 Johnson, 360 Wis. 2d 350, ¶29.   
14 See Johnson, 360 Wis. 2d 350, ¶¶25-29.   
We note, however, that the court of appeals in Johnson 
misstated the balancing test, stating that "[i]f retroactive 
legislation causes 'substantial impairment of a vested right,' 
it is unconstitutional unless justified by a significant and 
legitimate public interest."  See Johnson, 360 Wis. 2d 350, ¶15 
(quoting Matthies v. Positive Safety Mfg. Co., 2001 WI 82, ¶31, 
244 Wis. 2d 720, 628 N.W.2d 842).  In Society Insurance v. Labor 
& Industry Review Commission, 2010 WI 68, ¶30 n.12, 326 
Wis. 2d 444, 786 N.W.2d 385, we held that "requiring a showing 
of a 'significant and legitimate public purpose' in the course 
of a due process challenge improperly subjects the retroactive 
legislation to a heightened level of scrutiny.  Retroactive 
legislation must be 'justified by a rational legislative 
purpose.'"   
No. 
2015AP179   
 
13 
 
(2) Lands' End had a vested right in the 12 percent 
statutory interest rate in the version of Wis. Stat. 
§ 807.01(4) (2009-10) in effect when Lands' End made 
its offer of settlement;  
(3) Applying 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14), 
which 
provides for interest at "1 percent plus the prime 
rate," to Lands' End's judgment in the instant case 
violates the Due Process clauses of the federal and 
state constitutions; 
(4) Applying 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14), 
which 
provides for interest at "1 percent plus the prime 
rate," to Lands' End's judgment in the instant case 
violates Wis. Stat. § 990.04; and 
(5) Applying 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14), 
which 
provides for interest at "1 percent plus the prime 
rate," to Lands' End's judgment in the instant case 
violates the Equal Protection clauses of the federal 
and state constitutions. 
¶37 Although we address each of these legal arguments 
separately, they are interrelated, not isolated.  Lands' End 
relies on the same or similar approaches in each argument to 
buttress its position.   
(1) 
¶38 Applying the "1 percent plus the prime rate" language 
in effect when Lands' End recovered its judgment was not a 
retroactive application of the amended version of Wis. Stat. 
§ 807.01(4) (2013-14) to Lands' End's judgment, because Lands' 
No. 
2015AP179   
 
14 
 
End had not recovered a judgment before the amended version of 
the statute took effect.   
¶39 Deciding when a statute applies retroactively is not 
always easy; it is not a mechanical task.  "The conclusion that 
a particular rule operates 'retroactively' comes at the end of a 
process of judgment concerning the nature and extent of the 
change in the law and the degree of connection between the 
operation of the new rule and a relevant past event."  Landgraf 
v. USI Film Prods., 511 U.S. 244, 265 (1994).   
¶40 To put into perspective the issue of whether the 
amended 
version 
of 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
is 
retroactive legislation, we state and apply principles of the 
law of retroactivity.       
¶41 First, 
the 
party 
challenging 
legislation 
as 
unconstitutionally retroactive "has the burden of proving the 
statute, as applied to it, is unconstitutional beyond a 
reasonable doubt."  Soc'y Ins. v. LIRC, 2010 WI 68, ¶27, 326 
Wis. 2d 444, 786 N.W.2d 385.  The burden is thus on Lands' End 
in the instant case.    
 
¶42 Second, "[t]he general rule in Wisconsin is that 
legislation is presumptively prospective unless the statutory 
language clearly reveals either expressly or by necessary 
implication an intent that the statute apply retroactively."  
Betthauser v. Med. Protective Co., 172 Wis. 2d 141, 147, 493 
No. 
2015AP179   
 
15 
 
N.W.2d 40 (1992) (quoting U.S. Fire Ins. Co. v. E.D. Wesley Co., 
105 Wis. 2d 305, 319, 313 N.W.2d 833 (1982)).15   
¶43 The amended version of Wis. Stat. § 807.01(4) (2013-
14) does not clearly reveal a legislative intent that the 
statute apply retroactively.  See 2011 Wis. Act 69 (adopting 
Wis. Stat. § 807.01(4) (2013-14)).   
¶44 In contrast, when the 12 percent rate in Wis. Stat. 
§ 807.01(4) (2009-10) first became effective in 1980, the 
legislature clearly specified that the statute did not apply 
retroactively: 
"The 
treatment 
or 
creation 
of 
sections 
807.01(4) . . . of the statutes apply only to actions commenced 
on or after the effective date of this Act."  § 5, ch. 271, Laws 
of 1979.   
¶45 When the legislature adopted 2011 Wis. Act 69 reducing 
the rate of interest to "1 percent plus the prime rate," the 
legislature did not use similar limiting language.  Rather, the 
                                                 
15 "If, however, a statute is procedural or remedial, rather 
than substantive, the statute is generally given retroactive 
application 
unless 
retroactive 
application 
would 
impair 
contracts or disturb vested rights."  Betthauser v. Med. 
Protective Co., 172 Wis. 2d 141, 147, 493 N.W.2d 40 (1992) 
(citing Steffen v. Little, 2 Wis. 2d 350, 357-58, 86 N.W.2d 622 
(1957)).  Because we conclude that awarding interest at the "1 
percent plus the prime rate" in effect when Lands' End recovered 
its judgment is not a retroactive application of Wis. Stat. 
§ 807.01(4) and does not impair any vested rights, we need not 
decide 
whether 
Wis. 
Stat. 
§ 807.01(4) 
is 
substantive 
or 
procedural.  Even if interest under Wis. Stat. § 807.01(4) is, 
as Lands' End argues, substantive rather than procedural, the 
statute is not being applied retroactively and does not disturb 
vested rights. 
No. 
2015AP179   
 
16 
 
legislature stated that 2011 Wis. Act 69 "first applies to an 
execution on a judgment entered on the effective date of this 
subsection."  2011 Wis. Act 69, § 4.  The parties do not dispute 
that Lands' End did not "execut[e] on judgment" prior to the 
effective date of 2011 Wis. Act 69.     
¶46 We conclude that the amended version of Wis. Stat. 
§ 807.01(4) (2013-14) does not clearly reveal a legislative 
intent that the statute apply retroactively.  Further analysis 
is required to determine whether Wis. Stat. § 807.01(4) (2013-
14) applies retroactively in the instant case.   
¶47 Third, another principle guiding the determination of 
retroactivity in the present case is that a statute does not 
operate retroactively simply because it is applied "in a case 
arising from conduct antedating the statute's enactment, or 
upsets expectations based on prior law."  State v. Chrysler 
Outboard Corp., 219 Wis. 2d 130, 172, 580 N.W.2d 203 (1998) 
(quoting Landgraf, 511 U.S. at 269-70).16   
                                                 
16 See also Republic Nat'l Bank v. United States, 506 U.S. 
80, 100 (1992) (Thomas, J., concurring in part and concurring in 
judgment) ("[N]ot every application of a new statute to a 
pending case will produce a 'retroactive effect.'"); Cox v. 
Hart, 260 U.S. 427, 435 (1922) ("A statute is not made 
retroactive merely because it draws upon antecedent facts for 
its operation.") (citations omitted); 2 Norman J. Singer & J.D. 
Shambie Singer, Statutes and Statutory Construction § 41:1, at 
385 (7th ed. 2009) ("[A] statute is not rendered retroactive 
merely because the facts upon which its subsequent action 
depends are drawn from a time antecedent to its effective 
date.") 
No. 
2015AP179   
 
17 
 
¶48 Thus the fact that the amended version of Wis. Stat. 
§ 807.01(4) (2013-14) applies to Lands' End's pending instant 
case, standing alone, does not render the statute retroactive.   
¶49 Fourth, a statute operates retroactively if, among 
other things, it "takes away or impairs vested rights . . . ."  
Chrysler Outboard, 219 Wis. 2d at 172 (quoting In re Estate of 
Bilsie, 100 Wis. 2d 342, 357, 302 N.W.2d 508 (Ct. App. 1981)).  
But "[t]he mere expectation of a future benefit or contingent 
interest does not create a vested right."  2 Norman J. Singer & 
J.D. Shambie Singer, Statutes and Statutory Construction § 41:6, 
at 456-57 (7th ed. 2009) (emphasis added).17   
¶50 Thus, when the existence of a right is contingent on 
an uncertain future event (here, recovering a judgment), and 
that event has not occurred prior to the enactment of a statute 
altering the legal effect of that uncertain future event, the 
party challenging the application of the revised statute has no 
                                                 
17 Cases in other jurisdictions agree that a party does not 
have a vested right when the existence of the right asserted is 
contingent on some uncertain future event.  See, e.g., U.S. Cold 
Storage v. City of La Vista, 831 N.W.2d 23, 33 (Neb. 2013) ("To 
be considered a vested right, the right must be 'fixed, settled, 
absolute, and not contingent upon anything.'") (quoted source 
omitted) (emphasis added); Rehor v. Case W. Reserve Univ., 331 
N.E.2d 416, 420 (Ohio 1975) ("'[A] vested right is a right 
fixed, settled, absolute, and not contingent upon anything.'")  
(emphasis added); Wylie v. Grand Rapids City Comm'n, 292 N.W. 
668, 674 (Mich. 1940) ("'A vested right . . . is a right so 
fixed, that it is not dependent on any act, contingency, or 
decision to make it more secure.") (emphasis added).   
No. 
2015AP179   
 
18 
 
vested right in the application of the prior law, and the new 
law is not being retroactively applied.  
¶51 The explanation of this point in Winiarski v. Miicke, 
186 Wis. 2d 409, 521 N.W.2d 162 (Ct. App. 1994), is instructive. 
¶52 In 
Winiarski, 
a 
child 
was 
adopted 
by 
his 
grandparents.18  At the time of the adoption, an adopted child 
could inherit from his or her birth parent through intestate 
succession.19  After the adoption but before the child's 
biological father died, a new statute was enacted declaring 
(with exceptions not relevant here) that an adopted child could 
not inherit from his or her birth parent through intestate 
succession.20  Subsequently, the child's biological father died 
intestate, and the child sought to take from his biological 
father's estate, arguing that the new statute was prospective 
only and did not apply to his situation.21   
¶53 The court of appeals held in Winiarski against the 
child as follows:  
[T]he right to take by intestate succession does not 
exist until the decedent dies intestate.  Thus, 
intestate succession is governed by statutes 'in force 
at 
the 
time 
of 
the 
death 
of 
the 
intestate.' 
Accordingly, a statute enacted after an adoption that 
alters the effect of the adoption on the right to 
                                                 
18 In the Matter of the Estate of Winiarski v. Miicke, 
186 Wis. 2d 409, 412, 521 N.W.2d 162 (Ct. App. 1994).   
19 See Winiarski, 186 Wis. 2d at 411.   
20 See Winiarski, 186 Wis. 2d at 411.   
21 Winiarski, 186 Wis. 2d at 411-12.   
No. 
2015AP179   
 
19 
 
inherit from a[n] intestate decedent is prospective, 
not retroactive, as long as the statute was effective 
before the intestate's death.22  
¶54 In the instant case, like Winiarski, Lands' End's 
right at the time the amended version of the statute took effect 
was contingent on an uncertain future event, namely Lands' End's 
recovery of a judgment for greater than or equal to the amount 
of its offer of settlement.  Thus, as in Winiarski, the amended 
version of the statute is not retroactive, because Lands' End's 
right under the amended version of the statute at the effective 
date of the statute was inchoate, not perfected, not ripened, 
nor accrued.  Lands' End had not yet recovered a judgment. 
¶55 Fifth, 
although 
not 
dispositive, 
the 
presumption 
against retroactive application of a statute is premised on 
considerations of fairness.23  Persons should have an opportunity 
                                                 
22 Winiarski, 186 Wis. 2d at 412-13 (internal citations 
omitted) (emphasis in original).   
23 See Landgraf v. USI Film Prods., 511 U.S. 244, 265 (1994) 
("As Justice Scalia has demonstrated, the presumption against 
retroactive legislation is deeply rooted in our jurisprudence, 
and embodies a legal doctrine centuries older than our Republic.  
Elementary considerations of fairness dictate that individuals 
should have an opportunity to know what the law is and to 
conform their conduct accordingly; settled expectations should 
not be lightly disrupted.  For that reason, the 'principle that 
the legal effect of conduct should ordinarily be assessed under 
the law that existed when the conduct took place has timeless 
and universal appeal.'") (quoting Kaiser Aluminum & Chem. Corp. 
v. Bonjorno, 494 U.S. 827, 855 (1990) (Scalia, J., concurring)). 
See also 2 Singer, supra note 16, § 41:6, at 457 ("Judicial 
attempts to explain whether [the] protection against retroactive 
interference [with vested rights] will be extended reveal that 
elementary considerations of fairness and justice govern."). 
No. 
2015AP179   
 
20 
 
to know in advance what the law is and to conform their conduct 
accordingly.24  Furthermore, settled expectations should not be 
lightly disrupted.25  
¶56 Although Lands' End argues that it had a settled 
expectation of 12 percent interest based on its offer of 
judgment, 
which 
antedated 
the 
enactment 
of 
Wis. 
Stat. 
§ 807.01(4) (2013-14), that expectation does not necessarily 
render Wis. Stat. § 807.01(4) (2013-14) retroactive or make its 
application to Lands' End in the instant case unfair.  "If every 
time a man relied on existing law in arranging his affairs, he 
were made secure against any change in legal rules, the whole 
body of our law would be ossified forever."  Lon L. Fuller, The 
Morality of Law 60 (1964).  
¶57 Moreover, it is questionable whether an expectation 
based on the prior law was reasonable.  To obtain interest at 
the former 12 percent statutory interest rate, Lands' End had to 
recover a judgment for as much or more than the amount of its 
offer of settlement.  The statute and the case law explicitly 
say so.26  Lands' End had not recovered a judgment when the 
                                                 
24 See Landgraf, 511 U.S. at 265. 
25 See Landgraf, 511 U.S. at 265. 
26 See DeWitt Ross & Stevens v. Galaxy Gaming & Racing Ltd. 
P'ship, 2004 WI 92, ¶33, 273 Wis. 2d 577, 682 N.W.2d 839 (citing 
Osman v. Phipps, 2002 WI App 170, ¶¶8, 12, 256 Wis. 2d 589, 649 
N.W.2d 701) ("[I]nterest may not be imposed unless an actual 
judgment is entered in a case."); see also Tomsen v. Secura 
Ins., 2003 WI App 187, ¶10, 266 Wis. 2d 491, 668 N.W.2d 794 
(interest awarded because judgment was recovered based on a 
stipulation). 
No. 
2015AP179   
 
21 
 
former 12 percent statutory interest rate was repealed, and the 
possibility remained that it would not recover a judgment at all 
or would recover a judgment for less than the offer of 
settlement.  Thus, Lands' End's claim that it expected to be 
governed by the former statute rests on shaky ground.   
¶58 Furthermore, it is not an unreasonable burden on 
Lands' End or unjust or impractical to apply the amended version 
of the statutory rate of interest to Lands' End's judgment in 
the instant case.  When the 12 percent interest rate became 
effective in 1980, 12 percent was lower than the predominant 
market interest rate.27  In 2009, however, when Lands' End made 
its offer of settlement, market interest rates were 3.25 
percent——considerably lower than when the 12 percent statutory 
interest rate in Wis. Stat. § 807.01(4) (2009-10) went into 
effect in 1980.   
¶59 The interest rate in Wis. Stat. § 807.01(4) is 
apparently designed to place parties in roughly the same 
position they would have been had the amount of the judgment 
                                                 
27 See Bd. of Governors of the Fed. Reserve Sys., Bank Prime 
Loan Rate Changes: Historical Dates of Changes and Rates (Dec. 
21, 
2014, 
12:41 
PM),  
https://research.stlouisfed.org/fred2/data/PRIME.txt 
(stating 
prime rates in 1980 fluctuated between 11 percent and 21 
percent). 
No. 
2015AP179   
 
22 
 
recovered been paid immediately.28  When we consider the market 
interest rate during the entire period of the instant case, the 
interest rate in the amended version of the statute compensated 
Lands' End for approximately the same amount had the amount of 
the judgment recovered been paid immediately.  
¶60 By tying the interest rate in Wis. Stat. § 807.01(4) 
(2013-14) to market rates, the legislature ensured that a party 
like Lands' End that recovers a judgment for as much or more 
than the amount of an offer of settlement after the effective 
date of the statute is fairly and reasonably compensated for 
being unable, during the pendency of the litigation, to use the 
money to which it is entitled. 
¶61 Elsewhere, Lands' End argues that it would be unfair 
to award it interest at "1 percent plus the prime rate" because, 
but for the circuit court's erroneous denial of summary 
judgment, Lands' End would have recovered a judgment prior to 
the effective date of 2011 Wis. Act 69, and thus would have been 
entitled to interest at 12 percent rather than "1 percent plus 
the prime rate."   
¶62 We disagree with Lands' End when it argues that it is 
unfair to award interest at the lower interest rate when its 
                                                 
28 See Michael S. Knoll, A Primer on Prejudgment Interest, 
75 Tex. L. Rev. 293, 296 (1996) ("The payment of prejudgment 
interest . . . ensures 
that 
the 
plaintiff 
receives 
full 
compensation for its losses and that the defendant pays the full 
pe[n]alty, thereby putting both parties in the same position 
that they would have been in if the judgment had been paid 
immediately.").   
No. 
2015AP179   
 
23 
 
failure to recover a judgment before the amended statute was 
enacted is due to the circuit court's error.   
¶63 Although in the instant case there is arguably an 
identifiable point when Lands' End should have recovered its 
judgment (April 19, 2010, the date the circuit court denied 
summary judgment), other cases may present more complicated 
factual situations in which it would be difficult, if not 
impossible, to identify the point at which an offeror of 
settlement "should" have recovered a judgment.  Moreover, the 
text of Wis. Stat. § 807.01(4) ties the applicable interest rate 
to the "recover[y of] a judgment," not when a judgment "should 
have been" recovered.    
¶64 In sum, applying the amended version of the statutory 
rate of interest to Lands' End's judgment in the instant case is 
not retroactive, unfair, unreasonable, or unduly burdensome to 
Lands' End.  Rather, the amended version of the statute fosters 
legitimate legislative purposes.29  
¶65 Sixth, Lands' End argues that the amended version of 
Wis. Stat. § 807.01(4) (2013-14) applies retroactively because 
it "t[ook] away or impair[ed] vested rights" Lands' End acquired 
                                                 
29 See also infra, ¶¶106-108 (discussing the purposes of 
Wis. Stat. § 807.01(4) (2013-14)).    
No. 
2015AP179   
 
24 
 
under Wis. Stat. § 807.01(4) (2009-10) when it made its offer of 
settlement.30           
¶66 We turn now to a discussion of the concept of a 
"vested right," a concept related to retroactivity and to Lands' 
End's other arguments. 
(2) 
 
¶67 Lands' End did not have a vested right in the 12 
percent rate of interest in effect when it made its offer of 
settlement.   
¶68 Defining a "vested right" is somewhat difficult, and 
some definitions are opaque, circular, and conclusory.  One such 
definition of a vested right is that a vested right is a 
presently legally enforceable right, not dependent on uncertain 
future events.  Statutes and Statutory Construction (also known 
as Sutherland Statutory Construction), for example, describes 
several definitions of "vested right," including "an immediate 
right of present enjoyment or a present fixed right of future 
enjoyment."  2 Norman J. Singer & J.D. Shambie Singer, Statutes 
                                                 
30 A law is viewed as retroactive if it "'takes away or 
impairs vested rights acquired under existing laws, or creates a 
new obligation, imposes a new duty, or attaches a new 
disability, in respect to transactions or considerations already 
past . . . .'" 
State 
v. 
Chrysler 
Outboard 
Corp., 
219 
Wis. 2d 130, 172, 580 N.W.2d 203 (1998) (quoting In re Estate of 
Bilsie, 100 Wis. 2d 342, 357, 302 N.W.2d 508 (Ct. App. 1981)). 
Lands' End does not argue that the application of the 
amended version of Wis. Stat. § 807.01(4) to Lands' End was 
retroactive because it "creates a new obligation, imposes a new 
duty, or attaches a new disability, in respect to transactions 
or considerations already past." 
No. 
2015AP179   
 
25 
 
and Statutory Construction § 41:6, at 456 (7th ed. 2009) 
(footnote omitted).   
¶69 Our case law describes vested rights similarly: "[t]he 
concept of vested rights is conclusory——a right is vested when 
it has been so far perfected that it cannot be taken away by 
statute."  Soc'y Ins. v. LIRC, 2010 WI 68, ¶29, 326 Wis. 2d 444, 
786 N.W.2d 385 (quoting Neiman v. Am. Nat'l Prop. & Cas. Co., 
2000 WI 83, ¶14, 236 Wis. 2d 411, 613 N.W.2d 160); see also In 
re Paternity of John R.B., 2005 WI 6, ¶20, 277 Wis. 2d 378, 690 
N.W.2d 849; 
Black's 
Law 
Dictionary 
1520 
(10th 
ed. 
2014) 
(defining "vested right" as, among other things, "[a] right that 
so completely and definitely belongs to a person that it cannot 
be impaired or taken away without the person's consent.").   
¶70 A similar definition of a "vested right" has been 
formulated by the court in another context.  The court has 
stated that "[a]n existing right of action which has accrued 
under the rules of the common law or in accordance with its 
principles is a vested property right."  Matthies v. Positive 
Safety Mfg. Co., 2001 WI 82, ¶22, 244 Wis. 2d 720, 628 
N.W.2d 842 
(quoting 
Hunter 
v. 
Sch. 
Dist. 
Gale-Ettrick-
Trempealeau, 97 Wis. 2d 435, 445, 293 N.W.2d 515 (1980)).   
¶71 Lands' End argues in effect that it has a vested right 
to the 12 percent statutory rate of interest in Wis. Stat. 
§ 807.01(4) because its remedy under § 807.01(4) (2009-10) was 
"perfected" or "accrued" before Wis. Stat. § 807.01(4) (2013-14) 
took effect and is, therefore, a vested property right.   
No. 
2015AP179   
 
26 
 
¶72 We disagree with Lands' End.  Under both versions of 
Wis. Stat. § 807.01(4), Lands' End did not acquire a legally 
enforceable right to recover interest until it recovered a 
judgment.31  Unlike, for example, a right of action for 
negligence, which accrues (and is legally enforceable) on the 
date of the accident and injury, see Matthies, 244 Wis. 2d at 
738-39, Lands' End's right to recover interest under Wis. Stat. 
§ 807.01(4) accrues (and becomes legally enforceable) only after 
the recovery of a judgment.  Changing the interest rate in Wis. 
Stat. § 807.01(4) simply alters the legal consequence of events 
not yet completed.  Before Lands' End recovered a judgment, its 
right to interest was inchoate.  
¶73 The principle that vesting of a right does not occur 
until the right is no longer contingent is illustrated in 
Trinity Petroleum, Inc. v. Scott Oil Co., Inc., 2007 WI 88, 302 
Wis. 2d 299, 735 N.W.2d 1.   
¶74 In Trinity, we addressed, among other things, whether 
a party defending against an allegedly frivolous claim prior to 
the repeal of Wis. Stat. § 814.025 (2003-04), which authorized 
the recovery of costs and reasonable attorneys fees incurred in 
                                                 
31 See DeWitt Ross & Stevens v. Galaxy Gaming & Racing Ltd. 
P'ship, 2004 WI 92, ¶33, 273 Wis. 2d 577, 682 N.W.2d 839 (citing 
Osman v. Phipps, 2002 WI App 170, ¶¶8, 12, 256 Wis. 2d 589, 649 
N.W.2d 701) ("[I]nterest may not be imposed unless an actual 
judgment is entered in a case."); see also Tomsen v. Secura 
Ins., 2003 WI App 187, ¶10, 266 Wis. 2d 491, 668 N.W.2d 794 
(interest awarded when judgment was recovered based on a 
stipulation). 
No. 
2015AP179   
 
27 
 
defending against a frivolous claim brought before the repeal of 
§ 814.025, had a "vested right."32   
¶75 The Trinity court concluded that "[t]he legislature 
did not create a substantive, vested right to costs and 
reasonable attorneys fees in former Wis. Stat. § 814.025 (2003-
04)."33  Rather, the court explained that "[o]nly upon a finding 
by a circuit court that an action was frivolous under § 814.025 
(when that statute was still in effect) would an aggrieved party 
obtain a vested right to recover reasonable expenses under the 
statute."34  Because the circuit court "made no such finding in 
[Trinity] before the repeal of § 814.025," the aggrieved party 
had no vested right under the repealed statute.35 
                                                 
32 Trinity Petroleum, Inc. v. Scott Oil Co., Inc., 2007 WI 
88, ¶48, 302 Wis. 2d 299, 735 N.W.2d 1.     
33 Trinity, 302 Wis. 2d 299, ¶48.   
34 Trinity, 302 Wis. 2d 299, ¶48 (emphasis added).   
35 Trinity, 302 Wis. 2d 299, ¶48.  
Because the Trinity court concluded that the adoption of a 
new rule for sanctions and the repeal of Wis. Stat. § 814.025 
were procedural rules generally applied retroactively, the 
Trinity court remanded the cause to the circuit court to 
determine whether applying the new rule governing frivolous 
actions that case commenced under the former rule governing 
frivolous actions "impose[d] an unreasonable burden on the party 
charged with complying with the new rule's requirements."  
Trinity, 302 Wis. 2d 299, ¶7.    
Because we conclude that Wis. Stat. § 807.01(4) (2013-14) 
does not take away or impair vested rights and is not an undue 
burden in the instant case, no remand is needed to determine 
whether application of the amended version of the statute 
imposes an unreasonable burden. 
No. 
2015AP179   
 
28 
 
 
¶76 As with the finding of frivolousness in Trinity, a 
party has no right to recover interest from the date of an offer 
of settlement under either version of Wis. Stat. § 807.01(4) 
unless the party recovers a judgment for as much or more than 
the amount of the offer.   
¶77 In the instant case, Lands' End did not recover a 
judgment until after Wis. Stat. § 807.01(4) (2013-14) took 
effect.  Lands' End thus stands in a position similar to that of 
the defendant in Trinity.  Lands' End's entitlement to interest 
under Wis. Stat. § 807.01(4) (2009-10) was contingent on a 
subsequent determination by a court, namely that Lands' End was 
entitled to a judgment for greater than or equal to the amount 
of its offer of settlement.   
¶78 Also like the defendant in Trinity, Lands' End did not 
obtain such a determination while Wis. Stat. § 807.01(4) (2009-
10) was in effect.  Under these circumstances, Lands' End did 
not have a vested right to recover interest under Wis. Stat. 
§ 807.01(4) (2009-10).  See 2 Norman J. Singer & J.D. Shambie 
Singer, Statutes and Statutory Construction § 41:6, at 456-57 
(7th ed. 2009) ("The mere expectation of a future benefit or 
contingent interest does not create a vested right.").   
¶79 Accordingly, applying the "1 percent plus the prime 
rate" in the amended version of Wis. Stat. § 807.01(4) did not 
No. 
2015AP179   
 
29 
 
"take[] away or impair[] vested rights acquired [by Lands' End] 
under existing laws . . . ."36   
(3) 
¶80 Lands' End's claim under the Due Process clauses of 
the federal and state constitutions fails.   
¶81 Lands' End's Due Process claim rests on Wis. Stat. 
§ 807.01(4) (2013-14) having "a retroactive effect," and Lands' 
End's having "a vested right" under Wis. Stat. § 807.01(4) 
(2009-10).  See Soc'y Ins., 326 Wis. 2d 444, ¶29. 
¶82 As we explained previously, awarding interest to 
Lands' End under Wis. Stat. § 807.01(4) (2013-14) does not have 
a retroactive effect.  Furthermore, Lands' End did not acquire a 
vested right to the statutory interest rate in Wis. Stat. 
§ 807.01(4) (2009-10) while Wis. Stat. § 807.01(4) (2009-10) was 
in effect because Lands' End did not recover a judgment until 
after 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
took 
effect.  
Accordingly, awarding interest to Lands' End at "1 percent plus 
the prime rate" under Wis. Stat. § 807.01(4) (2013-14) does not 
                                                 
36 See Chrysler Outboard, 219 Wis. 2d at 172 (quoting 
Bilsie, 100 Wis. 2d at 357). 
No. 
2015AP179   
 
30 
 
take away or impair any vested rights.37  We therefore conclude 
that applying the amended statute to Lands' End in the instant 
case does not violate due process.   
(4) 
 
¶83 Awarding interest to Lands' End under the amended 
version of Wis. Stat. § 807.01(4) (2013-14) does not violate 
Wis. Stat. § 990.04 (2013-14). 
¶84 Wisconsin Stat. § 990.04 (2013-14), entitled "Actions 
pending not defeated by repeal of statute," provides (with 
emphasis added):  
The repeal of a statute hereafter shall not remit, 
defeat or impair any civil or criminal liability for 
offenses committed, penalties or forfeitures incurred 
or rights of action accrued under such statute before 
the repeal thereof, whether or not in course of 
prosecution or action at the time of such repeal; but 
all such offenses, penalties, forfeitures and rights 
of action created by or founded on such statute, 
liability wherefore shall have been incurred before 
the time of such repeal thereof, shall be preserved 
and remain in force notwithstanding such repeal, 
unless specially and expressly remitted, abrogated or 
done away with by the repealing statute. And criminal 
prosecutions and actions at law or in equity founded 
upon such repealed statute, whether instituted before 
or after the repeal thereof, shall not be defeated or 
                                                 
37 Because awarding interest to Lands' End at the statutory 
rate in Wis. Stat. § 807.01(4) (2013-14) does not have a 
retroactive effect or impair vested rights, we need not address 
the rational basis test, see Pension Benefit Guaranty Corp. v. 
R.A. Gray & Co., 467 U.S. 717, 730 (1984); Usery v. Turner 
Elkhorn Mining Co., 428 U.S. 1, 15 (1976), or Lands' End's 
argument regarding the balancing of the public interest served 
by applying the amended law retroactively against the private 
interests that retroactive application would affect.  See 
Matthies, 244 Wis. 2d 720, ¶27. 
No. 
2015AP179   
 
31 
 
impaired by such repeal but shall, notwithstanding 
such repeal, proceed to judgment in the same manner 
and to the like purpose and effect as if the repealed 
statute continued in full force to the time of final 
judgment thereon, unless the offenses, penalties, 
forfeitures 
or 
rights 
of 
action 
on 
which 
such 
prosecutions or actions shall be founded shall be 
specially and expressly remitted, abrogated or done 
away with by such repealing statute. 
¶85 Before we discuss Lands' End's arguments regarding 
Wis. Stat. § 990.04 (2013-14) we observe that the arguments are 
largely undeveloped.  "We do not usually address undeveloped 
arguments."38  Nevertheless, Lands' End cited several cases 
interpreting and applying Wis. Stat. § 990.04 (2013-14).  These 
cases do not support Lands' End's position.   
¶86 Specifically, 
Lands' 
End 
relies 
upon 
the 
interpretation of Wis. Stat. § 990.04 in Jackson County Iron Co. 
v. Musolf, 134 Wis. 2d 95, 104, 396 N.W.2d 323 (1986).  The 
Jackson County court stated:  "[I]t is the clear intention of 
sec. 990.04 to preserve all rights which may have arisen before 
the repeal of a statute unless such rights are 'specially and 
expressly remitted, abrogated or done away with by the repealing 
statute.'"  134 Wis. 2d at 104 (emphasis added) (quoting Niesen 
v. State, 30 Wis. 2d 490, 493-94, 141 N.W.2d 194 (1966)).   
¶87 Jackson County cites Bratton v. Town of Johnson, 76 
Wis. 430, 434, 45 N.W. 412 (1890).  Bratton discussed the effect 
of the repeal of statutory remedies, stating, "The repeal of 
                                                 
38 See DOJ v. DWD, 2015 WI 114, ¶33, 365 Wis. 2d 694, 875 
N.W.2d 545 (quoting State v. Gracia, 2013 WI 15, ¶28 n.13, 345 
Wis. 2d 488, 826 N.W.2d 87) (alteration omitted). 
No. 
2015AP179   
 
32 
 
statutes that simply affect the remedy does not defeat or impair 
any civil liability incurred, or rights of action accrued, under 
them, . . . unless specially and expressly remitted, abrogated, 
or done away with by such repealing statute."  Bratton, 76 Wis. 
at 434.  
¶88 Lands' End's right to interest did not arise until 
Lands' End recovered a judgment; this event occurred when Lands' 
End recovered a judgment after Wis. Stat. § 807.01(4) (2013-14) 
took effect.  As a result, Lands' End's reliance on Wis. Stat. 
§ 990.04 (2013-14) is misplaced.    
 
¶89 This 
conclusion 
is 
reinforced 
by 
the 
court's 
discussions of the predecessor of Wis. Stat. § 990.04 (2013-14), 
Wis. Stat. § 370.04 (1953-54), in Waddell v. Mamat, 271 
Wis. 176, 181, 72 N.W.2d 763 (1955), and Metropolitan Life 
Insurance Co. v. Wisconsin Labor Relations Board, 237 Wis. 464, 
297 N.W. 430 (1941).  
 
¶90 Both 
Waddell 
and 
Metropolitan 
Life 
distinguished 
between 
accrued, 
legally 
enforceable 
rights 
and 
rights 
contingent on future events, observing that such contingent 
rights "could ripen into a right preserved by sec. 370.04 only 
upon the happening of a further event . . . ."  See Waddell, 271 
Wis. at 181 (citing Metro. Life Ins. Co. v. Wis. Labor Relations 
Bd., 237 Wis. 464, 297 N.W. 430 (1941)).  Under Waddell and 
Metropolitan Life, an unperfected or "inchoate" right, dependent 
on future events, is not protected by Wis. Stat. § 990.04.  See 
Waddell, 271 Wis. at 181; Metropolitan Life, 237 Wis. at 472.  
No. 
2015AP179   
 
33 
 
¶91 Lands' End argues in effect that it has "perfected" or 
"accrued" a right to the 12 percent statutory rate of interest 
in Wis. Stat. § 807.01(4) (2009-10) because its remedy under 
§ 807.01(4) (2009-10) was perfected or accrued before Wis. Stat. 
§ 807.01(4) (2013-14) took effect.   
 
¶92 As we have previously explained, however, Lands' End 
did not have a perfected or accrued (or "vested" or "ripened") 
right to the 12 percent interest rate before Wis. Stat. 
§ 807.01(4) (2013-14) took effect.  Lands' End's right to 
recover interest under Wis. Stat. § 807.01(4) (2009-10) was 
inchoate; it was contingent on Lands' End's first obtaining a 
judgment for as much or more than the amount of its offer of 
settlement.   
 
¶93 Wisconsin 
Stat. 
§ 990.04 
(2013-14) 
is 
thus 
not 
implicated in the instant case.     
(5) 
 
¶94 Finally, 
Lands' 
End 
argues 
that 
if 
Wis. 
Stat. 
§ 807.01(4) (2013-14) is applied to Lands' End in the instant 
case, the Equal Protection clauses of the federal and state 
constitutions would be violated.  A recurring theme in Lands' 
End's discussion of equal protection (as elsewhere) is that it 
is being harmed because of the circuit court's error in denying 
Lands' End's motion for summary judgment (which resulted in 
Lands' End recovering a judgment after Wis. Stat. § 807.01(4) 
(2013-14) took effect).  We discussed our rejection of this 
theme in ¶¶62-64, above.   
No. 
2015AP179   
 
34 
 
¶95 Our case law takes various approaches to analyzing 
equal protection challenges.  We follow the approach taken by 
Lands' End.   
¶96 Equal protection challenges can be addressed in three 
steps: (1) does the statute create a distinct class of persons, 
(2) does the statute treat that class of persons differently 
from all others similarly situated; and (3) does a rational 
basis exist for the difference in treatment?  See Metro. Assocs. 
v. City of Milwaukee, 2011 WI 20, ¶23, 332 Wis. 2d 85, 796 
N.W.2d 717 (citing Nankin v. Vill. of Shorewood, 2001 WI 92, 245 
Wis. 2d 86, 630 N.W.2d 141).   
 
¶97 Lands' End argues that 2011 Wis. Act 69 (enacting Wis. 
Stat. § 807.01(4) (2013-14)) creates two distinct classes——those 
who made an offer of settlement and recovered a judgment while 
Wis. Stat. § 807.01(4) (2009-10) was in effect, and those who 
made an offer of settlement prior to Act 69 but did not recover 
a judgment until after the enactment of Wis. Stat. § 807.01(4) 
(2013-14).  Lands' End argues that these classes are treated 
differently——those in the first class are entitled to interest 
at a rate of 12 percent under Wis. Stat. § 807.01(4) (2009-10), 
while those in the second class are entitled to interest at "1 
percent plus the prime rate" under Wis. Stat. § 807.01(4) (2013-
14).   
 
¶98 In Lands' End's view, because this classification is 
"irrational or arbitrary," it violates the Equal Protection 
clauses of the federal and state constitutions.  See Metro. 
Assocs., 332 Wis. 2d 85, ¶61 (quotation omitted).   
No. 
2015AP179   
 
35 
 
 
¶99 Because Wis. Stat. § 807.01(4) does not implicate 
fundamental rights or suspect classifications, we apply the 
rational basis test in assessing Lands' End's equal protection 
challenge.  See Ferdon ex rel. Petrucelli v. Wis. Patients Comp. 
Fund, 2005 WI 125, ¶¶64-66, 284 Wis. 2d 573, 701 N.W.2d 440.   
 
¶100 In 
assessing 
the 
rationality 
of 
a 
legislative 
classification, Lands' End directs us to five criteria:  
(1) All 
classification[s] 
must 
be 
based 
upon 
substantial distinctions which make one class 
really different from another;  
(2) The classification adopted must be germane to the 
purpose of the law; 
(3) The classification must not be based on existing 
circumstances 
only. 
 
[It 
must 
not 
be 
so 
constituted as to preclude addition to the 
numbers included within the class];  
(4) To whatever class a law may apply, it must apply 
equally to each member thereof;  
(5) The characteristics of each class should be so 
far different from those of other classes as to 
reasonably suggest at least the propriety, having 
regard to the public good, of substantially 
different legislation.   
Metro. 
Assocs., 
332 
Wis. 2d 85, 
¶64 
(citing 
Nankin, 
245 
Wis. 2d 86, ¶39).   
 
¶101 Lands' End argues that if Wis. Stat. § 807.01(4) 
(2013-14) is applied to those who made offers of settlement 
while Wis. Stat. § 807.01(4) (2009-10) was in effect, the 
classification created by the amended version of the statute 
(2011 Wis. Act 69) fails the first, second, and fifth criteria.  
We disagree with Lands' End.   
No. 
2015AP179   
 
36 
 
 
¶102 As to the first criterion, Lands' End argues that no 
real difference exists between the two classes of plaintiffs 
that Lands' End identified.  The argument is that the only real 
difference between the two classes is that the recovery of 
judgment was delayed for plaintiffs like Lands' End (in Lands' 
End's case, because of an erroneous circuit court decision).   
¶103 We conclude that the classes identified by Lands' End 
are substantially distinct from one another.  As we explained 
previously, Lands' End and others who made offers of settlement 
under Wis. Stat. § 807.01(4) (2009-10) but did not recover a 
judgment until after § 807.01(4) (2013-14) took effect did not 
acquire a vested right in the statutory interest rate in effect 
when they made their offers of settlement.   
¶104 Conversely, parties who made offers of settlement and 
recovered judgments for as much or more than the offer prior to 
the effective date of Wis. Stat. § 807.01(4) (2013-14) do have 
vested rights in the 12 percent interest rate, as long as they 
have met all the requirements to recover interest under Wis. 
Stat. § 807.01(4) (2009-10).  This is a substantial distinction.    
 
¶105 As to the second criterion, Lands' End asserts again 
that denying 12 percent interest to plaintiffs like Lands' End, 
for whom recovery of judgment was delayed by a circuit court 
error, is not germane to the purpose of the statute. 
¶106 In evaluating "whether a legislative classification 
rationally advances the legislative objective, 'we are obligated 
to locate or, in the alternative, construct a rationale that 
might have influenced the legislative determination.'"  Ferdon, 
No. 
2015AP179   
 
37 
 
284 Wis. 2d 573, ¶74 (quoting Aicher ex rel. LaBarge v. Wis. 
Patients Comp. Fund, 2000 WI 98, ¶57, 237 Wis. 2d 99, 613 
N.W.2d 849).   
¶107 Amending 
the 
statute 
governing 
interest 
rates 
applicable to offers of settlement to reduce the applicable rate 
of interest to near-market rates for those who recover a 
judgment after Wis. Stat. § 807.01(4) (2013-14) took effect 
fulfills various legislative objectives:  (1) it ensures that 
prevailing parties will be compensated fairly and reasonably for 
being unable to use money to which they are entitled during the 
pendency of the litigation;39 and (2) it justly and practicably 
alleviates the unreasonable burden of imposing liability for 
interest far above market interest rates on the payor.   
¶108 By tying the interest rate in Wis. Stat. § 807.01(4) 
(2013-14) to market rates, the legislature created a system that 
is fair to both parties under the circumstance of the instant 
case.  Parties like Lands' End are still compensated at an 
above-market rate for being unable to use money to which they 
are "entitled" during the pendency of the litigation, while 
defendants like the City of Dodgeville still have an incentive 
to accept reasonable settlement offers.   
¶109 Finally, addressing the fifth criterion, Lands' End 
does not find any distinctions between the classes created by 
2011 Wis. Act 69, again arguing that the difference is that the 
                                                 
39 See Upthegrove Hardware, Inc. v. Pa. Lumbermans Ins. Co., 
152 Wis. 2d 7, 13, 447 N.W.2d 367 (Ct. App. 1989). 
No. 
2015AP179   
 
38 
 
circuit court erred initially and the court of appeals did not 
reverse the circuit court timely.   
¶110 We conclude that, having regard to the public good, 
the legislature could reasonably conclude that treating parties 
with vested rights differently from parties who do not have 
vested rights is rational.  Doing otherwise may raise due 
process questions.  See Soc'y Ins., 326 Wis. 2d 444, ¶29.   
¶111 Accordingly, we conclude that applying Wis. Stat. 
§ 807.01(4) (2013-14) to those, like Lands' End, who made offers 
of settlement while Wis. Stat. § 807.01(4) (2009-10) was in 
effect but who did not recover a judgment until after Wis. Stat. 
§ 807.01(4) (2013-14) took effect does not violate the Equal 
Protection clauses of the federal and state constitutions.   
* * * * 
¶112 For the reasons set forth, we affirm the circuit 
court's judgment and order awarding Lands' End interest at "1 
percent plus the prime rate," the rate in the amended version of 
the statute, Wis. Stat. § 807.01(4) (2013-14), which was in 
effect when Lands' End recovered its judgment against the City 
of Dodgeville.   
¶113 Awarding interest at "1 percent plus the prime rate" 
in the instant case is not a retroactive application of Wis. 
Stat. § 807.01(4) (2013-14) and Lands' End did not have a vested 
right in the 12 percent interest rate in effect in Wis. Stat. 
§ 807.01(4) (2009-10) at the time Lands' End made its offer of 
settlement.  The circuit court's judgment and order do not 
violate the Due Process clauses of the federal and state 
No. 
2015AP179   
 
39 
 
constitutions or Wis. Stat. § 990.04.  Moreover, because the 
legislature had a rational basis for changing the applicable 
interest rate from 12 percent to "1 percent plus the prime rate" 
and did not create an irrational or arbitrary classification, 
awarding interest under Wis. Stat. § 807.01(4) (2013-14) does 
not violate the Equal Protection clauses of the federal and 
state constitutions.   
¶114 Our decision in the instant case is contrary to the 
opinion of the court of appeals' in Johnson v. Cintas Corp. No. 
2, 2015 WI App 14, 360 Wis. 2d 350, 860 N.W.2d 515.  In Johnson, 
the court of appeals held that applying the amended version of 
the rate of interest to offers of settlement made prior to the 
effective date of the amended version would disturb a vested 
right to interest.  Johnson is an officially published opinion 
of the court of appeals.  "Officially published opinions of the 
court of appeals shall have statewide precedential effect."  
Wis. Stat. § 752.41(2) (2013-14).  We overrule the Johnson 
decision. 
¶115 Accordingly, we affirm the judgment and order of the 
circuit court in the instant case. 
By the Court.—The order and judgment of the circuit court 
is affirmed.   
¶116 REBECCA G. BRADLEY, J., did not participate. 
 
 
 
No.  2015AP179.akz 
 
1 
 
¶117 ANNETTE 
KINGSLAND 
ZIEGLER, 
J.   (concurring). 
 
I 
concur in the lead opinion's conclusion to affirm; I do not join 
the lead opinion's entire analysis.1  Although I agree with much 
of the lead opinion's analysis in this case, I write separately 
because I fear our jurisprudence on retroactive legislation is 
in the process of becoming unmoored from fundamental principles 
of constitutional law and statutory interpretation.  For 
example, while the lead opinion cites specific factors pertinent 
to the instant case, it fails to anchor those factors to the 
overriding applicable principles.  Therefore, I write to 
reemphasize the relevant framework when the court analyzes a 
claim that legislation is retroactive and cannot be applied in a 
particular case.  
¶118 I also write because in retroactive legislation cases, 
Wisconsin jurisprudence has sometimes muddied the waters, using 
the concept of rational basis review interchangeably with the 
concept of a "balancing test."2  As will be explained, these two 
                                                 
1 I also concur in the lead opinion's decision to overrule 
Johnson v. Cintas Corp. No. 2, 2015 WI App 14, 360 Wis. 2d 350, 
860 N.W.2d 515. See infra ¶¶176 n.15, 177 n.16; lead op., ¶¶7, 
116. 
2 Traditionally, a balancing test is a totality-of-the 
circumstances-type test.  See, e.g., State v. Malone, 2004 WI 
108, ¶21, 274 Wis. 2d 540, 683 N.W.2d 1 ("Law enforcement action 
is to be judged against the standard of reasonableness, which in 
turn 'depends "on a balance between the public interest and the 
individual's right to personal security free from arbitrary 
interference by law officers."' In crafting this balance, this 
court 
must 
carefully 
scrutinize 
the 
totality 
of 
the 
circumstances" (citations omitted).).  In contrast, in applying 
a rational basis test, a court does not, for instance, balance 
society's expectations; the court simply determines whether the 
legislature had a rational basis for doing what it did. 
No.  2015AP179.akz 
 
2 
 
concepts could be applied consistently with each other, as long 
as the balancing test is understood to be a tool to determine 
whether a statute is rationally related to a legitimate 
government purpose.3  
¶119 Wisconsin Stat. § 807.01(4) (2009-10) entitles a party 
who recovers a judgment greater than or equal to the amount 
specified in the party's earlier, rejected offer of settlement 
to obtain interest at an annual rate of 12 percent on the amount 
recovered from the date of the offer of settlement until the 
amount is paid.  Wis. Stat. § 807.01(4) (2009-10).  In 2011 the 
legislature amended Wis. Stat. § 807.01(4) (2009-10), reducing 
the applicable interest rate to "1 percent plus the prime 
rate . . . as reported by the federal reserve board in federal 
reserve statistical release H. 15."  See 2011 Wis. Act 69; Wis. 
Stat. § 807.01(4) (2013-14).4  
¶120 Lands' End, Inc. ("Lands' End") has been embroiled in 
litigation with the City of Dodgeville ("the City") for several 
                                                 
3 We took this case in large part to address the Johnson 
court's assessment of a due process challenge to the amendments 
to Wis. Stat. § 807.01(4).  The Johnson court applied our due 
process balancing test and concluded that application of Wis. 
Stat. § 807.01(4) (2013-14) in that case was unconstitutional.  
Johnson, 360 Wis. 2d 350, ¶¶27-29.  Lands' End, Inc. devotes 
much of its briefing to its own due process challenge to the 
amendments to Wis. Stat. § 807.01(4), relying extensively on 
Johnson. 
4 The statute provides that the applicable prime rate in a 
given case is the "the prime rate in effect on January 1 of the 
year in which the judgment is entered if the judgment is entered 
on or before June 30 of that year or in effect on July 1 of the 
year in which the judgment is entered if the judgment is entered 
after June 30 of that year."  Wis. Stat. § 807.01(4) (2013-14). 
No.  2015AP179.akz 
 
3 
 
years.  Lands' End tendered an offer of settlement to the City 
prior to the amendments to Wis. Stat. § 807.01(4), but recovered 
or will recover a judgment greater than the amount specified in 
that settlement offer after the amendment to § 807.01(4) (2009-
10) has taken effect.  
¶121 Lands' End insists that it is entitled to the 12 
percent interest rate in the pre-2011 version of § 807.01(4), 
and supports its claim with four arguments.  
¶122 First, Lands' End relies on a canon of statutory 
construction known as the "presumption against retroactivity" to 
argue that this court should simply interpret Wis. Stat. 
§ 807.01(4) (2013-14) so that the new interest rate does not 
apply to Lands' End.  See generally Antonin Scalia & Bryan A. 
Garner, Reading Law 261-65 (2012).  Next, Lands' End argues that 
constitutional 
guarantees 
prohibit 
the 
Wisconsin 
State 
Legislature from reducing the interest rate in Wis. Stat. 
§ 807.01(4) (2009-10) and applying that new rate to parties, 
such as Lands' End, who had made offers of settlement prior to 
the amendments to that statute.  Specifically, Lands' End 
contends that, because it possesses a "vested" right to the 
earlier 12 percent interest rate, application to Lands' End of 
the amendments to § 807.01(4) violates the Due Process Clause of 
the Fourteenth Amendment to the United States Constitution, 
which bars states from depriving persons of life, liberty, or 
property "without adequate procedures," Arneson v. Jezwinski, 
225 Wis. 2d 371, 400, 592 N.W.2d 606 (1999) (citation omitted), 
and 
which 
separately 
"provides 
protection 
from 
'certain 
No.  2015AP179.akz 
 
4 
 
arbitrary, wrongful government actions,'" State ex rel. Greer v. 
Wiedenhoeft, 2014 WI 19, ¶57, 353 Wis. 2d 307, 845 N.W.2d 373 
(citation omitted).  See U.S. Const. amend XIV, § 1.5  Lands' End 
also argues that application to it of the amendments to Wis. 
Stat. § 807.01(4) violates the Equal Protection Clause of the 
Fourteenth Amendment to the United States Constitution, which 
"is designed to assure that those who are similarly situated 
will be treated similarly."  State v. Smith, 2010 WI 16, ¶15, 
323 Wis. 2d 377, 780 N.W.2d 90 (citation omitted).  See U.S. 
Const. amend XIV, § 1.6  
¶123 Finally, Lands' End claims that application to it of 
the amendments to § 807.01(4) violates Wis. Stat. § 990.04 
(2013-14), which provides in part that the repeal of a statute 
does not remit, defeat, or impair any civil or criminal 
liability for offenses committed, penalties or forfeitures 
                                                 
5 Lands' End actually does not appear to specify whether it 
is bringing a due process claim under the federal constitution, 
the state constitution, or both.  As will be explained, this 
does not affect the outcome of my analysis.  See infra n.6. 
6 Lands' End also brings a claim under the equal protection 
provision of the Wisconsin Constitution.  See Wis. Const. art. 
1, § 1; Aicher v. Wis. Patients Compensation Fund, 2000 WI 98, 
¶55 & n.14, 237 Wis. 2d 99, 613 N.W.2d 849.  As noted, supra 
n.5, the nature of Lands' End's due process claim is not clear.  
However, "[t]his court has held the due process and equal 
protection clauses of the Wisconsin Constitution are the 
substantial equivalents of their respective clauses in the 
federal constitution," and Lands' End does not argue that we 
should interpret the federal and state constitutions differently 
in this case.  State v. Smith, 2010 WI 16, ¶12, 323 Wis. 2d 377, 
780 N.W.2d 90.  For simplicity, I will therefore refer only to 
the federal constitution in this writing, as this will equally 
dispose of any state constitutional claims. 
No.  2015AP179.akz 
 
5 
 
incurred, or rights of action accrued prior to the repeal of the 
repealed statute, 
unless the legislature expressly states 
otherwise.  See Wis. Stat. § 990.04 (2013-14).   
¶124 Each of Lands' End's arguments fail.  First, the canon 
of construction——the presumption against retroactivity——does not 
apply because under these facts Lands' End has failed to 
demonstrate 
that 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
has 
retroactive effect.  Lands' End's due process claim is based 
upon the statute having retroactive effect.  Because under these 
facts it does not, Lands' End's due process claim does not 
warrant discussion.  
¶125 Second, Lands' End's right to equal protection under 
the law is not violated by Wis. Stat. § 807.01(4) (2013-14).  
Lands' End does not argue, nor does this record support the 
argument, that this case involves fundamental rights or suspect 
classes. There is a "reasonable basis" for differentiating 
between parties which had and which had not obtained judgments 
prior to enactment of Wis. Stat. § 807.01(4) (2013-14).  See 
Smith, 323 Wis. 2d 377, ¶15.  
¶126 Finally, the amendments to Wis. Stat. § 807.01(4) do 
not "remit, defeat or impair any civil or criminal liability for 
offenses committed, penalties or forfeitures incurred or rights 
of action accrued under" Wis. Stat. § 807.01(4) (2009-10), so 
Wis. Stat. § 990.04 (2013-14) does not apply.  Consequently, I 
would affirm the decision of the circuit court.   
 
I.  THE POLICE POWER OF THE STATES AND THE  
PRESUMPTION OF CONSTITUTIONALITY 
No.  2015AP179.akz 
 
6 
 
¶127 In part, this case focuses on a putative limit on our 
state legislature: Lands' End argues that, after it made an 
offer of settlement to the City under Wis. Stat. § 807.01(4) 
(2009-10), the legislature was powerless to change the interest 
rate applicable to the amount Lands' End might ultimately 
recover from the City.  In order to understand more fully any 
applicable limits on state legislative power, it is appropriate 
first to review the nature of the power to which such 
limitations would apply.  
[P]revious to the formation of the new constitution, 
we were divided into independent states, united for 
some purposes, but in most respects, sovereign.  These 
states 
could 
exercise 
almost 
every 
legislative 
power . . . . When the American people created a 
national legislature, with certain enumerated powers, 
it was neither necessary nor proper to define the 
powers retained by the states.  These powers proceed, 
not from the people of America, but from the people of 
the several states; and remain, after the adoption of 
the constitution, what they were before, except so far 
as they may be abridged by that instrument. 
Sturges v. Crowninshield, 17 U.S. (4 Wheat.) 122, 192-93 (1819) 
(per Marshall, C.J.). 
¶128 Thus, 
"[i]n 
our 
federal 
system, 
the 
National 
Government possesses only limited powers; the States and the 
people retain the remainder.  The States have broad authority to 
enact legislation for the public good——what we have often called 
a 'police power.'"  Bond v. United States, 572 U.S. __, 134 S. 
Ct. 2077, 2086 (2014) (citation omitted).  This authority is 
indeed broad: "it is much easier to perceive and realize the 
existence and sources of it than to mark its boundaries, or 
prescribe limits to its exercise."  Slaughter-House Cases, 83 
No.  2015AP179.akz 
 
7 
 
U.S. (16 Wall.) 36, 62 (1872) (citation omitted); see also 
Queenside Hills Realty Co. v. Saxl, 328 U.S. 80, 83 (1946) 
(police power is "one of the least limitable of governmental 
powers" (citations omitted).).  This is so because the "police 
power" is simply "the powers of government inherent in every 
sovereignty to the extent of its dominions."  Nebbia v. New 
York, 291 U.S. 502, 524 (1934) (citation omitted). 
¶129 Partial definitions have, however, been attempted.  
"[T]he police power of a state embraces regulations designed to 
promote the public convenience or the general prosperity, as 
well as regulations designed to promote the public health, the 
public morals, or the public safety."  Chicago, B. & Q. Ry. Co. 
v. Illinois, 200 U.S. 561, 592 (1906) (citations omitted); see 
also Slaughter-House Cases, 83 U.S. at 62 (police power 
"extends . . . to the protection of the lives, limbs, health, 
comfort, and quiet of all persons, and the protection of all 
property within the State" (citation omitted).).  
¶130 All of this is not to say that the police power is 
unlimited; 
it 
is 
of 
course 
subject 
to 
constitutional 
restrictions.  See, e.g., Lambert v. California, 355 U.S. 225, 
228 (1957); Panhandle E. Pipe Line Co. v. State Highway Comm'n 
of Kansas, 294 U.S. 613, 619 (1935); Nebbia, 291 U.S. at 524-25.  
But this court must always be hesitant to exercise its own power 
to declare that the legislature has exceeded its authority.   
[The legislature] is supreme in all cases where it is 
not restrained by the constitution; and as it is the 
duty of legislators as well as judges to consult this 
and conform their acts to it, so it should be presumed 
that all their acts do conform to it unless the 
No.  2015AP179.akz 
 
8 
 
contrary is manifest.  This confidence is necessary to 
insure due obedience to its authority.  If this be 
frequently questioned, it must tend to diminish the 
reverence for the laws which is essential to the 
public safety and happiness. . . .  The interference 
of the judiciary with legislative Acts, if frequent or 
on dubious grounds, might occasion so great a jealousy 
of this power and so general a prejudice against it as 
to lead to measures ending in the total overthrow of 
the independence of the judges, and so of the best 
preservative of the constitution.  The validity of the 
law ought not then to be questioned unless it is so 
obviously repugnant to the constitution that when 
pointed out by the judges, all men of sense and 
reflection 
in 
the 
community 
may 
perceive 
the 
repugnancy. By such a cautious exercise of this 
judicial check, no jealousy of it will be excited, the 
public confidence in it will be promoted, and its 
salutary effects be justly and fully appreciated. 
James B. Thayer, The Origin and Scope of the American Doctrine 
of Constitutional Law, 7 Harv. L. Rev. 129, 142 (1893) (quoting 
Byrne's Adm'rs v. Stewart's Adm'rs, 3 S.C. Eq. 466, 476-77 (3 
Des. 466) (S.C. App. Eq. 1812)).  Fittingly, then, this court 
"has 
often 
affirmed 
the 
well-established 
presumption 
of 
constitutionality that attaches itself to all legislative acts."  
State ex rel. Hammermill Paper Co. v. La Plante, 58 Wis. 2d 32, 
46, 205 N.W.2d 784 (1973).  In fact, we require litigants 
challenging the constitutionality of a statute to establish the 
statute's 
unconstitutionality 
"beyond 
a 
reasonable 
doubt." 
Madison Teachers, Inc. v. Walker, 2014 WI 99, ¶76, 358 
Wis. 2d 1, 851 N.W.2d 337.  We must view with skepticism any 
claim that the legislature has violated the federal or state 
constitutions. 
 
II.  RETROACTIVE LEGISLATION AND THE PRESUMPTION  
AGAINST RETROACTIVITY 
No.  2015AP179.akz 
 
9 
 
¶131 This case requires the court to determine whether Wis. 
Stat. § 807.01(4) (2013-14) is retroactive in effect.  Generally 
speaking, a retroactive law is "a legislative act that looks 
backward or contemplates the past, affecting acts or facts that 
existed before the act came into effect."  Retroactive law, 
Black's Law Dictionary 1511 (10th ed. 2014).  On the other hand, 
"[a] statute does not operate 'retrospectively' merely because 
it is applied in a case arising from conduct antedating the 
statute's enactment or upsets expectations based in prior law."  
Landgraf v. USI Film Products, 511 U.S. 244, 269 (1994) 
(citation omitted).7  Additionally, "a statute 'is not made 
retroactive merely because it draws upon antecedent facts for 
its operation.'"  Id. at 269 n.24 (citation omitted).  
¶132 Determining whether a statute has retroactive effect 
"demands a commonsense, functional judgment about 'whether the 
new 
provision 
attaches 
new 
legal 
consequences 
to 
events 
completed before its enactment.'"  Martin v. Hadix, 527 U.S. 
343, 357-58 (1999) (citation omitted). 
The 
conclusion 
that 
a 
particular 
rule 
operates 
"retroactively" comes at the end of a process of 
judgment concerning the nature and extent of the 
change in the law and the degree of connection between 
the operation of the new rule and a relevant past 
event.  Any test of retroactivity will leave room for 
disagreement in hard cases, and is unlikely to 
                                                 
7 Although the words "retroactive" and "retrospective" 
technically possess distinct meanings, see, e.g., 16B Am. Jur. 
2d Constitutional Law § 735, the terms "are synonymous in 
judicial usage and may be employed interchangeably."  2 
Sutherland Statutory Construction § 41:1 (7th ed.).  See also 
Landgraf v. USI Film Products, 511 U.S. 244, 269 n.23 (1994). 
No.  2015AP179.akz 
 
10 
 
classify the enormous variety of legal changes with 
perfect philosophical clarity.  However, retroactivity 
is 
a 
matter 
on 
which 
judges 
tend 
to 
have 
"sound . . . instinct[s]," 
see 
Danforth 
v. 
Groton 
Water Co., 178 Mass. 472, 476, 59 N.E. 1033, 1034 
(1901) (Holmes, J.), and familiar considerations of 
fair 
notice, 
reasonable 
reliance, 
and 
settled 
expectations offer sound guidance. 
Landgraf, 511 U.S. at 269. 
¶133 State statutes are not unconstitutional simply because 
they apply retroactively.  League v. Texas, 184 U.S. 156, 161 
(1902).  "That there exists a general power in the state 
governments to enact retrospective or retroactive laws, is a 
point too well settled to admit of question at this day."  Id. 
(internal quotation marks omitted) (citation omitted).  "Absent 
a violation of one of [the Constitution's] specific provisions, 
the potential unfairness of retroactive civil legislation is not 
a sufficient reason for a court to fail to give a statute its 
intended scope."  Landgraf, 511 U.S. at 267. 
¶134 At the same time, "[t]he principle that the legal 
effect of conduct should ordinarily be assessed under the law 
that existed when the conduct took place has timeless and 
universal human appeal" and "has long been a solid foundation of 
American law."  Kaiser Aluminum & Chemical Corp. v. Bonjorno, 
494 U.S. 827, 855 (1990) (Scalia, J, concurring).  "Elementary 
considerations of fairness dictate that individuals should have 
an opportunity to know what the law is and to conform their 
conduct accordingly; settled expectations should not be lightly 
disrupted."  Landgraf, 511 U.S. at 265.  Thus,  
[t]he presumption is very strong that a statute was 
not meant to act retrospectively, and it ought never 
to receive such a construction if it is susceptible of 
No.  2015AP179.akz 
 
11 
 
any 
other. 
 
It 
ought 
not 
to 
receive 
such 
a 
construction unless the words used are so clear, 
strong and imperative that no other meaning can be 
annexed to them or unless the intention of the 
legislature cannot be otherwise satisfied. 
U.S. Fid. & Guar. Co v. United States, 209 U.S. 306, 314 (1908) 
(citations 
omitted). 
 
In 
sum, 
this 
"presumption 
against 
retroactivity" 
is 
a 
"guide 
to 
interpretation, 
not 
a 
constitutional imperative, because the presumption applies even 
when the Constitution does not forbid retroactivity."  Antonin 
Scalia & Bryan A. Garner, supra at 261.  
¶135 Given the foregoing, analysis in cases involving 
potentially-retroactive 
legislation 
follows 
a 
three-step 
process: (1) the court determines whether the legislature has 
"expressly prescribed the statute's proper reach," because if it 
has done so, "there is no need to resort to judicial default 
rules" and the statute is applied as written;8 (2) if it is 
unclear whether the statute is meant to apply retroactively, the 
court "must determine whether the new statute would have 
retroactive effect, i.e., whether it would impair rights a party 
possessed when he acted, increase a party's liability for past 
conduct, or impose new duties with respect to transactions 
already completed"; and (3) if the court concludes the statute 
would indeed have a retroactive effect, the presumption against 
retroactivity is applied and the statute is not applied 
                                                 
8 "[I]n the absence of language as helpful as [an express 
prescription,] [the court] tr[ies] to draw a comparably firm 
conclusion about the temporal reach specifically intended by 
applying '[its] normal rules of construction.'"  Fernandez-
Vargas v. Gonzales, 548 U.S. 30, 37 (2006) (citation omitted).  
No.  2015AP179.akz 
 
12 
 
retroactively.  Landgraf, 511 U.S. at 280; see also Fernandez-
Vargas v. Gonzales, 548 U.S. 30, 37 (2006). 
¶136 Much litigation revolves around part two of this 
three-part test: resolving the question of whether a particular 
enactment applies retroactively.  See e.g., Vartelas v. Holder, 
566 U.S. ___, 132 S. Ct. 1479, 1483-84 (2012).  It is in the 
resolution of these types of questions that certain other legal 
issues become relevant, such as whether a statute is procedural 
or substantive and whether application of the statute would 
upset "vested rights."  See, e.g., Landgraf, 511 U.S. at 273-75.9  
It is worth dwelling on this latter point for a moment. 
                                                 
9 The Supreme Court has stated that "[e]ven absent specific 
legislative authorization, application of new statutes passed 
after the events in suit is unquestionably proper in many 
situations."  Landgraf, 511 U.S. at 273.  First, "[w]hen the 
intervening statute authorizes or affects the propriety of 
prospective relief, application of the new provision is not 
retroactive."  Id.  Second, the Supreme Court has 
regularly applied intervening statutes conferring or 
ousting jurisdiction, whether or not jurisdiction lay 
when the underlying conduct occurred or when the suit 
was filed. . . .  Present law normally governs in such 
situations because jurisdictional statutes "speak to 
the power of the court rather than to the rights or 
obligations of the parties."  
 Id. at 274 (citation omitted).  Third,  
[c]hanges in procedural rules may often be applied in 
suits arising before their enactment without raising 
concerns about retroactivity. . . .  Because rules of 
procedure 
regulate 
secondary 
rather 
than 
primary 
conduct, the fact that a new procedural rule was 
instituted after the conduct giving rise to the suit 
does not make application of the rule at trial 
retroactive.  
Id. at 275 (citation omitted). 
No.  2015AP179.akz 
 
13 
 
¶137 The 
Supreme 
Court 
has 
at 
least 
implicitly 
characterized a "vested right" as "an immediate fixed right of 
present or future enjoyment."  Fernandez-Vargas, 548 U.S. at 44 
n.10 (quoting Pearsall v. Great N. Ry. Co., 161 U.S. 646, 673 
(1896)).  
[R]ights are vested, in contradistinction to being 
expectant or contingent. They are vested when the 
right to enjoyment, present or prospective, has become 
the property of some particular person or persons, as 
a present interest.  They are expectant when they 
depend upon the continued existence of the present 
condition of things until the happening of some future 
event.  They are contingent when they are only to come 
into existence on an event or condition which may not 
happen or be performed until some other event may 
prevent their vesting. 
Pearsall, 161 U.S. at 673 (internal quotation marks omitted) 
(citation omitted). 
¶138 The concept of vested rights is at issue in this case 
because "every statute, which takes away or impairs vested 
rights 
acquired 
under 
existing 
laws, 
or 
creates 
a 
new 
obligation, imposes a new duty, or attaches a new disability, in 
respect to transactions or considerations already past, must be 
deemed retrospective."  Landgraf, 511 U.S. at 269 (quoting 
Society for Propagation of the Gospel v. Wheeler, 22 F. Cas. 
756, 767 (C.C.N.H. 1814) (No. 13,156) (Story, Circuit Justice) 
(emphases added)). 
¶139 Thus, in cases involving retroactive legislation, 
courts may examine whether a party has a "vested right" that 
would be impaired by application of a statute in order to 
"determine whether application of the statute[] in question to 
the party challenging the statute actually has a retroactive 
No.  2015AP179.akz 
 
14 
 
effect."  Society Ins. v. LIRC, 2010 WI 68, ¶29, 326 
Wis. 2d 444, 786 N.W.2d 385; see also Barbara B. v. Dorian H., 
2005 WI 6, ¶20, 277 Wis. 2d 378, 690 N.W.2d 849; Matthies v. 
Positive Safety Mfg. Co., 2001 WI 82, ¶¶19, 23, 244 Wis. 2d 720, 
628 N.W.2d 842.10  If a statute has retroactive effect, the 
presumption against retroactivity becomes relevant.  Landgraf, 
511 U.S. at 280. 
¶140 But, 
again, 
when 
the 
legislature 
unambiguously 
establishes that a law applies to conduct which has already 
occurred, the presumption against retroactivity is no longer 
relevant; 
courts 
must 
simply 
apply 
the 
words 
of 
the  
legislature——even if the statute has retroactive effect——unless 
they violate some constitutional stricture.  See id. at 267, 273 
("[W]e have recognized that, in many situations, a court should 
                                                 
10 This application of the vested rights concept should not 
be confused with statements in some of our earlier cases that 
"[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.'"  State ex rel. Briggs & Stratton Corp. 
v. Noll, 100 Wis. 2d 650, 656, 302 N.W.2d 487 (1981) (citation 
omitted), overruled by Neiman v. Am. Nat. Prop. & Cas. Co., 2000 
WI 83, 236 Wis. 2d 411, 613 N.W.2d 160.  We have since changed 
course, explaining that "[t]o the extent the language in prior 
holdings 
implies 
that 
identifying 
a 
'vested' 
right 
is 
dispositive in determining whether a clearly retroactive statute 
is constitutional, that language is overruled."  Neiman, 236 
Wis. 2d 411, ¶14.   
I note that many prior cases of the Supreme Court in the 
field of retroactive legislation were determined "during an era 
characterized by exacting review of economic legislation under 
an approach that 'has long since been discarded.'"  United 
States v. Carlton, 512 U.S. 26, 34 (1994) (citation omitted). 
No.  2015AP179.akz 
 
15 
 
'apply the law in effect at the time it renders its decision,' 
even though that law was enacted after the events that gave rise 
to the suit.  There is, of course, no conflict between that 
principle and a presumption against retroactivity when the 
statute in question is unambiguous" (citation omitted) (emphasis 
removed).); U. S. Fidelity, 209 U.S. at 314. 
¶141 This takes us to the final general consideration in 
cases involving retroactive legislation: what the Constitution 
has to say about legislation that is clearly retroactive in 
effect.  The Supreme Court of the United States addressed this 
precise topic earlier this year: 
[T]he restrictions that the Constitution places on 
retroactive legislation "are of limited scope":  
The Ex Post Facto Clause flatly prohibits 
retroactive 
application 
of 
penal 
legislation.  Article I, § 10, cl. 1, 
prohibits 
States 
from 
passing . . . laws 
"impairing the Obligation of Contracts."  
The 
Fifth 
Amendment's 
Takings 
Clause 
prevents 
the 
Legislature 
(and 
other 
government actors) from depriving private 
persons of vested property rights except for 
a "public use" and upon payment of "just 
compensation."  The prohibitions on "Bills 
of Attainder" in Art. I, §§ 9–10, prohibit 
legislatures from singling out disfavored 
persons and meting out summary punishment 
for past conduct.  The Due Process Clause 
also protects the interests in fair notice 
and repose that may be compromised by 
retroactive 
legislation; 
a 
justification 
sufficient 
to 
validate 
a 
statute's 
prospective application under the Clause 
"may not suffice" to warrant its retroactive 
application.   
"Absent 
a 
violation 
of 
one 
of 
those 
specific 
provisions," when a new law makes clear that it is 
retroactive, the arguable "unfairness of retroactive 
No.  2015AP179.akz 
 
16 
 
civil legislation is not a sufficient reason for a 
court to fail to give [that law] its intended scope." 
Bank Markazi v. Peterson, 578 U.S. ___, 136 S. Ct. 1310, 1324-25 
(2016) (quoting Landgraf, 511 U.S. at 266-68).  
¶142 The current case features due process and equal 
protection challenges to the putatively retroactive application 
of Wis. Stat. § 807.01(4) (2013-14).  Because of certain 
misapprehensions in the proceedings before this court and in the 
proceedings that occurred in a similar case involving the same 
basic issues, namely Johnson, I will next discuss the applicable 
framework for analysis of these claims. 
III.  DUE PROCESS CHALLENGES TO RETROACTIVE LEGISLATION 
¶143 The Fourteenth Amendment to the federal constitution 
provides in part that no state shall "deprive any person of 
life, liberty, or property, without due process of law."  U.S. 
Const. amend. XIV, § 1. 
¶144 The Due Process Clause "imposes procedural limitations 
on a State's power to take away protected entitlements."  
District Attorney's Office for Third Judicial Dist. v. Osborne, 
557 U.S. 52, 67 (2009) (emphasis added) (citation omitted).  
Thus, for instance, the amendment requires "that deprivation of 
life, liberty or property by adjudication be preceded by notice 
and opportunity for hearing appropriate to the nature of the 
case."  Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 
306, 313 (1950). 
¶145 The Due Process Clause has also been interpreted to 
possess a "substantive component . . . that protects individual 
liberty against 'certain government actions regardless of the 
No.  2015AP179.akz 
 
17 
 
fairness of the procedures used to implement them.'"  Collins v. 
Harker Heights, Tex., 503 U.S. 115, 125 (1992) (emphases added) 
(citation omitted).  
¶146 Lands' End is not, apparently, arguing that the 
procedures by which the State has (putatively) deprived it of 
life, liberty or property——here, the enactment of a law by the 
legislative and executive branches of our state government——were 
constitutionally 
inadequate. 
 
Cf. 
Missouri 
v. 
Jenkins, 
495 U.S. 33, 66 (1990) (Kennedy, J., concurring in part and 
concurring in the judgment) ("[C]itizens who are taxed [by a 
legislature] are given notice and a hearing through their 
representatives, whose power is a direct manifestation of the 
citizens' consent."); Atkins v. Parker, 472 U.S. 115, 129-30 
(1985) ("[A] welfare recipient is not deprived of due process 
when the legislature 
adjusts benefit levels . . . . [T]he 
legislative determination provides all the process that is due" 
(citation omitted).). 
¶147 Instead, 
Lands' 
End 
contends 
that 
the 
federal 
constitution prohibits the legislature from taking the type of 
action that it did regardless of any procedural protections; 
that is, Lands' End argues that application to it of the 
amendments to Wis. Stat. § 807.01(4) is unconstitutional no 
matter how the alleged deprivation is implemented.  This is a 
substantive due process claim.  See Barbara B., 277 Wis. 2d 378, 
¶18 n.14 ("[Petitioner] is not arguing that the procedure 
applied in his case was unfair.  Instead, he is arguing that it 
is unfair to apply [the statute] retroactively because he 
No.  2015AP179.akz 
 
18 
 
believes that it is wrong to apply those substantive rules to 
his case in light of the law that he alleges had previously been 
in place.  Thus, it appears that [petitioner] is asserting a 
substantive due process claim, rather than a procedural due 
process claim" (citation omitted).); United States v. Carlton, 
512 U.S. 26, 39-42 (1994) (Scalia, J., concurring) (framing 
retroactive tax legislation case as one involving substantive 
due process); Pension Ben. Guar. Corp. v. R. A. Gray & Co., 467 
U.S. 717, 731-32 (1984) ("We have doubts . . . that retroactive 
application of the [statute] would be invalid under the Due 
Process Clause for lack of notice even if it was suddenly 
enacted 
by 
Congress 
without 
any 
period 
of 
deliberate 
consideration, as often occurs with floor amendments or 'riders' 
added at the last minute to pending legislation."); James L. 
Kainen, The Historical Framework for Reviving Constitutional 
Protection for Property and Contract Rights, 79 Cornell L. Rev. 
87, 112 (1993) ("Questions of retroactive law are essentially 
questions 
of 
substantive 
due 
process . . ." 
(citation 
omitted).); cf. Reno v. Flores, 507 U.S. 292, 302 (1993) 
(substantive due process "forbids the government to infringe 
certain 'fundamental' liberty interests at all, no matter what 
process is provided, unless the infringement is narrowly 
tailored to serve a compelling state interest."). 
¶148 The federal constitution's guarantee of "substantive" 
due process "provides heightened protection against government 
interference 
with 
certain 
fundamental 
rights 
and 
liberty 
interests."  Washington v. Glucksberg, 521 U.S. 702, 719-20 
No.  2015AP179.akz 
 
19 
 
(1997) (citation omitted).  The United States Supreme Court has 
determined that these rights include, for example, the rights to 
have children and to direct the education and upbringing of 
one's children.  Id. at 720.  If a fundamental liberty interest 
is identified, any infringement on it by the government must be 
"narrowly tailored to serve a compelling state interest."  
Flores, 507 U.S. at 302.  If fundamental rights and liberties 
are not at stake, however, the federal constitution requires 
only that a challenged law "be rationally related to legitimate 
government interests," Glucksberg, 521 U.S. at 728——that is, 
neither "arbitrary" nor "irrational."  Usery v. Turner Elkhorn 
Mining Co., 428 U.S. 1, 15 (1976); see also Smith, 323 
Wis. 2d 377, ¶12; Flores, 507 U.S. at 305. 
¶149 For example, the Supreme Court has determined that, 
unlike statutes pertaining to fundamental rights, "legislative 
Acts adjusting the burdens and benefits of economic life" are 
subject only to the "arbitrary and irrational" standard of 
review.  Pension Ben. Guar. Corp., 467 U.S. at 729; Usery, 428 
U.S. at 15. 
¶150 Lands' End does not argue that a fundamental right or 
liberty is at stake.  Instead, it claims that Wis. Stat. 
§ 807.01(4) (2013-14) unconstitutionally impairs its "vested" 
right in the 12 percent interest rate provided under Wis. Stat. 
§ 807.01(4) (2009-10).  The idea behind Lands' End's argument is 
that, as it relied on the 12 percent interest rate in effect 
when it made its offer of settlement to the City of Dodgeville, 
the legislature may not apply a lower interest rate in Lands' 
No.  2015AP179.akz 
 
20 
 
End's case now that Lands' End has obtained a judgment in its 
favor above the amount of its earlier settlement offer.  To do 
so, the argument presumably runs, would be to "deprive [Lands' 
End] of . . . property, without due process of law."  U.S. 
Const. amend. XIV, § 1; see also Pearsall, 161 U.S. at 673 
("[Rights] are vested when the right to enjoyment, present or 
prospective, has become the property of some particular person 
or persons, as a present interest" (citation omitted).); Society 
Ins., 326 Wis. 2d 444, ¶30 (referring to "vested property 
right[s]" in case involving due process challenge to retroactive 
legislation).  
¶151 As stated, there is no contention that the present 
case involves fundamental rights or interests.  Thus, we would 
expect that even if Lands' End could be said to possess a vested 
property right in a 12 percent interest rate on the judgment it 
recovered, explicit abrogation of that right by the legislature 
would be subject to rational basis review.  And in fact, this is 
exactly what relevant case law provides.  The Supreme Court has 
stated:  
Provided that the retroactive application of a statute 
is supported by a legitimate legislative purpose 
furthered by rational means, judgments about the 
wisdom of such legislation remain within the exclusive 
province of the legislative and executive branches:  
[O]ur 
cases 
are 
clear 
that 
legislation 
readjusting 
rights 
and 
burdens 
is 
not 
unlawful solely because it upsets otherwise 
settled expectations.  This is true even 
though the effect of the legislation is to 
impose a new duty or liability based on past 
acts. 
No.  2015AP179.akz 
 
21 
 
To 
be 
sure, 
we 
[have] 
recognize[d] 
that 
retroactive legislation does have to meet a burden not 
faced by legislation that has only future effects.  
"It does not follow . . . that what Congress can 
legislate 
prospectively 
it 
can 
legislate 
retrospectively. 
 
The 
retroactive 
aspects 
of 
legislation, as well as the prospective aspects, must 
meet the test of due process, and the justifications 
for the latter may not suffice for the former."  But 
that burden is met simply by showing that the 
retroactive application of the legislation is itself 
justified by a rational legislative purpose. 
Pension Ben. Guar. Corp., 467 U.S. at 729-30 (citations 
omitted).  
¶152 Similarly, in Society Insurance we emphasized that, 
unlike in cases involving challenges based on the contract 
clauses of the federal and state constitutions, "we review a due 
process challenge to retroactive legislation under a rational 
basis review."  Society Ins., 326 Wis. 2d 444, ¶30 n.12 
(citation omitted).  We made clear: "[R]equiring a showing of a 
'significant and legitimate public purpose' in the course of a 
due process challenge improperly subjects the retroactive 
legislation to a heightened level of scrutiny.  Retroactive 
legislation must be 'justified by a rational legislative 
purpose.'"  Id. (citing Pension Ben. Guar. Corp., 467 U.S. at 
730).11  
¶153 Unfortunately, despite the fact that rational basis 
review generally requires only that the law under review be 
"rationally related to a 
legitimate legislative purpose," 
                                                 
11 As will be discussed below, the Johnson court erroneously 
stated that the "significant and legitimate" standard was 
applicable 
to 
a 
due 
process 
challenge 
to 
retroactive 
legislation.  Johnson, 360 Wis. 2d 350, ¶15. 
No.  2015AP179.akz 
 
22 
 
Carlton, 512 U.S. at 35——a test that can be employed with 
minimum worry about judicial subjectivity——a less defensible and 
extremely subjective "balancing test" has wormed its way into 
our case law.  In Matthies, for instance, we stated, "Whether 
there exists a rational basis [in retroactive legislation cases] 
involves weighing the public interest served by retroactively 
applying 
the 
statute 
against 
the 
private 
interest 
that 
retroactive application of the statute would affect."  Matthies, 
244 Wis. 2d 720, ¶27.  
¶154 The validity of this balancing test is questionable, 
as becomes apparent when one traces the test's genesis.  The 
test seemingly appeared in Wisconsin law in our decision in 
Martin v. Richards, 192 Wis. 2d 156, 201, 531 N.W.2d 70 (1995).   
¶155 The Martin court, in turn, lifted the balancing test 
from a First Circuit case, Adams Nursing Home of Williamstown, 
Inc. v. Mathews, 548 F.2d 1077 (1st Cir. 1977).  Martin, 192 
Wis. 2d at 201.  Adams Nursing Home was decided prior to 
relevant Supreme Court case law on the topic, such as Pension 
Benefit, see supra, ¶151, and cited, for its own principle 
authority, a then-17-year-old law review article.  See Adams 
Nursing Home, 548 F.2d at 1080 (citations omitted).  The author 
of the article states: 
[W]hen one considers the great variety of [the Supreme 
Court's retroactive legislation] cases, it becomes 
clear that no one factor is sufficient to explain the 
results which the Court has reached.  Rather it is 
submitted that the constitutionality of such a statute 
is determined by three major factors, each of which 
must be weighed in any particular case. 
No.  2015AP179.akz 
 
23 
 
Charles B. Hochman, The Supreme Court and the Constitutionality 
of Retroactive Legislation, 73 Harv. L. Rev. 692, 696-97 
(1960).12  
                                                 
12 The Adams Nursing Home court also cited, as indirect 
authority for its balancing test, Usery v. Turner Elkhorn Mining 
Co., 428 U.S. 1 (1976), and S. Terminal Corp. v. E.P.A., 504 
F.2d 646, 680 (1st Cir. 1974).  Adams Nursing Home of 
Williamstown, Inc. v. Mathews, 548 F.2d 1077, 1080-81 (1st Cir. 
1977) (citations omitted).  Neither provides strong support for 
the balancing test currently employed in this court's vested 
rights jurisprudence.  The discussion in South Terminal cited by 
the Adams Nursing Home court, for example, involves a Contracts 
Clause challenge.  S. Terminal, 504 F.2d at 680.  Usery does not 
explicitly 
discuss 
a 
balancing 
test 
and 
suggests 
that 
rationality is the important yardstick.  See Usery, 428 U.S. at 
15, 19 ("It is by now well established that legislative Acts 
adjusting the burdens and benefits of economic life come to the 
Court with a presumption of constitutionality, and that the 
burden is on one complaining of a due process violation to 
establish that the legislature has acted in an arbitrary and 
irrational way.").  In any event, Usery was published prior in 
time to Pension Benefit Guaranty Corp. v. R. A. Gray & Co., 467 
U.S. 717 (1984). 
The Martin court also provided by way of footnote certain 
"examples of decisions" using the balancing test, namely Usery, 
Chappy v. LIRC, 136 Wis. 2d 172, 192-94, 401 N.W.2d 568 (1987), 
and State ex rel. Briggs & Stratton v. Noll, 100 Wis. 2d 650, 
656-58, 302 N.W.2d 487 (1981), overruled by Neiman v. American 
National Prop. & Cas. Co., 2000 WI 83, 236 Wis. 2d 411, 613 
N.W.2d 160, but these latter two cases are no more convincing.  
Martin v. Richards, 192 Wis. 2d 156, 201 n.8, 531 N.W.2d 70 
(1995) (citations omitted).  Chappy applies the rational basis 
test and does not discuss any balancing test.  See Chappy, 136 
Wis. 2d at 192.  Noll in fact stated that any retrospective law 
that 
impairs 
vested 
rights 
acquired 
under 
prior 
law 
is 
unconstitutional, and was overruled in that respect by this 
court's decision in Neiman.  Noll, 100 Wis. 2d at 656, overruled 
by Neiman, 236 Wis. 2d 411, ¶14. 
(continued) 
No.  2015AP179.akz 
 
24 
 
¶156 That the balancing test used by this court in 
retroactive legislation cases has a questionable pedigree might 
not be so problematic were it not for the fact that it is 
illogical 
to 
suggest 
that 
a 
legislative 
goal 
is 
simply 
irrational whenever "the private interest that retroactive 
application of [a] statute would affect" is adjudged to be 
"weigh[tier]"——even if by only a hair——than "the public interest 
served by retroactively applying the statute."  Matthies, 244 
Wis. 2d 720, ¶27.  Such a judgment itself recognizes that there 
is some (rational) "public interest" served by retroactively 
applying the statute.  In cases where the public and private 
interests are both "weighty," it would be incredibly difficult 
to apply the test objectively.  
¶157 Simply stated, the proper test to be applied is the 
rational basis test.  To the extent that the court has 
previously engaged in the balancing test to determine whether a 
rational basis exists for retroactive application of a statute, 
we should recognize that it is really not a balancing test at 
all.  At most, a statute might be found not to be rationally 
                                                                                                                                                             
Martin's decision to adopt use of a balancing test is 
perplexing; it even refers to both Usery and Pension Benefit in 
the paragraph immediately preceding its citation to Adams 
Nursing Home.  As discussed, Pension Benefit (and Usery, for 
that matter) makes clear that retroactive application of a 
statute need only be "supported by a legitimate legislative 
purpose furthered by rational means" to survive due process 
challenge.  Pension Ben. Guar. Corp., 467 U.S. at 729.  Martin 
neglected to cite this portion of Pension Benefit.  The word 
"rational" appears only once in Martin, in an unrelated context.  
Martin, 192 Wis. 2d at 173. 
No.  2015AP179.akz 
 
25 
 
based or to be "irrational" pursuant to the court's due process 
"balancing test" only if there were virtually no conceivable 
public interest served by retroactive application of the 
legislation under review.  The rational basis test is not 
whether, on balance, a private interest outweighs the public 
interest.  The rational basis test is not simply picking whether 
the interests of one group are more important than the other.  
Those are legislative determinations that are not subject to 
this court's balancing.  See, e.g., Smith, 323 Wis. 2d 377, ¶17 
(citing Supreme Court's characterization of rational basis 
review as "a paradigm of judicial restraint" in FCC v. Beach 
Commc'ns, Inc., 508 U.S. 307, 314 (1993)); Flynn v. DOA, 216 
Wis. 2d 521, 539, 576 N.W.2d 245 (1998) ("This court has long 
held that it is the province of the legislature, not the courts, 
to determine public policy.").  That is the only way to 
reconcile (1) our due process requirement that retroactive 
legislation need only be justified by a rational legislative 
purpose; with (2) our due process requirement that the public 
interest served by retroactive application of a statute outweigh 
the private interest affected by retroactive application of a 
statute.  See Society Ins., 326 Wis. 2d 444, ¶¶30, 53.  There 
may be an implicit recognition of the relevant analysis not 
being a balancing test but instead being a straightforward 
application of the rational basis test in certain of our cases.  
See, e.g. Martin, 192 Wis. 2d at 211 ("[T]he record reveals 
minimal, if any, public interest served by applying the cap on 
noneconomic damages retroactively" (emphasis added).); Matthies, 
No.  2015AP179.akz 
 
26 
 
244 Wis. 2d 756, ¶47 ("[T]he substantial impairment of Matthies' 
right to recovery significantly outweighs the public interest, 
if any, served by retroactive application of [Wis. Stat.] 
§ 895.045(1)" (emphasis added).). 
¶158 There also seems to be implicit recognition of this 
fact in Supreme Court case law.  In Pension Benefit, the Supreme 
Court acknowledged a four-part test applied by the Seventh 
Circuit "for reviewing the constitutionality of retroactive 
legislation under the Fifth Amendment's Due Process Clause."  
Pension Ben. Guar. Corp., 467 U.S. at 727 & n.6.  One part of 
that test required consideration of "the equities of imposing 
the legislative burdens."  Id. at 727.  The Court stated, 
"We . . . reject 
the 
constitutional 
underpinnings 
of 
the 
analysis employed by the Court of Appeals . . . , although we 
have no occasion to consider whether the factors mentioned by 
that 
court 
might 
in 
some 
circumstances 
be 
relevant 
in 
determining whether retroactive legislation is rational."  Id. 
at 727 n.6 (emphases added).  The Supreme Court thus clarified 
that the paramount constitutional question in cases involving 
retroactive legislation is the statute's rationality.  See also 
Pension Ben. Guar. Corp., 467 U.S. at 733 ("[A]lthough we have 
noted that retrospective civil legislation may offend due 
process if it is 'particularly "harsh and oppressive,"' that 
standard does not differ from the prohibition against arbitrary 
and irrational legislation that we clearly enunciated in 
[Usery]" (citations omitted).).  
No.  2015AP179.akz 
 
27 
 
¶159 It is not as though the Supreme Court has always 
categorically ignored consideration of the relative equities in 
conducting due process analyses of retroactive legislation.  
See, e.g., Usery, 428 U.S. at 18 (discussing plaintiffs' 
arguments 
that 
retroactive 
liability 
would 
be 
unfair).  
Ultimately, however, any application of a non-constitutional 
balancing test must at most be in service of determination of 
the question of a statute's rationality.  See id. at 19 
(rejecting unfairness arguments and stating, "It is enough to 
say that the Act approaches the problem of cost spreading 
rationally; whether a broader cost-spreading scheme would have 
been wiser or more practical under the circumstances is not a 
question 
of 
constitutional 
dimension" 
(citation 
omitted) 
(emphasis added).). 
¶160 Thus, 
while 
I 
would 
not 
necessarily 
foreclose 
consideration of the relative equities, a mere balancing of the 
relative equities is not the test.  "Statutes may be invalidated 
on due process grounds only under the most egregious of 
circumstances."  E. Enters. v. Apfel, 524 U.S. 498, 550 (1998) 
(Kennedy, J., concurring in the judgment and dissenting in 
part).  Consequently, to the extent that there is any balancing 
employed in the context of retroactive legislation, the question 
asked under the rational basis test must be whether "the private 
interest that retroactive application of the statute would 
affect" is so much "weigh[tier]" than  "the public interest 
served by retroactively applying the statute," Matthies, 244 
Wis. 2d 720, ¶27, that the statute could only be characterized 
No.  2015AP179.akz 
 
28 
 
as "arbitrary or irrational."  Smith, 323 Wis. 2d 377, ¶11.  
Quite obviously, this "arbitrary or irrational" determination is 
likely in only the rarest of cases, where essentially no genuine 
public interest can be said to exist.  See also The American 
Heritage Dictionary of the English Language 94 (3d ed. 1992) 
(defining "arbitrary" in part as follows: "1. Determined by 
chance, whim, or impulse, and not by necessity, reason, or 
principle . . . 2. Based on or subject to individual judgment or 
preference."). 
¶161 Rationality may seem a low bar.  And, indeed, the 
Supreme Court has repeatedly determined that it is, in upholding 
retroactive legislation against due process challenges.  See, 
e.g., Pension Ben. Guar. Corp., 467 U.S. at 725 (retroactive 
application of statute requiring employers withdrawing from a 
multiemployer pension plan to "pay a fixed and certain debt to 
the pension plan," such that certain employer withdrawing from 
the plan prior to enactment of the statute was liable in amount 
of $201,359, held constitutional); Usery, 428 U.S. at 5-6, 14, 
19-20 (retroactive application of statute requiring coal mine 
operators to compensate miners disabled by black lung disease, 
such that certain operators were obligated to compensate miners 
who had already left employment prior to enactment of the 
statute, held constitutional); Cf. Carlton, 512 U.S. at 28-29, 
35 (retroactive application of statute treating earlier, newly-
established estate tax deduction as available only to certain 
estates, such that estate which spent $631,000 in order to use 
No.  2015AP179.akz 
 
29 
 
deduction to reduce estate tax by $2,501,161 before enactment of 
the statute could not use deduction, held constitutional).  
¶162 On the other hand, there is nothing particularly 
surprising about the fact that precedent requires that the 
constitutional guarantee of "substantive due process" provides 
only modest protection in cases not involving fundamental 
rights.  See, e.g., Flores, 507 U.S. at 302-03.  Additionally, 
and importantly, to say that the due process clause does not 
prohibit application of retroactive legislation does not mean 
that such legislation automatically survives attack based on 
other constitutional provisions.  See, e.g., E. Enters., 524 
U.S. at 522, 532-37 (plurality) (retroactive statute effected an 
unconstitutional taking in violation of Fifth Amendment Takings 
Clause). 
IV.  EQUAL PROTECTION CHALLENGES TO RETROACTIVE LEGISLATION 
¶163 As discussed, a due process challenge to retroactive 
legislation is somewhat different than a due process challenge 
to prospective legislation.  "It does not follow . . . that what 
Congress 
can 
legislate 
prospectively 
it 
can 
legislate 
retrospectively.  The retroactive aspects of legislation, as 
well as the prospective aspects, must meet the test of due 
process, and the justifications for the latter may not suffice 
for the former."  Pension Ben. Guar. Corp., 467 U.S. at 730 
(citation omitted).  In contrast, an equal protection challenge 
to retroactive legislation cases seemingly would be remarkably 
similar, if not identical to such challenges in cases involving 
only prospective legislation: in both types of cases, courts 
No.  2015AP179.akz 
 
30 
 
must 
examine 
the 
legislature's 
classifications 
under 
the 
appropriate 
standard 
of 
review. 
 
See, 
e.g., 
Smith, 
323 
Wis. 2d 377, ¶¶12-13, 15-17.  Thus, in summarizing the various 
restrictions 
that 
the 
Constitution 
places 
on 
retroactive 
legislation in Bank Markazi, see supra ¶141, the Supreme Court 
makes no mention of the Equal Protection Clause of the 
Fourteenth Amendment.  See Bank Markazi, 136 S. Ct. at 1324-25 
(citation omitted).  This is likely not because the Equal 
Protection Clause provides no protection in this area of law, 
but because it provides no special protection in this area of 
the law.  In both types of cases——those involving prospective 
application of a law and those involving retroactive application 
of a law——courts must determine whether the legislature has 
complied with the "general rule that States must treat like 
cases alike but may treat unlike cases accordingly."  Vacco v. 
Quill, 521 U.S. 793, 799 (1997) (citation omitted).13  
¶164 Lands' End argues that application to it of Wis. Stat. 
§ 807.01(4) (2013-14) denies it the equal protection of the laws 
because it "treat[s] differently, without rational basis, the 
class of plaintiffs who commenced actions, made offers of 
settlement, and obtained a final judgment prior to the passage 
of Act 69 from those obtaining [judgment] after the passage of 
Act 69." 
                                                 
13 At the very least, the parties have not suggested that 
the equal protection analysis conducted in the context of 
retroactive legislation is different than that conducted in the 
context of prospective legislation. 
No.  2015AP179.akz 
 
31 
 
¶165 Because Lands' End does not argue that a fundamental 
right or suspect class is at issue, rational basis review is the 
level of judicial scrutiny applicable to Lands' End's equal 
protection challenge to Wis. Stat. § 807.01(4) (2013-14).  See 
United States v. Sperry Corp., 493 U.S. 52, 65 (1989); State v. 
Alger, 2015 WI 3, ¶39, 360 Wis. 2d 193, 858 N.W.2d 346.  
Legislation is upheld under rational basis review "unless it is 
'patently arbitrary' and bears no rational relationship to a 
legitimate government interest."  Alger, 360 Wis. 2d 193, ¶39 
(citation omitted). 
¶166 With the relevant principles and analytical frameworks 
in place, I proceed to analyze Lands' End's claims.  I note that 
my remaining analysis largely tracks the analysis presented in 
the lead opinion. 
 
V.  WHETHER WIS. STAT. § 807.01(4) (2013-14)  
APPLIES RETROACTIVELY 
¶167 Wisconsin Stat. § 807.01(4) (2013-14) states: 
If there is an offer of settlement by a party 
under this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at an annual rate equal 
to 1 percent plus the prime rate in effect on January 
1 of the year in which the judgment is entered if the 
judgment is entered on or before June 30 of that year 
or in effect on July 1 of the year in which the 
judgment is entered if the judgment is entered after 
June 30 of that year, as reported by the federal 
reserve board in federal reserve statistical release 
H. 15, on the amount recovered from the date of the 
offer 
of 
settlement 
until 
the 
amount 
is 
paid.  
Interest under this section is in lieu of interest 
computed under ss. 814.04 (4) and 815.05 (8). 
Wis. Stat. § 807.01(4) (2013-14). 
No.  2015AP179.akz 
 
32 
 
¶168 Consistent with the above discussion, the first step 
in analyzing Lands' End's claims against Wis. Stat. § 807.01(4) 
(2013-14) is to determine whether the legislature has "expressly 
prescribed the statute's proper reach," because if it has done 
so, the statute is applied as written and the presumption 
against retroactivity is ignored.  Landgraf, 511 U.S. at 280.  
As the lead opinion explains, it is simply not clear whether 
Wis. Stat. § 807.01(4) (2013-14) applies to conduct preceding 
the statute's enactment.  Lead op., ¶46. 
¶169 2011 
Wis. 
Act 
69 
does 
contain 
an 
"Initial 
Applicability" section, see 2011 Wis. Act 69, § 4, but it is 
unhelpful here.  The section states, "This act first applies to 
an execution on a judgment entered on the effective date of this 
subsection."  Id.  A federal court has interpreted this language 
"to mean that the applicable interest rate is determined by the 
date judgment is entered."  James Michael Leasing Co. v. Paccar, 
Inc., No. 11-C-0747, 2013 WL 5771156, at *2 (E.D. Wis. Oct. 24, 
2013), aff'd, 772 F.3d 815 (7th Cir. 2014).  However, while the 
legislature could have written, "This act first applies to a 
judgment entered on the effective date of this statute," it did 
not do so.  Lands' End contends, and the City does not dispute 
this fact, that it will never obtain execution on a judgment in 
this case.  See, e.g., Wis. Stat. § 815.02 (2013-14) ("A 
judgment which requires the payment of money or the delivery of 
property may be enforced in those respects by execution.").  The 
effect of the initial applicability section of 2011 Wis. Act 69 
on this case is, at best, unclear.  
No.  2015AP179.akz 
 
33 
 
¶170 Further, 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
itself 
contains no indication regarding the "temporal reach" of the 
statute.  Fernandez-Vargas, 548 U.S. at 37; see Wis. Stat. 
§ 807.01(4) (2013-14).  
¶171 Thus, 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
must 
be 
assessed in order to ascertain whether it has retroactive 
effect; if it does, the presumption against retroactivity is 
applied because the statute does not otherwise indicate its 
temporal reach.  Landgraf, 511 U.S. at 270.  I agree with the 
lead opinion that Wis. Stat. § 807.01(4) (2013-14) does not have 
retroactive effect.  See lead op., ¶82. 
¶172 Lands' End argues that application of Wis. Stat. 
§ 807.01(4) (2013-14) to it would disturb its vested right.  But 
both the original and the amended versions of Wis. Stat. 
§ 807.01(4) require both an unaccepted offer of settlement and 
recovery of a judgment greater than or equal to the amount 
specified in the offer of settlement in order for a particular 
interest rate to be applied.  Lands' End only fulfilled one of 
these requirements before the statute was amended.  
¶173 At the time that Lands' End made an offer of 
settlement to the City, it had no "vested" right to anything——it 
had no "immediate fixed right of present or future enjoyment."  
See Fernandez-Vargas, 548 U.S. at 44 n.10.  It could not have 
enforced a claim to 12 percent interest; any court would have 
required recovery of a judgment greater than or equal to the 
amount contained in the offer of settlement.  Lands' End instead 
possessed a contingent right.  Rights are contingent, as opposed 
No.  2015AP179.akz 
 
34 
 
to vested, "when they are only to come into existence on an 
event or condition which may not happen or be performed until 
some other event may prevent their vesting."  Pearsall, 161 U.S. 
at 673 (citation omitted).  When Lands' End made an offer of 
settlement to the City, it was possible that Lands' End might go 
on to recover a judgment.  Alternately, it was possible that 
"some other event [could] prevent [the] vesting" of its 
contingent right to 12 percent interest——for instance, Lands' 
End might have lost the case, or the City might have accepted 
its settlement offer, or Lands' End might have won the case but 
recovered a judgment less than the amount contained in its 
earlier offer of settlement.  The fact that the legislature 
changed the applicable interest rate prior to the vesting of 
Lands' End's contingent right might seem unfair, but it is not a 
retroactive application of a new law.  "[A] statute 'is not made 
retroactive merely because it draws upon antecedent facts for 
its operation.'"  Landgraf, 511 U.S. at 269 n.24.  
¶174 The argument that Lands' End's right to a 12 percent 
interest rate is vested because that rate was in effect when it 
calculated an appropriate offer of settlement ignores the fact 
that Lands' End could have factored into its calculation the 
possibility that the interest rate might change.  Cf. Carlton, 
512 U.S. at 34 (stating, in regard to due process challenge to 
retroactive tax legislation, "we do not consider respondent 
Carlton's lack of notice regarding the 1987 amendment to be 
dispositive. . . .  [A] taxpayer 'should be regarded as taking 
his chances of any increase in the tax burden which might result 
No.  2015AP179.akz 
 
35 
 
from carrying out the established policy of taxation'" (citation 
omitted).). 
 
Besides, 
"[a] 
statute 
does 
not 
operate 
'retrospectively' merely because it . . . upsets expectations 
based in prior law."  Landgraf, 511 U.S. at 269.  For instance, 
[e]ven 
uncontroversially 
prospective 
statutes 
may 
unsettle expectations and impose burdens on past 
conduct: a new property tax or zoning regulation may 
upset the reasonable expectations that prompted those 
affected to acquire property; a new law banning 
gambling harms the person who had begun to construct a 
casino before the law's enactment or spent his life 
learning to count cards. 
Id. at 269 n.24. 
¶175 More generally——and apart from the vested rights 
question——determining whether a statute has retroactive effect 
requires a "commonsense, functional judgment" regarding 'whether 
the new provision attaches new legal consequences to events 
completed before its enactment.'"  Hadix, 527 U.S. at 357-58 
(citation omitted).  Wisconsin Stat. § 807.01(4) (2013-14) did 
not change the legal consequences of any events completed prior 
to that statute's enactment.  At most, Lands' End can point to 
its offer of settlement, but an offer of settlement alone 
produces no "legal consequences" (at least, none relevant to the 
questions before us).  And while Lands' End may have possessed 
"expectations" regarding 12 percent interest, they were not 
"settled" for the reasons already discussed——Lands' End had not 
No.  2015AP179.akz 
 
36 
 
completed all that Wis. Stat. § 807.01(4) (2009-10) required.  
See Landgraf, 511 U.S. at 270.14  
¶176 Because Wis. Stat. § 807.01(4) (2013-14) does not 
apply retroactively in this case, there is no need to presume 
                                                 
14 Other than arguing that Wis. Stat. § 807.01(4) (2013-14) 
impairs a vested right, Lands' End does not develop arguments 
that may be read to explain why application of that statute to 
it is retroactive.  I am hesitant to develop these arguments for 
Lands' End.  I note that it is doubtful that the amendments to 
Wis. Stat. § 807.01(4) could be read to "attac[h] a new 
disability, in respect to transactions or considerations already 
past" under Justice Story's definition of retroactive laws.  
Vartelas v. Holder, 566 U.S. ___, 132 S. Ct. 1479, 1486-87 
(2012) (alteration in original) (citation omitted); see supra 
¶22.  Admittedly, this is a more complicated question than 
appears at first glance, especially without briefing.  See, 
e.g., Vartelas, 132 S. Ct. at 1487 (seemingly suggesting that 
severity of the effect of a statutory change affects whether an 
outcome "ranks as a 'new disability.'"); id. at 1495 (Scalia, 
J., dissenting) ("[T]he 'new disability in respect to past 
events' test provides no meaningful guidance.  I can imagine 
countless laws that . . . impose 'new disabilities' related to 
'past events' and yet do not operate retroactively."). 
As stated, prior to 2011 Wis. Act 69, only a litigant who 
had (among other things) recovered a judgment was entitled to a 
12 percent interest rate.  Thus, even if a reduced interest rate 
might be considered a "new disability," it "attaches" to post-
enactment conduct: the recovery of a judgment following an 
earlier, rejected offer of settlement.  See id. at 1489-90 & n.7 
(law prohibiting persons who have been adjudicated as a mental 
defective or who have been committed to a mental institution 
from possessing guns does not operate retroactively, as the law 
addresses a danger arising post-enactment, namely "mentally 
unstable persons purchasing guns").  2011 Wis. Act 69 did not 
attach a disability to pre-enactment conduct, namely offers of 
settlement, because these offers did not entitle the offeror to 
any specific interest rate.  It would be difficult to see why a 
contrary conclusion would not require a determination that 2011 
Wis. Act 69 also attached a "new disability" to those who had 
merely filed lawsuits prior to the law's enactment, which is as 
much of a prerequisite for fulfillment of Wis. Stat. § 807.01(4) 
(2013-14) as making an offer of settlement.   
No.  2015AP179.akz 
 
37 
 
that it applies prospectively——it does apply prospectively.15  
Lands' End never recovered a judgment prior to the enactment of 
Wis. Stat. § 807.01(4) (2013-14) and was thus never entitled to 
12 percent interest on such a judgment. 
 
VI.  WHETHER APPLICATION OF WIS. STAT. § 807.01(4) (2013-14) 
VIOLATES LANDS' END'S RIGHT TO DUE PROCESS OF LAW 
¶177 As stated, Wis. Stat. § 807.01(4) (2013-14) does not 
apply retroactively and does not impair a vested right possessed 
by Lands' End.  Lands' End rested its due process claim on the 
presence of an impaired vested right.  Indeed, it does not 
explain how, in the absence of a vested right, it is being 
"deprive[d] of life, liberty, or property, without due process 
of law."  U.S. Const. amend. XIV, § 1.  Thus, I need not assess 
its due process claim further.  See lead op., ¶82.16 
 
VII.  WHETHER APPLICATION OF WIS. STAT. § 807.01(4) (2013-14) 
DENIES LANDS' END THE EQUAL PROTECTION OF THE LAWS 
                                                 
15 The Johnson court concluded otherwise.  See, e.g., 
Johnson, 360 Wis. 2d 350, ¶27.  As explained, I concur in the 
lead opinion's decision to overrule Johnson.   
16 In conducting its due process analysis, the Johnson court 
erroneously stated that "[i]f retroactive legislation causes 
'substantial 
impairment 
of 
a 
vested 
right,' 
it 
is 
unconstitutional 
unless 
justified 
by 
a 
significant 
and 
legitimate public interest."  Johnson, 360 Wis. 2d 250, ¶15 
(citation omitted).  As discussed above, in Society Insurance v. 
Labor & Industry Review Comm'n, 2010 WI 68, 326 Wis. 2d 444, 786 
N.W.2d 385, 
we 
explained: 
"[R]equiring 
a 
showing 
of 
a 
'significant and legitimate public purpose' in the course of a 
due process challenge [to retroactive legislation] improperly 
subjects the retroactive legislation to a heightened level of 
scrutiny.  Retroactive legislation must be 'justified by a 
rational legislative purpose.'" Society Ins., 326 Wis. 2d 444, 
¶30 n.12.  
No.  2015AP179.akz 
 
38 
 
¶178 Lands' End does not argue that a fundamental right or 
suspect class is at issue, so rational basis applies to Lands' 
End's equal protection challenge to Wis. Stat. § 807.01(4) 
(2013-14).  See Sperry Corp., 493 U.S. at 65; Alger, 360 
Wis. 2d 193, ¶39.  Legislation is upheld under rational basis 
review "unless it is 'patently arbitrary' and bears no rational 
relationship to a legitimate government interest."  Alger, 360 
Wis. 2d 193, ¶39. 
¶179 The 
classification 
identified 
by 
Lands' 
End 
is 
rational.  The legislature needed to determine a cut-off point 
for application of the old 12 percent interest rate.  "[The 
legislature] could have rationally concluded that only those who 
are successful [in their litigation] realize a benefit therefrom 
sufficient to justify" prevention of application of the new 
interest rate.  Cf. Sperry Corp., 493 U.S. at 54, 65 (statute 
requiring "Federal Reserve Bank of New York to deduct and pay 
into the United States Treasury a percentage of any award made 
by the Iran–United States Claims Tribunal in favor of an 
American claimant before remitting the award to the claimant" 
did not violate equal protection by assessing a fee only against 
claimants who actually received an award, and not against all 
claimants).  In other words, the legislature may have thought, 
reasonably, that those who had already obtained a judgment prior 
to passage of 2011 Wis. Act 69 had a greater claim to the 12 
percent interest rate than did those who had simply made an 
offer but not obtained a judgment.  Application of the new 
interest rate to the former group might have been viewed as 
No.  2015AP179.akz 
 
39 
 
significantly more inequitable than application of the new 
interest rate to the latter group, since the latter group was 
still fully engaged in litigation with no guarantee of success. 
¶180 Moreover,  
[t]he problem of legislative classification is a 
perennial one, admitting of no doctrinaire definition.  
Evils in the same field may be of different dimensions 
and proportions, requiring different remedies.  Or so 
the legislature may think.  Or the reform may take one 
step at a time, addressing itself to the phase of the 
problem which seems most acute to the legislative 
mind.  The legislature may select one phase of one 
field and apply a remedy there, neglecting the others.   
Williamson v. Lee Optical of Okla., 348 U.S. 483, 489 (1955) 
(citations omitted).  Perhaps the legislature, viewing 12 
percent interest as a windfall and thus an "evil," wished to 
restrict its continued application, if at all, to only a small 
class of pending cases, and thought that application of 12 
percent interest to all cases in which there had been offers of 
settlement, as opposed to cases in which there had been both 
offers of settlement and adequately-sized judgment awards, would 
have unduly expanded that class.  
¶181 It was not irrational——and thus not unconstitutional——
for the legislature to draw its legislative line at parties who 
had actually obtained judgments greater than or equal to the 
amount 
specified 
in 
their 
earlier, 
rejected 
offers 
of 
No.  2015AP179.akz 
 
40 
 
settlement, instead of at parties who had simply made offers of 
settlement.17  
 
VIII.  WHETHER APPLICATION OF WIS. STAT. § 807.01(4) (2013-14) 
VIOLATES WIS. STAT. § 990.04 (2013-14) 
¶182 Finally, Lands' End argues that application to it of 
the amendments to Wis. Stat. § 807.01(4) violates Wis. Stat. 
§ 990.04 (2013-14).  The portion of the statute cited by Lands' 
End provides:  
The repeal of a statute hereafter shall not remit, 
defeat or impair any civil or criminal liability for 
offenses committed, penalties or forfeitures incurred 
or rights of action accrued under such statute before 
the repeal thereof, whether or not in course of 
prosecution or action at the time of such repeal; but 
all such offenses, penalties, forfeitures and rights 
of action created by or founded on such statute, 
liability wherefore shall have been incurred before 
the time of such repeal thereof, shall be preserved 
and remain in force notwithstanding such repeal, 
unless specially and expressly remitted, abrogated or 
done away with by the repealing statute. 
Wis. Stat. § 990.04 (2013-14). 
                                                 
17 I 
do 
not 
apply 
the 
complicated 
five-factor 
equal 
protection test cited by Lands' End.  See, e.g., Metro. Assocs. 
v. City of Milwaukee, 2011 WI 20, ¶64, 332 Wis. 2d 85, 796 
N.W.2d 717.  Though perhaps a useful tool in certain contexts, 
the overriding concern in equal protection cases not involving 
fundamental 
rights 
or 
suspect 
classes 
is 
whether 
the 
classification drawn by the legislature "has a rational basis," 
that is, whether "there is a rational relationship between the 
disparity 
of 
treatment 
and 
some 
legitimate 
governmental 
purpose."  Armour v. Indianapolis, Ind., 566 U.S. ___, 132 S. 
Ct. 2073, 2079-80 (2012) (citation omitted); see also, e.g., 
State v. Alger, 2015 WI 3, ¶39, 360 Wis. 2d 193, 858 N.W.2d 346.  
This test is well-established.  See Armour, 132 S. Ct. at 2080.  
Such a rational basis is clearly present here, and proceeding 
through a five-factor test to confirm that fact is unnecessary. 
No.  2015AP179.akz 
 
41 
 
¶183 Lands' End does not make clear to which of the 
categories specified in Wis. Stat. § 990.04 (2013-14) it 
believes the operation of Wis. Stat. § 807.01(4) (2009-10) 
belongs.  As discussed above, however, Lands' End never 
fulfilled the requirements of § 807.01(4) (2009-10) before it 
was amended.  Thus no liability, penalties, or forfeitures were 
incurred and no rights of action accrued before § 807.01(4) 
(2009-10) was repealed.  At least with regard to the brief and 
undeveloped arguments made by Lands' End on this point, § 990.04 
(2013-14) presents no impediment in this case.18 
IX.  CONCLUSION 
¶184 The legislature has broad authority to enact laws, 
including laws that apply retroactively.  These laws are 
entitled to a presumption of constitutionality; the legislature, 
like this court, interprets the constitution and attempts to 
follow it.  In passing 2011 Wis. Act 69 and amending Wis. Stat. 
§ 807.01(4) (2009-10), the legislature reduced an interest rate 
                                                 
18 At common law, "the repeal of a penal statute eliminated 
prosecution for past acts.  The so-called abatement doctrine 
provided that repeal, even repeal by amendment, and even by 
amendment reducing the penalty, would require dismissal of the 
indictment under the earlier criminal statute."  Antonin Scalia 
& Bryan A. Garner, Reading Law 264 (2012).  Scalia and Garner 
note that this doctrine "has been regarded (perhaps erroneously) 
as an exception" to the presumption against retroactivity.  Id.  
However, "[t]he United States and almost all the states have 
adopted saving statutes designed to eliminate the doctrine and 
to permit continued prosecution under the prior law."  Id.  The 
federal version of these savings statutes, at least according to 
Scalia and Garner, is found at 1 U.S.C. § 109 (id. at 264-65), 
and is somewhat similar in phrasing to Wis. Stat. § 990.04 
(2013-14). 
No.  2015AP179.akz 
 
42 
 
applicable to certain types of judgments.  Lands' End recovered 
one of these judgments, but only after the relevant legislation 
had been enacted.  Wisconsin Stat. § 807.01(4) (2013-14) does 
not have retroactive effect on Lands' End, even though it 
applies in the current case.  Nor does Lands' End possess a 
vested right in the earlier interest rate. 
¶185 No fundamental rights or suspect classes are involved 
in this case and the amendments made to Wis. Stat. § 807.01(4) 
pass 
the 
minimal 
test 
of 
rationality 
required 
by 
the 
constitutional guarantee of equal protection of the laws.  
Finally, Wis. Stat. § 990.04 (2013-14) does not bar application 
of 
Wis. 
Stat. 
§ 807.01(4) 
(2013-14) 
to 
Lands' 
End.  
Consequently, the decision of the circuit court should be 
affirmed. 
¶186 For the foregoing reasons, I respectfully concur. 
 
 
No.  2015AP179.dtp 
 
1 
 
¶187 DAVID T. PROSSER, J.   (dissenting).  For more than 
150 years, the Wisconsin Legislature has sought to promote 
pretrial settlement and hold down costs in civil litigation.   
¶188 The state's early statutes permitted a defendant to 
offer the plaintiff a specific judgment against the defendant.  
If the plaintiff accepted the offer and filed the appropriate 
papers, the plaintiff could have judgment against the defendant 
almost immediately.  If the plaintiff declined the offer, 
however, and then failed to recover "a more favorable judgment," 
the plaintiff was required to pay the defendant's costs from the 
time of the offer.  See, e.g., Wis. Stat. § 2789 (1878); Chi. & 
Nw. Ry. Co. v. Groh, 85 Wis. 641, 648, 55 N.W. 714 (1893). 
¶189 In the 1970s the legislature strengthened the hand of 
plaintiffs in civil litigation.  Wisconsin Stat. § 269.02(3) 
(1973) provided: 
 
(3) Settlement.  After issue is joined but at 
least 20 days before trial, the plaintiff may serve 
upon the defendant a written offer of settlement for 
the sum, or property, or to the effect therein 
specified, with costs.  If the defendant accepts the 
offer and serves notice thereof in writing, before 
trial and within 10 days after receipt of the offer or 
within 40 days after service of the notice of trial, 
whichever is later, he may file the offer, with proof 
of service of the notice of acceptance, with the clerk 
of court.  If notice of acceptance is not given, the 
offer cannot be given as evidence nor mentioned on the 
trial.  If the offer of settlement is not accepted and 
the plaintiff recovers a more favorable judgment, he 
shall recover double the amount of the taxable costs. 
(Emphasis added.) 
No.  2015AP179.dtp 
 
2 
 
¶190 In 1980 the legislature added a tough provision on 
prejudgment interest when either party declined to accept an 
offer of settlement from the other party: 
 
807.01(4) If there is an offer of settlement by 
the party under this section which is not accepted and 
the party recovers a judgment which is greater than or 
equal to the amount specified in the offer of 
settlement, the party is entitled to interest at the 
rate of 12% per annum on the amount recovered from the 
date of the offer of settlement until the amount is 
paid.  Interest under this section is in lieu of 
interest computed under ss. 814.04(4) and 815.05(8). 
See § 2, ch. 271, Laws of 1979.  The 12 percent interest rate in 
Wis. Stat. § 807.01(4) was adopted at the same time the 
legislature increased interest rates from 7 percent to 12 
percent per annum on a verdict and on execution upon judgment.  
See §§ 3-4, ch. 271, Laws of 1979, amending Wis. Stat. 
§§ 814.04(4) and 815.05(8).1 
¶191 The language adopted in 1980 was the language in place 
on July 1, 2009, when Lands' End made an offer of settlement to 
the City of Dodgeville on the tax refund that Lands' End was 
seeking from the City's property tax assessment for 2008.   
¶192 The issue presented in this case is whether the above-
referenced language is applicable to Lands' End's claim, or 
whether new language adopted in 2011 nullified the effect of the 
older language for Lands' End. 
                                                 
1 Section 5 of Chapter 271 read: "Applicability.  The 
treatment or creation of sections 807.01(4), 814.04(4) and 
815.05(8) of the statutes apply only to actions commenced on or 
after the effective date of this act."  This provision made the 
interest increases entirely prospective. 
No.  2015AP179.dtp 
 
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I 
¶193 This case is part of nearly a decade of continuous 
litigation between Lands' End and the City of Dodgeville over 
property tax assessments on six parcels of the corporation's 
land in the City.  Much of the history is detailed in Lands' 
End's brief and in the record. 
¶194 In 2005 the City of Dodgeville assessed the six 
parcels 
of 
land 
at 
$39,964,600 
and 
imposed 
a 
tax 
of 
$1,169,665.73, which Lands' End paid under protest. 
¶195 In 
2006 
the 
City 
assessed 
the 
six 
parcels 
at 
$47,332,300 and imposed a tax of $1,348,540.60, which Lands' End 
paid under protest. 
¶196 Lands' End's claims for refunds of its alleged 
overpayments for 2005 and 2006 led to an 11-day trial before 
Iowa County Circuit Judge Edward E. Leineweber.  On May 29, 
2009, Judge Leineweber issued a 16-page memorandum decision 
concluding that the fair market value of Lands' End's property 
was $25,000,000 in both 2005 and 2006.  After considering 
various 
additional 
submissions, 
the 
court 
filed 
detailed 
findings of fact, conclusions of law, and judgment on September 
1, 2009. 
¶197 Lands' End also challenged the City's 2007 assessment 
and tax and its 2008 assessment and tax, which were based on the 
same appraisal for the City that Judge Leineweber pointedly 
criticized in his May 29, 2009 memorandum decision. 
¶198 On July 1, 2009, Lands' End made its offer of 
settlement on the requested tax refund for 2008.  This offer was 
No.  2015AP179.dtp 
 
4 
 
made before the City appealed the September 1 judgment but after 
it had lost on the 2005 and 2006 assessments in the memorandum 
decision.  Lands' End did not invoke Wis. Stat. § 807.01(4) 
until it responded to the 2008 property tax assessment. 
¶199 On May 27, 2010, the court of appeals affirmed the 
decision of the circuit court on the 2005 and 2006 tax refunds.  
This court denied a petition for review on April 21, 2011.  
Consequently, Lands' End had a judgment, affirmed on appeal, 
about the invalidity of the City's 2005 and 2006 assessments 18 
months before the legislature revised Wis. Stat. § 807.01(4). 
¶200 Admittedly, the judgment applied to the 2005 and 2006 
property tax assessments, not the 2008 assessment.  However, the 
City upped the assessment in 2008 to $56,423,100, which the 
Board of Review reduced to $54,000,000 because of acknowledged 
errors.  Upping the assessment to $54,000,000 for 2008 was 
unrealistic on its face because the City was relying on the same 
appraisal used in 2005 for property that had not changed. 
¶201 This case is complicated by the timing of various 
court decisions.  For example, in the 2008 case, Iowa County 
Circuit Judge William Dyke denied Lands' End's motion for 
summary judgment about five weeks before the court of appeals 
affirmed Judge Leineweber's September 1, 2009 judgment.  His 
ruling was not reversed until September 12, 2013——a decision in 
which the court of appeals remanded the case to the circuit 
court "for entry of judgment in favor of Lands' End in the 
No.  2015AP179.dtp 
 
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amount of $724,292.68, plus statutory interest and any other 
interest or costs to which Lands' End may be entitled."2 
¶202 Ultimately, the City of Dodgeville had to refund 
substantial tax overpayments to Lands' End for 2005, 2006, 2007, 
and 2008.  The City had to pay interest on all these refunds.  
The issue here is whether the City of Dodgeville is required to 
pay 12 percent per annum interest on the $724,292.68 refund on 
the 2008 taxes——from the date of Lands' End's offer of 
settlement (July 1, 2009) until the amount is paid.  
II 
¶203 The bill that created Wis. Stat. § 807.01(4) in 1980 
was authored by State Senator William Bablitch, who soon 
thereafter became a member of this court.  In 1999 Justice 
Bablitch had the opportunity to explain that the purpose of Wis. 
Stat. § 807.01 is "to encourage settlement and accordingly, 
secure just, speedy and inexpensive determinations of disputes."  
Prosser v. Leuck, 225 Wis. 2d 126, 140, 592 N.W.2d 178 (1999) 
(citing Schmidt v. Schmidt, 212 Wis. 2d 405, 412-13, 569 
N.W.2d 74 (Ct. App. 1997); White v. Gen. Cas. Co. of Wis., 118 
Wis. 2d 433, 438, 348 N.W.2d 614 (Ct. App. 1984)).   
¶204 Previously, the court of appeals had asserted that 
"[t]he purpose of imposing costs and interest under subsecs. (3) 
and (4) [of § 807.01] is punitive."  Blank v. USAA Prop. & Cas. 
Ins. Co., 200 Wis. 2d 270, 279, 546 N.W.2d 512 (Ct. App. 1996) 
                                                 
2 Curiously, the court of appeals did not decide Lands' 
End's 2007 tax refund claim until May 8, 2014. 
No.  2015AP179.dtp 
 
6 
 
(citing Gorman v. Wausau Ins. Cos., 175 Wis. 2d 320, 329, 499 
N.W.2d 245 (Ct. App. 1993)). 
¶205 Whether the purpose of double costs and 12 percent 
interest for parties who reject offers of settlement is truly 
"punitive" is open to debate.  But this court has said:  
The risk of being assessed the penalty of double costs 
under § 807.01(3) encourages parties to seriously 
assess 
their 
chances 
of 
winning 
a 
coverage 
or 
liability dispute.  The party who rejects a settlement 
offer and forges ahead with litigation does so with 
the full knowledge of § 807.01(3) [and (4)] and that 
if not successful, they may be subject to double costs 
under § 807.01(3) [and 12 percent interest "from the 
date of the offer of settlement until the amount is 
paid"]. 
Prosser, 225 Wis. 2d at 147 (emphasis added). 
III 
¶206 To determine whether Wis. Stat. § 807.01(4) is still 
applicable to the partial refund of Lands' End's 2008 property 
tax, we must engage in statutory interpretation, applying the 
principles in State ex rel. Kalal v. Circuit Court for Dane 
County, 2004 WI 58, 271 Wis. 2d 633, 681 N.W.2d 110. 
¶207 In 2008, Wis. Stat. § 807.01 was entitled "Settlement 
offers."  It had five subsections.  Subsection (3) contained the 
provision in which "the plaintiff shall recover double the 
amount of taxable costs."  Subsection (4) read: 
 
If there is an offer of settlement by a party 
under this section which is not accepted and the party 
recovers a judgment which is greater than or equal to 
the amount specified in the offer of settlement, the 
party is entitled to interest at the annual rate of 
12% on the amount recovered from the date of the offer 
of settlement until the amount is paid.  Interest 
under this section is in lieu of interest computed 
under ss. 814.04(4) and 815.05(8). 
No.  2015AP179.dtp 
 
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Wis. Stat. § 807.01(4) (2007-08). 
¶208 Subsection (5) read: "Subsections (1) to (4) apply to 
offers which may be made by any party to any other party who 
demands a judgment or setoff against the offering party."  Wis. 
Stat. § 807.01(5) (2007-08). 
¶209 Three 
conditions 
must 
exist 
under 
Wis. 
Stat. 
§ 807.01(4) (2007-08) for a party to qualify for 12 percent 
interest per annum "on the amount recovered."  First, the party 
makes "an offer of settlement" to another party "under this 
section."  Second, the "offer of settlement" "is not accepted" 
by the other party "within 10 days after receipt of the offer."3  
Third, the offering party recovers "a judgment which is greater 
than or equal to the amount specified in the offer of 
settlement." 
¶210 If these three conditions are satisfied "the party is 
entitled to interest at the annual rate of 12% on the amount 
recovered from the date of the offer of settlement until the 
amount is paid."  These conditions and consequences are examined 
in turn. 
A 
¶211 Subsections (1), (2), and (3) of Wis. Stat. § 807.01 
refer to "a written offer of settlement."  These written offers 
of settlement are "served" on the other party.  The party making 
an offer of settlement must "do so in clear and unambiguous 
                                                 
3 The time limit is referenced in the three preceding 
subsections of the statute.  See Wis. Stat. §§ 807.01(1), (2), 
and (3). 
No.  2015AP179.dtp 
 
8 
 
terms," Ritt v. Dental Care Associates, S.C., 199 Wis. 2d 48, 
76, 543 N.W.2d 852 (Ct. App. 1995), so that the offeree may 
"fully and fairly evaluate the offer from his or her own 
independent perspective," id. at 75 (citing Testa v. Farmers 
Ins. Exch., 164 Wis. 2d 296, 302, 474 N.W.2d 776 (Ct. App. 
1991)). 
¶212 There is no dispute that this condition was satisfied 
by Lands' End. 
B 
¶213 There also is no dispute that Lands' End's offer of 
settlement was not accepted.  The City opposed Lands' End's 
motion for summary judgment, and the case was litigated for 
several years. 
C 
¶214 Finally, Lands' End recovered a judgment against the 
City of Dodgeville after winning the 2013 appeal.  Moreover, 
subsection (4) applied to offers made by any party to any other 
party who demands a judgment or setoff against the offering 
party.  Wis. Stat. § 807.01(5).  Lands' End demanded a judgment 
and ultimately received a judgment.  The statute in 2009 and 
2010 
imposed 
no 
timing 
requirement 
for 
the 
judgment.  
Consequently, Lands' End satisfied every condition in the 
statute. 
¶215 If a party satisfies all three conditions, "the party 
is entitled to interest at the annual rate of 12% on the amount 
recovered from the date of the offer of settlement until the 
amount is paid."  (Emphasis added.) 
No.  2015AP179.dtp 
 
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¶216 The words of a statute have meaning.  To say that a 
party is "entitled" to something means that the party has been 
granted a legal right to or qualifies for that thing.  See 
Entitle, Black's Law Dictionary 649 (10th ed. 2014); see also 
id. (defining "entitlement" as an "absolute right to a (usu. 
Monetary) benefit, such as social security, granted immediately 
upon meeting a legal requirement"); The American Heritage 
Dictionary of the English Language 615 (3d ed. 1992) ("To 
furnish with a right or claim to something . . . .").  Two cases 
by the Supreme Court of the United States in recent decades also 
defined "entitled" in terms of qualifying for a right or 
benefit, and both cases cited to an earlier edition of Black's 
in their analyses.  See Ingalls Shipbuilding, Inc. v. Director, 
Office of Worker's Comp. Programs, 519 U.S. 248, 255-56 (1997) 
("[T]he ordinary meaning of the word 'entitle' indicates that 
the 'person entitled to compensation' [in 33 U.S.C. § 933(g)(1)] 
must at the very least be qualified to receive compensation."); 
Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469, 477 
(1992) ("Both in legal and general usage, the normal meaning of 
entitlement includes a right or benefit for which a person 
qualifies, and it does not depend upon whether the right has 
been acknowledged or adjudicated.  It means only that the person 
satisfies the prerequisites attached to the right."); see also 
Entitle, Black's Law Dictionary 532 (6th ed. 1990) ("To qualify 
for; to furnish with proper grounds for seeking or claiming."). 
¶217 The "right" created by the statute was recognized 
implicitly in Gorman, 175 Wis. 2d at 329, where the court said: 
No.  2015AP179.dtp 
 
10 
 
"Nothing in sec. 807.01, Stats., requires a party to file a 
motion in order to recover costs.  Rather, this statute mandates 
the court to impose costs and interest when the defendant 
rejects a valid offer of settlement and the plaintiff recovers a 
greater judgment."  (Emphasis added.)  The Prosser court stated 
that "the plain language [of the statute] provides that interest 
accrues throughout the litigation."  Prosser, 225 Wis. 2d at 
152. 
¶218 Wisconsin Stat. § 807.01(4) then specifies what "the 
party" is "entitled" to——namely, (1) "interest at the annual 
rate of 12%," (2) "on the amount recovered," and (3) "from the 
date of the offer of settlement until the amount is paid."  
Subsection (4) of § 807.01 is different from a statute that 
employs a broad term like "compensation."  Subsection (4) is 
very specific in directing that it is interest at a stated rate 
and for a stated period of time to which a prevailing party is 
entitled. 
 
In 
Upthegrove 
Hardware, 
Inc. 
v. 
Pennsylvania 
Lumbermans Insurance Co., 152 Wis. 2d  7, 13, 447 N.W.2d 367 
(Ct. App. 1989), the court of appeals summed up the law when it 
said that the prevailing party "is seen as having 'recovered' 
the amount awarded in the judgment on the date of the settlement 
offer."  (Emphasis added.) 
IV 
¶219 In the 1980 legislation, two statutes, Wis. Stat. 
§§ 814.04(4) and 815.05(8), were amended to increase the rate of 
interest from 7 percent to 12 percent.  Ch. 271, Laws of 1979.  
Statutory interest rates needed to be raised at that time so 
No.  2015AP179.dtp 
 
11 
 
that parties did not have an incentive to delay payment.  The 12 
percent interest rate included in Wis. Stat. § 807.01(4) 
corresponded with the other changes.  The legislature made clear 
that the change in rates was prospective when it said that "the 
statutes apply only to actions commenced on or after the 
effective date of this act." 
¶220 Over the next 30-plus years, interest rates fell, but 
the 12 percent rate in the statutes was preserved because it 
supported the objective of the statutes to encourage pretrial 
settlement and prompt payment of judgments.  When interest rates 
in the three statutes were reduced in 2011, the country had 
historically low interest rates and adjustments may have 
appeared necessary.  But there is no evidence that the 
legislature intended to undermine the basic objectives of Wis. 
Stat. § 807.01(4). 
¶221 In her dissenting opinion in Prosser v. Leuck, Justice 
Ann Walsh Bradley observed: 
 
There can be little doubt that Wis. Stat. 
§ 807.01 exists to encourage parties to settle their 
cases rather than take them to trial.  Beacon Bowl, 
Inc. v. Wisconsin Elec. Power Co., 176 Wis. 2d 740, 
501 
N.W.2d 788 
(1993); 
DeMars 
v. 
LaPour, 
123 
Wis. 2d 366, 373, 366 N.W.2d 891 (1985).  To the 
extent that § 807.01 forces parties to carefully 
analyze their realistic chances of liability or 
recovery and reevaluate the merits of taking their 
case to trial, the statute serves an important 
purpose.  Settlement is to be encouraged rather than 
discouraged in the law. 
Prosser, 225 Wis. 2d at 155 (Ann Walsh Bradley, J., dissenting). 
¶222 In 2009, Wis. Stat. § 807.01(4) gave notice to all 
litigants that its provisions would affect conduct that had not 
No.  2015AP179.dtp 
 
12 
 
yet occurred.  Therefore, the party to whom an offer of 
settlement was made had notice of the consequences that would 
follow if a judgment in a greater amount were recovered. 
¶223 Conversely, parties who made statutory offers of 
settlement relied on the entitlement created by the statute.  
Wisconsin 
Stat. 
§ 801.01 
created 
clear 
expectations 
that 
reasonable people could and did rely on as they proceeded in 
litigation. 
¶224 Retroactive application of the 2011 changes in the law 
undermines the entitlement to 12 percent interest set out in the 
statute.  It creates an incentive to extend litigation and 
thereby delay payment.  The City is effectively being rewarded 
for overtaxing Lands' End and for stringing out the litigation 
that followed.4  It should be noted that Lands' End would have 
been required to pay 1 percent interest every month, plus 
potential penalties, if it had not timely paid the 2008 tax and 
if it had not eventually succeeded in court.  Wis. Stat. 
§ 74.47.  It is hard to believe the legislature intended the 
inequitable result of retroactively changing the interest rates 
for offers of settlement made long before the statutory changes 
                                                 
4 In S.A. Healy Co. v. Milwaukee Metropolitan Sewerage 
District, 60 F.3d 305, 308 (7th Cir. 1995), Judge Posner 
skillfully analyzed one problem that Wis. Stat. § 807.01(4) 
sought to address: "[D]elay in accepting the plaintiff's demand 
allows the defendant to earn interest on money that (it is 
subsequently determined) should really be the plaintiff's.  The 
award of interest from the date of the settlement demand 
deprives the defendant of this incentive to reject rightful 
demands." 
No.  2015AP179.dtp 
 
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but not changing the rate for taxpayers who owe additional 
property taxes. 
¶225 These considerations are the foundation of the court 
of appeals decision in Johnson v. Cintas Corp. No. 2, 2015 WI 
App 14, 360 Wis. 2d 350, 860 N.W.2d 515, which concluded that 
the 
retroactive 
application 
of 
the 
2011 
changes 
was 
unconstitutional.  I agree with the court's comprehensive, well-
written opinion and would affirm its determination.5  In 
overruling the Johnson case and affirming the circuit court's 
ruling in the present case, this court is likely undermining the 
reasonable expectations of multiple other parties who made 
offers of settlement in conformity with the statute. 
V 
¶226 Although I fully support the court of appeals' 
decision in Johnson, the lead opinion in this case makes it 
                                                 
5 Johnson v. Cintas Corp. No. 2, 2015 WI App 14, 360 
Wis. 2d 350, 860 N.W.2d 515, is consistent with court decisions 
in other states.  See, e.g., Dubois v. State Farm Ins. Co., 571 
So. 2d 201, 207 (La. Ct. App. 1990) (concluding that amendment 
to statutory interest rate was "substantive law" that "applie[d] 
only to recovery in accidents occurring after its passage"), 
approved by Socorro v. City of New Orleans, 579 So. 2d 931, 944 
(La. 1991); Herring v. Golden State. Mut. Life Ins. Co., 318 
N.W.2d 641, 646 (Mich. Ct. App. 1982) (applying statute amending 
interest rate was improper where "the action was filed over a 
year prior to the effective date of the statute" and "the 
controversy arose before the statute was enacted"). 
For further insights regarding jurisdictions that decline 
to give retroactive effect to changes in interest rates, see 
generally Diane M. Allen, Annotation, Retrospective Application 
and Effect of State Statute or Rule Allowing Interest or 
Changing Rate of Interest on Judgments or Verdicts, 41 A.L.R. 
4th 694, §§7, 11 (1985 & Supp. June 2015). 
No.  2015AP179.dtp 
 
14 
 
necessary to address the lead opinion's conclusion that Lands' 
End was required to obtain a legally enforceable "judgment" 
before the 2011 change in the law.  The lead opinion states: 
Lands' End did not acquire a legally enforceable right 
to 
recover 
interest 
until 
it 
recovered 
a 
judgment. . . .  Changing the interest rate in Wis. 
Stat. 
§ 807.01(4) 
simply 
alter[ed] 
the 
legal 
consequence of events not yet completed.  Before 
Lands' End recovered a judgment, its right to interest 
was inchoate. 
Lead op., ¶72.  This holding penalizes Lands' End not only 
because it abandons the governing principles of the statute but 
also because it rests on the timing of the circuit court's 
mistaken ruling on summary judgment. 
¶227 Clearly, Lands' End should have received a favorable 
judgment on its 2008 assessment before the amendment to Wis. 
Stat. § 807.01(4) in December 2011.  Unfortunately, the actual 
judgment did not come until after the circuit court's decision 
was reversed.  However, before the circuit court's mistaken 
ruling, Lands' End had been successful in other litigation 
against the City on the same property.  The legal foundation had 
already been built for Lands' End's eventual success on its 
suits on the 2008 assessment as well as the 2007 assessment.  
The Iowa County Circuit Court had already determined that the 
City's assessments for 2005 and 2006 were incorrect, and the 
City had conceded that there was no material change in the value 
of the property between 2006 and 2008.  See Lands' End, Inc. v. 
City of Dodgeville, No. 2010AP1185, unpublished slip op., ¶23 
(Wis. Ct. App. Sept. 12, 2013); see also Lands Ends, Inc. v. 
No.  2015AP179.dtp 
 
15 
 
City of Dodgeville, Nos. 2013AP1490, 2013AP1491, and 2013AP1492, 
unpublished slip op., ¶17 (Wis. Ct. App. May 8, 2014).6 
¶228 The lead opinion concludes that Lands' End's right to 
the 12 percent interest rate was "contingent on a subsequent 
determination by a court."  Lead op., ¶77.  But the lead opinion 
forces Lands' End to bear the burden of the right court making 
the wrong determination at a critical time.  Had the same court 
                                                 
6 As explained by the court of appeals, 
[T]he City argues that issue preclusion does not apply 
in this case . . . .  [T]he flaw in the City's issue 
preclusion argument is that the City miscasts the 
"issue" to which issue preclusion applies.  The 
"issue" is not the proper 2008 assessed value of 
Lands' End's property.  Rather, we determine here that 
issue preclusion applied only to the "issue" of the 
correct 2006 assessment.  The resolution of that issue 
through the application of issue preclusion does not, 
by itself, establish the proper 2008 assessed value.  
Rather, it is the combination of issue preclusion and 
a new undisputed fact in the present case that 
persuades us that Lands' End is entitled to summary 
judgment.  The new undisputed fact is that the value 
of the subject property did not materially change 
between 2006 and 2008. 
. . . . 
Giving preclusive effect to Judge Leineweber's 
finding that the 2006 value of the property was 
$25,000,000, and combining that finding with the 
undisputed fact in this case that the value of the 
property essentially stayed the same, leads us to 
conclude that the value of the property in 2008 must 
be $25,000,000.  Because there is no genuine dispute 
that the 2008 value of the property is $25,000,000, we 
conclude that Lands' End is entitled to judgment as a 
matter of law. 
Lands' 
End, 
Inc. 
v. 
City 
of 
Dodgeville, 
No. 2010AP1185, 
unpublished slip op., ¶¶10, 29 (Wis. Ct. App. Sept. 12, 2013). 
No.  2015AP179.dtp 
 
16 
 
decided the case six weeks later, the result would have been 
different. 
¶229 For the foregoing reasons, I respectfully dissent. 
¶230 I am authorized to state that Chief Justice PATIENCE 
DRAKE ROGGENSACK joins this dissent. 
 
 
 
 
 
No.  2015AP179.dtp 
 
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