Opinion ID: 2184987
Heading Depth: 1
Heading Rank: 3

Heading: Interest on amount due from the state.

Text: Respondents' motion to review seeks modification of the judgment insofar as it denies interest on the amount due. Respondents contend they are entitled to legal interest from October 30, 1967, on the amount found due and owing from the state. In Milwaukee v. Firemen Relief Asso. (1969), 42 Wis. 2d 23, 165 N. W. 2d 384, this court held that a delay in  payment of money due from a governmental unit carries with it the obligation to pay interest for deprivation of its use and that this obligation exists regardless of the absence of statutory direction. We are satisfied that the legislative definition of the legal rate of interest, sec. 138.04, Stats., should be construed as being declaratory of the common law as it now exists and as applicable to all legal entities, including all branches of government, unless specifically exempted by legislative enactment. Milwaukee v. Firemen Relief Asso., supra, page 39. The court specifically declared the obligation to pay interest applicable to the state. The court, however, went on to say that the enforceability of collecting interest against the state was conditioned by the immunity of the state from suit. . . . [T]he obligation to pay interest is applicable to all forms of government, including the state. As in Holytz, the enforceability of the right, herein declared, to collect interest against the state is conditioned by its constitutional immunity from suit, subject to such exceptions and under terms as may be determined by the legislature. Milwaukee v. Firemen Relief Asso., supra, page 41. The immunity of the state from suit by virtue of art. IV, sec. 27, of the Wisconsin Constitution is a procedural rather than substantive immunity. . . . As we have made absolutely clear in Holytz v. Milwaukee (1962), 17 Wis. 2d 26, 115 N. W. 2d 618, the immunity from substantive liability is totally different from the procedural immunity that the sovereign state obtains when it is free from unconsented lawsuits in Wisconsin by virtue of art. IV, sec. 27, of the Wisconsin Constitution. . . . The state's immunity to suit has nothing to do, except in the practical procedural aspect, with the question of the state's substantive obligation to pay interest. . . . Milwaukee v. Firemen Relief Asso., supra, page 34.  A procedural means of suit against state officers is provided by writ of mandamus. We consider Holytz v. Milwaukee (1962), 17 Wis. 2d 26, 115 N. W. 2d 618, and Milwaukee v. Firemen Relief Asso., supra , as precedent for determining that the respondents are entitled to interest at the legal rate from October 30, 1967, upon the unpaid balance of the state aid due them as provided in sec. 49.52 (2), Stats. The judgment of the trial court is so modified to provide for the payment of such interest and, as modified, the judgment is affirmed. By the Court. Judgment modified and, as modified, affirmed.