Court Opinion

ID: 9699967
Source: CourtListenerOpinion
Date Created: 2023-08-25 21:01:11.968387+00
Date Added: 2024-06-11T18:21:01.442075
License: Public Domain

Fairchild, J.
(dissenting). Very probably the university will benefit from the arrangement under consideration. I regret, therefore, that I cannot conscientiously join in approval.
There are a number of serious questions raised by facets of this arrangement. Their multiplicity, and the accompanying difficulty of dealing with all facets at once is a tribute to the ingenuity of the designer. I will discuss only the objection that the Regents have sought to make the state a party in carrying on a work of internal improvement, forbidden by sec. 10, art. VIII, Const.
We must bear in mind that the disposition of the land in question has been effected under the authority of the Regents to sell or lease university land. The legislature has given no more specific authority to enter into the arrangement which has been made. Thus the particular method of disposition employed does not come before the court with the presumption of constitutionality which would tend to support it if the legislature had expressly authorized it.
It must also be conceded that if the Regents had directly dedicated state property or state funds to make possible the construction of a commercial shopping center, the constitutional prohibition against works of internal improvement would have been violated. State ex rel. Martin v. Giessel (1948), 252 Wis. 363, 371, 31 N. W. (2d) 626, holding invalid a grant of state funds to local housing authorities to aid in construction of veterans’ housing projects.
Can a similar end result be accomplished by the means here employed ?
*141The Regents evidently concluded that they were not authorized to deed the land to Kelab, Inc., without consideration, but that they were legally free to make a gift to Kelab, Inc., of the “anonymous” funds. Thus, the disposition of state land has been given the appearance of a sale for a cash consideration. As a result of the gift of the funds, succeeded by the apparent sale, funds which may not at the start have been subject to all the restrictions as to manner and purpose of use to which other state funds are subject, now have the unqualified character of state funds.
Assuming the correctness of the Regents’ conclusion that because of the special character of their possession of the “anonymous” funds, such funds, unlike the state land, could be dedicated to make possible the construction of a shopping center, it has not been established that the amount of money collected from Kelab, Inc., is equal to the value of the land.
It is apparently claimed that the amount can be adequate without being equal; and that the Regents, in their discretion, could treat the anticipation of the ultimate enjoyment by the university of the net profits of Kelab, Inc., and Hill-dale, Inc., as a sufficient offset against any- insufficiency of the price.
The matter is now here upon summary judgment, without a determination, by trial, of the issue of fact as to the sufficiency of the price. Assuming, as we must, at this stage, that if that issue were tried, plaintiff might prevail, and show that the value of the land was not $6,000, but $25,000 per acre, it would follow, in my opinion, that state property, to the extent of the difference, has been dedicated for the creation of a shopping center, and that there has been a violation of the constitutional prohibition against the state’s being a party in carrying on a work of internal improvement.
The decisions relied upon in the majority opinion deal primarily with plans for the construction by friendly corpo*142rate entities of facilities for the carrying on of the functions of state government, and hold that debts of such corporate entities are not debts of the state, and that those plans therefore do not violate the prohibition against state debt, sec. 4, art. VIII, Const. Those plans were, for the most part, plans for financing activities which the state could legally have performed if it had sufficient funds. It has never been decided that state property may be conveyed to one of these friendly entities at less than a fair price so that it can build a commercial establishment.
In my opinion, the issue as to the value of the land disposed of should have been resolved by trial. If it were determined that the price received was less than the fair market value of the land, the illegality of the transaction would be established. If it were determined that the price was sufficient, other issues, such as whether the Regents were free to dedicate the donated funds to the construction of a shopping center would need to be resolved.