Court Opinion

ID: 9690355
Source: CourtListenerOpinion
Date Created: 2023-08-24 19:08:44.533761+00
Date Added: 2024-06-11T08:52:12.894760
License: Public Domain

PATIENCE DRAKE ROGGENSACK, J.
¶ 99. {concurring). The majority opinion concludes that the sales territory serviced by Racine Harley-Davidson, Inc. (Racine H-D) is part of its "motor vehicle dealer agreement" under Wis. Stat. § 218.0166(8)(a) (2003-04).1 Majority op., ¶ 78. I agree with this conclusion. I also applaud the majority opinion's thorough discussion of the common law standards of deference to agency decisions that have been applied in the past. However, the majority opinion also concludes that the Department of Hearings & Appeals' (DHA) interpretation of § 218.0166(8)(a), a question of law, may be accorded the same levels of deference that we have accorded the decisions of a line agency that is charged with administering a specific statutory scheme. Majority op., ¶¶ 55-58. I write separately for two reasons: (1) I disagree with the majority opinion's conclusion that common law levels of deference may be accorded to decisions of the DHA administrator when the administrator's decision has not been adopted by the line agency, and (2) the majority opinion overlooks contract interpretation that is central to deciding the issue presented for review.
I. BACKGROUND
¶ 100. Racine H-D has been a franchised Harley-Davidson Motor Company (Harley-Davidson) dealer since 1992. As part of its relationship with Harley-Davidson, Racine H-D has agreed to service specific geographic areas that are referred to as Racine H-D's *603"Territory." Initially Racine H-D's Territory was all of Racine County, which included the Burlington zip code, 53105. Subsequently, its Territory was described by a list of zip codes.
¶ 101. However, in 2001 when Harley-Davidson provided a new franchise agreement, the Burlington zip code was not included in Racine H-D's Territory. Racine H-D claimed that removing Burlington from its Territory was a modification of its franchise agreement that substantially and adversely affected its rights as a Harley-Davidson motor vehicle dealer and that the modification was made without good cause. It filed a complaint with DOT, alleging a violation of Wis. Stat. § 218.0116(8).2
¶ 102. The complaint was referred to the DHA to adjudicate, as authorized by statute, Wis. Stat. § 218.0116(8)(a), and a DHA hearing examiner was assigned to adjudicate it, Wis. Stat. § 227.43(l)(bg). The DHA hearing examiners are assigned to hear contested case proceedings from many different line agencies.3 The legislature has required the DHA administrator to establish a system for their assignments that "shall *604ensure, to the extent practicable, that hearing examiners are assigned to different subjects on a rotating basis." Section 227.43(lg).4
¶ 103. Harley-Davidson moved for summary judgment to dismiss the complaint. It contended that Racine H-D's Territory was not a part of its "motor vehicle dealer agreement," as those terms are used in Wis. Stat. § 218.0116(8); and therefore, assigning the Burlington zip code to another dealer did not contravene § 218.0116(8). The hearing examiner agreed with Harley-Davidson because the description of Racine H-D's Territory was not contained within the Harley-Davidson Motor Company Motorcycle Dealer Contract (Dealer Contract) or the Harley-Davidson Motor Company General Conditions of Sales and Service (Conditions of Sales and Service) that the parties signed. The DHA administrator affirmed the decision of the hearing examiner. It is the decision of the DHA administrator, granting summary judgment dismissing Racine H-D's complaint, that is before us for review.
II. DISCUSSION
A. Standards of Review
1. Statutes
¶ 104. Statutory construction is a question of law. Buettner v. DHFS, 2003 WI App 90, ¶ 6, 264 Wis. 2d *605700, 663 N.W.2d 282. We have applied three levels of common law deference to an administrative agency's interpretation of a statute: (1) no deference, often referred to as de novo review; (2) due weight deference, where we affirm an agency's interpretation if it is reasonable and we conclude that another interpretation is not more reasonable; and (3) great weight deference, where we affirm an agency's interpretation if it is reasonable, even when we conclude that another interpretation is more reasonable. UFE Inc. v. LIRC, 201 Wis. 2d 274, 285-87, 548 N.W.2d 57 (1996).
¶ 105. Due weight deference requires that the legislature has charged the agency with the administration of the statute in question and that the agency has had at least some experience interpreting the statute in a consistent fashion. Id. at 286-87. In according due weight deference, we defer to an agency's statutory interpretation only when we conclude that another interpretation of the statute is not more reasonable than that chosen by the agency. Id. at 287. In order to decide that question, we make a comparison between the agency's interpretation and alternate interpretations. This comparison requires us to construe the statute ourselves. In so doing, we employ judicial expertise in statutory construction, and we embrace a major responsibility of the judicial branch of government, deciding what statutes mean. Therefore, this level of deference is of a lesser concern than is great weight deference.
¶ 106. Great weight deference also requires that the legislature has charged the agency with the administration of the statute in question. Id. at 284. Additionally, in order to accord great weight deference, the agency must have long standing expertise in administering the statute; it must have used its expertise and specialized knowledge in forming its interpretation of the statute; and the agency's interpretation must pro*606vide more uniformity and consistency in the application of the statute than would a court's decision. Id. (citing Harnischfeger Corp. v. LIRC, 196 Wis. 2d 650, 660, 539 N.W.2d 98 (1995)).
¶ 107. Our basis for giving even due weight deference to an agency's statutory interpretation is bottomed on two required assumptions: the statute is one that the agency was charged with administering and the agency has at least some expertise in the interpretation of the statute in question. UFE, 201 Wis. 2d at 284-86.
¶ 108. The majority opinion concludes the first assumption, that the DHA was charged with administering Wis. Stat. § 218.0116(8), applies. Majority op., ¶ 55. It also concludes that the DHA is charged with enforcing § 218.0116(8). Id. I conclude that neither conclusion pertains here. First, the type of legislatively assigned responsibility of a deciding authority for a line agency to which we previously have accorded deference, e.g., LIRC, has been limited to the discrete statutory context that the line agency, itself, administered. See, e.g., West Bend Educ. Ass'n v. WERC, 121 Wis. 2d 1, 11-13, 357 N.W.2d 534 (1984) (concluding that the agency (WERC) can provide uniformity and consistency in the field of its specialized knowledge); Jicha v. DILHR, 169 Wis. 2d 284, 290-91, 485 N.W.2d 256 (1992) (concluding that deference to an agency's statutory interpretation is appropriate only where the interpretation is based on the specialized knowledge, technical competence and experience particular to the agency (LIRC)).
¶ 109. Second, in cases brought to the DHA for a hearing, the DHA administrator makes the final agency decision that is then subject to judicial review under Wis. Stat. § 227.52. Wis. Stat. § 227.46(2m). However, the DHA administrator does not have the type of specialized knowledge and technical competence of other deciding *607authorities, such as LIRC and WERC, to which we have accorded deference in the past. This is so because the DHA administrator is the final decision maker for many types of DHA adjudications, e.g.: (1) the Department of Corrections (DOC) parole and probation revocations, Wis. Admin. Code § HA 2.05(8); (2) the DOC good time forfeitures, Wis. Admin. Code § HA 2.06(8); (3) all decisions of the DOT for which a hearing examiner is appointed under Wis. Stat. § 227.43(l)(bg);5 (4) decisions by the Department of Commerce in regard to permitting, suspending or revoking a permit for a manufactured home park, § 227.43(l)(bg); (5) decisions by the Department of Commerce in regard to licensing or suspending and revoking a license to be a manufactured home dealer, § 227.43(l)(bg); and (6) decisions by highway commissioners of municipalities to close a highway for safe transportation of certain hazardous materials, § 227.43(1)(bg). And finally, the DOT cannot by rule or by order in an individual case adopt the DHA administrator's decision. Section 227.46(3). Therefore, there is not even the assurance that the administrator's decision comports with the line agency's interpretation of the law.
*608¶ 110. Under current statutory provisions, the administrator of the DHA has become a general adjudicator of broadly ranging disputes arising under numerous statutes and administrative rules. This is the natural result of the 1977 creation of Wis. Stat. § 227.43, which began the process of bringing to the DHA the adjudication of claims arising under statutes administered by many different line agencies. This separated the "administrative and prosecutorial functions of the departments from [their] adjudicative functions," and established the potential for general adjudicative authority in the DHA. See DOT v. Office of the Comm'r of Transp., 159 Wis. 2d 271, 277-78, 463 N.W.2d 870 (Ct. App. 1990); see also 1995 Wis. Act 370, § 14 (transferring to the Department of Administration, personnel and financial resources formerly used by agencies to adjudicate disputes relating to agencies' interpretation and administration of sections of the statutes assigned to them).
¶ 111. In my view, these legislative changes have shifted the factual underpinnings that we employed in our decisions to accord deference to an agency's statutory interpretation.6 This shift causes the DHA administrator to function more like a court system that hears disputes on widely divergent topics, than like a final adjudicator for a line agency, which has more special*609ized adjudicative authority. We do not apply common law levels of deference to a court's interpretation of Wisconsin statutes. Therefore, in my view, decisions of the DHA administrator, who is by contract performing general adjudicative functions and has no special expertise in the areas of law decided by multitudes of line agencies for which the DHA administrator has become the "deciding authority," should be treated similarly to decisions of circuit courts. That is, no deference should be accorded the DELA administrator's decision.
¶ 112. The majority opinion also concludes that the common law levels of deference "are in accord with Wis. Stat. § 227.57(10)," majority op., ¶ 13, and that this shows the "legislature has thus entrusted responsibility to the agencies." Id. I disagree with both assertions. As an initial matter, there is no indication in § 227.577 that great weight deference8 should ever be accorded. In addition, we have never interpreted § 227.57(10) as being consistent, or inconsistent, with the common law standards of deference.
*610¶ 113. I also am concerned that by setting up a system of hearing examiners, often referred to as administrative law judges,9 to whom the DHA administrator and the courts may defer, the legislature may have inadvertently established a system of judges who are not accountable to the voters and whose decisions, if great weight deference is accorded, will never receive a meaningful review. This arrangement may thereby deny access to justice that the judicial branch of our tripartite system of government was meant to provide. Accordingly, I conclude that decisions of the DHA administrator should be accorded no deference.10
2. Contracts
¶ 114. This case also presents a question of contract interpretation. Therefore, I address the standard of review to be accorded an agency decision that turns on contract construction. Construction of a contract is a question of law to which we give no deference to the decision of an administrative agency. See Wisconsin End-User Gas Ass'n v. PSC, 218 Wis. 2d 558, 565, 581 N.W.2d 556 (Ct. App. 1998) (concluding that the courts are more experienced in contract construction than are administrative agencies).
B. Interpretation of Wis. Stat. § 218.0116(8)
¶ 115. The DHA administrator affirmed the decision of the DHA hearing examiner who interpreted the terms "motor vehicle dealer agreement" in Wis. Stat. § 218.0116(8) (a) as not including Racine H-D's Territory. *611The validity of this determination is affected by whether the description of Racine H-D's Territory was an "agreement" between Harley-Davidson and Racine H-D, as agreement is defined in Wis. Stat. § 218.0101(1). Section 218.0101(1) provides that an "agreement" is "a contract that describes the franchise relationship between manufacturers, distributors, importers and dealers." Therefore, the agreement of § 218.0116(8) is a contract that covers a particular relationship.
¶ 116. "Contract" is not defined in ch. 218; however, "contract" is a legal term of art to which courts apply an accepted meaning. Wis. Citizens Concerned for Cranes & Doves v. DNR, 2004 WI 40, ¶ 6, 270 Wis. 2d 318, 677 N.W.2d 612; see also Wis. Stat. § 990.01 (explaining that legal terms of art are to be given then-accepted legal meanings). A "contract" has been defined generally as an agreed set of "obligations that are enforceable or otherwise recognizable at law." Black's Law Dictionary 341 (8th ed. 2004).
¶ 117. The terms that make up a contract can be ascertained by employing well-settled legal principles of contract construction. Therefore, I would give no common law deference to the DHA administrator's statutory interpretation, as an initial matter because I conclude it is not the type of decision to which common law deference has been accorded, as I explained above, and also because, simply stated, the question to be answered is: What are the terms of the parties' contract? Neither the DHA hearing examiner nor the DHA administrator is more skilled than is a court in deciding this question. End-User Gas Ass'n, 218 Wis. 2d at 565.
C. Contract Interpretation
¶ 118. Racine H-D's Territory is described in a document separate from the Dealer Contract and the *612Conditions of Sales and Service. Therefore, common law principles of contract construction require that in order to ascertain whether this separate writing is part of Racine H-D's contract with Harley-Davidson, we must determine whether the parties intended it to be part of their contract. Gen. Cas. Co. of Wis. v. Hills, 209 Wis. 2d 167, 175, 561 N.W.2d 718 (1997). When we attempt to ascertain the terms of a contract, we begin with all writings of the parties that relate to the subject matter because all the components of a contract are not required to be set forth in one document. Appleton Papers, Inc. v. Home Indemnity Co., 2000 WI App 104, ¶ 34, 235 Wis. 2d 39, 612 N.W.2d 760. All contemporaneous writings that relate to the same contractual relationship are construed together. Wipfli v. Bever, 37 Wis. 2d 324, 326-27, 155 N.W.2d 71 (1967).
¶ 119. The zip code description of Racine H-D's Territory is a writing contemporaneous to the two signed writings, the Dealer Contract and the Conditions of Sales and Service. However, the Conditions of Sales and Service has an integration clause11 that provides: "Except as explicitly agreed in this Contract, [Harley-Davidson] has made no promises to [Racine H-D] and there are no other agreements or understandings, either written or oral, between the parties affecting this Contract... ."12 Harley-Davidson contends this integration clause prevents the written description of Racine H-D's Territory from becoming part of the contract between the parties. I disagree because, even though it is generally true that contracts that are fully integrated cannot be supplemented with additional terms, see Restatement (Second) of Contracts § 216(1) *613(1981), a contract is not completely integrated if it omits an agreed upon term that is necessary to carrying out the intent of the parties. Thomsen v. Olson, 219 Wis. 145, 151, 262 N.W 601 (1935) (concluding that the agreement to buy stock with corporate funds and distribute the shares to achieve equality of ownership for the two remaining shareholders also included the unstated terms that neither shareholder could use company funds to purchase stock that he would refuse to divide with the other shareholder).
¶ 120. Here, the parties' rights and obligations under the Dealer Contract and the Conditions of Sales and Service, to which both parties agree they are bound, cannot be fully ascertained without reference to Racine H-D's Territory. For example, Racine H-D is granted the right to "purchase and resell at retail, primarily to persons residing or doing business in the Territory assigned."13 Racine H-D had the authority to operate a retail store only within its Territory and only at the specific location approved by Harley-Davidson.14 The dealer's Territory is also the geographic area where Racine H-D was required to "effectively" sell, service and represent Harley-Davidson products.15 Racine H-D was required to actively solicit sales of Harley-Davidson merchandise "to customers within the Territory"16 and to maintain an inventory of motorcycles, parts, accessories and clothing sufficient to meet the anticipated demand "in the Territory."17 Racine H-D was obligated to advertise in newspapers, Yellow Pages, and other *614places appropriate to "the Territory."18 One of the ways that Harley-Davidson could evaluate Racine H-D's performance was to review Racine H-D's activities in its Territory. For example, Harley-Davidson could determine whether Racine H-D was advertising Harley-Davidson products in the Burlington zip code, as it contracted to do, by reviewing all advertisements Racine H-D placed. Accordingly, I conclude that the contract between Racine H-D and Harley-Davidson included the written description of Racine H-D's Territory because it is a component necessary to completely describing the rights and obligations of the parties.
¶ 121. In conclusion, even though I agree with the mandate of the majority opinion, because I disagree with its conclusion that common law standards of deference may be accorded to decisions of the DHA administrator when the administrator's decision has not been adopted by the line agency and that contract interpretation is central to the issue presented for review, I respectfully concur.
¶ 122. I am authorized to state that Justices JON E WILCOX and LOUIS B. BUTLER, JR. join this concurrence.

 Wisconsin Stat. § 218.0116(8) provides in relevant part:
(a) A manufacturer or distributor may not modify a motor vehicle dealer agreement during the term of the agreement or upon its renewal if the modification substantially and adversely affects the motor vehicle dealer's rights, obligations, investment or return on investment without giving 60 days written notice of the proposed modification to the motor vehicle dealer unless the modification is required by law, court order or the licensor.

 The DHA conducts hearings for the Department of Corrections, the Department of Health & Family Services, the Department of Workforce Development, the Department of Administration, the Department of Natural Resources, the Department of Justice, the Department of Transportation, the Department of Public Instruction, and the Department of *604Employee Trust Funds. The DHA website, http://dha.state. wi.us/home (last visited June 14, 2006).

 Even though the administrator may establish "pools of examiners responsible for certain subjects," Wis. Stat. § 227.43(lg), the record contains nothing in regard to the qualifications or experience of the hearing examiner who heard this case.

 The decisions of the DOT involve regulation of outdoor advertising, regulation of junkyards, permits to construct entrances to state highways, placement of utility lines along highways, removal of highway signage, rescinding designations of marked highway routes within a municipality, certificates of approval to construct airports, regulations of structures that could affect airport operation, annual registration fees for aircraft, closing of highways for the safe transportation of hazardous materials, granting or suspending or revoking motor vehicle dealer or manufacturer or importer licenses, allegations of misuse of temporary operation permits and plates, the DOT acts or omissions under ch. 342, licenses for driver instructors and permits for oversized vehicles and loads.

 The majority opinion relies in part on Town of Barton v. Div. of Hearings & Appeals, 2002 WI App 169, 256 Wis. 2d 628, 649 N.W.2d 293, for concluding that the legislature assigned the DHA the responsibility for enforcing Wis. Stat. § 218.0116(8). Majority op., ¶¶ 50-55. The author of this concurrence was also the author of Town of Barton; however, the question of whether common law deference should be accorded to the DHA was not presented to the court of appeals as it has been presented to the supreme court. Rather, the question in Town of Barton was whether Wis. Stat. § 86.16(1) applied to waste water pipelines *609as well as to fresh water pipelines because if it did not, then § 86.16(5) did not permit the DHA to decide the controversy. Town of Barton, 256 Wis. 2d 628, ¶¶ 11,15. The parties did not dispute whether the DHA was charged with administering § 86.16(5) when § 86.16(1) did apply.

 Wisconsin Stat. § 227.57(10) states in relevant part:
Upon such review due weight shall he accorded the experience, technical competence, and specialized knowledge of the agency involved, as well as discretionary authority conferred upon it.
I do not contrast or compare the common law doctrine of due weight deference with the phrase "due weight" in § 227.57(10) because that issue has not been briefed for the court.

 When we apply great weight deference, we affirm an agency's interpretation of a statute even though we conclude that another interpretation is more reasonable. UFE, 201 Wis. 2d at 287.

 See majority op., ¶ 23 n.21.

 See Patience Drake Roggensack, Elected to Decide: Is the Decision-Avoidance Doctrine of Great Weight Deference Appropriate in this Court of Last Resort ?, 89 Marq. L. Rev. 541 (Spring 2006).

 The Dealer Contract makes no attempt at integration.

 Conditions of Sales and Service at 20.

 Dealer Contract at 1.

 Id. at 3.

 Conditions of Sales and Service at 2.

 Id.

 Id. at 2-3.

 Id. at 9.