Maple Grove Country Club Incorporated, Plaintiff-Appellant-Petitioner, County of La Crosse, Involuntary-Plaintiff,
Maple Grove Estates Sanitary District, Defendant-Respondent.
SUBMITTED ON BRIEFS: ORAL ARGUMENT February 21, 2019
OF DECISION OF THE COURT OF APPEALS Reported at 382 Wis.2d
270, 915 N.W.2d 729
Circuit Court La Crosse county No. 2014CV389 Elliott M.
the plaintiff-appellant-petitioner, there were briefs filed
by Mark J. Steichen and Boardman & Clark LLP, Madison;
with whom on the brief is Patrick J. Houlihan and Lawyers At
Work, LLC, LaCrosse. There was an oral argument by Mark J.
the defendant-respondent, there was a brief filed by Kraig A.
Byron and Von Briesen & Roper, S.C., Madison. There was
an oral argument by Kraig A. Byron.
WALSH BRADLEY, J.
The petitioner, Maple Grove Country Club, Inc., seeks review
of an unpublished, per curiam decision of the court of
appeals affirming the circuit court's order that
dismissed the Country Club's inverse condemnation claim
against Maple Grove Estates Sanitary District. The Country Club
asserts that the court of appeals erred in upholding the
dismissal based on its noncompliance with Wis.Stat. §
893.80(Id.) (2013-14),  the notice of claim statute,
despite the fact that the Sanitary District did not raise
noncompliance with the statute in a responsive pleading.
Specifically, the Country Club contends that noncompliance
with the notice of claim statute is an affirmative defense
that must be set forth in a responsive pleading lest it be
waived and that it cannot instead be initially raised by
motion. Conversely, the Sanitary District argues that
noncompliance with the notice of claim statute is a
jurisdictional prerequisite to filing suit and is not waived
by the failure to plead it as an affirmative defense in a
We conclude that noncompliance with the notice of claim
statute is an affirmative defense that must be set forth in a
responsive pleading. Because the Sanitary District failed to
set forth the defense in its answer and it has not amended
its answer to include it, such a defense is deemed waived.
Accordingly, we reverse the decision of the court of appeals
and remand to the circuit court for further proceedings. I
In 1978, the Town of Hamilton formed the Sanitary District.
Approximately twelve years later, Tony Ceresa, the Country
Club's predecessor in title,  constructed a sewage
treatment plant along with related collection and outflow
facilities for the purpose of serving the Country Club
propertyalong with a residential development.
The sewer system was initially operated by the Country Club.
However, the Town provided for the election of Sanitary
District commissioners in 1997 and took over operation of the
system in 1998. At that time, the Sanitary District adopted a
"Sewer Use and User Charge Ordinance," which
obligated the Sanitary District to either lease or purchase
the sewer system from the Country Club.
Consequently, the Sanitary District and the Country Club
entered a five-year lease, ending on December 31, 2004. Prior
to the expiration of the initial lease, the parties
negotiated a second five-year lease, extending the term to
December 31, 2009.
As the second lease neared its end, the Country Club informed
the Sanitary District that it did not wish to renew the
lease. Instead, the Country Club determined that it was in
its "best interest to sell the Sanitary District
facility and collection system."
Likewise, the Sanitary District determined that it would not
be renewing the lease, and informed the Country Club of this
position by letter. It explained that "[t]he Board of
Commissioners is not in a position to enter into any kind of
long term agreement until we have an examination of the
collection system and broader understanding as to what will
be required by the DNR in regard to upgrades to the
wastewater treatment plant" and that money would need to
be set aside for improvements.
The Country Club responded to the Sanitary District with a
letter of its own. It indicated that it was willing to either
sell or continue leasing the sewer system to the Sanitary
District, but that payment of some kind would be necessary:
Given the fact that I am relatively certain that the
Town/District is not going to build a new sanitary facility,
that means that the District will continue to use Maple
Grove's sanitary facility. Obviously, they have to pay a
lease payment for that. If their intent is to operate it
without paying any rent, then essentially the Town/Sanitary
District is condemning, i.e. taking for a public purpose, the
private property of Maple Grove Country Club. The law
requires that the District would pay Maple Grove Country Club
a fair market value for the facility.
Despite further communications and offers between the
parties, no agreement was reached before the lease expired.
The Sanitary District continued to physically occupy and
operate the sewer system, and has not paid any rent to the
Country Club since 2010.
On July 19, 2011, the Country Club served the Sanitary
District with a document entitled "Notice of
Circumstances of Claim Pursuant to Wis.Stat. § 893.80(1)
(a)." The notice stated that "the Sanitary
District refuses to negotiate a fair and equitable purchase
price, Lease Agreement, and/or User Agreement with respect to
said Wastewater Treatment facility . . . ." It further
asserted that the Sanitary District "continues to occupy
and use said property belonging to Claimant contrary to
Section 32.10, Wis. Stats.,  and Article I, Section 13 of the
Wisconsin Constitution" without paying any rent or just
compensation. The notice specified that no claim for
damages was made "at this time." The Sanitary
District did not respond to the Notice of Circumstances of
Almost three years after filing the Notice of Circumstances
of Claim, the Country Club initiated this action in the
circuit court. It brought two causes of action against the
Sanitary District, one for inverse condemnation and the other for
unlawful sanitary sewer charges and levy of taxation. In its
complaint, the Country Club asserted that it had
"provided the requisite notice under Section 893.80,
Wis. Stats[, ]" specifically referencing the July 19,
2011, Notice of Circumstances of Claim.
The Sanitary District filed an answer to the complaint, as
well as a counterclaim. In its answer, it raised six
affirmative defenses: (1) the Country Club failed to state a
claim for which relief can be granted; (2) the Country
Club's claims are barred by the doctrine of laches; (3)
the applicable statute of limitations bars the claims; (4)
sovereign immunity bars the Country Club's claims; (5)
the claims are barred by the doctrine of res judicata; and
(6) the Country Club lacks standing. It denied the Country
Club's allegation that the notice of claim statute had
been complied with, but did not affirmatively plead that the
Country Club had failed to comply with the statute.
Both parties filed summary judgment motions. The Sanitary
District sought summary judgment on its counterclaim that it
was entitled to recover delinquent sanitary sewer charges
from the Country Club. Conversely, the Country Club argued
that it was entitled to partial summary judgment declaring
that the Sanitary District had acquired the Country
Club's property via inverse condemnation.
In its brief opposing the Country Club's motion for
partial summary judgment, the Sanitary District raised an
assertion that the Country Club had failed to comply with the
notice of claim procedures set forth in Wis.Stat. §
893.80. The Sanitary District argued that the Notice of
Circumstances of Claim filed by the Country Club suffered
from two defects: that it was not timely filed and that it
did not contain an itemized statement of the relief sought as
is required by § 893.80(1d) (b) . In response,
the Country Club contended that the Sanitary District had
waived the defense of noncompliance with the notice of claim
statute by failing to plead the defense in its answer.
After holding an evidentiary hearing, the circuit court
dismissed the Country Club's inverse condemnation claim.
It concluded that the Country Club had failed to comply with
the notice of claim statute. Specifically, it determined that
the notice was "untimely and incomplete." In the
circuit court's view, the notice was untimely because it
was received over 120 days after the event giving rise to the
claim and it was incomplete because it did not include an
itemized statement of the relief sought. The circuit court
did not address the Country Club's argument that the
Sanitary District had waived the defense.
The Country Club sought leave to file an interlocutory
appeal, and the court of appeals granted its
petition. On appeal, the court of appeals limited
the issues to "whether the Sanitary District waived its
notice of claim defense by failing to plead it, and whether
the District's answer should be considered as amended to
present that defense so as to conform to the evidence, under
Wis.Stat. § 802.09(2)."
Ultimately, the court of appeals affirmed the circuit
court's dismissal of the inverse condemnation claim. It
determined that the "Sanitary District did not waive its
notice of claim defense by failing to plead it."
Maple Grove Country Club Inc. v. Maple Grove Estates
Sanitary Dist., No. 2 016AP22 96, unpublished slip op.,
¶l (Wis. Ct. App. Apr. 19, 2018) (per curiam).
The court of appeals reached this conclusion with significant
reservations. Specifically, it determined that it was bound
to follow Lentz v. Young, 195 Wis.2d 457, 536 N.W.2d
451 (Ct. App. 1995), even though it "questioned"
the correctness of the Lentz decision. Maple
Grove Country Club, No. 2016AP2296, unpublished slip
In reviewing relevant case law, the court of appeals observed
Lentz's broad and unqualified holding that
"a defendant may raise an affirmative defense by
motion." Id., ¶5 (quoting Lentz,
195 Wis.2d at 467) . Following Lentz, it concluded
that "the District preserved its notice of claim
affirmative defense by raising it on summary judgment."
Maple Grove Country Club, No. 2016AP2296,
unpublished slip op., ¶6.
However, the court of appeals opined that
"Lentz almost certainly misinterpreted prior
case law in a way that is not consistent with relevant
statutes." Id., ¶7. Namely, it stated that
"[t]he statutes do not appear to contemplate that
affirmative defenses will be asserted for the first time in a
motion for summary judgment that follows the
pleadings." Id., ¶8.
In conclusion, the court of appeals summarized its concern
that Lentz upends the statutory scheme:
In summary, the seemingly unqualified rule that was applied
in Lentz obliterates the statutory scheme.
Lentz replaces that scheme with a simple rule that
affirmative defenses need not be pled, but instead need only
be raised by motion before trial. But Lentz does not
cite any statute or case law that supports such a rule.
Nonetheless, we are bound by our own prior decision and may
not overrule, modify, or withdraw its language. Cook v.
Cook, 208 Wis.2d 166, 189-90, 560 N.W.2d 246 (1997) . We
are permitted to "signal" our "disfavor,"
but may not overrule the prior decision. Id. at 190.
Maple Grove Country Club, No. 2016AP2296,
unpublished slip op., ...