The issue for which contract actions the state has consented to be sued is an important one that the Supreme Court has not considered in a long time, and one which it should.
The issue is not as clear as the court suggests; even assuming the result in the case at bar is correct, not all the cases the court cites with approval are consistent.
In Trempealeau County v. State, 260 Wis. 602, 51 N.W.2d 499, 500-501 (1952), the Supreme Court wrote, "An action for money had and received is one at law, Gavahan v. Village of Shorewood, 200 Wis. 429, 228 N.W. 497, though ruled by equitable principles, Dunnebacke Co. v. Pitman, 216 Wis. 305, 257 N.W. 30, 32.
It is available for the recovery upon ‘legal obligations rather than equitable in the sense that they originated in the courts of law and are enforced by mean of so-called legal as distinguished from equitable remedies’. They rest ‘solely upon the universally recognized moral obligation of one who has received a benefit, the retention of which would be unjust, to make restitution.’ Dunnebacke Co. v. Pittman."
The Dunnebacke case was an unjust enrichment case. Thus, it appears that the court in Trempealeau held that the State has consented to be sued for unjust enrichment.
However, the court of appeals held to the contrary in CleanSoils Wisconsin, Inc. v. State, 229 Wis.2d 600, 599 N.W.2d 903 (Ct.App.1999). The court
acknowledged the above passage from Trempealeau, but rejected the unjust enrichment claim by distinguishing between quantum meruit an implied contract to pay reasonable compensation for services rendered from unjust enrichment an action based on the inequity of allowing the defendant to retain a benefit without paying for it. Id., at 910.
What the reason is for allowing quantum meruit, but not unjust enrichment, the court does not say. And since Trempealeau itself was not a quantum meruit case, using this ground to distinguish Trempealeau is questionable
Furthermore, the court of appeals in the case at bar seems to make no distinction between the two, stating, "[Koshick] is not seeking an amount due for goods or services that he has sold or delivered to the State (emphases added)."
Neither does the CJS, which states, "an action for debt can be maintained for the reasonable value of goods and materials where goods are sold and delivered or for specific articles or services." 26 C.J.S. Debt sec. 4 (2001).
Furthermore, the case law is full of statements that, on their face at least, would allow any contract action based solely in law and not equity, such as the case at bar:
"The statute applies only ‘to claims which, if valid, render the state a debtor, and not to equitable claims or claims for tort.’ (cites omitted)." Trempealeau, at 501. Such statements imply that the state has waived immunity from all claims sounding wholly in contract.
The Supreme Court should accept review, and clarify these issues. In the meantime, attorneys can find support in some sovereign immunity case for nearly any proposition, save that immunity has been waived for torts.
– David Ziemer
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David Ziemer can be reached by email.