Statutory Interpretation

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WI Supreme Court

Case Name: Tetra Tech EC, Inc., et al. v. Wisconsin Department of Revenue

Case No.: 2018 WI 75

Focus: Statutory Interpretation

The Wisconsin Department of Revenue (the “Department”) imposed a tax on the petitioners pursuant to Wis. Stat. § 77.52(2)(a)11. (2007-08) for the “processing” of river sediments into waste sludge, reusable sand, and water. The petitioners say the statutory term “processing” is not expansive enough to cover the separation of river sediment into its component parts, and so they asked us to reject the Department’s interpretation of that term.

Because resolving this question implicates the authoritativeness of an administrative agency’s interpretation and application of a statute, we asked the parties to also address this issue: “Does the practice of deferring to agency interpretations of statutes comport with Article VII, Section 2 of the Wisconsin Constitution, which vests the judicial power in the unified court system?”

We conclude that the term “processing” in Wis. Stat. § 77.52(2)(a)11. includes the separation of river sediment into its component parts. Therefore, we affirm the court of appeals. We have also decided to end our practice of deferring to administrative agencies’ conclusions of law. However, pursuant to Wis. Stat. § 227.57(10), we will give “due weight” to the experience, technical competence, and specialized knowledge of an administrative agency as we consider its arguments.

Affirmed

Concur: A.W. BRADLEY, J., concurs, joined by ABRAHAMSON, J. (opinion filed). ZIEGLER, J., concurs. ROGGENSACK, C.J., joins Part I (opinion filed). GABLEMAN, J., concurs, joined by ROGGENSACK, C.J. (opinion filed).

Dissent:

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.