66 Op. Att'y Gen. 302 (1977)
 
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OPINION NO. OAG 91-77,

Wisconsin Attorney General Opinions

8 November 1977

Automobiles And Motor Vehicles;
Confidential Reports;
Licenses And Permits;
Motor Vehicle Department;
Motor Vehicles;
Open Meeting;
Public Records;
Salvage Dealers;

Financial statements required by law to be
filed with Department of Transportation in
connection with applications for motor
vehicle dealers' and motor vehicle salvage
dealers' licenses are public records and are
subject to inspection and copying under
Section 19.21(2), Stats., subject to
limitations contained in court cases cited.

DALE CATTANACH,
Secretary, Department of Transportation

Your predecessor requested my opinion
concerning the applicability of the Wisconsin
public records statute, Section 19.21,
Stats., to certain records received and
maintained by the Division of Motor Vehicles.

He stated that under Chapter 218, applicants
for motor vehicle dealers' licenses and
applicants for motor vehicle salvage dealer
licenses must submit certain financial
information to the Division.

Your question is whether such financial
information is confidential and therefore
not subject to inspection and copying
by the general public.

In my opinion, such statements are public
records, are not automatically confidential
and are available for public inspection and
copying subject to the limitations contained
in
State ex rel. Youmans v. Owens,
28 Wis.2d 672,
137 N.W.2d 470 (1965),
139 N.W.2d 241 (1966), and

Beckon v. Emery,
 36 Wis.2d 510,
153 N.W.2d 501 (1967).

Section 16.61(2)(a), Stats., defines
public records of a state agency as:

16.61(2)(a)

     "Public records" means all books,
     papers, maps, photographs, films,
     recordings, or other documentary
     materials or any copy thereof,
     regardless of physical form or
     characteristics, made, or received
     by any agency of the state or its
     officers or employes in connection
     with the transaction of public
     business and retained by that
     agency or its successor as evidence
     of its activities or functions
     because of the information
     contained therein; except the
     records and correspondence of any
     member of the state legislature.

 
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Section 19.21(1) and (2), Stats., provides:

19.21(1)

     Each and every officer of the state
     . . . is the legal custodian of and
     shall safely keep and preserve all
     property and things received from his
     predecessor or other persons and
     required by law to be filed, deposited,
     or kept in his office, or which are in
     the lawful possession or control of
     himself or his deputies, or to the
     possession or control of which he or
     they may be lawfully entitled,
     as such officers.

19.21(2)

     Except as expressly provided otherwise,
     any person may with proper care, during
     office hours and subject to such orders
     or regulations as the custodian thereof
     prescribes, examine or copy any of the
     property or things mentioned in
     Subsection 19.21(1).

     Any person may, at his own expense and
     under such reasonable regulations as the
     custodian prescribes, copy or duplicate
     any materials, including but not limited
     to blueprints, slides, photographs and
     drawings.

     Duplication of university expansion
     materials may be performed away from the
     office of the custodian if necessary.

The financial statements involved
are required by law to be filed
with the division, so they qualify
as "property or things" under this statute.

I am unaware of any statute or constitutional
provision which would make the financial
statements confidential or absolutely
privileged and which therefore would
exclude them from the disclosure
requirement of Section 19.21(2).

In the absence of statutory or constitutional
exception, the disclosure requirements of
Section 19.21(2) apply.

This does not mean, however, that the
financial statements are subject
to automatic disclosure.

In a 1974 opinion from this office, we
commented at length on the criteria for
permitting or denying public access to
records.

That opinion,
63 Op. Att'y Gen. 400, 405-406 (1974),
contains the following summary:

     The leading Wisconsin cases governing
     the right to public access are

     State ex rel. Youmans v. Owens (1965),
     28 Wis.2d 672, 137 N.W.2d 470 and
     Beckon v. Emery (1967),
     36 Wis.2d 510, 153 N.W.2d 501.

 
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These cases essentially hold,
as elaborated in

58 OAG 67 (1969),
60 OAG 9 (1971),
60 OAG 43 (1971),
60 OAG 284 (1971),
60 OAG 470 (1971),
61 OAG 12 (1972),
61 OAG 361 (1972),

that:

1.   The public right to full access to all
     public records provided for in Section
     19.21(2), Stats., is qualified in the
     following respects:

     a.   The right to inspect is subject to
          such reasonable regulations with
          respect to hours, procedure, etc.,
          that the custodian may prescribe
          to limit unreasonable interference
          with the ordinary operations of his
          office

     b.   The right may be limited or denied
          by express statutory provision.

     c.   The custodian may and has a duty to
          deny inspection where he determines
          that permitting inspection would
          result in harm to the public
          interest which outweighs any
          benefit that would result
          from granting inspection.

          Specific reasons must be given
          when inspection is withheld and the
          person seeking the same can then
          resort to court action to test the
          sufficiency of such reasons.

          Statements that the  records are
          confidential" or that permitting
          inspection would be "contrary to
          the public interest" are merely
          legal conclusions and are not a
          substitute for the specific reasons
          which must be given in each case.

          In testing the sufficiency of a
          stated specific reason, the trial
          judge would examine the record or
          document in camera and would
          determine "whether or not the
          harm likely to result to the
          public interest by permitting
          the inspection outweighs the
          benefit to be gained by
          granting inspection.

          State ex rel. Youmans. supra,
          Page 682. Where no specific
          reason was given for
          withholding inspection

          "the writ of mandamus compelling
          its production should issue as a
          matter of course."

          Beckon v. Emery, supra, p. 518.

2.   Any member of the public, regardless of
     his motives, has a right to inspect any
     public record, subject to the
     three limitations stated above.

 
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     This does not mean that the custodian or
     court cannot consider the claimed or
     stated purpose for which the record is
     to be used in balancing the interests.

     See
     United States v. Richard M. Nixon
     418 U.S. 683 (1974).

3.   ... public policy, and hence the public
     interest, favors the right of inspection
     of documents and public records.

     it is only in the unusual or exceptional
     case, where the harm to the public
     interest that would be done by divulging
     matters of record would be more damaging
     than the harm that is done to public
     policy by maintaining secrecy, that the
     inspection should be denied.

     Beckon v. Emery, supra, p. 516.

4.   The custodian should make his
     determination on a case-by-case basis in
     view of the record  involved and the
     circumstances then and there existing.

In Youmans the court declined to catalog the
situations which might justify refusal but
stated that Section 19.21, Stats., will be
construed in pari materia with Section 66.77,
Stats., the Wisconsin open meeting law, and
that the policy guidelines for holding closed
meetings contained in Section 66.77(4),
Stats., as recreated by Chapter 297, Laws of
1973, will be applicable to the question of
sufficiency of stated reason for withholding
inspection  under Section 19.21, Stats.

We will not set forth the detailed provisions
of Section 66.77(4), Stats., here. . . . The
Youmans case did point out that other common
law exceptions may justify withholding of
access; including documentary evidence in
the hands of a district attorney, minutes
of a grand jury, evidence in a divorce action
sealed by the court and information gathered
under a pledge of confidentiality. . . . . .

In State ex rel. Joan Dalton v. Mundy,
Director of Institutions and Depts. of Milw.
Co., et al., 80 Wis.2d 190, 257 N.W.2d 877
(October 4, 1977), the court reaffirmed its
holding in Beckon that the public interest
favors the right of inspection of
documents and public records.

The Youmans case makes the exceptions under
the open meeting law (now revised and
renumbered Subchapter IV of Chapter 19 by
Chapter 426, Laws of 1975) relevant in
determining whether, in individual cases,
to disclose public records.

 
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The determination must be case-by-case; so
although an exception under the open meeting
law may justify a particular withholding, it
cannot be used as the basis for a blanket
rule prohibiting the disclosure of certain
documents.

In each case, the custodian must determine
whether the harm to the public interest
outweighs any benefit that would result from
granting inspection, while keeping in mind
that public policy favors inspection.

In my opinion neither the exemption set forth
in Section 19.85(1)(b), Stats., permitting a
closed session where licensing is involved,
nor the exemption in Section 19.85(1)(f),
Stats., permitting a closed session when
"Considering financial, medical, social or
personal histories . . which, if discussed in
public, would be likely to have a substantial
adverse effect upon the reputation of any
person referred to" (emphasis added), would
justify refusal to permit examination and
copying of the records involved, except in a
most unusual case.

See 60 Op. Att'y Gen. 470, 479 (1971), as to
exemption in Section 19.85(1)(f).

With respect to motor vehicle dealers,
Section 218.01(2)(b), Stats., provides in
part that:

218.01(2)(b)

     . . . The licensor may require in
     such application, or otherwise,
     information relating to the
     applicant's solvency, his financial
     standing or other pertinent matter
     commensurate with the safeguarding
     of the public interest in the
     locality in which said applicant
     proposes to engage in business, all
     of which may be considered by said
     licensor in determining the fitness
     of said applicant to engage in
     business as set forth in this
     section."

With respect to motor vehicle salvage
dealers, Section 218.21(1), Stats.,
contains language similar to that in
Section 218.01(2)(b), Stats., above, and in
addition, Section 218.21(4), Stats.,

provides:

     Every application shall be accompanied
     by a current financial statement to
     determine the applicant's solvency as
     required under Subsection 218.21(1).
 

The Department may require a bond when there
is reasonable doubt as to the financial
ability of the licensee.

Sections 218.01(2)(h) and 218.21(6), Stats.
Section 218.22(1), Stats., provides that the
licensor shall only issue a motor vehicle
salvage dealer's license when it is

     "satisfied that the applicant
      is financially solvent and
      of good character."

Among numerous grounds for denial, suspension
or revocation of either type of license are:

"Proof of unfitness" and "Material
misstatement in application for license."

See Sections 218.01(3) and 218.22(3), Stats.


 
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The filing of the financial data and
information as to solvency is for
the purpose of "safeguarding of
the public interest."

The licensor and licensee are not parties
which have exclusive interest in access
to such public records.

Members of the public who have done or
contemplated doing business with the
applicant have an interest.

Other members of the public, including
competitors of the applicant, may well be in
a position to alert the licensor to material
misstatements in the information filed.

Under Section 19.21(2), Stats., no showing of
interest is required as a prerequisite to
inspection.

See 63 Op. Att'y Gen. 400, 406 (1974).

The exemption in the open meeting statute
permitting closed sessions where open
discussion of financial data

     would be likely to have a
     substantial adverse effect
     upon the reputation of any
     person referred to is not
     designed as a protection
     from competition.

The somewhat similar provision in former
Section 14.90(3)(e), Stats. (1965),
used the phrase

    "which may unduly damage reputations."

In State ex rel. Youmans, supra, p. 685, the
court placed great emphasis on the word
"unduly" and held that as applied to public
records, it did not bar all inspection of
public records which might in some degree
damage reputations.

Under present Sections 19.21(2) and
19.85(1)(f), Stats., denial of inspection
would not be justified in every case where
disclosure might have an adverse effect upon
the reputation of the person, but is proper
only where inspection of the financial data

   "would be likely to have a substantial
    adverse effect upon the reputation of
    any person referred to."

Since the financial statements are required
by law as a condition for issuance of the
licenses, the Department cannot pledge to
keep the information confidential.

BCL:RJV

 
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