77th Dist. Judge v. State

• Decision Date: 28 April 1989
• Docket Number: Docket No. 95138
• Citation: 438 N.W.2d 333,175 Mich. App. 681
• Parties: 77TH DISTRICT JUDGE, Plaintiff-Appellee, v. STATE of Michigan, Defendant-Appellant. 175 Mich.App. 681, 438 N.W.2d 333
• Court: Court of Appeal of Michigan — District of US

Page 333

438 N.W.2d 333

77TH DISTRICT JUDGE, Plaintiff-Appellee, v.STATE of Michigan, Defendant-Appellant.

Docket No. 95138.

175 Mich.App. 681, 438 N.W.2d 333

Court of Appeals of Michigan.

Submitted Dec. 2, 1987.

Decided March 8, 1989.

Released for Publication April 28, 1989.

[175 MICHAPP 683]George Van Kula, Big Rapids, in pro. per.

Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol.Gen. and Arthur E. D'Hondt and Michael A. Nickerson, Asst. Attys.Gen., for defendant-appellant.

Farhat, Story & Krause, P.C. by Max R. Hoffman, Jr., East Lansing, amicus curiae, for Michigan District Judges' Ass'n.

Before HOLBROOK, P.J., and GILLIS and TAHVONEN, ^* JJ.

HOLBROOK, Presiding Judge.

This appeal raises the question of the constitutionality of those classifications in the statutory framework for compensation of district court judges that cause more favorable treatment in compensation and benefits to be received by 36th District judges than by the other judges of this state's district court.Plaintiff, the 77th District Judge, argued in the Court of Claims that his rights to equal protection under both the United States and Michigan Constitutions, seeU.S. Const. Am. XIV, Sec. 1;Const. 1963, art. 1, Sec. 2, were violated because the distinction made between the two groups of district judges resulted in 36th District judges receiving more favorable salary terms, lesser contribution obligations to the judges' retirement system, and more generous retirement benefits than their counterparts in other districts.The Court of Claims agreed with plaintiff, declared the offending statutory disparities unconstitutional, awarded plaintiff damages, and ordered that plaintiff's compensation, retirement contribution[175 MICHAPP 684] obligations, and retirement benefits be fixed at levels equivalent to that of a 36th District judge beginning January 1, 1987.DefendantState of Michigan appeals as of right.The Michigan District Judges' Association, acting as amicus curiae, joins with plaintiff in urging this Court to affirm the Court of Claims.Although we agree that the statutory scheme is violative of equal protection, we conclude that damages are inappropriate as a matter of law and that the Court of Claims lacked jurisdiction to afford plaintiff any other form of relief.

I

The facts demonstrating disparate treatment between 36th District judges and other district judges are stipulated.The disparate treatment is statutorily effected in three asserted respects.First, in regard to the salary disparity, all district judges receive from the state a base salary equal to ninety percent of the base salary payable by the state to a circuit judge.M.C.L. Sec. 600.8202(1);M.S.A. Sec. 27A.8202(1).This base salary is supplemented by an additional salary pursuant to M.C.L. Sec. 600.8202(2);M.S.A. Sec. 27A.8202(2), which provides in pertinent part:

"In addition to the salary received from the state, a district judge may receive from a district control unit in which the judge regularly holds court an additional salary as determined by the governing legislative body of the district control unit.Supplemental salaries paid by a district control unit shall be uniform as to all judges who regularly hold court in the district control unit.In the thirty-sixth district each district judge shall receive an additional salary which, when added to the annual salary paid by the state under subsection (1), equals 88% of the annual salary of a justice of the [175 MICHAPP 685]supreme court.The total annual additional salary paid to a district court judge by the district control units in which the judge regularly holds court shall not cause the district judge's total annual salary received from state and district control unit funds to exceed 88% of the annual salary of a justice of the supreme court."

The same statute further provides that the state shall reimburse the district control unit for "a portion of that additional salary in an amount provided by law."M.C.L. Sec. 600.8202(9);M.S.A. Sec. 27A.8202(9).

The claimed disparity in salaries stems from the mandate in the above statute that the 36th District judges' aggregate of base and supplemental salary must equal the statutory ceiling of eighty-eight percent of the salary of a Supreme Court justice, but that the other district judges receive an amount somewhere between the state-provided ninety percent of the base salary of a circuit judge and the statutory ceiling, depending on discretionary determinations of the district control unit (as to the amount of the supplemental salary) and the Legislature(as to the appropriation of a reimbursement to the district control unit).Thus, plaintiff judge received a salary of $53,860 in 1985, but each 36th District judge received $66,950 for the same year.

Second, the statutory provisions for the judges' retirement system creates a disparity in its imposition of the levels of funding obligations imposed upon the member judges.All district court judges, except for 36th District judges, are required to contribute 3.5 percent of their state-paid base salary to the annuity savings fund.M.C.L. Sec. 38.820(2)(a);M.S.A. Sec. 27.125(20)(2)(a).However, a judge may choose to expand the amount of his eventual retirement benefits by exercising one or both of [175 MICHAPP 686] two options to convert part of the state salary standardization payment made by the state to the district control unit to subsidize the judge's additional salary component.The converted amount is included as part of the "final salary" used as the basis for computation of benefits.The two options available to the district judge are (1) to convert $2,250 of the annual state salary standardization payment, M.C.L. Sec. 38.814a;M.S.A. Sec. 27.125(14a), and (2) to convert that remaining portion of the annual state salary standardization payment which, when added to the $2,250 from the first option, will not exceed forty percent of the difference between the judge's total salary (aggregate of state-paid base salary and additional salary) and his base salary, M.C.L. Sec. 38.814c;M.S.A. Sec. 27.125(14c).If the judge exercises only the first option, his annual contribution to the fund is 3.5 percent of the sum of his base salary and the converted $2,250.M.C.L. Sec. 38.820(2)(a) and (b);M.S.A. Sec. 27.125(20)(2)(a) and (b).If both options are exercised, then the judge's annual funding obligation is seven percent of the combined base salary and the converted portions of the state salary standardization payment.M.C.L. Sec. 38.820(2)(c);M.S.A. Sec. 27.125(20)(2)(c).

The foregoing does not apply to 36th District judges, and a different, more favorable funding obligation inures to their benefit.Their annual contribution is 3.5 percent of their total salary (which, as previously noted, is fixed at eighty-eight percent of the salary of a Supreme Court justice).The conversion options are expressly made inapplicable to 36th District judges, who, as it turns out, do not need them because their eventual benefits under the judges' retirement system are more favorable than the benefits of the other district judges, including those who exercise both conversion options.M.C.L. Sec. 38.814a(3);M.S.A. Sec. 27.125(14a)(3), [175 MICHAPP 687]M.C.L. Sec. 38.814c(3);M.S.A. Sec. 27.125(14c)(3).Thus, the statutory scheme creates a disparity by its imposition of a 3.5 percent funding requirement applied to a 36th District judge's total salary, as compared to the seven percent funding requirement applied to those other district judges who exercise both conversion options.By way of illustration, plaintiff's contribution for 1985, computed as seven percent of the sum of his $38,460 base salary plus $11,965 converted salary, was $3,529.75.The contribution of a 36th District judge, computed as 3.5 percent of an aggregate salary of $66,950, was $2,343.25.

Third, 36th District judges receive more generous benefits from the system upon their retirement.In the usual case, a retiring member receives a fixed percentage of his "final salary" as his annuity benefit.M.C.L. Sec. 38.814;M.S.A. Sec. 27.125(14)."Final salary" is defined more beneficially for 36th District judges vis-a-vis other judges:

" 'Final salary' means the annual rate of salary paid by the state at the time of his or her retirement to a judge, except a judge of the district court in the thirty-sixth district who does not participate in the retirement system established by the city of Detroit, or as otherwise provided in this subdivision....In addition, 'final salary' shall include the $2,250.00 of the state salary standardization payment if converted pursuant to section 14a,[ ¹] and the balance of the state salary standardization payment if converted pursuant to section 14c.[ ²] For each judge of the district court in the thirty-sixth district who does not participate in the retirement system established by the city of Detroit, 'final salary' means the total annual rate of salary paid by the state and the district control unit of the thirty-sixth district to the judge at the [175 MICHAPP 688] time of his or her retirement."M.C.L. Sec. 38.802(m);M.S.A. Sec. 27.125(2)(m).

Thus, the final salary of a 36th District judge for purposes of retirement benefits is equivalent to his aggregate salary of eighty-eight percent of the salary of a Supreme Court justice, but benefits of the other district judges are computed with reference to a lesser amount comprised of the state-paid base salary plus converted amounts of the state salary standardization payment.The result in the instant case would be an annual retirement benefit of $33,475 for a 36th District judge, assuming his retirement after twelve years of continuous service, his attainment of age sixty at the time of retirement, and his nonparticipation in the retirement system established by the City of Detroit.Under the same set of assumptions, a district judge serving in plaintif...