Arnold v. Department of Retirement Systems

• Decision Date: 07 March 1996
• Docket Number: No. 62260-4,62260-4
• Citation: 912 P.2d 463,128 Wn.2d 765
• Court: Washington Supreme Court
• Parties: Patricia ARNOLD, Respondent, v. DEPARTMENT OF RETIREMENT SYSTEMS, Petitioner.

Page 765

128 Wn.2d 765

912 P.2d 463

Patricia ARNOLD, Respondent, v. DEPARTMENT OF RETIREMENT SYSTEMS, Petitioner.

No. 62260-4.

Supreme Court of Washington,

En Banc.

March 7, 1996.

Christine O. Gregoire, Attorney General, Zera Lowe, Asst., Olympia, for petitioner.

Dianna T. Dryden, Belfair, for respondent.

Deborah Maranville, Seattle, Amicus Curiae for Northwest Womens Law Center.

TALMADGE, Justice.

Patricia Arnold challenges the constitutionality of RCW 41.26.030(6) and RCW 41.26.160, those portions of the Washington Law Enforcement Officers' and Fire Fighters' Retirement System (LEOFF) that preclude her, as the divorced spouse of a LEOFF member, from receiving a LEOFF death benefit when her ex-husband dies. We hold that the statutes in question do not deny Ms. Arnold procedural due process because she had the opportunity to seek consideration of the death benefit in her dissolution proceeding. We reverse the decision of the Court of Appeals and remand the case to the trial court for the reinstatement of its dismissal of Ms. Arnold's complaint with prejudice.

ISSUE

Are RCW 41.26.160(1) and (2) and RCW 41.26.030(6) unconstitutional because they violate Ms. Arnold's right to procedural due process?

FACTS

Patricia Arnold married Vincent Arnold in 1964. Mr. Arnold was a firefighter and a participant in LEOFF. ¹ Patricia and Vincent legally separated in 1985. In 1987, after Husband's duty disability retirement allowance is properly characterized as part community, due to its nature as, in part, replacement for general retirement benefits; and part separate, due to its nature as compensation for husband's injuries.

a job-related injury, Mr. Arnold began receiving disability retirement benefits under LEOFF. Patricia and Vincent subsequently divorced in February 1991 when Mr. Arnold was over fifty years of age, the normal LEOFF retirement age. In the dissolution decree, the trial court treated Mr. Arnold's disability retirement allowance as partly community property and partly Mr. Arnold's separate property. The court awarded Ms. Arnold 30 percent of Mr. Arnold's disability retirement allowance during his lifetime, stating:

Husband had 299 months of service credited within the retirement system; of these, 237 were accumulated during the marriage. Months accumulated during the marriage constitute a community interest; other months are the separate interest of the husband.

A fair and equitable distribution of husband's duty disability retirement benefit is for husband to take 70 percent, and wife 30 percent of the monthly LEOFF-I benefit....

Clerk's Papers at 84. Ordinarily, in a situation where a person becomes disabled after dissolution or, as in this case, legal separation, the ex-spouse is not entitled to any part of the disability payments because such payments are considered to be replacement for lost future income. In re Huteson, 27 Wash.App. 539, 543, 619 P.2d 991 (1980) (treatment of such disability payments as anything other than compensation for lost future earnings would "unfairly and permanently burden those future earnings"). ² Because Mr. Arnold was past retirement age at the time During the dissolution proceeding, Ms. Arnold sought a ruling from the trial court declaring that she was entitled to a portion of Mr. Arnold's LEOFF death benefit, or, in the alternative, that RCW 41.26.030(6) was unlawful. RCW 41.26.160 entitles the surviving spouse and minor dependents of a LEOFF member to receive a monetary allowance if the member dies on or off the job before retirement, or dies after becoming eligible for a service or disability retirement. RCW 41.26.030(6) defines "surviving spouse" as the "surviving widow or widower of a member," and specifically indicates the term "shall not include the divorced spouse of a member except as provided in RCW 41.26.162." ⁴ As a result of the dissolution, Ms. Arnold could no longer meet this statutory definition of surviving spouse in the event Mr. Arnold predeceased her. Because she could no longer be Mr. Arnold's surviving spouse, she was not eligible for the LEOFF death benefit set forth at RCW 41.26.160. The trial court concluded "the Washington State statutory scheme regarding survivorship benefits of divorced spouses is not properly before this court." ⁵ Clerk's Shortly after the entry of the dissolution decree on March 8, 1991, Ms. Arnold sent a Petition for Declaratory Ruling to the Department of Retirement Systems (DRS). She asked DRS to "amend" RCW 41.26.030(6) so that she would be included in the definition of surviving spouse. DRS responded it had no authority to change the statute or to interpret it the way Ms. Arnold suggested.

                of the dissolution, the dissolution court characterized a portion of his LEOFF disability payments as retirement income, thus entitling Ms. Arnold to a share. 3  Clerk's Papers at 30.  See In re Kollmer, 73 Wash.App. 373, 870 P.2d 978, review denied, 124 Wash.2d 1022, 881 P.2d 253 (1994)
                Papers at 31.  Ms. Arnold did not appeal this decision of the trial court
                

Ms. Arnold then commenced the present action by filing a complaint for declaratory judgment in Thurston County Superior Court, naming DRS as defendant. In the complaint, she sought as her ultimate relief a "judgment declaring that RCW 41.26.030(6) is unconstitutional." ⁶ She alleged the statute violated WASH. CONST. art. XXXI, § 1 (Amendment 61), the equal rights amendment; WASH. CONST. art. I, § 3, the due process clause; WASH. CONST. art. I, § 12, the privileges and immunities clause; and the due process clauses of the federal constitution contained in the Fifth and Fourteenth Amendments.

DRS moved for dismissal of Ms. Arnold's complaint on standing and ripeness grounds. DRS argued that Ms. Arnold had no standing because the statute she challenged would affect her only if Mr. Arnold predeceased her. As Mr. Arnold was still alive at the time, DRS contended Ms. Arnold was not yet adversely affected by the statute. DRS also argued the case was not ripe for decision because Ms. Arnold's claim to the death benefit could not ripen until Ms. Arnold then moved for summary judgment on her constitutional theories. DRS cross-moved for a summary judgment of dismissal. The trial court denied Ms. Arnold's motion and granted DRS's motion dismissing the case. The court later denied Ms. Arnold's motion for reconsideration. Ms. Arnold sought "discretionary review" in the Supreme Court, but we transferred the case to the Court of Appeals.

and if Mr. Arnold predeceased her. The trial court denied the DRS motion. ⁷

In Arnold v. Department of Retirement Sys., 74 Wash.App. 654, 658, 875 P.2d 665 (1994), Division Two rejected all of Ms. Arnold's constitutional arguments except her procedural due process theory. The Court of Appeals assumed that Ms. Arnold had an interest in the community contributions to her ex-husband's death benefit under LEOFF, id. at 665-66, 875 P.2d 665, but determined she did not have a property interest "in benefits attributable to DRS's contribution to the LEOFF fund." Id. at 668, 875 P.2d 665. The court then found her interest was entitled to constitutional protection: "Here, the death benefit statute deprives Arnold of a portion of her community contribution to the LEOFF fund without prior notice or opportunity to challenge the deprivation." Id. at 666-67, 875 P.2d 665. The Court of Appeals held that although the deprivation of the community property contribution DRS petitioned for review on the sole issue of whether RCW 41.26.160 violates due process. Pet. for Review at 1. We granted the petition. Because application of RCW 41.26.160 requires reference to the statutory definition of "surviving spouse" at RCW 41.26.030(6), both statutes are encompassed in the petition for review. Ms. Arnold did not file an answer or cross-petition raising the other constitutional issues she originally articulated in her complaint below. We decline to address those issues not properly raised in an answer to DRS's Petition for Review. RAP 13.4(d).

                to LEOFF violated neither substantive due process nor the equal rights amendment, "RCW 41.26.160(1) and (2) and RCW 41.26.030(6), insofar as they operate to deprive former spouses of their half of community contributions to the LEOFF fund without notice and a prior hearing, violate constitutional rights to procedural due process."  Id. at 667, 875 P.2d 665.   The Court of Appeals opinion does not state whether Ms. Arnold must be afforded a hearing by DRS on her interest in Mr. Arnold's LEOFF death benefit or whether the invalidation of the statutes forecloses payment of any death benefits under RCW 41.26.160
                

ANALYSIS

The Court of Appeals declared RCW 41.26.030(6) and RCW 41.26.160 to be unconstitutional because the challenged statutes deprived Ms. Arnold of her due process right to contest the loss of the LEOFF death benefit. Our courts traditionally decline to find statutes unconstitutional so facilely: "When interpreting a statute, every presumption favors the validity of an act of the Legislature, all doubts must be resolved in support of the act, and it will not be declared unconstitutional unless it clearly appears to be so." Grant v. Spellman, 99 Wash.2d 815, 819, 664 P.2d 1227 (1983).

A. Ms. Arnold's Interest in the LEOFF Death Benefit

"The requirements of procedural due process apply The question of whether there is a community property interest in a LEOFF death benefit is one of first impression in Washington. The Court of Appeals assumed Ms. Arnold had a community interest in the death benefit to the extent she could trace the benefit to community property contributions, but stated Ms. Arnold had no property interest in benefits "attributable to DRS's contributions to the LEOFF fund." Arnold, 74 Wash.App. at 668, 875 P.2d 665. DRS, however, makes no contribution to LEOFF. It administers the LEOFF fund, which consists of employee contributions, employer contributions (local police and fire departments),...