Bilda v. Milwaukee County
| Citation | 2006 WI App 159,722 N.W.2d 116 |
| Decision Date | 20 July 2006 |
| Docket Number | No. 2005AP52.,2005AP52. |
| Parties | Geoffrey L. BILDA, Individually, and as representative of a class consisting of all sworn Milwaukee County Deputy Sheriffs who are members of the Milwaukee County Deputy Sheriffs' Association, and Virginia Schumann, Individually, and as representative of a class consisting of all Milwaukee County Employes' Retirement System members who filed an application for retirement prior to January 1, 2001, but whose retirement is effective on or after January 1, 2001, all retired members and beneficiaries of members of the Milwaukee County Employes' Retirement System receiving pension benefits prior to January 1, 2001, and all those members of the Milwaukee County Employes' Retirement System eligible for deferred vested retirement effective January 1, 2001, Plaintiffs-Appellants,<SMALL><SUP>†</SUP></SMALL> Frank Liska, Randy Tylke, and Dennis Marchewka, Individually, and as representatives of a class consisting of all persons who are non-represented employees of Milwaukee County, members of the Milwaukee County Employes' Retirement System (ERS), and who are entitled to back-drop pension benefits under Sections 5.15 and 5.16 of Section 201.24 of the General Ordinances of Milwaukee County, Intervenors-Plaintiffs-Respondents, v. MILWAUKEE COUNTY and Milwaukee County Employes' Retirement System Pension Board, Defendants-Respondents, Milwaukee County District Council 48, AFSCME, AFL-CIO, Wisconsin Federation of Nurses and Health Professionals, AFT, AFL-CIO, Association of Milwaukee County Attorneys, Milwaukee County Fire Fighters' Association, Local 1072, IAFF, AFL-CIO, and Technicians, Engineers & Architects of Milwaukee County (TEAMCO), Intervenors-Defendants-Respondents. |
| Court | Court of Appeals of Wisconsin |
On behalf of the plaintiffs-appellants, the cause was submitted on the briefs of John F. Fuchs, Esq. of Fuchs, DeStefanis & Boyle, S.C. and Eugene O. Duffy, Esq. and Kerry E. Dwyer, Esq. of O'Neil, Cannon, Hollman, DeJong, S.C., Milwaukee.
On behalf of the defendants-respondents Milwaukee County and Milwaukee County Employes' Retirement System Pension Board, the cause was submitted on the brief of Scott W. Hansen, Steven P. Bogart, Joseph W. Voiland, and Amy L. Reichelt of Reinhart Boerner Van Deuren, S.C., Milwaukee.
On behalf of the defendant-respondent Employes' Retirement System of the County of Milwaukee, the cause was submitted on the brief of Emery K. Harlan, Elizabeth A. McDuffie, and Bethany McCurdy of Gonzalez, Saggio & Harlan, L.L.P., Milwaukee.
On behalf of the intervenor-defendant-respondent Milwaukee County District Council 48, AFSCME, AFL-CIO, the cause was submitted on the brief of Mark A. Sweet of Law Offices of Mark A. Sweet, LLC, Milwaukee.
On behalf of the intervenors-defendants-respondents Wisconsin Federation of Nurses and Health Professionals, AFT, AFL-CIO, Association of Milwaukee County Attorneys, Milwaukee County Fire Fighters' Association, Local 1072, IAFF, AFL-CIO, and Technicians, Engineers & Architects of Milwaukee County (TEAMCO), the cause was submitted on the brief of Jeffrey P. Sweetland of Hawks Quindel Ehlke & Perry, S.C., Milwaukee.
Before LUNDSTEN, P.J., DYKMAN and VERGERONT, JJ.
¶ 1
This is a class action brought against Milwaukee County and the Employes' Retirement System Pension Board alleging that changes to the Milwaukee County ordinances governing the retirement system constituted a taking of the class members' property interest without just compensation in violation of the Wisconsin Constitution. The suit was brought by Geoffrey Bilda and Virginia Schumann (collectively referred to as Bilda), individually and as representatives of two classes of members of the Milwaukee County Employes' Retirement System.1 The county ordinance they challenge, Ordinance 00-15, enhanced benefits for some but not all participants in the retirement system and reduced the vesting period for benefits from ten to five years. Bilda argues that this ordinance and its implementation constitute an unconstitutional taking. The circuit court granted Milwaukee County's summary judgment motions and denied Bilda's cross-motion for summary judgment. Bilda appeals the orders granting summary judgment and several other circuit court orders. Bilda makes the following arguments:
(1) The circuit court erred in concluding that there was no unconstitutional taking for the following reasons:
a) The County, in enacting Ordinance 00-15, failed to comply with 1965 Wis. Laws, ch. 405. Because the ordinance is void, the County's actions pursuant to the ordinance were an unconstitutional taking. The circuit court erred when it determined that the County complied with ch. 405.
b) Once enacted, the County's actions pursuant to Ordinance 00-15 constitute a taking because the actions deplete the retirement system's reserves and render the system less secure. The circuit court erred in concluding that implementation of the ordinance did not constitute an unconstitutional taking.
c) The retirement system improperly paid legal fees to the law firm of Reinhart Boerner Van Deuren, S.C., for work performed on behalf of Milwaukee County and the payment of these fees is an unconstitutional taking. The circuit court did not rule on this issue.
(2) When considering the summary judgment motions, the circuit court erred in excluding an affidavit from one of Bilda's legal experts.
(3) The circuit court erred in concluding that the Pension Board is not a proper party to the litigation.
(4) The circuit court erred by denying Bilda's motion to disqualify the Reinhart law firm due to a conflict of interest.
(5) The circuit court erred by failing to provide unnamed class members notice and the opportunity to opt out of the suit.
We reject each of Bilda's arguments and affirm the circuit court.
¶ 2 The Milwaukee County Employes' Retirement System is a defined benefit pension plan for county employees.2 Participant benefits are determined by several factors, including years of service, a final average salary figure, and benefit multipliers. The system is funded by ongoing County contributions and investment returns on money held in the system. Because the benefits payable to the class members here are "defined," those benefits do not vary based on the performance of the system's investments, the amount of the County's contributions, or changes in benefits to other categories of participants.3
¶ 3 In the fall of 2000, the director of human resources for Milwaukee County, Gary Dobbert, suggested pension benefit enhancements for certain classes of employees, not including the plaintiff classes.4 The ordinance containing the proposed amendments — Ordinance 00-15 — included the following: (1) a change in the method of calculating the final average salary used to calculate pension benefits for participants hired before January 1, 1982, that produced a higher average salary and, therefore, a higher defined benefit; (2) an increase in the pension benefit multipliers used in calculating pension benefits for participants hired on or after January 1, 1982; (3) a reduction in the vesting period so that participants' pension benefits would vest after five years rather than ten; and (4) the creation of an optional "back-DROP" program which allowed vested participants to obtain a lump-sum payment upon retirement followed by reduced monthly payments, rather than receiving "full" monthly payments. Ordinance 00-15 did not affect the County's obligation to fund the benefit system or to pay benefits.
¶ 4 Director Dobbert referred the proposed amendments to the County's Pension Study Commission (the Commission). The Commission reviewed the proposed ordinance in a meeting on October 27, 2000. At that meeting, commission members questioned Dobbert and two members of the retirement system's independent actuary firm, Dennis Skelly and Glenn Soderstrom, regarding the proposed changes. The Commission received a letter from Skelly, including cost estimates for most of the changes, and a memo from Dobbert. The Dobbert memo outlined all of the changes, stated that the changes had been reviewed by an actuary, and stated that changes not accounted for in Skelly's letter would have "minimal impact" on the retirement system. The Commission voted three to two to recommend adoption of Ordinance 00-15 by the County Board.
¶ 5 The County Board adopted the ordinance on November 2, 2000, and the amendments became effective January 1, 2001.
¶ 6 We review summary judgment decisions de novo, applying the same method as the circuit court. Green Spring Farms v. Kersten, 136 Wis.2d 304, 315-17, 401 N.W.2d 816 (1987). That method is well established and need not be repeated in full here. See, e.g., Lambrecht v. Estate of Kaczmarczyk, 2001 WI 25, ¶¶ 20-24, 241 Wis.2d 804, 623 N.W.2d 751. For purposes of this case, it is sufficient to say that the evidence "must be viewed in the light most favorable to" the non-moving party and, if the moving party fails to establish clearly that there is no genuine issue of material fact, the motion must be denied. Kraemer Bros. v. United States Fire Ins. Co., 89 Wis.2d 555, 567, 278 N.W.2d 857 (1979).
¶ 7 When a claimant asserts a violation of the takings clause of the Wisconsin Constitution, courts undertake a two-part analysis. We determine whether a property interest exists and, if so, determine whether the property has been taken. Wisconsin Prof'l Police Ass'n v. Lightbourn, 2001 WI 59, ¶¶ 132-33, 243 Wis.2d 512, 627 N.W.2d 807. Often, an analysis of whether a property interest exists is "intertwined with the question of whether any property interest has been taken." Bilda v. County of Milwaukee, 2006 WI App 57, ¶ 14, ___ Wis.2d ___, 713 N.W.2d 661, review denied ___ Wis.2d ___, 718 N.W.2d 724 (2006) (citing Lightbourn, ...
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