City of Marietta v. Holland, s. 40143

Decision Date15 March 1984
Docket NumberNos. 40143,40534,s. 40143
Citation314 S.E.2d 97,252 Ga. 299
PartiesCITY OF MARIETTA, et al. v. Thomas W. HOLLAND, Sr.
CourtGeorgia Supreme Court

Joseph C. Parker, Downey, Cleveland, Moore & Parker, Marietta, for City of Marietta et al.

Alston & Bird, Peter M. Degnan, G. Conley Ingram, Atlanta, for Thomas W. Holland, Sr.

Walter E. Summer, amicus curiae.

BELL, Justice.

This is a dispute over retirement disability benefits. Appellee served as a part-time councilman for appellant City of Marietta (the City) from 1961 to May, 1980. Appellee has a heart condition, and in June, 1970 the Social Security Administration (SSA) determined he was eligible for disability benefits, and began payments thereof. In November, 1973 the City joined the Joint Municipal Employees Retirement System (JMERS), Ga.L.1965, p. 421 (now OCGA Title 47, Ch. 5) (Code Ann. § 69-1701 et seq.)). The original pension plan agreement between the City and JMERS did not include members of the City council (the council). In June, 1975 appellant Marietta City Council adopted, without prior published public notice, an ordinance extending the pension plan's coverage to elected City officials. The City terminated its participation in the plan in January, 1981.

Under the pension plan, participants were deemed eligible to receive retirement disability benefits if they were entitled to SSA disability benefits. During the period 1975-80, the City listed appellee as a participant in the plan, and paid money into the pension fund on his behalf. Appellee resigned from the council in 1980 on account of his heart condition, and applied to the City's pension committee for disability benefits. This application was denied, as was his appeal to the council. Appellee subsequently reapplied for benefits, which were again denied. After exhausting his administrative remedies he filed suit in superior court in July of 1981, naming the City, the council, and the pension committee as defendants. In his suit he prayed for mandamus to issue to require acceptance of his application, damages for breach of contract in the amount of benefit payments which he would have received had his application been accepted, and attorney fees.

Cross-motions for summary judgment were filed, and were denied. Application for interlocutory appeal was then made to this court, which we denied. Thereafter, the City contacted SSA, alleging that appellee was ineligible for disability benefits because his income as a member of the council had exceeded certain income limits used by SSA in its determination of disability eligibility. However, after conducting its own investigation of the allegations, SSA determined in December of 1982 that appellee was still entitled to benefits. The parties renewed their cross-motions for summary judgment, and the trial court granted appellee's and denied appellants', awarding appellee damages for past JMERS disability payments, and issuing a mandamus to accept appellee's application. In addition, the court awarded attorney fees, OCGA § 13-6-11 (Code Ann. § 20-1404), reserving the issue of the amount of the award. Defendants appealed in 40143, and we affirm in part and reverse in part. The trial court subsequently entered an order awarding $5000 in attorney fees to appellee. Defendants appealed this order in 40534, and we reverse.

1). The threshold issue is the validity of the June, 1975 ordinance. Appellants contend that the council was required by statute to advertise notice of its intent to consider the ordinance extending participation in the JMERS pension to its own members, and that the omission to do so was fatal to the ordinance, thereby invalidating appellee's purported participation in the City's JMERS. We disagree.

Appellants' argument is based upon the language of former Ga.Code Ann. § 69-1019 (now OCGA § 36-35-4), which was part of the Municipal Home Rule Act of 1965, as amended, as it existed when the disputed ordinance was passed in 1975. Ga.L.1974, p. 195. The relevant language was, "[t]he governing authority of each incorporated municipality is authorized to fix the salary, compensation, and expenses of the municipal employees and members of the governing authority and/or legislative body, and to provide insurance, retirement and pension benefits, coverage under Federal Old Age and Survivor's Insurance programs, hospitalization benefits, and workmen's compensation benefits, for its employees, their dependents and survivors, provided that no action to increase compensation of the elective members of the governing authority or legislative body shall be taken until notice of intent to do so shall be published in a newspaper of general circulation in such municipality at least once a week for three consecutive weeks immediately preceding the week in which such action is taken." (emphasis supplied).

Appellants contend that, because retirement plan benefits are a species of deferred compensation, Ga.Code Ann. § 60-1019 required that the council should have advertised its intention to extend retirement plan benefits to itself. However, we think this argument fails for two reasons. First, and most obviously, although we agree that, as a general proposition, retirement plan benefits are deferred compensation, see DeWitt v. Richmond County, 192 Ga. 770, 16 S.E.2d 579 (1941), the General Assembly drew a clear distinction in Ga.L.1974, p. 195 between "compensation," on the one hand, and "retirement and pension benefits," on the other. Since the distinction between these terms is plain in the first part of the above-quoted statutory language, we see no reason to infer that the General Assembly intended to use the term "compensation" in a more generic sense in the second part. Therefore, we will not construe Ga.L.1974, p. 195 as imposing the condition of prior advertisement upon the June, 1975 ordinance of the council.

Our second reason for declining to interpret the Home Rule Act in the restrictive fashion urged by appellants is based upon a comparison of the evolution of that Act and JMERS. As originally enacted, the Home Rule Act provided that "the governing body of any incorporated municipality shall have the following powers, under this Act, relating to the administration of municipal government: (a) The power to ... define, regulate and alter the ... compensation ... of all municipal officers, agents and employees: Provided, that the municipal governing body shall not have the right ... to alter their own compensation or the compensation of their successors...." Ga.L.1962, pp. 140, 141-142. In the form it took in the 1965 reenactment of the statute, this provision read, "(a) The power granted to municipalities ... shall not be construed to extend to ... 1. Action affecting the ... compensation, and expenses and allowances in the nature of compensation ... for the elective members of the municipal governing authority." Ga.L.1965, pp. 298, 302-303. In 1973 the General Assembly amended the Home Rule Act to essentially the same form it had when the June, 1975 Marietta ordinance was passed, Ga.L.1973, pp. 778, 780-781, with the exception that the phrase, "of the members of the governing authority or legislative body" was inserted between the words "compensation" and "shall" by the amendment of 1974, Ga.L.1974, pp. 195-196.

JMERS was created by Ga.L.1965, p. 421. In the part relevant to our analysis, it declared the intent of the General Assembly to be "to provide a method whereby the municipal corporations of this State may, in the discretion of their respective governing bodies, provide retirement and other benefits to their employees through a common administrative and investment system.... This is considered to be in the public interest ... [, and it] is therefore intended that this Act be liberally construed to effectuate this intent. Section 2. The following words and phrases as used in this Act shall ... have the following meanings: ... (5) "Employee" shall mean any full-time salaried, or hourly-rated person, including appointed and elected officers, in the active service of a municipal corporation of the State of Georgia." Id. at 422-423 (emphasis supplied). In 1973 the foregoing definition of "employee" was reformulated to "mean any full-time salaried or hourly-rated person in the active service of a municipal corporation of the State of Georgia, ... and, notwithstanding any laws to the contrary, any appointed or elected member of the governing authority of a municipal corporation of the State of Georgia." Ga.L.1972, pp. 637, 638 (emphasis supplied).

Thus, the law as it existed in 1975 had undergone a steady development toward granting members of municipal governing bodies greater discretion in setting their own compensation and retirement benefits. The 197...

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    ...material fact as to whether any of the criteria of O.C.G.A. § 13–6–11 ... are applicable to [the defendant].” City of Marietta v. Holland , 252 Ga. 299, 314 S.E.2d 97, 101 (1984). (finding that the lower court erred in failing to grant summary judgment in favor of the defendants, because th......
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