Devoney v. Retirement Board

• Decision Date: 18 April 2002
• Docket Number: No. 91468.,91468.
• Parties: William DEVONEY, Appellant, v. THE RETIREMENT BOARD OF THE POLICEMEN'S ANNUITY & BENEFIT FUND FOR THE CITY OF CHICAGO, Appellee.
• Court: Illinois Supreme Court

769 N.E.2d 932

199 Ill.2d 414

264 Ill.Dec. 95

William DEVONEY, Appellant, v. THE RETIREMENT BOARD OF THE POLICEMEN'S ANNUITY & BENEFIT FUND FOR THE CITY OF CHICAGO, Appellee.

No. 91468.

Supreme Court of Illinois.

April 18, 2002.

Rehearing Denied May 29, 2002.

Thomas J. Pleines, Chicago, for appellant.

David R. Kugler, Chicago for appellee.

Chief Justice HARRISON delivered the opinion of the court:

William Devoney, a former Chicago police lieutenant, was convicted of federal mail fraud charges arising from his participation in a scheme to defraud Allstate Insurance. The issue before us is whether Devoney's conviction, a felony, "relat[ed] to or [arose] out of or in connection with his service as a policeman" so as to render him ineligible for his police pension benefits under section 5-227 of the Illinois Pension Code (40 ILCS 5/5-227 (West 1998)). The Retirement Board of the Policemen's Annuity and Benefit Fund of the City of Chicago (the Retirement Board) answered this question in the affirmative and denied Devoney his pension. On administrative review, the circuit court of Cook County affirmed the Retirement Board's decision. The appellate court subsequently affirmed the circuit court's judgment, with one justice dissenting. 321 Ill.App.3d 1, 254 Ill. Dec. 79, 746 N.E.2d 836. We granted Devoney leave to appeal. 177 Ill.2d R. 315. For the reasons that follow, we now affirm.

Devoney served on the Chicago police force for more than 34 years, eventually attaining the rank of lieutenant. In October of 1994, a federal grand jury indicted him along with 23 other persons on charges of conspiracy to commit insurance fraud. Devoney resigned from the police department the following month. He then entered into a written plea agreement with the United States Attorney's office under which he pleaded guilty to one count of mail fraud, a felony, in violation of 18 U.S.C. § 1341 (1994). The federal court accepted Devoney's plea and ultimately sentenced him to 16 months' incarceration and 3 years of supervised release and ordered him to pay restitution in the amount of $42,000 plus a $50 special assessment.

The circumstances which gave rise to Devoney's conviction originated from his friendship with David Ballog, Jr., one of his codefendants in the federal prosecution. Ballog is a career criminal who made his living by filing fraudulent insurance claims. Devoney first met Ballog in the early 1980s when Ballog hired him to install a concrete patio. Ballog was aware that Devoney was a police officer. He cultivated his friendship with Devoney because he believed such a friendship would aid him in dealing with the legal problems he frequently faced.

In 1992, Devoney's wife slipped and fell at home and broke her ankle. Following the injury, Ballog and Devoney conspired with Matt Raimondi, one of Ballog's associates, to defraud Raimondi's homeowner's insurance carrier by claiming that Devoney's wife had actually injured herself at Raimondi's home as a result of Raimondi's negligence. The scheme ultimately netted a $70,000 cash settlement from Raimondi's insurer, which Devoney split with Raimondi and Ballog. Negotiations leading to the settlement were conducted by Ballog, who represented himself to the insurer as the brother of Devoney's wife. They also involved the assistance of Devoney, who personally spoke with adjusters regarding the claim.

At the time Devoney resigned from the force, he was entitled to receive a pension. After he pleaded guilty, the Retirement Board began to withhold his pension benefits. Devoney subsequently applied to have the benefits restored. The Retirement Board conducted a series of administrative hearings on his application, the last of which took place in June of 1998. The following month, the Retirement Board issued a final decision denying reinstatement of Devoney's benefits pursuant to section 5-227 of the Pension Code (40 ILCS 5/5-227 (West 1998)), which provides:

"None of the benefits provided for in this Article shall be paid to any person who is convicted of any felony relating to or arising out of or in connection with his service as a policeman."

Devoney sought administrative review of the Retirement Board's decision in the circuit court. He was not successful. The circuit court affirmed the Board's denial of Devoney's application for restoration of pension benefits. The appellate court affirmed the circuit court's judgment, and we granted Devoney leave to appeal from the judgment of the appellate court.

Here, as throughout this litigation, the dispositive question is whether reinstatement of Devoney's pension benefits was properly denied under section 5-227 of the Pension Code based on his felony conviction. Any felony conviction will disqualify a police officer from receiving benefits under the Pension Code when the conviction takes placed while the officer is receiving disability benefits. Devoney, however, was not on disability at the time of his conviction. Accordingly, an additional requirement applied. Under the Pension Code, he could only be disqualified from receiving benefits if the felony was one "relating to or arising out of or in connection with" his service as a policeman. 40 ILCS 5/5-227 (West 1998).

The requirement that the conviction relate to or arise out of or in connection with a person's service as a policeman is not unique to law enforcement. Identical provisions govern members of the General Assembly (40 ILCS 5/2-156 (West 1998)), participants in the Illinois Municipal Retirement Fund (40 ILCS 5/7-219 (West 1998)), those in the Municipal Employees', Officers', and Officials' Annuity and Benefit Fund (40 ILCS 5/8-251 (West 1998)), county employees (40 ILCS 5/9-235 (West 1998)), employees under the Laborers' and Retirement Board Employees' Annuity and Benefit Fund (40 ILCS 5/11-230 (West 1998)), sanitary district employees (40 ILCS 5/13-807 (West 1998)), state employees (40 ILCS 5/14-149 (West 1998)), judges (40 ILCS 5/18-163 (West 1998)), and others (see, e.g., 40 ILCS 5/16-199 (West 1998)).

These provisions have been enacted pursuant to the legislature's power "to deter felonious conduct in public employment by affecting the pension rights of public employees convicted of a work-related felony." See Stillo v. State Retirement Systems, 305 Ill.App.3d 1003, 1007, 239 Ill. Dec. 453, 714 N.E.2d 11 (1999). Their purpose is to "discourage official malfeasance by denying the public servant convicted of unfaithfulness to his trust the retirement benefits to which he otherwise would have been entitled." Kerner v. State Employees' Retirement System, 72 Ill.2d 507, 513, 21 Ill.Dec. 879, 382 N.E.2d 243 (1978).

The statutes are general in describing how the felony conviction must pertain to an employee's public service before the pension benefit disqualification will be triggered, but they could not be otherwise. The ways in which governmental offices can be exploited for illicit purposes are so diverse and varied that greater specificity would be impossible.

When applying the pension disqualification statutes, including section 5-227, the pivotal inquiry is whether a nexus exists between the employee's criminal wrongdoing and the performance of his official duties. See DiFiore v. Retirement Board of the Policemen's Annuity & Benefit Fund, 313 Ill.App.3d 546, 551, 246 Ill. Dec. 227, 729 N.E.2d 878 (2000). The appellate court opined that the nexus requirement was satisfied in this case because Devoney's participation in the unlawful activity violated his sworn duty to report crime and arrest persons engaged in criminal conduct. 321 Ill.App.3d at 10, 254 Ill.Dec. 79, 746 N.E.2d 836. The dissenting appellate court justice argued, however, that this rationale cannot be squared with the provisions of the Pension Code. We believe that the dissenting justice's concerns are well founded.

Although a duty to report crime and arrest criminals does arise from an officer's service as a policeman, breach of that duty is not what triggers disqualification for a pension. Under the plain and unambiguous language of the statute, what triggers disqualification is the existence of a connection between the actual felony conviction and the officer's service as a policeman.

The distinction is important because the two sets of events, breach of the duty to report and arrest and conviction of a felony, are not equivalent. Whether an officer may be deemed to have breached his duty to arrest and report is not dependent on his having committed a felony associated with his service as a policeman. The duty may be breached where the underlying offense was not a felony, the officer was not personally involved in its commission, or the offense had nothing whatever to do with the fact that he was a policeman.

Correspondingly, an officer's commission of a felony will not automatically constitute a breach of his duty to report and arrest. If an officer who has committed a felony immediately surrenders to authorities and confesses to the crime, for example, no breach of the duty to arrest and report can be said to have occurred.

Admittedly, felonious police officers are not apt to voluntarily surrender and confess their crimes. As a practical matter, their criminal activity will be accompanied by a breach of their duty to arrest and report. The fact that a breach of the duty to arrest and report will normally follow an officer's commission of a felony does not mean, however, that the felony itself "related] to or [arose] out of or in connection with his service as a policeman" within the meaning of section 5-227 of the Pension Code. Whether a nexus exists between the officer's service as a policeman and the crime he is convicted of committing is a separate inquiry.

If the requisite statutory nexus could be established based solely on the felonious officer's breach of his duty to arrest and report, as the appellate court majority suggests, every felony committed by a police officer would...