Gulbrandson v. Carey

• Decision Date: 21 September 1995
• Docket Number: No. 94-526,94-526
• Citation: 272 Mont. 494,901 P.2d 573
• Parties: L.C. GULBRANDSON, Plaintiff, v. Carole CAREY, Fred J. Flanders, Carol Lambert, Troy McGee, Sr., Eleanor Pratt and Terry Tiechrow, Individually and in Their Official Capacities as members of the Montana Public Employees' Retirement Board, Defendants.
• Court: Montana Supreme Court

Page 573

901 P.2d 573

272 Mont. 494

L.C. GULBRANDSON, Plaintiff, v. Carole CAREY, Fred J. Flanders, Carol Lambert, Troy McGee,

Sr., Eleanor Pratt and Terry Tiechrow, Individually and in

Their Official Capacities as members of the Montana Public

Employees' Retirement Board, Defendants.

No. 94-526.

Supreme Court of Montana.

Submitted April 11, 1995.

Decided Aug. 24, 1995.

Rehearing Denied Sept. 21, 1995.

Thomas K. Hopgood; Luxan & Murfitt, Patrick F. Hooks (argued), Helena, for plaintiff.

Kelly A. Jenkins (argued), Special Assistant Attorney General, Montana Department of Administration, Helena, for defendants.

GRAY, Justice.

By order dated October 31, 1994, and pursuant to Rule 44, M.R.App.P., the United States District Court, District of Montana, certified the following question of law to this Court for consideration and decision:

Does the benefit increase provided for in Chapter 664, Laws of 1989, an amendment to § 19-5-502, MCA, which became effective on July 1, 1991, apply to members of the Montana Judges' Retirement System who retired after the date of enactment but prior to the effective date of the legislation?

We accepted jurisdiction of the certified question by order dated November 15, 1994, and stated that we would decide the certified question on the basis of the statement of facts contained in the federal court's Certification of Question of Law, as well as the Record described in the Certification. We hold that the referenced benefit increase does not apply to members of the Montana Judges' Retirement System who retired after the enactment, but before the effective date, of the legislation and, therefore, answer the certified question in the negative.

The facts contained in the Certification, and upon which our decision is based, are as follows:

L.C. Gulbrandson (Gulbrandson), an Arizona resident, was an active member of the Montana Public Employees' Retirement System (PERS) and, subsequent to its creation, Judges' Retirement System (JRS) from January 4, 1960 through August 31, 1989. For service as a district court judge and supreme court justice during this period, Gulbrandson was credited with 29 years and 8 months of service credit in JRS. Since September 1, 1989, Gulbrandson has been a retired member of JRS.

Carole Carey, Eleanor Pratt, Terry Tiechrow, Troy McGee, Sr., Fred Flanders, and Carol Lambert are Montana residents appointed by the governor to the Public Employees' Retirement Board (Board), pursuant to § 2-15-1009, MCA. The Board is charged under Montana law, Title 19, MCA, with the administration of JRS, among other state administered governmental retirement systems.

During Gulbrandson's period of active membership on the bench in PERS, from January 4, 1960, through June 30, 1967, he contributed 5.6% of his salary to PERS. On July 1, 1967, JRS was formed as a retirement system separate from PERS. All Gulbrandson's service credit in PERS was transferred to JRS. From July 1, 1967, through August 31, 1989, Gulbrandson contributed 6% of his salary to JRS.

During the 51st Montana Legislature which convened in January 1989, Senate Bill 241 was introduced by Senator Mazurek and others. This bill, as introduced, provided for additional state funding to JRS and provided for an increase in retirement benefits for those years served by a Judge after the 15th year from 1% to 2% of final salary for each such year of service.

This bill, as amended, was signed by the Governor of Montana on May 13, 1989, and enrolled as Chapter 664, Laws of 1989 (Ch. 664). As enacted, Ch. 664 was effective on July 1, 1989, except for two sections which were to be effective on July 1, 1991. The more pertinent of these delayed-effect sections, Sec. 3, provided as follows:

Section 19-5-502, MCA, is amended to read:

Upon retirement from service, a member shall receive a service retirement allowance which shall consist of the state annuity plus the member's annuity. The member's annuity shall be the actuarial equivalent of his aggregate contributions at the time of retirement . The state annuity shall be in an amount which, when added to the member's annuity, will provide a total retirement allowance of 3 1/3% per year of his final salary for the first 15 years' service and 1.785% per year for each year's service after 15 years' service.

Sec. 3, Ch. 664 was one of two sections of that legislation which had a delayed July 1, 1991, effective date. The remainder of the legislation, including a mechanism for increased state funding for JRS, was effective July 1, 1989.

Gulbrandson was an active member of JRS at the time of the legislative enactment and for more than three months beyond enactment. As an active member during this time, Gulbrandson continued to contribute 6% of his salary to JRS.

Had he completed his term, Gulbrandson's term of office would have expired January 6, 1991. Gulbrandson resigned voluntarily on August 31, 1989.

Beginning September 1, 1989, Gulbrandson began to receive "a total retirement allowance of 3 1/3% per year of his final salary for the first 15 years' service and 1% per year for each year's service thereafter," as provided in § 19-5-502, MCA, on that date. Gulbrandson has continued to receive a total retirement allowance based on these percentages.

Between May 13, 1989, and July 1, 1991, there were 6 active members of JRS with more than 15 years of service. Gulbrandson was the only member with more than 15 years of service who voluntarily terminated service during that period.

On January 23, 1992, Gulbrandson appeared before the Board informally seeking Board consideration of the application of Sec. 3, Ch. 664, initially as to all members retired prior to July 1, 1991, then as to himself. The Board requested an Attorney General's Opinion on the issues.

On December 4, 1992, the Attorney General of Montana issued an opinion to the Board which concluded that Ch. 664 did not increase the retirement allowance for those JRS members who retired prior to July 1, 1991, even those who retired after the date of enactment.

On September 13, 1993, Gulbrandson filed a formal petition with the Board for redetermination of his retirement allowance. The Board denied the petition on September 23, 1993.

Members of JRS with more than 15 years of service credit who retired after July 1, 1991, have received "a total retirement allowance of 3 1/3% per year of his final salary for the first 15 years' service and 1.785% per year for each year's service after 15 years' service," as provided in § 19-5-502, MCA, after that date.

Jack L. Green, a JRS member active from May 1, 1963, through December 31, 1992, with 29 years, 8 months service credit in JRS, has at all times received a total retirement allowance based on 1.785% of final average salary for all years subsequent to his 15th year of service.

1. Is Gulbrandson entitled to the increased retirement benefit provided in Section 3, Chapter 664, Laws of 1989, amending § 19-5-502, MCA, which was enacted in 1989 and effective July 1, 1991, under the plain language of the statute?

Our function in construing and applying statutes is to effectuate the legislature's intent. United States v. Brooks (Mont.1995), --- Mont. ----, ----, 890 P.2d 759, 761, 52 St.Rep. 113, 114. To determine legislative intent, we first look to the plain meaning of the words used in the statute. Stansbury v. Lin (1993), 257 Mont. 245, 249, 848 P.2d 509, 511. If the legislature's intent can be determined by the plain language of the words used, we may not go further and apply other means of interpretation. Prairie County Co-op State Grazing District v. Kalfell Ranch, Inc. (1994), 269 Mont. 117, 124-125, 887 P.2d 241, 246. It is only when the intent cannot be determined from the language of the statute that we will examine legislative history. Matter of Kalfell Ranch, Inc., 887 P.2d at 246.

As of its effective date on July 1, 1991, Section 3, Chapter 664 provides an increased retirement benefit to JRS members with more than 15 years' service "upon retirement from service." The plain meaning of the statutory language is that a member is entitled to the increased benefit upon his or her retirement from service on or after July 1, 1991. Such plain, clear and unambiguous language expresses the legislature's intent and permits no further interpretation by this Court. Matter of Kalfell Ranch, Inc., 887 P.2d at 246.

Here, Gulbrandson retired from service nearly two years before the effective date of Section 3, Chapter 664. He did not retire again on or after July 1, 1991. Based on the plain meaning of the statute, we conclude that he was not entitled to the increased retirement benefit contained in § 19-5-502, MCA, as amended by Chapter 664, upon his retirement prior to July 1, 1991.

Gulbrandson argues that denial of his entitlement to the increased retirement benefit impermissibly impairs his contract with the JRS in violation of Article II, section 31, of Montana's Constitution. Under the three-part test we apply to determine whether legislation violates the impairment of contracts clause, the initial inquiry is whether the law has operated as a substantial impairment of the contract. Matter of Yellowstone River (1992), 253 Mont. 167, 182-83, 832 P.2d 1210, 1219 (citations omitted). Thus, in order to address Gulbrandson's argument, we must determine the parameters of his contract to determine whether the contract guarantees him the benefit increase contained in Section 3, Chapter 664. If it does not, then denial of the increased retirement benefit cannot impair the contract.

At the time of Gulbrandson's retirement prior to the effective date of Section 3, Chapter 664, JRS members with more than 15 years' service were entitled to 1% per year of current salary for each year of service after 15 years. See § 19-5-502, MCA (1989). This clear and undisputed entitlement is our starting point in determining the terms of Gulbrandson's retirement benefit contract.

Gulbrandson...