Harvey v. South Carolina Department of Corrections, 3098.

CourtCourt of Appeals of South Carolina
Citation338 S.C. 500,527 S.E.2d 765
Decision Date10 January 2000
Docket NumberNo. 3098.,3098.
PartiesJames L. HARVEY, George N. Martin, III, W.T. Cave, James D. Beam, John H. Carmichael, Jr., and Judy Anderson, Respondents/Appellants, v. SOUTH CAROLINA DEPARTMENT OF CORRECTIONS; Parker Evatt, in his official capacity as Commissioner of Corrections, and South Carolina State Budget and Control Board, Appellants/Respondents.

338 S.C. 500
527 S.E.2d 765

James L. HARVEY, George N. Martin, III, W.T. Cave, James D. Beam, John H. Carmichael, Jr., and Judy Anderson, Respondents/Appellants,
v.
SOUTH CAROLINA DEPARTMENT OF CORRECTIONS; Parker Evatt, in his official capacity as Commissioner of Corrections, and South Carolina State Budget and Control Board, Appellants/Respondents

No. 3098.

Court of Appeals of South Carolina.

Heard October 5, 1999.

Decided January 10, 2000.

Rehearing Denied May 13, 2000.


338 S.C. 503
Kenneth L. Childs and Allen D. Smith, both of Childs & Halligan; Scott T. Justice, of Haynsworth, Baldwin, Johnson & Greaves, all of Columbia; and Thomas M. Christina, of Haynsworth, Baldwin, Johnson & Greaves, of Greenville, for appellants/respondents

J. Lewis Cromer, of Cromer & Mabry; and Benjamin A. Dunn, II, of Zeeff & Mitchell, both of Columbia, for respondents/appellants.

CONNOR, Judge:

Several current and retired employees of the South Carolina Department of Corrections filed suit, claiming they were erroneously enrolled in the South Carolina Retirement System. The trial court agreed and ordered their retroactive enrollment in the Police Officers Retirement System, but denied their claim for attorney fees. We reverse the trial court's order concerning retroactive enrollment, but affirm the denial of attorney fees.

338 S.C. 504
FACTS/PROCEDURAL HISTORY

James L. Harvey, George N. Martin, W.T. Cave, James D. Beam, John H. Carmichael, and Judy Anderson (Employees) are current or recently-retired senior employees of the South Carolina Department of Corrections (SCDC). Prior to 1983, SCDC enrolled Employees in the South Carolina Retirement System (SCRS). Under SCDC policy, only uniformed security personnel were placed into the Police Officers Retirement System (PORS), an alternative system for qualified "police officers." Initially, Employees were satisfied with placement in SCRS because the benefits were better than those of the newly-established PORS. Over the years, however, PORS benefits became substantially superior. Employees began to question whether they should have been enrolled in PORS and whether they could switch systems. However, they were consistently told they could not change systems.

In 1983, SCDC promulgated a plan to convert all Department personnel from SCRS to PORS, based on a consideration of the amount of each employee's continuous state service and the amount of inmate contact. As a result, in September of that year, Employees were admitted prospectively into PORS.

Despite their prospective inclusion in PORS, Employees continued to seek PORS benefits for previous service years. They requested all their service time be transferred from SCRS to PORS, but were informed they could not change systems. SCDC officials repeatedly told them the inequitable benefit distribution factors between SCRS and PORS would eventually be eliminated. In the meantime, Employees learned that select SCDC personnel had been placed in PORS, either from their initial employment date, or as a result of switching from SCRS.

Prior to 1988, no statutory mechanism existed for transferring credited service from SCRS to PORS. In 1988, however, the General Assembly enacted an amendment to the PORS statutory scheme expressly permitting the transfer of credited service from SCRS on payment of "the full cost as determined by the actuary." Act No. 658, 1988 S.C. Acts 6092. Subsequently, the cost provision was amended in 1989, effectively lowering the conversion cost by only requiring the employee

338 S.C. 505
to pay a "conversion fee" of five percent for each year transferred. S.C.Code Ann. § 9-11-40(9) (Supp.1998); Act No. 123, 1989 S.C. Acts 323. Despite being able to transfer service credit under the statute, Employees maintained they should not have to pay the conversion fee because they should have been enrolled in PORS in the first instance

SCDC Commissioner Parker Evatt (Evatt) began discussions with SCRS in an effort to formulate a more affordable conversion plan for Employees. Unfortunately, his efforts were unsuccessful, and on July 23, 1993, he issued a memorandum to several SCDC employees, including five of the six plaintiffs herein, informing them that, despite "every possible effort" to resolve the situation satisfactorily, "no other solution can be found beyond that which is already provided [by statute]."

Therefore, in August of 1993, Employees filed suit against SCDC, Evatt, and the South Carolina State Budget and Control Board (the Board). They alleged they had been enrolled improperly in SCRS rather than PORS. The Board denied their claims and raised several affirmative defenses. It also counterclaimed against Employees and cross-claimed against Evatt and SCDC. Evatt and SCDC answered Employees' complaint and cross-claimed against the Board.

The case eventually was heard in a bench trial. The trial court found Employees met the statutory definition of "police officer," and therefore were "entitled to have their retirement records corrected and to be included in [PORS] for those years in which they sought membership and in which they were members of [SCRS], provided that they pay the difference (if any) in contribution for those years." The judge limited retroactive service credit in PORS to "the period of time that each made inquiry and was denied entry or told that they could not qualify." However, he denied Employees' request for attorney fees, finding the administrative decisions barring Employees' access to PORS were not arbitrary or capricious.

Thereafter, the trial court denied all post-trial motions. Evatt, SCDC, and the Board (Defendants) appealed. Employees cross-appealed concerning the beginning date for retroactive credit and attorney fees.

338 S.C. 506
LAW/ANALYSIS

Appeal of Defendants Parker Evatt, SCDC, and the Board

I. Standard of Review

We have construed Employees' complaint liberally and have concluded that the action is best characterized as one for declaratory judgment. See Rule 8(f), SCRCP ("All pleadings shall be so construed as to do substantial justice to all parties."); S.C.Code Ann. § 15-53-130 (1977) (The Uniform Declaratory Judgments Act "is to be liberally construed and administered."); 26 C.J.S. Declaratory Judgments § 106 (1956) ("[T]he court may treat a suit as one for a declaratory judgment, even though it is not in form an action for a...

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