Harvey v. State

• Decision Date: 16 July 2003
• Docket Number: Docket No. 121672, Calendar No. 8.
• Citation: 469 Mich. 1,664 N.W.2d 767
• Parties: Annabelle R. HARVEY, beneficiary and successor of Paul Harvey, deceased, and Michael F. Merritt, Judge, retired, substituted for Bruce A. Fox, Judge, retired, Plaintiffs-Appellees, v. STATE of Michigan, DEPARTMENT OF MANAGEMENT AND BUDGET, BUREAU OF RETIREMENT SERVICES, and Judges Retirement Board, Defendants-Appellants.
• Court: Michigan Supreme Court

664 N.W.2d 767

469 Mich. 1

Annabelle R. HARVEY, beneficiary and successor of Paul Harvey, deceased, and Michael F. Merritt, Judge, retired, substituted for Bruce A. Fox, Judge, retired, Plaintiffs-Appellees, v. STATE of Michigan, DEPARTMENT OF MANAGEMENT AND BUDGET, BUREAU OF RETIREMENT SERVICES, and Judges Retirement Board, Defendants-Appellants.

Docket No. 121672, Calendar No. 8.

Supreme Court of Michigan.

Argued April 9, 2003.

Decided July 16, 2003.

Michael F. Merritt, Brighton, MI, and Kasiborski, Ronayne & Flaska, P.C., (by Chester E. Kasiborski, Jr. and Kenneth A. Flaska), Detroit, MI, for the plaintiffs-appellees.

Michael A. Cox, Attorney General, Thomas L. Casey, Solicitor General, and Stephen M. Rideout, Assistant Attorney General, Lansing, MI, for the defendants-appellants.

MARILYN J. KELLY, J.

We took this case to consider the constitutionality of the district court judicial pension provisions of the Judges Retirement Act, M.C.L. § 38.2101 et seq., as amended in the court reorganization act of 1980, 1980 PA 438 through 443.¹ The Court of Appeals reviewed plaintiffs' equal protection challenge and concluded that the statute was unconstitutional, utilizing the intermediate scrutiny test. We hold that the statute is constitutional and the proper standard is the rational-basis test. Accordingly, we reverse the decision of the Court of Appeals and enter a judgment in favor of defendants.

I. FACTUAL & PROCEDURAL BACKGROUND

Plaintiffs are retired state district court judges who served throughout the state in districts other than the 36th Judicial District in Detroit. They have asserted that the Judges Retirement Act violates the Equal Protection Clause of the Michigan Constitution² by allowing the state to provide a greater retirement allowance to 36th District Court judges than to all others. The act provides 36th District Court judges a pension based on their former total salary, whereas it provides the others a pension based on only a portion of their former total salary.

Before 1980, in all Michigan's trial level judicial districts, judicial salaries were paid partly by the state and partly by a local funding unit, usually a city or county. In accordance with this dual salary system, all state trial level judges belonged to two retirement systems: one maintained by the state and one by the local funding unit.

In 1980, the Legislature created a new funding scheme for state judicial retirees as part of the court reorganization act, 1980 PA 438 through 1980 PA 443. Through this act, the Legislature sought to require the state to begin to fully assume the cost of state court operations, starting with the 36th Judicial District. Concomitant with this funding, the Legislature amended the Judges Retirement Act to establish the state as the provider of both the state and local components of 36th Judicial District Court judges' salaries. Accordingly, the state pays both the state and local components of 36th Judicial District Court judges' retirement benefits.

In succeeding years, the goal of full state funding of court operations was not fulfilled. Nevertheless, the state continues to fund one hundred percent of 36th Judicial District judges' pensions. The retirement systems and pensions of judges outside the 36th Judicial District continue to be funded by both state and local sources. Depending on the funding and contribution levels in their local government retirement schemes, these judges may receive a greater or lesser retirement benefits than do the judges of the 36th Judicial District.

Plaintiffs commenced the present suit in 1994. The circuit court granted defendants' motion for summary disposition, concluding that the Judges Retirement Act does not violate the Equal Protection Clause when subjected to review under the rational-basis test. The Court of Appeals reversed the decision and remanded, holding that the court should have employed an intermediate scrutiny test in deciding this case. Unpublished opinion per curiam, issued January 3, 1997 (Docket No. 187112), 1997 WL 33354621 (Harvey I).

On remand, the circuit court again found for defendants, holding that the act satisfies intermediate scrutiny. The Court of Appeals again reversed the lower court, applying the intermediate scrutiny test itself and holding the Act unconstitutional. It also remanded the case for further proceedings concerning the appropriate remedy. 251 Mich.App. 323, 650 N.W.2d 392 (2002) (Harvey II).

Upon defendants' application, this Court granted leave to appeal. In our grant order, we directed the parties to include among the issues to be briefed:

(1) [T]he applicable level of scrutiny under Fourteenth Amendment analysis, (2) the current viability, if any, of Manistee Bank v. McGowan, 394 Mich. 655 (1975), and (3) this Court's ability to order the relief requested, inter alia, fully state-funded pensions for outstate judges, prospectively and retroactively, in light of Const. 1963, art. 1, § 2; art. 3, § 2; art. 4, § 1; Lewis v. Mich., 464 Mich. 781, 786-787 (2001); see also North Ottawa Hosp. v. Kieft, 457 Mich. 394, 408 n. 141 (1998); 77th Dist. Judge v. Michigan, 175 Mich.App. 681 (1989). [467 Mich. 899, 653 N.W.2d 181 (2002).]

II. PRINCIPLES OF REVIEW

We review summary disposition judgments and constitutional issues de novo. Taylor v. Gate Pharmaceuticals, 468 Mich. 1, 5, 658 N.W.2d 127 (2003). The Equal Protection Clause of the Michigan Constitution declares that "[n]o person shall be denied the equal protection of the laws...." Const. 1963, art. 1, § 2. We have interpreted this clause to be coextensive with its federal counterpart.³Crego v. Coleman, 463 Mich. 248, 258, 615 N.W.2d 218 (2000); Vargo v. Sauer, 457 Mich. 49, 60, 576 N.W.2d 656 (1998); Doe v. Dep't of Social Services, 439 Mich. 650, 662, 487 N.W.2d 166 (1992).

III. ANALYSIS

Not all legislative enactments that group people into classifications affront the Equal Protection Clause. Indeed, many legitimately group people on the basis of such considerations as (1) their income for purposes of the tax laws, (2) their income for purposes of eligibility for social services, or (3) their conduct for purposes of imposing criminal sanctions. A court evaluates equal protection challenges to the constitutional validity of a classification using one of three levels of scrutiny, depending on the nature of the classification. Plyler v. Doe, 457 U.S. 202, 216-217, 102 S.Ct. 2382, 72 L.Ed.2d 786 (1982).

In Crego, we articulated the three levels of scrutiny:

The highest level of review, or "strict scrutiny," is invoked where the law results in classifications based on "suspect" factors such as race, national origin, or ethnicity, none of which are [sic] implicated in this case. Plyler v. Doe, 457 U.S. 202, 216-217, 102 S.Ct. 2382, 72 L.Ed.2d 786 (1982). Absent the implication of these highly suspect categories, an equal protection challenge requires either rational-basis review or an intermediate, "heightened scrutiny" review.

A. Where rational basis applies

Under rational-basis review, courts will uphold legislation as long as that legislation is rationally related to a legitimate government purpose. Dandridge v. Williams, 397 U.S. 471, 485, 90 S.Ct. 1153, 25 L.Ed.2d 491 (1970). To prevail under this highly deferential standard of review, a challenger must show that the legislation is "arbitrary and wholly unrelated in a rational way to the objective of the statute." Smith v. Employment Security Comm., 410 Mich. 231, 271, 301 N.W.2d 285 (1981). A classification reviewed on this basis passes constitutional muster if the legislative judgment is supported by any set of facts, either known or which could reasonably be assumed, even if such facts may be debatable. Shavers v. Attorney General, 402 Mich. 554, 613-614, 267 N.W.2d 72 (1978). Rational-basis review does not test the wisdom, need, or appropriateness of the legislation, or whether the classification is made with "mathematical nicety," or even whether it results in some inequity when put into practice. O'Donnell v. State Farm Mut. Automobile Ins. Co., 404 Mich. 524, 542, 273 N.W.2d 829 (1979). Rather, the statute is presumed constitutional, and the party challenging it bears a heavy burden of rebutting that presumption. Shavers, supra.

B. Where heightened scrutiny applies

The United States Supreme Court has recognized an intermediate level of review, between strict-scrutiny and rational-basis review, under which a challenged statutory classification will be upheld only if it is "substantially related to an important governmental objective." Clark v. Jeter, 486 U.S. 456, 461, 108 S.Ct. 1910, 100 L.Ed.2d 465 (1988). This "heightened scrutiny" standard has been applied to legislation creating classifications on such bases as illegitimacy and gender. The standard recognizes that, while there may be certain immutable distinctions, for example, between men and women or between legitimate and illegitimate children, that justify differing legislative treatments under some circumstances, the Legislature's authority to invoke those distinctions should not be viewed as an "impenetrable barrier that works to shield otherwise invidious discrimination." Gomez v. Perez, 409 U.S. 535, 538, 93 S.Ct. 872, 35 L.Ed.2d 56 (1973). See also, e.g., Clark, supra; Mills v. Habluetzel, 456 U.S. 91, 102 S.Ct. 1549, 71 L.Ed.2d 770 (1982); Mathews v. Lucas, 427 U.S. 495, 505-506, 96 S.Ct. 2755, 49 L.Ed.2d 651 (1976) (all applying heightened scrutiny to classifications based on illegitimacy). Thus, where an equal protection claim alleges unconstitutional treatment on the basis of illegitimacy, the Supreme Court has held that "a State may not invidiously discriminate against illegitimate children by denying them substantial benefits accorded children generally." Gomez, supra at 538. However, where a challenged statute is substantially related to an important state interest, the statute should be upheld. Mills, supra at 98-99....