Railroad Retirement Board v. Bates, 7812.

• Decision Date: 24 February 1942
• Docket Number: No. 7812.,7812.
• Citation: 126 F.2d 642
• Parties: RAILROAD RETIREMENT BOARD v. BATES.
• Court: U.S. Court of Appeals — District of Columbia Circuit

126 F.2d 642 (1942)

RAILROAD RETIREMENT BOARD v. BATES.

No. 7812.

United States Court of Appeals for the District of Columbia.

Decided February 24, 1942.

Mr. Lester P. Schoene, General Counsel, Railroad Retirement Board, of Washington, D. C., for appellant.

Mr. J. M. Souby, with whom Mr. Gregory S. Prince was on the brief, both of Washington, D. C., for appellee.

Before GRONER, Chief Justice, and MILLER and VINSON, Associate Justices.

VINSON, Associate Justice.

Is a person who is receiving a pension under subsection 6(a) of the Railroad Retirement Act of 1937¹ precluded by that fact alone from becoming eligible for an annuity under section 2? After the Railroad Retirement Board had decided in the affirmative, Miss Bates filed a complaint in the District Court under the authority of section 11, and prayed that the Court set aside the Board's decision on the limited point and proceed to adjudicate the other questions of her eligibility for an annuity. The Board moved to dismiss for failure to state a claim upon which relief could be granted. This motion was denied, and when the Board failed to plead further, the Court ordered that plaintiff's eligibility for an annuity be determined irrespective of the fact that she is receiving a pension, and if found eligible, grant the annuity as of August 1, 1938, in lieu of the pension. The Board appeals.

For the 26 years preceding January 1, 1934, Miss Bates was employed jointly by the Southern Pacific Company and the Union Pacific Railroad Company in an office maintained here. On that date Southern Pacific withdrew from the arrangement, and plaintiff remained an employee of Union Pacific until it closed its office July 31, 1938.

Southern Pacific granted Miss Bates a pension of $21.59 per month effective January 1, 1934. The government assumed the pension as of July 1, 1937.

In July, 1938, Miss Bates filed an application for an annuity under section 2, stating that she was 71 years of age and intended to cease compensated service on the 31st. She computed the annuity to which she was entitled at $70.34 per month.

The present Act of 1937 was an amendment of the 1935 Act by substitution. Roughly the 1937 Act divides those receiving payments after their railroad service has ended into annuitants and pensioners. The first are those who receive retirement benefits from the permanent government plan under section 2. The second are those who received pensions from their employers which the government assumed under subsection 6(a). We are now concerned with the mutual exclusiveness of the two classifications and the more precise question, can a person change from one group to the other. For the purposes of clarity we mention a third group: those who were pensioners but were also eligible for annuities on July 1, 1937. That group receive special statutory consideration in subsection 6(a) and are made annuitants.

Although the Board argues that the question here is whether its interpretation of the Act is plainly erroneous, the issue we shall decide, as has been stated, is whether a person otherwise eligible for an annuity under section 2 is disqualified because he receives a pension under subsection 6(a). Inasmuch as the Board is familiar with problems in its field and has had experience and understands the Act which creates it, it is proper that weight should be given to its interpretations. Nonetheless the question is a question of law, one of statutory interpretation,² and that is a field in which courts are regarded as having some expertness just as administrative tribunals have special knowledge of the recurring factual patterns in their several spheres of activity. This is, apparently, the first decision the Board has made on the instant problem in accordance with its interpretation of the Act, and our attention has been called to only one similar situation. There is no long administrative interpretation of the Act as a whole nor of the sections with which we shall deal in particular. There has been no congressional re-enactment after an administrative interpretation. This factual situation is one on which the Act carries no positive directive terms; it is at least an interstitial situation. Thus, while according weight to the Board's conclusion and reasoning, in view of the nature of the question and the terms of the Act, we are free to affirm the District Court, although the Board's interpretation of the Act may not be plainly erroneous.³

Eligibility for an annuity, which plaintiff seeks, is set out in section 2, which begins:

"The following-described individuals, if they shall have been employees on or after August 29, 1935, shall, subject to the conditions set forth in subsections (b), (c), and (d), be eligible for annuities after they shall have ceased to render compensated service to any person * * *."

The main rules for computation are presented in section 3. For the purposes of this litigation, Miss Bates now and as of the time of this controversy, unquestionably meets the express requirements of section 2. There is nothing in any part of section 2 which says directly or indirectly that a pensioner is ineligible for its benefits.

We turn to subsection 6(a), which provides for the assumption of pensions, a new feature of the 1937 Act.

| "Beginning July 1, 1937, each individual | then on the pension or gratuity | roll of an employer by reason of his | employment, who was on such roll on | March 1, 1937, shall be paid on July 1 | 1937, and on the 1st day of each calendar m

There is no reference directly or indirectly to the annuity section.

There was a substantial group of persons at about the time the 1937 Act was to become law whose pensions would be assumed under subsection 6(a), and who would also be eligible for annuities under section 2. And so Congress enacted subsection 6(b).

| "No individual covered by this section | 6(a) who was on | |July 1, 1937, eligible for an annuity | |under this Act sections | Act of 1935 former n'sections 215-228 of this title | based in whole or in part on service | rendered prior to January 1, 1937 | shall receive a pension payment under | this section subsequent to the payment | due on October 1, 1937 * * *. | The annuity claims of such individuals | who receive pension payments under | this section shall be adjudicated in the o Provided, however, That no such individual | shall be entitled to receive | both a pension under this section and p this Act sections | 228a-228r or the Railroad Retirement | Act of 1935 former sections | 215-228 of this title | and in the event pension payments | have been made to any such individual | in any month in which such individual | is entitled to an annuity under this | Act sections 228a-228r or the Railroad | Retirement Act of 1935 former | sections 215-228 of this title, the difference q

The Board makes, we believe, six main arguments in support of its construction that plaintiff's eligibility under section 2 cannot be considered inasmuch as she is receiving a pension under subsection 6(a): (1) Section 6, by its basic plan, divides those receiving retirement benefits as of July 1, 1937, into two mutually exclusive permanent groups — annuitants and pensioners. In this connection, the provision of subsection 6(a) that the pensions shall be paid for life (m') is stressed. (2) This mutually exclusive permanent interpretation explains, and no other would, the provision in subsection 6(b) that pension payments are to cease by October 1, 1937 (n), for those eligible on July 1st of that year (n'). (3) The provision in subsection 6(b) that the annuities of those eligible on July 1, 1937, shall be determined as though no pension payments had been made (o) also supports the mutually exclusive permanent interpretation. (4) Likewise, the provision in subsection 6(b) for adjustment in respect of this July 1st group to prevent duplication of payments (q) evinces the mutually exclusive permanent interpretation. (5) Congress has given no direction for changing from one group to another, except in subsection 6(b), which is inapplicable here; there is not even a statutory statement of whether the change would be optional. (6) If the mutually exclusive permanent interpretation is not followed, there is a likelihood that a person will receive both a pension and an annuity.

Miss Bates countered with three main arguments: (1) To determine whether one is eligible for an annuity you should look only to the annuity section. (2) Subsection 6(a) sets up the pension plan and makes no reference to section 2, let alone prohibiting the granting of an annuity to one holding a pension. (3) Subsection 6(b) is written for a special group which does not include her; no inferences should be drawn from it to prevent her receiving an annuity. Miss Bates concludes that she is entitled to an annuity in lieu of her pension, and suggests that maybe she should receive both.

No construction of the Act for application to this case is free from obstacles. As the Board has shown it is difficult to construe the Act so as to permit a transfer from pensions to annuities. Likewise, it is difficult to believe that the proper construction of the Act is to allow...