ROBINSON v. CITY of WICHITA EMPLOYEES' Ret. Bd. of Tr.S

• Decision Date: 08 October 2010
• Docket Number: No. 102,217.,102
• Citation: 241 P.3d 15
• Parties: Cindy L. ROBINSON, Appellee, v. CITY OF WICHITA EMPLOYEES' RETIREMENT BOARD OF TRUSTEES and The City of Wichita, Kansas, Appellants.
• Court: Kansas Supreme Court

241 P.3d 15

Cindy L. ROBINSON, Appellee,
v.
CITY OF WICHITA EMPLOYEES' RETIREMENT BOARD OF TRUSTEES and The City of Wichita, Kansas, Appellants.

No. 102,217.

Supreme Court of Kansas.

Oct. 8, 2010.

241 P.3d 16

COPYRIGHT MATERIAL OMITTED.

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Syllabus by the Court

1. District courts have jurisdiction under K.S.A. 60-2101(d) to review the action of a political subdivision exercising judicial or quasi-judicial functions. In such circumstances, a district court is limited to determining if the political subdivision's decision was within its scope of authority, was substantially supported by evidence, or was fraudulent, arbitrary, or capricious. On appeal from the district court, an appellate court reviews the political subdivision's decision as though the initial appeal had been made directly to the appellate court.

2. Arbitrary, as applied to reviews under K.S.A. 60-2101(d), means without adequate determining principles, not done or acting according to reason or judgment, and capricious means changing, apparently without regard to any laws.

3. Under the arbitrary and capricious standard applied to appellate review based on K.S.A. 60-2101(d), a board or agency interpreting a statute, ordinance, or regulation is deemed to have acted arbitrarily and capriciously when its decision is not based on a reasonable interpretation of the provision's terms and is not made in good faith.

4. An administrative agency's interpretation of a statute is not conclusive, and final construction of a statute always rests with the courts.

5. The interpretation of a municipal ordinance presents a question of law over which an appellate court has unlimited review.

6. Courts apply the same rules when interpreting a municipal ordinance as applied when interpreting a statute. Under those rules, when a statute or municipal ordinance is plain and unambiguous, a court must

give effect to express language, rather than determine what the law should or should not be. A court will not speculate on legislative intent

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and will not read the provision to add something not readily found in it. If the provision's language is clear, there is no need to resort to statutory construction.

7. Wichita City Code Section 2.28.150(d)(3), which provides that “[a]ny amount received under the State Worker's Compensation Act (except medical expenses) shall be deducted from the [City's] disability retirement benefit,” clearly and unambiguously means the disability retirement benefit will be reduced by the full amount of the workers compensation award without exception for attorney fees incurred in obtaining the workers compensation award.

8. Specific statutes control over general ones.

9. Provisions allowing an award of attorney fees are not passed to benefit the attorney or to burden litigants. Rather, they are passed to enable litigants to obtain competent counsel.

10. The common fund doctrine permits a party who creates, preserves, or increases the value of a fund in which others have an interest to be reimbursed from that fund for litigation expenses incurred, including attorney fees, and reflects the traditional practice in courts of equity.

11. The common fund doctrine stands as a well-recognized narrow exception to the general principle that requires every litigant to bear his or her own attorney fees and rests on the perception that persons who obtain the benefit of a lawsuit without contributing to its cost are unjustly enriched at the successful litigant's expense. The rationale for awarding attorney fees out of a common fund is that the attorney's services benefit the fund by creating, increasing, or preserving the fund.

12. The common fund doctrine does not apply when a clear and unambiguous provision requires the reduction of a disability retirement award by the entire amount of a workers compensation award, without specifically excluding attorney fees incurred in obtaining the workers compensation award.

Brian K. McLeod, deputy city attorney, of Wichita, argued the cause and was on the briefs for appellants.

David P. Calvert, of David P. Calvert, P.A., of Wichita, argued the cause and was on the brief for appellee.

PER CURIAM:

Cindy Robinson, a former employee of the City of Wichita, filed a claim for disability retirement benefits with the City of Wichita Employees' Retirement Board of Trustees (Retirement Board). The Retirement Board calculated Robinson's disability retirement benefit and then reduced it by the entire amount of a workers compensation award that Robinson had already obtained. This deduction resulted from the application of Section 2.28.150(d) (3) of the Wichita City Code (Wichita Code), which requires that “[a]ny amount received under the State Worker's Compensation Act (except medical expenses) shall be deducted from the disability retirement benefit.” The issue before us is whether the amount to be deducted from the disability retirement benefit is the entire workers compensation award or the amount of the award remaining after payment of Robinson's attorney fees.

We conclude the Retirement Board reasonably decided that Wichita Code Section 2.28.150(d)(3) does not except attorney fees from the deduction, properly rejected policy arguments in light of the unambiguous provision, and correctly refused to apply the common-law doctrine that requires sharing of attorney fees by those who benefit from a common fund. Therefore, we affirm the Retirement Board's decision and reverse the district court's decision, which in an administrative appeal had reversed the Retirement Board.

Facts

Robinson suffered employment-related injuries to her bilateral upper extremities as a gardener employed by the City of Wichita. The date of injury was April 5, 2002. Robinson filed a claim for workers compensation benefits and entered into an agreed award that totaled $125,000. Per a prior attorney fee agreement, approved

in the workers compensation

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proceeding, Robinson's workers compensation attorney received a 25 percent contingency fee for his work on the case, or $31,250. This amount was paid out of the workers compensation award, with a pro rata share deducted from Robinson's bi-weekly temporary total disability benefits.

In June 2008, Robinson filed her disability retirement claim with the Retirement Board. The Retirement Board approved Robinson's request, retroactively effective July 20, 2002, but reduced the amount of available disability retirement benefits by $125,000, the entire amount awarded for workers compensation benefits. The Retirement Board determined that the deduction was required under Wichita Code Section 2.28.150(d)(3).

Robinson filed a request to modify the Retirement Board's award, arguing that the deduction should not include the workers compensation attorney fees because, although she was awarded $125,000 in workers compensation benefits, she did not actually “receive” the portion that would be paid to her attorney. In other words, the workers compensation deduction should have been reduced to $93,750 ($125,000 minus $31,250 in attorney fees). The Retirement Board, after conducting a discussion and hearing statements of counsel on this matter of first impression, issued its final decision, denying Robinson's request for modification and determining “to keep its current practices and ordinances in place.”

Robinson filed an appeal in the district court pursuant to K.S.A. 60-2101(d). The district court agreed with Robinson and found that the Retirement Board incorrectly calculated her disability retirement benefits. The district court concluded the Retirement Board was only entitled to deduct the amount of workers compensation benefits “actually received” by Robinson and should not have included attorney fees in the deduction. In the district court's journal entry of judgment, the court based its decision on five findings: (1) reducing the disability retirement benefit by the amount of the workers compensation attorney fees “creates a hardship” on Robinson “and will not be permitted because that action thwarts the very purpose of the disability retirement plan”; (2) “Kansas, along with virtually every other state and the federal courts, has adopted the common fund doctrine which permits a party who creates,

preserves or increases the value of a fund in which others have an interest, which includes the Respondent's retirement fund, to be reimbursed from that fund for attorney fees”; (3) deducting the attorney fees penalizes Robinson for exercising her statutory right to recover workers compensation benefits; (4) the Retirement Board's action and its interpretation of the ordinance was arbitrary and capricious; and (5) the Retirement Board could not rely on a “long-standing policy which it contends permits it to deduct the entire $125,000 including attorney fees because there is no such policy.”

The district court reversed the Retirement Board's decision and granted judgment for Robinson in the amount of $31,250 plus costs. The Retirement Board now makes a timely appeal. The case was transferred to this court pursuant to K.S.A. 20-3018(c).

Analysis

[1] [2] [3] Robinson's appeal from the Retirement Board's decision is based on K.S.A. 60-2101(d). This statute confers jurisdiction on a district court to review the action of a political subdivision exercising “judicial or quasi-judicial functions.” In such circumstances, the district court is limited to determining if the Retirement Board's decision was within its scope of authority, was substantially supported by evidence, or was fraudulent, arbitrary, or capricious. On appeal from the district court, an appellate court reviews the Retirement Board's decision as though the initial appeal had been made directly to the appellate court. See Butler v. U.S.D. No. 440, 244 Kan. 458, 464, 769 P.2d 651 (1989).

In this case, Robinson has not argued that the Retirement Board acted outside its scope of authority. Nor, at least before us, is there...