Waggoner v. Waggoner

• Decision Date: 17 December 1992
• Docket Number: No. 91-SC-440-DG,91-SC-440-DG
• Citation: 846 S.W.2d 704
• Parties: 81 Ed. Law Rep. 347 Roberta L. WAGGONER, Appellant, v. William E. WAGGONER, Appellee.
• Court: United States State Supreme Court — District of Kentucky

Page 704

846 S.W.2d 704

81 Ed. Law Rep. 347

Roberta L. WAGGONER, Appellant, v. William E. WAGGONER, Appellee.

No. 91-SC-440-DG.

Supreme Court of Kentucky.

Dec. 17, 1992.

Rehearing Denied March 18, 1993.

Jennifer B. Coffman, Ron L. Walker, Lexington, for appellant.

Robert W. Miller, Grayson, for appellee.

STEPHENS, Chief Justice.

This appeal asks our Court: (1) to determine the constitutionality of KRS 161.700(2), a provision that exempts contributions to the Teachers' Retirement System (hereinafter "TRS") from division as marital property under KRS 403.190(4) and (2) to determine whether the challenged provision KRS 161.700(2), provides that:

may be applied to TRS contributions made prior to the statute's effective date.

Retirement allowance, disability allowance, accumulated contributions, or any other benefit under the retirement system shall not be classified as marital property pursuant to KRS 403.190(1). Retirement allowance, disability allowance, accumulated contributions, or any other benefit under the retirement system shall not be considered as an economic circumstance during the division of marital property in an action for dissolution of marriage pursuant to KRS 403.190(1)(d).

Appellant, Roberta L. Waggoner, a teacher in the Carter County Public Schools for thirty-six years, mandatorily contributed to the TRS toward her retirement. She filed for dissolution of marriage on October 25, 1988. In preparing to divide marital property, appellee, William E. Waggoner, thereupon filed a notice of deposition and served a subpoena on an employee of the TRS. Appellant, in response, filed a motion to prohibit the taking of the deposition. Appellant asserted that KRS 161.700(2) excluded contributions to TRS from consideration as an "economic circumstance" in the classification of marital property pursuant to KRS 403.190. Appellant claimed facts surrounding her TRS contributions were inadmissible under CR 26.01, since information sought in deposition or through any other discovery process could not produce admissible evidence. Appellee then filed a motion to compel discovery by court order. The trial court overruled appellee's motion.

Appellee, in January of 1989, filed a motion asserting that KRS 161.700(2) was unconstitutional, or in the alternative, that if the challenged statute was declared valid, he had a vested right in the portion of the TRS contributions made before July 1, 1980, the effective date of KRS 161.700(2). The Attorney General, while properly notified of appellee's constitutional challenge of the statute, failed to intervene.

The trial court overruled appellee's motion and found that KRS 161.700 was not violative of the Fourteenth Amendment of the United States Constitution, nor did the court find it violative of Sections 1, 2, 3, and 59 of the Kentucky Constitution. The trial court found that TRS contributions were nonmarital property, were privileged information, and therefore were not subject to discovery.

Dissolution of the Waggoner marriage was entered on June 5, 1989. Following this entry, appellee filed a motion to alter, vacate, or amend the dissolution decree. The motion was overruled. Appellee then sought review before the Court of Appeals. The Court of Appeals held that KRS 161.700(2) was unconstitutional and unenforceable because it denied equal protection of the law. The Court also found the statute to be a prohibited special law under Section 59 of the Kentucky Constitution. The Court of Appeals reversed the judgment of the circuit court and directed the trial court to allow discovery of appellant's contributions to TRS and to appropriately divide the benefits.

We reverse the Court of Appeals opinion and affirm the decision of the trial court which found that the challenged provision is neither a prohibited special law under Section 59 of the Kentucky Constitution, nor is it violative of appellee's rights under equal protection. We find no invalid retrospective application of the challenged provision to contributions made before the statute's effective date.

SECTION 59 OF THE KENTUCKY CONSTITUTION

Section 59 of the Kentucky Constitution prohibits the General Assembly from passing local or special Acts concerning any of the twenty-eight (28) subjects which are specifically enumerated. Section 59 further provides that "[i]n all other cases where a general law can be made applicable, no special law shall be enacted."

A general law relates to persons or things as a class, while a special law relates to particular persons or things of a class. Johnson v. Commonwealth, 291 Ky. 829, 165 S.W.2d 820 (1942).

The fact that the General Assembly deals with a special subject does not Legislation, in order to pass constitutional muster under Section 59, must meet the requirements set forth in Schoo v. Rose, Ky., 270 S.W.2d 940 (1954). Schoo requires that the legislation (1) apply equally to all in a class and (2) have distinctive and natural reasons inducing and supporting the classification. Schoo at 941.

                per se make it special legislation.  Kentucky Milk Mktg. & Anti-Mon.  Com'n v. Borden, Co., Ky., 456 S.W.2d 831 (1970).   Classifications based upon reasonable and natural distinctions that relate logically to the purpose of the Act do not violate Section 59 of the Kentucky Constitution.  Kling v. Geary, Ky., 667 S.W.2d 379 (1984)
                

Appellant asserts that KRS 161.700(2) is not a special law because it meets both prongs of the test found in Schoo. The class created by the statute, appellant argues, includes all the teachers within the Commonwealth and their spouses. Since KRS 161.700(2) applies to every member in this class equally, appellant reasons the first prong of the Schoo test is satisfied.

The second prong of the test is also satisfied, appellant claims, because the General Assembly had a distinct and reasonable basis for enacting KRS 161.700(2). Reasons appellant postures for the enactment of the statute are: 1) that the TRS was created to mirror the Social Security system plan since teachers are the only state employees not covered by Social Security; 2) that the TRS plan provides an incentive for teachers to remain in the field and to attract new instructors because it assures adequate compensation; and 3) that the TRS removes from society the total responsibility of providing financial assistance to retired teachers.

The Court of Appeals found appellant's definition of the class of persons that KRS 161.700(2) covers as being to narrow. The Court agreed with appellee's assertion that the classification included all married persons with retirement benefits who are seeking a divorce. Appellee asserts that because the challenged statute took a natural class of persons, divided them arbitrarily and enacted different rules to govern each faction, KRS 161.700(2) is prohibited special legislation.

The responsibility of this Court is to draw all reasonable inferences and implications from the act as a whole and thereby sustain its validity. Graham v. Mills, Ky., 694 S.W.2d 698 (1985). Citing Tabler v. Wallace, Ky., 704 S.W.2d 179 (1986), appellee asserts that because the statute's title, preamble, and subject matter fail to specify justification for the classification it forms, it is invalid under Section 59 of Kentucky Constitution. In Tabler, at 186, we stated that to sustain a classification under Section 59 that

there must be a substantial and justifiable reason [for the classification] apparent from legislative history, from the statute's title, preamble or subject matter, or from some other authoritative source.

Unlike Tabler, where no substantial reason was presented to rationally justify creating a special class, the history behind the enactment of the Teachers' Retirement Act explains the special purpose underlying the classification that KRS 161.700(2) creates. When the Social Security Act was amended to allow states to enter into a voluntary agreement to provide Social Security coverage for their employees, the Kentucky General Assembly passed KRS 61.410 that excepted coverage of Social Security for state employees already under a retirement system. Teachers were therefore excluded from participating in the Social Security program because they were covered by the TRS. See KRS 61.410 et seq. Thus there is a reasonable basis for the General Assembly to distinguish between classes in the challenged provision. Kentucky Milk Mktg. & Anti-Mon. Com'n v. Borden Co., Furthermore, as appellant asserts, the TRS serves as an incentive to attract and retain teachers, as other retirement systems have been found to do. See Hisquierdo v. Hisquierdo, 439 U.S. 572, 99 S.Ct. 802, 59 L.Ed.2d 1 (1979); Hyde v. Haunost, Ky., 530 S.W.2d 374 (1975).

Because KRS 161.700(2) is applied equally to all, the first prong of the Schoo test is satisfied. The second prong of the test is also satisfied because a distinctive and natural reason exists which supports the classification. We therefore find that even

though KRS 161.700(2) sets teachers up as a special class, the provision does not violate Section 59 of the Kentucky Constitution.

EQUAL PROTECTION

Legislation will be upheld under equal protection principles of the federal and state constitutions if the law is rationally related to a legitimate objective. McGowan v. State of Maryland, 366 U.S. 420, 425-426, 81 S.Ct. 1101, 1104-1105, 6 L.Ed.2d 393 (1961); Kentucky Ass'n of Chiropractors, Inc. v. Jefferson County Medical Society, Ky., 549 S.W.2d 817, 822 (1977). The constitutionality of a statute will be upheld if its classification is not arbitrary, or if it is founded upon any substantial distinction suggesting the necessity, or propriety, of such legislation.

We previously noted that the basis for the classification that the challenged provision creates is founded on the fact that teachers are the only public employees not covered by the Social Security system. The General Assembly, therefore enacted legislation forming the...