Bates v. Tennessee Consolidated Retirement System ex rel. Ashley

563 S.W.2d 192, 1977 Tenn. App. LEXIS 269
CourtCourt of Appeals of Tennessee
DecidedDecember 2, 1977
StatusPublished
Cited by3 cases

This text of 563 S.W.2d 192 (Bates v. Tennessee Consolidated Retirement System ex rel. Ashley) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bates v. Tennessee Consolidated Retirement System ex rel. Ashley, 563 S.W.2d 192, 1977 Tenn. App. LEXIS 269 (Tenn. Ct. App. 1977).

Opinion

ABRIDGED OPINION

(With the approval of participating judges, the original Opinion has been abridged for publication)

TODD, Judge.

The plaintiffs brought this as a class action for the benefit of all affected county officials for a determination and declaration of their rights under various enactments of the General Assembly relating to retirement systems for county officials. From an adverse decree, plaintiffs have appealed. There is no appeal by defendants from adverse portions of the Chancellor’s decree.

In 1972, the General Assembly created the Tennessee Consolidated Retirement System by Chapter 814, Public Acts of 1972 (Adj.S.). Said act is codified as Chapter 39, Title 8, Tennessee Code Annotated §§ 8-3901 — 8-3949 inclusive.

[194]*194At the time of the enactment of the foregoing statute, plaintiffs were not members of any State Retirement System, but were members of local systems.

In 1973, the General Assembly enacted Chapter 347 of the Public Acts of 1973 which added subsection (f) to § 8-3924, T.C.A., as follows:

“Anything to the contrary notwithstanding, any member who: (1) served in any position covered by any of the superseded systems or (2) served in a capacity covered by a superseded system or (3) had service that would have been covered in one of the other superseded systems (provided it had been in existence) may now claim such service in the superseded system which he would have been a member had that system been in existence provided the member shows proper documentation as required by the Board of Trustees of the Tennessee Consolidated Retirement System.
“Be it further provided that such member pay in a lump sum an amount equal to that amount he would have contributed had he been a member of the applicable superseded system plus 6% interest per annum. Any member upon retiring shall be eligible to use the aggregate number of years in all systems to qualify for retirement; however, his benefits shall be computed under the applicable provisions of each superseded system based on the aggregate number of years in each superseded system or the Tennessee Consolidated Retirement System to determine his total benefits. Provided, however, the retirement allowance payable to such member shall not be less than the benefit determined on total years of service under Group I.”

After the effective date of the 1973 act, the director of the County Officials Retirement System informed all county officials of the passage of the act and stated that it was mandatory for them to become members of the Tennessee Consolidated Retirement System as provided in said act. Plaintiffs complied with said notice by paying to the Tennessee Consolidated Retirement System the amounts required and demanded.

In 1975, The General Assembly enacted Chapter 315 of the Public Acts of 1975, effective June 30, 1975. Pertinent portions of said act are as follows:

Section 1. prohibits membership in more than one public employees retirement system and/or accrual of duplicate retirement benefits in separate public systems based upon the same service and compensation. This section was incorporated into § 8-3903, T.C.A.

Sections 5. and 6. attempted to change the retirement base of superseded systems.

Section 7. limited the retirement allowance to any member of superseded systems to 100 per cent of the final compensation except for cost of living increases.

The Chancellor held:

Section 1. is not unconstitutional.

Section 5. and 6. are unconstitutional and void.

Section 7. does not affect the rights of any of the plaintiffs who have no standing to challenge it.

All plaintiffs are entitled to a refund with interest of amounts paid for prior service pension rights which are disallowed by the decree.

All plaintiffs have appealed except one who withdrew from the case.

The assignments of error are as follows:

“1. The Chancellor erred in holding that plaintiffs were not entitled to claim prior service credit under the Tennessee Consolidated Retirement System for service credited to them under the local system.
“2. The Chancellor erred in holding that the rights of plaintiffs were not vested.
“3. The Chancellor erred in holding that plaintiffs were not deprived of a property right without due process of law.
“4. The Chancellor erred in holding that when plaintiffs made their payment to the Tennessee Consolidated. Retire[195]*195ment System they did not have a contract right to receive benefits from the prior service claimed.
“5. The Chancellor erred in holding that officials of the Tennessee Consolidated Retirement System could not bind the system or estop the system from taking a contrary position, even though plaintiffs had relied upon the action of the officials and paid their money into the retirement system.
“6. The Chancellor erred in giving Chapter 315 of the Acts of 1975 retroactive effect.
“7. The Chancellor erred in holding that plaintiffs did not have standing to question the validity of Section 7 of Chapter 315 of the Public Acts of 1975, as applied retroactively.
“8. The Chancellor erred in holding that plaintiffs were not eligible for membership in the Tennessee Consolidated Retirement System at the time they paid their money into that system.

It is apparent that this controversy arose because, in 1973, the Legislature provided that county officials might join the Consolidated System without specifically providing that this might not be done to obtain duplicate benefits, that is, that a county official must relinquish his rights in one system in order to obtain rights in another.

After the plaintiffs had paid the necessary amounts to “buy into” the Consolidated System, Chapter 315 of the 1975 Acts, passed “after the fact,” undertook to retroactively declare and enforce a public policy against dual public pensions. This is plaintiffs’ principal complaint.

Defendant’s response to this complaint is that plaintiffs never had a vested right to acquire or claim dual pensions at public expense.

At this point, there should be a clarifying statement concerning the meaning and effect of Chapter 347 of the Public Acts of 1973, quoted supra.

Appellants conceive that the statute authorized their admission to the “new” Tennessee Consolidated Retirement System which, at that time, contained no specific prohibition against duplicate or dual public worker pensions. However the wording of the quoted act precludes any such interpretation in the words:

“. . . may now claim such service in the superseded system . . . .”

This Court interprets subsection (f), supra, to mean:

“Those persons who are not now members of a superseded system may now retroactively become a member of that superseded system and thereby become a member of the new Tennessee Consolidated Retirement System as a member of such superseded system ; but the delayed entry into the superseded system must be on the same terms as would have applied to a normal entry into such system.”

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763 S.W.2d 739 (Tennessee Supreme Court, 1988)

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Bluebook (online)
563 S.W.2d 192, 1977 Tenn. App. LEXIS 269, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bates-v-tennessee-consolidated-retirement-system-ex-rel-ashley-tennctapp-1977.