Government of Guam Major Fred M. Chargualaf v. Government of Guam Retirement Fund , 2021 Guam 17 ( 2021 )

IN THE SUPREME COURT OF GUAM
GUAM POLICE DEPARTMENT MAJOR FRED M. CHARGUALAF,
Petitioner-Appellant,
v.
GOVERNMENT OF GUAM RETIREMENT FUND,
Respondent-Appellee.
Supreme Court Case No.: CVA19-019
Superior Court Case No.: SP0007-18
OPINION
Cite as: 2021 Guam 17Appeal from the Superior Court of Guam
Argued and submitted on February 12, 2021
Via Zoom video conference
Appearing for Petitioner-Appellant: Appearing for Respondent-Appellee:
Joshua D. Walsh, Esq. Joanne L. Grimes, Esq.
Razzano Walsh & Torres, P.C. Carlsmith Ball LLP
139 Murray Blvd., Ste. 100 1001 Bishop Street, Ste. 2100
Hagåtña, GU 96910 Honolulu, HI 96813
Vincent C. Camacho, Esq.
Camacho Calvo Law Group LLC
356 E. Marine Corps Dr., Ste. 201
Hagåtña, GU 96910
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 2 of 21
BEFORE: F. PHILIP CARBULLIDO, Chief Justice; ROBERT J. TORRES, Associate Justice;
and ALEXANDRO C. CASTRO, Justice Pro Tempore.
CARBULLIDO, C.J.:
[1] Petitioner-Appellant Major Fred M. Chargualaf of the Guam Police Department appeals a
decision of the Superior Court upholding a Declaratory Ruling by the Government of Guam
Retirement Fund, which declined to adopt Major Chargualaf’s interpretation of statutes relating to
the definition of “average annual salary” for the computation of pension annuities. Major
Chargualaf appeals on the grounds that the trial court’s interpretation of the relevant statutes is
incorrect and that his due process rights were violated when he was denied a hearing by the
Government of Guam Retirement Fund and discovery by the Superior Court. We disagree and
affirm the judgment of the trial court.
I. FACTUAL AND PROCEDURAL BACKGROUND
[2] The primary facts are not disputed. Fred M. Chargualaf has been employed by the Guam
Police Department (GPD) since 1984 and holds the rank of Major. He is enrolled in the
Government of Guam Retirement Fund (GGRF) Defined Benefit Plan. While Major Chargualaf
was employed by GPD, the Guam Legislature enacted certain pay increases for which Major
Chargualaf was later awarded several lump-sum payments as retroactive compensation. In 2013,
he received $22,848.63 “that was attributable to services he performed in, and credited to, the years
2000–2008.” Record on Appeal (“RA”), tab 11 (Decl. Joshua D. Walsh, Aug. 31, 2018), Ex. B
(Bd. Dirs.’ Dec., Dec. 27, 2017). Major Chargualaf also received $23,886.28 in 2013, $23,886.28
in 2014, and $2,894.38 in 2015 “that was attributable to Law Enforcement Officer (“LEO”)
services performed over, and credited to, the years 2009–2013.” Id. Those lump-sum amounts
were not tied to any credited service performed in the years he received those amounts. The
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 3 of 21
amounts of these lump sums are undisputed, and both parties agree that the lump sums were
awarded as retroactive compensation.
[3] In contemplation of future retirement, Major Chargualaf “asked the Fund to provide him
with an estimate of the annuity benefits he would receive upon his retirement, computed as of an
assumed future retirement date.” RA, tab 5 at 2 (V. Answer to Pet., Apr. 17, 2018). As part of its
calculations and under its interpretation of the requirements of 4 GCA § 8122(a), the Fund
determined that Major Chargualaf’s “average annual salary” for purposes of calculating his
retirement annuity would be approximately $110,440.95. RA, tab 11, Ex. B (Bd. Dirs.’ Dec.)
(average annual salary chart).1 GGRF arrived at this figure using Major Chargualaf’s base salary
for the years 2013, 2014, and 2015, but not including the lump-sum payments received because
“average annual salary is inextricably tied to [an employee’s] performance of creditable service
rather than to the timing of payroll receipts,” and the lump sums in question were “not tied to any
credited service” in the years in which they were paid. RA, tab 11, Ex. B (Bd. Dirs.’ Dec.).
[4] Major Chargualaf disagreed, believing that the relevant statutes required his annuity to be
calculated using his W-2GUs, to include the retroactive amounts paid to him in 2013, 2014, and
2015 as part of the “salaries” of the years in which they were received. RA, tab 39 at 2 (Dec. &
Order, Aug. 27, 2019). He submitted a Verified Petition for Declaratory Ruling to GGRF under 2
Guam Admin. R. & Regs. (“GAR”) § 3101(5), asking GGRF to declare that his annuity upon
retirement should be calculated accordingly. The GGRF Board of Directors issued a decision on
Major Chargualaf’s request for a declaratory ruling, declining to adopt his interpretation. In the
decision, GGRF informed Major Chargualaf that the decision of the Board was final and “not
1
In its Supplemental Excerpts of Record, GGRF included the Verified Petition for Declaratory Ruling of
April 14, 2017, an exhibit of which contained a different figure of approximately $105,600. However, this document
is not part of the record on appeal, and litigants are reminded that they cannot include in their excerpts of record any
documents which do not form part of the record.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 4 of 21
subject to reconsideration,” but that he had the “right to request judicial review of the Board’s
decision in accordance with 5 GCA § 9241.” RA, tab 11, Ex. B (Bd. Dirs.’ Dec.).
[5] Major Chargualaf filed a Verified Petition for Writ of Mandate, asking the Superior Court
to overturn the decision of GGRF and adopt an interpretation of the relevant statutes that would
include lump-sum payments in the salary of the years in which they were received. During a
scheduling hearing, Major Chargualaf asked the court to entertain a motion for discovery, which
GGRF opposed because there was no factual dispute but merely a legal question of statutory
interpretation. The court asked Major Chargualaf to brief the discovery issue alongside his brief
on the merits, but ultimately the court did not address the request for discovery in its Decision and
Order denying the petition. This appeal followed.
II. JURISDICTION
[6] This court has jurisdiction over an appeal from a final judgment of the Superior Court of
Guam under 48 U.S.C.A. § 1424-1(a)(2) (Westlaw through Pub. L. 117-57 (2021)) and 7 GCA §§
3107 and 3108(a) (2005). However, the trial court did not enter a separate document setting forth
the entry of a final judgment when the Notice of Appeal was filed on September 25, 2019, as
required by Rule 58(a)(1) of the Guam Rules of Civil Procedure. If no separate judgment is
entered, a judgment may be effectively entered, for the purpose of the separate document rule, 150
days after entry on the docket of the underlying Decision and Order. Guam R. Civ. P. 58(b)(2)(B);
Agana Beach Condo. Homeowners’ Ass’n v. Untalan, 2015 Guam 35 ¶ 10. The Superior Court’s
Decision and Order denying Appellant’s Verified Petition for Writ of Mandate resolved all issues
in the litigation and was entered on August 27, 2019, meaning that the judgment was effectively
entered 150 days later on January 24, 2020. Major Chargualaf filed his Notice of Appeal on
September 25, 2019. Although this was prior to the effective entry of judgment, the appeal was
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 5 of 21
timely because Guam Rule of Appellate Procedure 4(a)(2) treats a notice of appeal filed after the
announcement of a decision or order but before the entry of judgment as filed on the date of and
after the entry. Agana Beach, 2015 Guam 35 ¶ 10. Our jurisdiction is preserved despite the lack
of a renewed notice of appeal. Id.III. STANDARD OF REVIEW
[7] Issues of statutory interpretation are reviewed de novo, including an agency’s interpretation
of a statute. Ada v. Guam Tel. Auth., 1999 Guam 10 ¶ 10. We generally review the denial of a
petition for writ of mandate for an abuse of discretion. Agana Beach, 2015 Guam 35 ¶ 12. “But
where there are no facts in dispute and the questions presented for review are strictly questions of
law[,] the court’s review is de novo.” Guam Election Comm’n v. Responsible Choices for All
Adults Coal., 2007 Guam 20 ¶ 23 (citing Guam Fed’n of Teachers ex rel. Rector v. Perez, 2005
Guam 25 ¶ 13).
[8] Generally, “[the trial] court’s legal conclusion that [an appellant’s] due process rights were
not violated by an unfair administrative hearing is reviewed de novo.” Perez v. Civil Serv. Comm’n
(Guam Dep’t of Educ.), 2018 Guam 25 ¶ 26 (second alteration in original) (quoting Sule v. Guam
Bd. of Dental Exam’rs, 2008 Guam 20 ¶ 11). Although no administrative hearing was conducted,
the question of whether GGRF’s determination violated the due process rights of Major Chargualaf
is likewise reviewed de novo. See Responsible Choices, 2007 Guam 20 ¶ 24 (“Whether a
constitutional right has been violated is considered de novo.”).
IV. ANALYSIS
A. The Trial Court Did Not Err in Upholding GGRF’s Interpretation of the Relevant
Statutes on the Calculation of Average Annual Salary in Relation to Retirement Benefits
[9] The primary issue is the correct interpretation of 4 GCA § 8104 and related provisions as
they pertain to the calculation of annuities due under the GGRF Defined Benefit Plan—a question
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 6 of 21
of law. The parties do not disagree as to the essential facts: Major Chargualaf is a member of the
Defined Benefit Plan and will be eligible to receive an annuity upon retirement. The amounts
earned by Major Chargualaf also are not disputed. Thus, de novo review is appropriate.
[10] Upon de novo review, we affirm the decision of the Superior Court because (1) GGRF’s
determination is not entitled to Chevron deference; (2) the court was not limited to the rationale
forwarded by GGRF; (3) the plain language of the statute is ambiguous; and (4) the ambiguity can
be resolved through the absurdity doctrine and legislative intent.
1. No deference due to GGRF’s determination
[11] Although the theory was advanced before the Superior Court, GGRF does not challenge in
its appellate brief the Superior Court’s finding that Chevron deference does not apply. See
Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984). The Chevron doctrine
applies “only where the legislature ‘understood that the ambiguity would be resolved, first and
foremost, by the agency, and desired the agency (rather than the courts) to possess whatever degree
of discretion the ambiguity allows.’” Port Auth. of Guam v. Civil Serv. Comm’n (Javelosa), 2018
Guam 9 ¶ 8 (quoting City of Arlington, Tex. v. FCC, 569 U.S. 290, 296 (2013)). In other words,
“Chevron deference will apply only where the legislature expressly or implicitly intended it to
apply,” and “interpretive rules” generally do not enjoy such deference. Id. As the trial court
explained, 4 GCA §§ 8139 and 8139.1 “do not appear to be [a] grant of authority by the legislature
for the GGRF to interpret ambiguities in the terms defined in [4 GCA §] 8104, but merely the [sic]
authorized the GGRF to freely control its operations and granted latitude in how it would ensure
the fund remains solvent.” RA, tab 39 at 6 (Dec. & Order, Aug. 27, 2019). The trial court held
that Chevron should not apply because “[i]t is clear from the plain language of Section 8104 that
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 7 of 21
the Legislature intended to set specific definitions which would be used by the board in
determining annuity calculations.” Id. at 6–7.
[12] We agree that Chevron deference does not apply. The definitions do not contemplate
ambiguities that should be resolved by GGRF; rather, they are intended as a complete expression
by the legislature. The definitions of words and phrases in section 8104 apply “unless a different
meaning is clearly indicated by the context.” 4 GCA § 8104 (as amended by Pub. L. 35-068:2
(Feb. 13, 2020)). Language within the “Statement of Legislative Concern” requires GGRF to
submit to the legislature any “recommendations of amendments that need be made to the law
establishing the Fund to protect and preserve the actuarial soundness of the Fund for the benefits
of all its members,” 4 GCA § 8101.1(b) (2005), suggesting that GGRF alone was not given
discretion to resolve definitional ambiguities even if doing so would protect the Fund. Thus, the
Superior Court was correct in finding that Chevron deference does not apply.2
2. The Trial Court Was Not Limited to the Rationale Forwarded by the Agency for
Upholding Its Interpretation of a Statute
[13] Major Chargualaf cites Perez v. Civil Service Commission (Guam Department of
Education), 2018 Guam 25, to argue that the trial court was limited to a “binary choice” between
“accept[ing] the agency’s determination based upon the articulated rationale from the agency, or
reject[ing] the agency determination because the agency’s determination is flawed.” Appellant’s
Br. at 23 (Jan. 13, 2020). Accordingly, Major Chargualaf argues it was error for the trial court to
2
GGRF alternatively argues that its determination is due deference because of its status as a trustee. This
argument fails for the same reason that Chevron deference fails—there is no support for the notion that the legislature
intended to vest GGRF with discretion to resolve definitional ambiguities on its own. GGRF quotes Firestone Tire &
Rubber Co. v. Bruch, 489 U.S. 101 (1989), for the proposition that “[a] trustee may be given power to construe disputed
or doubtful terms, and in such circumstances the trustee’s interpretation will not be disturbed if reasonable,”
Appellee’s Br. at 19 (Feb. 26, 2020) (quoting Firestone, 489 U.S. at 111), but offers no proof to its assertion that the
“Legislature explicitly intended to confer great discretion to the Fund in implementing Chapter 8 of Title 4 of the
Guam Code Annotated,” id. at 20. Without a showing of vested discretion, GGRF is not entitled to deference as a
trustee.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 8 of 21
go “beyond the developed record” and confirm GGRF’s interpretation not based on a plain
language analysis, as GGRF had argued, but based on the absurdity doctrine, a theory that GGRF
had not advanced. Appellant’s Br. at 2, 22–23.
[14] However, this argument results from a misreading of a quote from Perez that a reviewing
court “may not substitute its views for those of the [agency], but instead must accept the [agency’s]
findings unless they are contrary to law, irrational, or unsupported by substantial evidence.” Perez,
2018 Guam 25 ¶ 9 (alterations in original) (quoting Fagan v. Dell’Isola, 2006 Guam 11 ¶ 11).
When the quote is followed to its source in Fagan, and indeed to the Ninth Circuit case which
Fagan adopted, it is clear that the “findings” referenced were merely findings of fact; the full quote
from Fagan makes clear that an agency’s conclusions of law are reviewed by the trial court de
novo, meaning that the trial court would not be limited to the agency’s interpretation:
The trial court was required to review de novo the Commission’s
conclusions of law. The trial court was also required to affirm the Commission’s
findings of fact, and any conclusions resulting therefrom, if supported by
substantial evidence. This is because a reviewing body “may not substitute its
views for those of the [agency], but instead must accept the [agency’s] findings
unless they are contrary to law, irrational, or unsupported by substantial evidence.”
Fagan, 2006 Guam 11 ¶ 11 (alterations in original) (quoting Alcala v. Dir., Office of Workers
Comp. Programs, 141 F.3d 942, 944 (9th Cir. 1998)).
[15] Major Chargualaf also cites to Motor VehicleManufacturers Ass’n of U.S., Inc. v. State
Farm Mutual Automobile Insurance Co., 463 U.S. 29 (1983), for the proposition that “an agency’s
action must be upheld, if at all, on the basis articulated by the agency itself.” Appellant’s Br. at
23 (quoting State Farm, 463 U.S. at 50). However, that case was in the context of agency
rulemaking and rescission of existing rules where delegated by the legislature to the discretion of
the agency, while this matter is closer to administrative adjudication. See City of Arlington, Tex.
v. FCC, 668 F.3d 229, 241 (5th Cir. 2012) (finding that declaratory ruling by FCC establishing
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 9 of 21
what constituted reasonable time period under Telecommunications Act was “result of
adjudication” rather than notice-and-comment rulemaking). The agency action in State Farm was
the rescission of automotive safety regulations, and the post hoc rationalizations upon which the
court could not uphold the agency’s actions were highly fact-driven assertions unsupported by the
record. See State Farm, 463 U.S. 29. Conversely, the basis of GGRF’s decision here has always
been the retirement fund statutes at 4 GCA § 8101 et seq. The trial court’s use of a canon of
statutory interpretation different from that advanced by GGRF to resolve a pure question of law is
a permissible aspect of de novo review. See Albuquerque Bernalillo Cnty. Water Util. Auth. v.
N.M. Pub. Regul. Comm’n, 2010-NMSC-013, ¶ 50, 148 N.M. 21, 229 P.3d 494 (holding that
because statutory construction is not a matter within appellee’s expertise, appellee’s construction
is not entitled to judicial deference).
[16] Similarly, Major Chargualaf cites SEC v. Chenery Corp., 318 U.S. 80 (1943), without
considering the full context of that decision. See Appellant’s Br. at 23 (quoting Chenery Corp.,
318 U.S. at 87). That case did establish the rule that “[t]he grounds upon which an administrative
order must be judged are those upon which the record discloses that its action was based,” but this
only extends to those determinations or actions which the agency alone is authorized to make:
If an order is valid only as a determination of policy or judgment which the agency
alone is authorized to make and which it has not made, a judicial judgment cannot
be made to do service for an administrative judgment. For purposes of affirming
no less than reversing its orders, an appellate court cannot intrude upon the domain
which Congress has exclusively entrusted to an administrative agency.
Chenery Corp., 318 U.S. at 87–88. Here, statutory interpretation of any ambiguities has not been
exclusively entrusted to the discretion of GGRF, and the trial court—and, consequently, this
court—is not limited to the canons of statutory interpretation initially advanced by GGRF.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 10 of 21
3. Plain Language Does Not End Inquiry Because Ambiguities Remain
[17] Statutory interpretation should always begin with the plain language of the statute. Data
Mgmt. Res., LLC v. Office of Pub. Accountability, 2013 Guam 27 ¶ 17; Aguon v. Gutierrez, 2002
Guam 14 ¶ 6. The Superior Court found that the plain language favored Major Chargualaf’s
interpretation because the language of section 8104(i) defining “[a]verage annual salary”
contained “no qualifiers as to amounts that should be excluded, and a plain reading suggests that
any and all amounts received in an annum count.” RA, tab 39 at 8 (Dec. & Order, Aug. 27, 2019).
Nonetheless, the court ultimately found for GGRF because Major Chargualaf’s understanding
would lead to absurd results and frustrate the intent of the legislature. Id. at 7–11; see infra Part
IV.A.4. Major Chargualaf argues that the Superior Court’s determination of the plain language
meaning of 4 GCA §§ 8104 and 8122 is “settled” because it “has not been appealed” by GGRF.
Appellant’s Br. at 9. But issues of statutory interpretation are reviewed de novo, Ada, 1999 Guam
10 ¶ 10, where “no form of appellate deference is acceptable,” Salve Regina Coll. v. Russell, 499
U.S. 225, 238 (1991). Thus, the Superior Court’s legal conclusion on the plain meaning is not
dispositive, and this court may reexamine the issue.
[18] Title 4 GCA § 8122(a) establishes the formula for calculating the basic retirement annuity
payable to members of the Defined Benefit Plan using the employee’s average annual salary and
number of years of credited service,3 while section 8104 defines the essential terms. “Service shall
3
The entire formula is as follows:
(1) an amount equal to two percent (2.0%) of average annual salary for each of the first ten
(10) years of credited service, and two and one-half percent (2.5%) of average annual salary for each
year, or part thereof, of credited service over ten (10) years;
(2) in addition, there shall be added to the amount set forth in Subsection (1) an amount
equal to Twenty Dollars ($20.00) multiplied by each year of credited service, the total of which shall
then be reduced by an amount equal to one hundredth of one percent (.01%) of said total for each
One Dollar ($1.00) that a member’s average annual salary exceeds the amount of Six Thousand
Dollars ($6,000.00);
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 11 of 21
mean actual employment by the Government as an employee for salary or compensation or service
otherwise creditable as herein provided.” 4 GCA § 8104(e). “Salary shall mean the amount
received by an employee for service which shall include allowances for maintenance at the
prescribed rate and any territorial post differential.” Id. § 8104(i). “Average annual salary shall
mean the average of the three (3) highest annual salaries received by a member during his years of
credited service or Six Thousand Dollars ($6,000) whichever is greater.” Id. § 8104(j).
[19] Major Chargualaf urges us to focus on the word “received” within the definition of average
annual salary, Appellant’s Reply Br. at 17–18 (Mar. 11, 2020), while GGRF places the emphasis
on the phrase “during his years of credited service” together with the definition of “service” in
section 8104(e) and the requirement that “not more than one (1) year service shall be creditable on
account of service rendered during any year.” 4 GCA § 8114 (2005); Appellee’s Br. at 6–9 (Feb.
26, 2020). However, both sides neglect to point out the ambiguity raised by the lack of a definition
provided for “annual salary” despite its importance within the definition of “average annual
salary.”
[20] The crux of the issue appears to be the definition of “annual salary” and whether it should
be read as the compensation or “salary” received within one year by an employee or what is earned
within one year. The “received” within the definition of “average annual salary” does not resolve
the issue because it refers to “salaries” received by a member during his or her “years of credited
service,” but not when such credited service must occur in relation to the salaries to which they
are credited. The ordinary meaning of “salary” tends to connote a regular amount to be paid to an
(3) no basic retirement annuity shall exceed eight-five percent (85%) of average annual
salary; and
(4) the basic retirement annuity shall not, in any case, be less than One Thousand Two
Hundred Dollars ($1,200.00) per year per member.
4 GCA § 8122(a) (as amended by Pub. L. 35-036:XI:4 (Sept. 4, 2019).
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 12 of 21
employee in a given period for services performed.4 Thus, contrary to the holding of the Superior
Court, the regular intervals suggested by the ordinary meaning of “salary” seem to support the
interpretation of GGRF that lump-sum payments not attributable to the period in which they are
paid would not constitute “salary” for the year of payment because it would not be part of the
regular agreed compensation. But we cannot simply substitute the ordinary meaning of salary for
that defined by the legislature, even if the statutory definition is more ambiguous than the ordinary
meaning. See Stenberg v. Carhart, 530 U.S. 914, 942 (2000) (“When a statute includes an explicit
definition, we must follow that definition, even if it varies from that term’s ordinary meaning.”).
With the ambiguity of the provided “salary” definition and absent a definition for “annual salary,”
the statute does not yield an unambiguous result, and so this court may turn to other canons of
statutory construction to fill in the gaps.
4. Major Chargualaf’s Interpretation Would Contravene Legislative Intent
[21] “[N]otwithstanding the deference due the plain-meaning of statutory language, . . . such
language need not be followed where the result would lead to absurd or impractical consequences,
untenable distinctions, or unreasonable results.” Sumitomo Constr., Co. v. Gov’t of Guam, 2001
Guam 23 ¶ 17 (quoting Bowlby v. Nelson, Civ. No. 83-0096A, 1985 WL 56583, at *2 (D. Guam
App. Div. Sept. 5, 1985)). “Absurdity may result when the legislature drafts a statute using
language that is broader and more sweeping than that which the legislature intended.” Id. Here,
the statutory definition of “salary” is broader than that in Black’s Law Dictionary and arguably
common understanding because it is defined as the “amount received by an employee for service”
with no reference to a fixed or agreed-upon amount or payments at regular intervals. It would not
4
Black’s Law Dictionary defines “salary” as “[a]n agreed compensation for services—esp. professional or
semiprofessional services—usu. paid at regular intervals on a yearly basis, as distinguished from an hourly basis.”
Salary, Black’s Law Dictionary (11th ed. 2019). Merriam-Webster defines “salary” as “fixed compensation paid
regularly for services.” Salary, Merriam-Webster, https://www.merriam-webster.com/dictionary/salary.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 13 of 21
be unreasonable for the court to interpret the broader language of the definition of “salary” in a
more limited fashion to carry out legislative intent.
[22] Title 4 GCA § 8101 states:
The purpose of the [GGRF] is to provide retirement annuities and other
benefits for the employees of the government of Guam . . . with the objective of
encouraging qualified personnel to enter and remain in the service of the
Government, thus effecting economy and efficiency in the administration of the
Government.
4 GCA § 8101 (2005). GGRF argues that Major Chargualaf’s interpretation would lead to absurd
results because it could cause uneven treatment and differing annuities for members who work the
same job at the same salary for the same amount of time, but who, for one reason or another,
receive their payments at different times. See Appellee’s Br. at 12–13. Major Chargualaf contends
that his own interpretation, although it would lead to outsized annuities for some members, is not
an absurd result because “it does not seem so overwhelmingly absurd to believe that a Guam
Legislator would choose to provide retirement benefit calculations that would earn favor with
members of the retirement fund by increasing the annuity due to them.” Appellant’s Br. at 15.
GGRF counters that the potential impact of the interpretation might increase the annuity for some
members but might decrease the annuity for others depending on the timing of payments.
Appellee’s Br. at 14.
[23] GGRF argues that adopting Major Chargualaf’s interpretation of the statutes would be
“inconsistent with the purposes and polices of the DB plan” to “be able to provide retirement
benefits to all enrolled employees and their families” because it could further exacerbate the
“unfunded actuarial liability” of GGRF through “pension spiking.” Id. at 14–18. But this should
not affect the court’s analysis if doing so would contradict legislative intent and usurp the
legislative function. The prudence of a particular public policy remains for the sound judgment of
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 14 of 21
the legislature. We rely on the plain language of these statutes and the policy considerations
contemplated by the legislature.
[24] The legislature’s stated purpose for the Fund is both to effect “economy and efficiency in
the administration of the Government” and to incentivize qualified employees to enter the service
of the Government by providing for them. 4 GCA § 8101. Although section 8101.1 also reveals
a concern for current excessive levels of benefits compared to other government retirement
systems, the legislature recognized “it may be necessary to maintain current plan benefit levels for
current government employees.” Id. § 8101.1(a). Thus, the only evidence of legislative concern
for the excesses of the DB plan recognizes that it “may be difficult to decrease benefit levels for
current members.” Id. Major Chargualaf was already an existing member when that legislative
concern was adopted, so this court is not persuaded by GGRF’s alarmist tales of other pension
systems that drove localities to bankruptcy when an equally important purpose of motivating
qualified employees is also recognized by the legislature.
[25] Nonetheless, balancing both legislative objectives supports GGRF’s interpretation of 4
GCA § 8101 et seq. Major Chargualaf’s interpretation invites the potential for extreme
disproportion between the annuities awarded to similarly situated employees. As an example, a
Port Authority employee was reinstated by court order and awarded nearly four years’ worth of
full back pay. See Port Auth. of Guam v. Civil Serv. Comm’n (Guevara), No. SP0125-13 (Dec. &
Order, Sept. 26, 2016); id. (Dec. & Order, July 2, 2015), aff’d, 2018 Guam 1. If the salary of those
four years were paid to the employee in a single year and included as a single year in the
computation of “average annual salary,” the employee’s annuity could double under Major
Chargualaf’s interpretation compared to that of a similarly situated employee who was not
wrongfully terminated. Such an unpredictable method of calculating retirement annuities would
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 15 of 21
not meet the stated objective of “encouraging qualified personnel to enter and remain in the service
of the Government,” and disproportionately generous annuities would violate the objective of
economic efficiency. Other sections of the statute show legislative intent to exclude various types
of pay from the annuity calculations. For example, the statute distinguishes “base” and “non-base
pay” and precludes non-base pay, including overtime and bonuses, from the calculation of salary
except for those employees who elected to contribute the required rate to the Fund for non-base
pay before March 29, 1993. See 4 GCA § 8136(c) (2005); RA, tab 11 (Decl. Joshua D. Walsh),
Ex. C (OPA Report No. 16-04, May 2016).
[26] Applying retroactive compensation towards the “salary” of the year in which the
compensation was earned rather than received keeps retirement annuities linked to the actual value
of service rendered by the member during his or her years of employment and the actual income
that supported the employee. This interpretation is consistent with the objective to motivate
employees by providing for them in retirement or other circumstances without increasing the
burden on GGRF’s resources based on the timing of payments.
B. Discovery Was Not Necessary Because No Factual Dispute Existed
[27] Major Chargualaf urges this court to find that the trial court erred in failing to address his
request for discovery in its Decision and Order. Appellant’s Br. at 29–30. Major Chargualaf does
not request a remand with instructions to order discovery in his prayers for relief. See Appellant’s
Br. at 33; Reply Br. at 25. Rather, he asks this court to reverse and direct the trial court to interpret
the statute in his favor and grant the writ of mandate. Id. Major Chargualaf contradicts his own
contention that there are factual disputes not resolved by the record on appeal: either the record is
incomplete, and discovery must be had before a final determination on the merits of his arguments;
or there are no factual disputes, and the remaining questions of law may properly be decided by
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 16 of 21
this court without further development of the record. Even so, we will briefly address the alleged
process errors.
[28] Major Chargualaf contends he sought discovery “to understand how GGRF came to the
conclusion it did in its decision” and ensure it followed the procedures required under Guam’s
Administrative Adjudication Law (“AAL”). Reply Br. at 20; Appellant’s Br. at 30. He points to
a West Virginia case which held that the procedural due process rights of a member of a police
pension fund required retained counsel, depositions, the opportunity to argue the case before the
board, and a written statement outlining reasons for the denial of benefits. Barron v. Bd. of Trs. of
Policemen’s Pension & Relief Fund, 345 S.E.2d 779, 784 (W. Va. 1985). Major Chargualaf
highlights that there was no hearing at the agency level, that GGRF made “specific denials of
factual claims he raised in his initial Petition,”5 and that GGRF asserted that its decision to deny
the request was “supported by substantial evidence.” Appellant’s Br. at 30. Major Chargualaf
also argues that the inclusion of the affidavit of Paula Blas is a proffer of factual evidence he should
be able to test through “the adversarial process or the rigors of discovery.” Id. at 31.
[29] GGRF asserts that “there are no questions of fact at issue in the instant case” and that the
issue of how the Fund’s interpretation of the statute came to be adopted by the Board is “not
relevant to the issue at hand.” Appellee’s Br. at 27–28. GGRF rightly points out that Barron is
distinguishable in several ways from this case. Appellee’s Br. at 26. First, Barron involved a
determination of eligibility for disability benefits, whereas there was no dispute here about Major
Chargualaf’s eligibility for the retirement benefit—merely the amount due. Second, the parties in
Barron disagreed about the extent of the member’s disability—a factual determination—while the
parties here agree to the basic facts surrounding Major Chargualaf’s employment and the nature
5
Major Chargualaf does not identify to which denials he refers, and there does not appear to be any denials
of the amount of or circumstances under which the lump-sum payments were made.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 17 of 21
and amounts of the payments made to him. Finally, GGRF points out that the employee in Barron
was prevented from obtaining and presenting evidence supporting his disability, whereas here the
“record demonstrates the extensive research conducted by the Fund before issuing its decision.”
Appellee’s Br. at 26. GGRF also highlights that Major Chargualaf’s opening brief argued that the
affidavit submitted is “of no consequence, since Paula Blas is not the Retirement Fund.”
Appellee’s Br. at 27; Appellant’s Br. at 31.
[30] The record is undeveloped insofar as it is unclear by what process GGRF arrived at its own
interpretation of the statute and denied the petition. Yet because we review de novo the merits of
the statutory interpretation, an analysis of GGRF’s own process of interpretation is unnecessary to
the disposition of this case.
[31] There is no factual dispute, and the primary remaining question is a matter of law. Guam
Rule of Civil Procedure 26(a)(1)(E)(xx) provides that proceedings for writs are exempt from initial
discovery requirements “unless otherwise ordered by the court.” Rule 26(b)(1) provides that the
scope of discovery includes “any matter, not privileged, that is relevant to the claim or defense of
any party,” but Rule 26(b)(2) provides that the use of discovery “shall be limited by the court if it
determines that: . . . (iii) the burden or expense of the proposed discovery outweighs its likely
benefit.” Other than vague references to GGRF’s process, Major Chargualaf does not identify
what particular evidence he would request if granted the opportunity. See Reply Br. at 23–24. At
the hearing, Major Chargualaf requested discovery “to show actually how the Fund has done these
calculations in the past, [because] it would be useful for the Court to actually weigh the veracity
of the legal contentions of ‘This is how we’ve always done it.’” Transcripts (“Tr.”) at 4
(Scheduling Conf., June 26, 2018). If allowed, this could involve extensive discovery of the
confidential personnel files of hundreds of Government of Guam employees who are otherwise
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 18 of 21
not connected to this case. The burden would be substantial, and its likely benefit minimal, given
our authority to review the statutory interpretation de novo and our primary concern of legislative
intent.
[32] We do not remand and order discovery because Major Chargualaf did not request discovery
in his prayers for relief, the primary facts are not disputed, the process by which GGRF adopted
its interpretation is only minimally relevant, and allowing discovery on previous GGRF
calculations would be unduly burdensome compared to any benefit.
C. Major Chargualaf’s Due Process Rights Were Not Violated When GGRF Issued Its
Determination on His Petition for a Declaratory Ruling without Holding a Hearing
[33] Finally, Major Chargualaf asserts that his due process rights were violated by the lack of a
hearing at the agency level. Appellant’s Br. at 3. However, this is not a traditional administrative
due process case where the challenged agency decision involves a challenged factual
determination along with a legal interpretation. The cases cited by Major Chargualaf all involved
disputed facts decided upon by the agency, while the parties here agree to the essential facts of
Major Chargualaf’s employment status, eventual eligibility for retirement benefits under the DB
Plan, the payment he received, and the nature of those payments as retroactive compensation. The
only remaining question about the amount of Major Chargualaf’s retirement benefits was a matter
of law.
[34] GGRF does not contest that it is subject to Guam’s AAL codified in Title 5, Chapter 9 of
the Guam Code Annotated, but the procedure of 5 GCA § 9200 et seq. applies only when the “legal
rights, duties or privileges of specific parties are required by law to be determined after an agency
hearing.” 5 GCA § 9200 (2005); see also Perez, 2005 Guam 25 ¶ 36. Major Chargualaf states,
“That body of law contemplates the holding of a hearing before the determination by the
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 19 of 21
Retirement fund of Major Chargualaf’s rights,” but he does not identify where under law GGRF
declaratory rulings must be made only after an agency hearing. See Appellant’s Br. at 25.
[35] Major Chargualaf contends that the Superior Court erred in relying on the fact that 2 GAR
§ 3101(5), which governs declaratory rulings by GGRF, does not require a hearing because it
ignored “the great weight of authority that requires a hearing and notice when vested property
rights, such as pension benefits, are at stake.” Appellant’s Br. at 26. Major Chargualaf appears to
argue that Title 2, Chapter 9 of the Guam Administrative Rules and Regulations is unconstitutional
because it does not require a hearing before GGRF may issue a declaratory ruling. However, the
property right of Major Chargualaf to his retirement benefits has never been in controversy, merely
the proper interpretation of an ambiguity in the calculation of that benefit. As GGRF frames it,
there was no risk of a deprivation of property, and he had no right to due process protections
because “Mr. Chargualaf has not demonstrated any legal claim to his proffered calculation,” which
should not be conflated with a “vested pension.” Appellee’s Br. at 21–22.
[36] Even if the difference in calculated benefits under the disputed interpretations amounted to
a vested property interest, due process does not always require an extensive hearing even when
property rights are in jeopardy. “The base requirement of the Due Process Clause is that a person
deprived of property be given an opportunity to be heard ‘at a meaningful time and in a meaningful
manner.’” Buckingham v. Sec’y of U.S. Dep’t of Agric., 603 F.3d 1073, 1082 (9th Cir. 2010)
(quoting Brewster v. Bd. of Educ. of Lynwood Unified Sch. Dist., 149 F.3d 971, 984 (9th Cir.
1988)). In Carlson v. Perez, 2007 Guam 6 ¶¶ 35–37, we adopted the standards established by the
U.S. Supreme Court in Mathews v. Eldridge, 424 U.S. 319 (1976), that “resolution of the issue
whether the administrative procedures provided . . . are constitutionally sufficient requires analysis
of the governmental and private interests that are affected.” Mathews, 424 U.S. at 334. When
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 20 of 21
determining whether due process has been afforded through the administrative process, courts
must consider (1) the private interest affected; (2) the risk of erroneous deprivation of such interest
through the recognized procedures, and the probable value of any additional or substitute
procedural safeguards; and (3) the government’s interest, including the function involved and any
burdens that additional or substitute requirements would entail. Id. at 335.
[37] Here, Major Chargualaf had a full opportunity through his petition for a declaratory ruling
to submit his legal arguments before GGRF as to why his interpretation should prevail. Because
no essential facts were at issue, an evidentiary hearing would not have provided any additional
information necessary to resolve the pure question of law, and therefore would have provided no
additional safeguard to any property interest. Further, 2 GAR § 3101(5)(d) provided an additional
procedural safeguard permitting Major Chargualaf to appeal the decision of GGRF to the Superior
Court, a right of which he availed himself. Major Chargualaf received a meaningful opportunity
to be heard both through the Verified Petition for a Declaratory Ruling before GGRF and the
Verified Petition for a Writ of Mandate before the Superior Court, and his due process rights were
not violated.
[38] GGRF was required by 2 GAR § 3101(5)(d) to decide the Petition for Declaratory Ruling
within 90 days but failed to issue its decision until 252 days after receiving Major Chargualaf’s
petition. See RA, tab 39 at 4 (Dec. & Order, Aug. 27, 2019); Appellant’s Br. at 25. GGRF
attributed part of the delay to Major Chargualaf’s failure to provide detailed payroll information
in his petition and the subsequent need for GGRF to work with the Guam Department of
Administration to obtain the necessary records. Appellee’s Br. at 24–25. No actual prejudice
resulted from the delay because Major Chargualaf has yet to retire and begin receiving benefits,
and his right to appeal was not hindered by the delay. See RA, tab 39 at 5 (Dec. & Order, Aug.
Chargualaf v. Gov’t of Guam Ret. Fund, 2021 Guam 17, Opinion Page 21 of 21
27, 2019). Although GGRF’s decision exceeded the 90-day limit for a response, Major
Chargualaf’s due process rights were not violated because there was an explanation for the delay
and because no actual prejudice resulted.
V. CONCLUSION
[39] The trial court did not err because (1) GGRF’s interpretation of Title 4, Chapter 8 of the
Guam Code Annotated is consistent with legislative intent, (2) discovery was unnecessary at the
trial court level, and (3) Major Chargualaf was not deprived of due process when GGRF followed
the administrative procedures of 2 GAR § 3101. Therefore, we AFFIRM the denial of the petition
for a writ of mandate.
/s/ /s/
ROBERT J. TORRES ALEXANDRO C. CASTRO
Associate Justice Justice Pro Tempore
/s/
F. PHILIP CARBULLIDO
Chief Justice