Richard W. Berg v. Hon. Christopher J. Christie(074612) , 225 N.J. 245 ( 2016 )

SYLLABUS
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the
convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the
interest of brevity, portions of any opinion may not have been summarized.)
Richard W. Berg v. Hon. Christopher J. Christie (A-71/72-14) (074612)
Argued March 14, 2016 – Decided June 9, 2016
LaVECCHIA, J., writing for a majority of the Court.
In this appeal, the Court considers whether the 2011 suspension of State pension cost-of-living adjustments
(COLAs), L. 2011, c. 78, contravened a term of the contract right granted under the earlier enacted “non-forfeitable
right” statute, L. 1997, c. 113 (presently codified as N.J.S.A. 43:3C-9.5).
The Pension Adjustment Act (PAA) started the modern legislative provision of COLAs for public sector
retirees. The PAA’s initial reach was limited, granting adjustments only to those who retired before 1952, among
other restrictions. COLAs were subject to annual appropriation by the Legislature and thus funded on a pay-as-you-
go basis. As the cost of living rose, retirees who retired after 1952 watched their fixed incomes drop in real terms.
The Legislature responded in the 1960s with a series of amendments to the COLA formula, culminating in 1969,
when the Legislature expanded COLAs to cover all eligible retirees, and linked the COLA formula to the consumer
price index (CPI). Over time, the Legislature took a series of steps to shift COLAs to a prefunded basis, recognizing
that the pay-as-you-go funding scheme was fiscally untenable.
In 1997, the Legislature enacted the non-forfeitable-right statute. L. 1997, c. 113, § 5 (Chapter 113). Then,
in 2011, as a part of comprehensive pension reform legislation, Chapter 78 suspended further COLAs, freezing the
cost-of-living adjustment at the 2011 level for current and future qualifying retirees. L. 2011, c. 78, § 25. The
suspension of State pension COLAs led to the complaint that commenced this action.
Retired government employees filed a complaint against various State defendants, alleging that plaintiffs
had contractual, statutory, and constitutional rights to COLAs and seeking numerous forms of relief. A group of
state and local employees and their labor unions (Intervenors) were granted leave to intervene and file a complant.
On the State’s motion, the trial court dismissed the two actions in their entirety. The court found Chapter 78 to be
constitutional without examining or resolving the non-forfeitable-right statute. The court viewed the Debt
Limitation Clause and the Appropriations Clause of the New Jersey Constitution as, in and of themselves, reserving
to the Legislature the ability to make changes to the pension statutes.
Plaintiffs and Intervenors filed separate notices of appeal, which the Appellate Division consolidated. In a
published opinion, the Appellate Division reversed the trial court’s dismissal of the complaints, concluding that
Chapter 113 created a protectable contract right that included COLAs. 436 N.J. Super. 220 (App. Div. 2014). The
panel remanded for a contract-impairment analysis, which the trial court had not reached. The panel rejected
plaintiffs’ other arguments and found that certain of their claims were properly dismissed.
Plaintiff Charles Ouslander, a retired prosecutor, filed a petition for certification, and the State filed a cross-
petition from the Appellate Division’s judgment. The Court granted both applications. 222 N.J. 311 (2015).
HELD: To construe a statute as creating a contractual right, the Legislature’s intent to limit the subsequent exercise
of legislative power must be clearly and unequivocally expressed concerning both the creation of a contract as well
as the terms of the contractual obligation. In this instance, proof of unequivocal intent to create a non-forfeitable
right to yet-unreceived COLAs is lacking. The Legislature retained its inherent sovereign right to act in its best
judgment of the public interest and to pass legislation suspending further COLAs.
1. The question before the Court is whether there is a contractual right to continued increased adjustment of public
pension benefits. To find a contract created by statute means that the Legislature binds itself to a policy choice and
surrenders the power of future elected representatives to cut back on that choice. Because the effect of finding a
1
statutory contract is so severe, only the clearest expression of statutory language and evidence of legislative intent
for such creation will do. In Spina v. Consolidated Police and Firemen’s Fund Commission, 41 N.J. 391 (1964), the
Court explained that a contractual restriction on future legislative action “should be so plainly expressed that one
cannot doubt the individual legislator understood and intended it.” That standard has remained the benchmark in
New Jersey for determining whether a contract has been created by statute. See Burgos v. State, 222 N.J. 175, 195
(2015), cert. denied, 136 S. Ct. 1156 (2016). State and federal courts across the country also have applied their
variants of the “clear indication” standard in cases like this one -- legislative suspension or reduction of COLAs. In
sum, courts historically have adhered to the clear indication standard, and it applies in this appeal. (pp. 18-25)
2. With the standard established, the Court turns to the statutes at issue in this appeal, beginning with a close
examination of the non-forfeitable-right statute, L. 1997, c. 113, § 5. Using the Public Employees’ Retirement
System as an example, the Court examines the statutes of the individual retirement systems or funds to understand
the benefits purportedly provided non-forfeitable protection. The relevant statutes define each system or fund as the
means for providing the retirement allowance and other benefits under the provisions of that system’s enabling act;
they do not include reference to benefits authorized to be paid via other statutes or acts. Because the individual
systems and funds define benefits as those made available only pursuant to their respective acts, the State urges the
Court to find that COLAs are not part of the protected non-forfeitable right. The State notes that COLAs are not
provided through the enabling acts or laws governing the specific retirement systems or funds, but rather are
authorized and are provided by way of separate legislation -- the Pension Adjustment Act, N.J.S.A. 43:3B-1 to -10.
Contrarily, plaintiffs argue that by using the term “benefits program” in the non-forfeitable-right statute, the
Legislature melded the base pension benefit to the COLA. Because the Legislature specifically excluded medical
benefits from the non-forfeitable right but did not exclude COLAs, plaintiffs think it unmistakable that COLAs fall
under the umbrella of the benefits program. (pp. 25-35)
3. This is not an ordinary statutory interpretation case. The Court’s task is not to determine which textually based
argument is more likely than not the actual intent of the Legislature. Rather, to find a statutory contract that would
have the effect of restricting subsequent legislative action on the subject, the Court must find unmistakable evidence
of legislative intent to create a non-forfeitable right to COLAs. Fairly viewed, the parties’ many arguments are
reasonable. However, based on the substantive provisions of the retirement systems’ or funds’ laws referenced in
the non-forfeitable-right statute, which detail the benefits receiving protection, and the absence of COLAs from
those provisions, plaintiffs’ arguments are insufficient. The plain language of the non-forfeitable-right statute does
not surely embrace COLAS, as it must to satisfy Spina. To succeed, plaintiffs needed to demonstrate that the
legislative intent to render future COLAs part of the non-forfeitable right conferred by Chapter 113 was
unmistakable. From a textual standpoint, that high standard simply is not met here. (pp. 36-37)
4. Plaintiffs argue that legislative history reveals the unmistakable legislative intent to include COLAs under the
protection of the non-forfeitable-right statute. But if there is ambiguity requiring resort to legislative history, one is
already outside the realm of unmistakable clarity needed to find a statutory contract right. In this setting, any
ambiguity spells failure for claims that the Legislature created a contractual right to COLAs. Even if the Court were
to look at legislative history, evidence of such unmistakable intent is wanting there. Plaintiffs also contend that the
history of COLAs supports the reasonable expectation that they were part and parcel of the singular pension benefit
provided on a monthly basis to retirees or their beneficiaries. However, the history of COLAs in New Jersey shows
that the Legislature granted COLAs as periodic exercises of legislative discretion separate and apart from the base
pension. Therefore, the additional extrinsic evidence offered by plaintiffs does not further the argument that the
Legislature acted with the required intent to include COLAs under the non-forfeitable-right statute. (pp. 38-46)
5. Finally, the Court rejects the alternative argument, raised by petitioner Ouslander, that equity prevents the State
from terminating COLAs for those employees who retired prior to the enactment of Chapter 78. Because the
language of the non-forfeitable-right statute does not guarantee COLAs, it necessarily follows that the retirees could
not reasonably rely on the statute’s terms for purposes of a claim in equity. Petitioner’s due process claims are
unavailing for similar reasons. Those claims depend on the existence of a vested right; the continued receipt of
COLAs cannot be categorized in that way based on the current text of the non-forfeitable-right statute. (pp. 46-49)
The judgment of the Appellate Division is REVERSED, and the trial court’s judgment dismissing the
complaints is REINSTATED.
2
JUSTICE ALBIN, DISSENTING, expresses the view that the pension statutes at issue are clear and
unambiguous, and guarantee COLAs for retired public employees. Justice Albin believes that, because the cost-of-
living adjustment was contained in laws “governing the retirement system or fund” and not subject to any exclusion
in the non-forfeitable-right statute, plaintiffs are entitled to COLAs as a part of their full pension benefits.
CHIEF JUSTICE RABNER; JUSTICES PATTERSON, FERNANDEZ-VINA, and SOLOMON;
and JUDGE CUFF (temporarily assigned), join in JUSTICE LaVECCHIA’s opinion. JUSTICE ALBIN filed
a separate, dissenting opinion.
3
SUPREME COURT OF NEW JERSEY
A-71/72 September Term 2014
074612
RICHARD W. BERG, ROBERT J.
BRASS, THOMAS CANNAVO,
MELAINE B. CAMPBELL, LARRY
ROBERT ETZWEILER, KATHY
FLICKER, ARNOLD GOLDEN,
CHARLES GRINELL, TONI A.
HENDRICKSEN, HAROLD
KASSELMAN, SUSAN LOTHIAN,
STEPHEN H. MONSON, MARTIN C.
MOONEY, SR., BRIAN
MULHOLLAND, ANNE C. PASKOW,
SHARYN PEIFFER, SAMUEL REAL,
JR., GREGORY J. SAKOWICZ,
SUSAN W. SCIACCA, WILLIAM H.
SCHMIDT, FRED SCHWANWEDE,
JOHN J. SMITH, DEBRA STONE,
SHERI TANNE, AND JACK L.
WEINBERG,
Plaintiffs-Respondents,
and
CHARLES OUSLANDER,
Plaintiff-Appellant
and Cross-Respondent,
and
NEW JERSEY EDUCATION
ASSOCIATION, NEW JERSEY STATE
POLICEMEN’S BENEVOLENT
ASSOCIATION, INC.,
COMMUNICATIONS WORKERS OF
AMERICA, AFL-CIO, NEW JERSEY
FRATERNAL ORDER OF POLICE,
NEW JERSEY STATE
1
FIREFIGHTERS’ MUTUAL
BENEVOLENT ASSOCIATION,
PROFESSIONAL FIREFIGHTERS
ASSOCIATION OF NEW JERSEY,
AMERICAN FEDERATION OF STATE,
COUNTY AND MUNICIPAL
EMPLOYEES, COUNCIL 1, AFL-
CIO, AMERICAN FEDERATION OF
STATE, COUNTY AND MUNICIPAL
EMPLOYEES, COUNCIL 73, AFL-
CIO, AMERICAN FEDERATION OF
TEACHERS NEW JERSEY STATE
FEDERATION, AFL-CIO,
INTERNATIONAL FEDERATION OF
PROFESSIONAL AND TECHNICAL
ENGINEERS, AFL-CIO & CLC,
LOCAL 194, INTERNATIONAL
FEDERATION OF PROFESSIONAL
AND TECHNICAL ENGINEERS, AFL-
CIO, LOCAL 195, INTERNATIONAL
FEDERATION OF PROFESSIONAL
AND TECHNICAL ENGINEERS, AFL-
CIO & CLC, LOCAL 200,
PROBATION ASSOCIATION OF NEW
JERSEY, NEWARK FIREFIGHTERS
UNION, MORRIS COUNCIL NOS. 6
AND 6A, NJCSA IFPTE, AFL-CIO,
JERSEY CITY POLICE OFFICERS
BENEVOLENT ASSOCIATION,
CAMDEN COUNTY COUNCIL #10,
INTERNATIONAL BROTHERHOOD OF
TEAMSTERS LOCAL 97,
BELLEVILLE PBA LOCAL 28, NEW
JERSEY ASSOCIATION OF SCHOOL
ADMINISTRATORS, NEW JERSEY
PRINCIPALS AND SUPERVISORS
ASSOCIATION, NEW JERSEY
ASSOCIATION OF SCHOOL
BUSINESS OFFICIALS, NEW
JERSEY RETIREES’ EDUCATION
ASSOCIATION, TRANSPORT
WORKERS UNION LOCAL 225, NEW
JERSEY SUPERIOR OFFICERS LAW
ENFORCEMENT ASSOCIATION,
2
ATLANTIC CITY WHITE COLLAR
PROFESSIONAL ASSOCIATION,
INTERNATIONAL BROTHERHOOD OF
ELECTRICAL WORKERS LOCAL 210,
ATLANTIC CITY SUPERIOR
OFFICERS ASSOCIATION, PETER
BURKHALTER, DEE TRUCHON,
GEORGE O’BRIEN, THOMAS
TEVLIN, ROBERT BROWER,
ROSEMARIE JANKOWSKI, IRIS J.
ELLIOTT, KENNETH D. KING,
FRANK ELMER HICKS, WILLIAM A.
PARKER, BRAD FAIRCHILD,
DWIGHT COVALESKIE, ANTHONY F.
WIENERS, GARY SOUSS, WILLIAM
LAVIN, CHARLES WEST, MARIAN
LEZGUS, MELANIE HAFDELIN,
STEVEN ENGRAVALLE, CINDY
BARR-RAGUE, DOMINICK MARINO,
JOHN J. GEROW, JANET S.
ZYNROZ, ALFRED CRESCI, RAE C.
ROEDER, MARYANN PIUNNO SMITH,
MARYANN MESICS, DENNIS
REITER, ANTHONY MISKOWSKI,
VINCENT KAIGHN, WILLIAM S.
BAUER, JR., MICHAEL
CALABRESE, and DEBORAH
JACOBS,
Plaintiffs/Intervenors-
Respondents,
v.
HON. CHRISTOPHER J. CHRISTIE,
HON. KIM GUADAGNO, SECRETARY
OF STATE OF THE STATE OF NEW
JERSEY, DIRECTOR, DIVISION OF
PENSIONS, BOARD OF TRUSTEES,
PUBLIC EMPLOYEES’ RETIREMENT
SYSTEM, TREASURER, STATE OF
NEW JERSEY AND STATE OF NEW
JERSEY,
3
Defendants-Respondents
and Cross-Appellants.
MICHAEL DELUCIA, PATRICIA
DELUCIA, ROBERT C. BROWN, AND
ANNE K. BROWN,
Plaintiffs,
v.
STATE OF NEW JERSEY
DEPARTMENT OF THE TREASURY,
DIVISION OF PENSIONS AND
BENEFITS,
Defendants.
Argued March 14, 2016 – Decided June 9, 2016
On certification to the Superior Court,
Appellate Division, whose opinion is
reported at 436 N.J. Super. 220 (App. Div.
2014).
Jean P. Reilly, Assistant Attorney General,
argued the cause for respondents and cross-
appellants (Robert Lougy, Acting Attorney
General of New Jersey, attorney; Mr. Lougy,
Ms. Reilly, and Kevin R. Jespersen,
Assistant Attorney General, of counsel; Ms.
Reilly, John P. Bender, Assistant Attorney
General, Amy Chung, David M. Reap, and
Matthew T. Kelly, Deputy Attorneys General,
on the briefs).
Charles M. Ouslander argued the cause for
appellant and cross-respondent pro se.
Daniel Louis Grossman argued the cause
for respondents Richard W. Berg, Robert
J. Brass, Thomas Cannavo, Melaine B.
4
Campbell, Larry Robert Etzweiler, Kathy
Flicker, Arnold Golden, Charles Grinell,
Toni A. Hendricksen, Harold Kasselman,
Susan Lothian, Stephen H. Monson, Martin
C. Mooney, Sr., Brian Mulholland, Anne C.
Paskow, Sharyn Peiffer, Samuel Real, Jr.,
Gregory J. Sakowicz, Susan W. Sciacca,
William H. Schmidt, Fred Schwanwede, John
J. Smith, Debra Stone, Sheri Tanne, and
Jack L. Weinberg.
Ira W. Mintz argued the cause for
respondents (Weissman & Mintz, attorneys
for Communications Workers of America,
AFL-CIO, American Federation of State,
County and Municipal Employees, Council
73, AFL-CIO, International Federation of
Professional and Technical Engineers,
AFL-CIO & CLC, Local 194, International
Federation of Professional and Technical
Engineers, AFL-CIO & CLC, Local 200,
Peter Burkhalter, Dee Truchon, Rae C.
Roeder, Maryann Piunno Smith, Maryann
Mesics, Dennis Reiter, Anthony
Miskowski, Vincent Kaighn, William S.
Bauer, Jr., Michael Calabrese, and
Deborah Jacobs; Zazzali, Fagella, Nowak,
Kleinbaum & Friedman, attorneys for New
Jersey Education Association, New Jersey
Retirees’ Education Association, New
Jersey State Policemen’s Benevolent
Association, Inc., American Federation
of State, County and Municipal
Employees, Council 1, AFL-CIO,
Belleville PBA Local 28, George O’Brien,
Rosemarie Jankowski, Iris J. Elliot,
William A. Parker, Anthony F. Wieners,
Gary Souss, Marian Lezgus, and Melanie
Hafdelin; Markowitz and Richman,
attorneys for New Jersey Fraternal Order
of Police; Craig S. Gumpel, attorney for
New Jersey State Firefighters’ Mutual
Benevolent Association of New Jersey,
Newark Firefighters Union, Morris
5
Council Nos. 6 and 6A, NJCSA, IFPTE,
AFL-CIO, Thomas Tevlin, Robert Brower,
William Lavin, and Charles West; Mets
Schiro & McGovern, attorneys for
Professional Firefighters Association of
New Jersey, American Federation of
Teachers New Jersey Federation, AFL-CIO,
International Brotherhood of Teamsters
Local 97, Dominick Marino, and John J.
Gerow, Oxfeld Cohen, attorneys for
International Federation of
Professional and Technical Engineers,
AFL-CIO & CLC, Local 195; Spear
Wilderman, attorneys for Camden County
Council #10; Robert M. Schwartz,
attorney for New Jersey Principals and
Supervisors Association, Janet S.
Zynroz, and Alfred Cresci; O’Brien,
Belland & Bushinsky, attorneys for
Transport Workers Union Local 225, New
Jersey Superior Officers Law Enforcement
Association, Atlantic City White Collar
Professional Association, International
Brotherhood of Electrical Workers Local
210, and Atlantic City Superior Officers
Association; Maria M. Lepore, attorney
for New Jersey Association of School
Administrators, Kenneth D. King, and
Steven Engravalle; Sciarrillo, Cornell,
Merlino, McKeever & Osborne, attorneys
for New Jersey Association of School
Business Officials, Frank Elmer Hicks,
and Cindy Barr-Rague; Daniel J. Zirrith,
attorney for Probation Association of
New Jersey and Dwight Covaleskie; Detzky
and Hunter, attorneys for Jersey City
Police Officers Benevolent Association;
Mr. Mintz, Kenneth I. Nowak, Edward M.
Suarez, Jr., and Flavio L. Komuves, on
the joint briefs).
Anthony M. Rainone submitted a brief on
behalf of amicus curiae Former New
Jersey State Troopers Association, Inc.
6
(Brach Eichler, attorneys; Mr. Rainone
and Lucas A. Markowitz, on the brief).
JUSTICE LaVECCHIA delivered the opinion of the Court.
Part of comprehensive pension reform legislation, Chapter
78 of the Laws of 2011 suspended State pension cost-of-living
adjustments (COLAs). L. 2011, c. 78. In this appeal, we
consider whether that suspension contravened a term of the
contract right granted under the earlier enacted “non-
forfeitable right” statute. See L. 1997, c. 113 (presently
codified as N.J.S.A. 43:3C-9.5).
Qualifying members of the State’s public pension systems or
funds were granted “a non-forfeitable right to receive benefits
as provided under the laws governing the retirement system or
fund.” N.J.S.A. 43:3C-9.5(b). By codifying that “non-
forfeitable right to receive benefits,” the Legislature provided
that the “benefits program, for any employee for whom the right
has attached, cannot be reduced.” N.J.S.A. 43:3C-9.5(a). That
legislative enactment underscored the view that a public
employee’s pension -- a benefit accrued through many years of
faithful public service -- represented earned compensation, not
a gratuity that would be revoked or reduced without cause. See
N.J. Educ. Ass’n v. State, 412 N.J. Super. 192, 216 (App. Div.),
certif. denied, 202 N.J. 347 (2010); see also Uricoli v. Bd. of
Trs., Police & Firemen’s Ret. Sys., 91 N.J. 62, 73 (1982)
7
(recognizing that “[p]ublic pensions provide public employees
with employment stability and financial security”).
Whether COLAs are part of the “benefits program” protected
by N.J.S.A. 43:3C-9.5 depends on whether the Legislature, in
enacting N.J.S.A. 43:3C-9.5(a) and (b), intended to create a
contractual right to COLAs. To construe a statute as creating a
contractual right, the Legislature’s intent to limit the
subsequent exercise of legislative power must be clearly and
unequivocally expressed concerning both the creation of a
contract as well as the terms of the contractual obligation.
In this instance, proof of unequivocal intent to create a
non-forfeitable right to yet-unreceived COLAs is lacking.
Although both plaintiff retirees and the State advance plausible
arguments on that question, the lack of such unmistakable
legislative intent dooms plaintiffs’ position. We conclude that
the Legislature retained its inherent sovereign right to act in
its best judgment of the public interest and to pass legislation
suspending further COLAs. Having determined that there is no
contract violation, and because the additional arguments
advanced by plaintiffs are not meritorious, we must respect the
legislative choice and reverse the Appellate Division’s
judgment.
I.
8
Because “[t]he legal issues must be viewed realistically
against the story of these pension plans,” Berg v. Christie, 436
N.J. Super. 220, 229 (App. Div. 2014) (quoting Spina v. Consol.
Police & Firemen’s Pension Fund Comm’n, 41 N.J. 391, 393
(1964)), the Appellate Division’s opinion set forth a necessary
and comprehensive account of the structure of the pension funds,
the Pension Adjustment Act, and the non-forfeitable-right
statute, see id. at 230-43. We need not repeat that thorough
compilation here. For purposes of commencing our review, we
summarize the legislative activity that led up to the issue at
the heart of this appeal: whether the non-forfeitable right to
receive benefits covers COLAs.
The Pension Adjustment Act (PAA), L. 1958, c. 143, started
the modern legislative provision of COLAs for public sector
retirees. The Legislature took that action to meet the
financial need of retirees because, by the late 1950s, many
former public employees -- “retired on pensions based on the
salary levels of many years ago” -- faced financial hardship as
they watched the purchasing power of their pensions diminish
over the years. Sponsor’s Statement to Assembly No. 367 (1958).
But the PAA’s initial reach was limited, granting adjustments
only to those who retired before 1952 and only to the first $480
of a retiree’s pension. L. 1958, c. 143, §§ 2, 3. COLAs were
9
subject to annual appropriation by the Legislature and thus
funded on a pay-as-you-go basis. L. 1958, c. 143, §5.
As the cost of living continued to rise, and retirees who
retired after 1952 watched their fixed incomes drop in real
terms, the Legislature again responded to economic conditions.
See L. 1961, c. 144; L. 1964, c. 198; see also Sponsor’s
Statement to Assembly No. 559 (1961). More retirees were
brought into the fold, and the amount of the pension benefit
subject to COLAs increased, when the COLA formula was amended in
1961 and again in 1964. See L. 1961, c. 144, §§ 1, 2; L. 1964,
c. 198, § 1.
A major change came in 1969, when COLAs were expanded to
cover all eligible retirees. See L. 1969, c. 169, §§ 1, 2.
Moreover, the Legislature linked the COLA formula to the
consumer price index (CPI). L. 1969, c. 169, §§ 1, 5.
With all retirees receiving COLAs, and with COLAs tied to
the consumer price index, the annual appropriation needed to
cover that cost gradually increased in turn. In a series of
legislative steps, COLAs for the pension funds shifted to a
prefunded basis. See L. 1987, c. 385, § 2 (Teachers’ Pension
and Annuity Fund (TPAF)); L. 1989, c. 204, § 7 (Police and
Firemen’s Retirement System (PFRS)); L. 1990, c. 6, § 2 (Public
Employees’ Retirement System (PERS)); L. 1992, c. 41, § 10
(Judicial Retirement System (JRS)); L. 1992, c. 41, § 30 (State
10
Police Retirement System (SPRS)). The Legislature took those
steps in recognition that the pay-as-you-go funding scheme was
proving fiscally untenable. See Sponsor’s Statement to S. No.
665 (1990) (recognizing that state employer’s liability for
COLAs was “growing rapidly” and that “[i]f steps are not taken
soon to recognize and provide reserve funding for this
liability, a severe fiscal crisis could develop in the future”).
COLAs are presently paid by the five major retirement systems,
“funded as employer obligations in a similar manner to that
provided for the funding of employer obligations for the
retirement benefits provided by the retirement system.” See,
e.g., L. 1990, c. 6, § 2 (PERS). Two funds -- the Prison
Officers’ Pension Fund and the Consolidated Police and Firemen’s
Pension Fund -- remain funded on a pay-as-you-go basis. See
N.J.S.A. 43:3B-4a (exempting TPAF from pay-as-you-go funding
method); N.J.S.A. 43:3B-4.2 (exempting PFRS); N.J.S.A. 43:3B-4.3
(exempting PERS); N.J.S.A. 43:3B-4.4 (exempting JRS); N.J.S.A.
43:3B-4.5 (exempting SPRS).
In 1997, the Legislature enacted the non-forfeitable-right
statute. L. 1997, c. 113, § 5 (Chapter 113). Then, in 2011,
Chapter 78 suspended further COLAs, freezing the cost-of-living
adjustment at the 2011 level for current and future qualifying
retirees. L. 2011, c. 78, § 25. That brings us to the
complaint that commenced this action.
11
II.
Richard Berg and twenty-five other retired government
employees1 filed a complaint against the Governor, the Secretary
of State, the Director of the Division of Pensions, the PERS
Board of Trustees, the State Treasurer, and the State
(collectively the State). The complaint alleged that plaintiffs
had contractual, statutory, and constitutional rights to COLAs
and sought numerous forms of relief, including “a mandatory
injunction ordering defendants to pay plaintiffs the COLAs that
were abrogated by” Chapter 78 and “monetary damages equal to the
COLAs that were abrogated by” Chapter 78. Plaintiffs’ complaint
alleged that Chapter 78’s freeze of COLAs constituted a breach
of contract and violated the Contract and Due Process Clauses of
the Federal and State Constitutions.
The State filed a motion to dismiss for failure to state a
claim, and plaintiffs filed a motion for summary judgment.
Prior to the resolution of those motions, a group of state and
local employees, both active and retired, and labor unions that
represent them (Intervenors) filed a motion to intervene, which
the trial court granted. Intervenors thereafter filed a
complaint, adding claimed violations of the Contract Clause and
Due Process as well as equitable estoppel.
1 Per joint stipulation, it is undisputed that all of these
plaintiffs retired prior to 2011.
12
The trial court converted the State’s motion to dismiss
into a motion for summary judgment and granted the State’s
motion, dismissing the two actions in their entirety. The court
found Chapter 78 to be constitutional without examining or
resolving the non-forfeitable-right statute. The court viewed
the Debt Limitation Clause and the Appropriations Clause of the
New Jersey Constitution as, in and of themselves, reserving to
the Legislature the ability to make changes to the pension
statutes. See N.J. Const., art. VIII, § II, ¶ 3; N.J. Const.,
art. VIII, § II, ¶ 2.
Plaintiffs and Intervenors filed separate notices of
appeal, which the Appellate Division consolidated.2 In a
published opinion, the Appellate Division reversed the trial
court’s dismissal of the complaints. Berg, supra, 436 N.J.
Super. at 229. At bottom, the panel concluded that Chapter 113
created a protectable contract right that included COLAs. Id.
at 259.
In reaching its conclusion, the panel noted initially that
there was a tension between, on the one hand, the principle of
statutory construction that pension statutes are remedial
legislation and, on the other, well-recognized case law
2 Retired prosecutor Charles Ouslander filed a notice that he was
proceeding pro se. Where necessary, his arguments are
separately identified.
13
expressing judicial hesitancy to find a contract created by a
statute. Id. at 250. However, the panel concluded that the
non-forfeitable-right statute created a protectable contractual
right that included COLAs. Id. at 259. The panel examined (1)
the text of Chapter 113, which expressly excluded medical
benefits from the definition of the non-forfeitable right but
did not mention COLAs in that express exception, id. at 249; (2)
two forms of legislative history, (a) a transcript from a
legislative hearing that preceded enactment of Chapter 113, and
(b) a Sponsor’s Statement that tracked the bill’s language
specifically excluding medical benefits, id. at 251-253; and (3)
a compiled history of New Jersey’s COLA statutes, which the
panel regarded as having the effect of rendering COLAs an
integral part of the pension benefit, id. at 255-56.
Having determined that the non-forfeitable-right statute
created a contractual right to receive pension benefits that
included COLAs, the panel viewed as no impediment the Debt
Limitation or Appropriations Clauses of the New Jersey
Constitution. Id. at 246. The panel stated that the funds
initially necessary to address plaintiffs’ claims could come
from monies presently held by the respective systems and funds
and would not require payment through a State appropriation.
Ibid. The panel added that those constitutional provisions
would require analysis when a court-ordered State appropriation
14
would be triggered. Ibid. In the end, having found the
existence of a contract right, the panel reversed the trial
court’s dismissal of the action and remanded for a contract-
impairment analysis, which the trial court had not reached. Id.
at 263.
Although it had no impact on the State Contract Clause
analysis, the panel found that plaintiffs’ Federal Contract
Clause claims were properly dismissed. Id. at 247-48.
Plaintiffs’ other claims were rejected, as those claims
“recycl[ed] arguments that were litigated and decided adversely
to the intervenor-plaintiffs in . . . prior state and federal
lawsuits.” Id. at 247.
Ouslander filed a petition for certification, contending
that, contrary to the holding of the Appellate Division, the
suspension of COLAs implicates the Due Process Clause and
invokes the doctrine of equitable estoppel. He also argues that
the Appellate Division improperly dismissed his Federal Contract
Clause claim on sovereign immunity grounds, because the State
(1) is not protected from constitutional claims, and (2)
alternatively, waived its immunity. The State filed a cross-
petition from the Appellate Division’s judgment. We granted
both applications. 222 N.J. 311 (2015). The parties’ arguments
are refined versions of their presentations to the Appellate
Division; we address them in the course of this opinion.
15
III.
The Contract Clause states, “[n]o State shall . . . pass
any . . . Law impairing the Obligation of Contracts.” U.S.
Const. art. I, § 10, cl. 1. New Jersey’s Constitution includes
a similar guarantee that “[t]he Legislature shall not pass any .
. . law impairing the obligation of contracts, or depriving a
party of any remedy for enforcing a contract which existed when
the contract was made.” N.J. Const. art. IV, § 7, ¶ 3; see also
Burgos v. State, 222 N.J. 175, 193 (2015), cert. denied, __ U.S.
__, 136 S. Ct. 1156, 194 L. Ed. 2d 174 (2016); Fid. Union Tr.
Co. v. N.J. Highway Auth., 85 N.J. 277, 299 (1981) (noting that
United States and New Jersey Constitutions provide “parallel
guarantees”).
Contract impairment claims brought under either
constitutional provision entail an analysis that first examines
whether a change in state law results in the substantial
impairment of a contractual relationship and, if so, then
reviews whether the impairment nevertheless is “reasonable and
necessary to serve an important public purpose.” U.S. Tr. Co.
of N.Y. v. New Jersey, 431 U.S. 1, 25, 97 S. Ct. 1505, 1519, 52
L. Ed. 2d 92, 112 (1977); see also Farmers Mut. Fire Ins. Co. of
Salem v. N.J. Prop.-Liab. Ins. Guar. Ass’n, 215 N.J. 522, 546-47
(2013) (expressing same). The first step in that analysis
involves three inquiries: (1) whether a contractual right
16
exists in the first instance; (2) whether a change in the law
impairs that right; and (3) whether the defined impairment is
substantial. See Gen. Motors Corp. v. Romein, 503 U.S. 181,
186, 112 S. Ct. 1105, 1109, 117 L. Ed. 2d 328, 337 (1992).
In this appeal, there is disagreement on the very standard
to be applied to whether a contract was formed that triggered a
contractual right to ongoing COLAs. We begin with that
fundamental difference because it profoundly affects other
issues and arguments advanced by the litigants.
Plaintiff retirees argue that the standard for reviewing
pension legislation applies to this matter, the standard that is
reserved for remedial legislation generally. New Jersey courts
have considered pension statutes to be remedial in character and
thus deserving of a liberal construction and administration “in
favor of the persons intended to be benefited thereby.” Klumb
v. Bd. of Educ. of Manalapan-Englishtown Reg’l High Sch. Dist.,
Monmouth Cty., 199 N.J. 14, 34 (2009) (quoting Geller v. N.J.
Dep’t of Treasury, Div. of Pensions & Annuity Fund, 53 N.J. 591,
597-98 (1969)).
On the other hand, relying on the general presumption
against finding a contract that is created by a statute, see
National R.R. Passenger Corp. v. Atchison, T. & S.F. Ry. Co.,
470 U.S. 451, 465-66, 105 S. Ct. 1441, 1451-52, 84 L. Ed. 2d
432, 446 (1985), the State argues for a standard that requires
17
the Legislature to express unequivocal intent to contract.
According to the State, that rigorous standard must be applied
to find (1) the existence of a contract, and (2) the terms, or
contours, of that contract as well. In our view, the State’s
position is unassailable.
The cases relied on by plaintiffs involved individual
coverage issues under a public pension scheme. Those cases
considered whether a public employee is entitled to receipt of a
particular form of coverage under an existing statutory benefits
program. There we employ a liberal bent in favor of coverage.
But those cases are not of-a-kind to the question that is before
the Court.
The question before us is whether there is a contractual
right to continued increased adjustment of public pension
benefits. The ramifications of a contract of that sort are
harsh: To find a contract created by statute means that the
Legislature binds itself to a policy choice and surrenders the
power of future elected representatives to cut back on that
choice. See Pittman v. Chicago Bd. of Educ., 64 F.3d 1098, 1104
(7th Cir. 1995) (recognizing that “treat[ing] statutes as
contracts would enormously curtail the operation of democratic
government” and “creat[e] rights that could never be
retracted”). In response, there is a rule -- in this state and
elsewhere -- that holds that because the effect of finding a
18
statutory contract is so severe, only the clearest expression of
statutory language and evidence of legislative intent for such
creation will do.
That rigorous standard found expression by this Court in
Spina v. Consolidated Police and Firemen’s Fund Commission, 41
N.J. 391, 404-05 (1964), where the Court held that there must be
an expression of unequivocal intent by the Legislature in order
to conclude that the legislative branch was giving up its
constitutional right and duty to enact laws by creating a
statute by legislative vote. In Spina, the Court was confronted
with an ailing local public pension fund and a legislative
response thereto that increased both the length-of-service
requirement and the minimum retirement age. Id. at 393. The
question for this Court became “whether the Legislature is free
to rewrite the formula for the good of all who have
contributed.” Id. at 402.
The Court acknowledged that the Legislature could, if it
wished, impose contractual obligations on itself. Id. at 405.
But to do so, the Court required a high bar for the creation of
contracts by statute because contractual language in a statute
cuts off the legislative prerogative to revisit its policy
choices. Id. at 404-05. Writing for the Court, Chief Justice
Weintraub explained that a contractual restriction on future
legislative action “should be so plainly expressed that one
19
cannot doubt the individual legislator understood and intended
it.” Id. at 405 (emphasis added). That standard has remained
the benchmark in this state for determining whether a contract
has been created by statute. See N.J. Educ. Ass’n, supra, 412
N.J. Super. at 206-07 (“[A] statute will not be presumed to
create private, vested contractual rights, unless the intent to
do so is clearly stated. This is because the effect of such
authorization is to surrender the fundamental legislative
prerogative of statutory revision and amendment and to restrict
the legislative authority of succeeding legislatures.” (internal
citations omitted)).
Just last term, looking to whether the Legislature created
a contractual right under a different provision of Chapter 78,
we asked whether the Legislature spoke “with sufficient clarity
to evince intent to create a contract right.” Burgos, supra,
222 N.J. at 194. We pointed to Spina and to the United States
Supreme Court’s cautionary direction to courts in Federal
Contract Clause matters “not to presume that a statute creates
private contract rights unless ‘some clear indication’
establishes the intent to do so.” Id. at 195 (quoting Nat’l
R.R. Passenger Corp., supra, 470 U.S. at 465-66, 105 S. Ct. at
1451, 84 L. Ed. 2d at 446).
Spina and Burgos did not break new ground but rather drew
on a long-held presumption against contracts by statute. See
20
Wis. & Mich. Ry. Co. v. Powers, 191 U.S. 379, 386-87, 24 S. Ct.
107, 108, 48 L. Ed. 229, 231 (1903) (“[I]t is clear that we
should require an adequate expression of an actual intent on the
part of the state to set change of position against promise
before we hold that it has parted with a great attribute of
sovereignty beyond the right of change.”); see also Keefe v.
Clark, 322 U.S. 393, 397-98, 64 S. Ct. 1072, 1074, 88 L. Ed.
1346, 1349 (1944); Dodge v. Bd. of Educ., 302 U.S. 74, 79, 58 S.
Ct. 98, 100, 82 L. Ed. 57, 62 (1937); Stanislaus Cty. v. San
Joaquin & King’s River Canal & Irrigation Co., 192 U.S. 201,
208, 24 S. Ct. 241, 244, 48 L. Ed. 406, 410-11 (1904); E.
Saginaw Salt Mfg. Co. v. E. Saginaw, 80 U.S. 373, 378-79, 20 L.
Ed. 611, 614 (1872); Proprietors of Charles River Bridge v.
Proprietors of Warren Bridge, 36 U.S. 420, 551, 9 L. Ed. 773,
825-26 (1837); Shiner v. Jacobs, 17 N.W. 613, 613 (Iowa 1883);
People ex rel. Cunningham v. Roper, 35 N.Y. 629, 633 (1866);
Jack M. Beermann, The Public Pension Crisis, 70 Wash. & Lee L.
Rev. 3, 49 (2013) (“When determining whether a protected
contractual relationship exists, courts are very sensitive to
states’ interest in remaining flexible and retaining their full
regulatory authority. This judicial instinct in the United
States dates back at least to the famous Charles River Bridge
case [36 U.S. 420, 9 L. Ed. 773 (1837)] . . . .”).
21
A searching inquiry is also applied in disputes involving
the terms of a public contract by statute. Courts must “proceed
cautiously both in identifying a contract within the language of
a regulatory statute and in defining the contours of any
contractual obligation.” Nat’l R.R. Passenger Corp., supra, 470
U.S. at 466, 105 S. Ct. at 1452, 84 L. Ed. 2d at 446 (emphasis
added); see also Robertson v. Kulongoski, 466 F.3d 1114, 1117
(9th Cir. 2006) (recognizing that “[t]he first sub-inquiry is
not whether any contractual relationship whatsoever exists
between the parties, but whether there was a contractual
agreement regarding the specific . . . terms allegedly at issue”
(alteration in original) (internal quotation marks omitted)),
cert. denied, 550 U.S. 935, 127 S. Ct. 2262, 167 L. Ed. 2d 1092
(2007).
Faced with a legislative decision to reduce COLAs for
public employee pensions, the United States Court of Appeals for
the First Circuit recently applied its variant of the “clear
indication” standard in a setting close to the one presented
here. Me. Ass’n of Retirees v. Bd. of Trs. of Me. Pub. Emps.
Ret. Sys., 758 F.3d 23 (1st Cir. 2014). The threshold for
recognizing the creation of legislative contracts, the First
Circuit explained, “has been referred to as the ‘unmistakability
doctrine.’” Id. at 29 (quoting Parker v. Wakelin, 123 F.3d 1, 5
(1st Cir. 1997), cert. denied, 523 U.S. 1106, 118 S. Ct. 1675,
22
140 L. Ed. 2d 813 (1998)). The First Circuit noted that the
unmistakability doctrine serves the twin goals of limiting the
ability of contractual rights to curb the State’s legislative
power and avoiding “difficult constitutional questions” about
the ability of one legislature to tie the hands of future
legislatures. Ibid. (quoting United States v. Winstar Corp.,
518 U.S. 839, 875, 116 S. Ct. 2432, 2455, 135 L. Ed. 2d 964, 991
(1996) (plurality opinion)).
Taking its cue from National Railroad, the First Circuit
applied the unmistakability doctrine to both the existence and
terms of a statutory contract. Id. at 30. Accordingly, the
panel assumed that Maine’s pension statutes created at least
some type of contractual obligation and “focus[ed] instead on
whether COLAs [were] included in that obligation.” Ibid.
Because it was not “unmistakably clear” that COLAs fell under
“the umbrella of benefits,” and therefore beyond the reach of
legislative amendment, the First Circuit concluded that the
retirees’ Contract Clause argument failed. Id. at 31.
Courts across the country have applied the unmistakability
standard, or a similarly worded test for such clarity of
expression, in cases like this one -- legislative suspension or
reduction of COLAs. See, e.g., Am. Fed’n of Teachers -- N.H. v.
State, 111 A.3d 63, 69 (N.H. 2015) (“Recognizing that the
principal function of a legislature is not to make contracts,
23
but to make laws that establish the policy of the state, we
recently adopted the unmistakability doctrine.” (internal
quotation marks omitted)); Justus v. State, 336 P.3d 202, 208-09
(Colo. 2014) (“[I]t is presumed that the legislature did not
intend to bind itself contractually and that the legislation was
not intended to create a contractual right unless there is a
clear indication of the legislature’s intent to be bound.”).
In sum, the clearly indicated standard serves an important
public policy purpose. Statutes are the expression of
legislative policy and may accordingly be changed at the
Legislature’s will. Spina, supra, 41 N.J. at 400. But that is
not so if a contract is found. Then, legislation “creat[es]
rights that [can] never be retracted or even modified.”
Pittman, supra, 64 F.3d at 1104. Because the Legislature cedes
significant sovereign power by the creation of a legislative
contract, the clear indication, or unmistakability, standard is
designed to prevent that power from being yielded too easily.
See, e.g., Parella v. Ret. Bd. of the R.I. Emps.’ Ret. Sys., 173
F.3d 46, 60 (1st Cir. 1999) (recognizing that because public
contractual obligation prevents subsequent legislatures from
altering that obligation “for merely rational reasons,” “there
is, for the purposes of the Contract Clause, a higher burden to
establish that a contractual obligation has been created”);
Studier v. Mich. Pub. Sch. Emps. Ret. Bd., 698 N.W.2d 350, 366
24
(Mich. 2005) (“It seems obvious that to read what is a contract
too broadly swallows the right of the people to change the
course of their governance.”). New Jersey courts have adhered
to that standard in the past and we hold that it applies here.
See Spina, supra, 41 N.J. at 405; see also Burgos, supra, 222
N.J. at 194-95; N.J. Educ. Ass’n, supra, 412 N.J. Super. at 206-
07.
With the clearly indicated standard in mind, we turn to the
statutes at issue in this appeal.
IV.
A.
Plaintiffs claim that by contractually guaranteeing the
“benefits program,” the Legislature created in the non-
forfeitable-right statute a right that is broad in scope. From
that inclusive, broadly worded right, plaintiffs highlight the
express legislative exclusion of medical benefits. Because the
Legislature specifically excluded medical benefits from the non-
forfeitable right, yet did not expressly exclude COLAs,
plaintiffs think it unmistakable that COLAs fall under the
umbrella of the benefits program. The State responds that
plaintiffs improperly focus on what the Legislature expressly
excluded from the benefits program instead of what the
Legislature expressly included.
25
We therefore begin with a close examination of the non-
forfeitable-right statute. Adopted in 1997 as an added section
to an Administration-drafted bill,3 section 5 of Chapter 113
provides in pertinent part:
5. a. For purposes of this section, a
“non-forfeitable right to receive benefits”
means that the benefits program, for any
employee for whom the right has attached,
cannot be reduced. The provisions of this
section shall not apply to post-retirement
medical benefits which are provided pursuant
to law.
b. Vested members of the Teachers’
Pension and Annuity Fund, the Judicial
Retirement System, the Prison Officers’
Pension Fund, the Public Employees’ Retirement
System, the Consolidated Police and Firemen’s
Pension Fund, the Police and Firemen’s
Retirement System, and the State Police
Retirement System, upon the attainment of five
years of service credit in the retirement
system or fund or on the date of enactment of
this bill, whichever is later, shall have a
3 The bill originally addressed statutory terms that the State
agreed to enact as part of its settlement with the IRS that
concerned an unrelated issue and ensured that the State plans
operated in conformance with the Internal Revenue Code (IRC).
See L. 1997, c. 113, §§ 1 – 4 (codified as N.J.S.A. 43:3C-9.1 –
9.4). Significantly, the Legislature foreclosed the prior
practice of allowing movement of State contributed funds into
and out of the State’s pension systems or funds prior to the
close of the fiscal year, when remittance was due of all final
amounts of required State contributions to the various systems
and funds. See N.J.S.A. 43:3C-9.1. With that amendment, once
State-contributed funds were moved into the individual systems
or funds, the monies then became corpus of the retirement system
or fund and could not be removed, even if the amount was in
excess of the required State contribution. Ibid. The monies
became designated for the exclusive benefit of the members or
their beneficiaries. Ibid.
26
non-forfeitable right to receive benefits as
provided under the laws governing the
retirement system or fund upon the attainment
of five years of service credit in the
retirement system or fund or on the effective
date of this act, whichever is later.
. . . .
e. Except as expressly provided herein
and only to the extent so expressly provided,
nothing in this act shall be deemed to (1)
limit the right of the State to alter, modify
or amend such retirement systems and funds, or
(2) create in any member a right in the corpus
or management of a retirement system or
pension fund.
[L. 1997, c. 113, § 5 (codified as N.J.S.A.
43:3C-9.5).]
Subsection (a) of N.J.S.A. 43:3C-9.5 defines the “non-
forfeitable right to receive benefits” as inapplicable to
medical benefits. The definition otherwise protects the
“benefits program” from reduction but does not expressly exclude
anything else. Plaintiff retirees point to that definitional
language as evidence of a clear legislative intent that COLAs
were not meant to be excluded from the protected right.
The State’s response focuses on subsection (b)’s reference
to “benefits as provided under the laws governing the retirement
system or fund.” Because, in the State’s view, COLAs are
substantively housed in the Pension Adjustment Act, N.J.S.A.
43:3B-1 to -10, they are not provided by the “laws governing the
retirement system or fund” and thus are not part of the non-
27
forfeitable right. And the State emphasizes that the
Legislature has otherwise distinguished the pension benefit from
the cost-of-living adjustment.
In our examination of those textual arguments, we note that
subsection (b) is the operative subsection to the non-
forfeitable-right statute. Beyond declaring the non-forfeitable
right’s existence, it contains a description of what comprises
the non-forfeitable right that vested members of the public
pension systems receive. Specifically, subsection (b)’s first
clause refers to the individual pension systems and funds by
name and declares, as non-forfeitable, vested members’ “right to
receive benefits as provided under the laws governing the
retirement system or fund.” Because the non-forfeitable right
protects “benefits as provided under the laws governing the
retirement system or fund,” identified individually by name, we
therefore examine the statutes of the individual retirement
systems or funds to understand the benefits purportedly provided
non-forfeitable protection. The non-forfeitable-right statute
provides no further guidance on the subject.
On close review, it appears that the non-forfeitable-right
statute’s reference to benefits provided “under the laws
governing the retirement system or fund” is a reference to
corresponding terminology in the respective individual public
pension statutory schemes. The public pension retirement
28
schemes define each individual “system” or “fund” using common
phraseology. That language in each of the systems or funds
consistently describes payment of retirement allowances and
other benefits under the provisions of that system’s enabling
act or law. We use the Public Employees’ Retirement System of
New Jersey as an example, although the phrasing is similar if
not identical in all corresponding provisions in the other
systems or funds:
“Public Employees’ Retirement System of New
Jersey,” hereinafter referred to as the
“retirement system” or “system,” is the
corporate name of the arrangement for the
payment of retirement allowances and other
benefits under the provisions of this act
including the several funds placed under said
system.
[N.J.S.A. 43:15A-6(m) (emphasis added).]4
The emphasized language thus defines the system itself (or fund
where that term is employed as the system’s name) as the means
for providing the retirement allowance and other benefits
provided to a beneficiary under the provisions of that system’s
4 See also N.J.S.A. 18A:66-2(q) (defining similarly “Teachers’
Pension and Annuity Fund”); N.J.S.A. 43:16A-1(1) and N.J.S.A.
43:16A-2 (same for “Police and Firemen’s Retirement System”);
N.J.S.A. 53:5A-3(s) (same for “State Police Retirement System of
New Jersey”); N.J.S.A. 43:6A-3(q) (same for “Judicial Retirement
System of New Jersey”).
29
enabling act. It does not include reference to benefits
authorized to be paid to a beneficiary via other statutes or
acts.
In similar fashion, the respective pension schemes use
common definitions of key words, which repeatedly emphasize that
the benefits conferred under the particular system or fund are
those provided for under that fund’s or system’s enabling act or
law. Continuing to use PERS as an example, we note that the
Legislature carefully constructed the conferred benefit and
related terms by reference to those provided through the
particular statutory act for the pension system. “Beneficiary”
means “any person receiving a retirement allowance or other
benefit as provided in this act.” N.J.S.A. 43:15A-6(d)
(emphasis added). See also N.J.S.A. 43:15A-6(k) (defining
“pension” as “payments for life derived from appropriations made
by the employer as provided in this act” (emphasis added));
N.J.S.A. 43:15A-6(b) (defining “annuity” as “payments for life
derived from the accumulated deductions of a member as provided
in this act” (emphasis added)). Importantly, “retirement
allowance” also is defined to mean simply “the pension plus the
annuity,” N.J.S.A. 43:15A-6(o), thus restricting it to those
benefits listed above, all of which are delimited to the
formulaic terms and conditions set forth fully in the enabling
act of the specific retirement system or fund.
30
Considering that the individual systems and funds define
benefits as those made available to beneficiaries only pursuant
to the provisions of their respective acts, the State urges this
Court to find that COLAs are not part of the protected non-
forfeitable right. The State relies in good measure on the fact
that COLAs are not provided to retired members of those systems
or funds through the enabling act or law governing the specific
retirement system or fund. Rather, COLAs are authorized and are
provided to retirees by way of separate legislation -- the
Pension Adjustment Act.
N.J.S.A. 43:3B-2 of the PAA expressly provides for
adjustment of the monthly amount of “retirement allowance or
pension originally granted to any retirant” (emphasis added), or
corresponding “pension or survivorship benefit originally
granted to any beneficiary” of a deceased member. The statutory
authorization for “adjustment” to the retirement allowance or
pension brings the reader back to the touchstone definitions of
those and related terms in the individual retirement schemes,
all of which define their statutory program of benefits based on
the act or law that enables that retirement system or fund.
The sole reference to COLAs in each retirement system’s or
fund’s enabling acts is narrow: COLAs are made a liability of
the fund or system. See, e.g., N.J.S.A. 43:15A-24.1. The
language providing for that liability is the same in each of the
31
pension systems or funds in issue that contain even this lone
mention of a COLA in their codified scheme;5 therefore, we quote
from the example cited:
Pension adjustment benefits; payment;
funding; liability
Pension adjustment benefits for members and
beneficiaries of the Public Employees’
Retirement System provided by the “Pension
Adjustment Act,” P.L.1958, c. 143 (C.43:3B-1
et seq.), shall be paid by the retirement
system and shall be funded as employer
obligations by the same method provided by law
for the funding of employer obligations for
the basic retirement benefits provided by the
retirement system.
[N.J.S.A. 43:15A-24.1 (emphasis added).]
The above text distinguishes between pension retirement
benefits and pension adjustment benefits within the same
sentence. Coupled with the separate provision of COLAs in the
PAA, that suggests that the Legislature considered the pension
benefit and the cost-of-living adjustment distinct. Without the
substantive COLA provisions incorporated into the “laws
governing the retirement system or fund,” there is insufficient
evidence to show that making COLAs a liability of the system or
5 See N.J.S.A. 18A:66-18.1 (TPAF); N.J.S.A. 43:6A-33.1 (JRS);
N.J.S.A. 53:5A-34.2 (SPRS); N.J.S.A. 43:16A-15.6 (PFRS).
32
fund made them a part of the benefits program. How a liability
is paid does not necessarily alter the nature of the benefit.6
Despite argument to the contrary, and the view expressed in the
dissent, it is the PAA that confers COLAs. The statutes
governing the retirement systems or funds may reference COLAs
and provide the mechanics for their funding, but they do not
confer them. Only the PAA does that.
Read together, the language of Chapter 113 and the
substantive provisions of the individual retirement systems or
funds reasonably support the State’s position. The non-
forfeitable-right statute’s protection of benefits “provided
under the laws governing the retirement system or fund” refers
to the operative enabling provisions of those systems and funds,
which, as set forth earlier, do not provide authorization for
COLAs.
The State also provides a rationale for the Legislature’s
express exclusion of medical benefits. The State maintains that
6 Just as N.J.S.A. 43:15A-24.1 did not effectuate a change in the
nature of the pension adjustment benefit by making it a
liability of the fund, paid for as a prefunded employer
obligation, the statute’s earlier inclusion of medical benefits
did not alter their nature. The prefunding of medical benefits
for PERS and TPAF ended in 2007. See L. 2007, c. 103, §§ 43,
44. The prefunded nature of both COLAs and medical benefits at
the time of the enactment of the non-forfeitable-right statute
in 1997 does not signal clear evidence that either was
substantively incorporated and provided to retirees and pension
members under either PERS’s or TPAF’s statutory schemes.
33
the exclusion was based on the need to ensure that medical
benefits be subordinate to retirement benefits in order for the
State’s retirement plans to remain “qualified” plans under the
Internal Revenue Code. See 26 U.S.C.A. § 401(h)(1). Medical
benefits are subordinate to retirement benefits if, in any given
year, the contributions for medical benefits, combined with
contributions for life insurance, do not exceed twenty-five
percent of the aggregate contributions for retirement benefits.
See 26 C.F.R. 1.401-14(c)(1)(i). In New Jersey, medical
benefits were made subject to negotiation one year prior to
passage of the non-forfeitable-right statute. See L. 1996, c.
8, § 6. Thus, according to the State, there existed a realistic
potential for inflation of medical benefit costs. If benefits
increased in a particular year and could not thereafter be
reduced because they were deemed to be non-forfeitable, and the
cost of medical benefit payments exceeded the twenty-five
percent threshold, a State retirement plan affected in that way
would not remain a qualified plan under the IRC. Although that
scenario had not yet occurred in New Jersey, the consequences of
a plan being held unqualified were so significant that the
Legislature’s action eliminated any doubt on the subject,
according to the State.
That plausible explanation dispels the notion that the
express exclusion of medical benefits can evince only a clear
34
intent on the part of the Legislature to include all else,
including COLAs, in the non-forfeitable right. At the very
least, the State maintains that the reasonableness of the
argument undercuts confidence in any “clearly indicated intent”
that requires us to interpret the exclusion as a green light to
include COLAs as a protected term of the contract right
conferred by the non-forfeitable-right statute through its
reference to “benefits program.”
Plaintiffs argue that by using the term “benefits program”
the Legislature melded the base pension benefit to the COLA. In
response, the State relies on statutory language that, it says,
does not make the two parts one under the law. The State
maintains that, in New Jersey, the COLA never becomes part of
the base pension and is not compounded annually. Rather, as
explained by the State, tracking the PAA’s language, N.J.S.A.
43:3B-2 provides that the monthly retirement allowance
“originally granted” to a retiree shall be adjusted in
accordance with the provisions of the PAA. In greater detail,
the State provides an example to illustrate the PAA’s operation.
Utilizing the formula in the PAA, as it operated prior to
Chapter 78’s enactment, a person’s base retirement allowance
would be entitled to an adjustment equal to sixty percent of the
difference between the Consumer Price Index in the year of
retirement and the then-current year. The following year, the
35
retirement allowance would be reset to the original amount and
the person would again be entitled to an adjustment equaling
sixty percent of the difference between the CPI in the year of
retirement and the then-current year.
This is not an ordinary statutory interpretation case, so
our task here is not to determine which textually based argument
is more likely than not the actual intent of the Legislature.
To find a statutory contract that would have the effect of
restricting subsequent legislative action on the subject, we
must find unmistakable evidence of legislative intent to create
a non-forfeitable right to COLAs. Fairly viewed, the parties’
many arguments are reasonable. Plaintiffs forcefully argue that
although medical benefits were expressly excluded from the non-
forfeitable right, COLAs were not. The State offers equally
persuasive reasons to conclude that the Legislature did not
intend to include COLAs as part of the non-forfeitable right:
COLAs (substantively provided for in the PAA) are not found in
“the laws governing the retirement system or fund” and the
Legislature had an independent reason for excluding medical
benefits.
Based on our review of the substantive provisions of the
retirement systems’ or funds’ laws referenced in the non-
forfeitable-right statute, which detail the benefits receiving
protection, and the absence of COLAs from those provisions, we
36
find plaintiff retirees’ arguments insufficient. The plain
language of the non-forfeitable-right statute does not surely
embrace COLAS, as it must to satisfy Spina. Although the
dissent states that it tracks Spina, by slighting the State’s
plausible arguments, its analysis strays from that case and
substitutes equitable concerns for the required standard.
Notwithstanding the dissent’s view, a crisp guarantee of
continued COLAs cannot be found in the text of the non-
forfeitable-right statute.
To succeed, the plaintiffs needed to demonstrate that the
legislative intent to render future COLAs part of the non-
forfeitable right conferred by Chapter 113 was unmistakable.
From a textual standpoint, that high standard simply is not met
here.7
B.
7 Post-argument, plaintiffs brought to our attention a recent
decision of the Illinois Supreme Court, finding that a
legislative reduction in COLAs violated the Pension Protection
Clause in the Illinois Constitution. Jones v. Mun. Emps.
Annuity & Ben. Fund of Chi., __ N.E.3d __ (Ill. 2016). We find
that case unpersuasive for the same reason we find the substance
of the analyses of many of the out-of-state cases cited by the
State of little help: the COLA question was considered against
a wholly different statutory (or in the case of the Illinois
decision, constitutional) backdrop. To the extent that we rely
on out-of-state cases, our reliance has been limited to general
principles applicable regardless of the precise statutory
language. The language of our statutes controls the outcome
here.
37
Plaintiffs next argue that legislative history further
reveals the unmistakable legislative intent to include COLAs
under the protection of the non-forfeitable-right statute.
Plaintiffs also look to the history and nature of COLAs, arguing
that they support their claim that the base pension benefit and
COLAs are one and the same.
Ordinarily, we do not turn to extrinsic aids such as
legislative history unless there is some ambiguity on the face
of the statute itself. See DiProspero v. Penn, 183 N.J. 477,
492-93 (2005). But if there is ambiguity requiring resort to
legislative history, one is already outside the realm of
unmistakable clarity needed to find a statutory contract right.
Although it is not beyond the pale for courts to consider
legislative history advanced by litigants looking to “overcome
the hurdle of the unmistakability doctrine,” see R.I. Bhd. of
Corr. Officers v. Rhode Island, 357 F.3d 42, 46 n.3 (1st Cir.
2004), we find reliance on that type of extrinsic evidence
necessarily weak. In this setting, any ambiguity spells failure
for claims that the Legislature created a contractual right to
COLAs. The intent to contract must be unmistakable.
Even if we were to look at legislative history, evidence of
such unmistakable intent is wanting there. First, plaintiffs
rely on the committee statement accompanying the non-
forfeitable-right statute. They emphasize that nothing in that
38
statement suggested that COLAs were excluded from the non-
forfeitable right. See Senate Budget and Appropriations
Committee, Statement to S. No. 1119 (1997). That argument fails
for the same reason plaintiffs’ textual argument fails. It adds
nothing beyond the text of the statute, and it focuses on what
is unmistakably excluded from the non-forfeitable right instead
of what is unmistakably included.
Even weaker is plaintiffs’ reliance on a transcript of a
legislative hearing conducted by the Senate State Management,
Investment and Financial Institutions Committee on the State’s
pension system, a committee that never passed on the bill that
was ultimately introduced and enacted as Chapter 113. See
Public Hearing Before Senate State Management, Investment and
Financial Institutions Committee (May 20, 1996). Only two
Senators were present at the hearing, and one departed midway
through the hearing. Id. at 49. Much of the hearing focused on
the actuarial soundness of the pension funds. But the
discussion later moved to the question of whether public
employees should have a contractual right to their pension
benefits. Id. at 53.
Plaintiffs focus on the remaining Senator’s remarks. After
urging by a union representative that a bill to conform the
pension funds to IRS requirements contain additional contractual
language, the Senator responded that he “[felt] strongly that
39
the same protections and rights that are accorded, say, under an
ERISA [Employee Retirement Income Security Act] standard to
people in the private sector, should be accorded to people in
the public sector.” Id. at 69. He continued, explaining that,
in his view, once public employees “have their pensions
established as at a point in time with regard to vesting it,
that you cannot go back retroactively and change what has been
earned, what has been accrued, what has been vested in.” Ibid.
Believing that ERISA provides that protection, the Senator added
that “[s]urely, at a minimum, that is what we should provide
here, too.” Ibid.
That type of legislative history is not reliable. The
hearing was a forum for airing views by the relevant
stakeholders, including representatives from the State and
various labor unions, on the current soundness of the pension
funds and how to best ensure their long-term viability. After
the discussion turned to what would eventually be conceptualized
as the non-forfeitable-right statute, the sole remaining Senator
offered a preliminary take on the subject, but “the statements
of individual legislators are not generally considered to be a
reliable guide to legislative intent.” State v. Yothers, 282
N.J. Super. 86, 104 (App. Div. 1995) (Skillman, J.A.D.,
dissenting). We can reliably cast the Senator’s statements as
his personal thoughts on the topic, thoughts that he
40
acknowledged were preliminary. No more, no less. We cannot
accept that to be a definitive and unmistakable pronouncement of
legislative intent.
Second, plaintiffs contend that the history of COLAs
supports the reasonable expectation that they were part and
parcel of the singular pension benefit provided on a monthly
basis to retirees or their beneficiaries. However, the history
of COLAs in New Jersey points to the opposite conclusion: that
the Legislature granted COLAs as periodic exercises of
legislative discretion separate and apart from the base pension,
responding to evolving economic, social, and political dynamics.
Cf. Justus, supra, 336 P.3d at 209 (“By its very nature a
statutory cost of living adjustment is a periodic exercise of
legislative discretion that takes account of changing economic
conditions in the state and/or nation.”).
In New Jersey, COLAs were not always automatic. They were
instead provided from time to time when the Legislature was
persuaded that an adjustment calculated on fiscal realities
would be the appropriate public policy of the State. The
frequent legislative tinkering with the COLA formula over the
years only underscores that reality. See, e.g., L. 1958, c.
143, § 3 (granting first COLAs to retirees who retired before
1952); L. 1961, c. 144, § 2 (granting COLAs to retirees who
retired between 1952 and 1954); L. 1969, c. 169, §§ 1, 2, 5
41
(expanding COLAs to all eligible retired public employees and
providing adjustments based on CPI); L. 1977, c. 306, § 4
(increasing percentage of adjustment from one-half to three-
fifths of percentage change in CPI); L. 1981, c. 128, § 1
(increasing percentage of adjustment from three-fifths to two-
thirds of percentage change in CPI); L. 1981, c. 128, § 2(a)
(returning adjustment to three-fifths of change in CPI);
N.J.S.A. 43:3B-7(a) (“The percentage of adjustment shall be
[three-fifths] of the percentum of change.”); see also Justus,
supra, 336 P.3d at 212 (“Modifications over the past half
century reflect the legislature’s unbridled management of the
COLA . . . .”).
Plaintiffs’ argument taken to its logical end is that, even
before the non-forfeitable-right statute was passed, all
pensioners -- vested and retired members -- had a reliable
expectation that future adjustments under the present CPI
formula in the COLA statute could not be prospectively suspended
or adjusted. So viewed, once the Legislature granted the first
COLAs, COLAs became a perpetual right. But that cannot be, for
that is precisely what the presumption against a contract right
is designed to prevent -- the hamstringing of the Legislature’s
right to enact new or changed laws to address present needs.
See Wash. Educ. Ass’n v. Dep’t of Ret. Sys., 332 P.3d 439, 446
(Wash. 2014) (“Surely the legislature can make the addition of
42
[a COLA] subject to its right to amend or repeal the program in
the future. To say otherwise would strongly disincentivize the
legislature from providing additional benefits beyond a basic
pension.”); see also Pittman, supra, 64 F.3d at 1104 (“A statute
is not a commitment by the legislature never to repeal the
statute.”). Indeed, in subsection (e) of the non-forfeitable-
right statute, the Legislature specifically reiterated that any
benefit not guaranteed by the statute is subject to change by
the Legislature. N.J.S.A. 43:3C-9.5(e).
Moreover, the State points to additional statutory support
to view COLAs and retirement benefits as not melded together by
statute or practice. COLAs are tied to the CPI, making a year-
to-year increase uncertain and even allowing for a negative
adjustment. See N.J.S.A. 43:3B-7(a); see also Bartlett v.
Cameron, 316 P.3d 889, 895 (N.M. 2013) (“Future economic growth
is neither consistent nor dependable, and any adjustment
predicated on economic growth is at best indefinite,
antithetical to a vested property right.”).
But a negative adjustment cannot take the total amount a
retiree receives below the initial base benefit. See N.J.S.A.
43:3B-7(a) (allowing for negative adjustment but providing that
“[i]n no instance shall the amount of the retirement allowance
or pension originally granted and payable to any retirant be
reduced as a result of [an] adjustment”). That legislative
43
distinction between the COLA and the initial pension amount --
the benefits floor, below which the amount received cannot drop
-- supports the State’s argument that the two are not one and
the same. See Me. Ass’n of Retirees, supra, 758 F.3d at 31
(accepting as “possible” argument that “in setting the
retirement-date pension amount as the floor below which a
negative CPI could not reduce the allowance, the Legislature
arguably treated the base pension amount as the benefit,
protected against deflationary reduction, and COLA increases as
potentially temporary adjustments to that benefit” (internal
citation omitted)). As the State points out, Chapter 78 did not
purport to take away any adjustment already made; it simply
stopped further adjustment until certain conditions were met.
After Chapter 78, no retiree saw his monthly pension benefit
drop.
To adopt the retirees’ argument about prior practice
providing the basis for an implicit contract right to ongoing
COLAs reads into Chapter 113 -- which is silent on COLAs -- a
perpetual escalator clause entirely out of State control, driven
only by the pertinent CPI. The Legislature’s right to set the
policy of this State as it sees fit cannot permit such a result
unless a law clearly and unmistakably takes that power away from
future legislatures.
44
We conclude that the additional extrinsic evidence does not
further the retirees’ argument that the Legislature acted with
the required intent. The text of the non-forfeitable-right
statute is not sufficiently clear to have unmistakably conferred
a statutory contract right to continued COLAs. Nor is its
surrounding history. The Appellate Division’s careful analysis
went awry in reversing that presumption. Moreover, Chapter 78
enjoys a presumption of constitutionality. And the
Legislature’s view that its prior action in Chapter 113 did not
prevent future suspensions of COLAs is relevant in our
consideration. See Varsolona v. Breen Capital Servs. Corp., 180
N.J. 605, 623 (2004) (“[S]ubsequent legislation may be used by a
court as an extrinsic aid when seeking to discern earlier
legislative intent.”). Clearly, the Legislature did not think
itself bound to never suspend the PAA right to continued
increases in pension adjustments based on cost-of-living
indices. To find a contrary intent requires a much greater
demonstration than the plaintiffs have available to them.
All of the aforesaid arguments considered, we conclude that
the statutory and contract claims advanced by plaintiffs must
fail. For the Legislature to have given up so much control over
a future Legislature’s ability to react to the present needs of
the State, the expression of a statutory contract and the
individual terms of such a contract must be unmistakably clear.
45
That clarity is absent here in respect of the continued right to
receive additional COLAs after their suspension in 2011.8
V.
Finally, and alternatively, petitioner Ouslander contends
that equity prevents the State from terminating COLAs for those
employees who retired prior to the enactment of Chapter 78.
More specifically, petitioner claims he is entitled to a remedy
for the State’s actions under the principles of procedural and
substantive due process and equitable estoppel. Because the
language of the non-forfeitable-right statute does not guarantee
COLAs, it necessarily follows that the retirees could not
reasonably rely on the statute’s terms for purposes of a claim
in equity.
To support an estoppel theory, a litigant must prove that
the opposing party “engaged in conduct, either intentionally or
under circumstances that induced reliance[.]” Knorr v. Smeal,
178 N.J. 169, 178 (2003). This involves “a knowing and
intentional misrepresentation” by the party against whom
estoppel would apply. O’Malley v. Dep’t of Energy, 109 N.J.
309, 317 (1987). The non-forfeitable-right statute’s disputed
8 Because we find no statutory contract right, there is no need
to examine further petitioner Ouslander’s challenge to the
Appellate Division’s rejection of his arguments on sovereign
immunity and its application to a claimed violation of the
Federal Contract Clause. We will not address an issue that is
unnecessary to our disposition.
46
language does not unambiguously include COLAs within its
guarantee, so the text itself does not suggest an intentional
representation by the Legislature of the certain payment of
perpetual adjustments. Even the State’s course of conduct -- in
this case the continual payment of COLAs for decades -- must be
tempered by the limited reach of the language of the non-
forfeitable-right statute and the Legislature’s prerogative to
change the laws. The retirees could not reasonably expect
perpetual COLAs when the non-forfeitable-right statute
specifically notes that any benefit not guaranteed by the
statute, a category that we hold includes COLAs, is subject to
change by the Legislature. N.J.S.A. 43:3C-9.5(e). To hold
otherwise would suggest that the pensioners had a right to
receive continued pension payments before the statute was
enacted, which is contrary to the history of COLA legislation
and the ability of the Legislature to amend, repeal, and modify
legislation.
Petitioner’s due process claims are unavailing for similar
reasons. Those claims depend on the existence of a vested
right, Twiss v. State, 124 N.J. 461, 467 (1991); the continued
receipt of COLAs cannot be categorized in that way based on the
current text of the non-forfeitable-right statute. This is
especially true because the heightened standard of National
Railroad, supra, applies equally to an analysis of vested rights
47
created by statute. See 470 U.S. at 465-66, 105 S. Ct. at 1451,
84 L. Ed. 2d at 446 (“[A]bsent some clear indication that the
legislature intends to bind itself contractually, the
presumption is that a law is not intended to create private
contractual or vested rights but merely declares a policy to be
pursued until the legislature shall ordain otherwise.” (emphasis
added) (internal quotation marks omitted)).
Ultimately, petitioner’s alternative claims are belied by
the same evidence that guided our Contract Clause analysis. The
text of the non-forfeitable-right statute does not reveal an
unequivocal intent of the Legislature to include COLAs within
its contractual guarantees. The absence of unequivocal
legislative intent forecloses petitioner’s equitable claims.
Regardless of the merits of petitioner’s claims, the
creation of legislation is an essential function of the
Legislature, so that sovereign immunity bars the equitable
estoppel claim. See O’Malley, supra, 109 N.J. at 316 (noting
application of equitable estoppel against governmental entity is
particularly rare when it would interfere “with essential
governmental functions” (quoting Vogt v. Borough of Belmar, 14
N.J. 195, 205 (1954)); 28 Am. Jur. 2d Estoppel & Waiver § 128
(2011) (“It has been held that estoppel may not be applied
against the government acting in its sovereign capacity.”).
Equitable estoppel may be invoked against a governmental entity
48
only “to prevent manifest injustice.” O’Malley, supra, 109 N.J.
at 316. Here, as in all cases, equity follows the law. Because
we have determined that the non-forfeitable-right statute does
not guarantee COLAs, we decline to provide a remedy in equity
that is not available under the law.
VI.
The judgment of the Appellate Division is reversed, and the
trial court’s judgment dismissing the complaints is reinstated.
CHIEF JUSTICE RABNER; JUSTICES PATTERSON, FERNANDEZ-VINA,
and SOLOMON; and JUDGE CUFF (temporarily assigned), join in
JUSTICE LaVECCHIA’s opinion. JUSTICE ALBIN filed a separate,
dissenting opinion.
49
SUPREME COURT OF NEW JERSEY
A-71/72 September Term 2014
074612
RICHARD W. BERG, ROBERT J.
BRASS, THOMAS CANNAVO,
MELAINE B. CAMPBELL, LARRY
ROBERT ETZWEILER, KATHY
FLICKER, ARNOLD GOLDEN,
CHARLES GRINELL, TONI A.
HENDRICKSEN, HAROLD
KASSELMAN, SUSAN LOTHIAN,
STEPHEN H. MONSON, MARTIN C.
MOONEY, SR., BRIAN
MULHOLLAND, ANNE C. PASKOW,
SHARYN PEIFFER, SAMUEL REAL,
JR., GREGORY J. SAKOWICZ,
SUSAN W. SCIACCA, WILLIAM H.
SCHMIDT, FRED SCHWANWEDE,
JOHN J. SMITH, DEBRA STONE,
SHERI TANNE, AND JACK L.
WEINBERG,
Plaintiffs-Respondents,
and
CHARLES OUSLANDER,
Plaintiff-Appellant
and Cross-Respondent,
and
NEW JERSEY EDUCATION
ASSOCIATION, NEW JERSEY STATE
POLICEMEN’S BENEVOLENT
ASSOCIATION, INC.,
COMMUNICATIONS WORKERS OF
AMERICA, AFL-CIO, NEW JERSEY
FRATERNAL ORDER OF POLICE,
NEW JERSEY STATE
1
FIREFIGHTERS’ MUTUAL
BENEVOLENT ASSOCIATION,
PROFESSIONAL FIREFIGHTERS
ASSOCIATION OF NEW JERSEY,
AMERICAN FEDERATION OF STATE,
COUNTY AND MUNICIPAL
EMPLOYEES, COUNCIL 1, AFL-
CIO, AMERICAN FEDERATION OF
STATE, COUNTY AND MUNICIPAL
EMPLOYEES, COUNCIL 73, AFL-
CIO, AMERICAN FEDERATION OF
TEACHERS NEW JERSEY STATE
FEDERATION, AFL-CIO,
INTERNATIONAL FEDERATION OF
PROFESSIONAL AND TECHNICAL
ENGINEERS, AFL-CIO & CLC,
LOCAL 194, INTERNATIONAL
FEDERATION OF PROFESSIONAL
AND TECHNICAL ENGINEERS, AFL-
CIO, LOCAL 195, INTERNATIONAL
FEDERATION OF PROFESSIONAL
AND TECHNICAL ENGINEERS, AFL-
CIO & CLC, LOCAL 200,
PROBATION ASSOCIATION OF NEW
JERSEY, NEWARK FIREFIGHTERS
UNION, MORRIS COUNCIL NOS. 6
AND 6A, NJCSA IFPTE, AFL-CIO,
JERSEY CITY POLICE OFFICERS
BENEVOLENT ASSOCIATION,
CAMDEN COUNTY COUNCIL #10,
INTERNATIONAL BROTHERHOOD OF
TEAMSTERS LOCAL 97,
BELLEVILLE PBA LOCAL 28, NEW
JERSEY ASSOCIATION OF SCHOOL
ADMINISTRATORS, NEW JERSEY
PRINCIPALS AND SUPERVISORS
ASSOCIATION, NEW JERSEY
ASSOCIATION OF SCHOOL
BUSINESS OFFICIALS, NEW
JERSEY RETIREES’ EDUCATION
ASSOCIATION, TRANSPORT
WORKERS UNION LOCAL 225, NEW
JERSEY SUPERIOR OFFICERS LAW
ENFORCEMENT ASSOCIATION,
2
ATLANTIC CITY WHITE COLLAR
PROFESSIONAL ASSOCIATION,
INTERNATIONAL BROTHERHOOD OF
ELECTRICAL WORKERS LOCAL 210,
ATLANTIC CITY SUPERIOR
OFFICERS ASSOCIATION, PETER
BURKHALTER, DEE TRUCHON,
GEORGE O’BRIEN, THOMAS
TEVLIN, ROBERT BROWER,
ROSEMARIE JANKOWSKI, IRIS J.
ELLIOTT, KENNETH D. KING,
FRANK ELMER HICKS, WILLIAM A.
PARKER, BRAD FAIRCHILD,
DWIGHT COVALESKIE, ANTHONY F.
WIENERS, GARY SOUSS, WILLIAM
LAVIN, CHARLES WEST, MARIAN
LEZGUS, MELANIE HAFDELIN,
STEVEN ENGRAVALLE, CINDY
BARR-RAGUE, DOMINICK MARINO,
JOHN J. GEROW, JANET S.
ZYNROZ, ALFRED CRESCI, RAE C.
ROEDER, MARYANN PIUNNO SMITH,
MARYANN MESICS, DENNIS
REITER, ANTHONY MISKOWSKI,
VINCENT KAIGHN, WILLIAM S.
BAUER, JR., MICHAEL
CALABRESE, and DEBORAH
JACOBS,
Plaintiffs/Intervenors-
Respondents,
v.
HON. CHRISTOPHER J. CHRISTIE,
HON. KIM GUADAGNO, SECRETARY
OF STATE OF THE STATE OF NEW
JERSEY, DIRECTOR, DIVISION OF
PENSIONS, BOARD OF TRUSTEES,
PUBLIC EMPLOYEES’ RETIREMENT
SYSTEM, TREASURER, STATE OF
NEW JERSEY AND STATE OF NEW
JERSEY,
3
Defendants-Respondents
and Cross-Appellants.
MICHAEL DELUCIA, PATRICIA
DELUCIA, ROBERT C. BROWN, AND
ANNE K. BROWN,
Plaintiffs,
v.
STATE OF NEW JERSEY
DEPARTMENT OF THE TREASURY,
DIVISION OF PENSIONS AND
BENEFITS,
Defendants.
JUSTICE ALBIN, dissenting.
Sometimes a plainly written statute is just a plainly
written statute. I do not agree with the majority that the
pension statutes at issue, which guarantee retired public
employees a cost-of-living adjustment (COLA), lack clarity or
are susceptible to two interpretations.
In 1997, the Legislature made a contractual promise to
public employees when it passed the Non-Forfeitable Right
Statute, N.J.S.A. 43:3C-9.5. L. 1997, c. 113, § 5. Public
employees whose pension rights had vested were assured that they
had a “non-forfeitable right to receive benefits as provided
under the laws governing the retirement system or fund,”
N.J.S.A. 43:3C-9.5(b), and that their “benefits program” could
4
not be reduced, N.J.S.A. 43:3C-9.5(a). (Emphasis added). At
the time of the passage of the Non-Forfeitable Right Statute,
the “laws governing the retirement system or fund,” N.J.S.A.
43:3C-9.5(b), specifically provided for cost-of-living
adjustments for retired public employees. The statutory scheme
of each currently open retirement system or fund not only
directly incorporates the Pension Adjustment Act (PAA), N.J.S.A.
43:3B-1 to -10, but also states that pension adjustment benefits
(cost-of-living adjustments) “shall be paid by the retirement
system” to vested public employees.9 The pension fund and system
statutes clearly and distinctly designate COLAs as pension
benefits.
The pension benefits program mentioned in the Non-
Forfeitable Right Statute has three components: base benefits,
1 The pension systems and funds are the Teachers’ Pension and
Annuity Fund, N.J.S.A. 18A:66-1 to -93, the Police and Firemen’s
Retirement System, N.J.S.A. 43:16A-1 to -68, the Public
Employees’ Retirement System, N.J.S.A. 43:15A-1 to -161, the
Judicial Retirement System, N.J.S.A. 43:6A-1 to -47, and the
State Police Retirement System, N.J.S.A. 53:5A-1 to -47. The
two remaining funds mentioned in the Non-Forfeitable Right
Statute, the Consolidated Police and Firemen’s Pension Fund,
N.J.S.A. 43:16-1 to -21, and the Prison Officers’ Pension Fund,
N.J.S.A. 43:7-7 to -27, have been closed to new members since
1944 and 1960, respectively. See N.J.S.A. 43:7-8 (“No person
employed on or after January 1, 1960 shall be eligible for
membership in the Prison Officers’ Pension Fund.”); N.J.S.A.
43:16-17 (defining “member” as “a person who on July 1, 1944,
was a member of a municipal police department . . . fire
department or county police department” for Consolidated Police
and Firemen’s Pension Fund).
5
medical benefits, and COLAs. That statute excludes medical
benefits, but not COLAs. Had the Legislature intended to
exclude COLAs, it knew how to do so. Because the cost-of-living
adjustment was contained in laws “governing the retirement
system or fund” and not subject to any exclusion in the Non-
Forfeitable Right Statute, the public employee retirees who have
brought suit are entitled to the pension benefits promised to
them. This ineluctable conclusion follows from the clear and
unambiguous language of the relevant statutes. The wording and
interconnection of those statutes do not suggest any other
plausible interpretation.
The PAA and each retirement system and fund guaranteed
public employees that, if they retired, their pension benefits
would be sustained by a periodic cost-of-living adjustment. In
making the critical decision of whether and when to retire,
public employees relied on the legislative promise that COLAs
would protect their pensions from the ravages of inflation.
Many public employees may not have retired or may have deferred
their retirement had COLAs not been guaranteed as part of their
pension benefits program. Although the Legislature had the
right to suspend COLAs for those public employees whose pension
benefits had not vested and who had yet to retire, it did not
have the right to do so for those public employees who retired
expecting that the State would keep its word. The Legislature
6
did here precisely what the United States and New Jersey
Constitutions prohibit: it passed a law impairing the
obligation of its own contract. See U.S. Const. art. I, § 10,
cl. 1.; N.J. Const. art. IV, § 7, ¶ 3.
I concur with the judgment of the Appellate Division, Berg
v. Christie, 436 N.J. Super. 220 (App. Div. 2014), which the
majority has overturned. The retired public employees in this
case are entitled to their full pension benefits earned over the
course of their careers. I therefore respectfully dissent.
I.
The first paragraph of the Non-Forfeitable Right Statute,
N.J.S.A. 43:3C-9.5(a), provides:
For purposes of this section, a “non-
forfeitable right to receive benefits” means
that the benefits program, for any employee
for whom the right has attached, cannot be
reduced. The provisions of this section shall
not apply to post-retirement medical benefits
which are provided pursuant to law.
The second paragraph, N.J.S.A. 43:3C-9.5(b), states:
Vested members of the Teachers’ Pension and
Annuity Fund, the Judicial Retirement System,
the Prison Officers’ Pension Fund, the Public
Employees’ Retirement System, the
Consolidated Police and Firemen’s Pension
Fund, the Police and Firemen’s Retirement
System, and the State Police Retirement
System, upon the attainment of five years of
service credit in the retirement system or
fund or on the date of enactment of this bill,
whichever is later, shall have a non-
forfeitable right to receive benefits as
provided under the laws governing the
7
retirement system or fund upon the attainment
of five years of service credit[.]
The majority reads the language of the second paragraph --
“the laws governing the retirement system or fund,” N.J.S.A.
43:3C-9.5(b) -- as referring only to the base pensions conferred
by each pension fund or system. (Emphasis added). With that
constricted view, the majority concludes that the legislative
contract formed in the Non-Forfeitable Right Statute extends no
further. That approach, however, requires that we put on
blinders to the provisions of the statutes in each retirement
system and fund that confer a cost-of-living adjustment to
retired public employees.
At the time of passage of the Non-Forfeitable Right
Statute, the laws governing each retirement system and fund
included specific provisions for the payment of COLAs to vested
and retired public employees. See N.J.S.A. 18A:66-18.1
(“Pension adjustment benefits for members and beneficiaries of
the Teachers’ Pension and Annuity Fund as provided by the [PAA]
shall be paid by the retirement system[.]” (citation omitted));
N.J.S.A. 43:6A-33.1 (“Pension adjustment benefits for members
and beneficiaries of the Judicial Retirement System provided by
the [PAA] shall be paid by the retirement system[.]” (citation
omitted)); N.J.S.A. 43:15A-24.1 (“Pension adjustment benefits
for members and beneficiaries of the Public Employees’
8
Retirement System provided by the [PAA] shall be paid by the
retirement system[.]” (citation omitted)); N.J.S.A. 43:16A-15.6
(“Pension adjustment benefits for members and beneficiaries of
the Police and Firemen’s Retirement System of New Jersey as
provided by [the PAA] shall be paid by the retirement system[.]”
(citation omitted)); N.J.S.A. 53:5A-34.2 (“Pension adjustment
benefits for members and beneficiaries of the State Police
Retirement System provided by the [PAA] shall be paid by the
retirement system[.]” (citation omitted)).10
The clear and unmistakable language of every statute above
provides for COLAs in a retirement system or fund in which
public employees are beneficiaries. Each of those statutes
directly incorporates the Pension Adjustment Act. The Non-
Forfeitable Right Statute and retirement system and fund
statutes when read together meet the high standard for a
legislative contract. See Spina v. Consol. Police & Firemen’s
Pension Fund Comm’n, 41 N.J. 391, 405 (1964) (stating that
“legislative contract” should be “so plainly expressed that one
2 Each of those statutory provisions also provides that COLAs
shall be funded as employer obligations. See, e.g., N.J.S.A.
18A:66-18.1 (“Pension adjustment benefits for members and
beneficiaries of the Teachers’ Pension and Annuity Fund as
provided by the [PAA] . . . shall be paid by the retirement
system and shall be funded as employer obligations by the same
method provided by law for the funding of employer obligations
for the basic retirement benefits provided by the retirement
system.” (citation omitted)).
9
cannot doubt the individual legislator understood and intended
it”).
The Legislature was familiar with the COLA retirement
benefit conferred by those statutes at the time of the enactment
of the Non-Forfeitable Right Statute. Mahwah Twp. v. Bergen
Cty. Bd. of Taxation, 98 N.J. 268, 279 (“The Legislature is
presumed to have been aware of existing legislation[.]”), cert.
denied, 471 U.S. 1136, 105 S. Ct. 2677, 86 L. Ed. 2d 696 (1985).
Those statutory provisions clearly show that COLAs were an
integral part of the benefits program provided to retired public
employees under various pension systems.
The majority’s approach, moreover, does not conform to the
logic of N.J.S.A. 43:3C-9.5. If section b’s reference to “laws
governing the retirement system or fund” encompassed nothing
more than a public employee’s right to the base pension pay,
then the Legislature would have had no need to exclude “post-
retirement medical benefits” provided by law from N.J.S.A.
43:3C-9.5’s benefits program. The majority’s interpretation
renders the exclusion superfluous. Yet, our canons of statutory
construction mandate that we give effect to all the words of a
legislative enactment. McCann v. Clerk of Jersey City, 167 N.J.
311, 321 (2001) (quoting Gabin v. Skyline Cabana Club, 54 N.J.
550, 555 (1969)).
In that light, the post-retirement medical benefits
10
exclusion is not mere surplusage. The Legislature clearly and
distinctly expressed that the employees’ benefits program
included more than base pension benefits by pointedly excluding
medical benefits. In other words, if the benefits program
mentioned in N.J.S.A. 43:3C-9.5(b) was limited to base pension
benefits, the Legislature would not have crafted the medical
benefits exclusion in N.J.S.A. 43:3C-9.5(a). See Prado v.
State, 186 N.J. 413, 426-27 (2006) (“[W]here a general provision
in a statute has certain limited exceptions, all doubts should
be resolved in favor of the general provision rather than the
exceptions[.]”) (quoting 2A Norman J. Singer, Sutherland
Statutory Construction § 47.11 (5th ed. 1992)).
Accordingly, the exclusion of only post-retirement medical
benefits from the Non-Forfeitable Right Statute clearly evinced
the Legislature’s intent to confer on retiring public employees
the remaining contractually promised post-retirement benefits --
the base pension and COLA.
II.
The cost-of-living adjustment has been a post-retirement
benefit for certain public employees since the passage of the
Pension Adjustment Act in 1958. See L. 1958, c. 143. In the
years that followed, the Legislature amended the PAA a number of
times, ingraining the COLA as a basic component of a pensioner’s
retirement benefits. See, e.g., L. 1977, c. 306, § 6
11
(increasing adjustment from one-half of percentage of change in
Consumer Price Index to three-fifths of percentage of change);
L. 1969, c. 169, § 1 (providing that adjustments would be based
on Consumer Price Index); L. 1964, c. 198, § 1 (applying COLA to
first $900 of retirement benefit). To place COLAs on a secure
financial footing, the Legislature required that employers pre-
fund COLAs, thus replicating the funding structure for base
pensions. See, e.g., L. 1990, c. 6 (Public Employees’
Retirement System); L. 1989, c. 204 (Police and Firemen’s
Retirement System); L. 1987, c. 385 (Teachers’ Pension and
Annuity Fund).
When the Legislature enacted the Non-Forfeitable Right
Statute, N.J.S.A. 43:3C-9.5, in 1997, which guaranteed that
vested public employees had a non-forfeitable right to post-
retirement benefits (other than medical benefits) “under the
laws governing the retirement system or fund,” public employees
reasonably believed that COLAs were an essential part of their
pension. That reasonable belief sprang from clear and
unmistakable statutory language. Public employees relied on
that language in deciding whether and when to retire.11 Without
3 The New Jersey Division of Pensions and Benefits published a
fact sheet explaining to members of the pension funds and
systems how to calculate COLAs and who to contact to verify
their current allowance and deduction information. N.J. Div. of
Pensions & Benefits, Fact Sheet #18: Cost-of-Living Adjustments
(Nov. 2005),
12
the guarantee of a cost-of-living adjustment, many public
employees may have determined that they would be unable to
financially support their families and may have postponed their
retirements.
In 2010, the Legislature limited the right to non-
forfeitable post-retirement benefits to those public employees
whose pension rights had become vested before May 21 of that
year. See L. 2010, c. 1. In 2011, the Legislature suspended
automatic COLAs for current and future retirees beginning June
28, 2011. L. 2011, c. 78, § 25 (codified as amended at N.J.S.A.
43:3B-2(a)).
No one doubts that the Legislature is empowered, and has
the duty, to make the State’s pension system fiscally sound.
But the United States and New Jersey Constitutions bar the
Legislature from unilaterally abrogating a contract it made with
its retired public employees. The various pension systems and
funds must honor the contractual right of those employees to
future cost-of-living adjustments under the Non-Forfeitable
Right Statute. The Federal and State Contracts Clauses prohibit
the state from impairing a contractual obligation. U.S. Const.
art. I, § 10, cl. 1. (“No State shall . . . pass any . . . Law
impairing the Obligation of Contracts[.]”); N.J. Const. art. IV,
http://www.njleg.state.nj.us/propertytaxsession/opi/fact18.pdf.
13
§ 7, ¶ 3 (“The Legislature shall not pass any . . . law
impairing the obligation of contracts, or depriving a party of
any remedy for enforcing a contract which existed when the
contract was made.”).12 Those clauses are limitations on
legislative power. New Jersey has waived its right to assert
sovereign immunity through the New Jersey Contractual Liability
Act. See Alden v. Maine, 527 U.S. 706, 755, 119 S. Ct. 2240,
2267, 144 L. Ed. 2d 636, 679 (1999) (“sovereign immunity bars
suit only in the absence of consent,” and therefore state may
waive its immunity under the Eleventh Amendment); Allen v.
Fauver, 167 N.J. 69, 75 (2001) (explaining that sovereign
immunity will not bar suit if there is “express legislative
consent to suit”). The Act provides:
The State of New Jersey hereby waives its
sovereign immunity from liability arising out
of an express contract or a contract implied
in fact and consents to have the same
determined in accordance with the rules of law
4 It bears noting that in 2006, the Office of Legislative
Services issued an opinion letter concluding that legislation
that would detrimentally alter the retirement benefits of
qualified retirees “would be unconstitutional as violative of
the federal and State constitutional proscription against
impairment of the obligation of contracts.” N.J. State Leg.,
Office of Legis. Servs., Opinion Letter on Reduction of
Retirement Benefits for Public Employees (Aug. 21, 2006),
http://www.njleg.state.nj.us/propertytaxsession/opi/jcpe_resourc
es_08232006.pdf. That letter also stated that the financial
instability of the system “was foreseeable at the inception of
the contractual relationship and the State, nevertheless,
committed itself and did not reserve the right to unilaterally
adopt substantial modifications of the pension program.” Ibid.
14
applicable to individuals and corporations;
provided, however, that there shall be no
recovery against the State for punitive or
consequential damages arising out of contract
nor shall there be any recovery against the
State for claims based upon implied warranties
or upon contracts implied in law.
[N.J.S.A. 59:13-3.]
Accordingly, the Legislature, pursuant to the Contractual
Liability Act, has waived immunity from suit for its violation
of its express contractual obligations to the retired public
employees in this case.13
Whatever reforms the Legislature enacts to ensure the
financial stability of the pension system must conform to the
Constitution. The promises made to public employees through the
Non-Forfeitable Right Statute meet the definition of a
legislative contract. That is so because the commitment made in
that statute is so plainly expressed that there can be no doubt
about the Legislature’s intent. See Spina, supra, 41 N.J. at
405.
III.
Unlike the majority, I conclude that public employee
plaintiffs in this case have an enforceable contractual right to
5 Employees and employers prefunded the COLA. See, e.g.,
N.J.S.A. 43:3B-4.3; N.J.S.A. 43:15A-24; N.J.S.A. 43:15A-24.1.
The payment of monies owed to retired public employees does not
require a legislative appropriation because those monies are in
a preexisting fund.
15
their COLAs. I therefore respectfully dissent.
16
SUPREME COURT OF NEW JERSEY
NO. A-71/72 SEPTEMBER TERM 2014
ON CERTIFICATION FROM Appellate Division, Superior Court
RICHARD W. BERG, ROBERT J. BRASS,
THOMAS CANNAVO, MELAINE B.
CAMPBELL, LARRY ROBERT ETZWEILER,
KATHY FLICKER, ARNOLD GOLDEN,
CHARLES GRINELL, TONI A. HENDRICKSEN,
HAROLD KASSELMAN, SUSAN LOTHIAN,
STEPHEN H. MONSON, MARTIN C. MOONEY,
SR., BRIAN MULHOLLAND, ANNE C.
PASKOW, SHARYN PEIFFER, SAMUEL REAL,
JR., GREGORY J. SAKOWICZ, SUSAN W.
SCIACCA, WILLIAM H. SCHMIDT, FRED
SCHWANWEDE, JOHN J. SMITH, DEBRA
STONE, SHERI TANNE, AND JACK L.
WEINBERG,
Plaintiffs-Respondents,
and
CHARLES OUSLANDER,
Plaintiff-Appellant
and Cross-Respondent,
and
NEW JERSEY EDUCATION ASSOCIATION,
NEW JERSEY STATE POLICEMEN’S
BENEVOLENT ASSOCIATION, INC.,
COMMUNICATIONS WORKERS OF
AMERICA, AFL-CIO, NEW JERSEY
FRATERNAL ORDER OF POLICE, NEW
JERSEY STATE FIREFIGHTERS’ MUTUAL
BENEVOLENT ASSOCIATION,
PROFESSIONAL FIREFIGHTERS
ASSOCIATION OF NEW JERSEY, AMERICAN
FEDERATION OF STATE, COUNTY AND
MUNICIPAL EMPLOYEES, COUNCIL 1, AFL-
CIO, AMERICAN FEDERATION OF STATE,
COUNTY AND MUNICIPAL EMPLOYEES,
COUNCIL 73, AFL-CIO, AMERICAN
FEDERATION OF TEACHERS NEW JERSEY
STATE FEDERATION, AFL-CIO,
INTERNATIONAL FEDERATION OF
PROFESSIONAL AND TECHNICAL
ENGINEERS, AFL-CIO & CLC, LOCAL 194,
INTERNATIONAL FEDERATION OF
PROFESSIONAL AND TECHNICAL
ENGINEERS, AFL-CIO, LOCAL 195,
INTERNATIONAL FEDERATION OF
PROFESSIONAL AND TECHNICAL
ENGINEERS, AFL-CIO & CLC, LOCAL 200,
PROBATION ASSOCIATION OF NEW
JERSEY, NEWARK FIREFIGHTERS UNION,
MORRIS COUNCIL NOS. 6 AND 6A, NJCSA
IFPTE, AFL-CIO, JERSEY CITY POLICE
OFFICERS BENEVOLENT ASSOCIATION,
CAMDEN COUNTY COUNCIL #10,
INTERNATIONAL BROTHERHOOD OF
TEAMSTERS LOCAL 97, BELLEVILLE PBA
LOCAL 28, NEW JERSEY ASSOCIATION OF
SCHOOL ADMINISTRATORS, NEW JERSEY
PRINCIPALS AND SUPERVISORS
ASSOCIATION, NEW JERSEY ASSOCIATION
OF SCHOOL BUSINESS OFFICIALS, NEW
JERSEY RETIREES’ EDUCATION
ASSOCIATION, TRANSPORT WORKERS
UNION LOCAL 225, NEW JERSEY SUPERIOR
OFFICERS LAW ENFORCEMENT
ASSOCIATION, ATLANTIC CITY WHITE
COLLAR PROFESSIONAL ASSOCIATION,
INTERNATIONAL BROTHERHOOD OF
ELECTRICAL WORKERS LOCAL 210,
ATLANTIC CITY SUPERIOR OFFICERS
ASSOCIATION, PETER BURKHALTER, DEE
TRUCHON, GEORGE O’BRIEN, THOMAS
TEVLIN, ROBERT BROWER, ROSEMARIE
JANKOWSKI, IRIS J. ELLIOTT, KENNETH D.
KING, FRANK ELMER HICKS, WILLIAM A.
PARKER, BRAD FAIRCHILD, DWIGHT
COVALESKIE, ANTHONY F. WIENERS, GARY
SOUSS, WILLIAM LAVIN, CHARLES WEST,
MARIAN LEZGUS, MELANIE HAFDELIN,
STEVEN ENGRAVALLE, CINDY BARR-
RAGUE, DOMINICK MARINO, JOHN J.
GEROW, JANET S. ZYNROZ, ALFRED
CRESCI, RAE C. ROEDER, MARYANN
PIUNNO SMITH, MARYANN MESICS, DENNIS
REITER, ANTHONY MISKOWSKI, VINCENT
KAIGHN, WILLIAM S. BAUER, JR., MICHAEL
CALABRESE, and DEBORAH JACOBS,
Plaintiffs/Intervenors-
Respondents,
v.
HON. CHRISTOPHER J. CHRISTIE, HON. KIM
GUADAGNO, SECRETARY OF STATE OF
THE STATE OF NEW JERSEY, DIRECTOR,
DIVISION OF PENSIONS, BOARD OF
TRUSTEES, PUBLIC EMPLOYEES’
RETIREMENT SYSTEM, TREASURER, STATE
OF NEW JERSEY AND STATE OF NEW
JERSEY,
Defendants-Respondents
and Cross-Appellants.
MICHAEL DELUCIA, PATRICIA DELUCIA,
ROBERT C. BROWN, AND ANNE K. BROWN,
Plaintiffs,
v.
STATE OF NEW JERSEY DEPARTMENT OF
THE TREASURY, DIVISION OF PENSIONS
AND BENEFITS,
Defendants.
DECIDED June 9, 2016
Chief Justice Rabner PRESIDING
OPINION BY Justice LaVecchia
CONCURRING/DISSENTING OPINION BY
DISSENTING OPINION BY Justice Albin
REVERSE AND
CHECKLIST DISSENT
REINSTATE
CHIEF JUSTICE RABNER X
JUSTICE LaVECCHIA X
JUSTICE ALBIN X
JUSTICE PATTERSON X
JUSTICE FERNANDEZ-VINA X
JUSTICE SOLOMON X
JUDGE CUFF (t/a) X
TOTALS 6 1