Appeal from the Order of the Court of Common Pleas of Allegheny County in case of Adrian Fedor v. The Borough of Dormont; William H. Moreland, Jr., Mayor; Thomas J. Torchia, Thomas V. McAllister, James W. Connor, Thomas R. Lloyd, Nicholas Masterson, Steve Pietrocatello and Billy Reiche, Members of Council, No. 1785 January Term, 1975.
Phillip D. Paull, for appellants.
Ronald P. Koerner, and Gatz, Cohen, Segal & Koerner, for appellees.
Robert F. Meehan, with him Craig R. Burgraff, Deputy Counsel, and Lester Eisenstadt, Deputy Auditor General and Chief Counsel, for amicus curiae, Department of Auditor General.
Judges Wilkinson, Jr. and Rogers, sitting as a panel of two. President Judge Bowman and Judges Crumlish, Jr., Wilkinson, Jr., Mencer, Rogers, Blatt and DiSalle. Opinion by Judge Rogers.
[ 36 Pa. Commw. Page 450]
The Borough of Dormont (Borough) has appealed from an order of the Court of Common Pleas of Allegheny County requiring the Borough to purchase with funds of its Police Pension Plan a $5000 paid-up insurance policy on the life of Adrian Fedor, a retired police officer.
Mr. Fedor retired from the police force of the Borough of Dormont on February 28, 1974. He thereupon requested the Borough to purchase a $5000 paid-up insurance policy on his life as part of his pension benefits. The Borough refused the appellee's request on the basis of an opinion of the State Auditor General that the purchase of a single premium post-retirement life insurance policy from the Borough's Police
[ 36 Pa. Commw. Page 451]
Pension Fund was unauthorized by the governing legislation, the Act of May 29, 1956, P.L. (1955) 1804, as amended, 53 P.S. § 767 et seq. The appellee brought suit in mandamus against the Borough, the Mayor and members of Borough Council. After a trial before a judge without a jury final judgment was entered requiring the Borough to provide the insurance policy requested by purchase with "funds from the police pension fund." This appeal followed.
The Act of May 29, 1956 just cited requires certain municipal subdivisions, including boroughs, to establish a police pension fund to be maintained by charges against members, appropriations by the municipalities and monies received from the State from taxes paid upon premiums by foreign casualty insurance companies. In compliance with the Act, the Borough of Dormont enacted its ordinance No. 949 in or about September of 1957. This ordinance created what it calls an Insured Police Pension Fund. The Fund provided for monthly retirement pension benefits for retired police officers and for the beneficiaries of officers dying before retirement. It contained no provision for death benefits, nor does it mention the appointment of any insurance company as carrier for the Fund.
On January 4, 1965 Borough Council adopted a resolution, a preamble of which expresses the Borough's desire to continue the Pacific Mutual Life Insurance Company as carrier and actuary "for the assured plan and its increased Death and Disability Benefits" and which records the Borough's desire "to ratify and confirm the authorized increase of the Death and Disability benefits in accordance with the recommendations of the Pacific Mutual Life Insurance Company." An operative section ...