No. 80-2-277, Appeal from the Order of Commonwealth Court dated March 12, 1980. No. 80-2-278 Appeal from the Order of Commonwealth Court dated March 13, 1980
Susan J. Forney, Allen C. Warshaw, Deputy Attys. Gen., Harrisburg, for appellant.
Ronald M. Katzman, Harrisburg, for Edward R. Miller.
Howard Gittis, Philadelphia, for Herbert Fineman.
O'Brien, C. J., files an Opinion in Support of Affirmance in which Flaherty, J., joins. Nix, J., files an Opinion in Support of Affirmance. Roberts, J., files an Opinion in Support of Reversal in which Larsen and Kauffman, JJ., join. Wilkinson, J., did not participate in the consideration or decision of this case. Roberts and Larsen, JJ., file a dissent from the denial of reargument.
The Court being equally divided, the Order of the Commonwealth Court is affirmed, 411 A.2d 1300.
Opinion IN SUPPORT OF AFFIRMANCE
Appellees, former Commonwealth of Pennsylvania employees, filed Petitions for Review invoking the original jurisdiction of Commonwealth Court, naming as respondent the State Employes' Retirement Board (Board). They challenged the constitutionality of the Public Employees Pension Forfeiture Act, Act 1978-140, 43 P.S. § 1311, et seq. (Act 140). Following the close of the pleadings the parties entered into stipulations of fact which provided the basis of subsequent motions for summary judgment. The motions were argued before Commonwealth Court, following which
the Court declared Act 140 unconstitutional as applied to appellees. The Board filed separate Notices to Appeal; the appeals were consolidated in June, 1980.
The stipulations of fact entered into by the parties clearly state that but for the retroactivity provision of Act 140, appellees met all applicable requirements for their pensions. Thus, there is no dispute that the pension entitlement had clearly vested under Pennsylvania law. A long line of Pennsylvania cases state that an employee's relationship with a government entity and its retirement system is contractual in nature. E.g., Dombrowski v. Philadelphia, 431 Pa. 199, 245 A.2d 238 (1968); Hickey v. Pittsburgh Pension Board, 378 Pa. 300, 106 A.2d 233 (1954). "At the time retirement pay becomes a vested right . . . it has ripened into a full contractual obligation." McBride v. Allegheny County Retirement Board, 330 Pa. 402, 405, 199 A. 130, 131 (1938).
Clearly, any attempt, including the retrospective application of Act 140, to terminate appellees' vested pension benefits (as stipulated by the parties) works an unconstitutional impairment of the obligation of contract.
I would affirm the Order of the ...