No. 81-1-36, Appeal from the Order of Commonwealth Court dated June 27, 1980, at No. 313 C.D. 1979, No. 3 M.D. Appeal Docket, 1982, Appeal from the Order of Commonwealth Court dated February 3, 1982, at No. 792 C.D. 1981.
Susan J. Forney, Allen C. Warshaw, Deputy Attys. Gen., Harrisburg, for appellant.
Gregory L. Heidt, Falcone & Eppinger, Erie, Charles Golden, Barsky, Golden & Remick, Sharlyn B. Cohen, Philadelphia, for appellee.
O'Brien, C. J., and Roberts, Nix, Larsen, Flaherty and McDermott, JJ. Hutchinson, J., did not participate in the consideration and decision of these cases. Nix, J., files a concurring opinion in which McDermott, J., joins. Roberts, J., files a dissenting opinion in which Larsen, J., joins.
Appellees, Robert E. Bellomini and Henry J. Cianfrani, former employees of the Commonwealth of Pennsylvania, challenged the denial of their retirement benefits by the State Employees' Retirement Board (hereinafter "Board") by filing Petitions for Review invoking the original jurisdiction of the Commonwealth Court of Pennsylvania. Appellees attacked the constitutionality of the Public Employee Forfeiture Act, Act 1978-140, 43 P.S. § 1311 et seq. (herein-after "Act 140"). Appellee Cianfrani had been receiving a monthly retirement allowance, which was terminated pursuant to Act 140. Appellee Bellomini's retirement benefits were denied, also pursuant to Act 140, when he applied for them. In both cases the Commonwealth Court directed the Board to enforce appellees' contractual retirement benefits rights. These appeals followed.
I. The Case of Appellee Bellomini
Robert Bellomini was a member of the House of Representatives of the Commonwealth of Pennsylvania for fourteen years, from December 1, 1964, until his resignation on June 14, 1978. Ten days before his resignation, appellee was convicted of two counts of unlawfully obstructing, delaying and affecting interstate commerce by extortion, in violation of 18 U.S.C. § 1951.
During his tenure as a state representative, Appellee Bellomini, a member of the State Employees' Retirement System (hereinafter "System"), contributed $20,714.87. On August 1, 1978, he applied for a state retirement allowance. By letter dated August 22, 1978, the Board informed Bellomini that his retirement benefits were denied based upon Act 140. Bellomini's contributions to the System, excluding interest, were returned by the Board on January 22, 1979. On February 12, 1979, Appellee Bellomini filed his Petition for Review in the Commonwealth Court. That court, on January 27, 1980, entered an order enjoining the Board from withholding Bellomini's retirement benefits. The Board filed its Notice of Appeal to this Court Nunc Pro Tunc on May 11, 1981.
II. The Case of Appellee Cianfrani
Henry Cianfrani was a Commonwealth employee for approximately eighteen years. He was employed by the Pennsylvania Department of Revenue from May 4, 1959, until November 30, 1962. Subsequently, from December 1, 1962, until November 30, 1966, Cianfrani was a member of the Pennsylvania House of Representatives. Following his tenure in the House, Cianfrani was a member of the Senate of the Commonwealth of Pennsylvania for eleven years, from December 1, 1966, until his resignation on December 15, 1977. Throughout this eighteen-year period, Appellee Cianfrani, as a member of the System, contributed $28,404.48.
Upon his resignation in December, 1977, Cianfrani applied for retirement benefits. He received his personal contributions in a lump sum payment and concurrently began receiving a monthly allowance. On December 30, 1977, Cianfrani entered pleas of guilty to racketeering, in violation of 18 U.S.C. § 1962(c), mail fraud, in violation of 18 U.S.C. § 1341, and obstruction of justice, in violation of 18 U.S.C. § 1503, and a plea of nolo contendere to tax evasion, in violation of 26 U.S.C. § 7201, in the United States District Court for the Eastern District of Pennsylvania.
By letter dated August 23, 1978, Appellee Cianfrani was notified that since his retirement benefits had been terminated pursuant to Act 140, health insurance coverage had been cancelled. On April 9, 1981, Cianfrani filed his Petition for Review in the Commonwealth Court challenging the constitutionality of Act 140. On February 3, 1982, based upon Burello v. State Employes' Retirement System, 49 Pa. Commonwealth Ct. 364, 411 A.2d 852 (1980), and Miller and Fineman v. State Employees' Retirement System, 498 Pa. 103, 445 A.2d 88 (1981), the Commonwealth Court granted Cianfrani's motion for summary judgment and ordered the Board to restore his retirement benefits. The Board filed its Notice of Appeal to this Court on February 9, 1982. The cases were consolidated for appeal upon Appellee Cianfrani's petition.
III. The Retroactive Application of Act 140 Effects an Unconstitutional Impairment of the Obligation of Contract
Act 140 provides, in pertinent part,
"Section 3. Disqualification and forfeiture of benefits.
"(a) Notwithstanding any other provision of law, no public official or public employee nor any beneficiary designated by such public official or public employee shall be entitled to receive any retirement or other benefit or payment of any kind except a return of the contribution paid into any pension fund without interest, if such public official or public employee is convicted or pleads guilty or no defense to any crime related to public office or public employment.
"(b) The benefits shall be forfeited upon entry of a plea of guilty or no defense or upon initial conviction and no payment or partial payment shall be made during the pendency of an appeal . . . Such conviction or plea shall be deemed to be a breach of a public officer's or public employee's contract with the employer.
"Section 6. Severability.
"The provisions of this act shall be severable. If any provision of this act or the application thereof to any person or circumstance is held invalid, the remainder of the statute, and the application of such provision to other persons or circumstances, shall not be affected thereby, unless the court finds that the valid provisions of the act are so essentially and inseparable connected with, and so depend upon, the void provision or application, that it cannot be presumed the General Assembly would have enacted the remaining valid provisions without the void one; or unless the court ...