Appeal from an order of the Commonwealth Court of Pennsylvania entered March 6, 1985, at Nos. 3008 and 3086 C.D. 1980 on remand from an order of the Supreme Court of Pennsylvania at Nos. 66 and 67 E.D. 1982 entered December 30, 1983 affirming in part and reversing in part a prior order of the Commonwealth Court entered December 31, 1981 affirming in part and reversing in part the order of the Court of Common Pleas of Delaware County at No. 6023 of 1975 entered November 13, 1980.
Nix, C.j., and Larsen, Flaherty, McDermott, Zappala and Papadakos, JJ. Larsen, J., filed a concurring and dissenting opinion in which Papadakos, J., joined.
We granted cross-petitions for allowance of appeal to review the arbitration award granting non-service disability pension benefits in the amount of 65 percent of a police officer's monthly salary and reducing the minimum age for retirement from 55 to 53 upon completion of an actuarial study. The trial court reversed the award with regard to the percentage of pension benefits payable and in the reduction of the minimum age for retirement without the arbitrators first considering an actuarial study, but affirmed the award in granting pension benefits to a policeman not injured in the course of his employment. Commonwealth Court affirmed. 88 Pa. Commw. 120, 488 A.2d 1180 (1985).
The facts are not in dispute. Pursuant to § 217.1 of the Collective Bargaining Act, Act of June 24, 1968, P.L. 237, No. 111, 43 P.S. § 217.1 et seq., a board of arbitrators was empaneled in the Fall of 1974 following an impasse in negotiations between the Newton Township Police Department and Board of Supervisors. Upon due consideration, the arbitration panel determined for calendar year 1975 that any officer permanently and totally disabled whether service or non-service related was entitled to receive 65 percent of his salary as a pension until his death. Because the township would not implement this provision on the grounds that this provision was illegal and unenforceable, the police department instituted an action in mandamus in Common Pleas Court. Thereafter, in 1975 another impasse occurred. Another panel was commissioned under § 217.1
of the Act resulting in an award reducing the retirement age from 55 to 53 after 25 years of service after the completion of an actuarial study the cost of which was to be borne by the township. The complaint in mandamus was amended to include the disagreement over the 1976 award. As previously indicated, the trial court, as well as the Commonwealth Court, affirmed in part and reversed in part the 1975 and 1976 arbitration awards. We granted allocatur to determine the proper interpretation of § 771 of the Police Pension Fund Act (Act 600) Act of May 29, 1956, P.L. (1955) 1804, 53 P.S. § 771 and now affirm in part and reverse in part.
Disposition of this appeal relies upon the proper interpretation to be given to § 771 of Act 600. The first issue raised under this section is whether a pension is permissible for a disability not incurred during the course of a policeman's employment. Nothing in § 771 explicitly permits or prohibits the payment of such a pension. In City of Washington v. Police Department of Washington (Washington Arbitration Case), 436 Pa. 168, 259 A.2d 437 (1969), we held that an arbitration award may not require the implementation of an illegal act, nor require a public employer to do that which it cannot do voluntarily. However, implicit in the analysis of determining an illegal act is consideration of the authority to act. For if a public employer has no authority to act, any action by the public employer may be an illegal act.
Section 767 of Act 600 provides that benefits may be paid to a member of the police force who, "shall receive honorable discharge therefrom by reason of age and service, or disability . . .", 53 P.S. 767. The Act clearly contemplates the payment of a disability pension. It does not, however, articulate whether the disability must be the result of an injury suffered during the course of one's employment (i.e. service v. non-service disability) before triggering the payment of pension benefits.
The first paragraph of § 771 of Act 600 provides for the creation of an autonomous fund and sets forth that
pension benefits based upon service and age shall be calculated in accordance with paragraph two.
Payments made under the provision of this Act shall not be a charge on any other fund in the treasury of any borough, town or township, or under its control, save the police pension fund herein provided for. The basis for determining any pension payable under this act, following retirement of any member of the force meeting the service and age qualifications of the ordinance or resolution establishing a pension fund, shall be as follows:
53 P.S. § 771. After setting forth the calculations and limitations on pension benefits, the following provision regarding service related ...