Submitted: December 11, 2013
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE BERNARD L. McGINLEY, Judge HONORABLE BONNIE BRIGANCE LEADBETTER, Judge HONORBLE RENÉE COHN JUBELIRER, Judge HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE P. KEVIN BROBSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge
DAN PELLEGRINI, President Judge
Kimberly Ann Dale-Dambeck (Surviving Spouse) appeals from an order of the Court of Common Pleas of Blair County (trial court) finding her ineligible for surviving spouse pension benefits from the City of Altoona (City) Paid Firemen's Pension Fund Association (Association). The sole issue in this case is whether William Dambeck (Dambeck), Surviving Spouse's husband, died while "on pension" within the meaning of Section 4320 of the Third Class City Code (Code).
Surviving Spouse's husband left his employment as a firefighter for the City on September 16, 2005, after 13 years of service. Because he had been with the City Fire Department (Department) for more than 12 years but less than 20 years,  Dambeck exercised the option to vest his pension. Under this option, he would begin collecting pension payments when he reached the date at which he would have been eligible to retire had he remained with the Department.However, Dambeck died on March 27, 2008, and, therefore, never received a pension payment.
On March 21, 2012, nearly four years after her husband died, Surviving Spouse filed an application for surviving spouse pension benefits with the City of Altoona Paid Fireman's Pension Fund (Pension Fund). Because it believed that nothing in Section 4320.1 of the Code implementing the ordinance and Agreement provided guidance as to whether a surviving spouse was entitled to benefits where the participant died after vesting but prior to the 20-year entitlement date,  the City filed a declaratory judgment action seeking a determination as to whether Surviving Spouse had the right to a surviving spouse pension under Section 4320 of the Code which provides for "payments to surviving spouses of members retired on pension or killed or who die in the service." 53 P.S. §39320.
Before the trial court, Allen Wagner (Wagner), who served on the Pension Board (Board) from 1985 through December 2010, most recently as its secretary, testified that Dambeck "left the department in its good graces and vested his pension benefits" in 2005. (R.R. at 10a.) He said that when Dambeck died in 2008, he reviewed the Agreement and informed the Board that he believed Surviving Spouse should receive the same benefits Dambeck would have received if he had been receiving pension benefits when he died, since widows of vested members had long been recognized as recipients of benefits. Wagner also said that around the time Dambeck died, he informed Surviving Spouse that he believed she should wait until her husband would have been eligible for pension benefits and apply for widow's benefits at that time. He said that the other members of the Board agreed with him so no one saw any need for action on the matter. Wagner further testified that he left the Board in 2010 so he had no part in any discussions or actions taken when Surviving Spouse actually applied for widow's benefits. He also agreed with the parties' Stipulation that the Agreement provides for a 12-year vesting principle, not the bylaws, but the bylaws have been incorporated into the Agreement by reference. He finally said that this is the first time he had encountered an instance where a member vested his benefits and passed away before beginning to receive them.
On cross-examination, Wagner testified that the 12-year vesting right was provided for in the Agreement, which previously required 20 years of service before a member's benefits vested. He further said that his discussion with the other Board members as to Surviving Spouse's situation and whether the Board believed she was entitled to surviving spouse benefits was "sort of  informal, " (R.R. at 27a), but that the Board agreed that she should be entitled to the benefits. Wagner believed that he was acting within his capacity as secretary of the Board in informing Surviving Spouse that she should wait and apply for benefits at what would have been her husband's 20-year anniversary with the Department which the Board believed was the appropriate time.
Based upon the testimony and evidence presented at trial and upon the Stipulation which the court incorporated into its opinion by reference, the trial court found that while no formal vote was ever taken, the members of the Board were in agreement with Wagner as to Surviving Spouse's eligibility to receive widow's benefits. Nonetheless, the trial court held that Surviving Spouse was not entitled to collect surviving spouse benefits because her husband was not retired and collecting a pension or did not die while he was employed by the Department as required by Section 4320 of the Code. The court based its decision, in part, on the Supreme Court of Pennsylvania's decision in In re Appeal of Stanton, 499 Pa. 151, 154, 452 A.2d 496, 497 (1982), in which the Court held that "a firefighter's widow's right to pension benefits is not derivative" of her husband's right to benefits, so the fact that Surviving Spouse's husband's right to pension benefits had vested had no bearing on her eligibility to collect surviving spouse benefits. While recognizing that one of the Supreme Court's intentions was to protect surviving widows, the trial court then went on to state:
In conclusion, the Pennsylvania Supreme Court in Stanton held that a fire fighter's widow's rights to pension benefits is not derivative, and the deceased fire fighter's ineligibility for retirement benefits does not affect his widow's independent statutorily conferred right to benefits. [499 Pa. at 154, ] 452 A.2d at 497.
In Stanton, the fire fighter died after only four years' service, and was not yet entitled to pension benefits in that he had not satisfied the service nor the age requirements of the pension plan. There is one important fact, however, in Stanton that distinguishes that case from the one before the court. On the date of his death, Mr. Stanton was employed by the City of Easton Fire Department. Therefore, his widow fell within the class of persons the legislature intended to protect, i.e., she was a widow of a member who "died in the service, " interpreted by the court to mean a member who dies while employed by a fire department (emphasis added). [499 Pa. at 155, ] 452 A.2d at 498. In our case, as of the date of his death, it is undisputed that Mr. Dambeck was not employed by the City of Altoona Fire Department.
(Trial Court 2/1/13 Opinion at 7) (emphasis in original.) This appeal followed.
On appeal, Surviving Spouse contends that although her husband was not receiving pension benefits when he died, he was still "retired on pension" when he left his employment as a City firefighter. The issue then becomes whether "retired on pension" means that the decedent spouse must be receiving actual pension benefit payments or must only be entitled to benefits at a fixed, certain date.
The Code provides, in relevant part, that third-class cities shall establish a firemen's pension fund to which each member of a city's fire department must contribute to provide for members' pensions, as well as "payments to surviving spouses of members retired on pension or killed or who die in the service." 53 P.S. §39320. Section 4322 of the Code provides that surviving spouses are to be paid the amount the member was receiving or would have been receiving at the time of his or her death. 53 P.S. §39322. A city's ordinance may provide for a limited vesting benefit, whereby a member may vest his benefits after 12 years of full-time service, and that member will begin receiving pension benefits when he ...