Illinois Supreme Court to Review Jurisdiction of Circuit Courts Over Pension Disputes

In the closing days of its May term, the Illinois Supreme Court allowed petitions for leave to appeal in five new civil cases. Our previews of those cases continue with People ex rel. Madigan v. Burge, a case which poses a jurisdictional question of potentially great importance: may the Attorney General challenge the actions of the Police Pension Board through a separate lawsuit in the Circuit Court, or are the Board’s actions subject to review only by routine administrative review?

Burge arises from a notorious case a few years ago involving a retired Chicago police officer. The officer was widely believed to have sanctioned and participated in the abuse and torture of arrestees in order to extract confessions. In 2010, the officer was convicted of two counts of obstruction of justice and one of perjury. The civil case arose from allegations that in responding to civil discovery, the officer had lied about his knowledge of abuse and torture of arrestees. The officer was sentenced to 54 months in prison.

Section 5-227 of the Pension Code provides that pension benefits may not be paid to anyone “convicted of any felony relating to or arising out of or in connection with his service as a policeman.”  The Board of Trustees of the Retirement Board of the Policemen’s Annuity and Benefit Fund held an evidentiary hearing to determine whether Section 5-227 barred any further pension payments to the imprisoned officer. At the conclusion of the hearing, the Board split 4-4 on whether to terminate payments to the officer: the four city-appointed trustees voting to terminate, the four trustees elected by the police officer participants in the pension fund voting to continue payments. The Pension Board concluded that a tie vote meant that benefits would continue, and issued a decision so holding.

Rather than seeking administrative review of the decision, the Attorney General sued the Board, seeking an injunction to halt the payments pursuant to section 5-227. The Attorney General cited section 1-115(b) of the Pension Code, which authorizes the Attorney General to sue to enjoin any practice which violates the Code, as giving standing for her suit. Both the Pension Board and the officer himself moved to dismiss the complaint, and the Circuit Court granted the motion.

The Appellate Court (First District, Sixth Division) reversed. The Court pointed out that the jurisdiction of the Circuit Courts was derived from the Illinois constitution, and as a result, could be limited or ousted only by express statutory language. Section 5-189 of the Pension Code provides that the Board has exclusive original jurisdiction over all matters “relating to or affecting the fund, including . . . all claims for annuities, pensions, benefits or refunds.” However, the Court noted, the statute said nothing about depriving the courts of jurisdiction over Section 5-227 suits by the Attorney General. Accordingly, the Circuit Court had jurisdiction to consider the Attorney General’s dec action.

The majority went on to briefly discuss the merits of the Pension Board’s decision. The Court noted that according to Section 5-182 of the Pension Code, no benefits could be paid out except on a majority vote of the Board. Since continuing the officer’s benefits had only received four of eight votes – obviously not a majority – the Board should have stopped the payments, according to the majority.

Justice Rodolfo Garcia specially concurred. Although Justice Garcia agreed with the principal conclusion of the majority opinion – that the Circuit Court had authority to hear the Attorney General’s declaratory judgment action – he found the suggestion that the Pension Code was violated by continuing payments following the 4-4 vote untenable. The only possible basis for the Attorney General’s claim, Justice Garcia argued, was the proposition that the officer’s felony conviction had in fact arisen from or in connection with his police service, making section 5-227 applicable.

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