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Mattis v. State Universities Retirement System

June 02, 1998

BRIAN E. MATTIS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFF-APPELLANT,
v.
THE STATE UNIVERSITIES RETIREMENT SYSTEM, WILLIAM NORWOOD, INDIVIDUALLY, EMIL HAEFLINGER, INDIVIDUALLY AND STANLEY RIVES, INDIVIDUALLY, DEFENDANTS-APPELLEES.



The opinion of the court was delivered by: Justice Knecht

Appeal from Circuit Court of Champaign County

No. 95L222

Honorable George S. Miller, Judge Presiding.

In June 1993, plaintiff Brian E. Mattis filed an irrevocable election for early retirement from his position as a law professor at Southern Illinois University (SIU). The defendant State Universities Retirement System (System) informed plaintiff of the monthly payment he would receive from his annuity. Plaintiff challenged the amount of that payment. Following a hearing, the System concluded article 15 of the Pension Code (Code) (40 ILCS 5/15-101 et seq. (West 1992)), particularly section 15-136.2 (40 ILCS 5/15-136.2 (West 1992)), mandated the monthly annuity payment it determined for plaintiff. Plaintiff disagreed, arguing the System misinterpreted the statutes. Plaintiff filed suit in the circuit court of Champaign County seeking administrative review of the System's decision, as well as seeking relief through the court's original jurisdiction.

The circuit court agreed with the System's interpre-tation. On April 29, 1996, the circuit court dismissed the counts seeking the original jurisdiction of the circuit court. The circuit court reserved an equal protection argument added to count I, the count seeking administrative review. On August 6, 1997, the circuit court confirmed the agency's decision. Plaintiff appeals, arguing (1) the System and the circuit court misinterpreted the Code, resulting in a surplus of funds for the System, and (2) the circuit court improperly dismissed the remaining counts. We agree with plaintiff's interpretation of the Code and reverse.

I. BACKGROUND

Plaintiff opted for early retirement, signing an "irrevocable" election to have his "retirement annuity processed under the Early Retirement Incentive pursuant to Section 15-136.2" (40 ILCS 5/15-136.2 (West 1992)). Plaintiff estimated his monthly retirement income would be approximately $3,600 per month. Plaintiff learned the System determined his retirement income to be approximately $2,800 per month. He requested his resignation be rescinded, but SIU denied his request.

In a March 3, 1994, letter, SIU offered plaintiff a payment of $60,558, if he would waive the early retirement option (ERO). If plaintiff accepted, SIU would have been relieved of expending the early retirement payment of $122,929. SIU explained to plaintiff under the ERO he would receive an additional estimated $144 per month after taxes. With a waiver and $60,558, plaintiff could earn $216 per month by purchasing a tax-deferred annuity from Aetna.

Plaintiff informed the System of SIU's offer and proposed the transfer of the funds contributed to the System by SIU to his individual retirement account (IRA). The System's attorney contacted plaintiff via April 19, 1994, letter, to inform him the System could not apply the employer's contribution to his IRA and his claim would be forwarded for administrative review by the claims committee.

The System, in a letter dated August 24, 1994, informed plaintiff the value of his account as of May 31, 1994, was $329,935.42. This amount did not include the $122,928.60 SIU paid pursuant to section 15-136.2. The letter also informed plaintiff his annuity under the general formula (Rule 1) amounted to $2,815.98, and the money purchase amount (Rule 2) was $2,586.37. See 40 ILCS 5/15-136(a) (West 1992). Prior to the ERO, plaintiff had an annuity of approximately $2,090 under Rule 1, and an annuity of approximately $2,600 under Rule 2.

On August 29, 1994, a hearing was held before the System's claims committee. The claims committee considered whether "the [System should] include the $122,928.60 employer [ERO] payment in the calculation of retirement benefits under Section 5/15-136 Rule 2." A statement provided by the System to plaintiff estimated his monthly annuity at age 60 would have been $3,640. The System assisted in "fine-tuning the language" of section 15-136.2 of the Code. By letter dated December 22, 1994, the claims committee denied plaintiff's appeal. The executive committee concurred in that decision.

On February 16, 1995, plaintiff filed a six-count complaint in the circuit court of Champaign County against the System and three members of the System's executive committee. Plaintiff sought administrative review of the executive committee's decision and set forth other claims in the circuit court's original jurisdiction. Both plaintiff and the System filed briefs on the issue of statutory interpretation. On January 17, 1996, the circuit court ruled in the System's favor on the issue of statutory interpretation.

Plaintiff amended his complaint on February 15, 1996, to add a number of facts and an additional count. (Plaintiff abandoned counts III and V.) Count I was amended to add an equal protection argument. In addition to the statutory interpretation argument, plaintiff contended the irrevocable clause was not applied to everyone equally, as individuals had been permitted to revoke their election. Count II set forth a claim for the equitable action of an accounting and included the equal protection argument in count I. Count IV was almost identical to count II, but sought the remedy of a constructive trust. In count VI, plaintiff maintained his civil rights were violated. In count VII, plaintiff alleged a claim of economic duress.

At a hearing on April 29, 1996, the circuit court considered the System's motion to dismiss as a section 2-615 motion (735 ILCS 5/2-615 (West 1996)). The circuit court denied the System's motion to dismiss the equal protection argument added to count I, but granted the motion dismissing the remaining counts. The circuit court concluded the equal protection argument need not be considered for counts II and IV. The circuit court concluded because the System's interpretation of the Code was correct, the other issues in counts II and VI were dismissed. The circuit ...


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