Case Title: Albert Loth v. City of Milwaukee

Citation: 2008 WI 129

Docket Number: 2007AP000587

State: wisconsin

Court: Wisconsin Supreme Court

Date: 2008-12-30T00:00:00Z

Document:
2008 WI 129 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2007AP587 
COMPLETE TITLE: 
 
 
Albert Loth, 
          Plaintiff-Appellant, 
     v. 
City of Milwaukee, 
          Defendant-Respondent-Petitioner. 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
2008 WI App 12 
Reported at: 307 Wis. 2d 412, 745 N.W.2d 693 
(Ct. App 2008-Published) 
 
 
OPINION FILED: 
December 30, 2008   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
November 4, 2008   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Milwaukee   
 
JUDGE: 
Patricia D. McMahon   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
        
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the defendant-respondent-petitioner there were briefs 
by Alan M. Levy and Lindner & Marsack, S.C., Milwaukee, and oral 
argument by Alan M. Levy. 
 
For the plaintiff-appellant there was a brief by James W. 
Greer, Jr., Barbara J. Janaszek, and Whyte Hirschboeck Dudek 
S.C., Milwaukee, and oral argument by James W. Greer, Jr. 
 
 
 
 
2008 WI 129
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
 
No.  2007AP587    
(L.C. No. 
2005CV11346) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Albert Loth,   
 
 
Plaintiff-Appellant,   
 
 
v. 
 
City of Milwaukee,   
 
 
Defendant-Respondent-Petitioner.   
FILED 
 
DEC 30, 2008 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Reversed.   
 
¶1 
SHIRLEY S. ABRAHAMSON, C.J.   The City of Milwaukee 
seeks review of a published court of appeals decision reversing 
an order and judgment of the Circuit Court for Milwaukee County, 
Patricia D. McMahon, Judge.1  The circuit court granted summary 
judgment to the City and dismissed Albert Loth's complaint. 
¶2 
The single issue posed on review is which City health 
insurance plan covers Loth, who had 15 years of service with the 
City in 1999, reached the age of 60 in 2005, and retired in 
2005:   
                                                 
1 Loth 
v. 
City 
of 
Milwaukee, 
2008 
WI 
App 
12, 
307 
Wis. 2d 412, 745 N.W.2d 693. 
No. 
2007AP587    
 
2 
 
(1) 
The pre-2004 City health insurance plan, which 
provided for no-premium-cost health insurance for 
City employees between ages 60 and 65 with 15 
years of service who retired from City service; or 
(2) 
The post-2004 City health insurance plan (enacted 
in 2002 to take effect in 2004), which provides 
for shared-premium-cost health insurance for City 
employees between ages 60 and 65 with 15 years of 
service who retire from City employment after 
January 1, 2004.   
¶3 
Loth contends that he is entitled to the pre-2004 no-
premium-cost health insurance upon retirement because the pre-
2004 no-premium-cost provision was in effect when he completed 
15 years of service with the City in 1999.  Loth's position is 
that when a management employee completes 15 years of service 
the employee is entitled to the no-premium-cost provision under 
the health insurance benefit in effect at that time, even if the 
management employee has not attained the specified retirement 
age and has not retired.  In sum, Loth argues that although he 
could not receive a retiree's health insurance benefit until he 
retired at age 60, he earned the retiree benefit upon his 
completion of 15 years of service.  According to Loth, attaining 
the retirement age of 60 and retiring are mere conditions 
precedent to receipt of the free health insurance benefit.  
¶4 
In contrast, the City contends that Loth is entitled 
to the post-2004 shared-premium-cost health insurance because 
Loth did not attain the age of 60 and did not retire until 2005 
No. 
2007AP587    
 
3 
 
when the post-2004 resolution was in effect for persons who 
retired after January 1, 2004.2 
¶5 
The only point of dispute between Loth and the City is 
whether Loth has to pay a premium for the health insurance 
benefit.  Loth wants all the health insurance options and 
benefits available to retirees each year but wants them 
according to what he views as the City's promise that he would 
be entitled to the no-premium-cost health insurance benefits in 
effect when he was in City service for 15 years. 
¶6 
We agree with the City and the circuit court: The pre-
2004 City health insurance plan does not govern Loth's health 
insurance on his retirement in 2005.  The pre-2004 City health 
insurance plan clearly provided health insurance to management 
employees who met three qualifications: The management employee 
had to retire; had to be between the ages of 60 and 65; and had 
to have 15 or more years of city service.3  Before 2004, Loth had 
met only one of the pre-2004 qualifications for no-premium-cost 
health insurance: he had 15 years of employment with the City.  
Loth had neither attained the age of 60 nor retired when the 
                                                 
2 After the 2002 Resolution went into effect in 2004, a free 
HMO plan was still in existence.  The free HMO plan provided 
Loth with no benefits because Loth was planning to move to 
Florida.  To be eligible for the free HMO plan, the retiree had 
to reside in designated counties in southeastern Wisconsin.   
3 One resolution in the circuit court record also suggests 
that employees had to retire with an unreduced "retirement 
allowance."  The parties, however, do not address the issue 
whether Loth had, or needed to have, an unreduced retirement 
allowance in order to qualify for the health insurance benefit. 
No. 
2007AP587    
 
4 
 
pre-2004 health insurance plan was in effect.  Thus Loth had not 
satisfied all three requirements under the pre-2004 health 
insurance plan before the health insurance plan was amended to 
take effect in 2004.  
¶7 
Accordingly, Loth's health insurance plan is governed 
by the post-2004 City resolution that was in effect when Loth 
became 60 years of age and retired with more than 15 years of 
service with the City.  
¶8 
We therefore reverse the decision of the court of 
appeals and affirm the order and judgment of the circuit court 
granting summary judgment to the City and dismissing Loth's 
complaint.   
I 
¶9 
We review the circuit court's grant of summary 
judgment in the present case independently, applying the same 
methodology that is used by the circuit court.4  Summary judgment 
is appropriate when there is no genuine issue of material fact 
and the moving party is entitled to judgment as a matter of law.5  
There is no genuine issue of material fact in the instant case.   
¶10 The present case raises only a question of law, namely 
the interpretation and application of a municipal resolution to 
undisputed facts.  This court determines this legal question 
                                                 
4 Novell v. Migliaccio, 2008 WI 44, ¶23, 309 Wis. 2d 132, 
749 N.W.2d 544 (citation omitted).   
5 Wis. Stat. § 802.08(2). 
No. 
2007AP587    
 
5 
 
independently of the circuit court and court of appeals but 
benefitting from their analyses.6   
II 
 
¶11 The relevant facts of Loth's employment are not 
disputed.  The City hired Loth as an accountant on November 19, 
1984.  He was a management employee and was not covered by any 
collective bargaining agreement between the City and its 
employees.  By November 1999 he had been in the City's service 
for 15 years.  He did not attain the age of 60 or retire until 
April 2005.   
¶12 Upon Loth's retirement on April 25, 2005, the City 
provided him with health insurance benefits according to the 
terms of a 2002 City of Milwaukee Resolution effective for 
employees who retire on or after January 1, 2004.  The City 
deducted health insurance premiums from his retirement check.  
Loth objects to the City's deducting the premiums.   
¶13 Loth contends that a binding contract was formed 
between him and the City in 1999 when he completed his 15th year 
of service to the City, that under that contract the City is 
obligated to provide no-premium-cost health insurance to him 
                                                 
6 Bruno 
v. 
Milwaukee 
County, 
2003 
WI 
28, 
¶6, 
260 
Wis. 2d 633, 660 N.W.2d 656. 
See also Cross v. Soderbeck, 94 Wis. 2d 331, 343, 288 
N.W.2d 779 (1980) ("The only substantial difference between a 
resolution and an ordinance apart from the subject to which it 
shall apply is that one is required to be published subsequent 
to its passage and the other is not.") (quotation marks and 
citation omitted).  
No. 
2007AP587    
 
6 
 
under the health insurance plan in effect in 1999, and that the 
City cannot alter this 1999 no-premium-cost agreement.  
¶14 Loth brought an action against the City, alleging that 
the City had breached its contract with Loth by refusing to 
provide him with free health insurance benefits according to the 
terms of the plan that was in effect in 1999 when he had put in 
his 15 years of service.7  To prevail on a breach of contract 
theory, Loth must establish that a contract exists, the terms of 
the contract, and the breach of a duty under the contract.  In 
the instant case, the City has made a unilateral offer of health 
insurance benefits that requires an employee to perform the 
requested acts to accept the offer and give rise to a binding 
contract.  
¶15 Both parties moved for summary judgment.  The circuit 
court granted summary judgment to the City.  A divided court of 
appeals reversed the circuit court's order granting summary 
judgment to the City and remanded the cause to the circuit court 
for a determination of Loth's damages and a declaration of 
Loth's rights.  
 
¶16 The precise wording of the applicable City resolution 
in effect in 1999 governing a retiree's health insurance 
benefits is not in the record.  We shall rely on the resolutions 
and handbooks that the parties recite and upon which they rely.  
We therefore start by examining the applicable documents for the 
                                                 
7 Loth abandoned his claim of promissory estoppel on appeal.  
Loth, 307 Wis. 2d 412, ¶7 n.2.   
No. 
2007AP587    
 
7 
 
terms of the City's unilateral offer of health insurance 
benefits.   
¶17 Loth and the City agree that City of Milwaukee 
Resolution 020479, enacted on July 16, 2002 (and effective in 
2004), accurately describes the substance of the City's health 
insurance plan in effect in 1999 as providing no-premium-cost 
health insurance to certain retirees.  The Resolution states in 
one of its "whereas" clauses that the City "currently provides 
that General City Management employees who select retirement, 
those 55 years of age with 30 years of service or those 60 years 
of age with 15 years of service, can select any health insurance 
plan the City offers at no cost until they reach age 65 . . . ."8 
 
¶18 This language explicitly states that a management 
employee has to select retirement to get no-premium-cost City 
health insurance. In addition, the management employee also has 
to be 60 years of age, with 15 years of service.  This reading 
of the City's plan is also supported by various documents in the 
record that both parties recite and rely upon relating to the 
City's health insurance plan over the years.   
¶19 Loth, the City, the circuit court and the court of 
appeals refer to a 1973 resolution adopted by Milwaukee's common 
council, City of Milwaukee Resolution 73-216.  This resolution 
                                                 
8 City of Milwaukee Resolution 020479. 
No. 
2007AP587    
 
8 
 
was one of the City's early health insurance plans for 
management employees who retire.9  
 
¶20 The 
1973 
resolution 
provides 
for 
no-premium-cost 
insurance to City management employees who retire after January 
1, 1974, and meet three qualifications set forth in the 
resolution, namely that the employee is between the ages of 60 
and 65, has been in City service for 15 or more years, and 
retires with an unreduced retirement allowance.  
 
¶21 City of Milwaukee Resolution 73-216 states in relevant 
part as follows:  
Resolution relating to coverage for retirees with 
respect to health insurance. 
Whereas. 
The City is desirous of extending 
without cost to retirees health insurance provided by 
Blue Cross-Blue Shield and Major Medical to certain 
retirees; now, therefore, be it 
Resolved. By the Common Council of the City of 
Milwaukee that there shall be and is extended all 
present health insurance provided by Blue Cross-Blue 
Shield and Major Medical to general city employes who 
retire after January 1, 1974, and who meet all of the 
following qualifications: 
1) Are between the ages 60-65; 
                                                 
9 It does not appear that City of Milwaukee Resolution 73-
216 was in effect when the City hired Loth in 1984.  Counsel for 
the City filed with the circuit court a copy of City of 
Milwaukee Resolution 73-646, which states in relevant part that 
"Common 
Council 
Resolution 
File 
Number 
73-216 
(entitled: 
'Resolution relating to coverage for retirees with respect to 
health insurance') is hereby rescinded and repealed."  The 
City's common council passed City of Milwaukee Resolution 73-646 
late in 1973, less than one year after passing City of Milwaukee 
Resolution 73-216 and more than ten years before the City hired 
Loth.   
No. 
2007AP587    
 
9 
 
2) Who have 15 or more years of city service; and 
3) Who retire under the general city retirement 
system with an unreduced "retirement allowance;" and, 
be it 
. . . . 
Further Resolved. That all benefits for such 
coverage as provided for in this resolution shall be 
paid for by the City.10   
¶22 Two handbooks available when Loth was hired describe 
the City's health insurance plan available to retired management 
employees.  These descriptions are similar to the description of 
the City's health insurance plan in the 1973 resolution quoted 
above. 
¶23 One handbook, the City of Milwaukee Management Plan 
1983-84, describes the City's health insurance plan for retirees 
as follows: "Employees in active service who retire on normal 
pension with at least 15 years of creditable service will be 
entitled to . . . medical benefits so long as they are at least 
age 60 and less than age 65."  It further provides that 
"[g]eneral City retirees 60-65 with at least 15 years' service 
are entitled to City paid health insurance which includes their 
                                                 
10 When this resolution was adopted the City offered only 
one health insurance plan and a retiree had broad discretion to 
choose any health care provider.  Some years later the City 
began offering HMO plans in addition to the basic plan.   
When Loth was hired, the City extended no health insurance 
benefits to retirees under the age of 60. By 2002, the City 
provided that a retired management employee aged 55-65 with 30 
years of service could participate at no cost in any one of the 
multiple health insurance plans offered.   
No. 
2007AP587    
 
10 
 
eligible dependents."  Again the language refers to a management 
employee who retires and has attained the age of 60.  
¶24 A second handbook, entitled "Policies and Procedures 
for Health and Dental Plans,"11 similarly states that "[c]urrent 
City rules provide for City-paid (free) health coverage for 
general City retirees with a normal service retirement, age 60 
to 65, provided they have at least 15 years of City service."  
Again the language refers to a retiree who has attained the age 
of 60, not to an active employee.  
¶25 The 1973 Resolution and the two handbooks state that 
to be eligible for no-premium-cost health insurance, the 
management employee has to satisfy three qualifications: be at 
least 60 years old, have at least 15 years of service with the 
City, and retire.   
¶26 The final relevant document is the City's amendment to 
its health insurance plan for management employees in July 2002 
providing that the "rate structure for health insurance for all 
Management Employees who retire on or after January 1, 2004, 
[is] the same as it is for active Management Employees."  After 
January 1, 2004, active management employees had to pay premiums 
for certain health insurance plans.  Thus under the terms of the 
2002 
Resolution, 
City 
of 
Milwaukee 
Resolution 
020479, 
a 
management employee who retires on or after January 1, 2004, 
would not be entitled to participate in all health insurance 
                                                 
11 The date of publication for the Handbook does not appear 
in the circuit court record.   
No. 
2007AP587    
 
11 
 
plans at no cost, even though he had been in the service of the 
City for 15 years in 1999.  
¶27 Loth interprets the City's offer of free health 
insurance benefits as follows:  He contends that he was not 
required to work until he reached age 60 and was not required to 
retire in order to earn the health insurance benefit offered by 
the City.  He asserts that "attaining the retirement age of 60 
and retiring were merely conditions precedent to receipt of the 
deferred health insurance benefit" that Loth earned by his 15 
years of service.12  In essence, Loth argues that although he had 
to wait until reaching age 60 and retiring to get the health 
insurance benefits, the 15 years of service to the City in 
November 1999 earned him the right in 1999 to no-premium-cost 
health insurance benefits when he retired in 2005 at age 60.  
¶28 We disagree with Loth's interpretation of the City's 
unilateral offer of health insurance benefits.  The documents 
demonstrate that the City's no-premium-cost health insurance 
plan for retirees came into effect only when a management 
employee like Loth retired after attaining the age of 60 and 
having been in City service for at least 15 years.  The 1973 
resolution explicitly applies to a management employee who 
                                                 
12 Brief and Supplemental Appendix of Respondent Albert Loth 
at 19.  
See also Brief and Supplemental Appendix of Respondent 
Albert Loth at 21 ("[T]he provision for retirement at the age of 
60 establishes when the manager first becomes eligible to 
receive the benefit (i.e., retirement between the ages of 60 and 
65), not what he has to do to earn it.") (emphasis in original).   
No. 
2007AP587    
 
12 
 
retires 
after 
January 
1, 
1974 
and 
meets 
all 
three 
qualifications, that is, age, length of service, and retirement, 
to qualify for retiree health insurance.  The 1973 resolution 
offered retiree health insurance benefits only to those who 
"retire[d] under the general city retirement system with an 
unreduced 'retirement allowance[.]'"  The other pre-2004 City 
health insurance plans similarly state in one way or another 
that retiree health insurance benefits are available only to 
"General City Management employees who select retirement." 
¶29 Loth urges that in any event, "the undisputed evidence 
unequivocally reflects that the City fully understood——and 
repeatedly represented to employees and prospective employees——
that any managerial employee who provided 15 years of service 
earned the premium-paid retiree health insurance benefit," 
regardless of the employee's age or retirement status.13  Even 
viewed in the light most favorable to Loth, the record does not 
support Loth's position.  The affidavits state that the City 
sought to hire and retain employees by emphasizing the City's 
employee benefit package, but nothing in the affidavits or 
record supports Loth's contention that the City represented that 
an employee was entitled to a retiree health insurance benefit 
when he was in service for 15 years even if he was not 60 years 
of age and he did not retire.   
                                                 
13 Brief and Supplemental Appendix of Respondent Albert Loth 
at 23 (emphasis in original). 
No. 
2007AP587    
 
13 
 
¶30 Loth also relies on a line of cases going back to 1912 
to support his interpretation of the City's unilateral offer of 
health insurance benefits.  These cases hold that an employer's 
promise of deferred benefits gives rise to a binding contract 
between the employer and its employee when the employee 
completes the service required to receive the benefits.  In 
Zwolanek v. Baker Manufacturing Co., 150 Wis. 517, 521-23, 137 
N.W. 769 (1912), the court concluded that a corporate by-law 
setting forth the terms of a profit-sharing plan constituted 
"the offer of a reward to employees for constant and continuous 
service" which an employee could accept "by a performance of the 
services requested in the offer . . . ."  After the employee's 
performance, the offer cannot be revoked, "so as to deprive a 
person who has acted on the faith thereof of compensation."14   
¶31 These cases teach that the terms of an employer's 
unilateral offer are important in determining how an employee 
                                                 
14 See 
also 
Rosploch 
v. 
Alumatic 
Corp. 
of 
Am., 
77 
Wis. 2d 76, 83, 251 N.W.2d 838 (1977) (stating that Alumatic's 
profit-sharing plan "constituted an offer of deferred additional 
compensation, to be paid according to its terms, which Rosploch 
accepted by continuing to work for Alumatic."); Voigt v. S. Side 
Laundry 
& 
Dry 
Cleaners, 
Inc., 
24 
Wis. 2d 114, 
116, 
128 
N.W.2d 411 (1964) ("Non-contributory pension plans are held to 
give rise to a contractual obligation by the employer to pay 
pension benefits to the employees entitled thereto under the 
plan 
communicated 
to 
the 
employees 
where 
the 
employees 
thereafter remain in the employer's employment and render 
service for the requisite period. The same principle is 
applicable to profit sharing plans.") (citations omitted).  
No. 
2007AP587    
 
14 
 
may accept the offer and give rise to a binding contract.15  In 
the instant case, the City offered free health insurance when a 
management employee retires having attained the age of 60 and 
having been in City service for at least 15 years.   
¶32 Loth also relies on three more recent cases in support 
of his position that a contract was formed when he completed his 
15th year of City service and that the City is obligated to 
furnish health insurance benefits to him according to the plan 
in effect in 1999 when he completed his 15th year of service to 
the City: Schlosser v. Allis-Chalmers Corp., 86 Wis. 2d 226, 271 
N.W.2d 879 (1978); Roth v. City of Glendale, 2000 WI 100, 237 
Wis. 2d 173, 614 N.W.2d 467; and Champine v. Milwaukee County, 
2005 WI App 75, 280 Wis. 2d 603, 696 N.W.2d 245.  Each case, 
however, is distinguishable from the case at hand.  
¶33 In Schlosser, the plaintiff employees had worked for 
Allis-Chalmers and then had retired.  At the time of each 
employee's retirement, Allis-Chalmers had a policy to provide 
free life insurance to retired employees over the age of 65.  
Some of the employees apparently had retired before turning 65.16  
All of the employees, however, had retired pursuant to company 
rules while the free life insurance policy was still in effect.   
                                                 
15 See Schlosser v. Allis-Chalmers Corp., 86 Wis. 2d 226, 
237, 271 N.W.2d 879 (1978) ("According to basic principles of 
contract law, creation of a binding unilateral contract requires 
that the offeree perform the requested act . . . ."). 
16 See Schlosser, 86 Wis. 2d at 238 (acknowledging that some 
of the retired employees "may have retired before reaching age 
sixty-five").  
No. 
2007AP587    
 
15 
 
¶34 Allis-Chalmers argued it could unilaterally amend its 
contract to provide free life insurance to its retired employees 
pursuant to a reserved right (stated in various certificates and 
booklets that Allis-Chalmers issued to its employees) to modify 
the terms of its group life insurance plan.    
¶35 The Schlosser court stated that the employer could not 
change a life insurance benefit after an employee had retired 
and had "complied with all the conditions entitling him to 
retirement rights thereunder."17   
¶36 But the Schlosser court also stated that under the 
terms of Allis-Chalmers' policy, the employees earned the 
insurance benefit by providing the services required by Allis-
Chalmers and that "attaining age sixty-five was simply a 
condition precedent under the terms of the contract" to actual 
receipt of the earned benefit.18  In other words, as the court 
interpreted the Allis-Chalmers plan, even those employees who 
retired before reaching the age of 65 had earned the benefit of 
receiving free life insurance upon turning 65.  As the court 
interpreted the plan, the employees earned the benefit by 
working for Allis-Chalmers until retirement; the employees did 
                                                 
17 Schlosser, 86 Wis. 2d at 247 (quoting Cantor v. Berkshire 
Life Ins. Co., 171 N.E.2d 518 (Ohio 1960)). 
18 Schlosser, 86 Wis. 2d at 238. 
No. 
2007AP587    
 
16 
 
not need to put their retirement off until age 65 in order to 
receive the benefit.19   
¶37 The City's offer of health insurance benefits in the 
present case is different from Allis-Chalmers' offer of life 
insurance benefits in the Schlosser case.  Although the 
employees in Schlosser did not need to work until age 65 to earn 
the life insurance benefits offered by Allis-Chalmers, Loth and 
other management employees with 15 years of service were, under 
the City's plan, required to work until age 60 to earn the 
health insurance benefits offered by the City.20  
¶38 Furthermore, even if the City's offer did not differ 
from Allis-Chalmers' offer with regard to the age factor, Loth 
still cannot rely on Schlosser.  In Schlosser all of the Allis-
Chalmers retired employees had completed their employment with 
Allis-Chalmers and had retired while the offer of free life 
insurance was still in effect.  Loth, in contrast, did not 
complete his employment with the City and retire while the 
City's offer of free health insurance was still in effect.   
                                                 
19 The supreme court in Schlosser apparently accepted the 
circuit court's ruling that the retired employees had "complied 
with the terms of [Allis-Chalmers'] offer by continuing to work 
through retirement" and that "[w]hen each employee completed his 
or her employment at Allis Chalmers and retired from the 
company, nothing further was required of that [employee] to 
perfect his or her right to participate in the company's free 
group life insurance program."  Appendix of Allis-Chalmers' 
brief to the supreme court at viii, xvii.   
20 A management employee with 30 years of service, however, 
could earn the benefit by working until age 55 and then 
retiring.   
No. 
2007AP587    
 
17 
 
¶39 Schlosser's analysis is inapposite in the present 
case.  The City is not attempting to modify any contractual 
obligation to Loth.  Loth did not accept the City's unilateral 
promise of no-premium-cost health insurance benefits; he had not 
fully performed the services entitling him to such benefits when 
the City amended in policy in 2002 effective in 2004.  The City 
is obligated to provide retiree health insurance benefits to 
Loth according to the terms of the 2002 Resolution, which was 
already in effect when Loth completed his employment with the 
defendant at age 60 and retired.  The City has not attempted to 
amend the terms of the 2002 Resolution with respect to Loth.        
¶40 In Roth v. City of Glendale, 2000 WI 100, 237 
Wis. 2d 173, 614 N.W.2d 467, the second case upon which Loth 
relies, the City of Glendale had contracted to provide a group 
of City employees with free health insurance upon the employees' 
retirement in a series of collective bargaining agreements, each 
of which had subsequently expired after a specified term of one 
to three years.  The issue in Roth was whether a retired 
employee's contractual right to free retiree health insurance 
benefits vested under the collective bargaining agreement upon 
the employee's retirement, so that the retiree's right to free 
health insurance survived the expiration of the collective 
No. 
2007AP587    
 
18 
 
bargaining agreement that had provided the free health insurance 
benefit.21   
¶41 In Roth (as in Schlosser and in the instant case) the 
dispute centered on the proper interpretation of the terms of 
employment.  The cause in Roth was remanded to the circuit court 
to determine whether the collective bargaining agreement vested 
health benefits for the retirees.  The Roth court recognized a 
presumption that, in the absence of contractual language or 
extrinsic evidence indicating otherwise, retiree health benefits 
provided for by a collective bargaining agreement vest at the 
time of an employee's retirement.   
¶42 The Roth court (relying on the Schlosser decision) 
recognized that equitable considerations exist when employees 
are denied retirement benefits they have relied upon during 
their service to the employer and concluded that it would defy 
these equitable considerations to allow employers to modify 
their past contractual obligations to retired employees when the 
employees were given no indication that the benefits were for a 
fixed term only.22  
¶43 Roth is not on point in the present case because the 
City is not attempting to modify any past or present contractual 
obligation to Loth.  The City and Loth never formed a contract 
                                                 
21 Roth v. City of Glendale, 2000 WI 100, ¶9, 237 
Wis. 2d 173, 
614 
N.W.2d 467 
(stating 
that 
the 
plaintiffs 
"claimed a vested right to fully-paid health insurance benefits 
pursuant to the terms of the collective bargaining agreements in 
force at the time of their respective retirements.").  
22 Roth, 237 Wis. 2d 173, ¶32. 
No. 
2007AP587    
 
19 
 
obligating the City to provide Loth with no-premium-cost 
retirement health insurance benefits before Loth retired.  The 
contract between Loth and the City thus obligates the City to 
provide retiree health insurance benefits to Loth according to 
the terms of the 2002 City Resolution.  The City does not assert 
that the contract under the 2002 resolution has expired or that 
the City is not bound by the contract's terms for any other 
reason.  Furthermore, the Roth case involved employees whose 
rights were being modified after retirement; the potential 
inequities for retired employees motivating the Roth decision 
are not present in instant case.  
¶44 Finally, in Champine v. Milwaukee County, 2005 WI App 
75, 280 Wis. 2d 603, 696 N.W.2d 245, a Milwaukee County 
ordinance in effect prior to March 15, 2002, provided that 
retiring non-union employees could receive full payout for their 
accrued sick allowance.  An amended ordinance took effect on 
March 15, 2002, providing that retiring non-union employees 
could receive only partial payout for their accrued sick 
allowance.  A class of employees who retired on or after March 
15, 2002, sought to receive full payout for the sick allowance 
they had accrued prior to the effective date of the amended 
ordinance.   
¶45 The Champine court of appeals held that when an 
employee has the right to be paid for accrued sick allowance, 
the payout benefit "represents a form of deferred compensation 
that is earned as the work is performed" and that may be altered 
No. 
2007AP587    
 
20 
 
"only as it is related to work not yet performed."23  The court 
of appeals concluded in Champine that the retired employees were 
entitled to receive full payout for the sick allowance that they 
had 
accrued 
before 
the 
amended 
ordinance 
took 
effect.24  
Furthermore, 
the 
Champine 
court 
acknowledged 
equitable 
considerations, stating that "[o]nce work is performed while a 
contract 
or 
unilateral 
promise 
is 
in 
effect, 
permitting 
retroactive revocation of that promise would be unjust and 
inequitable."25 
¶46 Champine is distinguishable from the present case.  In 
Champine the payout for accrued sick leave represents a benefit 
that is "earned as the work is performed."  An employee accrues 
sick allowance (and may earn the right to receive payout for the 
accrued sick allowance) gradually as the employee performs his 
or her work.  In contrast, the City's management employees in 
the instant case earn the right to retiree health insurance 
benefits at a single designated date.  Thus the service required 
to earn the benefits and the equitable considerations in 
Champine are not present in the instant case.  
                                                 
23 Champine v. Milwaukee County, 2005 WI App 75, ¶16, 280 
Wis. 2d 603, 696 N.W.2d 245. 
24 The court of appeals did not hold that the retired 
employees were entitled to receive full payout for any sick 
allowance that they had accrued after the amended ordinance took 
effect on March 14, 2002.  The court of appeals stated that 
"[t]he ability to obtain payout for sick allowance accrued after 
March 14, 2002, may be modified prospectively by the County."  
Champine, 280 Wis. 2d 603, ¶19. 
25 Champine, 280 Wis. 2d 603, ¶17. 
No. 
2007AP587    
 
21 
 
* * * * 
¶47 For the reasons set forth, we agree with the City and 
the circuit court: The pre-2004 City health insurance plan does 
not govern Loth's health insurance on his retirement in 2005. 
The pre-2004 City health insurance plan clearly provided health 
insurance to management employees who met three qualifications: 
The management employee had to retire; had to be between the 
ages of 60 and 65; and had to have 15 or more years of city 
service.26  Before 2004, Loth met only one of the pre-2004 
qualifications for no-premium-cost health insurance: he had 15 
years of employment with the City.  Loth had neither attained 
the age of 60 nor retired when the pre-2004 health insurance 
plan was in effect.  Thus Loth had not satisfied all three 
requirements under the pre-2004 health insurance plan before the 
health insurance plan was amended to take effect in 2004.     
¶48 Accordingly, Loth's health insurance plan is governed 
by the post-2004 City resolution, which was in effect when Loth 
became 60 years of age and retired with more than 15 years of 
service with the City.  
¶49 We therefore reverse the decision of the court of 
appeals and affirm the order and judgment of the circuit court 
granting summary judgment to the City and dismissing Loth's 
complaint.   
                                                 
26 One resolution in the circuit court record also suggests 
that employees had to retire with an unreduced "retirement 
allowance."  The parties, however, do not address the issue 
whether Loth had, or needed to have, an unreduced retirement 
allowance in order to qualify for the health insurance benefit.   
No. 
2007AP587    
 
22 
 
¶50 By the Court.—The decision of the Court of Appeals is 
reversed.   
 
No. 
2007AP587    
 
 
 
1