Title: Mowry v. State ex rel. Wyoming Retirement Bd.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Mowry v. State ex rel. Wyoming Retirement Bd.1993 WY 162866 P.2d 729Case Number: 93-99Decided: 12/23/1993Supreme Court of Wyoming
Billie 
L. MOWRY,

 Appellant 
(Plaintiff/Petitioner),

v.

STATE 
of Wyoming, ex rel., WYOMING RETIREMENT BOARD, 

Appellee 
(Defendant/Respondent).

 

Mitchell 
E. Osborn of Grant & Osborn, Cheyenne, for 
appellant.

Joseph 
B. Meyer, Atty. Gen., Peter J. Mulvaney, Deputy Atty. Gen., and Mary B. Guthrie, 
Sr. Asst. Atty. Gen., for appellee. 

Before 
MACY, C.J., and THOMAS, CARDINE, GOLDEN and TAYLOR, 
JJ.

CARDINE, 
Justice.

[¶1]      Appellant, Billie 
L. Mowry (Mowry), a retired school district superintendent, seeks judicial 
review of appellee Wyoming Retirement Board's (board) decision which held that 
severance pay received by Mowry in 1989 would not be included in calculating his 
retirement benefits.

[¶2]      We affirm the 
decision of the board.

[¶3]      Mowry phrases the 
issue as:

Is 
"severance pay," received pursuant to a valid employment contract, "cash 
remuneration" and, therefore, "salary" as defined under Wyoming Statute § 
9-3-402(a)(xvi)?

The 
board phrases the issue differently:

Whether 
the Wyoming Retirement Board's decision to not include severance pay as salary 
in calculating the Appellant's retirement benefits was arbitrary, capricious or 
an abuse of discretion or otherwise not in accordance with 
law.

FACTS

[¶4]      In 1979, Mowry 
was hired by Lincoln County School District No. One as the superintendent of 
schools. From 1981 through 1987, Mowry and the school board made a series of 
two-year employment contracts. The two-year contract signed in 1987 was due to 
expire in 1989; however, in June of 1988, Mowry and the school board negotiated 
a new one-year contract which included a provision stating that if his contract 
was not renewed the following year, then the district would pay "in addition to 
the salary provided for in this contract, severance compensation of an amount 
equal to one-third of the contract amount."

[¶5]      Mowry's contract 
was not renewed for 1989-90, and he was paid his regular monthly salary and the 
severance pay in one check each month over the last six months of employment 
with Lincoln County School District No. One. During these last six months of 
employment, the school district contributed, on behalf of Mowry, to the 
retirement system based on the total amount Mowry received, including the 
severance pay.

[¶6]      From 1989 until 
his retirement in June of 1992, Mowry was the high school principal in Burns, 
Wyoming. In 1992, Mowry inquired with the retirement system about retirement 
benefits available if he retired. On April 27, 1992, a benefit specialist at the 
retirement system forwarded Mowry a letter describing his estimated monthly 
retirement benefits, which were calculated based on the inclusion of his 1989 
severance pay. Mowry retired in June of 1992. On July 16, 1992, Mowry received a 
second estimate letter from the retirement system, which excluded the 1989 
severance pay from its calculations and reduced his estimated monthly benefits 
by approximately $300.00 per month. When the benefits were first calculated in 
April, the benefit specialist had not realized that Mowry's 1989 salary checks 
included severance pay.

[¶7]      Mowry challenged 
the retirement system's reduction in his estimated benefits before a hearing 
officer, asserting that his severance pay should have been included in the 
benefits calculation. The hearing officer ruled in favor of the retirement 
system staff, concluding that Mowry's 1989 severance pay was not salary and thus 
should not be included in the benefits calculation. The board adopted the 
hearing officer's decision. Mowry sought judicial review of the board's decision 
in district court, which then certified the matter to this 
court.

DISCUSSION

[¶8]      The issue 
presented to this court concerns statutory construction and thus is purely a 
question of law. Parker Land & Cattle Co. v. Wyoming Game & Fish Comm'n, 
845 P.2d 1040, 1042 (Wyo. 1993). We review legal conclusions of an 
administrative agency to determine whether those conclusions are in accordance 
with law. Amax Coal Co. v. Wyoming State Bd. of Equalization, 819 P.2d 825, 829 
(Wyo. 1991).

[¶9]      Our method for 
determining the meaning of statutes is firmly established. See Parker Land & 
Cattle Co., 845 P.2d  at 1042-45. We may resort to certain rules of construction 
to ascertain legislative intent but only after we have determined that the 
statute is ambiguous. Id., at 1043. One of those rules of statutory construction 
requires us to give deference to the construction given a statute by the 
administrative agency charged with administering the ambiguous statute. Id., at 
1045. In other words, we will affirm that agency's construction unless we find 
it to be clearly erroneous. Id.

[¶10]   The formula for calculating Mowry's 
retirement benefits is described in W.S. 9-3-418(a) (1991), which 
provides:

     The retirement 
allowance for a member who first becomes covered under this article after June 
30, 1981 is equal to two percent (2%) of the average salary for the highest 
three (3) continuous years of covered service multiplied by the years of covered 
service. [emphasis added]

1989 
was one of the years first used to calculate Mowry's "average salary." That year 
included the severance payments of 1989 as part of Mowry's 1989 salary. Mowry 
asserts that the April estimate, which included the severance payments, was 
correct as a matter of law because the plain and ordinary meaning of "salary" 
includes severance payments. The board argues that severance payments are not 
"salary." The term salary is defined in W.S. 9-3-402(a)(xvi) (1991), which 
provides:

"Salary" 
means the cash remuneration paid * * * in any calendar year to an employee * 
* *.

[¶11]   "Words used within statutes are to 
be given their plain and ordinary meaning." Vandehei Developers v. Public Serv. 
Com'n, 790 P.2d 1282, 1285 (Wyo. 1990). Mowry argues that the plain and ordinary 
meaning of remuneration is "any kind of payment" received, while the board 
asserts that remuneration means only those payments made in return for services 
performed.

[¶12]   Black's Law Dictionary defines 
remuneration as "[r]eward; recompense; salary; compensation." Black's Law 
Dictionary at 1165 (5th ed. 1979). Each of the terms used to define 
"remuneration" are also defined in Black's as referring to payments made in 
exchange for something equivalent, such as services rendered. Id., at 1188, 
1144, 1200, 256. Websters' Third New International Dictionary (1966) defines 
"remunerate" as: "1: to pay an equivalent for (as a service, loss or expense) 2: 
to pay an equivalent to (a person) for service, loss or expense," and defines 
"remuneration" as "remunerating." Thus, the plain and ordinary meaning of 
remuneration clearly contemplates payments made in return for something 
equivalent.

[¶13]   Severance pay is "[p]ayment by an 
employer to employee beyond his wages on termination of his employment." 
Black's, at 1232. "The historical meaning of severance pay - or `dismissal 
compensation' to use the older parlance - is payment `made by an employer to an 
employee for permanently terminating the employment relationship primarily for 
reasons beyond the control of the employee.'" Howard A. Specter and Matthew W. 
Finkin, 1 Individual Employment Law and Litigation § 5.26 at 327 (1989). These 
definitions suggest that "severance pay" is primarily gratuitous and, although 
it may be intended to partially alleviate the loss of employment, it is not an 
attempt to equally compensate the employee for services rendered, losses 
suffered, or expenses incurred.

[¶14]   Based on the plain and ordinary 
meanings of "severance pay" and "remuneration," Mowry's 1989 severance pay is 
not "remuneration" and, therefore, not "salary" and should not be included when 
calculating his retirement benefits under W.S. 9-3-418.

DISPOSITION

[¶15]   The board's decision to exclude 
Mowry's 1989 severance payment when it calculated Mowry's retirement benefits is 
affirmed because severance payments are not "salary" as defined in the Wyoming 
Retirement Act.