Title: BOARD OF TRUSTEES OF THE JUDICIAL FORM RETIREMENT SYSTEM V. ATTORNEY GENERAL OF THE COMMONWEALTH OF KENTUCKY AND BOARD OF TRUSTEES OF THE KENTUCKY RETIREMENT SYSTEM V ATTORNEY GENERAL OF THE COMMONWEALTH OF KENTUCKY
Citation: N/A
Docket Number: 2002-SC-000699-DG
State: Kentucky
Issuer: Kentucky Supreme Court
Date: May 20, 2004

There is no question that Section 39 of the Kentucky Constitution vests the General Assembly with authority to determine the rules of its own proceedings . See Philpot v . Haviland , Ky., 880 S .W .2d 550 (1994) . As noted in my dissent in Philpot v . Patton , Ky ., 837 S.W.2d 491 (1992), I firmly believe that this Court cannot tell either house of the General Assembly what system or rules it can enact . In other words, the legislature is free to enact its own legislative and procedural rules and that such action cannot be challenged because of their propriety and wisdom . However, because this is a departure from procedural practice and clearly a substantive provision of the law, the failure to comply with KRS 6.350 is fatal . It has been held, except that in legislation involving contract rights, that each legislature is entirely independent of its predecessor and is vested with complete authority to amend or repeal existing laws at its pleasure . City of Mt. Sterling v. King , 126 Ky . 526, 104 S .W . 322 (1907) . Here, the retirement plan in question is a legal contract . KRS 6 .525 relates to the governance of such plan and expressly adopts KRS 21 .480, which in pertinent part refers to the pension system as an inviolate contract in which the rights and benefits provided therein shall not be subject to reduction or impairment by alteration, amendment or repeal . The constitution of Kentucky in Section 19, protects state pensioners from the General Assembly unilaterally amending statutes that impact the pension system . The constitution provides that no law impairing the obligation of contracts shall be enacted . See also 16B . Am . Jur.2d Constitutional Law §721 (1998) . When the interpretation of a statute affects persons other than current members of the General Assembly, the question presented is of necessity a judicial one . See United States v. Smith , 286 U .S . 6, 52 S .Ct . 475, 76 L.Ed . 954 (1932) . Here, it is entirely possible that the increase in the pension benefits, although totally justified, could potentially jeopardize pension benefits for retired legislators or other state employees . Cf. Valdes v . Cory, 139 Cal .App.3d 773, 189 Cal . Rptr. 212 (Cal . Ct.App.1983), which indicates that the California legislature was not free to randomly and unilaterally act without actuarial input from the board overseeing the public retirement system . Many other state courts agree . See Dadisman v . Moore , 384 S.E.2d 816 (W .Va . 1989), citing cases . The action of the legislature here, which ignores the statute largely without debate or an informed vote by the entire General Assembly, violates many sections of the Kentucky Constitution, including Section Two, which states absolute and arbitrary power does not exist anywhere in the Republic, not even in the largest majority . See also Kentucky Constitution §§19 and 25. This Court declined to extend or apply the holding of Valdes , supra, in Jones v. Bd . of Trustees . Ky . Retirement Systems , Ky ., 910 S .W .2d 710 (1995) . However, Jones , supra, is distinguishable because here, the General Assembly chose to ignore statutes requiring the actuarial analysis before increasing benefits . In Jones , it was argued that the system had independence to set contribution rates . I doubt if anyone would seriously challenge the proposition that the General Assembly is not above the law . The law as commonly defined includes statutes as well as constitutional provisions . It is the responsibility of this Court to decide in a proper case, whether the actions of the General Assembly comply with the Constitution of Kentucky, or the laws of this Commonwealth . Certainly, there is a procedure for changing statutes and it is well known and regularly and routinely used by the General Assembly in reaching a different conclusion from the effect of a statute originally enacted . Simply stated, it is repeal by direct action of previous legislative pronouncements . Moreover, there is the opportunity to permit the people of Kentucky to amend the constitution if the General Assembly so chooses . Respectfully, I do not believe that the General Assembly can repeal an existing statute by implication . "Repeal by implication finds no favor within the courts." See Caterpillar, Inc. v . Brock , Ky ., 915 S .W.2d 751, 753 (1996) . I do concur with the view expressed by the majority that the amendment of KRS 21 .450 by Section 4 of the House Bill is unconstitutionally vague and impermissibly delegates the legislative authority to an administrative agency without sufficient guidance . See Folks v . Barren County, 313 Ky . 515, 232 S.W.2d 1010 (1950), and many other cases as cited by the majority . There is a vast difference between substantial compliance and no compliance . Here, the legislature failed to follow the clear and unambiguous language of the statute . The statute is mandatory and not directory . The legislature simply made a mistake in approaching the pressing problem of pension modification . The problem is easily corrected by an appropriate legislative enactment .