Court Opinion

ID: 890063
Source: CourtListenerOpinion
Date Created: 2013-06-05 06:24:33.443528+00
Date Added: 2024-06-11T09:46:26.787234
License: Public Domain

September 4 2012

                                          DA 11-0725

               IN THE SUPREME COURT OF THE STATE OF MONTANA
                                          2012 MT 192

ERENE BRIESE,

              Petitioner and Appellant,

         v.

MONTANA PUBLIC EMPLOYEES’
RETIREMENT BOARD,

              Respondent and Appellee.

APPEAL FROM:          District Court of the First Judicial District,
                      In and For the County of Lewis and Clark, Cause No. CDV 10-982
                      Honorable Kathy Seeley, Presiding Judge

COUNSEL OF RECORD:

               For Appellant:

                      Kathryn S. Syth; LaRance & Syth, P.C.; Billings, Montana

                      Nathan S. Haney; Karell, Dyre, Haney, PLLP; Billings, Montana

               For Appellee:

                      Katherine E. Talley; Special Assistant Attorney General; Helena, Montana

                                                  Submitted on Briefs: May 16, 2012

                                                              Decided: September 4, 2012

Filed:

                      __________________________________________
                                        Clerk
Justice Beth Baker delivered the Opinion of the Court.

¶1    The Montana Public Employees’ Retirement Board (MPERB) denied death

benefits1 to Petitioner Erene Briese (Erene) because her deceased husband, who had

originally named her as his beneficiary under the Montana Sheriffs’ Retirement System

(SRS), had later filed a new designation, dropping her as a beneficiary, while marital

dissolution proceedings were pending.     Erene appealed to the District Court, which

affirmed the MPERB’s order. Erene now appeals the District Court’s order. We reverse.

¶2    We consider the following issues on appeal:

¶3     1. Did Erene’s application for and acceptance of benefits on behalf of the
children render her claim moot or waive her right to challenge the beneficiary
designation?

¶4    2. Does a temporary restraining order issued in a marital dissolution proceeding
under § 40-4-121(3), MCA, apply to the designation of a beneficiary under the Sheriffs’
Retirement System?

                 PROCEDURAL AND FACTUAL BACKGROUND

¶5    Erene’s late husband, David Briese (David) was a member of the SRS as a result

of his employment as a deputy sheriff for Yellowstone County. The SRS is administered

by the Montana Public Employees’ Retirement Administration (MPERA), and governed

by the MPERB. In 2001, David designated Erene as his primary beneficiary under the

SRS plan.

1
  We will use the term “death benefits” to refer to any type of payment to a designated
beneficiary upon the death of an SRS member before retirement under § 19-7-901, MCA.
                                         2
¶6     In 2004, David filed a petition for dissolution of marriage. Under § 40-4-121(3),

MCA, the dissolution court issued a standard temporary restraining order that restrained

both parties from disposing of property, except in the usual course of business or for the

necessities of life, without either the consent of the other party or an order of the court, or

from changing the beneficiaries of “insurance or other coverage . . . held for the benefit

of a party . . . .” In August 2006, while the marital dissolution proceedings were still

pending, and without consent of Erene or the court, David filed a new designation with

the SRS, dropping Erene as beneficiary and naming instead their two minor children.

David was killed in the line of duty a few months later, in November 2006. At the time

of his death, David and Erene were separated but not divorced.

¶7     Erene apparently learned of the 2006 change in beneficiary in early 2008. Counsel

for Erene sent a letter to MPERA notifying the agency that Erene considered the 2006

change of beneficiaries to be void because it was done in violation of the temporary

restraining order. MPERA wrote back, stating that it was statutorily obligated to honor

the 2006 designation of David and Erene’s children as beneficiaries, and instructing

Erene, as the surviving parent of the minor children, to choose among various options for

payment.    Erene responded by submitting the necessary forms to activate monthly

payments to Erene for the benefit of the children.

¶8     In 2009, Erene discovered that the payment of benefits to the children rather than

to her had adverse tax consequences for the family, and she sought again to have David’s

2001 beneficiary designation enforced by MPERA. MPERA issued an “administrative

                                           3
decision,” again denying Erene’s request, and informing her of her right of administrative

appeal. Erene appealed to the MPERB, which also denied her request.

¶9     In December 2009, Erene requested that the MPERB’s denial of benefits be

formally reviewed by a hearing examiner under the Montana Administrative Procedure

Act (Title 2, chapter 4, MCA). By agreement of the parties, no hearing was held. The

hearing examiner proposed, and the MPERB adopted, a final order holding that (1) Erene

waived her right to contest the validity of the 2006 beneficiary designation when she

applied for benefits on behalf of her children; (2) the issue was moot because, once

benefits were granted to her children, the parties could not be restored to their original

positions; and (3) the temporary restraining order in the dissolution proceedings was not

applicable to an SRS beneficiary designation.

¶10    Erene petitioned the First Judicial District Court for judicial review of the

MPERB’s final order. The District Court affirmed the order without addressing the

waiver or mootness arguments, finding that the temporary restraining order did not apply

to David’s designation of SRS beneficiaries.

                              STANDARD OF REVIEW

¶11    On judicial review of an agency’s decision subject to the Montana Administrative

Procedure Act, a district court reviews findings of fact for clear error and conclusions of

law for correctness. Micone v. Dept. of Pub. Health & Human Servs., 2011 MT 178,

¶ 10, 361 Mont. 258, 258 P.3d 403 (citing In re Fair Hearing of Hofer, 2005 MT 302,

¶¶ 13-14, 329 Mont. 368, 124 P.3d 1098). The same standard applies to our subsequent

                                         4
review of the district court decision. Micone, ¶ 10. A district court’s interpretation of a

statute is a conclusion of law, which we review for correctness. In re Marriage of Funk,

2012 MT 14, ¶ 6, 363 Mont. 352, 270 P.3d 39 (citing In re C.D.H., 2009 MT 8, ¶ 21, 349

Mont. 1, 201 P.3d 126).

                                     DISCUSSION

¶12 1. Did Erene’s application for and acceptance of benefits on behalf of the
children render her claim moot or waive her right to challenge the beneficiary
designation?

¶13    Before reaching the substantive issue in this appeal, we address MPERB’s claims

that the issue is moot, or that Erene waived her claim when she applied for benefits on

behalf of her minor children.

¶14    Mootness is a threshold issue which must be resolved before addressing the

underlying dispute. Med. Marijuana Growers Ass’n v. Corrigan, 2012 MT 146, ¶ 18,

___ Mont. ___, ___ P.3d ___ (citing Povsha v. City of Billings, 2007 MT 353, ¶ 19, 340

Mont. 346, 174 P.3d 515). The mootness doctrine is one of several doctrines designed to

limit the judicial power of this Court to justiciable controversies—that is, controversies

“upon which a court’s judgment will effectively operate, as distinguished from . . .

dispute[s] invoking a purely political, administrative, philosophical, or academic

conclusion.” Progressive Direct Ins. Co. v. Stuivenga, 2012 MT 75, ¶ 16, 364 Mont.

390, 276 P.3d 867. The fundamental question to be answered in any review of possible

mootness is “whether it is possible to grant some form of effective relief to the

appellant.” Stuivenga, ¶ 37.

                                         5
¶15    MPERB claims that it is impossible to grant effective relief to Erene because, once

the payments commenced, MPERB had fully discharged its obligations under the law.

MPERB cites § 19-2-803, MCA, in support of its position. That section provides, in

pertinent part:

       (1) . . . [I]f any benefit from a system is payable to a minor, the benefit
       must be paid to one of the following: (a) a surviving parent, if any

                                        .    .   .

       (3) The payment must be in full and complete discharge and acquittance of
       the board and system on account of the benefit. The person receiving
       benefit payments pursuant to this section shall account to the minor for the
       money when the minor reaches the age of majority.

We conclude that § 19-2-803, MCA, does not prevent the Court from granting relief or

render moot the issue raised on appeal. Read as a whole, it protects MPERB from a

minor’s direct claims for additional payment after proper payment already has been made

to a surviving parent or other designated recipient on behalf of the minor. The effect of

the statute is to make the person receiving the benefit accountable directly to the minor.

It does not apply to this case.

¶16    Pointing out that she did not elect a lump-sum payment, Erene claims it is possible

to grant her effective relief by ordering that all future monthly payments be made to her

in her own capacity, as well as by ordering the issuance of corrected tax forms. We agree

with Erene that it is possible to grant some form of effective relief, at least insofar as

future monthly payments are concerned. Since MPERB did not address the issuance of

                                         6
corrected tax forms in its brief on appeal, we presume this is no longer a point of

contention and do not address it further.

¶17      MPERB next argues that, even if the case is not moot, Erene has waived her

challenge by applying for and accepting benefits on behalf of the children under the 2006

beneficiary designation. Waiver is the voluntary and intentional relinquishment of a

known right, and must be manifested in some unequivocal manner. Tvedt v. Farmers Ins.

Group of Cos., 2004 MT 125, ¶ 33, 321 Mont. 263, 91 P.3d 1 (citing Idaho Asphalt

Supply v. DOT, 1999 MT 291, ¶¶ 19, 23, 297 Mont. 66, 991 P.2d 434).

¶18      When denying Erene’s initial claim for benefits in 2008, MPERA did not inform

her of her right to challenge the denial by appeal to MPERB. Under Admin. R. M.

2.43.1501(2) (2003), Erene had the right to appeal MPERA’s decision to MPERB.

MPERA, in two separate letters to Erene dated May 30, 2008, (1) stated that MPERA

was “require[d]” to honor the 2006 change of beneficiaries, and (2) informed Erene that

she “must complete, have notarized and return to this office” the claim forms for the

children before being provided with the payment options that were available. It gave no

indication that further review was available by appeal to MPERB under Admin. R. M.

2.43.1501(2) at that time. As a matter of due process, MPERA was obligated to inform

Erene of any right to appeal and the procedures for seeking such appeal. See Pickens v.

Shelton-Thompson, 2000 MT 131, ¶¶ 13, 15, 300 Mont. 16, 3 P.3d 603 (citing Mont.

Const. art. II, § 17; Dorwart v. Caraway, 1998 MT 191, ¶ 76, 290 Mont. 196, 966 P.2d

1121).

                                            7
¶19    It was not until July 2009 that MPERA informed Erene of her appeal rights, in a

letter that also stated that she had already “mooted” her argument by applying for benefits

on her children’s behalf more than a year earlier. As Erene’s counsel told the District

Court, under the circumstances, Erene had little choice but to apply for the benefits when

she did because MPERA did not give her any other options and “she had to support the

kids.” Under these circumstances, we do not agree that Erene’s application for benefits

on behalf of her children in June 2008 was a voluntary and intentional relinquishment of

a known right. We conclude that she did not waive her argument and we proceed to the

merits of her claim.

¶20 2. Does a temporary restraining order issued in a marital dissolution proceeding
under § 40-4-121(3), MCA, apply to the designation of a beneficiary under the Sheriffs’
Retirement System?

¶21    When David filed his 2006 change of beneficiaries, MPERB had no knowledge of

the dissolution proceedings and, therefore, no reason to question the new designation.

Section 19-2-801(1)-(2), MCA, allows a member to designate a beneficiary on a

membership card and, “[u]nless otherwise provided by statute,” to change that

designation by filing with the board a new membership card. Subsection (4) provides

that, in general, “the beneficiary designation on the most recent membership card filed

with the board is effective for all purposes until the member retires.”

¶22    Erene argues, however, that David’s 2006 change of designation was invalid and

void as a matter of law because it violated the temporary restraining order issued in the

marital dissolution proceeding under § 40-4-121(3), MCA. If the 2006 designation is

                                          8
invalidated, then “the most recent membership card filed with the board” is the 2001

membership card designating her as David’s beneficiary.

¶23    Section 40-4-121(3), MCA, provides, in relevant part:

       When the clerk of the district court issues a summons pursuant to this
       chapter [(Termination of Marriage, Child Custody, Support)], the clerk
       shall issue and include with the summons a temporary restraining order:

             (a) restraining both parties from transferring, encumbering,
       hypothecating, concealing, or in any way disposing of any property, real or
       personal, whether jointly or separately held, without either the consent of
       the other party or an order of the court, except in the usual course of
       business or for the necessities of life. . . .

              (b) restraining both parties from cashing, borrowing against,
       canceling, transferring, disposing of, or changing the beneficiaries of any
       insurance or other coverage, including life, health, automobile, and
       disability coverage held for the benefit of a party or a child of a party for
       whom support may be ordered. . . .

The question posed by this case is whether the restriction of a restraining order issued

under this statute on “changing the beneficiaries of any insurance or other coverage”

applies to a change of beneficiary under the SRS. We hold that it does.

¶24    Section 40-4-101, MCA, provides that Montana’s law concerning separation and

dissolution of marriage, which encompasses the statute at issue in this case,

       shall be liberally construed and applied to promote its underlying purposes,
       which are to:

              (1) strengthen and preserve the integrity of marriage and safeguard
       family relationships;

             (2) promote the amicable settlement of disputes that have arisen
       between parties to a marriage;

                                         9
             (3) mitigate the potential harm to the spouses and their children
       caused by the process of legal dissolution of marriage; [and]

              (4) make reasonable provision for spouse and minor children during
       and after litigation . . . .

(Emphases added.)

¶25    The purpose of the law requiring a temporary restraining order is clearly to

maintain the status quo with respect to all property of the parties.          The statute is

expansively worded to capture any property, real or personal, along with any inchoate

right to property as the beneficiary of “any insurance or other coverage.” This action

mitigates the potential harm to spouses and children caused by the dissolution process

itself and ensures that reasonable provision is made for the spouse and children during the

litigation. The plain language of subsection (b) is quite broad, restricting both parties

from unilaterally “changing the beneficiaries of any . . . coverage . . . held for the benefit

of a party.” Section 40-4-121(3)(b), MCA (emphasis added). On its face, therefore, the

statute appears to restrict the removal of a spouse as a beneficiary under any type of

benefit coverage, including as a beneficiary of an SRS retirement account, so long as a

dissolution action is pending.

¶26    This interpretation is buttressed by application of the doctrine of statutory

construction known as ejusdem generis. Under this doctrine, where a list of specific

things is followed by a more general word or phrase, the general word or phrase is

interpreted to include only items that are “similar in nature” to those listed. Mattson v.

Montana Power Co., 2009 MT 286, ¶ 32, 352 Mont. 212, 215 P.3d 675 (quoting Circuit

                                          10
City Stores v. Adams, 532 U.S. 105, 114-15, 121 S. Ct. 1302, 1309 (2001)). The statute

specifically mentions life insurance among the types of coverage “includ[ed]” in its

restriction. The SRS coverage given to beneficiaries of deceased members is “similar in

nature” to life insurance. See Schade v. Arizona State Retirement Sys., 510 P.2d 42, 44

(Ariz. 1973) (“The benefits provided for beneficiaries under the State Employees’

Retirement System . . . are in the nature of proceeds of an annuity or life insurance

contract.”); Rogers v. Rogers, 152 So.2d 183, 186 (Fla. 1st Dist. App. 1963) (benefits

provided for designated beneficiaries under the Florida Teachers’ Retirement System are

in the nature of the proceeds of a life insurance contract); Teachers’ Retirement Sys. v.

Vial, 304 So.2d 53, 56-57 (La. 1st Cir. App. 1974), aff’d 317 So.2d 179 (La. 1975) (death

benefit features of the Teachers’ Retirement System are indistinguishable from life

insurance); cf. Sowell v. Teachers’ Retirement Sys., 214 Mont. 200, 204-05, 693 P.2d

1222, 1224-25 (1984) (comparing precedent concerning life insurance to the designation

of a beneficiary in the Montana Teachers’ Retirement System and applying statutes to

determine beneficiary of death benefits).

¶27   Under a standard life insurance contract, payment is made upon the death of the

insured to a “beneficiary” designated by the insured. See 43 Am. Jur. 2d Insurance

§§ 533, 1668 (LEXIS current through 2011). Under the SRS plan, payment is made upon

the death of the member to a “beneficiary” designated by the member. See Admin. R. M.

2.43.1302(22) (2012) (defining a “primary beneficiary” as “a beneficiary designated to

receive payments upon the death of a member”). Like life insurance, the beneficiary

                                        11
designation is part of an agreement to pay monies on the death of the member and, like

life insurance, the payment is not realized during the member’s lifetime. The death

benefits inure to the beneficiary directly through the decedent’s designation of the

beneficiary, the primary distinction being that the designation is made under and by

virtue of specific statutory authority rather than under an insurance contract. Sections 19-

7-901, 19-7-503(2), 19-7-801(5)(b)(ii), MCA; see Vial, 304 So.2d at 56-58.                The

coverage provided to Erene by David’s designation of her as a “beneficiary” under the

SRS plan—coverage that provides protection to the beneficiary in the event of the death

of the member—is “similar in nature” to life insurance, and therefore included within the

language of § 40-4-121(3)(b), MCA, and the restraining order.

¶28    The statute, moreover, is not confined to “insurance” but also includes “any . . .

other coverage.” We construe a statute to give effect to all of its provisions. Section 1-2-

101, MCA; see also State v. Booth, 2012 MT 40, ¶ 12, 364 Mont. 190, 272 P.3d 89.

Section 40-4-121(3)(b), MCA, construed liberally and applied to promote its underlying

purposes, prohibits any changes of beneficiary under the SRS plan, if the beneficiary at

the time the restraining order is issued is a “party or a child of a party for whom support

may be ordered.”

¶29    MPERB’s reliance on cases from other jurisdictions in which specific restraining

orders were held to be too vague to apply to a change of beneficiaries for death benefits is

misplaced. As indicated above, the language of Montana’s standard restraining order

clearly enjoins any change of beneficiaries for “any . . . coverage . . . held for the benefit

                                          12
of a party.” The broad language restraining a change of beneficiaries eliminates any need

to specifically list all of the types of accounts to which it applies. The use of the term

“including life, health, automobile, and disability coverage” indicates that this listing of

types of coverage is not exclusive. (Emphasis added.) See e.g. In re Marriage of

Keepers, 213 Mont. 350, 356, 691 P.2d 810, 813 (1984); Norman J. Singer & J.D.

Shambie Singer, Sutherland on Statutes and Statutory Construction vol. 2A, § 47.23, 417

(7th ed., West 2007) (“When ‘include’ is utilized, it is generally improper to conclude

that entities not specifically enumerated are excluded.”). The restraining order in this

case applied to David’s change of SRS beneficiary.

¶30    That Montana law did not require David to designate Erene as his beneficiary in

the first place does not change the fact that he did so. Once Erene was designated as a

beneficiary, the account was held “for the benefit of” Erene as well as David, and the

restraining order applied. Nor does it matter that the change of beneficiaries did not

affect the value of David’s retirement benefits or how they ultimately may have been

distributed as part of the marital estate.     Under its plain language, the temporary

restraining order issued under § 40-4-121(3)(b), MCA, prohibited David from changing

his SRS beneficiary during the marriage dissolution proceedings.

¶31    Finally, the fact that David substituted his children, who also were protected by

the temporary restraining order, for his spouse does not change the result. Section 40-4-

121(3)(b), MCA, does not include any exceptions for changes to beneficiaries from

                                         13
spouse to protected child or vice versa. 2 A temporary restraining order issued under the

broad restriction of the statute prohibits a party’s attempt to change one of those

designated beneficiaries during the proceeding. David’s 2006 change of beneficiaries

was unlawful because it was made in violation of the restraining order and § 40-4-121(3),

MCA.

¶32    MPERB nonetheless argues that the temporary restraining order does not apply to

it because it was not a party to the dissolution action, citing §§ 40-4-121(3)(b) and 27-19-

105, MCA. The restraining order did not, by its terms, restrain MPERB from any

particular acts. Nor was MPERB a “person[] in active concert or participation with

[David]” within the meaning of § 27-19-105(4), MCA. Whether MPERB was bound by

the terms of the restraining order is not the issue here, however. Under § 19-2-801(2),

MCA, a member is not allowed to change beneficiaries in violation of a statutory

provision. David’s 2006 beneficiary designation was made in violation of a statutorily-

mandated court order that was binding on him.

¶33    Section 40-4-121(3)(b), MCA, provides protection to some individuals or entities

affected by a violation of the temporary restraining order.               That provision states:

“[N]othing in this subsection (3) adversely affects the rights, title, or interest of a

purchaser, encumbrancer, or lessee for value if the purchaser, encumbrancer, or lessee

does not have actual knowledge of the restraining order.”               As administrator of the

2
  David could have changed his SRS beneficiary with the consent of Erene or an order of the
court. Cf. § 40-4-121(3)(a), MCA (restraining both parties from disposing of any property
“without either the consent of the other party or an order of the court”). There is no indication in
the record that he had either consent or a court order.
                                             14
retirement system, MPERA is not a “purchaser, encumbrancer, or lessee for value” under

§ 40-4-121(3)(b). Furthermore, MPERA obtained actual knowledge of the restraining

order early in 2008, before any benefits were paid, when Erene’s counsel sent a letter

challenging David’s 2006 change of beneficiaries.

¶34    MPERB further contends that public policy and legislative intent do not support

application of § 40-4-121(3)(b), MCA, to beneficiary changes in the SRS plan, citing

Sowell, 214 Mont. at 207, 693 P.2d at 1226, and State ex rel. Neuhausen v. Nachtsheim,

253 Mont. 296, 301, 833 P.2d 201, 204 (1992), superseded, 1993 Mont. Laws ch. 259.

Neither of those cases applies to Erene’s case, however, as neither of them interpreted

§ 40-4-121(3)(b), MCA, or involved the effect of a temporary restraining order. Sowell

involved a claim for death benefits by a surviving spouse who had never been named as a

beneficiary, not, as in Erene’s case, a spouse who was the properly designated beneficiary

at the time a restraining order restricting changes to the beneficiary was issued.

Neuhausen did not even address a claim for death benefits by a beneficiary, but rather

involved the division of retirement benefits between a member and his ex-spouse as part

of a divorce decree.

¶35    Also inapt is MPERB’s citation to § 19-2-1004, MCA, which states, in relevant

part, that “the right of a person to any benefit or payment from a retirement system or

plan” is not subject to execution, garnishment, attachment or any other process. This

provision does not prevent MPERB or a district court from determining the rights of

various parties to the benefits of the plan in the first place, as in this case.

                                            15
¶36    The Dissent questions the administrative forum in which Erene has raised her

claim for benefits and argues that MPERB committed “no legal error,” suggesting that

Erene’s only remedy was to request relief in the dissolution proceeding or to file a

separate declaratory judgment action. We have held that “an action [for] dissolution of

marriage abates upon the death of either party prior to the entry of decree, and at that time

the trial court loses jurisdiction to determine incidental issues such as the disposition of

property rights involved in the marriage.” In re Marriage of Lawrence, 212 Mont. 327,

330-31, 687 P.2d 1026, 1028 (1984). We need not decide in this case whether a court

retains jurisdiction over the enforcement of orders entered before one of the spouses has

died. See Aither v. Estate of Aither, 913 A.2d 376, 379 (Vt. 2006) (noting split of

authority). Here, MPERB claimed the authority to determine the applicability of a

restraining order issued pursuant to § 40-4-121(3), MCA, to an SRS account, and found it

to be inapplicable as a matter of law. Erene properly pursued this request for judicial

review in order to adjudicate the validity of MPERB’s determination, and the District

Court had the authority to decide that issue.        Section 2-4-704(2)(a)(i), (iv), MCA

(authorizing reversal of an agency decision if the district court determines that the

administrative decision is “in violation of . . . statutory provisions” or “affected by other

error of law”).

¶37    Either MPERB or Erene could have resolved any uncertainties in MPERB’s legal

obligations by seeking a declaratory judgment under the provisions of Montana’s

Uniform Declaratory Judgments Act, Title 27, chapter 8, MCA. See § 27-8-102, MCA

                                         16
(stating that the purpose of the Act is “to settle and to afford relief from uncertainty and

insecurity with respect to rights, status, and other legal relations”); Sowell, 214 Mont. at

202, 693 P.2d at 1223 (action brought by a denied claimant “to declare her rights with

respect to the retirement and death benefit account of . . . deceased”). The availability of

an alternative remedy did not foreclose Erene’s right to judicial review of MPERB’s

administrative determination.

¶38    We have not had occasion to address the question whether a violation of a

temporary restraining order automatically voids the beneficiary change. In most cases,

the remedy for violation of a restraining order is a civil or criminal contempt action

against the violator.   See §§ 3-1-501(1)(e), 45-7-309(1)(c), MCA.         Such a remedy,

however, is “no remedy at all in this context; it evaporates [with the death of the

violator,] the instant it is needed.” Aither, 913 A.2d at 380.

¶39    Courts from other jurisdictions have taken various approaches toward this

problem. Many courts have held that a court may set aside an improper change of

beneficiaries and award the proceeds to the beneficiary who was protected by the

restraining order. In Webb v. Webb, 134 N.W.2d 673, 674-75 (Mich. 1965), for example,

the Michigan Supreme Court stated:

       It needs no citation that for violation of an injunction, a court, under its
       general powers, may order a return to the status quo. . . . Transfers of
       property in violation of an injunction are invalid and may be set aside . . .
       and subsequent death of the injunction violator does not prevent the court
       from exercising such power.

                                          17
(Citations omitted.) See also Northwestern Mutual Life Ins. Co. v. Hahn, 713 N.W. 2d

709, 712 (Iowa App. 2006) (“[A] court may set aside a change in beneficiary of a life

insurance policy made in violation of a temporary injunction.”); Aither, 913 A.2d at 381

(“Because husband’s change in the beneficiaries of his life insurance policy was in

violation of the family court order, wife may be entitled to a return to the status quo the

order was intended to preserve.”); Standard Ins. Co. v. Schwalbe, 755 P.2d 802, 806

(Wash. 1988) (“[W]e hold that the trial court had the power to award the insurance

proceeds to . . . the named beneficiary protected by the preliminary injunction.”).

¶40    Other courts, while holding that the violation does not serve to automatically void

the beneficiary change, generally have found that courts have the authority to grant some

form of relief through use of their powers of equity. See e.g. Valley Forge Life Ins. Co. v.

Delaney, 313 F. Supp. 2d 1305, 1307-09 (M.D. Fla. 2002) (rejecting a per se rule that

automatically voids beneficiary changes made in violation of a temporary injunction, but

acknowledging that a removed beneficiary may seek redress in a court of equity); Davis

v. Prudential Ins. Co., 331 F.2d 346, 349-51 (5th Cir. 1964) (holding that an injunction

does not void automatically a prohibited transfer, but that the surviving spouse

nevertheless was entitled to recovery under a theory of constructive fraud); American

Family Life Ins. Co. v. Noruk, 528 N.W.2d 921, 923-24 (Minn. App. 1995) (rejecting a

bright-line rule under which a change of beneficiary made in violation of a temporary

court order would be void as a matter of law, holding that “equitable principles, rather

than a per se rule, should govern”).

                                         18
¶41    At a minimum, we agree with those courts that have held that a court has equitable

power to order a return to the status quo when a party violating a temporary restraining

order has died.3 Thus, in this case, the District Court should have invalidated David’s

2006 change of beneficiaries because it was made in violation of the statutorily-mandated

restraining order, and should have determined that his 2001 designation of Erene is “the

most recent membership card filed with the board” under § 19-2-801(4)(a), MCA.

                                         CONCLUSION

¶42    The District Court’s order of October 7, 2011, is reversed. The case is remanded

for entry of judgment declaring the 2006 beneficiary designation invalid and for further

proceedings consistent with this opinion.

                                                      /S/ BETH BAKER

We concur:

/S/ MIKE McGRATH
/S/ JAMES C. NELSON
/S/ PATRICIA COTTER
/S/ MICHAEL E WHEAT
/S/ BRIAN MORRIS

3
  As the California Supreme Court has observed, “[t]he purpose of the provisions requiring the
filing of a change of beneficiary is largely to protect the retirement system against the possibility
of being called upon to pay twice.” Watenpaugh v. State Teachers’ Retirement Sys., 336 P.2d
165, 169 (Cal. 1959). Erene is not asking MPERB to pay twice, nor is she asking for a recipient
who was wrongfully paid benefits to return them. We do not, therefore, express any opinion on a
district court’s authority to make an equitable distribution in such a circumstance.
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Justice James C. Nelson, concurring.

¶43      I concur in the Court’s Opinion on the facts presented here. It is especially

troubling to me that MPERA failed to notify Erene of her right to appeal the agency’s

denial of her challenge to David’s change of beneficiary and that MPERA effectively

stampeded Erene into applying for benefits. Opinion, ¶¶ 7, 17-19. It is equally troubling

that MPERA obtained actual knowledge of the restraining order before any benefits were

paid, yet went ahead and commenced paying benefits pursuant to David’s change of

beneficiary with the knowledge that the change was being challenged. Opinion, ¶ 33.

Given the agency’s knowledge of the restraining order, of Erene’s challenge, and of the

legal questions of first impression at issue, it seems to me that MPERA, taking a

conservative approach, could have worked through the court system to reach a temporary,

and ultimately final, disposition of this matter that would have protected the interests of

both Erene and the agency. Under the circumstances described above, it is difficult not to

conclude that MPERA was the author of its own problems.

¶44      I believe the Court’s legal analysis is sound and achieves the correct result in this

case. I am somewhat reluctant, however, to extrapolate beyond that for several reasons.

First, this is a case of first impression and, as noted, the facts here militate in Erene’s

favor.    Our jurisprudence will necessarily have to develop on a case-by-case basis,

consistent with the facts and how, if at all, the Legislature addresses these sorts of

situations. Second, it is important to acknowledge that in many dissolution cases, the

public employee’s retirement benefit may be the only significant asset in the marital
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estate.     Accordingly, it is vital that this asset be properly distributed according to

whatever law applies under the circumstances. Third, this case also demonstrates the

need for the Legislature to amend the statutes in Titles 40 and 19, MCA, to deal with

situations such as that presented here and other cases where the member changes

beneficiaries in violation of a temporary restraining order. In this regard, and in fairness

to MPERA, such statutory amendments should require that where a member is involved

in a dissolution proceeding, any temporary restraining order similar to the one in this case

must be, upon issuance, contemporaneously served on the agency and provide that the

agency be allowed to intervene in the proceedings to the extent necessary to resolve any

dispute in the distribution of the member’s retirement benefits.

¶45       With those caveats and suggestions, I concur.

                                                   /S/ JAMES C. NELSON

Justice Jim Rice, dissenting.

¶46       This administrative appeal challenges MPERB’s implementation of David’s 2006

beneficiary designation and refusal to reverse that action, which Erene argues was an

“erroneous decision.” However, Erene has established no legal error on the part of

MPERB.

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¶47   MPERB properly acted pursuant to its contractual, statutory, and constitutional

obligations to honor the beneficiary request made to it by David in 2006. See § 19-2-502,

MCA; Mont. Const. art. VIII, § 15. The Court nonetheless reverses MPERB’s actions

and faults MPERB for failing to seek a declaratory judgment to resolve “any

uncertainties in [its] legal obligations.” Opinion, ¶ 37. The Court attempts, but fails to

correctly identify, any legal error committed by MPERB, and acknowledges, as it must,

that MPERB was not subject to the temporary restraining order (TRO). Clearly, there

were no uncertainties in MPERB’s obligations, but more, it was not MPERB’s duty to

resolve any uncertainties that Erene may have perceived.

¶48   As the Court notes, the TRO, by its own express terms, was directed to, and

applied to, David and Erene only (“Respondent and Petitioner are hereby restrained from

. . . .”). The TRO was not directed to any third parties, here, MPERB. This is consistent

with statute. Section 40-4-121(3), MCA, provides that a domestic TRO restrains “both

parties” from acting to transfer their assets. Likewise, § 27-19-105, MCA, governing the

scope of injunctions and restraining orders, provides that a restraining order shall “be

binding only upon the parties to the action; their officers, agents, employees, and

attorneys; and those persons in active concert or participation with them who receive

actual notice of the order by personal service or otherwise.”         (Emphasis added.)

Although MPERB had not received notice of the TRO when it acted, thus excluding it

from the TRO’s reach, that is not the important point. Critically, under the statute,

MPERB was not a “person” acting in concert or participation with David. Section 27-19-

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105, MCA. Rather, MPERB was a government agency acting pursuant to its legal

obligations and authority. While David was bound by the TRO, MPERB was not.

Rather, it was bound to follow the law governing the agency.

¶49    Fundamentally, and consistent with our statutes above cited, “[c]ourts are without

jurisdiction to enjoin administrative agencies from performing the duties delegated to

them by proper statute or authority.” 42 Am. Jur. 2d Injunctions § 156 (2010). Instead,

an injunction or restraining order “is an appropriate remedy to prevent wrongful acts by a

public official who is acting without lawful authority and beyond the scope of his or her

official power . . . .” 42 Am. Jur. 2d Injunctions § 156 (emphasis added). MPERB was

unquestionably acting within its lawful authority to meet its clear legal obligations to

David, and in so doing, was not subject to the TRO. MPERB was faced with no

“uncertainties” in its legal obligations which compelled it to seek a declaratory judgment,

as the Court declares. Opinion, ¶ 37. There being nothing legally improper about

MPERB’s actions, Erene’s administrative appeal of that action should be rejected.

¶50    The Court seeks to evade these principles by declaring whether “MPERB was

bound by the terms of the restraining order is not the issue,” Opinion, ¶ 32, but the Court

is mistaken. The premise of Erene’s challenge is that MPERB erred in failing to reverse

its actions when presented with the TRO. The TRO is the only order which MPERB is

alleged to have violated. If MPERB complied with governing law in changing the

beneficiary, and was not subject to the TRO, its decision is not subject to reversal in this

administrative proceeding.

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¶51   The Court acknowledges that the legal error here—changing beneficiaries in

violation of the TRO—was committed by David. Opinion, ¶ 34. However, realizing that

David’s error cannot serve as a basis to reverse MPERB’s actions in this administrative

appeal, the Court attempts to manufacture error on the part of MPERB. The Court

reasons that MPERB’s reversible error occurred when it found that § 40-4-121(3), MCA,

was “inapplicable as a matter of law” to an SRS account. Opinion, ¶ 36. However, even

assuming arguendo that MPERB so erred, such an error in statutory interpretation still

would not subject MPERB to the TRO, and therefore does not establish that MPERB

committed reversible error for purposes of this administrative proceeding. An error in

interpretation does not necessarily equate to an error in action, and here MPERB clearly

acted properly by complying with its governing authority. Again, the TRO was directed

to the parties, not MPERB.     MPERB was obligated to comply with its governing

authority until and unless it received a proper legal directive to do otherwise. MPERB

acknowledges it is subject to family law orders affecting retirement plans entered

pursuant to § 19-2-907, MCA, which the Legislature specifically enacted to authorize

courts to recognize and modify retirement plans within domestic proceedings, following

our decision to the contrary in Neuhausen. However, such an order was apparently never

pursued, and Erene could not turn this administrative appeal into a declaratory judgment

action to challenge the validity of David’s actions during the dissolution proceeding.

This administrative appeal could only determine whether the agency properly acted under

its governing authority, and I would conclude it clearly did so. It should not be this

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Court’s business to rectify a perceived injustice in disregard to established statutory

procedures.

¶52    If Erene believed that David’s actions had violated the TRO and had created

uncertainty, it was incumbent upon her to initiate a declaratory judgment action or seek

judicial relief from the dissolution court which had issued the TRO. While I take no

position on the merits, a claim that David had violated the TRO would arguably have

remained justiciable even after his death. While the dissolution court may well have lost

jurisdiction to distribute the marital estate, the question would be whether a death barred

the court from addressing a prior and undisclosed violation of a restraining order which

had prejudiced a party.    Such a question was arguably “one upon which a court’s

judgment will effectively operate.” Progressive Direct Ins. Co. v. Stuivenga, 2012 MT

75, ¶ 16, 364 Mont. 390, 276 P.3d 867. Assuming the court determined the TRO had

been violated, concrete relief was possible.     However, the District Court reviewing

MPERB’s actions in this administrative appeal clearly had no authority to address that

violation.

¶53    I would affirm the District Court.

                                                 /S/ JIM RICE

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