Court Opinion

ID: 6323604
Source: CourtListenerOpinion
Date Created: 2022-03-15 22:16:44.341691+00
Date Added: 2024-06-11T09:21:39.710689
License: Public Domain

Filed
                                                                                       Washington State
                                                                                       Court of Appeals
                                                                                        Division Two

                                                                                         March 15, 2022

       IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

                                          DIVISION II
    DOUGLAS MERINO and KAY MERINO,                                  No. 55353-8-II
    husband and wife,

                                 Appellants,

           v.                                                 UNPUBLISHED OPINION

    STATE OF WASHINGTON, DEPARTMENT
    OF RETIREMENT SYSTEMS,

                                 Respondents.

         WORSWICK, J. — Douglas and Kay Merino appeal the superior court’s order affirming a

Department of Retirement Systems (Department) ruling that under the Washington State Patrol

Retirement System (WSPRS), Kay1 is not entitled to a future survivor benefit. This case

presents an unusual fact pattern where Douglas, an inactive member of the Washington State

Patrol (WSP) on job-related disability status, committed a felony and was subsequently

terminated. Douglas then withdrew his funds from WSPRS. Notwithstanding this withdrawal,

the Merinos sought a declaratory order from the Department stating that Kay had a right to a

spousal survivor allowance in the event they remain married and Douglas predeceases her. The

Department answered in the negative and the Department’s presiding officer entered a

1
    We use first names to avoid confusion. No disrespect is intended.
No. 55353-8-II

declaratory order granting the Department’s motion for summary judgment and denying the

Merinos’ motion for summary judgment. The superior court affirmed.

       On appeal, the Merinos argue that under the WSPRS retirement statute, RCW 43.43.270,

Kay is entitled to survivor benefits because Douglas was a member of the WSPRS at the time of

disability. The Department argues that Douglas ceased to be a member of the WSPRS when he

withdrew his funds from the WSPRS and that Kay is therefore not entitled to survivor benefits.

The Department alternatively argues that because Douglas withdrew his funds from the WSPRS

account, he is therefore not receiving a retirement allowance, and Kay’s survivor benefit is zero

dollars under the plain language of the statute. We agree with the Department’s alternative

argument. Thus, we affirm.

                                             FACTS

                   I. DOUGLAS MERINO’S HISTORY WITH WSP AND MERINO I

       The Washington State Patrol hired Douglas in 1978. He also became a member of the

Public Employees Retirement System Plan Two (PERS 2). In 1979, Douglas became an officer

with WSP, joined WSPRS, and withdrew his PERS 2 contributions. Douglas and Kay have been

married since his time in the WSP and Kay would be his surviving spouse if she remains his

spouse and he predeceases her.

       Douglas left the WSP in 1985 and he withdrew the contributions he made into his

WSPRS account. He rejoined the WSP in 1986 and also rejoined WSPRS under “Plan One.”

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No. 55353-8-II

2 Admin. Record (AR) at 219. He served as a trooper with the WSP until 1994 when he was

placed on job-related disability. Douglas began receiving disability compensation in 1994.2

         In 2008, a jury convicted Douglas of two felony counts of theft based on his ties to an

insurance fraud scheme. State v. Merino, noted at 155 Wn. App. 1039 (2010) (unpublished)

(Merino I).3 After Douglas’s conviction, the WSP chief conducted a hearing to determine

whether Douglas had violated WSP regulations, which Douglas was required to follow while

receiving disability payments.4 Merino v. State, 179 Wn. App. 889, 893-94, 320 P.3d 153 (2014)

(Merino II). After finding that Douglas had violated WSP regulations, the chief terminated

Douglas’s WSP employment. Merino II, 179 Wn. App. at 894.

2
  Douglas received disability compensation under RCW 43.43.040, which details compensation
for WSP employees who are placed on disability status after an injury.
3
 We affirmed Douglas’s convictions on appeal. Merino I, noted at 155 Wn. App. 1039, 2010
WL 1687734, at *1.
4
    The Merino II court explained:

         On November 1, 1999, more than five years after becoming disabled, Merino
         received a certified letter that the WSP sent to all troopers on disability status at
         that time. This letter (1) confirmed that Merino was an “employee on inactive status
         due to a disability,” (2) informed him that he must continue to comply with WSP
         regulations and policies, (3) required him to sign and to return the letter, and (4)
         threatened potential loss of his disability payments if he did not do so. . . . Merino
         promptly signed and returned the letter.

179 Wn. App. at 893.

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No. 55353-8-II

                                           II. MERINO II

          In 2011, the Merinos sued the State, WSP, and the Department. Merino II, 179 Wn. App.

at 894. The superior court granted the State’s motion for summary judgment dismissal. Merino

II, 179 Wn. App. at 892. We reversed, holding that Douglas was entitled to disability benefits

because they vested when he became disabled in the line of duty.5 Merino II, 179 Wn. App. at

895, 903. We further held that Douglas was entitled to disability benefits as long as his disability

continues. Merino II, 179 Wn. App. at 903. However, we noted that the disability benefits

existed to compensate injured officers for employment-generated wages that their disabilities had

taken from them, not to compensate them for continued employment. Merino II, 179 Wn. App.

at 899.

                                     III. PROCEDURAL HISTORY

          In October 2009, shortly after his conviction, Douglas asked the Department about his

retirement options. The Department informed him that it does not determine WSP disability

benefits and that he would be eligible for a WSPRS retirement at age 60. The Department then

provided Douglas with an estimate of his potential retirement benefits.

          In November 2009, Douglas submitted a “Request for Refund of Retirement

Contributions” form to the Department. 2 AR at 201-02. On the form, Douglas elected a cash

withdrawal of the funds accumulated in his WSPRS retirement account. Above Douglas’s

5
  “We hold that under the plain language of RCW 43.43.040, the legislature does not allow WSP
to revoke vested disability benefits for injuries suffered by WSP troopers in the line of duty by
terminating WSP employment, regardless of the reason for such termination.” Merino II, 179
Wn. App. at 903.

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No. 55353-8-II

notarized signature, the Request for Refund form states, in relevant part, “I have read this

document and understand that by electing to withdraw or transfer my employee contributions

plus interest I cancel all rights to any future defined retirement benefits, including any survivor

options.” 2 AR at 202. Douglas withdrew all the contributions from his WSPRS account.

         In 2018, the Merinos contacted the Department to “seek a determination of Kay Merino’s

right to survivor benefits in the event that Douglas predeceases her.”6 2 AR at 214. The

Department responded that it had no statutory authority to grant Kay survivor benefits. The

Department explained that for Kay to be eligible for survivor benefits, Douglas would have to be

a member of WSPRS Plan One but that he ceased to be a member when he withdrew his

contributions from the WSPRS account. The Department further noted:

         [The Department] does not have knowledge if a WSPRS member is on disability
         until the member passes. WSP Human Resources notifies [the Department] of their
         passing. At that time, [the Department] will transition the account by either
         providing a survivorship benefit or paying out the contributions to beneficiary(ies),
         per RCW 43.43.270. Mr. Merino’s account at [the Department] is withdrawn with
         no contributions and/or benefit to transition.

2 AR at 194 (emphasis added).

         The Merinos petitioned the Department for review. In its petition decision, the

Department’s petition examiner ruled that because Douglas was never retired but instead was on

disability status as an inactive member of WSP, he was not eligible for a retirement benefit.

Accordingly, the petition examiner ruled that Kay was not eligible to receive a survivor’s benefit

6
    The Merinos sought declaratory relief under RCW 7.24.020.

                                                  5
No. 55353-8-II

because Douglas was not retired and ended his membership with WSPRS when he withdrew his

contributions. The petition examiner affirmed the Department’s decision.

       The Merinos then appealed this decision to the Department’s presiding officer. The

Department and the Merinos filed cross motions for summary judgment. The parties’ arguments

turned on interpretation of RCW 43.43.270, which provides, in pertinent part:

       (2) . . . If the member should die after retirement the member’s lawful spouse or
       lawful domestic partner shall be paid an allowance which shall be equal to the
       retirement allowance then payable to the member or fifty percent of the final
       average salary used in computing the member’s retirement allowance, whichever
       is less. . . .

       ....

       (5)(a) The provisions of this section shall apply to members who have been retired
       on disability as provided in RCW 43.43.040 if the officer was a member of the
       Washington state patrol retirement system at the time of such disability retirement.

       The Department argued that RCW 43.43.270 does not apply to former members who

have withdrawn their contributions, as Douglas did. The Merinos argued that Douglas was

guaranteed disability payments under 43.43.040 and Merino II, and that Kay was entitled to

survivor benefits because under RCW 43.43.270(5)(a) Douglas was a “member of the

Washington state patrol retirement system at the time of his disability retirement.” 2 AR at

220-25.

       The presiding officer issued a declaratory order on the cross motions for summary

judgment in which it granted the Department’s motion for summary judgment. The presiding

officer ruled that when WSP terminated Douglas’s position, he ceased to be a member of the

WSP but continued to be a nonactive member of the WSPRS. Thus, the presiding officer

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No. 55353-8-II

concluded that when Douglas withdrew his WSPRS contributions, he cancelled his right to any

retirement benefit, including any survivor allowance.7

         The Merinos timely petitioned for judicial review and the superior court affirmed the

presiding officer’s declaratory order. The Merinos appeal.

                                            ANALYSIS

         The Merinos argue that because Douglas’s disability benefits under RCW 43.43.040(2)

vested under Merino II, those vested benefits include the retirement survival benefits for a

spouse on the death of the disabled WSP officer under RCW 43.43.270(5). The Merinos further

argue that under 43.43.270(5)(a), Douglas was a “member of the Washington state patrol

retirement system at the time of [his] disability,” and that Kay is therefore entitled to survivor

benefits. Br. of Appellant at 7-8.

         The Department argues that even if the Merinos are entitled to survivor allowance under

RCW 43.43.270(5) and the WSPRS, the amount available to pay out to a potential survivor is

7
    The presiding officer explained:

         A survivor’s right to receive retirement a retirement allowance is derivative in
         nature; it derives or flows from the benefits to which a member is entitled. A
         survivor is not a member of the retirement system, and does not have an
         independent right to a retirement allowance. When a member of the retirement
         system withdraws their retirement contributions, they cease to be a member of the
         retirement system, and their entitlement to receive retirement benefits is
         extinguished. As a result, there are no remaining benefits for the former member’s
         survivor to receive.

1 AR at 13.

                                                  7
No. 55353-8-II

zero under RCW 43.43.270(2). We agree with the Department and do not reach the remaining

arguments.

                                      I. LEGAL PRINCIPLES

A.     Standard of Review

       The Administrative Procedures Act (APA) governs the standard of review for challenges

to an agency’s adjudicative decision. RCW 34.05.570(3). We grant relief from an agency order

in an adjudicative proceeding if we determine that the agency erroneously interpreted or applied

the law. RCW 34.05.570(3)(d). We sit in the same position as the superior court and consider

the record before the agency. Kittitas County v. Kittitas County Conservation, 176 Wn. App. 38,

47, 308 P.3d 745 (2013).

       “[W]here the original administrative decision was on summary judgment, the reviewing

court must overlay the APA standard of review with the summary judgment standard.” Verizon

Nw., Inc. v. Emp’t Sec. Dep’t, 164 Wn.2d 909, 916, 194 P.3d 255 (2008). “Summary judgment

is appropriate only where the undisputed facts entitle the moving party to judgment as a matter of

law.” Verizon, 164 Wn.2d at 916. On cross motions for summary judgment, we view the

evidence in the light most favorable to the non-moving party with respect to the particular claim.

CR 56; Anderson v. Akzo Nobel Coatings, Inc., 172 Wn.2d 593, 597, 260 P.3d 857 (2011).

       We evaluate the Department’s order under the “error of law” standard. Linville v. Dep’t

of Ret. Sys., 11 Wn. App. 2d 316, 320-21, 452 P.3d 1269 (2019), review denied, 195 Wn.2d

1013, 460 P.3d 181 (2020). We give substantial weight to an agency’s interpretation of the law

within its area of expertise. Linville, 11 Wn. App. 2d at 321.

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No. 55353-8-II

          When interpreting a statute, our “fundamental objective is to ascertain and carry out the

Legislature’s intent.” Linville, 11 Wn. App. 2d at 321 (quoting Citizens All. for Prop. Rights

Legal Fund v. San Juan County, 184 Wn.2d 428, 435, 359 P.3d 753 (2015)) (internal quotation

marks omitted). Where the statute’s meaning is plain on its face, we give effect to that meaning

as an expression of legislative intent. Linville, 11 Wn. App. 2d at 321. We look to the ordinary

meaning of words, rules of grammar, and statutory context to determine what the legislature has

provided. In re Forfeiture of One 1970 Chevrolet Chevelle, 166 Wn.2d 834, 839, 215 P.3d 166

(2009). We use common sense analysis and avoids absurd results. Linnville, 11 Wn. App. 2d at

321.

B.        Relevant Statutes and Regulations

          RCW 43.43.040 provides for disability benefits for WSP officers who are injured or

incapacitated in the performance of their official duties. Under RCW 43.43.040(2)(a), officers

on disability status receive one-half their compensation during the time that their disability

continues in effect. This disability benefit vests at the time of injury. Merino II, 179 Wn. App.

at 901.

          The legislature also created the WSP retirement fund to pay “retirement allowances and

other benefits” to retired officers. RCW 43.43.130(1). Commissioned WSP officers are eligible

for the retirement plan and the fund is funded by officers’ contributions: “Any employee of the

Washington state patrol, upon date of commissioning, shall be eligible to participate in the

retirement plan and shall start contributing to the fund immediately.” RCW 43.43.130(2).

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No. 55353-8-II

       RCW 43.43.270 provides for retirement allowances and survivor benefits “[f]or members

commissioned prior to January 1, 2003.” It provides, in pertinent part:

       (1) The normal form of retirement allowance shall be an allowance which shall
       continue as long as the member lives.

       (2) . . . If the member should die after retirement the member’s lawful spouse or
       lawful domestic partner shall be paid an allowance which shall be equal to the
       retirement allowance then payable to the member or fifty percent of the final
       average salary used in computing the member’s retirement allowance, whichever
       is less. The allowance paid to the lawful spouse or lawful domestic partner shall
       continue as long as the spouse or domestic partner lives . . . . To be eligible for an
       allowance the lawful surviving spouse or lawful domestic partner of a retired
       member shall have been married to, or in a domestic partnership with, the member
       prior to the member’s retirement and continuously thereafter until the date of the
       member’s death or shall have been married to, or in a domestic partnership with,
       the retired member at least two years prior to the member’s death. . . .

       ....

       (5)(a) The provisions of this section shall apply to members who have been retired
       on disability as provided in RCW 43.43.040 if the officer was a member of the
       Washington state patrol retirement system at the time of such disability retirement.

       (b) For the purposes of this subsection, average final salary as used in subsection
       (2) of this section means:

             (i) For members commissioned prior to January 1, 2003, the average
       monthly salary received by active members of the patrol of the rank at which the
       member became disabled, during the two years prior to the death of the disabled
       member.

(Emphasis added.)

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No. 55353-8-II

                 II. SURVIVOR BENEFITS AFTER WITHDRAWAL OF CONTRIBUTIONS

A.     Merino II

       As an initial matter, the Merinos argue that our holding from Merino II, 179 Wn. App.

889, controls here and that the survivor’s retirement benefits provided for in RCW

43.43.270(5)(a) are vested under Merino II. We disagree.

       In Merino II, the question was whether disability benefits under RCW 43.43.040 vest at

the time of injury and continue after termination. 179 Wn. App. at 892. It had nothing to do

with retirement or survivor benefits and did not interpret or even cite RCW 43.43.270.

Accordingly, the Merinos’ reliance on Merino II is inapt.

B.     The Empty Fund

       The Department argues that even if the Merinos are entitled to survivor allowance under

RCW 43.43.270(5) and the WSPRS, the amount a potential survivor would be paid as calculated

under RCW 43.43.270(2) is zero. We agree.

       RCW 43.43.270(2) provides, in pertinent part:

       If the member should die after retirement the member’s lawful spouse or lawful
       domestic partner shall be paid an allowance which shall be equal to the retirement
       allowance then payable to the member or fifty percent of the final average salary
       used in computing the member’s retirement allowance, whichever is less.

       RCW 43.43.270(5)(b)(i) then expounds on this:

       For the purposes of this subsection, average final salary as used in subsection (2)
       of this section means: (i) For members commissioned prior to January 1, 2003, the
       average monthly salary received by active members of the patrol of the rank at
       which the member became disabled, during the two years prior to the death of the
       disabled member.

(Emphasis added.)

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No. 55353-8-II

       By its plain language, subsection (2) provides that survivor benefits are equal to fifty

percent of final average salary or the retirement allowance payable to the member at the time of

the member’s death, whichever is less. Subsection (5) provides that the final average salary for

survivors of those retired on disability is the equivalent to what the officer’s salary would have

been had they retired at the rank they had achieved at the time of the officer’s disability.

       The Department argues that “the retirement allowance then payable to the member” here

would be zero because Douglas withdrew his funds. Br. of Resp’t at 18. We agree. Douglas

had no retirement allowance because he withdrew his WSPRS contributions after his conviction.

Fifty percent of the final average salary will never be less than zero. Accordingly, Douglas

would not be entitled to any retirement allowance or survivor benefit.

       The Merinos appear to argue that RCW 43.43.270(5)(b)(i) itself creates a benefit because

it provides for calculating how much a survivor is entitled to independent of RCW 43.43.270(2).

But this ignores the plain language of subsection (5)(b) that explicitly refers back to subsection

(2): A survivor is entitled to “the retirement allowance then payable to the member or fifty

percent of the final average salary used in computing the member’s retirement allowance,

whichever is less.” (Emphasis added.)

       Douglas’s allowance is zero because he withdrew his contributions. Subsection (5) does

not state that a survivor is entitled to benefits only as calculated by the salary of the officer based

on rank at time of disability, but instead defines “average final salary” as used in subsection (2)

for situations where the officer has no average final salary because they have been on disability

retirement. Fifty percent of Douglas’s average final salary for purposes of RCW 43.43.270(5) is

                                                  12
No. 55353-8-II

still greater than zero. Thus, his survivor would not be entitled to any funds because his

retirement allowance is zero.

       The Merinos also argue that the survivor disability benefits are paid from another source

than WSPRS benefits. But this is beside the point. Regardless of the source of the funds, under

the plain language of RCW 43.43.270(2), the calculation for the survivor’s benefit would result

in zero dollars paid when a member has withdrawn his or her WSPRS contributions.

       To hold otherwise would allow all disabled officers to separate from the WSP, withdraw

their funds, and still be entitled to survivor’s retirement benefits—even though the funding for

those benefits had been withdrawn. This would burden officers who left their contributions in

the WSPRS fund by forcing them to pay survivor’s benefits for an officer who withdrew from

the fund. Officers who leave their funds in WSPRS would be paying for others’ double

recovery.

       This is not what the legislature intended and would result in the WSPRS fund being

drawn on twice by disabled officers and their survivors: once when they withdraw their

contributions, and a second time when the survivor receives benefits after the officer’s death.

This result is contrary to public policy because it would be tantamount to double recovery: the

officer would withdraw their contributions and the survivor would then receive a payout, too,

despite the officer having withdrawn the funds.

       We hold that when Douglas withdrew his WSPRS contributions he ceased being eligible

for a retirement allowance. In other words, when Douglas removed all his contributions from

WSPRS, he relinquished his retirement allowance, dropping it to zero. Under RCW

                                                  13
No. 55353-8-II

43.43.270(2), this amount (zero) will always be the lesser between retirement allowance and

average final salary. Accordingly, even where a survivor is entitled to disability benefits, the

survivor will not receive benefits under RCW 43.43.270 if the officer has withdrawn all

contributions from the WSPRS fund.

                                        ATTORNEY FEES

        The Merinos argue that they are entitled to attorney fees under RAP 18.1 and RCW

49.48.030. We disagree.

        RAP 49.48.030 provides:

        In any action in which any person is successful in recovering judgment for wages
        or salary owed to him or her, reasonable attorney’s fees, in an amount to be
        determined by the court, shall be assessed against said employer or former
        employer: PROVIDED, HOWEVER, That this section shall not apply if the
        amount of recovery is less than or equal to the amount admitted by the employer to
        be owing for said wages or salary.

        This argument fails for two reasons. First, the Merinos do not prevail and are therefore

not “successful.” Second, the Merinos do not show how RCW 49.48.030, a labor statute

regarding recovery of fees on recovery of wages from an employer, applies when seeking

benefits from a state agency that was not Douglas’s employer. Accordingly, we do not award

fees.

                                          CONCLUSION

        We hold that the when Douglas withdrew his contributions from WSPRS he reduced his

potential retirement allowance to zero. Because this is less than fifty percent of his final average

                                                 14
No. 55353-8-II

salary, any potential survivor would not be entitled to any payment. Accordingly, we need not

reach the parties’ remaining arguments. Thus, we affirm.

          A majority of the panel having determined that this opinion will not be printed in the

Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is

so ordered.

                                                     Worswick, J.
    We concur:

    Maxa, J.

    Hull, J.P.T.

   Judge Hull is serving as a judge pro tempore of the court pursuant to RCW 2.06.150

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