City of San Diego v. Haas
143 Cal. Rptr. 3d 438
Cal. Ct. App.2012Background
- This is a pension case where the City obtained summary judgment declaring that defendants are ineligible for Four Benefits (13th check, DROP, service credits, retiree health) for hires after July 1, 2005.
- The City’s negotiated MOUs and LBFO in 2005 eliminated the Four Benefits for New Employees hired on or after July 1, 2005; the Ordinance No. 0-19567 (effective Feb 16, 2007) reflected this elimination.
- SDCERS initially continued to grant the Four Benefits to Haas and Vernon notwithstanding the 2005 changes, due to paperwork not being filed to modify the benefits.
- The City amended the Municipal Code to codify the changes and asserted retroactive effect to July 1, 2005; no vote of City employees under Charter art. IX, §143.1(a) was held.
- Vernon and Haas purchased Service Credits in 2007, and SDCERS approved these purchases before the City advised otherwise; Haas later faced a reversal attempt by the City.
- The trial court granted summary judgment for the City, certified a defense class with two subclasses, and Schaefer’s appeal from class certification was affirmed along with the judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Retroactive effect of the Ordinance valid? | City intended retroactive effect to reflect pre-existing agreements | Defendants contend retroactivity violates Charter and vested rights | Retroactive ordinance valid to implement pre-existing agreements |
| Whether plaintiffs acquired vested rights to Four Benefits | New and Unrepresented Employees lacked vested rights due to 2005 MOUs | Defendants allege vesting could occur from longstanding practice | No vested rights; elimination pre-dates employment; cannot vest |
| Necessity of Charter vote under 143.1(a) | City Council actions amended SDMC to reflect agreements | A vote was required to affect retirement benefits | vote not required; they were not SDMC “members” with vested rights |
| Authority under MMBA for retroactive benefit modifications | MMBA permits retroactive implementation to give effect to MOU changes | MMBA does not independently authorize retroactive benefit changes | MMBA permits retroactive implementation to effectuate agreements |
| Defendant Schaefer’s class certification appeal | Certification appropriate given common questions | Appeal challenges adequacy and typicality | Certification affirmed; Schaefer’s challenges lack merit |
Key Cases Cited
- Grimm v. City of San Diego, 94 Cal.App.3d 33 (Cal. App. 1st Dist. 1979) (charter city power; voting requirements for retirement amendments)
- Retired Employees Assn. of Orange County v. County of Orange, 52 Cal.4th 1171 (Cal. 2011) (bonding of collective bargaining to vested benefits; enforceable MOUs)
- County of San Joaquin v. County of San Joaquin, 39 Cal.App.3d 83 (Cal. App. 3d 1974) (retroactive pay adjustments under MMBA; implementing legislation)
- Goleta Educators Assn. v. Dall’Armi, 68 Cal.App.3d 830 (Cal. App. 3d 1977) (retroactive implementation per MMBA; statutory context)
- Miller v. State of California, 18 Cal.3d 808 (Cal. 1977) (prospective rights; benefits may be changed before hiring)
- Kern v. City of Long Beach, 29 Cal.2d 848 (Cal. 1947) (no rights to benefits pre-employment; post-acceptance vesting)
- Vielehr v. State of California, 104 Cal.App.3d 392 (Cal. App. 1980) (vesting depends on legislative modification; not vested yet)
- City of El Cajon v. El Cajon Police Officers’ Assn., 49 Cal.App.4th 64 (Cal. App. 1996) (MOU interpretation; language governs)