Respondent appeals by leave granted the circuit court’s order reversing its denial of petitioner’s application for nonduty disability retirement benefits
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under MCL 38.24. Respondent had denied the application for benefits on the basis of amended statutory-language requiring the filing of an application within one year of termination from state employment, which requirement the petitioner had not satisfied. The circuit court, however, found that the amendment was prospective only and not applicable to petitioner. We conclude that the amendment of MCL 38.24 in 2002, pursuant to
This Court reviews a circuit court’s ruling on an administrative appeal to determine whether the circuit court “ ‘applied the correct legal principles and whether it misapprehended or grossly misapplied the substantial evidence test to the agency’s factual findings.’ ”
Hinky Dinky Supermarket, Inc v Dep’t of Community Health,
It is important to recognize the time line of events that occurred in this action as viewed in relation to MCL 38.24 and the amendment of the statute. Petitioner, a state employee for approximately 25 years, was terminated from state employment in October 2000, after earlier going on medical leave in the fall of 1997. At the time of the termination, MCL 38.24 provided:
Subject to the provisions of sections 33 and 34, upon application of a member [of the state employee retirement system], or his department head, or the state personnel director, a member who has been a state employee at least 10 years becomes totally and permanently incapacitated for duty as the result of causes occurring not in the performance of duty to the state, may be retired by the retirement board: Provided, The medical advisor after a medical examination of such member, shall certify that such member is mentally or physically incapacitated for the further performance of duty, and such incapacity is likely to be permanent and that such member should be retired.
This language does not contain any time limits or deadlines within which a state employee or member must submit the application for benefits; petitioner was not precluded from applying for benefits more than one year after his termination. And without consideration of the amendment, petitioner’s application in August 2002 would have been deemed timely. The 2002 amendment of the statute, made effective March 27, 2002, incorporated a one-year deadline, requiring the filing of an application for benefits no later than one year from *154 the date of a member’s termination from state employment. An applicant can also seek benefits within two years from the date of termination where there exists good cause for the delay in not filing within the first year following termination. Specifically, MCL 38.24 now provides:
(1) Except as may otherwise be provided in sections 33 and 34, a member who becomes totally incapacitated for duty because of a personal injury or disease that is not the natural and proximate result of the member’s performance of duty may be retired if all of the following apply:
(a) The member, the member’s personal representative or guardian, the member’s department head, or the state personnel director files an application on behalf of the member with the retirement board no later than 1 year after termination of the member’s state employment.
(b) A medical advisor conducts a medical examination of the member and certifies in writing that the member is mentally or physically totally incapacitated for further performance of duty, that the incapacitation is likely to be permanent, and that the member should be retired.
(c) The member has been a state employee for at least 10 years.
(2) Upon appeal to the retirement board, the retirement board, for good cause, may accept an application for a disability retirement allowance not later than 2 years after termination of the member’s state employment.
At the time the amendment of MCL 38.24 became effective, March 27, 2002, more than one year had elapsed since petitioner’s termination; therefore, even had petitioner filed an application the day the legislation became effective, he still would have failed to comply with the one-year deadline relative to applications. Compliance by petitioner with the amended statute on or after its effective date was impossible. As indicated above, petitioner actually filed an application *155 in August 2002, outside the one-year application deadline, but within the two-year alternative period, necessitating the establishment of good cause, assuming application of the amended statute.
The change from a nonexistent deadline to apply for benefits to a one-year deadline following termination is analogous to the Legislature enacting a statute of limitations where one did not previously exist with regard to a cause of action, or where one did exist but was of longer duration than the amended version. Just as failure to file an application within one year of termination now precludes a state employee from recovering benefits, the failure by a plaintiff to commence a lawsuit within the applicable limitations period also precludes recovery. Through use of this sound analogy, we find that the amendment of MCL 38.24 cannot be made retroactive. We begin with the general principles that guide the analysis in determining whether a statute or amended statute should be applied retroactively or prospectively only.
Statutes and statutory amendments are presumed to operate prospectively.
Pohutski, supra
at 698;
Selk v Detroit Plastic Products,
We agree with defendants that there is nothing in the language of the [statute] suggesting a legislative intent that this statute be applied retroactively.... Most instructive is the fact that the Legislature included no express language regarding retroactivity. See, e.g., Chesapeake & Ohio R Co v Public Service Comm,382 Mich 8 , 22-23;167 NW2d 438 (1969) (Adams, J.). We note that the Legislature has shown on several occasions that it knows how to make clear its intention that a statute apply retroactively. See, e.g., MCL 141.1157; MSA 5.3188(257) (“This act shall be applied retroactively...”); MCL 324.21301a; MSA 13A.21301a (“The changes in liability that are provided for in the amendatory act that added this subsection shall be given retroactive application”). [Parenthetical omission in original.]
The fact that a statute relates to antecedent events —here, for example, employment history — does not require a finding that the statute operates retroactively.
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In re Certified Questions (Karl v Bryant Air Conditioning Co),
A careful review of the latest version of MCL 38.24 reflects no language whatsoever, much less clear, direct, and unequivocal language, suggesting that the amended statute, including the one-year deadline provision, is to be applied retroactively to members whose state employment had been terminated before the effective date of the amended statute, let alone employees who ceased employment more than one year before the effective date. In fact, to the contrary, the express language of the amended statute suggests that it applies only to members who become incapacitated after the effective date. MCL 38.24(1) provides, in part, that “a member who becomes totally incapacitated for duty because of a personal injury or disease that is not the natural and proximate result of the member’s performance of duty may be retired....” (Emphasis added.) The statute then sets forth the one-year deadline requirement for such a member. Given the use of the language “who becomes,” which is strictly in the future tense, as opposed to or coordinated with the use of “who was,” “who is,” or “who became,” and taking into consideration the statute’s effective date of March 27, 2002, the only logical conclusion is that the Legislature specifically intended the amendment to apply only to situations in which total incapacitation based on nonduty injuries or diseases first arose on or after March 27, 2002. Only those members whose incapacitation arose after the effective date of the amendment would need to comply with the one-year deadline in order to receive benefits under a plain reading of the statute. Petitioner’s alleged incapacitation occurred before the amendment. 2
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A statute may not be applied retroactively if it abrogates or impairs vested rights, creates new obligations, or attaches new disabilities concerning transactions or considerations occurring in the past.
Doe v Dep’t of Corrections (On Remand),
There is an exception to the general rule that newly enacted statutes are presumed to apply prospectively, which exception provides that no such presumption exists where the statute is remedial or procedural in nature, as long as it does not deny vested rights.
Brooks, supra
at 493;
Aztec Air Service, Inc v Dep’t of Treasury,
In a general sense, statutes of limitations are regarded as procedural in nature.
People v Russo,
Plaintiff relies on the so-called “exception” to the general rule of prospective application providing that “statutes which operate in furtherance of a remedy or mode of procedure and which neither create new rights nor destroy, enlarge, or diminish existing rights are generally held to operate retrospectively unless a contrary legislative intent is manifested.” Plaintiff argues that the [statute] is remedial because no new cause of action is created. Instead, according to plaintiffs, the act merely supplements and furthers remedies otherwise available. However, we have rejected the notion that a statute significantly affecting a party’s substantive rights should be applied retroactively merely because it can also be characterized in a sense as “remedial.” In that regard, we agree with Chief Justice Riley’s plurality opinion in White v General Motors Corp,431 Mich 387 , 397;429 NW2d 576 (1988), that the term “remedial” in this context should only be employed to describe legislation that does not affect substantive rights. Otherwise, “[t]he mere fact that a statute is characterized as ‘remedial’... is of little value in statutory construction.” Again, the question is one of legislative intent. [Lynch, supra at 584-585 (citations omitted; omission and alteration in original).]
In the context of the “procedural” exception, statutes of limitations, while generally coined as procedural, necessarily affect substantive rights where causes of
*161
action can be lost entirely because the action is time-barred. This would explain why there exists a plethora of cases extending over 100 years of jurisprudence that provide that statutes of limitations enacted by the Legislature are to be applied prospectively absent a clear and unequivocal manifestation of a legislative preference for retroactive application.
In re DeBancourt’s Estate,
However, were we to find MCL 600.5838; MSA 27A.5838 [statute of limitations], as amended, applicable to this case, clearly plaintiffs action would be barred. In order to resolve this question, what we must determine is whether or not this particular amended provision will operate prospectively only or reach back retroactively to affect plaintiffs suit. The Michigan Supreme Court has noted in prior decisions that statutes of limitation are to be construed to operate prospectively only unless their terms clearly indicate a contrary intent.
*162 Therefore, with respect to statutes of limitations, despite the categorizing or characterization of such statutes as procedural in nature, the general remedial-procedural exception to prospective application has not been applied. 5 Because MCL 38.24, as amended, contains no clear and unequivocal manifestation suggesting that the Legislative intended retroactive application, and because, in the context of this issue, we see no meaningful difference between a standard statute of limitations and the one-year limitation period or deadline to apply for benefits, the case law cited above controls our inquiry and requires us to rule that MCL 38.24 and its one-year limitation period is to be applied prospectively only. Moreover, as discussed above, the language of the amended statute reflects an intent that it be applied prospectively only, and thus, even were we to assume that the procedural exception to prospective application encompasses statutes of limitations, the exception is inapplicable with respect to MCL 38.24 because the legislation conveys an intent directly contrary to retroactive application. 6
The principle that statutes of limitations are to be applied prospectively parallels an accompanying well-
*163
accepted principle that “[t]he pertinent statute of limitations is the one in effect when the plaintiffs cause of action arose.”
Chase v Sabin,
Outside the context of statutes of limitations, we find support for our position in
Pohutski
and
Tarnow, supra.
In
Pohutski, supra
at 678-679, our Supreme Court, overruling prior case law, held that a trespass-nuisance exception to governmental immunity does not exist in Michigan, but it limited the holding to prospective
*164
application.
Pohutski
involved a suit for damages after raw sewage from Allen Park’s sewer system backed up through floor drains and into basements as a result of heavy rains. In the context of the Court discussing whether its decision should be applied prospectively only, the Court referenced
2001 PA 222 does not contain any language indicating it is meant to apply retroactively, but provides only that it is to take immediate effect. Section 19(1) provides that a claimant is not entitled to compensation under the statute unless the claimant notifies the governmental agency of a claim of damage or physical injury, in writing, within forty-five days after the date the damage or physical injury was or should have been discovered. Only two exceptions to the forty-five-day limit are available: if the claimant notified the contacting agency during the forty-five-day period or if the failure to comply resulted from the contacting agency’s failure to comply with notice requirements. Given the absence of any language indicating retroactive effect, the forty-five-day notice limit, and the presumption that statutes operate prospectively, we conclude that2001 PA 222 does not apply retroactively.
Thus, if we applied our holding in this case retroactively, the plaintiffs in cases currently pending would not be afforded relief under [the rejected trespass-nuisance exception] or2001 PA 222 . Rather, they would become a distinct class of litigants denied relief because of an unfortunate circumstance of timing.
Accordingly, this decision will be applied [prospectively] only.... [Pohutski, supra at 698-699 (emphasis added).]
*165 It is evident that the Pohutski Court found the legislation to be prospective only on the basis of the 45-day time frame in which parties had to notify governmental agencies of a sewage disposal system event, with which parties obviously could not comply as it was too late and previously unknown, as well as on the basis of the lack of any indication by the Legislature that the legislation was to be applied retroactively. Similarly, in the case at bar, petitioner could not comply with the one-year application deadline on or after its effective date, nor could any member whose employment had terminated a year or more before MCL 38.24 became effective. And there is no indication that the Legislature intended retroactive application; rather there is language suggesting prospective application only was intended by virtue of language speaking of future incapacitation. Petitioner, and others similarly situated, should not “become a distinct class of litigants denied relief because of an unfortunate circumstance of timing.” Pohutski, supra at 699.
In Tarnow, supra at 562, the Court explained the situation confronting it:
If the 1943 amendment is applicable, since plaintiffs application for further [workers’] compensation was not filed until 17 months after the expiration of the 500-week compensable period, and the amendment precludes the allowance of compensation for more than 1 year prior to the date of filing such application, plaintiff is barred from recovery because the 1 year retroactive period began 5 months after the expiration of the compensable period.
The Court noted that the law that controlled the payment of compensation was the one in effect at the time the right to compensation sprang into existence. Id. at 563. The Supreme Court then held:
*166 The amendment here in question may not be regarded as wholly procedural in character, as defendant contends. Obviously its effect, if so applied under the facts before us in this case, would result in taking from the plaintiff a right which the statute, in force at the time of his injury, granted to him. There is nothing in the amendment in question here indicating that the legislature intended any such possible result. In other words, there is nothing to overcome the presumption that prospective operation only was intended. It seems obvious that the purpose of the amendment was to limit the amount of recovery in certain cases. Such result must follow in any instance where the statute in its present form is invoked to defeat recovery, partially or wholly, and is applicable. The amendment may not be regarded as relating merely to procedure, nor may it be classed as remedial legislation. Under the general rule followed by this Court in the cases above cited, it should not be given a retroactive effect in the instant case. {Id. at 565-566.]
Likewise, here, there should not be retroactive application because the Legislature has not indicated such an intent but an intent to the contrary, and petitioner’s substantive rights to benefits under the act were denied for failing to comply with an application deadline that was not in effect at the time of his termination or alleged incapacitation.
Our view is also supported by general principles regarding statutory retroactivity enunciated by the United States Supreme Court in Landgraf, supra. The Landgraf Court stated:
As Justice Scalia has demonstrated, the presumption against retroactive legislation is deeply rooted in our jurisprudence, and embodies a legal doctrine centuries older than our Republic. Elementary considerations of fairness dictate that individuals should have an opportunity to know what the law is and to conform their conduct accordingly; settled expectations should not be lightly disrupted. {Id. at 265.]
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Respondent’s arguments ignore these basic principles. The Supreme Court emphasized that to give legislation retroactive effect, Congress is required to so indicate in the language of the statute in a manner that is “ ‘so clear and positive as to leave no room to doubt that such was the intention of the legislature.’ ”
Id.
at 272, quoting
Chew Heong v United States,
In sum, petitioner is not barred from seeking benefits because of a failure to comply with the one-year application deadline in MCL 38.24, as amended. On the basis of legislative intent, as gleaned from a fair reading of the statute, MCL 38.24 cannot be applied retroactively. Accordingly, we affirm the circuit court’s ruling.
Affirmed.
Notes
The Legislature’s intent to apply an amended statute retroactively can be express or implied. Thompson, supra at 417.
Even if one were to reject our conclusion that the amended statute contains language suggesting that only prospective application was *158 intended, it does not defeat the overriding premise of our analysis that the Legislature did not manifest an intent that the statute apply retroactively.
Due process concerns play a role when considering whether a statute should be applied retroactively. “The Due Process Clause ... protects the interests in fair notice and repose that may be compromised by retroactive legislation; a justification sufficient to validate a statute’s prospective application under the Clause ‘may not suffice’ to warrant its retroactive application.”
Landgraf v USI Film Products,
It is not necessary for purposes of our analysis to determine whether petitioner had “vested” rights under the law. The issue whether statutory rights equate to vested rights is somewhat muddled under Michigan law. On one hand, our Supreme Court has stated that statutory rights, although valuable, do not constitute vested rights because the Legislature may take away what it has given.
Lahti v Fosterling,
In this case, plaintiffs claim a vested right in their cause of action under the PWDCRA [Persons With Disabilities Civil Rights Act, MCL 37.1101 et seq.l. A cause of action becomes a vested right when it accrues and all the facts become operative and known. Plaintiffs’ cause of action accrued and all the facts became operative and known before the effective date of1999 PA 201 . Retroactive application of the amended definition of “public service” would impair plaintiffs’ cause of action under the PWDCRA, because prisons would be excluded as places of public service prohibited from discriminating on the basis of disability.
Although here we are not speaking of a statutory cause of action, petitioner’s claim and asserted right to benefits under MCL 38.24 was based on facts already in existence prior to the amendment, i.e., he had been employed by the state for more than ten years and he allegedly was permanently mentally or physically incapacitated for reasons unrelated to employment. Of course, he had to make an application and prove his case by way of a medical certification, but this is no different than a party in a civil suit filing the complaint and proving his or her case to the trier of fact. But again, assuming that petitioner did not have a vested right to benefits, our conclusion remains unaffected on the basis of legislative intent. We note that MCL 8.4a provides that the repeal of any statute or part of a statute “shah not have the effect to release or relinquish any. .. liability incurred under such statute ..., unless the repealing act shall so expressly provide, and such statute and part thereof shall be treated as still remaining in force for the purpose of instituting. .. any proper action ... for the enforcement of such . .. liability.”
This is reflected in
Rzadkowolski v Pefley,
We reject respondent’s reliance on
Ramsey v Michigan Underground Storage Tank Financial Assurance Policy Bd,
MCL 691.1416 et seq.
“[A] requirement that Congress first make its intention clear helps ensure that Congress itself has determined that the benefits of retroactivity outweigh the potential for disruption or unfairness.” Landgraf, supra at 268. “The presumption against statutory retroactivity has consistently been explained by reference to the unfairness of imposing new burdens on persons after the fact.” Id. at 270. Respondent’s position runs directly contrary to this notion, where it places a burden on petitioner to timely file an application after the fact, in that the burden did not exist before the legislation became effective, and the effective date was more than a year after petitioner’s termination.