Anderson v. S.D. Retirement Sys. , 924 N.W.2d 146 ( 2019 )

#28660-a-DG
2019 S.D. 11
IN THE SUPREME COURT
OF THE
STATE OF SOUTH DAKOTA
****
DEBRA LEE ANDERSON, Petitioner and Appellant,
v.
SOUTH DAKOTA
RETIREMENT SYSTEM, Respondent and Appellee.
****
APPEAL FROM THE CIRCUIT COURT OF
THE FOURTH JUDICIAL CIRCUIT
MEADE COUNTY, SOUTH DAKOTA
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THE HONORABLE GORDON D. SWANSON
Judge
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JAMES D. LEACH
Rapid City, South Dakota Attorney for petitioner and
appellant.
ROBERT B. ANDERSON
JUSTIN L. BELL of
May, Adam, Gerdes and
Thompson, LLP
Pierre, South Dakota Attorneys for respondent and
appellee.
****
ARGUED JANUARY 8, 2019
OPINION FILED 02/20/19
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GILBERTSON, Chief Justice
[¶1.] Debra Lee Anderson and Deborah Cady were committed partners who
worked for the Rapid City Police Department (RCPD). Cady retired from the
department in May 2012. The couple married on July 19, 2015. Cady passed away
on March 10, 2017. Upon Cady’s passing, Anderson applied for survivor spouse
benefits under Cady’s retirement plan with the South Dakota Retirement System
(SDRS). The SDRS denied Anderson’s application claiming Anderson and Cady
were not married at the time of Cady’s retirement and Anderson did not meet the
definition of a “spouse” needed to qualify for survivor benefits. Anderson appealed
to the South Dakota Office of Hearing Examiners (OHE) and then to the circuit
court, which both affirmed the SDRS. Anderson now appeals the order of the circuit
court. We affirm.
Facts and Procedural History
[¶2.] The facts of this case are undisputed. Cady was employed by the
RCPD. She was enrolled in the SDRS in 1986 and continued her enrollment for 26
years until her retirement on May 1, 2012. Throughout her service, Cady advanced
from sergeant to lieutenant and finally served as one of two captains who reported
directly to the chief of police. Cady attained the highest rank of any female officer
in the history of the RCPD at the time.
[¶3.] Cady met Anderson in 1986. The two became good friends and
eventually professed their love for one another. The couple started living together
in July 1988. Anderson described their relationship as “wonderful” and considered
Cady to be her “soul mate.” Anderson stated that the couple built and shared a
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home together, made decisions together, and supported each other’s career and
personal choices. They considered themselves to be married, even though they were
not legally married at the time.
[¶4.] Anderson was also employed by the RCPD and worked as commander
of the uniform division and in supervisory roles. Two chiefs of police under whom
Cady and Anderson served stated that the couple was well known in the RCPD to
be committed partners. According to the late Craig Tieszen, RCPD Chief of Police
from 2000–2007, there were no issues within the department about accepting Cady
and Anderson’s relationship. Current Chief of Police Karl Jegeris testified that
since he began working at the RCPD in 1995, it was very clear that the two were a
committed couple and had the same relationship as anyone who was married.
Jegeris went so far as to state that “[o]ur department considers them a married
couple, period, end of story. I speak on behalf of the department.” Anderson also
agreed that she and Cady were a well-known couple for many years in the RCPD.
[¶5.] In 2004, Cady was diagnosed with breast cancer. Anderson stated that
she assisted Cady through the difficult ordeal, which included surgery,
chemotherapy, a period of remission, the return of cancer and more chemotherapy,
and the decision to end chemotherapy. Anderson stated that during this period, she
and Cady were “very devoted and very loving to each other.” On May 1, 2012, Cady
retired from the RCPD due to cancer. Cady then applied for SDRS benefits, listing
herself as single on the application.
[¶6.] Anderson testified that she and Cady had spoken about getting
married both when Massachusetts legalized same-sex marriage in 2003, and when
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Iowa legalized same-sex marriage in 2009. In 2009, Cady surprised Anderson with
matching rings. Anderson testified that the couple had “agreed that [they] would
marry. But for [them] it was going to have to be when it was either recognized by
the State of South Dakota, which is where [they] resided and worked, or by the
Federal Government, you know, as a nation as a whole.” Anderson stated that she
and Cady felt this way because they were employed in law enforcement. Anderson
noted that as police officers, she and Cady took an oath to “the U.S. Constitution,
the Constitution of the State of South Dakota, and the laws. And at that time, you
know, South Dakota wouldn’t recognize it.” In Anderson’s view, “[e]ven if [they]
went to Iowa and would have married, it still wouldn’t have been recognized in the
State of South Dakota.”
[¶7.] In 2015, the United States Supreme Court handed down its decision in
Obergefell v. Hodges, ___ U.S. ___, 135 S. Ct. 2584, 192 L. Ed. 2d 609 (2015). In
Obergefell, the Court stated:
[T]he right to marry is a fundamental right inherent in the
liberty of the person, and under the Due Process and Equal
Protection Clauses of the Fourteenth Amendment couples of the
same-sex may not be deprived of that right and that liberty.
The Court now holds that same-sex couples may exercise the
fundamental right to marry. No longer may this liberty be
denied to them.
Id. at ___, 135 S. Ct. at 2605-06. Twenty-three days after Obergefell was decided,
Anderson and Cady were married in Las Vegas, Nevada on July 19, 2015.
[¶8.] On March 10, 2017, Cady passed away after her long battle with
breast cancer. On March 20, 2017, Anderson applied for survivor benefits through
the SDRS. On April 24, 2017, the SDRS denied Anderson’s application via a letter,
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stating Anderson and Cady were not married at the time of Cady’s retirement and
Anderson did not meet the definition of a “spouse” to qualify for survivor benefits.
Anderson replied to the SDRS by letter on July 7, 2017. The reply was treated as
an appeal and a hearing was held before the OHE on October 31, 2017.
[¶9.] On December 1, 2017, the OHE issued a written decision, including
findings of fact and conclusions of law, affirming the SDRS’s decision to deny
Anderson survivor benefits. On December 4, 2017, Anderson made a motion
proposing supplemental findings of fact and conclusions of law, which the OHE
rejected. Anderson appealed the OHE’s decision to affirm the SDRS’s decision to
the circuit court. On June 14, 2018, the circuit court entered a memorandum
decision and order affirming the decision of the OHE. Anderson now appeals the
order of the circuit court. We combine and restate the issues raised as follows:
Whether the circuit court erred by denying survivor spouse benefits to Anderson.
Standard of Review
[¶10.] The central issue in this appeal is the propriety of the adjudication of
Anderson’s right to survivor benefits, which adjudication occurred through the
SDRS and the OHE, two administrative agencies. This appeal is therefore
governed by South Dakota’s Administrative Procedures Act, SDCL chapter 1-26.
SDCL 1-26-36 delineates the standard for a circuit court’s review of an
administrative agency’s decision, and “[t]he same rules apply on appeal to this
Court.” Lagler v. Menard, Inc., 2018 S.D. 53, ¶ 22, 915 N.W.2d 707, 715.
Questions of law are reviewed de novo. Dakota Trailer Mfg.,
Inc. v. United Fire & Cas. Co., 2015 S.D. 55, ¶ 11, 866 N.W.2d
545, 548. Matters of reviewable discretion are reviewed for
abuse. SDCL 1-26-36(6). The agency’s factual findings are
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reviewed under the clearly erroneous standard. SDCL 1-26-
36(5). The agency’s decision may be affirmed or remanded but
cannot be reversed or modified absent a showing of prejudice.
SDCL 1-26-36.
Id.
Analysis & Decision
[¶11.] SDCL 3-12-94 states the eligibility requirements for a surviving spouse
to receive survivor benefits from a person enrolled in the SDRS:
Upon the death of a foundation retiree or any foundation
member who has reached normal retirement age, the surviving
spouse is eligible to receive a benefit, payable in monthly
installments, equal to sixty percent of the retirement benefit
that the foundation member was receiving or was eligible to
receive at the time of death.
SDCL 3-12-47(80) defines a spouse as “a person who was married to the member at
the time of the death of the member and whose marriage was both before the
member’s retirement and more than twelve months before the death of the
member[.]”
[¶12.] The OHE and the circuit court affirmed SDRS’s rejection of Anderson’s
application for survivor benefits because: (1) Anderson and Cady were not married
at the time of Cady’s retirement; and (2) Anderson did not meet the definition of a
“spouse” under SDCL 3-12-47(80). Anderson makes two constitutional claims.
First, Anderson claims that the Supreme Court’s holding in Obergefell—that same-
sex couples can no longer be denied the right to marry—should be applied
retroactively to a time before Cady’s retirement. Second, she claims that the
retroactivity of Obergefell should be extended to same-sex couples like her and
Cady, who Anderson claims, but for South Dakota’s unconstitutional prohibition of
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same-sex marriage, would have been married prior to Cady’s retirement. Anderson
claims that accepting these arguments leads to the recognition of her marriage to
Cady before the date of their actual marriage and before the date of Cady’s
retirement, and therefore, to the recognition of Anderson as Cady’s spouse for
purposes of SDCL 3-12-47(80). Anderson argues that the circuit court erred in
rejecting these constitutional arguments and holding that she was not entitled to
survivor benefits.
[¶13.] As to the retroactivity of Obergefell, Anderson first cites Harper v.
Virginia Dep’t of Taxation, 509 U.S. 86, 97, 113 S. Ct. 2510, 2517, 125 L. Ed. 2d 74
(1993). In Harper, the Supreme Court adopted a rule of retroactivity applying to
the Court’s decision on federal laws, stating:
When this Court applies a rule of federal law to the parties
before it, that rule is the controlling interpretation of federal law
and must be given full retroactive effect in all cases still open on
direct review and as to all events, regardless of whether such
events predate or postdate our announcement of the rule. . . .
[W]e now prohibit the erection of selective temporal barriers to
the application of federal law in noncriminal cases. In both civil
and criminal cases, we can scarcely permit “the substantive law
to shift and spring” according to “the particular equities of
individual parties’ claims” of actual reliance on an old rule and
of harm from a retroactive application of the new rule.
Id. at 97, 113 S. Ct. at 2517 (citations omitted). Anderson also cites a number of
cases and secondary sources that support the retroactivity of Obergefell. See, e.g.,
Ranolls v. Dewling, 223 F. Supp. 3d 613, 622 (E.D. Tex. 2016); Steven A. Young,
Note, Retroactive Recognition of Same-Sex Marriage for the Purposes of the
Confidential Marital Communications Privilege, 58 Wm. & Mary L. Rev. 319, 336
(2016) (“Although the Court does not explicitly state that same-sex couples affected
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by pre-Obergefell law are entitled to retroactive application of post-Obergefell law, it
is the logical result of the ruling.”); Lee-ford Tritt, Moving Forward by Looking
Back: The Retroactive Application of Obergefell, 2016 Wis. L. Rev. 873, 877 (2016).
[¶14.] The parties do not seem to contest the retroactive application of
Obergefell. In its brief, the SDRS suggests that Obergefell may be retroactive.
However, the SDRS claims that the question of retroactivity is not controlling, here,
because, as both the OHE and the circuit court reasoned, the only question in this
case is whether Anderson or this Court may “create a marriage post hoc despite the
fact that Anderson and Ms. Cady never availed themselves of the marriage laws in
another state that recognized same-sex marriage.”
[¶15.] In its decision, the OHE noted that in other jurisdictions where
retroactivity has been recognized, the retroactive ruling only affects same-sex
marriages that were already solemnized in any manner or if the state recognizes
common-law marriages. See generally, Schuett v. FedEx Corp., 119 F. Supp. 3d
1155 (N.D. Cal. 2016) (solemnized marriage); Hard v. Attorney Gen., 648 Fed. Appx.
853 (11th Cir. 2016) (solemnized marriage); Dewling, 223 F. Supp. 3d 613 (common-
law marriage). The OHE reasoned that in order for Obergefell to apply
retroactively, there must have been an previously unrecognized marriage between
the couple that would have been recognized but for the law against same-sex
marriages.
[¶16.] The circuit court agreed with the reasoning of the OHE and found it
significant that Anderson and Cady chose not marry in another state prior to
Obergefell. The circuit court stated:
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Had they [married in another state], and assuming retroactive
application of [Obergefell], Anderson would presumably prevail
here. However, [Anderson and Cady] chose not to take this
course of action (for cited reasons that seem plausible and
laudable); instead waiting until an option to their liking—going
out of State to wed after the Supreme Court said home States
must recognize such a marriage—became available. Similarly,
if they had sought a marriage license in South Dakota, had it
denied based on the existing State laws, successfully challenged
that denial in the courts as the Plaintiffs in other States did,
then married in South Dakota, Anderson would be entitled to
survivor benefits. However, [Anderson and Cady] also chose not
to pursue this avenue. This Court agrees with the simple
proposition advanced by SDRS and held by the [OHE]: that even
retroactive application of Obergefell cannot create a marriage
where none was ever solemnized according to any State’s law at
the time of the measuring event (Cady’s retirement).
[¶17.] In cases cited by Anderson, those courts only applied Obergefell
retroactively to a solemnized marriage or to a common-law marriage recognized
under state law. Here, assuming without deciding that Obergefell applies
retroactively, there was no marriage, act of solemnization, or common-law marriage
to refer back to. Anderson admits that she was not married to Cady at the time
Cady retired—indeed, it is undisputed that the pair did not marry or attempt to
marry until July 19, 2015.
[¶18.] But Anderson claims that but for South Dakota’s unconstitutional
prohibition of same-sex marriage, she and Cady would have been married before the
time Cady retired. Anderson emphasizes their long-time affection and commitment
to one another and their desire to comply with South Dakota’s constitution given
their role as police officers. Anderson and Cady’s commitment to one another and
honorable intentions are not disputed by the parties. But the fact remains that
neither Anderson nor Cady made any actual attempt to marry before the date of
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Cady’s retirement. Anderson’s argument therefore, in essence, boils down to an
attempt to establish a common-law marriage between her and Cady. South Dakota,
however, does not recognize common-law marriage, requiring that a marriage “be
solemnized, authenticated, and recorded.” SDCL 25-1-29.
[¶19.] Because Anderson and Cady made no attempt to marry one other, and
because South Dakota does not recognize common-law marriage, the issue in this
case is resolved as a matter of statutory interpretation. SDCL 3-12-94 provides that
only a “spouse” is eligible to receive survivor benefits, and SDCL 3-12-47(80) defines
a spouse as “a person who was married to the member at the time of the death of the
member and whose marriage was both before the member’s retirement and more
than twelve months before the death of the member.” (Emphasis added.) Under
these statutes, Anderson cannot meet the definition of spouse, and therefore, is not
entitled to Cady’s survivor benefits under South Dakota law.
[¶20.] Anderson further argues that the denial of survivor benefits
constitutes discrimination against same-sex couples on the basis of marriage.
However, we have previously held in State Div. of Human Rights, ex rel. Ewing v.
Prudential Ins. Co. of Am., that the denial of employer administered benefits on the
basis of marital status does not constitute discrimination. 273 N.W.2d 111, 115
(S.D. 1978). In that case, Ewing, an unmarried woman with no dependents, filed a
claim with Prudential for maternity benefits in order to pay for the medical
expenses from the birth of her first child. Id. at 112. Ewing’s Prudential policy,
however, only provided maternity benefits to those who listed a spouse as a
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dependent and paid an increased premium. Id. Her claim was therefore denied.
Id.
[¶21.] Ewing filed a complaint with South Dakota’s Human Rights
Commission arguing that because “marriage is not a prerequisite for pregnancy,
[the Prudential] policy discriminate[d] against unwed mothers and married women
who for various reasons would not list their husbands as dependents and that such
denial of maternity benefits constituted sex discrimination in employment and
public accommodations.” Id. The Commission found that Ewing had been illegally
discriminated against on the basis of sex, but the circuit court reversed. Id. at 112-
13. We held that Ewing, as a single woman, was not discriminated against on the
basis of gender for being denied pregnancy benefits when she had a child. Id. at
115. This was because the only way for any single employee to obtain pregnancy
benefits was to be married, declare a spouse as a dependent, and pay an additional
premium.∗ Relying on General Electric v. Gilbert, 429 U.S. 125, 97 S. Ct. 401, 50 L.
Ed. 2d 343 (1976), we noted that “discrimination based upon sex does not result
simply because an employer’s disability benefits plan is less than all-inclusive. . . .”
Therefore, we held that the policy did not discriminate on the basis of gender but
rather differentiated on the basis of marital status. Effectively, this holding stands
for the proposition that an employer or its pension plan may limit administered
benefits on the basis of marital status.
∗ We noted “although women are the only ones physically capable of pregnancy
and childbirth, both men and women are legally capable of incurring
responsibility and liability for bills for the medical expense of maternity.”
Ewing, 273 N.W.2d at 115.
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[¶22.] The same logic applies here. SDCL 3-12-94 only allows for a state
employee’s survivor benefits to go to a surviving spouse. To be considered a
surviving spouse, Anderson would have had to be Cady’s spouse at the time of
Cady’s retirement. As stated above, she was not. This is still true despite Anderson
and Cady’s honorable views that getting married when same-sex marriage was not
recognized in South Dakota would somehow reflect poorly on themselves or the
RCPD. Anderson was denied survivor benefits because her application did not
entitle her to such benefits under South Dakota Law. There was no discrimination
on the basis of Anderson’s gender or sexual orientation.
[¶23.] For the reasons stated above, the circuit court did not err in affirming
the SDRS’s and the OHE’s decisions to deny Anderson survivor benefits.
[¶24.] JENSEN, Justice, and ELSHERE and SHELTON, Circuit Court
Judges, and SEVERSON, Retired Justice, concur.
[¶25.] ELSHERE, Circuit Court Judge, sitting for KERN, Justice,
disqualified.
[¶26.] SHELTON, Circuit Court Judge, sitting for SALTER, Justice,
disqualified.
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