BALTIMORE COUNTY BOARD OF TRUSTEES OF EMPLOYEES'RETIREMENT SYSTEM v. Comes

Horney, J.,

delivered the majority opinion of the Court. Barnes, J., dissents. Dissenting opinion at page 191, injra.

The question presented by this appeal is whether an employee of Baltimore County against whom charges for dismissal were pending was entitled to retire and receive the pension for which he could qualify by reason of age and length of service.

The General Assembly of Maryland, by Chapter 500 of the Laws of 1943, authorized the county commissioners to establish and maintain a general system of pensions and retirements for the benefit of its employees. Accordingly, an ordinance providing a general system was adopted as of January 1, 1945.¹ Prior thereto the commissioners had been authorized by the legislature to retire and pension members of the fire² and police ³ departments.

James M. Comes, a road superintendent, was continuously employed by the county from January 1, 1918 until November 2, 1965, and, upon adoption of the general system, was awarded a certificate of his services prior to January 1, 1945. A series of indictments, returned on August 29', 1962, charging the employee with the acceptance of bribes, was dismissed by the trial court on the ground that the indictee had not willingly testified before the grand jury that indicted him and this Court affirmed the orders of dismissal in State v. Comes, 237 Md. 271, 206 A. 2d 124 (1965). In the interim, the employee filed an application on June 9, 1964 with the Board of Trustees of the Employees’ Retirement System for retirement and a pension under the provisions of Title 41 (Pensions and Retirement) to begin as of July 1, 1964. Thereafter, on March 2, 1965, the employee was served with charges for his dismissal pursuant to Title 22 (Personnel Act). No action was taken on the application for retirement, and, at its meeting on March 18, 1965, the board of trustees postponed action thereon pending the outcome of the charges for dismissal. However, before the charges could be heard by the county administrative officer, the employee filed a petition on April 6, 1965 for a writ of mandamus and, in the alternative, for a declaratory judgment. Following a hearing on the petition for the writ, the lower court (Men-chine, J.) ordered that the disciplinary action against the employee be dismissed, that the board of trustees retire the employee forthwith and that the board pay the employee such retirement benefits as he was entitled to receive under the general system.

The county retirement system is composed of three units. That for firemen, codified as § 21-12 under Title 21 (1965 Supp.), provides retirement for permanent members of the fire bureau who “perform faithful service for the bureau for a period of not less than twenty years.” Similarly, that for policemen, codified as § 21-17, provides retirement for permanent members of the police bureau who have “become permanently disabled while in the active performance of duty or [have] performed faithful service in the department for a period of not less than twenty years.” And as to service retirement benefits generally it is stated, in § 41-13 of Title 41 (1965 Supp.), that the “normal service retirement age shall be the age of sixty” and that a member “may retire before attaining the normal service retirement age provided he has completed thirty or more years of creditable service.” The term “creditable service” is defined in § 41-1 as “prior service plus membership service, for which credit is allowable.” There is, however, no specific reference in Title 41 with regard to the faithful or honorable performance of the duties which ordinarily are expected of all employees.

Judge Menchine, relying on Daigle v. McLaughlin, 193 F. Supp. 902 (D. C. 1961)⁴ and Spencer v. Bullock, 216 F. 2d 54 (D. C. Cir. 1954),⁵ as authority for the proposition that it is for the legislature, not the judiciary, to decide whether retirement benefits should be restricted to those rendering “honorable” service, declared that the employee was entitled as a matter of law to the retirement benefits for which he had applied. While we agree that it is the function of the county council, not the court, to enact and amend the laws governing the payment of benefits to such employees as have been credited with the number of years of service that makes them eligible for retirement, we think the lower court not only misinterpreted the effect of the earlier legislation (concerning the payment of pensions to firemen and policemen) on the later enactment (concerning the payment of pensions to employees generally), but did not heed the generally accepted rule to the effect that the right of a municipal employee to a pension, irrespective of age and length of service, is subject to the implied condition of employment that his duties will be faithfully performed. Aside from this, it is difficult for us to believe that the county commissioners or county council ever intended to create an inconsistent condition whereunder firemen and policemen would be required to perform the duties expected of them faithfully as a prerequisite to receiving retirement benefits whereas other county employees, regardless of their conduct, behavior and trustworthiness, would be permitted to receive retirement benefits whenever by reason of age or length of service they became entitled thereto.

In considering the county pension laws as a whole, we think it is clear that all employees, besides having completed the services for which credit was allowable, must also have complied with the obligation to perform them faithfully in order to qualify as a recipient of retirement benefits. Our interpretation of the meaning and effect of the statutes is based on the fact that the county has three separate pension systems; the fact that the affairs of the three units are administered as one system by a single board of trustees designated as the “Employees’ Retirement System”; the fact that there is nothing to indicate that the county commissioners, in adopting a general pension system for employees other than firemen and policemen, intended to exonerate the other employees from the behavioral standards that the members of the two other systems were expected to observe; the fact that there is no indication that the council, in embodying the term “creditable service” in the first paragraph of § 41-13, intended that its inclusion therein necessarily precluded the imposition of a faithful service requirement; and the fact that there is nothing to indicate that the county council, in so amending § 41-3 (by adding subsection d) as to permit presently employed firemen and policemen and to require future firemen and policemen to become members of the general retirement system, intended to create a condition whereunder it could be construed that some firemen and policemen were, and other firemen and policemen were not, subject to the additional requirement as to the faithful performance of their duties. And the cases in this and other states support the interpretation.

Except for the two cases — Daigle v. McLaughlin and Spencer v. Bullock, both supra — relied on by the lower court and the case of State ex rel. Kirby v. Board of Fire Commissioners of Hartford, 29 A. 2d 452 (Conn. 1942)⁶ which besides being in the minority, are distinguishable on the facts, we have found no cases that, one way or another, do not require the faithful and honorable performance of duties in addition to the length of service and age requirements.

The cases in this state, though not directly in point, recognize the principle that employees who are dismissed or discharged for criminal activities or malfeasance are not entitled to a pension. In Bucher v. Ober, 204 Md. 568, 105 A. 2d 480 (1954), it was held that the concealment by a police officer of his criminal actions until after his retirement did not preclude the reopening of the retirement proceedings and the revocation of his retirement and pension. In Kone v. Baltimore County, 231 Md. 466, 190 A. 2d 800 (1963), it was held that the dismissal of a police officer for not having met the test of faithful service and the consequent denial of a pension was neither arbitrary nor unreasonable. Other cases, which, by analogy, are to the same effect in that they hold that an agent or employee who willfully breaches a duty owed by him to his employer forfeits his right to a bonus or other unaccrued compensation include Adams Express Co. v. Trego, 35 Md. 47 (1872); Schneider v. Hagerstown Brewing Co., 136 Md. 151, 110 Atl. 218 (1920) ; Johnson & Higgins v. Simpson, 163 Md. 574, 163 Atl. 832 (1933) and Maryland Credit Einance Corp. v. Hagerty, 216 Md. 83, 139 A. 2d 230 (1958).

The vast majority of cases in other states, both as to the sui generis character of civil pensions and as to the implication that civil services are to be faithfully performed, are directly in point. In Ballurio v. Castellini, 102 A. 2d 662 (N. J. Super. 1954), where the words “served honorably” did not appear in the pension statute with which the court was immediately concerned, the court, after considering the fact that of the sixty pension acts which made up Title 43 of the Revised Statutes only nine spoke of “honorable service” or used equivalent words while fifty-one contained no such reference, stated that one class could not be distinguished from another on any rational basis and that it found no pattern from which a deduction might be made that the legislature had deliberately manifested its intention to require honorable service in some employments and not in others, went on to say (at p. 666) —

“Consideration of all these acts in the light of the sui generis character of a public pension inevitably leads to the conviction that ‘honorable’ service is implicit in every such enactment. A pension is a bounty springing from the appreciation and graciousness of the sovereign; it is an inducement to conscientious, efficient and honorable service. And its utility would be destroyed if a person who is properly subject to discharge because of guilt of a crime involving moral turpitude can be said to have an indefeasible claim to a pension simply because he has served the required length of time and reached the necessary age and happens to win a headlong race to file his application for retirement before the public authorities can try him on the charges pending against him arising from such crime.”

and then concluded that a ruling on whether the employee was entitled to a pension should be deferred until the pending criminal charges against him had been disposed of. The same court, in Fromm v. Board of Directors of Police and Firemen’s Retirement System, 195 A. 2d 33 (N. J. Super. 1963), after observing that the failure of a statute to make honorable service a condition precedent to the grant of a pension did not eliminate the honorable service requirement, said (at p. 34) that “one of the fundamental purposes of the pensioning of civil servants is to secure good behavior and the maintenance of reasonable standards of discipline during service.”

In MacIntyre v. Retirement Board of San Francisco, 109 P. 2d 962 (Cal. App. 1941), where several policemen brought suit to secure pension benefits under a statute that did not specifically require “honorable” service after they had been charged (either before or after retirement) with conduct unbecoming an officer and found guilty, the court, in denying pension rights, said (at pp. 963 and 964) :

“It is assumed that upon acceptance of a position as officer or employee of a government agency, an appointee will perform his duties conscientiously and faithfully. In some instances an oath is required. When it is not required, efficiency and fidelity in the performance of duty are nevertheless paramount considerations. It is never contemplated that an officer or employee guilty of conduct warranting dismissal should continue in office or be permitted to receive other emoluments offered as an inducement to honesty and efficiency. The right to a pension is not indefeasible, and an employee, though otherwise entitled thereto, may not be guilty of misconduct in his position and maintain his rights notwithstanding such dereliction of duty.”

“Without regard to the time of the vesting of pension rights, it is an implied condition of employment, and hence a condition of such vesting that the duties of the employee shall have been faithfully performed; it is immaterial whether the proper authorities discover the misconduct and file charges before or after the application for a pension so long as the charges are filed before an order is made by the retirement board.”

In People ex rel Hardy v. Greene, 84 N. Y. S. 673 (App. Div. 1903), where a policeman had been suspended on charges of misconduct several days before applying for retirement and the statute was silent as to continuous good behavior, it was said (at p. 674) :

“The provision in the statute * * * is, like all pension provisions, designed to encourage long and faithful service * * *. While there is no provision in the statute to the effect that the applicant for retirement must be in good standing at the time, it must be assumed, from the very nature and purpose of a pension, that no successful application could be made by one who was under suspension pending the trial of charges relating to his official conduct. The pension roll is a roll of honor — a reward of merit, not a refuge from disgrace; and it would be an absurd construction of the language creating it to hold that the intention of the Legislature was to give a life annuity to persons who, on their merits, as distinguished from mere time of service, might be dismissed from the force for behavior.”

To the same effect see Van Coppenolle v. City of Detroit, 21 N. W. 2d 903 (Mich. 1946), where it was held that it is an implied condition of employment, and hence a condition of the vesting of pension rights, that the duties of a municipal employee shall have been faithfully performed. Also see 3 Antieu, Municipal Corporation Law, § 22.15.

Although not directly in point, there is another line of cases, which, while recognizing the implied requirement of faithful service, have held that employees were not entitled to a pension because, having been found guilty of malfeasance or improper conduct and suspended, they had, because they were no longer employees, no standing to seek retirement and a pension. See, for example, Ewing v. Dupee, 104 So. 2d 672 (Fla.App. 1958); Skaggs v. City of Los Angeles, 268 P. 2d 1086 (Cal.App. 1954); Grant v. City of Topeka, 121 P. 2d 224 (Kan. 1942); Kennedy v. City of Holyoke, 44 N.E.2d 786 (Mass. 1942) ; State ex rel. Weber v. Board of Trustees of Policemen’s Pension Fund, 101 N. W. 373 (Wis. 1904).

We hold that the right to a pension under Title 41 of the County Code is subject to an implied condition that the duties of the employee shall be faithfully performed. Accordingly, the order of the lower court will be reversed and the case remanded to abide the result of the hearing by the county administrative officer as to whether the pending charges against the employee are true or false. And since one is not res judicata of the other, we add that the dismissal of the criminal proceedings against the employee would not preclude a finding in the administrative proceeding that the employee had done those things with which he was charged in the indictment. See 2 Freeman, Judgments, §§ 653-656. Cf. Rouse v. State, 202 Md. 481, 489, 97 A. 2d 285 (1953), cert. den. 346 U. S. 865 (1953).

Order reversed and case remanded for such further proceedings as are required as the result of the hearing by the county adiwinistrative officer; the costs on crfpeal to be paid by the appellee.

1 . See County Code (1958), Title 41, § 41-1 through § 41-58, and the amendments thereto, as to general employees.

2 . As to firemen, see Chapter 163 of the Laws of 1920, as reenacted and amended from time to time, now codified as Title 21, § 21-12.

3 . As to policemen, see Chapter 164 of the Laws of 1920, as amended from time to time, now codified as Title 23, § 21-17.

4 . In Daigle v. McLaughlin, the holding was to the effect that Congress instead of making the pension roll a “roll of honor” enacted the pension system as a means of attracting qualified men to the police and fire services.

5 . In Spencer v. Bullock, the holding was to the effect that since the applicant for a pension was qualified as to age and length of service and the statute imposed no other qualifications, he could not be deprived of a pension by the making of charges on which he was dismissed after he had elected to retire.

6 . All of these cases, unlike the instant case, concerned single (not a series of) statutes, in which only age and length of service were required; but the decision in the Kirby case seems to have been based on the deletion by the legislature of a former “meritorious” service requirement.