Nielsen v. Retirement Board

2019 UT App 89THE UTAH COURT OF APPEALS
MARJEAN SEARCY NIELSEN AND UNIVERSITY OF UTAH,
Petitioners,
v.
RETIREMENT BOARD,
Respondent.
Opinion
No. 20180010-CA
Filed May 23, 2019
Original Proceeding in this Court
Heather S. White, Robert T. Denny, and Rachel E.
Phillips, Attorneys for Petitioner Marjean
Searcy Nielsen
Sean D. Reyes and Brent A. Burnett, Attorneys for
Petitioner University of Utah
David B. Hansen and Erin G. Christensen, Attorneys
for Respondent
JUDGE KATE APPLEBY authored this Opinion, in which
JUDGES RYAN M. HARRIS and DIANA HAGEN concurred.
APPLEBY, Judge:
¶1 Marjean Searcy Nielsen and the University of Utah
(University) seek judicial review of the Utah State Retirement
Board’s (Board) final order, arguing that the Board erred in
determining that Nielsen was not entitled to continue
participating in Utah Retirement Systems’ Public Employee
Noncontributory Retirement System (URS Plan). We conclude
the Board’s determination was based on an erroneous
interpretation and application of the law, and Nielsen has been
substantially prejudiced by its error. We therefore set aside the
Board’s order and instruct it to hold further proceedings
consistent with this opinion.
Nielsen v. Retirement Board
BACKGROUND
¶2 In 2013, Nielsen had accrued 20.65 years of service credit
in the URS Plan working with various participating employers.
That year, she began working for the University in a position
statutorily classified to participate in a non-URS retirement
system (Alternate Plan). Because she had service credit in the
URS Plan before the date of her University employment, she was
entitled to a “one-time irrevocable election to continue
participation” in the URS Plan. Utah Code Ann. § 49-13-204(2)(c)
(LexisNexis Supp. 2018).
¶3 Nielsen claims she accepted her position at the University
in part because she knew she could continue participating in
the URS Plan. Before beginning her new employment, Nielsen
claims she telephoned the Utah State Retirement Office (URS)
and asked if she needed to take any steps to maintain active
participation in the URS Plan. According to Nielsen, a
URS representative told her she was “good to go” and did
not need to take any affirmative steps. Nielsen does not
remember the name of the URS representative, and URS has no
record of any such conversation. In any event, upon
commencing her employment with the University, Nielsen did
not affirmatively choose to participate in the Alternate Plan
and—perhaps in reliance on her phone call with URS—she did
not take any steps to continue participating in the URS Plan.
Accordingly, the University enrolled her by default in the
Alternate Plan.
¶4 Nielsen participated in the Alternate Plan for about two
years, but claims not to have noticed she was not enrolled in the
URS Plan until January 2015. Because Nielsen would lose a
significant amount of retirement benefits by not participating in
the URS Plan, she and the University discussed how she might
re-enroll. An email dated January 28, 2015, from a University
staff member said, “I have told [Nielsen] that she needs to resign
from her position at the [University] then we will re-hire her in
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the same position after 32 days. At that time, she can enroll in
the [URS Plan].”
¶5 In February 2015, Nielsen resigned from her University
position. Thirty-six days later, the University rehired Nielsen to
the same position from which she resigned. When she was
rehired, Nielsen “signed an Irrevocable Retirement Plan Election
to request participation [in the URS Plan].” The University
certified to URS that, beginning the day Nielsen was rehired, she
was eligible to participate in the URS Plan. About seven months
after Nielsen was rehired, URS notified her she was not entitled
to participate in the URS Plan. It explained that, because she
made an “irrevocable election . . . to participate in [the Alternate
Plan]” in 2013, she was not eligible to participate in the URS Plan
while employed at the University.
¶6 Nielsen appealed URS’s decision to the Board’s executive
director. The executive director upheld URS’s decision,
explaining that when Nielsen “began employment with the
University of Utah, . . . [she] had a one time opportunity under
statute to elect to continue with [the URS Plan] but did not do
so.” His letter to Nielsen added, “Unfortunately, I do not have
the discretion to contradict the statute and allow you another
election to rejoin [the URS Plan].”
¶7 Nielsen filed a “Request for Board Action,” and the
University was joined as a third-party respondent. Nielsen, the
University, and URS each filed a motion for summary judgment.
Nielsen and the University argued that, under the plain
language of Utah Code section 49-13-204(2)(c), she was entitled
to continue participation in the URS Plan. Nielsen presented
evidence showing she would “lose over $550,000 in retirement
benefits if she [was] not permitted to continue with [the URS
Plan].”
¶8 After considering the undisputed evidence and the
parties’ arguments, the Board granted summary judgment in
favor of URS. The order began by noting that, under Utah Code
20180010-CA 3 2019 UT App 89Nielsen v. Retirement Board
section 49-13-204(2)(c), Nielsen “had a statutory one-time
irrevocable election to continue her participation [in the URS
Plan] when she began employment with the University in 2013.”
The Board then interpreted the statute and applied it to Nielsen’s
case. First, it noted that, “[u]nder the plain language of the
statute, the election must be made when beginning
employment.” The Board explained that “‘[i]rrevocable,’ on its
own, would necessarily require that the election be made only
once—once you’ve made it, it cannot be undone or changed.” It
then interpreted the word “one-time” to mean “there is one
limited period, once an employee begins employment, to make
the election.” Based on this statutory interpretation, the Board
concluded that, because Nielsen “failed to exercise her election
when she began employment [in 2013], and instead was enrolled
in the [Alternate Plan], she was unable to make the election at a
later date.”
¶9 Nielsen and the University seek judicial review.
ISSUE AND STANDARD OF REVIEW
¶10 The issue before this court is whether the Board erred in
determining that Nielsen was not entitled to make an election to
continue participating in the URS Plan. 1 This issue requires us to
review the Board’s interpretation and application of Utah Code
section 49-13-204(2)(c). “We review the Board’s application or
interpretation of a statute as a question of law under the
correction-of-error standard.” Whitaker v. Utah State Ret. Board,
2008 UT App 282, ¶ 10, 191 P.3d 814 (quotation simplified). We
1. Nielsen remains a member of the URS Plan with vested
benefits based on her 20.65 years of service credit. See Utah Code
Ann. § 49-13-401(1) (LexisNexis Supp. 2018). The issue is
whether she may elect to “continue” participating while
employed at the University—that is, accrue additional service
credit.
20180010-CA 4 2019 UT App 89Nielsen v. Retirement Board
will grant relief only if we determine that Nielsen has been
substantially prejudiced by the Board’s erroneous interpretation
or application of the law. See Utah Code Ann. § 63G-4-403(4)(d)
(LexisNexis 2016).
ANALYSIS
I. Statutory Interpretation
¶11 Nielsen argues that she is “entitled to continue her
participation in [the URS Plan] based on the plain language of
Utah Code section 49-13-204(2)(c).” 2 We agree.
¶12 In interpreting a statute, our “primary goal is to give
effect to the legislature’s intent in light of the purpose that the
statute was meant to achieve. The best evidence of the
legislature’s intent is the plain language of the statute itself.”
State v. Ogden, 2018 UT 8, ¶ 31, 416 P.3d 1132 (quotation
simplified). Accordingly, “under our rules of statutory
construction, we look first to the statute’s plain language to
determine its meaning.” Whitaker v. Utah State Ret. Board, 2008
UT App 282, ¶ 15, 191 P.3d 814 (quotation simplified). “If the
plain meaning of the statute can be discerned from its language,
then we need not employ any other interpretive tools.” State v.
Hunt, 2018 UT App 222, ¶ 17, 438 P.3d 1 (quotation simplified).
¶13 The statute at issue here provides, “[A] regular full-time
employee who begins employment with an institution of higher
education on or after May 11, 2010, has a one-time irrevocable
election to continue participation in [the URS Plan], if the
employee has service credit in [the URS Plan] before the date of
2. Nielsen’s arguments are consistent with the University’s
position. The University argues that the Board “erred in its
interpretation of [Utah Code section 49-13-204(2)(c)],” and
requests that we set aside “the Board’s final agency action.”
20180010-CA 5 2019 UT App 89Nielsen v. Retirement Board
employment.” Utah Code Ann. § 49-13-204(2)(c) (LexisNexis
Supp. 2018). It is undisputed that, at least at some point, Nielsen
was entitled to make a one-time irrevocable election to continue
in the URS Plan. That is, Nielsen is a regular full-time employee
at an institution of higher education who began employment
after May 11, 2010, and she had service credit in the URS Plan
before the date of her employment. It is also undisputed that
Nielsen made her first and only affirmative election to continue
participating in the URS Plan in 2015. 3
¶14 The Board concluded, however, that section
49-13-204(2)(c) required Nielsen to make her election within
some “limited period” after she first began employment at
the University in 2013. As we explain below, the Board’s
interpretation of section 49-13-204(2)(c) is contrary to the
plain meaning of the statute’s unambiguous language. Because
the statute does not limit the time frame within which
3. The Board argues that, because “Nielsen did not make the
necessary election to participate in the [URS Plan],” her default
enrollment in the Alternate Plan “had the effect of irrevocably
limiting her retirement participation to the Alternate Plan.” That
is, it asserts Nielsen’s failure to take affirmative action regarding
her participation in a particular retirement plan “result[ed] in
irrevocable application of [a] default election.” We reject this
argument because it is contrary to the statute’s plain language.
The right to an “election” includes the right to make an
affirmative choice. See Merriam-Webster’s Collegiate Dictionary
400 (9th ed. 1986) (defining “election” as “the right, power, or
privilege of making a choice”). In proceedings before the Board,
the parties stipulated that Nielsen “did not make an election to
continue her retirement participation with URS upon beginning
employment with the University in February 2013.” And we are
not convinced that a “non-election” (the default enrollment),
without some affirmative choice of the employee, can qualify as
an “election” as the term is used in Utah Code section
49-13-204(2)(c).
20180010-CA 6 2019 UT App 89Nielsen v. Retirement Board
employees must make their one-time irrevocable elections, and
because Nielsen made her first and only election in 2015, we
conclude she is entitled to continue participating in the URS
Plan.
¶15 First, the Board erred when it determined that the clause
“who begins employment . . . on or after May 11, 2010,” means
“the election must be made when beginning employment.”
(Emphasis added.) The Board now clarifies its interpretation,
arguing that “a regular full-time employee who begins
employment” means “the election is available only . . . for a short
period of time following and anchored to the hire date.”
¶16 We reject this interpretation because it is contrary to
proper grammar and usage. See State ex rel. Div. of Forestry, Fire
& State Lands v. Tooele County, 2002 UT 8, ¶ 13, 44 P.3d 680(applying “elementary rules of punctuation and grammar . . . as
an aid to ascertain the legislature’s purpose” (quotation
simplified)); see also Antonin Scalia & Bryan A. Garner, Reading
Law: The Interpretation of Legal Texts 140 (1st ed. 2012) (“Words
are to be given the meaning that proper grammar and usage
would assign them.”). In section 49-13-204(2)(c), “who begins
employment with an institution of higher education on or before
May 11, 2010,” is a relative clause that modifies the term
“regular full-time employee.” Thus, not all regular full-time
employees have the right to a one-time irrevocable election; only
such employees who begin employment on or after May 11,
2010, have that right. Contrary to the Board’s interpretation, the
clause “who begins employment . . . on or after May 11, 2010,”
does not establish a period in which the relevant employees
must make their elections.
¶17 Second, the Board erred in determining that the term
“one-time irrevocable election” means “there is one limited
period . . . to make the election.” “Absent a contrary indication,
we assume that the legislature used each term advisedly
according to its ordinary and usually accepted meaning.” Muddy
Boys, Inc. v. Department of Commerce, 2019 UT App 33, ¶ 12
20180010-CA 7 2019 UT App 89Nielsen v. Retirement Board
(quotation simplified). Because the term “one-time irrevocable
election” is not defined in the relevant statute, “we must
endeavor to determine its plain and ordinary meaning.” 4 Id.
¶ 16. In determining “the ordinary meaning of nontechnical
terms of a statute, our starting point is the dictionary. If not plain
when read in isolation, a word may become so in light of its
linguistic, structural, and statutory context.” Nichols v. Jacobsen
Constr. Co., 2016 UT 19, ¶ 17, 374 P.3d 3 (quotation simplified).
4. Many of the Board’s arguments rely on “federal law and
guidance.” That is, the Board argues that its interpretation of
Utah Code section 49-13-204(2)(c) “keeps URS and its employers
and members within the established bounds to maintain its tax
qualified status” under federal law. We acknowledge that the
Board has a duty to “ensure that the [retirement] systems, plans,
programs, and funds are administered according to law” and
“on an actuarially sound basis,” Utah Code Ann. § 49-11-
203(1)(c), (g) (LexisNexis 2015), and that the Board “may take
actions necessary to protect the tax-qualified status of the
systems, plans, and programs under its control,” id. § 49-11-
801(5). But this statutory authority does not permit the Board to
ignore a statute’s plain language. See Allred v. Utah State Ret.
Board, 914 P.2d 1172, 1175 (Utah Ct. App. 1996) (“If the Board
believes that the current language of the Act produces an
actuarially unsound retirement system, the Board should seek
relief from the Legislature through an amendment to the Act.”).
Further, the “federal law and guidance” cited by the Board does
not support the Board’s claim that the legislature used the term
“one-time irrevocable election” as “a defined term of art with
respect to retirement plan participation elections.” We tend to
agree with Nielsen that the phrase is not well-defined, and we
are not convinced that it has “a settled meaning in the law.” See
Truck Ins. Exch. v. Rutherford, 2017 UT 25, ¶ 7, 395 P.3d 143(explaining that “when a statute adopts a legal term of art with a
settled meaning in the law, we interpret the statute to embrace
the meaning of the term as it is understood in that context”
(quotation simplified)).
20180010-CA 8 2019 UT App 89Nielsen v. Retirement Board
But “unambiguous language may not be interpreted to
contradict its plain meaning.” Lorenzo v. Workforce Appeals Board,
2002 UT App 371, ¶ 11, 58 P.3d 873 (quotation simplified).
¶18 The dictionary defines “irrevocable” as “not possible to
revoke: unalterable.” Merriam-Webster’s Collegiate Dictionary
640 (9th ed. 1986). “Unalterable” means “not capable of being
altered or changed.” Id. at 1282. The word “one-time” means
“occurring only once: one shot.” Id. at 824. And “one-shot”
means “complete or effective through being done or used or
applied only once” or “not followed by something else of the
same kind.” Id.
¶19 Applying these definitions here, a one-time irrevocable
election is an election that (1) may be made only once (one-time),
and (2) may not be changed, altered, or revoked (irrevocable).
But defining an election as “one-time irrevocable” does not, by
itself, establish a restriction on when the election must be made.
The Board argues that this interpretation renders meaningless
the word “one-time.” It asserts that “[o]nce the irrevocable
election is made, there would not be another opportunity to
make it by virtue of its irrevocability because it would remain in
force, unable to be revoked or altered.” According to the Board,
because “‘one-time’ must add something to the meaning,” it
“signifies that . . . there is one limited period, once an employee
begins employment, to make the election.” We are not
convinced.
¶20 To be sure, this court seeks to interpret statutes “to give
meaning to all parts, and avoid rendering portions of the statute
superfluous.” State v. Outzen, 2017 UT 30, ¶ 9, 408 P.3d 334(quotation simplified). But adopting the Board’s interpretation
would require us to ignore the plain meaning of unambiguous
language and “effectively write into the statute words that are
not there.” Whitaker v. Utah State Ret. Board, 2008 UT App 282,
¶ 18, 191 P.3d 814; see also State v. Rincon, 2012 UT App 372, ¶ 14,
293 P.3d 1142 (“[O]ur jurisprudence prohibits us from reading
substantive terms into a statute that are not already there.”). In
20180010-CA 9 2019 UT App 89Nielsen v. Retirement Board
contrast, Nielsen argues that the term “one-time irrevocable
election” means one-time irrevocable election, no more and no
less. We see no reason to conclude that the term is intended to
mean something different. See Scott v. Scott, 2017 UT 66, ¶ 26, 423
P.3d 1275 (explaining that courts “should discern what the
legislature intended from the plain language of the text
unencumbered by notions of what we think the legislature must
have wanted the language to accomplish”).
¶21 If, as the Board argues, the legislature intended the
election to be available only “at or for a short period of time
following and anchored to the hire date,” “surely the legislature
would have said so in the text of [the statute].” Olsen v. Eagle
Mountain City, 2011 UT 10, ¶ 22, 248 P.3d 465. In fact, provisions
immediately preceding and following section 49-13-204(2)(c) set
time limitations on when other groups of employees must make
similar elections. See Utah Code Ann. §§ 49-13-204(1)(a), (5)(a)–
(b) (LexisNexis Supp. 2018). Under our rules of statutory
interpretation, we must “give effect” to the legislature’s omission
of a time limitation “by presuming [it] to be purposeful.” Marion
Energy, Inc. v. KFJ Ranch P’ship, 2011 UT 50, ¶ 14, 267 P.3d 863.
¶22 In sum, Utah Code section 49-13-204(2)(c) provides
Nielsen the right to make a one-time irrevocable election to
continue her participation in the URS Plan, and the statute does
not include a limitation on when the election must be made.
Because Nielsen made her first and only election in 2015, we
conclude she is entitled to continue her participation in the URS
Plan.
II. Substantial Prejudice
¶23 As explained above, the Board erred in determining that
Nielsen was not entitled to elect to continue participating in the
URS Plan. We will grant relief, however, only if Nielsen has been
substantially prejudiced by the Board’s erroneous interpretation
and application of the law. Utah Code Ann. § 63G-4-403(4)(d)
(LexisNexis 2016). The record indicates that Nielsen will lose
20180010-CA 10 2019 UT App 89Nielsen v. Retirement Board
more than $550,000 over the course of her retirement if she is not
permitted to continue participating in the URS Plan. Such a loss
certainly constitutes substantial prejudice. See WWC Holding Co.
v. Public Service Comm’n, 2002 UT 23, ¶ 7, 44 P.3d 714 (“A party
has been substantially prejudiced if the alleged error was not
harmless.” (quotation simplified)).
CONCLUSION
¶24 The Board erred in determining that Nielsen was not
entitled, under Utah Code section 49-13-204(2)(c), to elect to
continue participating in the URS Plan. The Board’s error
substantially prejudiced Nielsen. We therefore set aside the
Board’s final order and instruct it to hold further proceedings
consistent with this opinion.
20180010-CA 11 2019 UT App 89