STEPHANIE GLENNON V STATE EMPLOYEES' RETIREMENT BOARD
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STATE OF MICHIGAN
COURT OF APPEALS
STEPHANIE GLENNON,
Petitioner-Appellee,
FOR PUBLICATION
November 20, 2003
9:15 a.m.
STATE EMPLOYEES' RETIREMENT BOARD,
No. 239646
Ingham Circuit Court
LC No. 01-093376-AA
v
Respondent-Appellant.
Updated Copy
January 30, 2003
Before: Meter, P.J., and Talbot and Borrello, JJ.
METER, P.J.
Respondent State Employees' Retirement Board appeals by leave granted from the trial
court's order granting petitioner Stephanie Glennon health insurance coverage for her dependent
daughter. Respondent contends that the circuit court misinterpreted MCL 38.20d(1) in ruling
that petitioner may receive health insurance benefits for her daughter. We agree and therefore
reverse.
Petitioner is the sole beneficiary of deceased retired state employee Roberta Ann
Glennon. Roberta Glennon died three months after she retired. As the child of a deceased
retirant, petitioner was entitled to the retirant's pension and health insurance benefits for the rest
of petitioner's life. Petitioner gave birth to a daughter after the death of Roberta Glennon. She
sought medical coverage for the child under MCL 38.20d(1), which states, in relevant part:
On and after July 1, 1974, hospitalization and medical coverage insurance
premium [sic] payable by any retirant or his or her beneficiary and his or her
dependents under any group health plan authorized by the Michigan civil service
commission and the department of management and budget shall be paid by the
retirement board from the health insurance reserve fund created in section 11.
Respondent concluded below, after a contested case hearing, that the minor child was not
entitled to benefits under this section, reasoning that the phrase "and his or her dependents"
referred to the retirant and not to the retirant's beneficiary. The circuit court reversed, stating, in
part:
The Court's analysis in this case revolves around the plain meaning of the
words "or" and "and." Webster's Dictionary defines "and" as 1. as well as; in
addition to. 2. added to; plus. It defines "or" as 1. used to connect words
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representing alternatives. In this case, the language of the statute "retirant or his
or her beneficiary" is clear. When applying the standard dictionary meanings to
the statute the Court finds that the legislature intended the words "retirant or his or
her beneficiary" to be alternatives. Either the retirant or the beneficiary. When
the retirant nominates a beneficiary, the beneficiary steps into the shoes of the
retirant. Also, the words "and his or her dependents" is used to indicate the
dependents of either the retirant or the beneficiary. In other words—the
dependent is covered in addition to either the retirant or the beneficiary.
Matters of statutory interpretation are questions of law that we review de novo.
Robertson v DaimlerChrysler Corp, 465 Mich 732, 739; 641 NW2d 567 (2002).
When reviewing matters of statutory construction, this Court's primary
purpose is to discern and give effect to the Legislature's intent. The first criterion
in determining intent is the specific language of the statute. The Legislature is
presumed to have intended the meaning it has plainly expressed, and if the
expressed language is clear, judicial construction is not permitted and the statute
is enforced as written. . . . Unless defined in the statute, every word or phrase of a
statute will be ascribed its plain and ordinary meaning. [Id. at 748 (citations
omitted).]
Moreover, this Court reviews for clear error a circuit court ruling concerning an
administrative agency's decision. See Dep't of Civil Rights ex rel Johnson v Silver Dollar Cafe,
441 Mich 110, 117; 490 NW2d 337 (1992). We will overturn the circuit court's decision only if
we are left with the definite and firm conviction that a mistake has been committed. Id. Further,
under Michigan law, a reviewing court may not substitute its judgment for that of an
administrative agency if substantial evidence supports the agency's decision, Michigan
Employment Relations Comm v Detroit Symphony Orchestra, Inc, 393 Mich 116, 124-125; 223
NW2d 283 (1974), and "[g]reat deference is accorded the construction given a statute by the
agency legislatively chosen to enforce it, which construction ought not be overruled without
cogent reasons." Buttleman v State Employees' Retirement Sys, 178 Mich App 688, 690; 444
NW2d 538 (1989).
In Buttleman, supra at 689, the petitioner appealed a circuit court order affirming a
decision of the State Employees' Retirement Board to deny the petitioner's request for duty
disability retirement benefits. This Court reasoned that the relevant statute was amenable to two
different interpretations and that, therefore, it must "defer to the statutory construction given by
the retirement board as the enforcing agency," as long as the agency's construction corresponded
with the legislative intent. Id. at 690.
Similarly, the operative language of MCL 38.20d(1) is amenable to two different
interpretations: "his or her dependents" arguably could refer to "any retirant" or to "his or her
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beneficiary."1 Given the ambiguity, we defer to respondent's interpretation—i.e., that "his or her
dependents" refers to "any retirant"—as long as this interpretation corresponds with the
legislative intent. Buttleman, supra at 690.
To determine the Legislature's intent, the entire statutory scheme should be analyzed.
Knauss v State Employees' Retirement Sys, 143 Mich App 644, 648; 372 NW2d 643 (1985).
Respondent argues that the Legislature clearly intended that the retirant nominate one, known
survivorship beneficiary as provided in MCL 38.31(2), so that only one, known survivorship
beneficiary would be entitled to pension and health insurance benefits. We agree that MCL
38.31(2) lends support to respondent's position. MCL 38.31(2) states:
Except as provided in subsections (3) and (8), the election of a payment
option under subsection (1) shall not be changed on or after the effective date of
the retirement allowance. A retirement allowance beneficiary designated under
this section shall not be changed on or after the effective date of the retirement
allowance, and shall be either a spouse, brother, sister, parent, child, including an
adopted child, or grandchild of the person making the designation. Payment to a
retirement allowance beneficiary shall begin on the first day of the month
following the death of the retirant or member.
This statute refers to one beneficiary and does not provide for unborn children or unknown heirs
as beneficiaries.
Moreover, extrinsic aids that address the problem to be resolved can be helpful in
determining legislative intent. Bennetts v State Employees Retirement Bd, 95 Mich App 616,
622; 291 NW2d 147 (1980). One extrinsic aid introduced by respondent was a memorandum
authored by Assistant Attorney General Michael Lockman, in charge of the Retirement and
Pensions Division, dated March 14, 1985, concerning the clarification of MCL 38.20d. The
memorandum was written in response to a memorandum from the director of the Bureau of
Retirement Systems asking for clarification on "covering dependents of beneficiaries who may
not necessarily be the dependents of the retirant or a deceased retirant." Lockman opined that he
was "in complete agreement with the interpretation of the Auditor General that eligibility for
dependents of a retirant for health insurance coverage must be gained through the retirant."
Lockman explained that the purpose of providing a retirement system for classified employees
was to attract and retain qualified employees and that health insurance coverage is an attractive
inducement in accomplishing the purpose of the Legislature. He stated that the bureau's practice
of offering insurance coverage to dependents of beneficiaries when these dependents were never
dependents of the retirant was "clearly not the intent of the Legislature."
1
However, we note that reading the statute in the manner suggested by petitioner—i.e., reading
"his or her dependents" to refer to "his or her beneficiary"—would essentially exclude the
retirant's dependents from coverage. This is surely a result not intended by the Legislature and
lends great credence to respondent's interpretation of the statute.
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Lockman concluded:
Accordingly, it is my opinion that the statute as presently written permits
coverage only for those persons having a relationship through the retirant. This
would include living dependents of the retirant, even though coverage for said
dependents was not previously purchased and would also include unborn children
of the retirant where the retirant is a biological parent. Such interpretation would
exclude from coverage dependents acquired by the beneficiary of a retirant
subsequent to the death of the retirant unless the subsequently acquired
dependents would have been eligible for coverage through the deceased retirant.
Although it is not strictly binding for purposes of this opinion, we nevertheless agree with
Lockman's persuasive reasoning. Indeed, interpreting MCL 38.20d(1) in the manner proposed
by petitioner would not correspond with the logical legislative intent behind the provision of
health care coverage.2
Because respondent's interpretation "does not appear to conflict with legislative intent,"
we defer to it. Buttleman, supra at 690.
Reversed.
/s/ Patrick M. Meter
/s/ Michael J. Talbot
/s/ Stephen L. Borrello
2
We note that, according to respondent, its policy for nearly twenty years has been to interpret
MCL 38.20d(1) in the manner it advocates today.
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