Opinion
49235 Record No. 921860
February 25, 1994
Present: Carrico, C.J., Compton, Stephenson, Whiting, Lacy, and Keenan, JJ., and Harrison, Retired Justice
Since the Court, in an earlier related case, merely resolved a dispute over the application of a city ordinance, holding that police officers were entitled to relief they sought and did not effect a change in the law, there is no basis to limit the relief to prospective application and the judgment of the trial court is affirmed.
Practice and Procedure — Calculation of Retirement Benefits — Prospective Application of Rulings — Equity — Prejudgment Interest
In an earlier case, the Court considered the claim of former city police officers that a city had miscalculated the retirement benefits to which they were entitled and held that the retired police officers were entitled to receive two-thirds of their average final compensation without any deductions for workers' compensation or social security disability payments. On remand, the city argued that the decision in that case should be applied prospectively only and the trial court determined that the decision should be applied retroactively for a period beginning five years preceding the filing of the action. The city appeals and the police officers assigned error to the trial court's refusal to award prejudgment interest.
1. Equitable principles allow application of a decision prospectively only if (1) the decision sought to be applied retroactively established a new principle of law either by overruling clear past precedent on which litigants may have relied or by deciding an issue of first impression, (2) the retroactive application of the new rule would further retard its operation, and (3) substantial inequity would result if the new law were applied retroactively.
2. Here, the prevailing parties are seeking a remedy based on the law of the case, not retrospective application of the decision reached in another case.
3. Counsel for the city stipulated that city police officers were not covered by the workers' compensation statutes until 1975 and although that stipulation was in error, but it became part of the factual basis upon which the case is to be decided on appeal.
4. The earlier case did not effect a change in the law or establish a new principle of law which overturned past precedent or presented an issue of first impression, but merely resolved a dispute of the application of a city ordinance, which is no basis upon which to limit the relief sought to prospective application only.
5. The award of prejudgment interest is a matter left to the discretion of the trial judge (Code Sec. 8.01-382) and, even assuming that the city is liable for such interest, there is no basis to hold that the trial judge abused his discretion in denying that interest.
Appeal from a judgment of the Circuit Court of the City of Richmond. Hon. Randall G. Johnson, judge presiding.
Affirmed.
William G. Broaddus (G. Timothy Oksman, City Attorney, Michael L. Sarahan, Assistant City Attorney; Cynthia E. Hudson; McGuire, Woods, Battle Boothe, on briefs), for appellant.
Jack M. Fulton, for appellees.
In Blaylock v. City of Richmond, 243 Va. 391, 416 S.E.2d 431 (1992) (Blaylock I), this Court considered the claim of 23 former Richmond City police officers that the City had miscalculated the retirement benefits to which they were entitled under a City ordinance. Based on the record in that case, we reversed the trial court and agreed with the officers, holding that the retired police officers were entitled to "receive two-thirds of their average final compensation without any deductions for workers' compensation or social security disability payments." Id. at 395, 416 S.E.2d at 432-33.
On remand, the City argued that the decision in Blaylock I should be applied prospectively only. The police officers argued that the decision should be applied retroactively to the date at which each officer became eligible for disability retirement payments. After considering the briefs and arguments of counsel, the trial court determined that the decision should be applied retroactively for a period beginning five years preceding the filing of the action.
The trial court applied a five-year period based on the applicable statute of limitatioans in actions upon a written contract.
The City appealed the trial court's determination that the decision should be applied retroactively and the police officers assigned error to the trial court's refusal to award prejudgment interest. We awarded an appeal on both issues.
The City contends that the equitable principles which we have used in such cases as Fountain v. Fountain, 214 Va. 347, 200 S.E.2d 513 (1973), cert. denied, 416 U.S. 939 (1974), and Harper v. Virginia Department of Taxation, 241 Va. 232, 401 S.E.2d 868, vacated and remanded, ___ U.S. ___, 111 S.Ct. 2883, aff'd, 242 Va. 322, 410 S.E.2d 629 (1991), rev'd, ___ U.S. ___, 113 S.Ct. 2510 (1993), to determine whether a decision should be applied retroactively or prospectively, should be applied here. These principles allow application of a decision prospectively only if (1) the decision sought to be applied retroactively established a new principle of law either by overruling clear past precedent on which litigants may have relied or by deciding an issue of first impression whose resolution was not clearly foreshadowed, (2) the retroactive application of the new rule would further retard its operation, and (3) substantial inequity would result if the new law were applied retrospectively. Harper, 241 Va. at 237-40, 401 S.E.2d at 871-73. The City maintains that these principles are applicable to this case because the decision in Blaylock I was a change in a law upon which the City had relied in determining disability payments. This change requires a recalculation of police officers' disability retirement payments which, the City contends, if applied retroactively, would require additional payments of approximately $1.3 million. This, the City argues, constitutes a substantial inequity and, consequently, the decision should be applied prospectively only.
Initially, we note that considerations of retroactivity are normally made in cases where litigants seek the benefit of a change in the law secured by other parties in a prior case. See, e.g., Harper, 241 Va. 232, 401 S.E.2d 868; Fountain, 214 Va. 347, 200 S.E.2d 513. In this case the prevailing litigants are seeking implementation of the decision made in litigation they initiated. Whether the same result would occur in the event retired police officers other than the parties to this litigation filed an action seeking to apply the decision in Blaylock I to their retirement payments would depend on the facts and circumstances of that case. Here, the prevailing parties are seeking a remedy based on the law of the case, not retrospective application of the decision reached in another case.
[3-4] Assuming the equitable principles used for determining retroactivity are applicable in this case, applying them does not support the result sought by the City. The City erroneously characterizes the law of the case as a change in the law. The status of the police officers vis-a-vis workers' compensation coverage in 1966 was pivotal to the decision in Blaylock I. Counsel for the City stipulated that City police officers were not covered by the workers' compensation statutes until 1975. That stipulation was in error; nevertheless, it became part of the factual basis upon which this Court was required to render its decision. Blaylock I did not effect a change in the law or establish a new principle of law which overturned past precedent or presented an issue of first impression. In Blaylock I, this Court merely resolved a dispute over the application of a City ordinance, holding that the police officers were entitled to the relief they sought in that case. Under these circumstances, there is no basis to limit the relief sought by the police officers to prospective application only, and we will affirm the judgment of the trial court.
Finally, the award of prejudgment interest is a matter left to the discretion of the trial judge. Code Sec. 8.01-382. Even assuming that the City is liable for prejudgment interest, we find no basis to hold that the trial judge abused his discretion in denying prejudgment interest.
Affirmed.