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Erene Briese v. Montana Public Employees

September 4, 2012

ERENE BRIESE, PETITIONER AND APPELLANT,
v.
MONTANA PUBLIC EMPLOYEES' RETIREMENT BOARD, RESPONDENT AND APPELLEE.



APPEAL FROM: District Court of the First Judicial District, In and For the County of Lewis and Clark, Cause No. CDV 10-982 Honorable Kathy Seeley, Presiding Judge

The opinion of the court was delivered by: Beth Baker

Submitted on Briefs: May 16, 2012

Decided: September 4, 2012

Filed:

Clerk

Justice Beth Baker delivered the Opinion of the Court.

¶1 The Montana Public Employees' Retirement Board (MPERB) denied death benefits*fn1 to Petitioner Erene Briese (Erene) because her deceased husband, who had originally named her as his beneficiary under the Montana Sheriffs' Retirement System (SRS), had later filed a new designation, dropping her as a beneficiary, while marital dissolution proceedings were pending. Erene appealed to the District Court, which affirmed the MPERB's order. Erene now appeals the District Court's order. We reverse.

¶2 We consider the following issues on appeal:

¶3 1. Did Erene's application for and acceptance of benefits on behalf of the children render her claim moot or waive her right to challenge the beneficiary designation?

¶4 2. Does a temporary restraining order issued in a marital dissolution proceeding under § 40-4-121(3), MCA, apply to the designation of a beneficiary under the Sheriffs' Retirement System?

PROCEDURAL AND FACTUAL BACKGROUND

¶5 Erene's late husband, David Briese (David) was a member of the SRS as a result of his employment as a deputy sheriff for Yellowstone County. The SRS is administered by the Montana Public Employees' Retirement Administration (MPERA), and governed by the MPERB. In 2001, David designated Erene as his primary beneficiary under the SRS plan.

¶6 In 2004, David filed a petition for dissolution of marriage. Under § 40-4-121(3), MCA, the dissolution court issued a standard temporary restraining order that restrained both parties from disposing of property, except in the usual course of business or for the necessities of life, without either the consent of the other party or an order of the court, or from changing the beneficiaries of "insurance or other coverage . . . held for the benefit of a party . . . ." In August 2006, while the marital dissolution proceedings were still pending, and without consent of Erene or the court, David filed a new designation with the SRS, dropping Erene as beneficiary and naming instead their two minor children. David was killed in the line of duty a few months later, in November 2006. At the time of his death, David and Erene were separated but not divorced.

¶7 Erene apparently learned of the 2006 change in beneficiary in early 2008. Counsel for Erene sent a letter to MPERA notifying the agency that Erene considered the 2006 change of beneficiaries to be void because it was done in violation of the temporary restraining order. MPERA wrote back, stating that it was statutorily obligated to honor the 2006 designation of David and Erene's children as beneficiaries, and instructing Erene, as the surviving parent of the minor children, to choose among various options for payment. Erene responded by submitting the necessary forms to activate monthly payments to Erene for the benefit of the children.

¶8 In 2009, Erene discovered that the payment of benefits to the children rather than to her had adverse tax consequences for the family, and she sought again to have David's 2001 beneficiary designation enforced by MPERA. MPERA issued an "administrative decision," again denying Erene's request, and informing her of her right of administrative appeal. Erene appealed to the MPERB, which also denied her request.

¶9 In December 2009, Erene requested that the MPERB's denial of benefits be formally reviewed by a hearing examiner under the Montana Administrative Procedure Act (Title 2, chapter 4, MCA). By agreement of the parties, no hearing was held. The hearing examiner proposed, and the MPERB adopted, a final order holding that (1) Erene waived her right to contest the validity of the 2006 beneficiary designation when she applied for benefits on behalf of her children; (2) the issue was moot because, once benefits were granted to her children, the parties could not be restored to their original positions; and (3) the temporary restraining order in the dissolution proceedings was not applicable to an SRS beneficiary designation.

¶10 Erene petitioned the First Judicial District Court for judicial review of the MPERB's final order. The District Court affirmed the order without addressing the waiver or mootness arguments, finding that the temporary restraining order did not apply to David's designation of SRS beneficiaries.

STANDARD OF REVIEW

¶11 On judicial review of an agency's decision subject to the Montana Administrative Procedure Act, a district court reviews findings of fact for clear error and conclusions of law for correctness. Micone v. Dept. of Pub. Health & Human Servs., 2011 MT 178, ¶ 10, 361 Mont. 258, 258 P.3d 403 (citing In re Fair Hearing of Hofer, 2005 MT 302, ¶¶ 13-14, 329 Mont. 368, 124 P.3d 1098). The same standard applies to our subsequent review of the district court decision. Micone, ¶ 10. A district court's interpretation of a statute is a conclusion of law, which we review for correctness. In re Marriage of Funk, 2012 MT 14, ¶ 6, 363 Mont. 352, 270 P.3d 39 (citing In re C.D.H., 2009 MT 8, ¶ 21, 349 Mont. 1, 201 P.3d 126).

DISCUSSION

¶12 1. Did Erene's application for and acceptance of benefits on behalf of the children render her claim moot or waive her right to challenge the beneficiary designation?

¶13 Before reaching the substantive issue in this appeal, we address MPERB's claims that the issue is moot, or that Erene waived her claim when she applied for benefits on behalf of her minor children.

¶14 Mootness is a threshold issue which must be resolved before addressing the underlying dispute. Med. Marijuana Growers Ass'n v. Corrigan, 2012 MT 146, ¶ 18, ___ Mont. ___, ___ P.3d ___ (citing Povsha v. City of Billings, 2007 MT 353, ¶ 19, 340 Mont. 346, 174 P.3d 515). The mootness doctrine is one of several doctrines designed to limit the judicial power of this Court to justiciable controversies-that is, controversies "upon which a court's judgment will effectively operate, as distinguished from . . . dispute[s] invoking a purely political, administrative, philosophical, or academic conclusion." Progressive Direct Ins. Co. v. Stuivenga, 2012 MT 75, ¶ 16, 364 Mont. 390, 276 P.3d 867. The fundamental question to be answered in any review of possible mootness is "whether it is possible to grant some form of effective relief to the appellant." Stuivenga, ¶ 37.

¶15 MPERB claims that it is impossible to grant effective relief to Erene because, once the payments commenced, MPERB had fully discharged its obligations under the law. MPERB cites § 19-2-803, MCA, in support ...


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