Decision Number 1041

IN Re: Review of Decision of Law by Bishop Warner H. Brown, Jr., of the California- Nevada Annual Conference as to Whether or Not ¶ 1506.7 Permits the Annual Conference to Adopt a Past Service Annuity Rate that Remains the Same from One Year to the Next

Digest

An annual conference shall annually review its annuity rate for service for the purpose of adjusting the rate as appropriate. Such annuity rate may remain the same or be increased without restriction. Conflicting provisions of 2008 Discipline are to be resolved by review of the order of enactment of the conflicting provisions and also by consideration of whether a provision is general, specific, explicit, or referential. The bishop's decision of law is affirmed.

Statement of Facts

During the 2009 session of the California-Nevada Annual Conference, a recommendation from the annual conference Board of Pensions was adopted to set the 2010 Past-Service Pension Rate at $828 per year of service. The chair of the conference Board of Pensions requested a bishop's decision of law whether ¶ 1506.7 of the 2008 Discipline permits an annual conference to adopt a past-service annuity rate for retired clergy which "remains the same" from one year to the next. The request for a decision of law is as follows:

…Bishop, I rise at this point to request a Ruling of Law from you as presiding officer, regarding the adoption of Calendar Item # 2, specifically to determine whether or not Paragraph 1506.7 of the 2008 Book of Discipline permits the Annual Conference to adopt a Past-Service Annuity Rate for retired clergy which "remains the same" from one year to the next.

Bishop Warner H. Brown, Jr., issued his decision of law on July 16, 2009, which was within the thirty day time period mandated for the issuance of such decisions. The relevant portion of the bishop's decision is as follows:

Paragraph 1506.7 of the 2008 Book of Discipline, as amended by the 2008 General Conference, specifically permits an Annual Conference to adopt a Past Service Annuity Rate for retired clergy which remains the same from one year to the next. Therefore the adoption of Legislative Item # 2 by the California-Nevada Annual Conference session on June 19, 2009, is in order.

The Judicial Council considered this matter as an emergency appeal in a special meeting convened on October 31, 2009, in Durham, North Carolina, as provided in the Rules of Practice and Procedure of the Judicial Council of The United Methodist Church.

At issue are two paragraphs in the Discipline which all interested parties appear to agree are in conflict. One is ¶ 1504.1 which names certain benefit programs of the church.

One of those programs, the Clergy Retirement Security Program (CRSP) mandates an automatic increase of 2% in the Past-Service Rate (PSR) for retired clergy. In ¶ 1504.1, the Discipline adds the following statement:

The provisions of these mandatory benefit programs shall be incorporated by reference into the Discipline and shall have the full force of law as if printed in the Discipline.

The other is ¶ 1506.7 which stipulates the responsibility of the annual conference in regard to the rate for ministerial service prior to January 1, 1982. In this paragraph, the Discipline states the following:

The annual conference shall review annually the annuity rate for service rendered in the annual conference prior to January 1, 1982, for the purpose of adjusting the rate as appropriate, taking into account changes in economic conditions. Such annuity rate may remain the same or be increased without restriction.

Judicial Council Decision 1026 includes the following statement: "When provisions of the Discipline are in conflict, the later enacted provision takes precedence." The GBPHB argues, in its brief, that the relevant portion of ¶ 1506.7 was approved by the General Conference in 1996, while the automatic increase of 2% was added to the Discipline by reference in ¶ 1504.1 in 2004. From the perspective of the GBPHB, the current ¶ 1504.1 takes precedence, according to Decision 1026.

Bishop Brown, in a background statement issued at the same time as he delivered his decision of law, asserts that the Board was aware of the conflict between these two paragraphs and that the staff of GBPHB declared in writing that the Board intended to seek a change in ¶ 1506.7 at the General Conference in 2008. The proposal to be submitted would have eliminated the flexibility of an annual conference to retain an existing Past-Service Rate from one year to the next, without increasing it. "However," Bishop Brown notes, "no such petition was submitted to, or adopted by, the 2008 General Conference."

Barbara A. Boigegrain, the General Secretary of GBPHB, says in her brief, "Because the 2008 General Conference was never asked to address the PSR, the automatic 2% increase enacted in 2004 is the later enacted provision on this issue."

Jurisdiction

The Judicial Council has jurisdiction under ¶ 2609 of the 2008 Discipline

Analysis and Rationale

Decision 1026 is an important precedent in circumstances where a direct conflict between two paragraphs of the Discipline is unencumbered by other considerations. Such is not the case in the review of the decision of law by Bishop Brown.

First, the General Board of Pension and Health Benefits knew that this conflict between ¶ 1504 and ¶ 1506.7 existed prior to the 2008 General Conference and committed to petition the General Conference for an amendment to ¶ 1506.7 but failed to do so.

Second, the language of ¶ 1504.1 is opaque at best in that it grants the force of law to material which is not actually incorporated into the law of the church. This amounts to an unpublished law, which does not serve the broadest interests of the connectional church.

Third, the language of ¶ 1506.7 explicitly recognizes the changes in economic conditions that could compel an annual conference to make appropriate adjustments in its Past-Service Rate. Where the Discipline is explicit, as in this case, the Judicial Council finds greater weight than in places where the Discipline is implicit or referential.

Fourth, while the actions of the 2004 General Conference may have included later enactments in ¶ 1504.1, the actions of the General Conference in 2004 included approval of a completely new pension program for the church which could have but did not eliminate the authorizations granted to annual conferences such as the one in ¶ 1506.7.

Therefore, the statement in Decision 1026, while precedential, does not constitute an appropriate precedent for the case at hand. The existence of ¶ 1504.1, which refers to and implies the substance of the plan documents and grants them the force of law, does not overrule the existence of ¶ 1506.7, which grants explicit authority to the annual conference in the matter of setting Past-Service Rate.

In the process of discharging its duty to review annually the annuity rate for past service of the retired clergy, the annual conference is permitted to adopt the same rate or a higher rate, considering changes in economic conditions. This authority to adjust is not hindered by any restriction, except that a decrease is not permitted. The annual conference may opt to preserve the status quo, as the California-Nevada Annual Conference has done in this case. The yearly option to retain the same rate or increase it belongs to each annual conference.

Decision

An annual conference shall annually review its annuity rate for service for the purpose of adjusting the rate as appropriate. Such annuity rate may remain the same or be increased without restriction. Conflicting provisions of The Book of Discipline are to be resolved by review of the order of enactment of the conflicting provisions and also by consideration of whether a provision is general, specific, explicit, or referential. The bishop's decision of law is affirmed.

Concurring Opinion

The present request is for review of a bishop's decision of law on ¶ 1506.7 and no other provision of the Discipline. This is thus different from the recourse taken in Decision 169 and 1026 which are both for declaratory decision on the meaning, application and effect of all the related disciplinary provisions perceived as conflicting. Moreover, Decision 169 in reality gave more weight to the more specific provision relating to transfer of conference and change of boundaries and the intent of the enacting body, not to the mere date of enactment. Anent Decision 1026, it is not a unanimous one. Hence, propriety dictates that we limit our decision here to the question on ¶ 1506.7.

Paragraph 1506 deals with the powers, duties and responsibilities of annual conferences. Subparagraph 7 currently reads in relevant part:

he annual conference shall review annually the annuity rate for service rendered in the annual conference prior to January 1, 1982 for the purpose of adjusting the rate as appropriate, taking into account changes in economic conditions. Such annuity rate may remain the same or be increased without restriction. [emphasis added]

The issue is plain and simple. Does ¶ 1506.7 permit the annual conference to adopt a past service annuity rate that remains the same from one year to the next? The language of the first two sentences of the paragraph clearly resolves the question in the affirmative. It is almost self explanatory. There is no need to compare or analyze that provision vis-à-vis another one not called for in the request. But the decision under review is essentially sustainable.

In the process of discharging its mandatory duty to review annually the annuity rate for past service of the retired clergy, the annual conference is permitted to adjust, or adopt the same or higher rate, considering changes in economic or financial conditions. This upward adjustment is not hindered by any restriction. What is implicitly forbidden is a diminution or decrease. Of course, the annual conference may just opt to preserve the status quo, as what the California-Nevada Annual Conference has done in this case. The bottom line is that the yearly option to retain the same rate or hike it belongs to each annual conference. I vote to affirm the bishop's decision of law.

Ruben T. Reyes

Beth Capen joins in this Concurring Opinion.