“The State continues to be responsible to public employees and others for moneys held by Trust Fund, Inc., in its pension and workers’ compensation funds. If the investment in corporate equities fails to provide a return, the taxpayers will be required to reimburse pension plans.”
How later courts described this case
- “The State continues to be responsible to public employees and others for moneys held by Trust Fund, Inc., in its pension and workers’ compensation funds. If the investment in corporate equities fails to provide a return, the taxpayers will be required to reimburse pension plans.”
- a later statute commingling pension funds with other funds and placed under the management of a private trust
- state trust fund violated constitutional provision since it was an “alter ego” of the state
Written by the judges who cited it.
The opinion
MAYNARD, Justice,
dissenting:
I respectfully dissent because I believe the decision of the majority in this case is simply wrong. This case establishes bad policy, makes bad law and reaches a bad result. To reach the result the majority wanted in this case they had to make a giant leap over a huge body of well-settled trust law. Anybody who can jump that high ought to be making Nike commercials.
All courts and all judges occasionally make bad decisions. You always hope when you do it will be in some minor matter that affects a very small number of people. Unfortunately, this decision adversely affects literally thousands of West Virginians and will have a devastating effect on all of State Government. If you were going to pick a case in which to be wrong, this is the very worst you could choose. This decision is simply a fiscal disaster.
*490 There are two fundamental flaws in this decision. First, it violates the doctrine of separation of powers by striking down a valid and legal statute and usurps the legitimate power of the legislature which enacted the statute and the executive who signed it into law. This Court is doing what all courts do everywhere in our nation today: govern by court decision. Syllabus Point 1 of this case is all that needs to be said in this decision. Just in case you missed it, here it is again:
“In considering the constitutionality of a legislative enactment, courts must exercise due restraint, in recognition of the principle of the separation of powers in government among the judicial, legislative and executive branches. Every reasonable construction must be resorted to by the courts in order to sustain constitutionality, and any reasonable doubt must be resolved in favor of the constitutionality of the legislative enactment in question. Courts are not concerned with questions relating to legislative policy. The general powers of the legislature, within constitutional limits, are almost plenary. In considering the constitutionality of an act of the legislature, the negation of legislative power must appear beyond reasonable doubt.” Syllabus Point 1, State ex rel. Appalachian Power Co. v. Gainer, 149 W.Va. 740 , 143 S.E.2d 351 (1965).
I only wish the majority really meant what they said.
Second, this ease simply ignores a very large body of the well-settled law of trusts. The legal concept of trusts has been recognized in our law for hundreds of years. -One of the basic elements of every irrevocable trust is the transfer of title of assets from the trustor to the trustee. Therefore, the person or entity holding title is the trustee and not the trustor. The West Virginia Education Association said it very well in its brief citing Syllabus Point 2 of Dadisman v. Moore, 181 W.Va. 779 , 384 S.E.2d 816 (1988):
A “trust” is a legal relation between two or more persons by virtue of which one is bound to hold property to which he has the legal title, for the use or benefit of the other or others who have an equitable title or interest. It is a right, enforceable in equity, to the beneficial enjoyment of property, real or personal, of which the legal title is in another. The person so holding the legal title or interest is called the “trustee,” and the one having the equitable interest and entitled to the benefit is the beneficiary or “cestui que trust.” The person creating the trust is called the “trustor” or “settlor.” An essential feature of trusts is the division of the title to property, the vesting of the legal title in the trustee and of the equitable title or beneficial interest in the cestui que trust.
Legal title to any stock in any corporation owned by the Trust Fund would rest solely with the trustee of the Fund and would not be held by the State.
For the foregoing reasons, I believe the statute in question does not violate our Constitution, and accordingly, I dissent.