# Petition — Kline v. City of Fairfax

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385010_0213%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition
- **Published:** January 1, 1983
- **Citation:** 460 U.S. 1012

## Text

Supreme Court, U.S.

82-1113 FILED
| AN & 4993.
No. 82-

ER L. STEVAS
IN THE koe

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1982

LEONARD P. KLINE,
Petitioner,

City OF FAIRFAX, VIRGINIA,
Respondent.

PETITION FOR A WRIT OF CERTIORARI
TO THE SUPREME COURT OF VIRGINIA

GILBERT K. Davis
Counsel of Record

Joun D. TEw
DAVIS AND GILLENWATER
6801 Whittier Avenue
McLean, Virginia 22101
(703) 893-6011

Counsel for Petitioner

Washington, OC. « THIEL PRESS © (202) 638-4521

J

(t)

QUESTION PRESENTED

May the City of Fairfax, Virginia, compatibly with
the Fifth and Fourteenth Amendments’ proscription
against deprivation of property without due process of
law, impose an ordinance which retroactively divests
Chief Kline, the Petitioner, of his right at retirement to
be paid for his vested and unused accumulated leave?

PARTIES TO THE PROCEEDINGS

1. Leonard P. Kline, former Chief of Police for the
City of Fairfax, Virginia and the Plaintiff-Appellant
below is the Petitioner herein.

2. The City of Fairfax, a municipal corporation
organized under the laws of the Commonwealth of
Virginia, was the Defendant-Appellee below and is the
Respondent herein.

(i)

TABLE OF CONTENTS Page

QUESTION PRESENTED ....... A sthcey wks wie 4 5 ha (i)
PARTIES TO PROCEEDINGS ...... tees? eae Cacia (i)
OPINIONS AND JUDGMENTS BELOW......... ape 1
JURISDICTION......... caine Rip uds 6d bk 2
CONSTITUTIONAL AND ORDINANCE PROVISIONS..... 2
STATEMENT OF THE CASE ..........-- eve up ee 3
Factual Background ........... Faecaews ihesen 4
FEDERAL QUESTION RAISED .........-00eeeeee05 .
REASONS FOR GRANTING THE WRIT............-. 9

Where A Statute Or Contract Provides That A
Public Employee May Accumulate Leave With
Cash On Termination, The Benefit Is Vested As
Soon As Leave Is Accumulated And It Becomes
A Fixed Interest Which, As A Matter Of Con-
stitutional Due Process Should Be Protected

Against Retroactive State Action. ......++++e000. 9
A. Ordinance Provisions 2 oc cccccccccsccoseces 9
B; Vested Benefit Rights .. sc cceccccccccccves o oll

This Case Presents Issues Of General Importance

Directed To The Relationship Between Terms

Of Public Employment And Due Process Of

Law Under The United States Constitution—

Issues Which Merit The Consideration Of This

Court ....... Coveecoovresue Sccvce coeecees 13

APPENDICES:

A:
: Final Judgment Order ........00000005 coccee 28
5 Latter CORR 6 ood 0:6 6 wede biked coe ene covcce 48
: Constitutional Provisions .......+..++++e+0e++ 7a
: City of Fairfax, Virginia Ordinance 1974-4 ...,... 8a
: City of Fairfax, Virginia Ordinance 1975-27.......27a
: City of Fairfax, Virginia Ordinance 1975-52.......29a

Qrznmon

Order Denying Petition for Appeal. ...........+++ la

(it)

P
TABLE OF AUTHORITIES sa
Cases:
Bennet ex rel. Arizona State Personnel Commission v.

Beard, 27 Ariz. App. 534, 556 P.2d 1137 (1976) ........ 14
Board of Regents v. Roth, 408 U.S. 564 (1972). ....... 11,12
Christian v. County of Ontario, 399 N.Y.S.2d 379

(1977).'. wcse ne 2. 6.9 oenereeeeneeneeeeeeee oo. i a eM om 12, 18
City of Orange v. Chance, 325 SW.2d 838 (Tex. Civ.

App. 1959) O- £276.98 6.3) 2 2 = oF oe tt oe Oe Pe *oenreeee’ eoenerne eee 17
Clift v. City of at: 45 Sas Div. 2d 596, 360

N.Y.S.2d 356 (1974). ee st PM eee ee ee 17
Harryman v. Roseburg Rural Fire Protection District,

244 Ore. 631, 420 P.2d 51 (1966)..... peewee e cee 12,17
Ramey v. State, 296 Mich. 449, 296 NW. 523 (1941) .... 16,17
State of Mississippi v. Miller, 276 US. 174 (1928) ....13, 17, 18
Vangilder v. City of Jackson, 492 SW.2d 15 ass App.

EES Ge 5) sa c-dcnme ee B Pees eae 12,17
Constitutional Provisions:

PRth AMOMGMON ws cece ccenpee a OR RIC . » passim
Fourteenth Amendment, .........6++0e5+% v0.0 vale passim
Statutes and O;dinances:

Code of Virginia 1950 as Amended §15.1-7.1....... oee 049
City of Fairfax, Virginia Ordinance 1974-4 ..... nie he's 5,9
City of Fairfax, Virginia Ordinance 1975-27 ........... 7, 10

City of Fairfax, Virginia Ordinance 1975-52 ........... 7,10

IN THE
SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1982

LEONARD P. KLINE,
Petitioner,

City OF FAIRFAX, VIRGINIA,
Respondent.

PETITION FOR A WRIT OF CERTIORARI
TO THE SUPREME COURT OF VIRGINIA

Leonard P. Kline, former Chief of Police for the City
of Fairfax, Virginia, petitions for a writ of certiorari to
review the Judgment of the Supreme Court of Virginia
in this case.

OPINIONS AND JUDGMENTS BELOW

The Order of the Supreme Court of Virginia denying
the petition for writ of error was entered on October 8,
1982, and appears at page la of the Appendix to this
Petition.

2

The Final Judgment Order of the Circuit Court of
Fairfax County, Virginia, was entered on October 16,
1981, and appears at page 2a of the Appendix.

The findings and rulings of the Circuit Court of Fairfax
County, Virginia, were set forth in a letter opinion dated
July 21, 1981, and the opinion appears at page 4a of
the Appendix to this Petition.

JURISDICTION

The Order of the Supreme Court of Virginia denying
review of the dismissal of Plaintiff’s Motion for Judg-
ment was entered October 8, 1982 (App. A). A timely
Petition for Writ of Certiorari to the Supreme Court of
Virginia is hereby submitted to this Court and jurisdic-
tion is invoked under 28 U.S.C. § 1257(3).

CONSTITUTIONAL AND ORDINANCE
PROVISIONS

The Fifth and Fourteenth Amendments of the United
States Constitution are set out in the Appendix at 7a.

Ordinance No. 1974-4 providing for a system of per-
sonnel administration for employees in the career service
of the City of Fairfax, Virginia was adopted by the City
Council of the City of Fairfax, Virginia on May 21, 1974
and became effective on July 1, 1974. It is set out at
page 8a of the Appendix.

Ordinance No. 1975-27 amending the system of per-
sonnel administration was adopted on June 17, 1975 by
the City Council of the City of Fairfax and is included
at page 27a of the Appendix.

Ordinance No. 1975-52 amending the system of per-
sonnel administration was passed by the City Council

3

on October 20, 1975. It is set out at page 29a of the
Appendix to this Petition.

STATEMENT OF THE CASE

This Petition arises from the dismissal of Leonard
Kline’s Motion for Judgment against the City of Fairfax,
Virginia.

Leonard P. Kline was employed as a police officer by
the City of Fairfax from August 15, 1953 until June 30,
1977. When Mr. Kline retired in 1977, after almost
twenty-four years of service, he was Chief of Police for
the City of Fairfax and he had accrued a substantial
amount of earned, but unused, “leave’’. If Chief Kline
had retired prior to October 20, 1975, after twenty-two
years of faithful service, instead of working almost two
more years, he would have retired with a lump sum
payment for his unused leave just as many Fairfax City
employees did before October, 1975. Chief Kline,
however, relied on the fact that “leave” he had earned,
but not used due to job dedication and fortunate good
health, would be honored and compensated when he
finally retired. For this reason, and others, Chief Kline
did not retire after twenty-two years—he gave the City
of Fairfax nearly two years of additional service only to
find that the compensation he relied on and expected in
payment of his unused leave would not be honored.

Chief Kline alleged that his reliance on and expectation
of compensation for his earned leave was retroactively
undermined by the City of Fairfax and amounted to a
deprivation of property without due process of law.
The Circuit Court of Fairfax County, Virginia by letter
opinion dated July 21, 1981 and by final judgment
entered October 16, 1981 dismissed Chief Kline’s claim.

4

The Supreme Court of Virginia refused Chief Kline’s
petition for appeal on October 8, 1982.

FACTUAL BACKGROUND

Prior to July 1, 1974, employees of the City of
Fairfax accumulated “annual” and “sick” leave pursuant
to an established employee benefit plan of the City, as
follows:

An Employee could accumulate, at a prescribed rate
according to days worked, a maximum of thirty days
annual leave and an unlimited amount of unused sick
leave.

Annual leave in excess of thirty days was converted
to sick leave.

In addition to the permissible use of these categories
of leave during the term of employment, upon separa-
tion from employment, an employee received money
payment for accumulated annual leave up to the thirty
day maximum.

Also upon separation, unused sick leave would
count toward the thirty day maximum annual leave
to be paid on the basis of one day annual leave for
each three days accumulated sick leave.

In late 1973 and through the first half of 1974, the
City of Fairfax wanted to improve its personnel program
in several respects. City management was aware of
some employee unrest and was very concerned about
attempts to organize and unionize the Police Department.
(McNayr Tr. 36-38, Fleck Tr. 10-13.) There was also
concern about excessive use and abuse of sick leave by
certain employees. Moreover, a formal personnel policy
was required to be adopted by cities pursuant to state
law. Code of Virginia 1950 as Amended § 15.1-7.1. In

5

order to conform to statute, for the other specified
reasons, and to improve employee morale and produc-
tivity, the City Manager, Irving McNayr, hired Mr. Jack
Foster, retired Personnel Director of Artlington County,
Virginia, as a consultant “to come up with a program
which would be acceptable to all of the personnel and,
of course, to the City Council.” (McNayr Tr. 36-39,
41~43, 45-57, Fleck Tr. 10-11, Foster Tr. 4-7, 14-15,
21-23; see also reasons set terth in Exhibits 10-A and
10-B.)

Mr. Foster knew that the City had long experience
with certain employees using sick leave as fast as they
earned it (Foster Tr. 32), and so he proposed a modifi-
cation of the system of accumulation, use, and payment
for leave along the lines of programs in private industry.
This proposal was a part of revamping the entire person-
nel system. The change was discussed with all employees,
on both an individual and group basis. All had an oppor-
tunity to participate in the discussions, and suggested
changes were considered. When employees objected to
the fact that 2 hours less sick leave per pay period and
4 hours “bonus” per year were lost under the new
ordinance, the employees were told by management
that they had to “give up something to get something,”
i.e., the number of hours accumulated would be reduced
in return for the benefit of being paid for unused accu-
mulated hours. (Kline Tr. 131, Fleck Tr. 7-8, Foster
Tr. 7-8, McNayr Tr. 44-45, 57-58.)

Drafts of a proposed ordinance went to all employees
and to the City Council. When everyone finally con-
curred the result was the 1974 ordinance which for the
first time established a formal personnel policy and pay
plan for the City. (Foster Tr. 23-24.) By City ordinance
effective July 1, 1974 (App. p. 8a) the old employee

6

benefit plan was changed as follows: The categories of
“annual” and “sick” leave were eliminated and a single
category of “leave” was created. All earned, but unused
leave (“‘annual” and “sick’?) was combined into a new
total of “leave” (for example, thirty days “annual” and
thirty days “sick” leave became sixty days “leave’’).
Upon separation, “leave” above thirty days was to
be paid on the basis of one day for each two days accu-
mulated. No limit was established on the total number
of unused “leave” days which would be paid upon
separation from employment, except that ten days
accumulated “leave” had to be taken each year or it
was lost to the employee.

In addition to improved employee morale, benefits of
the new plan to the City were: the elimination of the
4 bonus hours of leave previously granted at the end of
each year, and two hours per pay period of sick leave.
Thereafter, the employees didn’t take sick leave as often
as they formerly took it. Also, financial cost was con-
sidered by the drafters of the original ordinance, The
cost of the program to the City would likely be less
because (1) fewer actual hours of leave would be accu-
mulated; (2) more efficiency would be obtained from
employees with higher morale who did not use sick leave
for flimsy reasons; (3) under the old system there was
a tendency of employees to use up sick leave before
retirement so that the leave was not “lost”; i.¢., no
difference if an employee was paid for not working
because he was “sick” or because he was entitled to
payment for unused leave at retirement.! (Foster Tr.

1 Actually, under the old system, an employee who used up sick
leave would be paid day for day, but he was not paid on a one for
one basis for unused leave under the new system.

7

8-9, 11-13, 18-19, 24-25, Kline Tr. 137-138, Fleck
Tr. 12-15, McNayr Tr. 43-44.)

In the spring of 1975, the City started preparing to sell
bonds to upgrade its sewer system. Auditors for the City
and a financial consultant from New York told the City
that it had to include the value of its leave program in
its financial statement. In order to reduce the City’s
“debt,” new City Manager George Hubler decided to
ask the City Council to rescind the leave portion of the
1974 ordinance, and thereby wipe out approximately ,
$150,000.00 of obligations. Mr. Hubler admitted, how-
ever, that there were options to improve the financial
statement other than retroactively taking away the right
of employees to be paid for unused leave at retirement.
He also admitted that the City was in no great financial
crisis because of its leave program. (Hubler Tr. 174-179,
185-186, 189-191, 193-196.)

On July 17, 1975, the 1974 ordinance was amended,
prospectively only, by the City Council of the City, as
follows: a limit of payment for forty-five days “leave”
was to be paid upon separation, for all “leave” accrued
subsequent to June 17, 1975. “Leave” in excess of
thirty days was to be paid on a ratio of one day for each
two days accrued.

On October 20, 1975, the City Council of the City
again amended the ordinance by reconstituting the
“leave” for the period prior to July 1, 1974, into
“annual” and “sick” leave designations. All leave over
thirty days was now to be paid on a ratio of one day
for each two days accrued. The ordinance stated that,
“No payment will be made for sick leave accrued upon
separation or retirement from City service.’ The Council
made these provisions retroactive.

As a result of the actions taken by the City on Octo-
ber 20, 1975, Leonard Kline lost the right to be paid for
his unused leave at the time of his separation from
employment (in his case by retirement) from the City.
Prior to October 20, 1975, Chief Kline could have
retired and received a lump sum payment (certain former
employees of the City did just that); after the council
meeting of October 20, 1975, such payment could not
be obtained. (Kline Tr. 123-124.) It is on the basis of
a retroactive taking of vested rights that the Petitioner
brought his action for deprivation of property without
due process of law.

FEDERAL QUESTION RAISED

Petitioner seeks review of issues involving the Fifth
and Fourteenth Amendments of the Constitution of the
United States which were timely raised below and
decided adversely to the Petitioner. The Federai Consti-
tutional provisions protect against the deprivation of
property without due process of law yet the City of
Fairfax, Virginia, in violation of these amendments,
passed an ordinance that retroactively divested Chief
Kline of his right to compensation for earned but unused
leave accumulated prior to October 20, 1975. This Court
is presented with an opportunity to consider and clarify
the important question of whether leave benefits of a
public employee, earned during the period of employ-
ment, are vested property rights within the meaning of
the Fifth and Fourteenth Amendments such that they
will be protected against retroactive deprivation by state
action.

9

REASONS FOR GRANTING THE WRIT

WHERE A STATUTE OR CONTRACT PROVIDES
THAT A PUBLIC EMPLOYEE MAY ACCUMULATE
LEAVE WITH CASH ON TERMINATION, THE
BENEFIT IS VESTED AS SOON AS LEAVE IS
ACCUMULATED AND IT BECOMES A FIXED
INTEREST WHICH AS A MATTER OF CONSTITU-
TIONAL DUE PROCESS SHOULD BE PROTECTED
AGAINST RETROACTIVE STATE ACTION,

1, Ordinance Provisions.

This case presents the spectacle of a Virginia munici-
pality granting by ordinance certain compensation and
leave benefits to its employees only to retroactively
divest said employees of accumulated benefits when the
City later had a need to improve the appearance of its
financial statement.

In late 1973 and early 1974 the City of Fairfax was
concerned about employee unrest and the possibility of
Teamster organization of the Police Department. In
addition, the City was under statutory mandate to
formulate official personne. policies. Code of Virginia
1950 as amended § 15.1-7.1. To conform to state law,
and in order to improve employee relations, the City
adopted Ordinance 1974-4 on May 21, 1974 which
provided that, “After successful completion of the
probationary period, the employee [would be] entitled
to the full benefits of a Career Service employee as
provided by [the] ordinance.” One such benefit was
agreed to as follows:

Upon separation or retirement an employee shall be

paid in full for all accrued leave up to a maximum
of 30 work days (240 hours). Leave in excess of

10

30 days shall be paid on a ratio of one day for each
two days accrued,

In late spring of 1975, barely one year after the formu-
lation of the City’s system of personnel administration,
a prospective amendment of Ordinance 1974-4 was
passed by the City Council. City of Fairfax, Virginia,
Ordinance 1975-27. The newly formalized leave benefits
were trimmed as far as future compensation of accu-
mulated leave was concerned. Since this action was
prospective in nature, Petitioner has no due process
argument with the validity of the Ordinance. The new
benefit provision read as follows:

Upon separation or retirement an employee shall be
paid in full for all accrued leave up to a maximum
of 30 work days (240 hours). Leave in excess of
30 days shall be paid on a ratio of one day for each
two days accrued, not to exceed payment for 15
additional days (120 hours). This 45-day limit
shall apply for leave accrued from the date of the
adoption of this ordinance.

(Emphasis added.)

Within three months the City Council once again
amended Ordinance 1974-4 by reconstituting leave accu-
mulated prior to July 1, 1974 into “annual” and “sick”
leave. City of Fairfax, Virginia Ordinance 1975-52.
Leave accrued after July 1, 1974 and up to the adoption
of the amendment was to be treated as “‘annual’’ leave.
After the date of the amendment, “sick” leave would
accrue for full-time employees at the rate of four hours
for each two week pay period. Upon separation or
retirement the new amendment allowed payment for
“annual” leave accumulated as follows:

Up to a maximum of 30 days accrued annual leave
shall be paid on the basis of one day for each day

11

of annual leave accrued. Accrued annual leave in
excess of 30 days shall be paid on a ratio of one day
for each two days accrued.

“Sick” leave was dealt with summarily:

No payment will be made for sick leave accrued
upon separation or retirement from City Service.

This new amendment, of course, had the effect of
retroactively divesting long term employees of all leave
accumulated prior io July 1, 1974 that was “reconsti-
tuted” into “sick” leave. In Chief Kline’s case his leave
balance was reconstituted into 1,587 hours “sick” leave
and 355 hours ‘‘annual”’ leave. Thus, the value of his
retroactively divested “sick” leave was $12,763.42.
(Trial Exhibit 38.)

2. Vested Benefit Rights,

It has been stated that the Federal Constitution’s
procedural protection of property is a safeguard of the
security of interests that a person has already acquired
in specific benefits. These interests—property rights—
can take many forms. See, Board of Regents v. Roth,
408 U.S. 564 (1972). As elaborated in Roth:

To have a property interest in a benefit a person
must have more than an abstract need or desire for
it. He must have more than a unilateral expectation
of it. He must, instead, have a legitimate claim of
entitlement to it. It is a purpose of the ancient
institution of property to protect those claims upon
which people rely in their daily lives, reliance that
must not be artibrarily undermined.
* * *
Property rights, of course, are not created by the

Constitution. Rather they are created and their
dimensions are defined by existing rules or under-

12

standings that stem from an independent source
such as state law—rules or understandings that
secure certain benefits and that support claims of
entitlement to those benefits.

408 U.S, 564, 577.

“Leave” is a claim upon which employees rely in their
daily lives and they have more than an abstract need for
such benefits. An employee typically plans his vacation,
determines the wisdom of taking sick days and even
considers his retirement based on his reliance on earned
leave being h. xored, It is with this in mind that courts
have stated that leave benefits are part of an employee's
overall compensation earned during the period of em-
ployment. See, Vangilder v, City of Jackson, 492 S.W.2d
15 (Mo. App. 1973). Moreover, it has been held (in
keeping with the Roth Court’s view that property rights
are created and defined by existing rules such as state
laws), that where a statute provides that employees may
accumulate leave with cash payment on termination, the
leave benefit is not contingent, but is vested as soon as
the leave is accumulated. Christian v, County of Ontario,
399 N.Y.S, 2d 379 (1977); Harryman v, Roseburg Rural
Fire Protection District, 244 Ore. 631, 420 P.2d 51
(1966).

Chief Kline has been deprived of a vested property
interest created by City ordinance—a specific benefit
was earned by Chief Kline and he relied on it being
honored, not retroactively rescinded.

13

THIS CASE PRESENTS ISSUES OF CENERAL
IMPORTANCE DIRECTED TO THE RELATION-
SHIP BETWEEN TERMS OF PUBLIC EMPLOYMENT
AND DUE PROCESS OF LAW UNDER THE UNITED
STATES CONSTITUTION—ISSUES WHICH MERIT
THE CONSIDERATION OF THIS COURT.

In State of Mississippi v. Miller, 276 U.S. 1974 (1928),
a statute which retroactively reduced the amount of
compensation that a revenue agent was to receive was
reviewed by this Court. In invalidating the statute, the
Court stated as follows:

It is well understood that the contract clause does
not limit the power of a state during the terms of
officers to pass and give effect to laws prescribing
for the future the duties to be performed by, or the
salaries or other compensation to be paid to, them.
Butler v, Pennsylvania, 10 How, 402, 13 L. Ed.
472. But, after services have been rendered by a
public officer under a law specifying his compensa-
tion, there arises an implied contract under which
he is entitled to have the amount so fixed. And the
constitutional protection extends to such contracts
just as it does to those specifically expressed.
The selection of plaintiff to be the revenue agent
amounted to a request or direction by the state that
he exert the authority and discharge all the duties
of that office. In the performance of services so
required of him plaintiff made the investigations
and brought the suits to discover and collect the
delinquent taxes. Under the statutes then in force
as construed by the highest court of the state, he
thereupon became entitled to the specified per-
centages of the amounts subsequently collected

on account of the taxes sued for, The retroactive
application of Chapter 170 would cake from him
a part of the amount that he had theretofore

14

earned. That would impair the obligation of the
implied contract under which he became entitled
to the commissions, This case is ruled by Fisk v.
Jefferson Police Jury, 116 U.S. 131, 6 S. Ct. 329,
29 L. Ed. 587.

This Court has thus recognized that although it may
be correct that public employees have no contractual or
vested right to the public office itself, it does not neces-
sarily follow that contractual or vested rights in benefits
of the office cannot accrue. This fact was also recognized
in Bennett ex rel. Arizona State Personnel Commission
v. Beard, 27 Ariz. App. 534, 556 P.2d 1137 (1976). In
Beard, an employee of the Arizona Highway Department
brought suit to invalidate an action by the Arizona State
Personnel Commission. The Commissior had instituted
a new policy under which annual leave would accrue at
the rate of only ten hours per month as compared to
the prior rate of twelve hours per month. This change
resulted in the plaintiff being entitled to only fifteen
days annual leave instead of the eighteen days he had
previously enjoyed. Unlike the action taken in the case
at bar, however, this change was not made retroactive.
Since the change was prospective only, the court held
that the plaintiff had no contractual right to continue
his past leave benefits into future employment. The
Commission’s prospective change could be invalidated
only if it was in violation of a formal written contract
or a statute prohibiting such a change.

The Court in Beard made it clear that if the change
had been made retroactive, it would have been invali-
dated. In reaching this conclusion, the court agreed that
public employees have no contractual or property right
to continued employment. However, according to the
court, that principle of law should not prevent a court

15

from invalidating any retroactive impairment of rights
which have already vested. The court stated:

The state, having the right to take the most
drastic step involved with appellee’s “contract of
employment”’—termination—without liability, may
the state without liability take the less drastic step
of changing the terms of appellee’s future employ-
ment by way of compensation, that is, benefits?
The answer is obviously yes, provided that the
change does not impair rights vested by reason of
the prior employment. Yeazell v. Copins, [98 Ariz.
109, 402 P.2d 541 (1965)]. Under this analysis,
the commission could not, say in July, 1969, pass
a rule that provided that retroactive to January 1,
1969, appellee’s leave benefits would be computed
at a rate less than was previously in effect from
January 1, 1969 to July, 1969. Such a result is
prohibited by Yeazell as affecting benefits vested by
reason of appellee’s compliance with the conditions
precedent to earning those benefits—his continued
employment during that period.

536 P.2d at 1140 (Court’s emphasis).

Accordingly, the key to determining whether rights
have vested is whether all of the conditions precedent to
the earning of the benefits have been satisfied. In Beard,
there was only one condition with whicl. it was necessary
for the employer to comply in order for his rights to
vest—his continued employment during the period when
the prior law was in effect. Since he had satisfied that
condition, he had acquired vested rights of which he
could not be retroactively deprived by the government.
Based on such reasoning, the Petitioner, Chief Kline,
had a vested right in payment of accrued leave according
to the terms of the prior ordinance. Like the plaintiff
in Beard, Chief Kline was required to comply with only

16

one condition subsequent in order for his rights to vest —
continued employment during the period when the
prior law was in effect. Having complied with that
requirement, Leonard Kline acquired a vested right of
which the municipality could not lawfully deprive him.

In a similar case, a Michigan court held that the
plaintiffs, inspectors employed by the Public Service
Commission, by continuing their employment through
the duration of the period for which the law in question
was in effect, had acquired a vested right in the benefits
provided for in that law. Ramey v. State, 296 Mich. 449,
296 N.W. 323 (1941). The law provided that employees
in the classified civil service were to be given vacations
with pay and that any such employee who was separated
from employment without having taken his vacation was
to be compensated for that unused benefit. Later, the
plaintiffs’ positions were removed from the classified civil
service, on the basis of which the state argued that they
were not entitled to reimbursement for unused vacation
time. The court held that since the employees had
acquired vested rights to the benefits, it was unlawful
for the state to have deprived them of the benefits. The
court stated as follows:

“Under the facts in this case, plaintiffs had per-
formed all acts necessary to insure to themselves
the right of a vacation with pay, or if dismissed
before exercised, to receive compensation for the
unused portion of their annual leave allowances.
There was nothing remaining for them to do except
exercise the right which depended on no contin-
gency, but was complete and matured. In my
opinion, vacation with pay is not a gratuity; it is
compensation for services rendered, It is a rule that
after the services are rendered under a law which
fixes the rate of compensation, there arises an

17

implied contract to pay for those services at that
rate and the contract cannot be impaired by subse-
quent legislation.” Fisk v. Jefferson Police Jury,
116 U.S. 131, 6 S. Ct. 329, 29 L. Ed. 587; Robert-
son v. Miller, 276 U.S. 174, 48 S.Ct. 266, 72
L, Ed. 517.

296 N.W. at 325.

According to the court in Ramey, not only did the
plaintiffs have a vested right to the benefits, they also
had an implied contract which could not be impaired by
subsequent legislation. This interpretation is consistent
with this Court’s view in State of Mississippi v. Miller,
276 U.S. 1974 (1928).

State courts in numerous other cases have held that
vested rights to employment benefits cannot be taken
away from a public employee. See Clift v. City of
Syracuse, 45 App. Div. 2d 596, 360 N.Y.S.2d 356
(1974) (the court held that an employee who had been
discharged before he could use his accumulated sick leave
was deprived of property without due process, since
vacations are conditions of employment, not gratuities);
Vangilder v. City of Jackson, 492 S.W.2d 15 (Mo. App.
1973) (sick leave benefits were held to be part of an
employee’s overall compensation, earned during the
period of his employment and forming a part of his
employment contract); Harryman v. Roseburg Rural Fire
Protection District, 244 Ore. 631, 420 P.2d 51 (1966)
(the court rejected the argument that sick leave was mere
gratuity for city employees and held that since the
plaintiff had accepted employment on the assumption
that sick leave was part of his compensation for services,
it was a contractual term of employment); City of
Orange v. Chance, 325 S.W.2d 838 (Tex. Civ. App.
1959) (payment for unused sick leave was not merely a

18

gratuity, but rather was part of the employee’s overall
compensation),

For the reasons discussed above, the divesting of Chief
Kline’s right to be paid for his unused leave was a taking
of property without due process of law. The City’s
action is comparable to giving an employee a bonus
contingent on his continued work for a specified period.
After the period passes and the bonus vests, the bonus
is abolished without notice or a hearing. Whether a
municipality may pass an ordinance such as the one
involved here and abolish vested property rights without
notice is an issue worthy of review by this Court.

CONCLUSION

This Court should take this case for its full review.
From the above, one of the last analogous decisions of
this Court on the subject of divesting public employee
entitlements is State of Mississippi v. Miller, 226 U.S.
1974 (1928). Today, public employees are increasingly
compensated by what are often termed “fringe benefits”
in addition to salary. No doubt, benefits such as the
right of Chief Kline to be paid for his unused leave in
accordance with a local law should not be thought of
as on the “fringe” of his total compensation package;
rather the entitlement to be paid on retirement is an
elemental part of that package which constituted his
remuneration for faithful public service. See, e.g.,
Christian v. County of Ontario, 399 N.Y.S.2d 379
(1977), Elemental fair dealing is at odds with the City
of Fairfax in this case, and elemental fairness is at the
heart of the due process clause. The tangible rewards of
public service are too few to permit further discourage-
ment to those who consider careers as servants of us all.
The millions of public servants, both state and federal,

19

look to this Court to condemn arbitrary action, including
the divesting of accrued entitlements. This case is impor-
tant to these millions, and is worthy of this Court’s full
attention and decision. The issue is simple, the facts are
uncomplicated, the import is far reaching, the need for
the highest precedence is clear. This petition should be
granted,

Respectfully submitted,

GILBERT K. Davis
Counsel of Record

Joun D. Tew

DAVIS AND GILLENWATER
6801 Whittier Avenue
McLean, Virginia 22101
(703) 893-6011

Counsel for Petitioner

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385010_0213%3A1. Public record. Not legal advice.
