IS THE PENSION DISQUALIFICATION ACT UNCONSTITUTIONAL

Written by on August 29, 2017

Hermilyn Armstrong v. The Attorney General

Pension Disqualification Act

In 1983, the People’s Revolutionary Government (PRG) passed Peoples Law No. 24 of 1983 (PL 24) aka the Pensions Disqualification Act (PDA) to take effect from April 4th 1983 — the same day the National Insurance Scheme (NIS) Act took effect.

On the face of it, PL 24 made civil servants, police officers, prison officers and teachers appointed after April 4th 1983 ineligible to receive a pension under the various pension laws that existed prior to that date. However, they were eligible for a pension under the NIS.

Armstrong Challenge

In 2009 Hermilyn Armstrong, upon her retirement from the public service, challenged the PDA.  She sought a declaration and an order from the court that she was entitled to benefits under the Pensions Act.

Price Findlay J.

On October 15th 2012 Price Findlay J. in the High Court ruled that Armstrong’s right under section 92(2)(b) of the Constitution was being infringed by the refusal of the government to pay her pension and gratuity in accordance with the Pensions Act.

Section 92(2)(b) of the Constitution protects the pension benefits of a public officer which existed under the law in effect at the time the officer entered the service. The effect of section 92(2)(b) is that the minimum pension benefits that a public officer is entitled to upon retirement is that which existed when the officer entered the service.

Less beneficial

There is no doubt that the pension benefits under the NIS are inferior to the benefits under the Pensions Act. For example, while under the Pensions Act Armstrong is entitled to a pension of $1,134.43 per month plus gratuity of $56,729.56, her NIS pension is only $953.77 per month and no gratuity is obtained under NIS.

PDA unconstitutional?

The decision in Armstrong has been interpreted in some quarters to mean that the PDA is unconstitutional with the effect that all public officers, no matter when they were appointed, are entitled to pension benefits under the Pensions Act. Others take the view that the decision does not have such wide application. What then is the scope of the Armstrong decision?

Material facts and applicable law

In determining a matter litigated before it, a court is concerned with the material facts of the case and the applicable legal rules and principles. The interaction of the two produces the legal rule that decides the case. The material facts are those facts considered by the court as being fundamentally important. It can be a single fact or combination of facts that makes the case before the court similar to or different from other cases. The applicable legal rules and principles include provisions in the constitution and statutes; rules of law developed in previous cases which are binding on the court; rules of law in previous cases which, though not binding are persuasive; and applicable doctrines of law pronounced by judges and legal scholars over the centuries.

Based on the decision in Armstrong, I submit that the Learned Judge considered the material facts to be:

[] That Armstrong joined the public service on May 17th 1983;

[] That at the time Armstrong joined the public service the PRG was in power;

[] That People’s Law No. 24 of 1983 (the PDA) was passed by the PRG;

[] That it is settled law that despite its four and half years of existence the PRG did not create a new legal order; and the 1974 Constitution — though suspended — was never extinct.

The important principles of law applied by the Learned Judge in Armstrong are-

That a law not passed in conformity with the provisions of the constitution is unconstitutional; and it is, by extension, null and void unless there exists some other jurisprudential basis for giving it limited validity; and

That an ordinary law that is inconsistent with a provision of the constitution is, to that extent, void.

Rule in Armstrong

Based on those material facts and principles of law the main finding in Armstrong was that PL 24 was unconstitutional, null and void.

This finding gave rise to the legal rule that: A public officer who joined the public service while PL 24 purported to be in effect is entitled to pension benefits under the Pensions Act.

But what is the period that People’s Law No. 24 of 1983 was purportedly in effect? It is the period from April 4th 1983 up to February 22nd 1985.

Why February 22nd 1985

Following the demise of the Revolution, in December 1984 general elections were held in Grenada. The newly elected parliament passed Act 1 of 1985 which, among other things, validated the PDA.  On February 22nd 1985 Act 1 was gazetted and became law. From that date the validity of the PDA was not based on the fact that it was signed by PRG Prime Minister Maurice Bishop; its authority was based on its validation by parliament by way of Act 1 of 1985.

The rule in Armstrong can therefore be restated as: A public officer who joined the public service prior to February 22nd 1985 is entitled to pension benefits under the Pensions Act

 Section 18(4) null and void

It is to be noted, that section 18(4) of the Pensions Act contained in the 2010 Edition of the Continuous Revised Laws of Grenada, which purports to incorporate the PDA as validated by Act 1 of 1985 states that-: “No pension, gratuity or other allowance under this Act shall be granted to any person first appointed to service under the Government on or after the 4th April, 1983.”

It is submitted that parliament could not on February 22nd 1985 pass a law seeking to reduce pension benefits to which a public servant was entitled prior to that date.

This is so because, as stated above, section 92(2)(b) of the Constitution guarantees that a public officer would, at a minimum, receive the pension benefits provided for under the law in existence at the time he or she entered the public service. Section 92(2)(b) of the Constitution is a deeply entrenched clause requiring the support of 2/3 of persons voting in a referendum. Act 1 of 1985 did not satisfy the referendum requirement.

Therefore, notwithstanding section 18(4), I submit that a public officer who was appointed prior to February 22nd 1985 is entitled to pension and gratuity under the Pensions Act. This is based on the finding that PL 24 was unconstitutional and by extension the Pensions Act was in force at least up until February 22nd 1984.

Post 1985 Public Officer

As regards a public officer who was appointed after February 22nd 1985 there are different considerations. Establishment of his or her entitlement to benefits under the Pensions Act, would require a court to rule that Act 1 of 1985 is unconstitutional insofar as it sought to validate PL 24. This issue was not litigated in Armstrong. It remains open.

In conclusion, the decision in Armstrong did not and could not go further than to hold that PL 24 was unconstitutional. It affects persons who joined the public service prior to February 22nd 1985 and no further.

28th August 2017

 

 

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