When does Tennessee stop the state retirement benefits of an employee convicted of a felony arising from their job?

Subject

Opinion No. 13-78, State Retirement Benefits—Effect of "Conviction" Under Tenn. Code Ann. § 8-35-124, October 21, 2013

Plain-English summary

First Deputy Treasurer Steve Curry asked when a state employee's retirement benefits should stop after the employee is "convicted" of a felony arising from the job. The AG said benefits must stop on the verdict or plea, before any sentence is imposed. The triggering event is one of: a guilty verdict by a jury, a finding of guilt by a judge in a bench trial, or the entry of a plea of guilty or nolo contendere.

This required parsing what "conviction" means under Tennessee law. State v. Vasser (Tenn. Crim. App. 1993) had recognized two meanings: a general meaning (the result of a criminal trial ending in a judgment that the accused is guilty) and a technical meaning (involving both a verdict and the entry of a sentence). The technical meaning normally controls for "civil disabilities" (like loss of pension benefits), because civil disabilities are strictly construed.

But the technical meaning applies only "absent statutory definition to the contrary." Here, Tenn. Code Ann. § 8-35-124(b) provided a contrary definition by saying benefits stopped "[u]pon initial conviction, or upon a plea of guilty or nolo contendere." The juxtaposition was telling. A plea doesn't include a sentence. So if "initial conviction" required a sentence, the two prongs would trigger at different stages, which would be incoherent. The only consistent reading was that both prongs trigger at the same stage: when guilt is established by verdict, judicial finding, or plea, before sentencing.

The result: benefits stop early, on the day of the verdict or plea, not at sentencing weeks or months later. This benefits Tennessee and TCRS by preventing further payouts during the pendency of post-verdict motions and sentencing proceedings.

Currency note

This opinion was issued in 2013. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Tenn. Code Ann. § 8-35-124 has been amended multiple times, expanding the categories of forfeiting felonies and adjusting procedural rules. Anyone administering a current forfeiture decision should pull the current statute, current TCRS rules, and any subsequent AG opinions clarifying the timing.

Background and statutory framework

The forfeiture statute. Tenn. Code Ann. § 8-35-124(a)(1) prohibited employees, elected officials, or appointed officials from receiving TCRS benefits if "convicted in any court of this state of a felony arising out of the employee's or official's employment or official capacity, constituting malfeasance in office." Subsection (a)(2) extended this to convictions in any state or federal court, "[n]otwithstanding any other law to the contrary."

Enforcement procedure. Tenn. Code Ann. § 8-35-124(b)(1): "Upon initial conviction, or upon a plea of guilty or nolo contendere, any person subject to the provisions of this section shall . . . [h]ave the employee's or official's benefit stopped immediately, if the employee or official is receiving a benefit."

Two meanings of "conviction." State v. Vasser, 870 S.W.2d 543, 545-46 (Tenn. Crim. App. 1993), summarized the distinction. General meaning: a "conviction" is the result of a criminal trial ending in a judgment of guilt. Technical meaning: requires both a verdict and a sentence. Authority for the technical meaning: McClain v. State (1948); Ray v. State (Tenn. Crim. App. 1978); Spencer v. State (1911); Vasquez v. Courtney (Or. 1975).

Civil disabilities and the technical meaning. Vasquez v. Courtney, 537 P.2d 536, 537 (Or. 1975), and the Vanderbilt Law Review's Special Project, The Collateral Consequences of a Criminal Conviction (1970), held that "civil disabilities" are penal in nature and strictly construed, with the majority rule being that the technical meaning applies. In re S.J.K., 867 N.E.2d 408, 412 (Ohio 2007), defined civil disability as "[t]he condition of a person who has had a legal right or privilege revoked as a result of a criminal conviction."

Statutory consistency rule. In re Estate of Davis, 308 S.W.3d 832, 839 (Tenn. 2010), quoting Marsh v. Henderson, 221 Tenn. 42, 424 S.W.2d 193, 196 (1968), required that "statutory language . . . should be construed, if practicable, so that its component parts are consistent and reasonable."

Common questions

What kinds of felonies trigger pension forfeiture?

The statute requires the felony to "arise out of the employee's or official's employment or official capacity" and constitute "malfeasance in office." A street drug offense unrelated to the job would not trigger forfeiture. Theft from the employer, official misconduct, official bribery, embezzlement of public funds, and similar offenses would.

Can the employee or family keep contributions the employee paid into TCRS?

The opinion did not address this. The statute distinguishes between (1) accrued employer contributions/benefits and (2) the employee's own contributions. TCRS rules generally allowed the employee to recover personal contributions in a forfeiture case, though that's an administrative question for TCRS.

What happens if the conviction is later reversed on appeal?

If a verdict or plea is later vacated on appeal, the employee or beneficiary may seek restoration. The statute and TCRS procedures provide for adjustments based on the final disposition. But pending the appeal, benefits remain suspended.

How does a nolo contendere plea affect this?

A nolo plea (no-contest) is treated the same as a guilty plea for purposes of § 8-35-124(b). Benefits stop on entry. Nolo pleas are commonly used by public officials seeking to limit collateral consequences in related civil cases, but pension forfeiture is not avoided by choosing nolo over guilty.

Why did Tennessee adopt this forfeiture rule?

The pension forfeiture statute reflects the policy that taxpayers should not continue funding the retirement of public employees who criminally betrayed the trust placed in them. It's a strong financial deterrent against public corruption.

Citations

Tenn. Code Ann. §§ 8-35-124, 8-35-124(a), 8-35-124(a)(1), 8-35-124(a)(2), 8-35-124(b), 40-20-101, 40-23-101. Tenn. R. Crim. P. 32(e). Cases: State v. Vasser, 870 S.W.2d 543 (Tenn. Crim. App. 1993); Vasquez v. Courtney, 272 Or. 477, 537 P.2d 536 (1975); McClain v. State, 186 Tenn. 401, 210 S.W.2d 680 (1948); Ray v. State, 576 S.W.2d 598 (Tenn. Crim. App. 1978); Spencer v. State, 125 Tenn. 64, 140 S.W. 597 (1911); In re S.J.K., 867 N.E.2d 408 (Ohio 2007); In re Estate of Davis, 308 S.W.3d 832 (Tenn. 2010); Marsh v. Henderson, 221 Tenn. 42, 424 S.W.2d 193 (1968).

Source

• Landing page: https://www.tn.gov/attorneygeneral/opinions.html
• Original PDF: https://www.tn.gov/content/dam/tn/attorneygeneral/documents/ops/2013/op13-078.pdf

Original opinion text

October 21, 2013

Opinion No. 13-78

State Retirement Benefits—Effect of "Conviction" Under Tenn. Code Ann. § 8-35-124

QUESTION

When should the retirement benefits of a State employee or official who has been "convicted" of "a felony arising out of the employee's or official's employment or official capacity, constituting malfeasance in office" be terminated under Tenn. Code Ann. § 8-35-124?

OPINION

Under Tenn. Code Ann. § 8-35-124, the benefits that an employee or official of the State is entitled to receive from the Tennessee Consolidated Retirement System must be terminated upon a verdict of guilty by a jury, a finding of guilt by a judge in a bench trial, or the entry of a plea of guilty or nolo contendere of "a felony arising out of the employee's or official's employment or official capacity, constituting malfeasance in office."

ANALYSIS

The termination of retirement benefits of a Tennessee employee or official after a felony conviction is governed by Tenn. Code Ann. § 8-35-124(a)(1), which provides:

No employee or elected or appointed official of the state or any political subdivision thereof shall be entitled to receive retirement benefits from the Tennessee consolidated retirement system, any superseded retirement system or any other public pension system, if such employee or official is convicted in any court of this state of a felony arising out of the employee's or official's employment or official capacity, constituting malfeasance in office.

The same prohibition applies in the case of any such conviction "in any state or federal court" "[n]otwithstanding any other law to the contrary." Tenn. Code Ann. § 8-35-124(a)(2). The manner in which these prohibitions are to be enforced is defined by Tenn. Code Ann. § 8-35-124(b), which states:

(b) Upon initial conviction, or upon a plea of guilty or nolo contendere, any person subject to the provisions of this section shall:

(1) Have the employee's or official's benefit stopped immediately, if the employee or official is receiving a benefit.

The Tennessee Court of Criminal Appeals has noted that two distinct meanings of the term "conviction" exist under Tennessee law, explaining as follows:

In a general sense, a "conviction" has been defined as "the result of a criminal trial which ends in a judgment or sentence that the accused is guilty as charged." Black's Law Dictionary 333 (6th ed. 1990). In one sense, it is viewed as necessarily including the judgment on the finding of guilt or verdict. In McClain v. State, 186 Tenn. 401, 210 S.W.2d 680, 681 (1948), the Court stated that absent "a minute entry showing that the Trial Judge approved the verdict . . . and sentenced the Defendant, the conviction of guilt is incomplete." Accord Ray v. State, 576 S.W.2d 598, 602 (Tenn. Crim. App. 1978); Spencer v. State, 125 Tenn. 64, 69-70, 140 S.W. 597, 598-599 (1911) (technically, "a conviction involves, not only a verdict, but also a sentence passed by the court"). In fact, this has been called the "technical" meaning of "conviction." Vasquez v. Courtney, 272 Or. 477, 537 P.2d 536, 537 (1975).

Actually, the technical meaning is used in terms of requiring a "judgment of conviction." See Tenn. R. Crim. P. 32(e) ("judgment of conviction shall set forth the plea, the verdict or findings, and the adjudication and sentence"). In this sense, the judgment provides the legal authority for the executive branch of government to incarcerate a person who is sentenced to confinement. See T.C.A. §§ 40-20-101, 40-23-101. Also, the technical meaning is normally used, absent statutory definition to the contrary, when referring to the indirect or subsequent consequences which might result, such as, future civil disabilities. See Vasquez v. Courtney, 537 P.2d at 537–538 and cases cited therein.

State v. Vasser, 870 S.W.2d 543, 545-46 (Tenn. Crim. App. 1993) (emphasis added). In Vasquez v. Courtney, cited by the Tennessee Court of Criminal Appeals, the Supreme Court of Oregon observed that "[c]ivil disabilities are considered penal in nature and are strictly construed" and concluded that "[w]here civil penalties and disabilities are involved . . . , a large majority of jurisdictions accept the technical meaning of 'conviction' and hold that conviction takes place only after a determination of guilt and a pronouncement of the judgment of the court." Vasquez v. Courtney, 537 P.2d 536, 537 (Or. 1975) (emphasis added). The Oregon Supreme Court based this conclusion on a survey of state decisions summarized in an issue of the Vanderbilt Law Review addressing the consequences of criminal convictions. Id. at 538 n.2 (citing Special Project, The Collateral Consequences of a Criminal Conviction, 23 Vand. L. Rev. 929, 953-54 (1970)).

The denial of benefits from the Tennessee Consolidated Retirement System is a civil disability. A "civil disability" is defined as "[t]he condition of a person who has had a legal right or privilege revoked as a result of a criminal conviction." In re S.J.K., 867 N.E.2d 408, 412 (Ohio 2007) (citing Black's Law Dictionary 494 (8th ed. 2004)). Under the principle stated in Vasquez and discussed in Vasser, therefore, if the term "convicted" in Tenn. Code Ann. § 8-35-124(a) were used without further qualification, it would be construed as referring to the "technical meaning" of "convicted."

As stated in Vasser, however, the technical meaning is used only "absent statutory definition to the contrary." State v. Vasser, 870 S.W.2d at 546. A definition to the contrary is found in Tenn. Code Ann. § 8-35-124(b), which requires that benefits be stopped "[u]pon initial conviction, or upon a plea of guilty or nolo contendere." The juxtaposition of "initial conviction" and "a plea of guilty or nolo contendere" establishes that in enacting Tenn. Code Ann. § 8-35-124(b) the General Assembly did not intend "initial conviction" to have the full "technical sense" discussed in Vasser and Vasquez. Such a reading would create inconsistent standards for triggering the statute's application, since a sentence would be required in the case of a "conviction" but not in the case of a plea of guilty or nolo contendere. Under the plain language of Tenn. Code Ann. § 8-35-124(b), therefore, "initial conviction" must be defined in the "general sense," and retirement benefits must be stopped upon a verdict of guilty by a jury, a finding of guilt by a judge in a bench trial, or the entry of a plea of guilty or nolo contendere, subject to any further qualifications set forth in Tenn. Code Ann. § 8-35-124. See e.g., In re Estate of Davis, 308 S.W.3d 832, 839 (Tenn. 2010) (recognizing that "statutory language cannot be considered in a vacuum, but 'should be construed, if practicable, so that its component parts are consistent and reasonable'") (quoting Marsh v. Henderson, 221 Tenn. 42, 424 S.W.2d 193, 196 (1968)).

ROBERT E. COOPER, JR.
Attorney General and Reporter

WILLIAM E. YOUNG
Solicitor General

JONATHAN N. WIKE
Senior Counsel

Requested by:

Steve Curry
First Deputy Treasurer
10th Floor Andrew Jackson Building
502 Deaderick Street
Nashville, Tennessee 37243