“The Unmistakability Doctrine Does Not Apply... [Illinois Senate Bill 1, Public Act 98-0599] Is Inseverable”

“...The defendants' reliance on the ‘unmistakability doctrine’ (Def. Br. at 44-45) fails for many of the same reasons as their reserved powers argument. A corollary to the reserved powers doctrine, the unmistakability doctrine is a canon of construction which provides that a contract will not be interpreted to surrender sovereign power unless it does so in unmistakable terms. See Winstar Corp., 518 U.S. at 871-72.

“First, just like the reserved powers doctrine, the unmistakability doctrine applies to the interpretation of contracts, not constitutions. See id. The defendants cite no case in which the unmistakability doctrine has been used to interpret a constitutional provision.

“Second, as discussed above, the Pension Protection Clause imposes only a financial obligation. It does not surrender the State's sovereign powers. Accordingly, the unmistakability doctrine has no application here. Ahmad, 2014 IL App (1st) 123629, 111(85-86 (unmistakability doctrine has no application where contract did not surrender police powers). 

“Third, to the extent the defendants argue that the Pension Protection Clause surrenders a ‘police power’ to reduce pension benefits, the language of the Pension Protection Clause (‘shall not be diminished or impaired’) is ‘plain’ (see Kanerva, 2014 IL I 15811, 41) and unmistakable.

“Finally, the ‘unmistakability doctrine does not allow governments to undertake actions that are specifically aimed at voiding a contract or preventing performance of a contract.’ United States ex rel. Anti-Discrimination Ctr. of Metro N.Y., Inc. v. Westchester Cnty., N.Y., 712 F.3d 761, 773 (2d Cir. 2013) (emphasis in original). Since the entire point of the Act is to diminish pension benefits, the unmistakability doctrine cannot be used to justify it.

“THE ACT IS INSEVERABLE: The Act's overriding purpose was the diminishment of pension benefits. The provisions effecting that unconstitutional goal are inextricably linked with all of the Act's remaining terms. Accordingly, the Act is inseverable and void in its entirety.

“The defendants' contention that the presence of a severability clause in the Act renders the Act severable (see Def. Br. at 48) rings hollow. Indeed, in the circuit court, the defendants relegated their severability argument to a footnote, and did not even bother to identify purportedly severable provisions. (R. C2225 n.7.)

“This Court has repeatedly refused to sever unconstitutional provisions from other provisions in the same legislation notwithstanding the presence of a severability clause. See Cincinnati Ins. Co. v. Chapman, 181 III. 2d 65, 81-86 (1998); see also Best, 179 III. 2d at 459-67. A severability clause is ‘not conclusive’ of the issue of severability. Best, 179 III. 2d at 460. In fact, ‘[b]ecause of the very frequency with which it is used, the severability clause is regarded as little more than a mere formality.’ Id. at 461 (quoting 2 N. Singer, Sutherland on Statutory Construction §44.08, at 521 (5th ed. 1993)).

“Notwithstanding the presence of a severability clause, an act is inseverable where it constituted a broad legislative package intended to impose sweeping changes in a subject area, and where the unconstitutional provisions of that package were important elements of it. Best, 179 III. 2d at 464-67 (legislation was ‘intended to effectuate comprehensive reform of the current tort system in Illinois,’ and the unconstitutional provisions were ‘core provisions’ that provided the ‘measures by which’ the legislation's goals would be achieved); Chapman, 181 Ill. 2d at 82-86 (legislation was intended ‘to provide a total redistricting package,’ and that goal could not be achieved without the unconstitutional provisions) (emphasis in original).

“That is precisely the situation here. Both the Act and its legislative history make abundantly clear that the overriding purpose of the Act was to diminish pension benefits. As Senator Raoul commented, the Act's provisions were needed to ‘finally break the political stalemate.’ See 98th III. Gen. Assembly, Senate Proceedings, Dec. 3, 2013, at 3 (SA 39).

“‘Some provisions were sought by House Democrats, some were sought by House Republicans, some sought by Senate Republicans, and some sought by the Senate Democrats.’ Id., at 4 (SA 40). ‘All told, the provisions in this bill are all part of an integral bipartisan package,’ Senator Raoul explained. Id.; see also, e.g., id., at 19 (SA 44) (the Act's restrictions on collective bargaining, entitled ‘Duty to bargain regarding pension amendments,’ were intended to ensure that ‘the things achieved by this bill cannot be undone by way of collective bargaining’).

“The entire purpose of that legislative package was to save the State money by diminishing pension benefits, particularly by diminishing the automatic annual increases codified in the Pension Code. See Public Act 98-0599, §1 (SA 63-65) (legislative statement); see also 98th Ill. Gen. Assembly, House Proceedings, Dec. 3, 2013, at 7 (SA 61) (remarks of Speaker Madigan) (stating that ‘the 3 percent compounded’ AAI has ‘been identified as the chief cause of the financial problem’ addressed by the Act).

“The AAI diminishment provisions were so important to the Act's operation, in fact, that the ‘severability and inseverability’ clause deems them inseverable from pension funding provisions. See, e.g., Public Act 98-0599, §97 (SA 388-89) (amendments to Pension Code reducing AAI and requiring AAI skips, sections 2-1 19.1(a-1) and (a-2), 14-114, 15­136(d-1) and (d-2), and 16-133.1, are inseverable from funding ‘guarantee’ amendments to Pension Code, sections 2-125, 14-132, 15-156 and 16-158.2).

“The unconstitutional pension diminishments thus are inseparable from the Act's other provisions, and clearly the other provisions would not have been enacted without them. Best, 179 Ill. 2d at 460 (legislation is inseverable where valid and invalid provisions are mutually connected with and dependent on each other such as to warrant the belief that the legislature intended them as a whole).

“Moreover, attempting to salvage valid pieces of this puzzle would be an exercise in futility, particularly since the defendants likewise concede that all of the Act's provisions ‘advance substantially the same basic objective.’ (Def. Br. at 48.) The Act's severability provision states that the Act's changes to 39 distinct sections and subsections of various statutes ‘are mutually dependent and inseverable from one another,’ but that those 39 provisions are ‘severable from any other provision of this Act,’ which is generally severable. See Public Act 98-0599, §97 (SA 388-89).

“That list of 39 inseverable provisions includes some, but not all, of the provisions that unconstitutionally diminish pension benefits and have been challenged in this litigation. In fact, the defendants expressly concede that ‘some provisions outside the inseverability clause would fall if this Court affirms the circuit court's decision because the State's only defense of them relies on the State's police powers.’ (Def. Br. at 49 n.6.) In other words, if this Court agrees with the circuit court that the police powers defense is invalid, more than 39 of the Act's provisions must be invalidated.

“Simply put, once pension diminishments and pension funding provisions have been invalidated, whatever remains bears no resemblance to the Act that the General Assembly actually enacted, and the entire Act is therefore void. Best, 179 Ill. 2d at 462 (‘[T]he entire act will be declared void if, after striking the invalid provisions, the act that remains does not reflect the legislative purpose in enacting the legislation’).

“‘Any attempt by this court to retain only bits and pieces of this dramatic legislation would do violence to the legislative intent,’ Chapman, 181 Ill. 2d at 85, and would, in effect, create ‘another piece of legislation that the legislature cannot be presumed to have intended to enact,’ Best, 179 Ill. 2d at 467.

“Under these circumstances, ‘[t]he new law would be created by this court and not by the General Assembly, because it enacted a different one.’ Id. (quoting Commercial Nall. Bank of Chicago v. City of Chicago, 89 Ill. 2d 45, 75 (1982)). That would be contrary to the Constitution and to numerous decisions of this Court. Id. The circuit court was therefore correct to find the Act inseverable. 

“...The Pension Protection Clause protects public servants in Illinois against diminishment or impairment of their constitutionally-promised pension benefits. The Clause was intended, above all, to insulate public pensions from the danger that government employers would claim that funding shortfalls or other fiscal exigencies required benefit diminishments or impairments, as the defendants do here. Public Act 98-0599 violates both the letter and the purpose of the Clause. Accordingly, for all of the reasons stated above, the plaintiffs respectfully request that this Court affirm the judgment of the circuit court in its entirety.”

from Brief of ISEA RSEA Heaton and Harrison Plaintiffs-Appellees