Metcalfe v. State

Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER.
Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email
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THE SUPREME COURT OF THE STATE OF ALASKA

PETER METCALFE, Individually and on )
behalf of All Others Similarly Situated, ) Supreme Court Nos. S-15528/S-15557
)
Appellant, ) Superior Court No. 1JU-13-00733 CI
)
v. ) OPINION
)
STATE OF ALASKA, ) No. 7132 – November 4, 2016
)
Appellee. )
)

Appeal from the Superior Court of the State of Alaska, First
Judicial District, Juneau, Trevor Stephens, Judge.

Appearances: Jon Choate, Choate Law Firm LLC, Juneau,
for Appellant. Kevin T. Wakley, Assistant Attorney General,
and Michael C. Geraghty, Attorney General, Juneau, for
Appellee.

Before: Fabe, Chief Justice, Winfree and Maassen, Justices.
[Stowers and Bolger, Justices, not participating.]

WINFREE, Justice.

FABE, Chief Justice, concurring in part and dissenting in part.

I. INTRODUCTION
We previously have held that the legislature cannot diminish a state
employee’s accrued retirement benefits.1 We also previously have held that if the
legislature diminishes retirement benefits, those affected may choose between their
existing benefits and the new benefits.2 The primary issue in this case is whether a
breach of contract damages claim can arise when existing retirement benefits are
diminished. We hold there can be no such claim. The secondary issue is whether a
claim for declaratory and injunctive relief against the diminishment of existing retirement
benefits is subject to a statute of limitations defense. We hold it is not. Here the superior
court dismissed a contract damages claim and a claim for declaratory and injunctive
relief based on a statute of limitations defense. We affirm dismissal of the contract
damages claim on the alternative ground that no such claim exists; we reverse and
remand the declaratory and injunctive relief claim for further proceedings.
II. FACTS AND PROCEEDINGS
Peter Metcalfe was employed briefly by the State in the early 1970s and
contributed to the Public Employees’ Retirement System (PERS). In 1981 Metcalfe took
a refund of his PERS contributions. Under a statute in effect during Metcalfe’s
employment and when he took his PERS refund, if Metcalfe later secured State

1
Hammond v. Hoffbeck, 627 P.2d 1052, 1055-57 (Alaska 1981) (holding that
when accrued state retirement benefits are modified any adverse effects must be offset
by comparable new advantages to survive art. XII, § 7 challenge).
2
McMullen v. Bell, 128 P.3d 186, 190-91 (Alaska 2006) (“Where the state
has changed the benefits system after an employee’s enrollment in the system, the
employee may choose to accept the new system or may opt to keep the benefits in effect
at enrollment.”); see also Hammond, 627 P.2d at 1059 (holding retirement benefits
modifications constitutionally infirm, and thus inapplicable, to members electing to
receive unmodified benefits).

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employment and returned his refund to PERS with interest, he was entitled to reinstate
at his prior PERS service tier and credit.3 But in 2005 the legislature repealed that
statute, leaving a five-year grace period for regaining State employment and reinstating
to a prior PERS status.4 The State then sent notice to former PERS members that
“[d]efined benefit members who do not return to covered employment before July 1,
2010 will forfeit their defined benefit tier and all service associated with the refund.”
In 2012 Metcalfe inquired about his PERS status. He was informed that
even if he were to regain State employment, he could not reinstate to his prior PERS
service tier and credit because AS 39.35.350 had been repealed in 2005 and the grace
period for reinstatement had ended in 2010. In June 2013 Metcalfe brought a putative
class action lawsuit against the State, alleging that the 2005 legislation: (1) violated
article XII, section 7 of the Alaska Constitution;5 (2) deprived a class of former
employees of their vested interest in the contractual “benefit to be reinstated to state
employment at the tier level they previously held”;6 and (3) effectively breached the class

3
See former AS 39.35.350(b) (1980) (“An employee may reinstate credited
service associated with a refund by repaying the total amount of the refund. Interest will
accrue from the date of the refund until repayment of the refund or retirement, whichever
occurs first.”); former AS 39.35.350 (1970) (“[T]he employee is entitled to the credited
service he had accumulated at the time of his last termination, if the employee makes a
contribution to the system equal to the amount of the refund paid upon his last
termination . . . together with interest . . . .”).
4
Ch. 9, §§ 133, 149 FSSLA 2005.
5
Article XII, § 7 provides: “Membership in employee retirement systems
of the State or its political subdivisions shall constitute a contractual relationship.
Accrued benefits of these systems shall not be diminished or impaired.”
6
Cf. Hammond, 627 P.2d at 1057 (“[B]enefits under PERS are in the nature
of deferred compensation and . . . the right to such benefits vests immediately upon an
(continued...)

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members’ employment contracts. Metcalfe sought damages, but he also asked for a
seemingly mutually exclusive declaratory judgment that the State must comply with
former AS 39.35.350.7 The class was never certified.
The State moved to dismiss Metcalfe’s lawsuit for failure to state a claim
upon which relief could be granted,8 arguing that: (1) Metcalfe did not have standing to
sue because article XII, section 7 of the Alaska Constitution protects only PERS
members and Metcalfe no longer was a PERS member after he took a refund of his
contributions; (2) Metcalfe’s claim was not ripe because he had not secured
reemployment with the State and thus failed to meet former AS 39.35.350’s PERS
reinstatement requirements; and (3) the contract statute of limitations barred Metcalfe’s
claim because the legislation was passed in 2005 but Metcalfe did not sue until 2013.9
The superior court tentatively rejected the argument that Metcalfe failed to state a claim

6
(...continued)
employee’s enrollment in that system.”).
7
Cf. McMullen, 128 P.3d at 191 (“Where the state has changed the benefits
system after an employee’s enrollment in the system, the employee may choose to accept
the new system or may opt to keep the benefits in effect at enrollment.”).
8
See Alaska R. Civ P. 12(b)(6) (allowing certain dismissal motions,
including those for “failure to state a claim upon which relief can be granted,” to be made
in lieu of an answer).
9
See AS 09.10.053 (“Unless the action is commenced within three years,
a person may not bring an action upon a contract or liability, express or implied, except
as provided in AS 09.10.040, or as otherwise provided by law, or, except if the
provisions of this section are waived by contract.”).

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upon which relief could be granted, rejected the argument that Metcalfe’s claim was not
ripe and that he lacked standing, but dismissed Metcalfe’s claim as time barred.10
Metcalfe appealed the superior court’s dismissal of his claim based on the
statute of limitations. The State cross-appealed the superior court’s ruling that
Metcalfe’s claim was ripe and argued that the superior court’s decision could be upheld
on the ground that Metcalfe lacked standing to sue. After oral argument we requested
supplemental briefing primarily addressing two questions: (1) can a claim for diminution
in value of a contract right exist in this context, and (2) can a statute of limitations
defense apply to a claim for declaratory and injunctive relief prohibiting the enforcement
of a statute alleged to be in violation of article XII, section 7?
III. DISCUSSION
A. Arguments In The Superior Court
Metcalfe’s complaint contained a lengthy recitation of facts and law
asserting that the 2005 legislation violated the Alaska Constitution. But Metcalfe’s claim
primarily was that he was entitled to damages because the 2005 legislation breached his
PERS contract. A single reference to declaratory judgment was included in the ultimate
prayer for relief, essentially asking the court to order the State to honor former
AS 39.35.350.11

10
The parties agreed and the superior court concluded that the three-year
contract statute of limitations applied to Metcalfe’s claim. See supra note 9.
11
Cf. Laverty v. Alaska R.R. Corp., 13 P.3d 725, 729-30 (Alaska 2000)
(noting Alaska’s Declaratory Judgment Act (AS 22.10.020(g)) authorizes courts “to
declare rights without granting a separate legal or equitable remedy” and that it may be
appropriate “to determine the validity and construction of statutes,” but that a requested
declaration must “be associated with an actual case or controversy” and “not open the
door for hypothetical adjudications, advisory opinions, or answers to moot questions”).

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 When the State moved to dismiss Metcalfe’s claim, Metcalfe affirmatively
asserted that his “claim is for breach of contract” and that it has “significant value,”
without any reference to a separate declaratory judgment that the State must honor
former AS 39.35.350. Metcalfe argued that former AS 39.35.350’s provision for future
reinstatement at previous PERS service and tier levels was a constitutionally based
contract right that — despite his withdrawal from the PERS system — had not been
relinquished, giving him standing to sue the State for impairment of that right. He
contended that the State had breached the contract on June 30, 2010 when former
AS 39.35.350 finally was extinguished based on the earlier 2005 legislation. He
reasoned that the contract claim became ripe on July 1, 2010, and therefore that his June
27, 2013 lawsuit was within the three-year statute of limitations. Although
acknowledging that “the value of [his contract right] may seem abstract,” Metcalfe
argued that projected State savings from the statutory change, in excess of $100 million
per year for medical insurance premiums alone, “grounds the financial value firmly in
fact.”
The superior court made a “tentative” determination that Metcalfe had a
vested reinstatement right under former AS 39.35.350, but noted need for further briefing
on this issue if the case were to proceed. The court then concluded that this assumed
vested right gave Metcalfe standing to sue and that, given the allegation that the 2005
legislation breached Metcalfe’s PERS contract and diminished the assumed vested right’s
value, his claim was ripe. The court also noted that to the extent Metcalfe sought
declaratory relief, it was for the court to determine whether the State had breached his
PERS contract. But the court concluded that Metcalfe’s breach of contract claim accrued
in 2005 when former AS 39.35.350 was repealed — not at the close of the five-year
grace period — because the alleged lifetime reinstatement right had been diminished
immediately when the 2005 legislation limited it to the five-year grace period and

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Metcalfe reasonably should have discovered the ability to bring his claim then. The
court noted that Metcalfe had at least constructive notice of his claim in 2005 and had not
argued either that he did not have notice or that the statute of limitations should be tolled.
The court therefore dismissed Metcalfe’s claim as barred by the three-year statute of
limitations.
Metcalfe then filed a reconsideration motion asserting that the superior
court had overlooked a critical proposition of law. Metcalfe argued specifically that the
2005 legislation actually had not been a breach of his contract but rather was a
repudiation of that contract allowing him to sue either when he chose to assert the breach
or when the State’s performance was due. Metcalfe’s new legal theory, based on
Restatement (Second) of Contracts § 25012 and Franconia Associates v. United States,13

12
The Restatement (Second) of Contracts defines repudiation as:
(a) a statement by the obligor to the obligee indicating that
the obligor will commit a breach that would of itself give the
obligee a claim for damages for total breach . . . , or
(b) a voluntary affirmative act which renders the obligor
unable or apparently unable to perform without such a
breach.
RESTATEMENT (SECOND) OF CONTRACTS § 250 (AM. LAW INST. 1981).
13
536 U.S. 129 (2002). In Franconia property owners had received low-
interest federal loans to provide low-income rental housing, subject to various
restrictions; the promissory notes allowed prepayment and release from those
restrictions. Id. at 132-35. Concerned with low-income housing loss due to loan
prepayments, Congress amended relevant laws to prohibit acceptance of prepayment
unless the property owner agreed to maintain the low-income rental use of the property
for a specified period of time. Id. at 135-36. Nine years after the statutory amendment
and related regulations were implemented some property owners sued, arguing that
(1) the new law was a repudiation of their contracts and an inverse condemnation of their
property rights, and (2) they had the right to execute their options to prepay their loans
(continued...)

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was different from his pleaded allegations, his opposition to the State’s dismissal motion,
and his prior litigation position that the repeal of former AS 39.35.350 was a fait
accompli supporting a contract damages claim. And Metcalfe still made no reference to
declaratory judgment in connection with his new theory.
The State opposed reconsideration, responding that Metcalfe’s repudiation
argument was inconsistent with his claim that “his rights were diminished immediately
upon the enactment of SB 141.” (Emphasis in original.) It also argued that Franconia
was distinguishable and that Metcalfe’s new repudiation argument was at odds with his
position that the 2005 legislation had devalued his contract right and caused him
immediate harm.
The superior court denied Metcalfe’s reconsideration motion. The court
concluded Franconia was not controlling and was distinguishable because it did not
involve retirement system contract rights, and noted the majority federal rule that a claim
for wrongful changes to a retirement program accrues when a clear repudiation of
retirees’ rights is made known. More importantly the court did not believe that the 2005
legislation was a “mere anticipatory repudiation”:
[I]n any event, the court is not persuaded that the
passage of [the 2005 legislation] constituted a mere
anticipatory repudiation. The gist of Mr. Metcalfe’s claim is
that [the 2005 legislation] violated [a]rticle XII, § 7. Such a
violation would have occurred when [the 2005 legislation]
was enacted as [it] would have immediately diminished an

13
(...continued)
and escape the prepayment restrictions. Id. at 133, 138. The Court of Federal Claims
dismissed the suit based on a six-year statute of limitations and the Circuit Court
affirmed. Id. at 138. The Supreme Court reversed, concluding that the statutory
amendment was not an immediate breach of contract, but rather a repudiation allowing
the property owners to elect to treat the repudiation as a breach before the government’s
performance date or to await the performance date. Id. at 142-44.

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 accrued retirement benefit. Moreover, if viewed in
conventional contract terms, if Mr. Metcalfe has a state
Constitution based retirement benefit accruing at the time of
his initial State hire to repay his PERS contribution and be
reinstated to his former retirement tier if ever rehired by the
State at any time, [the 2005 legislation] breached the contract
when enacted as it immediately removed this “any time”
right. This view is consistent with Mr. Metcalfe’s own
arguments with respect to the State’s lack of ripeness and
lack of standing claims. To the extent that Franconia holds
otherwise the court does not find it persuasive. (Footnote
omitted.)
The superior court stated that its order “appears to conclude this litigation,”
and it concurrently entered a separate final judgment. Nothing in the record reflects that
Metcalfe challenged the final judgment that concluded the superior court litigation;
Metcalfe did not argue that he had any claims not yet litigated, such as a claim for a
declaratory judgment that the State must honor former AS 39.35.350.
B. Arguments On Appeal
Metcalfe initially argued in his briefing to us that two theories prevent his
contract damages claim being barred by the statute of limitations. One is that through
the 2005 legislation the State violated its contractual obligation not to diminish or impair
his reinstatement right without an equivalent offsetting benefit; this resulted in a contract
breach on June 30, 2010, the final grace period day for reinstatement under former
AS 39.35.350. The other is that the State has repudiated but not yet breached its
contractual obligation to reinstate Metcalfe upon his future reemployment and repayment
of his refunded PERS contributions — and that this repudiation allows him to sue for
damages any time before the State’s performance otherwise would be due and to seek
contract damages even though he has not been rehired by the State (or tendered
repayment of his withdrawn PERS contributions). But he nonetheless characterizes the

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damages for each contract claim in the same manner: the diminution in value of his
alleged lifetime PERS reinstatement rights under former AS 39.35.350.
The phrase “declaratory judgment” cannot be found anywhere in the
argument sections of Metcalfe’s opening and reply briefs. He did not contest the
superior court’s determination that his request for declaratory relief was only a reiteration
of his contention that his contract had been breached and he was entitled to damages.
Nor did he argue that the superior court erred by not entering a declaratory judgment that
the State must honor former AS 39.35.350.14
On the other hand the superior court expressly noted that Metcalfe was
bringing a claim for declaratory relief regarding the 2005 legislation. The court
determined that Metcalfe had standing to seek declaratory relief because he presented an
actual controversy ripe for decision — his claim was based on an asserted constitutional
interest already subject to diminishment. And in its cross-appeal the State argued that
if the superior court erred in its statute of limitations ruling, we should affirm the
dismissal of Metcalfe’s lawsuit because he did not have standing to bring a claim for
declaratory judgment and his claim was not ripe for declaratory relief. Metcalfe disputed
the State’s arguments but his response did not focus directly on its argument against
declaratory relief.
In response to our order for supplemental briefing, Metcalfe directed us to
article XII, section 7 cases in which we have either permitted a breach of contract claim
alongside a claim for declaratory and injunctive relief or applied contract-law principles
in deciding the case. Metcalfe characterized his claim for damages and declaratory and

14
Cf. Laverty, 13 P.3d at 730, 738 (noting laches-based denial of associated
equitable relief “does not necessarily mean that an accompanying claim for declaratory
relief should also be blocked” and concluding superior court had not abused its discretion
in reaching declaratory judgment claim).

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injunctive relief as seeking remedies for two separate harms: a remedy at law for one
harm, a breach of contract and resulting injury occurring while the 2005 legislation has
been in effect; and an equitable remedy for the other harm, a declaratory and injunctive
relief prohibiting future enforcement of the 2005 legislation. Metcalfe asserted that no
statute of limitations applies to his claim for declaratory and injunctive relief because
such a claim seeks to prevent a future harm. The State countered that even if Metcalfe’s
declaratory and injunctive relief claim could survive dismissal based on the statute of
limitations, the claim could not survive the State’s other defenses. Both parties also
urged us to decide the actual merits of Metcalfe’s statutory diminution claim if we
determine the claim was dismissed in error.
C. Decision
1. Metcalfe has no right to diminution of value damages based on
a claim that the 2005 legislation was a breach of the PERS
contract.
We have not previously recognized a constitutional claim for damages for
a violation of article XII, section 7.15 In Hammond v. Hoffbeck16 we interpreted article
XII, section 7 to mean that members’ retirement system rights accrue upon employment
and enrollment17 and noted our view that the protected benefit rights include
“requirements for eligibility.”18 We recognized that retirement systems require some

15
“[W]e apply our independent judgment to questions of law presented by
constitutional issues.” Majaev v. State, 223 P.3d 629, 631 (Alaska 2010) (citations
omitted).
16
627 P.2d 1052 (Alaska 1981).
17
Id. at 1055-57.
18
Id. at 1058; see also Sheffield v. Alaska Pub. Emps.’ Ass’n, 732 P.2d 1083,
1087 (Alaska 1987) (stating that constitutionally protected retirement benefits include
(continued...)

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flexibility for successful operations, holding that the constitution does not preclude
modifications to system rights after employment and enrollment, but that it does “require
that any changes in the system that operate to a given employee’s disadvantage must be
offset by comparable new advantages to that employee.”19
The merits of and remedies in Hammond are instructive. The case involved
amendments to PERS eliminating distinctions between public safety employees and other
PERS participants, effectively reducing certain occupational disability and death benefits
and increasing certain eligibility requirements for occupational pension benefits for the
public safety employees.20 A public safety employees’ union sued, alleging the PERS
changes were unconstitutional; the superior court agreed and prospectively enjoined the
changes in their entirety.21 The State argued that any benefit diminishment had been
offset by other advantages from the PERS amendments and that the changes were
constitutionally sound.22
We noted that our task on appeal was to determine whether the PERS
modifications had disadvantageous effects on the public safety employees and, if so, to
weigh those disadvantages against any advantages that may have accompanied them.23

18
(...continued)
not just dollar amounts, but “the practical effect of the whole complex of provisions”
(emphasis omitted) (quoting Opinion of the Justices, 303 N.E.2d 320, 327 (Mass. 1973)
(construing Mass. Gen. Laws ch. 32, § 25(5) (amended 1956)))).
19
Hammond, 627 P.2d at 1057.
20
Id. at 1053-54.
21
Id. at 1055.
22
See id. at 1058.
23
Id. at 1057-58.

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We concluded that the superior court correctly determined that the PERS modifications
were an effective diminishment of vested system rights and violated article XII, section 7
as to those public safety employees adversely affected.24 But we explained that the
ultimate determination whether vested rights have been diminished must be made on a
case-by-case basis.25 We specifically concluded that the superior court had erred by
prospectively invalidating the PERS modifications when there would be no constitutional
infirmity in applying them to persons employed and enrolled after their effective date.26
We also noted that persons employed before the PERS modifications’ effective date who
wished to be covered by the new system could elect to do so.27 We held that the PERS
modifications were only unconstitutional in relation to persons employed before the
modifications’ effective date who chose to receive benefits under the system in effect at
the time they were hired.28 Thus the available remedy for the modifications’
constitutional infirmity was an in-system benefits choice.29
More recently, in McMullen v. Bell we reiterated both that under the
constitution the legislature may not impair accrued state retirement system benefits and
that benefit rights vest on employment and enrollment.30 Further:

24
Id. at 1059.
25
Id. (citing Betts v. Bd. of Admin. of the Pub. Emps.’ Ret. Sys., 582 P.2d 614,
617 (Cal. 1978) (en banc)).
26
Id.
27
Id. & n.13.
28
Id. at 1059-60.
29
Id. & n.13.
30
128 P.3d 186, 190 (Alaska 2006).

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 An employee’s vested benefits arise by statute, from the
regulations implementing those statutes, and from the
division’s practices. Where the state has changed the benefits
system after an employee’s enrollment in the system, the
employee may choose to accept the new system or may opt
to keep the benefits in effect at enrollment.[31]
This suggests Metcalfe’s proper remedy is allowing him to keep the retirement benefits
available to him — whatever those benefits might be — not breach of contract damages.
Although we have used contract-law principles to decide article XII,
section 7 cases32 and have even affirmed a related breach of contract finding in a case,33
breach of contract damages are not an appropriate remedy for the alleged constitutional
violation here: In Lowell v. Hayes we declined to allow “a constitutional claim for
damages, ‘except in cases of flagrant constitutional violations where little or no
alternative remedies are available.’ ”34 We later stated that declaratory and injunctive
relief are appropriate remedies with respect to potentially unconstitutional statutes if the
circumstances of the case do not meet the exception described in Lowell v. Hayes and

31
Id. at 190-91 (footnote omitted) (citing Hammond, 627 P.2d at 1059
(explaining employee’s right to choose between benefit systems)).
32
See, e.g., State v. Allen, 625 P.2d 844, 848 (Alaska 1981) (applying contract
principle of “condition subsequent” to resolve article XII, section 7 claim).
33
Municipality of Anchorage v. Gentile, 922 P.2d 248, 260 n.13 (Alaska
1996) (“The trial court also held that by diminishing the medical benefits, MOA violated
article XII, section 7 of the Alaska Constitution. Because the class members’ [related
union] contract claim fully resolves the question of whether the medical benefits vested
when the covered employees retired, it is unnecessary to consider claimants’
constitutional claim.”).
34
117 P.3d 745, 753 (Alaska 2005) (quoting Dick Fischer Dev. No. 2, Inc. v.
State, Dep’t of Admin., 838 P.2d 263, 268 (Alaska 1992)).

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damages are unavailable.35 Our general reluctance to allow a constitutional claim for
damages where other remedies exist, viewed in concert with our past article XII,
section 7 decisions, convinces us that Metcalfe has no cognizable claim for breach of
contract damages — Metcalfe’s remedy here has been outlined in Hammond and
McMullen.
Because in his current status Metcalfe has no cognizable claim for breach
of contract damages, we affirm the dismissal of the claim without reaching whether the
claim is barred by the statute of limitations.36
2. We remand Metcalfe’s claim for declaratory and injunctive
relief for further proceedings.
a. Statute of limitations
A declaratory judgment is neither strictly legal nor strictly equitable.37
When deciding whether a time-limitation defense applies to a declaratory and injunctive
relief claim, we have noted that courts often consider the substance of the relief sought.38

35
Krause v. Matanuska-Susitna Borough, 229 P.3d 168, 175 (Alaska 2010)
(reversing the dismissal of a claim for declaratory and injunctive relief, noting that the
plaintiffs “are not entitled to money damages for the alleged violations of their
constitutional rights, but they may seek declaratory and injunctive relief”).
36
“We may affirm a judgment on any grounds that the record supports, even
if not relied on by the superior court.” Snyder v. Am. Legion Spenard Post No. 28, 119
P.3d 996, 1001 (Alaska 2005).
37
See Laverty v. Alaska R.R. Corp., 13 P.3d 725, 730 (Alaska 2000) (“We
have similarly described the Declaratory Judgment Act as adding ‘another remedy to
existing legal and equitable remedies.’ ” (quoting Jefferson v. Asplund, 458 P.2d 995,
997 (Alaska 1969))).
38
See id. (“Courts often resolve this problem [of declaratory judgments
arising either at law or equity] by looking to the circumstances surrounding the claim and
applying laches if the claim would have arisen in equity before declaratory judgment was
(continued...)

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We have held that equitable relief claims are not subject to statutes of limitations and are
instead controlled by the doctrine of laches.39 Aside from declaratory judgment,
Metcalfe may seek only equitable relief here because, as explained above, he currently
has no cognizable claim for a remedy at law.
In State v. Alex we considered whether time-limiting defenses applied to a
suit challenging a statute’s constitutionality and seeking damages, declaratory judgment,
and an injunction.40 We determined that the damages claim was governed by a statute
of limitations because it was an action at law, and we found no error in the trial court’s
determination that the laches doctrine did not apply to the request for declaratory relief
and an injunction because laches is inapplicable when relief is “prospective in
application and seek[s] to prevent future threatened harm.”41 Metcalfe’s claim similarly
is prospective in nature and seeks to challenge future enforcement of a statute as
constitutionally infirm. Laches — not a statute of limitations — is the appropriate time-
limiting defense here, but, as in Alex, it is inapplicable to Metcalfe’s claim.
It was error to dismiss Metcalfe’s declaratory and injunctive relief claim as
barred by AS 09.10.053.

38
(...continued)
available.”).
39
Moffitt v. Moffitt, 341 P.3d 1102, 1105 (Alaska 2014) (reversing a summary
judgment order concerning equitable claims because the order applied a statute of
limitations to bar the claims).
40
646 P.2d 203, 215 (Alaska 1982).
41
Id. (stating that it was “simply inappropriate” to apply laches analysis to a
declaratory judgment and injunctive relief claim challenging statute’s constitutionality
because relief sought was “prospective in application”).

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 b. Ripeness
The superior court determined that Metcalfe’s claim was ripe because he
alleged an injury caused by the 2005 legislation. The State challenges the superior
court’s determination, asserting that Metcalfe must regain a PERS-benefitted position
before his claim will be ripe for decision.
“The ripeness doctrine requires a plaintiff to claim that either [an] . . . injury
has been suffered or that one will be suffered in the future.”42 There is “no set formula”
to identify whether a case is ripe for decision.43 When considering a claim for
declaratory relief regarding a statute’s constitutionality, courts should “balance . . . the
plaintiffs’ ‘need for decision against the risks of decision.’ ”44 The “need for decision”
is judged as “a function of the probability that [the plaintiff] will suffer an anticipated
injury.”45 The “risks of decision” are measured “by the difficulty and sensitivity of the
issues presented, and by the need for further factual development to aid decision.”46
Here Metcalfe seeks a declaratory judgment identifying the 2005
legislation’s effect on his asserted PERS rights. Although we have rejected his claim of
monetary injury, Metcalfe nonetheless has raised a claim that his asserted PERS rights
have been wrongfully diminished, and he has demonstrated a need for decision: As the

42
Brause v. State, Dep’t of Health & Soc. Servs., 21 P.3d 357, 359 (Alaska
2001) (citing Bowers Office Prods., Inc. v. Univ. of Alaska, 755 P.2d 1095, 1099 (Alaska
1988)).
43
Id. at 359.
44
Id. at 360 (quoting 13A CHARLES ALAN WRIGHT ET AL.,FEDERAL PRACTICE
AND PROCEDURE § 3532.1, at 115 (2d ed. 1984)).

45
Id.
46
Id. (citing WRIGHT, supra note 43, § 3532.1, at 115).

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superior court recognized, Metcalfe and others in his position need to know their PERS
status to make decisions about pursuing employment opportunities with the State. And,
as explained above, substantial case law guides a court deciding an article XII, section 7
claim, rendering the risk of decision low. The superior court did not abuse its discretion
in determining that Metcalfe’s declaratory judgment claim was ripe for decision.47
c. Other issues
The superior court “tentatively” determined that Metcalfe had a vested
PERS right under former AS 39.35.350 before moving on to the ripeness and statute of
limitations issues. The court noted that it would need further briefing before deciding
whether Metcalfe actually had a vested PERS interest in light of his complete departure
from the retirement system in the 1980s. Both parties ask us to decide this question, as
well as other issues that go to the merits of Metcalfe’s claim that the 2005 legislation
unconstitutionally diminished PERS rights. We decline the invitation because —
without need for further specificity — we are divided on the fundamental question.
Although Metcalfe brought this case as a class action, the motion to dismiss
preceded serious class certification efforts. Here a divided decision affirming the
superior court’s dismissal of Metcalfe’s case on the alternative basis that Metcalfe has
no vested PERS right to assert in this context — as the dissenting opinion urges —
would resolve the issue for Metcalfe but not for anyone else in the putative class, and
could lead to inconsistent results.48 On the other hand, reaching out to render a divided

47
We review a superior court’s decision regarding a controversy’s ripeness
for abuse of discretion. Id. at 358-59.
48
See Alaska R. App. P. 106(b) (“In an appeal that is decided with only three
of five supreme court justices participating, any issue or point on appeal that the court
decides by a two-to-one vote is decided only for purposes of that appeal, and shall not
have precedential effect.”).

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decision that Metcalfe has a vested PERS right to assert in this context would not only
resolve the issue in Metcalfe’s favor, but also ultimately could lead to resolving the issue
in the putative class’s favor on remand. This seems imprudent and unfair to the State.
We deem it best to allow the superior court the opportunity to resolve both the class
action issues and the remaining declaratory judgment issues in the first instance.
IV. CONCLUSION
We AFFIRM the dismissal of Metcalfe’s monetary damages claim and
REMAND for further proceedings on his declaratory judgment and injunctive relief
claim.

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FABE, Chief Justice, concurring in part and dissenting in part.
Although I agree with the court’s decision affirming on alternative grounds
the superior court’s dismissal of Metcalfe’s claim for money damages, I respectfully
disagree with the decision to remand this case to the superior court for further
proceedings. In my view, the superior court’s dismissal of this case in its entirety should
be affirmed because article XII, section 7 of the Alaska Constitution does not encompass
Metcalfe’s claim. Metcalfe is not a member of PERS within the meaning of the PERS
statutes, so the constitutional prohibition on impairing or diminishing membership
benefits does not apply to him. The statutory change therefore falls outside the scope of
Metcalfe’s article XII, section 7 protections, and Metcalfe has stated no claim for relief
under that provision. Because we may affirm the superior court on any grounds briefed
by the parties and supported by the record,1 I would affirm the superior court’s decision
to dismiss Metcalfe’s claim on these alternate grounds.
By its plain terms, article XII, section 7 applies only to members of
employee retirement systems: It first provides that “[m]embership in employee
retirement systems of the State or its political subdivisions shall constitute a contractual
relationship” before going on to explain that “[a]ccrued benefits of these systems shall
not be diminished or impaired.”2 Because the provision only governs “[m]embership in
employee retirement systems,” the anti-diminishment provision protects only members
of such systems.
The definition of PERS membership is governed by AS 39.35.680, which
provides that the term “member” refers to “a person eligible to participate in the plan and

1
See Snyder v. Am. Legion Spenard Post No. 28, 119 P.3d 996, 1001 (Alaska
2005) (first citing Marshall v. First Nat’l Bank of Alaska, 97 P.3d 830, 835 (Alaska
2004); then citing Ransom v. Haner, 362 P.2d 282, 285 (Alaska 1961)).
2
Alaska Const. art. XII, § 7 (emphasis added).

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who is covered by the plan,” including active members as well as various categories of
inactive, vested, or retired members.3 On the other hand, the statute defines a “former
member” as “an employee who is terminated and who has [requested or] received a total
refund of the balance of the employee contribution account.”4 It also specifically
provides that the term “ ‘member’ . . . does not include former members.”5 A nearly
identical version of this statute was in effect when Metcalfe received a refund of his
retirement contributions in 1981, similarly providing that the term “ ‘member’ . . . does
not include former members,” and that the term “former member” encompasses
employees who have “received a total refund” of their employee contribution accounts.6
When a statute is clear and unambiguous, we have explained that it “will
not be modified or extended by judicial construction.”7 Here, the language of
AS 39.35.680 is unequivocal. And as the State correctly notes, all of our past decisions
on diminishment of benefits under PERS or other public employee retirement systems
have addressed the benefits of members.8 We have never held that article XII, section 7

3
AS 39.35.680(22)(A)-(B).
4
AS 39.35.680(20).
5
AS 39.35.680(22)(C)(i).
6
Former AS 39.35.680(19), (21) (1981); see ch. 128, § 54, SLA 1977.
7
State v. Pub. Safety Emps. Ass’n, 93 P.3d 409, 415 (Alaska 2004) (quoting
Tesoro Petroleum Corp. v. State, 42 P.3d 531, 537 (Alaska 2002)).
8
See Alford v. State, Dep’t of Admin., Div. of Ret. & Benefits, 195 P.3d 118
(Alaska 2008) (regarding the State’s recapture of early retirement benefits after members
retired, retained PERS membership, and then re-entered public employment); Bd. of Trs.,
Anchorage Police & Fire Ret. Sys. v. Municipality of Anchorage, 144 P.3d 439 (Alaska
2006) (regarding “surplus benefits” for current members of the municipality’s retirement
system); McMullen v. Bell, 128 P.3d 186 (Alaska 2006) (reviewing the calculation of a
(continued...)

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applies to non-members of PERS, and such a decision would contradict the clear text of
AS 39.35.680 and of article XII, section 7 itself. Thus, the statutory text and our existing
precedent both demonstrate that the anti-diminishment provision of article XII, section 7
does not apply to former members of PERS.
Because former members are not members of PERS within the meaning of
AS 39.35.680 and the constitutional anti-diminishment provision, Metcalfe is not a
member of PERS and was not a member when the disputed statute was repealed.
Metcalfe chose to relinquish his membership status by taking a full refund of his PERS
contributions in 1981. Using either the definition in effect at that time9 or the definition
in effect in 2005,10 Metcalfe’s decision to “receive[] a total refund” of his PERS account
meant that he became a former member within the meaning of the PERS statutes. And
once he had become a former member, Metcalfe could no longer claim entitlement to any

8
(...continued)
specific PERS member’s benefits); Duncan v. Retired Pub. Emps. of Alaska, Inc., 71
P.3d 882 (Alaska 2003) (regarding PERS and TRS members’ health insurance benefits);
Municipality of Anchorage v. Gallion, 944 P.2d 436 (Alaska 1997) (reviewing a change
to the “accrued benefits” of some members of a municipal retirement plan); Municipality
of Anchorage v. Gentile, 922 P.2d 248, 260 n.13 (Alaska 1996) (declining to consider
the constitutional claim brought by members of a municipal retirement plan); Sheffield
v. Alaska Pub. Emps.’ Ass’n, 732 P.2d 1083 (Alaska 1987) (regarding a change in
calculating PERS members’ accrued benefits); State ex rel. Hammond v. Allen, 625 P.2d
844 (Alaska 1981) (reviewing the repeal of benefits for members of the Elected Public
Officers’ Retirement System); Hammond v. Hoffbeck, 627 P.2d 1052 (Alaska 1981)
(reviewing a change in benefits as applied to PERS members who were adversely
affected and employed on the date of the change).
9
Former AS 39.35.680(19) (1981).
10
AS 39.35.680(20).

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of the benefits of PERS membership.11 Metcalfe’s right to PERS benefits thus divested
at the time of his refund in 1981. So by the time the disputed change occurred in 2005,
Metcalfe had not been a PERS member for roughly 24 years, and he therefore possessed
no membership benefits that could have been unconstitutionally diminished by the repeal
of AS 39.35.350.
In sum, because he was not a member at the time of the change, and
because article XII, section 7 of the Alaska Constitution protects only the benefits of
members against diminishment or impairment, Metcalfe has no claim for relief under this
provision. The parties have had an opportunity to brief this issue, and “[w]e may affirm
a judgment on any grounds that the record supports, even if not relied on by the superior
court.”12 Here the record adequately supports the conclusion that Metcalfe’s claim does
not fall within article XII, section 7, because he is not a member of PERS. Accordingly,
it is unnecessary to remand this case for any further factual development. Instead, I
would affirm the superior court’s dismissal of the case on the ground that Metcalfe has
stated no claim for relief under article XII, section 7 of the Alaska Constitution.

11
See AS 39.35.680(22)(C)(i).
12
Snyder v. Am. Legion Spenard Post No. 28, 119 P.3d 996, 1001 (Alaska
2005) (first citing Marshall v. First Nat’l Bank of Alaska, 97 P.3d 830, 835 (Alaska
2004); then citing Ransom v. Haner, 362 P.2d 282, 285 (Alaska 1961)).

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