Any action to terminate a disability retirement allowance then being received by a NYC police officer must be approved by the NYC Police Pension Fund's Board of Trustees
2015 NY Slip Op 02011, Appellate Division, First Department
A former New York City Police Department police officer on disability retirement [DR] was discovered performing construction work while claiming to be disabled. as the result of a lengthy NYPD investigation, including videotaped observations showing DR performing construction work on a daily basis without apparent difficulty.
Based on the NYPD reports, the Police Pension Fund's Board of Trustees remanded DR's disability application to the Medical Board for reconsideration. The Medical Board concluded that DR's condition had improved dramatically, and recommended disapproval of his disability application and the Board of Trustees voted to place DR on a list of candidates eligible to become police officers.*
Subsequently DR became medically disqualified for the position after he tested positive for cocaine.and the City's Law Department advised the Police Pension Fund that DR was no longer disabled and was no longer eligible for reinstatement to the position of police officer. The Fund's Board of Trustees, however, did not act on this information and the Fund's Director of Pension Payroll simply informed DR that his disability pension benefit would be suspended.
DR filed an Article 78 petition to annul the Director's suspension of DR’s accidental disability retirement [ADR] benefits, contending that the suspension of his disability was arbitrary and capricious. In the alternative, DR sought his reinstatement as a police officer. Supreme Court dismissed the petition in its entirety, finding that "the determination of the Medical Board that [DR] was no longer disabled was supported by ample evidence derived from physical examinations and contained in the medical records reviewed."
The Appellate Division explained that like Supreme Court, "[it] reject[ed] [DR's] challenge to the Medical Board's determination that [DR] is no longer disabled, since that determination is supported by ’some credible evidence’ and ‘was not arbitrary and capricious."
However, it reversed the Supreme Court’s dismissal of DR’s petition, finding that the "suspension" or revocation of DR's disability benefits by the Police Pension Fund was without statutory authority, because “it was not directed by the Board of Trustees," finding that "[t]he last determination issued by the Board in this matter was that[DR] was not disabled and should be returned to work as a police officer" took place prior to DR’s testing positive for cocaine, which made him ineligible to return to duty.
The City appealed the Appellate Divisions ruling that any action to terminate a disability retirement allowance then being received by a NYC police officer must be approved by the NYC Police Pension Fund's Board of Trustees to the Court of Appeals, which rejected the City’s argument that because DRr was no longer entitled to ADR benefits, ceasing to pay the benefits was a "purely ministerial act" and affirmed the Appellate Division’s order annulling the termination of DR's pension benefits**.
The Court of Appeals said that the "Appellate Division correctly held that the ADR benefits can be terminated only by the trustees of the Police Pension Fund, who have not taken the necessary action," explaining, in pertinent part:
However well justified a reduction or termination of benefits may be in this case, the Board of Trustees has to do it. There might be cases in which the impropriety of paying benefits is so obvious that Pension Fund employees can simply stop paying, without either advance approval or ratification from the board; this might be true, for example, if the statute said on its face, "No benefits shall be paid to any beneficiary who has a positive drug test." But the application of the confusing safeguards statute to this case is something the trustees must address. Of course the trustees should weigh the advice of the City's Law Department in deciding the question, but the decision is theirs, subject to appropriate judicial review.
On remand to the Board of Trustees the City moved to terminate DR's ADR benefits retroactively to July 2007, when his ADR benefit was suspended by the Police Pension Fund.
There was a tie vote (6 in favor of termination of benefits and 6 against termination of benefits. The City took the position that the tie vote meant that the benefits had not been reinstated by the Board of Trustees and DR commenced another action seeking to compel the City to retroactively restore his ADR benefits.
Supreme Court denied the petition to the extent DR sought reinstatement of the ADR benefits but granted the petition to the extent DR sought reinstatement to the position of police officer. Both DR and the City appealed.
The Appellate Division said it agreed with the City that Supreme Court erred in granting that part of DR's petition seeking his reinstatement to the position of police officer as Supreme Court’s direction to reinstate DR to his position of police officer was inconsistent with Administrative Code §13-254, in that DR rendered himself unqualified by reason of a positive drug test for cocaine, a fact not known to the Trustees at the time they directed that petitioner's name be placed on the civil service list of persons eligible to be a police officer.
In contrast, the Appellate Division rejected the City's contention that the Police Pension Fund's July 2007 termination of DR's ADR benefits remains in effect until a majority of the Board of Trustees votes to reinstate his ADR benefits. Such position said the court is contrary to its prior decision and order that explicitly "restore[d] said benefits" and noted that the Court of Appeals affirmed that determination.
While the Appellate Division said that “like the Court of Appeals,” it found this case "very troubling" because DR's pension benefits should have been reduced or terminated once he tested positive for cocaine, the statute makes clear that any action under the statute must be taken by the Board of Trustees.
The bottom line: As DR forfeited his right to be placed on the "preference list" for appointment to the position of police officer when he disqualified himself by testing positive for cocaine, the Board of Trustees must now make a determination with respect to DR's entitlement to ADR benefits.
Here said the court, the Board has two options under the law:
1. Terminate DR’s ADR benefits; or
2. Reduce DR’s ADR benefits.
Absent Board action, DR is to receive ADR benefits retroactive to July 18, 2007, the date of the improper termination of benefits by the Police Pension Fund.The Appellate Division then remanded the matter to the Board of Trustees “for immediate action consistent with this decision and order.”
* New York City's Administrative Code (see §§ 13-202[a], [b]; 13-216[a], [b]; 13-254), provides that a disability pensioner found able to work could be required to return to City service.
** See 16 NY3d 561.
The Decision is posted on the Internet at:
Disability Benefits for fire, police and other public sector personnel - a 1098 page e-book focusing on administering General Municipal Law Sections 207-a/207-c and similar statutes providing benefits thereunder. For more information click on http://booklocker.com/books/3916.html