Court finds Pension Board's failure discontinue the payment of disability retirement benefits obviates the “suspension” of the retiree’s benefits

Court finds Pension Board's failure discontinue the payment of disability retirement benefits obviates the “suspension” of the retiree’s benefits
Matter of Seiferheld v Kelly, 2011 NY Slip Op 03309, Court of Appeals

New York City police officer James J. Seiferheld retired for alleged disability in 2004 and was awarded accident disability benefits. Seiferheld had applied for disability retirement benefits claiming that he suffered from constant pain in his right shoulder and neck, loss of range of motion in his neck and shoulder, and pain radiating into his arm as the result of a line-of-duty accident. This injury, he contended, prevented him from performing police duty. His application was granted, and he was awarded accident disability retirement on May 12, 2004.

Subsequently the police department received information that Seiferheld was working. It instituted an investigation that ultimately reported that Seiferheld was "performing construction work on a daily basis," which work included “picking up siding, passing it to others, lifting it over his head and nailing materials above his head with both arms extended for some time — all tasks performed without apparent difficulty.” A number of these activities were recorded on videotape.

The police department notified the Police Pension Fund that Seiferheld "may no longer be disabled" and the Pension Fund subsequently reexamined him. During his interview with the Pension Fund’s Medical Board Seiferheld said that he "cannot lift any heavy objects . . . cannot work overhead . . . has no outside work and his major occupation is babysitting his two children."

The Pension Fund's Medical Board concluded that Seiferheld’s condition "has improved dramatically," and recommended disapproval of his retirement application. Ultimately the Pension Fund board of trustees voted, over the dissent of several trustees, to invoke New York City Administrative Code §13-254** entitled "Safeguards on disability retirement," under which a disability pensioner found to be able to work may be returned to city service. Seiferheld was placed on a list of candidates eligible to become police officers, but subsequently he was informed that he was "medically disqualified" for that position "due to the presence of an unauthorized substance, cocaine, in your hair sample."* 

When the Pension Fund's Director of Pension Payroll advised Seiferheld "that your pension benefit will be suspended beginning with the July 2007 payroll," Seiferheld filed an Article 78 petition seeking to annul the determination to suspend his pension benefits.

Supreme Court denied the application; the Appellate Division reversed, annulling the suspension of benefits; the Court of Appeals “reluctantly” affirmed the Appellate Division’s ruling.

Characterizing New York City Administrative Code §13-254 as “complicated,” the Court of Appeals explained, in a “simplified summary,” that a “disability pensioner found to be able to work is put on a civil service list, and his or her pension is reduced based on outside earnings and the amount ‘earned . . . or earnable’ in any City job that is offered.”

Noting that the application of the statute to this case presents something of a puzzle, because although Seiferheld was put on a civil service list, he was not, and evidently could not be, offered a job because of his cocaine us, the court commented that “if the statute is mechanically applied, [Seiferheld] might actually benefit from using cocaine, because he presumably does not want to be offered a City job; he wants to remain retired and receive his pension.

Supreme Court, in a thoughtful opinion, correctly concluded that this anomaly could not have been intended by the statute's authors.

The Appellate Division, however, reversed Supreme Court's order, without discussing Supreme Court's analysis of the statute, because the suspension of Seiferheld's benefits "was not directed by the Board of Trustees" of the Pension Fund.

The Court of Appeals concluded that the Appellate Division was correct as it is “clear from a reading of the safeguards statute that action under that statute must be taken by the board.” The court explained that  “However well justified a reduction or termination of benefits may be … the board of trustees has to do it.”

The majority*** of the Court of Appeals, at the conclusion of its opinion, wrote:

“Though [Seiferheld] is entitled to prevail here, the case as a whole is very troubling. It seems from the record that [Seiferheld] either has received or is in a position to claim accident disability benefits for the last seven years, and counting. Yet any reader of this record must have serious doubt that he was ever really disabled. Whether any of the benefits paid to him may be recouped is a subject on which we express no opinion. But we do express the hope that the Pension Fund's board of trustees will generally act to protect the Fund and the public with more efficiency than it has displayed in this case.”

The decision is posted on the Internet at: 
http://www.courts.state.ny.us/reporter/3dseries/2011/2011_03309.htm 

* General Municipal Law §207-a5 provides “The appropriate municipal or fire district officials may transfer such a fireman to a position in the same or another agency or department where they are able to do so pursuant to applicable civil service requirements and provided the fireman shall consent thereto.” while General Municipal Law §207-c4 provides “The appropriate municipal officials may transfer such a policeman to a position in another agency or department where they are able to do so pursuant to applicable civil service requirements and provided the policeman shall consent thereto.” 

** The "safeguards" statute, New York City Administrative Code § 13-254, under which the Pension Fund tried to bring Seiferheld back to work, provides, in relevant part: "Once each year the board [of trustees of the Police Pension Fund] may . . . require any disability pensioner, under the minimum age or period for service retirement elected by him or her, to undergo medical examination. . . . Upon the completion of such examination the medical board shall report and certify to the board whether such beneficiary is or is not totally or partially incapacitated physically or mentally and whether he or she is or is not engaged in or able to engage in a gainful occupation. If the board concurs in a report by the medical board that such beneficiary is able to engage in a gainful occupation, he or she [sic] shall certify the name of such beneficiary to the appropriate civil service commission . . . and such commission shall place his or her name as a preferred eligible on such appropriate lists of candidates as are prepared for appointment to positions for which he or she is stated to be qualified. Should such beneficiary be engaged in a gainful occupation, or should he or she be offered city-service as a result of the placing of his or her name on a civil service list, such board shall reduce the amount of his or her disability pension . . . if any, to an amount which, when added to that then earned by him or her, or earnable by him or her in city-service so offered him or her, shall not exceed the current maximum salary for the title next higher than that held by him or her when he or she was retired." 

*** Justice Pigott, in his dissent, said: “In my view, the Appellate Division erred in finding that the Board of Trustees had not considered what action should be taken with respect to revocation of the Accident Disability Retirement benefits. This error, which the majority of this Court repeats, rests on an assumption that the Board's final determination had merely been that Seiferheld should be returned to work as a police officer. This leaves out a crucial part of the Board's ruling. The Board's final determination was that Seiferheld was not disabled, should not receive disability benefits, and should be returned to work” and would “reverse, deny the petition and dismiss the article 78 proceeding.” 
  

Statute of limitations for judicial review of a final administrative decision neither tolled nor extended by filing a request for reconsiderationll the statute of limitations for filing a timely judicial challenge to the determination

Statute of limitations for judicial review of a final administrative decision neither tolled nor extended by filing a request for reconsideration

Matter of Chapman v New York State Teachers' Retirement Sys., 2011 NY Slip Op 02994, Appellate Division, Third Department

Cheryl Hogg-Chapman, a former school counselor, applied for disability retirement benefits after falling on the stairs at work.

Following a review of Hogg-Chapman's medical records, the New York State Teachers’ Retirement System’s Medical Board concluded that there was no basis upon which to grant her request for disability retirement benefits. Hogg-Chapman was advised of the Medical Board’s determination and ultimately TRS informed petitioner it would be recommending such to respondent. Thereafter, NYSTRS notified Hogg-Chapman that it accepted the Medical Board's recommendation, and her application for disability retirement benefits was denied.

Hogg-Chapman filed an Article 78 petition challenging NYSTRS’ August 2008 determination. Supreme Court dismissed her petition, finding that the challenge was barred by the applicable four-month statute of limitations.

The Appellate Division affirmed the lower court’s ruling.

The court pointed out that §217(1) of the Civil Practice Law and Rules requires that "a proceeding against a body or officer must be commenced within four months after the determination to be reviewed becomes final and binding upon the petitioner."

Explaining that "an administrative determination becomes final and binding when it definitively impacts and aggrieves the party seeking judicial review," the Appellate Division said that there is no dispute that NYSTRS notified Hogg-Chapman in August 2008 that her application for disability retirement benefits was denied. Although Hogg-Chapman sent the Medical Board additional medical evidence and requested that it reconsider its recommendation, this did not serve to toll the statute of limitations period or make NYSTRS’ determination any less final.

Thus, said the court, as Hogg-Chapman’s Article 78 petition was filed more than four months after NYSTRS rendered its determination, Supreme Court properly dismissed the petition as time barred.

The decision is posted on the Internet at:

http://www.courts.state.ny.us/reporter/3dseries/2011/2011_02994.htm

Proof of filing a timely application for disability benefits critical

Proof of filing a timely application for disability benefits critical

Jarek v McCall, 268 A.D.2d 654

It may prove critical to have proof that an application was filed with an agency as the Jarek case demonstrates.

John Jarek, a school custodian suffered a heart attack on January 31, 1993. Unable to work, Jarek resigned from his position on March 4, 1993.

Jarek filed an application for ordinary disability retirement with the New York State Employees’ Retirement System [ERS] within 90 days of his last day of service.

The application form was notarized and sent by first class mail to ERS. Not having heard from ERS, some six months later Jarek asked ERS to advise him of the status of his application. ERS told him that it never received his application form.

Ultimately, ERS denied Jarek ordinary disability retirement benefits because he had not filed a timely application form for benefits.*

Although an ERS hearing officer recommended that Jarek’s application be accepted since he had mailed it in a timely manner and through no fault of his own it had not be received by ERS, the Comptroller sustained ERS’s initial decision denying Jarek benefits. Jarek appealed.

Did the fact that Jarek mailed his application in a timely manner qualify him for benefits? The Appellate Division said because Jarek could not prove he had filed his application within 90 days of his last day of service, the Comptroller’s determination must be sustained.

The court pointed out that in other situations it had held that simply mailing an application for benefits does not constitute filing of the required application form. According to the ruling, filing for the purposes of establishing eligibility for benefits “only occurs upon actual delivery to and receipt” by ERS.

Thus, if the application is mailed, some means of demonstrating that the application was received by the System is critical to an individual’s ability to prove that his or her application for benefits was filed within the time period required.

Upholding the Comptroller’s decision that Jarek’s “act of mailing his application for ordinary disability retirement benefits” was not the equivalent of filing such an application, the Appellate Division said that this determination was reasonable and thus must be sustained under the circumstances.

The court said that “[w]hile the result is harsh, it is one the law compels.

The Appellate Division noted that Jarek claimed that he “did everything within his power to meet the 90-day deadline ....”

However, said the court, Jarek “failed to use available mailing methods which would have provided him with notice of [ERS’s] receipt (or lack thereof) of his application and further waited over six months to check on its status.”

It is clearly prudent to make certain that the individual can prove that he or she timely filed such an application.

Had Jarek used certified or registered mail -- or delivered his application in person and obtained a receipt -- he would have had a better chance of prevailing even if ERS had lost his application after receiving it. 

* Sections 62 and 63 of the Retirement and Social Security Law require a member to file his or her application for ordinary disability retirement benefits within 90 days of his or her last day of service. Accordingly, Jarek had to file his application within 90 days of March 4, 1993.

Considering the employee's personnel record in setting a disciplinary penalty

Considering the employee's personnel record in setting a disciplinary penalty

Thomas v Mt. Vernon, 267 AD2d 241

The Thomas ruling points out the elements that must be observed if the appointing officer wishes to consider an employee’s personnel record in setting a disciplinary penalty.

Robin Thomas was employed by the Mount Vernon Department of Public Safety. She was terminated from her position after being found guilty of habitual lateness. Thomas appealed the Commissioner of Public Safety’s determination.

Although the Appellate Division sustained the commissioner’s decision finding her guilty of the charges filed against her, it remanded the matter to him “for a new determination as to the penalty to be imposed” (Thomas v City of Mount Vernon, 249 AD2d 483).

When the original penalty - dismissal - was again imposed, Thomas again appealed. She contended that her “prior disciplinary record” was considered in setting the penalty.

Thomas argued that although the commissioner considered her prior disciplinary record, he failed to comply with the procedures set out by the Court of Appeals in Bigelow v Village of Gouverneur (63 NY2d 470) in such situations.

The Appellate Division observed that an employee’s prior disciplinary history could be considered in setting a disciplinary penalty if:

1. The individual is advised that his or her prior disciplinary record would be considered in setting the penalty to be imposed; and

  

2. The employee is given an opportunity to submit a written response to any adverse material contained in the record or offer “mitigating circumstances.”

The court said that there was nothing in the record to support Thomas’ claim that she was denied an opportunity to review her personnel record or to submit her objections in writing prior to the commissioner making his determination as to the appropriate penalty to be imposed. Accordingly, it ruled that the commissioner had complied with the standards set out by the Court of Appeals in Bigelow.

As to the penalty imposed - dismissal - the Appellate Division said that it was persuaded that the penalty met the Pell standard as it was not “so disproportionate to the offense, in the light of all the circumstances, as to be shocking to one’s sense of fairness” [Pell v Board of Education, 34 NY2d 222].

Commenting that Thomas’ conduct that resulted in this disciplinary action, together with her conduct underlying a previous suspension, “established a pattern of excessive absences and a failure to correct this behavior after her suspension,” the Appellate Division sustained her termination and dismissed her appeal.

Termination for violating the employee’s “last chance agreement” disqualifies individual for unemployment insurance benefits

Termination for violating the employee’s “last chance agreement” disqualifies individual for unemployment insurance benefits

Matter of Brown v Lincoln Ctr. for The Performing Arts, Inc., 2011 NY Slip Op 02982, Appellate Division, Third Department

Gloria Brown worked for as a security guard at a performing arts center for more than nine years. Brown had a history of disciplinary violations and after an incident in which she left her post without authorization, she and Lincoln Center entered into a “last chance agreement” that provided that her employment would be terminated if she committed further disciplinary infractions.

In December 2009, Brown met with representatives of the employer to discuss certain policy violations, including her failure to dress in the appropriate manner and to remain attentive at her post. The meeting was prematurely ended because of Brown’s behavior and another meeting was scheduled for early January 2010 with her union representative was present. Ultimately Brown was terminated and she applied for unemployment insurance benefits.

An Unemployment Insurance Administrative Law Judge concluded that Brown was terminated for misconduct and upheld the initial determination denying her unemployment benefits.

The Unemployment Insurance Appeal Board, however, overruled the Administrative Law Judge and awarded Brown benefits, finding that Lincoln Center “had not enforced the last chance agreement by allowing claimant to commit other disciplinary infractions without consequence prior to the December 2009 meeting.” Lincoln Center appealed and the court vacated the Board’s decision.

Noting that insubordinate behavior and, or, disrespectful conduct toward a supervisor has been held to constitute misconduct disqualifying a claimant from receiving unemployment insurance benefits, the Appellate Division found that the record contained ample evidence that Brown became loud, boisterous and disrespectful toward her supervisor during the December 2009 meeting. This clearly amounted to insubordination violative of the last chance agreement and was the equivalent of disqualifying misconduct.

As to the Board's finding that the Center “had not enforced the last chance agreement,” the Appellate Division said found “the record is devoid of evidence” establishing that the employer neglected to enforce the last chance agreement with respect to disciplinary infractions committed by Brown prior to the December 2009 meeting and that Brown was somehow misled thereby.

Although the Center’s director of human resources testified that Brown committed some minor violations, the nature and extent of them were not disclosed. However, said the Appellate Division, “it was the employer's prerogative” to determine if such acts constituted a level of misconduct warranting termination and the director stated that they did not.

Thus, said the court, substantial evidence does not support the Board's decision awarding Brown unemployment insurance benefits.

The decision is posted on the Internet at:

http://www.courts.state.ny.us/reporter/3dseries/2011/2011_02982.htm