DiMasi v. State Board of Retirement , 474 Mass. 194 ( 2016 )

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SJC-11971
SALVATORE F. DiMASI vs. STATE BOARD OF RETIREMENT & others.1
Suffolk. February 9, 2016. - April 21, 2016.
Present: Gants, C.J., Spina, Cordy, Botsford, Duffly, Lenk, &
Hines, JJ.
Public Employment, Forfeiture of retirement benefits.
Retirement. State Board of Retirement. Contribution.
Words, "Final conviction."
Civil action commenced in the Supreme Judicial Court for
the county of Suffolk on June 16, 2014.
The case was reported by Cordy, J.
Thomas R. Kiley for the plaintiff.
David R. Marks, Assistant Attorney General, for the
defendants.
SPINA, J. After the plaintiff, Salvatore F. DiMasi, was
convicted of several violations of Federal law, the State Board
of Retirement (board) unanimously approved the forfeiture of his
retirement allowance in accordance with G. L. c. 32, § 15 (4),
1
Justices of the Boston Municipal Court Department, as
nominal parties.
2
and a judge in the Boston Municipal Court Department affirmed
the board's decision. DiMasi filed a complaint for relief in
the nature of certiorari pursuant to G. L. c. 249, § 4, in the
Supreme Judicial Court for Suffolk County. A single justice
reserved and reported the case for determination by the full
court. DiMasi contends that a "final conviction" of a criminal
offense for purposes of § 15 (4) occurs at the conclusion of the
appellate process, not when a sentence is imposed. He further
contends that the board improperly has withheld his accumulated
total deductions since September, 2011. For the reasons that
follow, we conclude that, in the context of pension forfeiture,
a "final conviction" occurs when an individual is sentenced. We
further conclude that DiMasi is entitled to the return of his
accumulated total deductions, together with interest on such
deductions from September, 2011, until such time as payment is
made.
1. Statutory framework. The provisions of G. L. c. 32,
§ 15, "pertain to dereliction of duty by a member of the
contributory retirement system for public employees (member)."
See State Bd. of Retirement v. Bulger, 446 Mass. 169, 170 (2006)
(Bulger). General Laws c. 32, § 15 (4), states as follows:
"In no event shall any member after final conviction
of a criminal offense involving violation of the laws
applicable to his office or position, be entitled to
receive a retirement allowance under the provisions of
[§§ 1-28], inclusive, nor shall any beneficiary be entitled
3
to receive any benefits under such provisions on account of
such member. The said member or his beneficiary shall
receive, unless otherwise prohibited by law, a return of
his accumulated total deductions; provided, however, that
the rate of regular interest for the purpose of calculating
accumulated total deductions shall be zero"2 (emphasis
added).
This statutory provision applies to criminal offenses committed
on or after its effective date of January 12, 1988. See St.
1987, c. 697, §§ 47, 135. "Forfeiture of a retirement allowance
pursuant to G. L. c. 32, § 15 (4), is 'mandatory and occurs by
operation of law . . . . [It] is an automatic legal consequence
of conviction of certain offenses.'" Retirement Bd. of
Somerville v. Buonomo, 467 Mass. 662, 663-664 (2014) (Buonomo),
quoting State Bd. of Retirement v. Woodward, 446 Mass. 698, 705
(2006) (Woodward). Such forfeiture is intended to deter
misconduct by public employees, protect the public fisc, and
2
"A public employee's pension is made up of two components.
The first component is 'regular deductions,' G. L. c. 32, § 1,
also known as 'employee contributions,' G. L. c. 32, § 22 (1)
(b), . . . which are deducted from employee pay. The 'regular
interest' on those deductions, G. L. c. 32, § 1, see G. L.
c. 32, § 22 (6) (a), (b), and the regular deductions comprise
the employee's 'accumulated total deductions.' G. L. c. 32,
§ 1. The accumulated total deductions are then invested in an
investment account. The second component is made up of the
'employer contributions,' see G. L. c. 32, § 22 (3), which are
also invested. At retirement, the employee receives a
'retirement allowance' consisting of an 'annuity,' funded by the
accumulated total deductions, and a 'pension,' funded by
employer contributions and earnings. G. L. c. 32, § 1."
Haverhill Retirement Sys. v. Contributory Retirement Appeal Bd.,
82 Mass. App. Ct. 129, 130 n.2 (2012). Payment of a retirement
allowance is made monthly, on the last business day of each
month.
4
preserve respect for government service. See MacLean v. State
Bd. of Retirement, 432 Mass. 339, 351 (2000).
2. Factual and procedural background. The facts are taken
from the parties' joint statement of agreed material facts,
which we have supplemented with undisputed facts from the
record. DiMasi, a former Speaker of the Massachusetts House of
Representatives, resigned from that position on January 27,
2009. He filed an application with the board on February 11,
2009, seeking a superannuation retirement allowance pursuant to
G. L. c. 32, § 5. The board approved DiMasi's application and
began to pay him monthly retirement benefits as of February 27,
2009.3
On June 2, 2009, a Federal grand jury indicted DiMasi in
the United States District Court for the District of
Massachusetts, alleging various violations of Federal laws.4 The
3
When Salvatore F. DiMasi retired, his annuity savings
account contained $155,155.20, consisting of $127,010.05 in
employee contributions and $28,145.15 in interest through the
year 2008.
4
DiMasi was indicted on three counts of devising a scheme
to deprive the public of its right to honest services through
the use of the mail (honest services mail fraud), 18 U.S.C.
§§ 1341, 1346 (2006); four counts of devising a scheme to
deprive the public of its right to honest services through the
use of wire transmissions (honest services wire fraud), 18
U.S.C. §§ 1343, 1346 (2006); and one count of conspiracy to
commit mail and wire fraud, 18 U.S.C. § 371 (2006). A
superseding indictment filed on October 13, 2009, added one
count of extortion under color of official right, 18 U.S.C.
§ 1951 (2006).
5
indictment pertained to criminal acts purportedly committed by
DiMasi while in the performance of his official duties.5 On
June 9, 2009, the board notified DiMasi that it had received
information pertaining to the indictment, that it was initiating
a proceeding to review the Federal charges in conjunction with
G. L. c. 32, § 15, and that it would be withholding further
payments of his retirement allowance. The board subsequently
voted to suspend DiMasi's retirement allowance, effective
November 1, 2009.
DiMasi filed a petition in the Boston Municipal Court
seeking judicial review of the board's decision. On July 13,
2010, summary judgment entered in favor of DiMasi. A judge
determined, in part, that the existence of the indictment,
standing alone, did not provide a sufficient basis for
concluding that the charges against DiMasi were true, and that
the board did not have the authority under G. L. c. 32, § 15, to
temporarily withhold DiMasi's retirement benefits in the
circumstances of this case. Accordingly, the judge ordered the
board to resume the payment of DiMasi's retirement allowance and
to pay him the amounts that had been withheld. On September 7,
5
More specifically, the indictment alleged that DiMasi
orchestrated and participated in a scheme to use his authority
and influence as Speaker of the Massachusetts House of
Representatives improperly to enable a computer software company
to secure multimillion dollar procurement contracts from
agencies of the Commonwealth, with the purpose of obtaining
bribes and kickbacks for himself and several coconspirators.
6
2010, the board appealed that decision by filing a complaint for
relief in the nature of certiorari pursuant to G. L. c. 249,
§ 4, in the Supreme Judicial Court for Suffolk County. A single
justice ordered the matter transferred to the Superior Court in
accordance with G. L. c. 211, § 4A, for disposition.
In the spring of 2011, a Federal trial was held on the
criminal charges against DiMasi and several alleged
coconspirators. See notes 4 and 5, supra. On June 15, 2011,
the jury found DiMasi guilty of seven counts of the superseding
indictment, and not guilty of two other counts.6 The board filed
an "emergency" motion in the pending action that had been
transferred by the single justice to the Superior Court,
seeking, among other things, to suspend DiMasi's retirement
allowance and to place the benefits that he was owed into an
escrow account. Following a hearing, a Superior Court judge
denied the board's motion. The judge concluded that because
DiMasi had not yet been sentenced, there was no final conviction
that mandated the forfeiture of his retirement allowance under
G. L. c. 32, § 15.
6
DiMasi was found guilty of two counts of honest services
mail fraud, three counts of honest services wire fraud, one
count of conspiracy to commit mail and wire fraud, and one count
of extortion under color of official right. See note 4, supra.
He was found not guilty of one count of honest services mail
fraud and one count of honest services wire fraud. See id.
7
On September 9, 2011, DiMasi was sentenced in the United
States District Court for the District of Massachusetts to
ninety-six months in a Federal prison.7 As a consequence, the
board voted at a special meeting held on September 15, 2011, to
suspend payment of DiMasi's retirement allowance, commencing
with the September 30, 2011, payment. A judgment of conviction
against DiMasi was entered in the Federal court on September 27,
2011. The following day, DiMasi filed a notice of appeal in the
United States Court of Appeals for the First Circuit.
On October 18, 2011, DiMasi filed in the Boston Municipal
Court a petition for review of the board's September 15 decision
to suspend his retirement benefits without first conducting a
hearing. A hearing officer for the board subsequently held an
evidentiary hearing on November 2, 2011, concerning the
applicability of G. L. c. 32, § 15, to DiMasi's retirement
allowance. By decision dated August 8, 2012, the hearing
officer found that because DiMasi's criminal convictions
involved violations of the laws applicable to his office or
position, the pension forfeiture provisions of G. L. c. 32, § 15
(4), were applicable to his case. The hearing officer stated
that DiMasi's convictions became "final" for purposes of § 15
(4) when he was sentenced on September 9, 2011. Consequently,
7
DiMasi's sentences also included twenty-four months of
supervised release, the forfeiture of $65,000, and a special
assessment of $700.
8
the hearing officer continued, DiMasi forfeited his retirement
allowance as of that date. The hearing officer further found
that pursuant to § 15 (4), DiMasi was entitled to the return of
his accumulated total deductions, but the interest rate
applicable to such deductions was zero per cent. Finally, the
hearing officer stated that the board was not entitled to recoup
retirement payments made to DiMasi before September 9, 2011,
because G. L. c. 32, § 15 (6),8 is only applicable to members who
retire on or after April 2, 2012, and DiMasi retired on
January 27, 2009. The board unanimously voted to accept the
hearing officer's decision at its meeting on August 30, 2012.
On October 18, 2012, DiMasi filed another petition for
review in the Boston Municipal Court.9 He asserted that the
board improperly terminated his retirement allowance because
there was no "final conviction" within the meaning of G. L.
c. 32, § 15 (4), given that he had not yet exhausted his direct
appeals. DiMasi also asserted that the board had failed to
8
General Laws c. 32, § 15 (6), inserted by St. 2011,
c. 176, § 31, provides: "If a member's final conviction of an
offense results in a forfeiture of rights under this chapter,
the member shall forfeit, and the board shall require the member
to repay, all benefits received after the date of the offense of
which the member was convicted" (emphasis added). This section
"shall apply only to members retiring on or after April 2,
2012." St. 2011, c. 176, § 65.
9
The petition for review filed in the Boston Municipal
Court Department on October 18, 2012, incorporated by reference
the pertinent allegations set forth in the petition for review
filed on October 18, 2011.
9
return his accumulated total deductions as required by § 15 (4).
The board filed the administrative record as its answer. On
November 22, 2013, DiMasi filed a motion for summary judgment.
Meanwhile, on August 21, 2013, the United States Court of
Appeals for the First Circuit affirmed DiMasi's criminal
convictions and sentences. His subsequent petitions for
rehearing were denied. On January 27, 2014, the United States
Supreme Court denied DiMasi's petition for a writ of certiorari.
By decision dated April 17, 2014, a judge in the Boston
Municipal Court denied DiMasi's motion for summary judgment and
affirmed the board's August 30, 2012, decision. The judge
pointed out that the only matter of dispute between the parties
was when DiMasi's convictions became "final" for purposes of
G. L. c. 32, § 15 (4). After considering the language and
intent of the statute, the judge agreed with the board that the
term "final" meant the date when DiMasi was sentenced --
September 9, 2011 -- and not the date when all of his direct
appeals were exhausted -- January 27, 2014.
3. Standard of review. "General Laws c. 249, § 4,
provides for limited judicial review in the nature of certiorari
to correct errors of law in administrative proceedings where
judicial review is otherwise unavailable." Bulger, 446 Mass. at
173. See Sheriff of Plymouth County v. Plymouth County
Personnel Bd., 440 Mass. 708, 710 (2004). Certiorari allows a
10
court to "correct only a substantial error of law, evidenced by
the record, which adversely affects a material right of the
plaintiff. . . . In its review, the court may rectify only
those errors of law which have resulted in manifest injustice to
the plaintiff or which have adversely affected the real
interests of the general public." Massachusetts Bay Transp.
Auth. v. Auditor of the Commonwealth, 430 Mass. 783, 790 (2000),
quoting Carney v. Springfield, 403 Mass. 604, 605 (1988).
4. "Final conviction" of a criminal offense. "Our
analysis of G. L. c. 32, § 15 (4), is guided by the familiar
principle that 'a statute must be interpreted according to the
intent of the Legislature ascertained from all its words
construed by the ordinary and approved usage of the language,
considered in connection with the cause of its enactment, the
mischief or imperfection to be remedied and the main object to
be accomplished, to the end that the purpose of its framers may
be effectuated.'" Buonomo, 467 Mass. at 668, quoting Hanlon v.
Rollins, 286 Mass. 444, 447 (1934). See Sullivan v. Brookline,
435 Mass. 353, 360 (2001), and cases cited. "Courts must
ascertain the intent of a statute from all its parts and from
the subject matter to which it relates, and must interpret the
statute so as to render the legislation effective, consonant
with sound reason and common sense." Buonomo, supra. "For
purposes of statutory construction, G. L. c. 32, § 15 (4), is
11
considered to be penal and, therefore, its language must be
construed narrowly, not stretched to accomplish an unexpressed
result." Bulger, 446 Mass. at 174-175. See Gaffney v.
Contributory Retirement Appeal Bd., 423 Mass. 1, 3 n.3 (1996),
citing Collatos v. Boston Retirement Bd., 396 Mass. 684, 686-687
(1986).
The statutory provisions governing retirement benefits for
public employees do not include a definition of the term "final
conviction" of a criminal offense. See G. L. c. 32, §§ 1, 15.
However, it is well established that, "[i]n criminal cases, the
final judgment is the sentence." Doe, Sex Offender Registry Bd.
No. 10800 v. Sex Offender Registry Bd., 459 Mass. 603, 621
(2011). See Commonwealth v. Brown, 466 Mass. 676, 679 (2013)
(criminal conviction not final under Massachusetts law until
sentence is imposed on defendant); Commonwealth v. Dascalakis,
246 Mass. 12, 19 (1923). See also Fort Wayne Books, Inc. v.
Indiana, 489 U.S. 46, 54 (1989) (finality in criminal
prosecution generally "is defined by a judgment of conviction
and the imposition of a sentence"); Berman v. United States, 302
U.S. 211, 212 (1937).
The applicability of this common meaning of finality to a
pension forfeiture case initially was described in Woodward, 446
Mass. at 707 n.8. There, this court held, in relevant part,
that a pension forfeiture under G. L. c. 32, § 15 (4), is not an
12
action in contract and, therefore, is not subject to any period
of limitations. Id. at 705-706, 708. In connection with our
holding, we stated that a judge in the Wrentham Division of the
District Court Department incorrectly concluded that the board's
implementation of the forfeiture under § 15 (4) was untimely.
Id. at 707 n.8. We explained that the term "final conviction,"
as used in § 15 (4), "should be given its specialized technical
meaning, . . . [namely,] the sentence that is imposed in a
criminal proceeding" (citation omitted). Id. Cf. MacLean, 432
Mass. at 343-344 (pension forfeiture pursuant to G. L. c. 32,
§ 15 [4], triggered when defendant was "sentenced" to probation
after pleading guilty to violations of conflict of interest law,
G. L. c. 268A, § 7). Although our articulation of the proper
meaning of "final conviction" appears in a footnote in Woodward,
it is not dicta. Rather, the explanation in that footnote
addressed an additional aspect of the District Court judge's
ruling and supplemented this court's central holding.
In essence, the imposition of a defendant's sentence in a
criminal case constitutes both the final judgment in that case
and the "final conviction" for purposes of G. L. c. 32, § 15
(4). The defendant no longer is shielded by the presumption of
innocence, the consequences of the conviction may be imposed,
and the criminal case is ripe for appeal. See 18 U.S.C.
§ 3143(b) (2006) (absent specified findings, judicial officer
13
"shall order that a person who has been found guilty of an
offense and sentenced to a term of imprisonment, and who has
filed an appeal or a petition for a writ of certiorari, be
detained" to commence serving time under criminal sentence);
G. L. c. 279, § 4 ("Sentence shall be imposed upon conviction of
a crime, regardless of whether an appeal has been taken," except
in limited circumstances upon conviction of capital crime). See
also Flanagan v. United States, 465 U.S. 259, 263 (1984) ("In a
criminal case the [final judgment] rule prohibits appellate
review until conviction and imposition of sentence");
Commonwealth v. Bruneau, 472 Mass. 510, 515-516 (2015), and
cases cited. Here, DiMasi was sentenced on his Federal
convictions on September 9, 2011. With respect to pension
forfeiture under G. L. c. 32, § 15 (4), this date constituted
his "final conviction."
We distinguish a "final conviction" for purposes of § 15
(4) from a final judgment occurring at the conclusion of the
appellate process. "Finality is variously defined; like many
legal terms, its precise meaning depends on context." Clay v.
United States, 537 U.S. 522, 527 (2003). In other contexts, we
have recognized that a judgment becomes final and a case is
closed when all avenues of appeal have been exhausted or the
time for appeal has expired. See, e.g., Sliney v. Previte, 473
Mass. 283, 284, 289-290 (2015) (enlargement of statute of
14
limitations period for civil actions alleging sexual abuse of
minor had retroactive application in case where judgment not
"final" due to pendency of petition for rehearing and
application for further appellate review on amended law's
effective date); Commonwealth v. Augustine, 467 Mass. 230, 257
(2014), S.C., 470 Mass. 837 (2015) (judicial opinion announcing
new rule of law has retroactive application "only to cases in
which a defendant's conviction is not final, that is, to cases
pending on direct review" in which relevant issue was raised);
Foxworth v. St. Amand, 457 Mass. 200, 205-206 & n.7 (2010) (for
purposes of Federal habeas corpus review, once direct appeal to
State court has been decided, conviction becomes final on date
when rescript issues to lower court); State Tax Comm'n v.
Assessors of Haverhill, 331 Mass. 306, 309 (1954) (until pending
appeal has been decided or time for appeal has expired, there is
no "final determination" by Appellate Tax Board because its
decision may have to be modified as consequence of appeal). In
the context of a pension forfeiture case, however, this is not
the meaning of finality that we ascribe to the term "final
conviction" in § 15 (4).
Interpreting the language of § 15 (4) as requiring pension
forfeiture only after the conclusion of the appellate process,
as DiMasi suggests, would contravene the Legislature's intent
and lead to absurd results. Such a reading would encourage
15
frivolous appeals and delaying tactics so that a member who has
been convicted of a criminal offense involving a violation of
the laws applicable to his or her office or position could
continue to receive a retirement allowance for as long as
possible. As we have pointed out, § 15 (4) is designed to deter
misconduct by public employees, to protect the public fisc, and
to preserve respect for government service. MacLean, 432 Mass.
at 351. It is reasonable to infer that, once a member has been
convicted of a criminal offense relating to the member's office
or position, the Legislature would want to preclude such member
from continuing to receive public monies, in the form of a
retirement allowance, during the pendency of the member's
appeal. Should the member ultimately prevail at the end of the
appellate process, the member could recoup the portion of the
retirement allowance that had been withheld subsequent to the
member's sentencing on the criminal conviction. In this manner,
the interests of both the member and the board are protected.
Furthermore, G. L. c. 32, § 15 (4), uses the phrase "after
final conviction of a criminal offense." It does not refer to a
"final conviction after all appeals have been exhausted," or
words to that effect. Contrast, e.g., G. L. c. 21J, § 9 (d)
(eligibility for reimbursement from underground storage tank
petroleum product cleanup fund requires "a final judgment from a
court of competent jurisdiction, all rights of appeal being
16
exhausted, waived, or expired"); G. L. c. 79, § 36A (payment of
damages award for taking by right of eminent domain shall be
made "within thirty days after all rights of appeal [from the
judgment] have been exhausted or waived"). Had the Legislature
intended that pension forfeiture not occur until the conclusion
of the appellate process in the criminal case, it easily could
have included language to that effect in the relevant statutory
provisions. We conclude that the board's interpretation of
"final conviction" as referring to the imposition of sentence is
consistent with the language and purposes of the statute.10
DiMasi forfeited his entitlement to a retirement allowance on
September 9, 2011.
5. Return of accumulated total deductions. DiMasi
contends that since September, 2011, the board wrongfully has
withheld his accumulated total deductions of $127,010.05 in
violation of G. L. c. 32, § 15 (4). See notes 2 and 3, supra.
As a consequence, he continues, the board has deprived him of
funds that could have financed his appeal and provided his
family with much needed health insurance coverage. DiMasi
10
Pursuant to its authority under G. L. c. 32, § 20 (5)
(b), to make rules and regulations consistent with law, the
board promulgated 941 Code Mass. Regs. § 2.10(2) (2013), which
defines the term "final conviction" as "the entry of a judgment
of a judge or jury that a person is guilty of a crime as charged
and the imposition of sentence for that crime." Although this
regulation was not in effect at the time DiMasi was sentenced,
it is consistent with our interpretation of the term "final
conviction."
17
argues that the board must return his accumulated total
deductions without further delay. We agree.11
The plain language of G. L. c. 32, § 15 (4), permits a
member "after final conviction of a criminal offense involving
violation of the laws applicable to his office or position" to
receive "a return of his accumulated total deductions," but "the
rate of regular interest for the purpose of calculating
accumulated total deductions shall be zero." In essence, this
means that the member is entitled to the return of his employee
contributions (here, $127,010.05), but is not entitled to the
interest that has accrued on those contributions.12 Nothing in
§ 15 (4) requires that a member repay the retirement benefits
that the member received prior to a final conviction of a
specified criminal offense, or that the board subtract such
retirement benefits from the accumulated total deductions that
11
In her decision dated April 17, 2014, denying DiMasi's
motion for summary judgment and affirming the board's decision,
the judge in the Boston Municipal Court stated that the parties
were in agreement that DiMasi was entitled to receive a return
of his accumulated total deductions as set forth in G. L. c. 32,
§ 15 (4). The judge further stated that the parties also were
in agreement that because G. L. c. 32, § 15 (6), was not
applicable to DiMasi, see note 8, supra, the board was not
entitled to recoup payments already made to him as of the date
of his final conviction.
12
Even though the member is not entitled to the interest
that has accrued on his own contributions during the tenure of
his employment, the funds that are returned to the member still
are referred to as "accumulated total deductions." See note 2,
supra.
18
must be returned to the member.13 In contrast, see G. L. c. 32,
§ 15 (6), and note 8, supra. Offenses that are covered by § 15
(4) "cause [the] loss of only future pension benefit payments
and accumulated interest" (emphasis added). Gaffney, 423 Mass.
at 3 n.3. "[T]he member still recovers actual deductible
contributions." Id. at 5. Accordingly, we conclude that DiMasi
is entitled to receive his accumulated total deductions in the
amount of $127,010.05, which the board has withheld since
September, 2011.
DiMasi further contends that because the board has failed
to return his accumulated total deductions, he is entitled to
interest on those deductions from September, 2011, until such
time as payment is made in accordance with G. L. c. 32, § 20 (5)
(c) (2),14 and Herrick v. Essex Regional Retirement Bd., 465
Mass. 801, 802 (2013). We agree.15
13
To the extent that our decision today is inconsistent
with the portion of Flaherty v. Justices of the Haverhill Div.
of the Dist. Court Dep't of the Trial Court, 83 Mass. App. Ct.
120, 125, cert. denied, 134 S. Ct. 325 (2013), that pertains to
the reimbursement of retirement benefits previously received by
a member, that portion is overruled. The remainder of the
Flaherty decision is unaffected and continues to be good law.
14
General Laws c. 32, § 20 (5) (c) (2), provides, in
pertinent part:
"When an error exists in the records maintained by the
system or an error is made in computing a benefit and, as a
result, a member or beneficiary receives from the system
more or less than the member or beneficiary would have been
entitled to receive had the records been correct or had the
19
Recognizing that "errors are bound to occur" in a
complicated system like the one governed by G. L. c. 32, Boston
Retirement Bd. v. McCormick, 345 Mass. 692, 698 n.5 (1963), the
Legislature enacted § 20 (5) (c) (2), to provide relief from
such errors. In Herrick, supra at 809, this court interpreted
§ 20 (5) (c) (2) as providing "a remedy for all errors made by
the board that affect the amount of benefits a member or
beneficiary receives, allowing the error to be corrected so that
members and beneficiaries receive the actuarial equivalent of
the benefits they would have received had the board not erred"
(emphasis in original). At issue in that case was whether a
member of a public employee contributory retirement system
governed by G. L. c. 32, §§ 1-28, who pleaded guilty to sexually
assaulting his daughter, was entitled to prejudgment interest on
a retroactive award of superannuation retirement benefits and,
if so, at what rate. See Herrick, supra at 802. We concluded
that where "a retirement board makes a legal error in denying
error not been made, the records or error shall be
corrected . . . as far as practicable, and future payments
shall be adjusted so that the actuarial equivalent of the
pension or benefit to which the member or beneficiary was
correctly entitled shall be paid."
15
To be clear, the interest claimed by DiMasi is not that
which is part of "accumulated total deductions," because he is
not entitled to such interest under G. L. c. 32, § 15 (4).
Rather, DiMasi seeks interest for the unlawful withholding of
his own employee contributions (to which he is entitled) by the
board beginning in September, 2011.
20
retirement benefits that is corrected by a court, [a member] is
entitled to a rate of interest determined by the board's actuary
'so that the actuarial equivalent of the pension or benefit to
which the member . . . was correctly entitled shall be paid.'"16
Id., quoting G. L. c. 32, § 20 (5) (c) (2).
Here, after DiMasi's final conviction, the board
erroneously continued to withhold his accumulated total
deductions instead of returning them to DiMasi in conformity
with the clear language of § 15 (4). This happened
notwithstanding the board's unanimous vote on August 30, 2012,
to accept the hearing officer's decision in which he concluded
that DiMasi was entitled to the return of his accumulated total
deductions. See note 11, supra. By failing to return such
deductions, the board denied DiMasi the use and benefit of his
own contributions that he had made to the State employees'
retirement system during the tenure of his employment. Given
the board's error, we conclude that DiMasi is entitled to
interest on his accumulated total deductions from September,
2011, until such time as payment is made. Cf. Conway v. Electro
Switch Corp., 402 Mass. 385, 390 (1988) (according to
fundamental principle of common law, "interest is awarded to
16
The "actuarial equivalent" is defined in G. L. c. 32,
§ 1, as "any benefit of equal value when computed upon the basis
of a mortality table to be selected by the actuary and an
interest rate determined by the actuary."
21
compensate a damaged party for the loss of use or the unlawful
detention of money"). Absent this remedy, the board has no
incentive to ensure the prompt repayment of a member's
accumulated total deductions. The board's actuary shall
determine the appropriate interest rate "so that the actuarial
equivalent of the pension or benefit to which [DiMasi] was
correctly entitled shall be paid." Herrick, 465 Mass. at 802,
quoting G. L. c. 32, § 20 (5) (c) (2).
6. Conclusion. This case is remanded to the county court
where the single justice shall enter a judgment affirming the
decision of the Boston Municipal Court. The single justice also
shall remand the case to the Boston Municipal Court for entry of
an order directing the board to return DiMasi's accumulated
total deductions forthwith, together with appropriate interest
as calculated by the board's actuary.
So ordered.