Worcester Regional Retirement Board v. Contributory Retirement Appeal Board ( 2017 )

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17-P-66 Appeals Court
WORCESTER REGIONAL RETIREMENT BOARD vs. CONTRIBUTORY
RETIREMENT APPEAL BOARD & others.1
No. 17-P-66.
Worcester. October 11, 2017. - November 29, 2017.
Present: Milkey, Massing, & Ditkoff, JJ.
Contributory Retirement Appeal Board. County, Retirement board.
Municipal Corporations, Retirement board, Pensions. Public
Employment, Retirement, Retirement benefits. Retirement.
Pension.
Civil action commenced in the Superior Court Department on
September 15, 2015.
The case was heard by Shannon Frison, J., on motions for
judgment on the pleadings.
Michael Sacco for the plaintiff.
Thomas F. Gibson for Middlesex County Retirement Board.
MASSING, J. The Worcester Regional Retirement Board (WRRB)
appeals from a judgment of the Superior Court, which affirmed a
decision of the Contributory Retirement Appeal Board (CRAB)
1
Middlesex County Retirement Board; Brian Pierce.
2
requiring the WRRB to permit a former member to purchase nine
additional months of creditable service.2 At issue is whether
the WRRB is responsible for not having enrolled the employee,
Brian Pierce, as of the day he became eligible for membership,
or whether Pierce had an affirmative obligation to ensure that
he had been enrolled as of his start date. CRAB determined that
the responsibility lay with the WRRB, not the employee; that the
retirement system records should be corrected to reflect
Pierce's nine months of uncredited membership; and that Pierce
should be permitted to buy back the time of which he had
erroneously been deprived. Discerning no legal error or abuse
of discretion on CRAB's part, we affirm.
Background. Pierce began permanent, full-time employment
as a third-class lineman for the Princeton Municipal Light
Department, which is a member unit of the Worcester Regional
Retirement System (WRRS), on December 6, 1982. On October 24,
1983, Pierce completed a new entrant enrollment form "[i]n order
that [he] may be properly enrolled" in the WRRS.3 The WRRB
stamped the form as received on November 18, 1983. The form
2
Neither CRAB nor Pierce has participated in this appeal.
Their interests have been represented by the Middlesex County
Retirement Board, the pension system of which Pierce was a
member when he retired.
3
Pierce dated the form October 24, 1982. As the Princeton
treasurer verified the form on October 24, 1983, and the form
referenced a start date of December 6, 1982, it is most likely
that Pierce misdated his signature.
3
correctly indicated that Pierce's full-time permanent employment
had begun on December 6, 1982. The WRRB enrolled Pierce as a
member as of September 1, 1983, crediting him with service prior
to its receipt of his enrollment form, but not for the first
nine months of his employment starting on December 6, 1982.
Pierce's service with the town of Princeton ended on May 1,
1986, when he took a similar position with the Middleborough
Light Department. At that time, Pierce became a member of the
Plymouth County Retirement System, and his funds in the WRRS,
representing two years and eight months of service (September 1,
1983, to May 1, 1986) were transferred to the Plymouth system.
After ten years and one month of service in Middleborough,
Pierce went to work for the Littleton Light Department, and his
funds within the Plymouth system were transferred to the
Middlesex County Retirement System (MCRS). On June 30, 2008,
after eleven years and nine months of service in Littleton,
Pierce retired from service with superannuation retirement
benefits through the MCRS.4
Shortly before his retirement, Pierce initiated a request
to purchase from the WRRS the nine months of full-time service
4
As of May 14, 2009, the Public Employee Retirement
Administration Commission calculated that the WRRS was
responsible for 10.84761 percent of Pierce's total service time,
based on the two years and eight months between September 1,
1983, and May 1, 1986, and directed the WRRB to reimburse the
MCRB $2,630.06 yearly toward Pierce's retirement allowance.
4
for which he had not received credit.5 Following a series of
communications among Pierce, the town of Princeton, the WRRB,
and the MCRS, the WRRB declined to accept Pierce's request and
denied liability for his noncontributing service period.
Pierce, joined by the MCRS, timely appealed from the WRRB's
decision to the Division of Administrative Law Appeals (DALA).
A DALA magistrate concluded that because Pierce correctly
indicated his start date when he applied for membership, "the
WRRB had notice of [his] membership status and eligibility to
purchase that service as of the date he became a member." The
magistrate further stated, "There was no additional onus on
[Pierce] to be proactive and request to purchase said service at
that time. [Pierce] was entitled to retroactive membership from
the moment the WRRB accepted the enrollment form. The omission
was an error of the board." Accordingly, the magistrate
concluded that "the omission of [Pierce] from the system from
his date of hire through September 16 [sic], 1983 was an error
5
A Division of Administrative Law Appeals magistrate
decided the case on memoranda and documents without an
evidentiary hearing. She enumerated "stipulations of fact" from
those materials. She set forth that Pierce made the request to
purchase his service in October, 2009. The CRAB incorporated
the magistrate's "findings of fact" but further found that
"Pierce's request to provide make-up payments for this time was
made on or before May 12, 2008, prior to his retirement." The
CRAB's finding in this regard is supported by documentary
evidence in the record.
5
of the WRRB which must be corrected pursuant to G. L. c. 32,
§ 20(5)(c)(1)."
The WRRB appealed from the DALA magistrate's decision to
CRAB. CRAB adopted the magistrate's findings and conclusions,
adding, "Pierce's application for membership listed his date of
hire and should have resulted in his enrollment commencing on
that date, with any makeup payments necessary. Under these
circumstances he was not required to make a specific request to
purchase those nine months of credible service."
The WRRB sought judicial review of CRAB's decision under
G. L. c. 30A, § 14, and a Superior Court judge affirmed CRAB's
decision. This matter is before us on the WRRB's appeal from
the Superior Court judgment.
Discussion. The standard of review of a CRAB decision in
these circumstances is well established. "Appellate review
under G. L. c. 30A, § 14, is limited to determining whether the
agency's decision was unsupported by substantial evidence,
arbitrary and capricious, or otherwise based on an error of
law." Arlington Contributory Retirement Bd. v. Contributory
Retirement Appeal Bd., 75 Mass. App. Ct. 437, 441 (2009). We
defer to CRAB's expertise, even when conducting de novo review
of legal questions, see ibid.; Haverhill Retirement Sys. v.
Contributory Retirement Appeal Bd., 82 Mass. App. Ct. 129, 131
(2012), but "we are not bound by what we believe is an agency's
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erroneous interpretation of its statutory authority." Bristol
County Retirement Bd. v. Contributory Retirement Appeal Bd., 65
Mass. App. Ct. 443, 451 (2006).
CRAB concluded that the WRRB's failure to enroll Pierce as
of his start date was an error subject to correction under G. L.
c. 32, § 20(5)(c)(2). This section applies "[w]hen 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 error not been made." G. L.
c. 32, § 20(5)(c)(2), as appearing in St. 2000, c. 159, § 91.
In such cases, "the records or error shall be corrected," the
member shall make up any underpayment or be reimbursed for any
overpayment, and future benefit payments are to be recalculated.
Ibid. "This section effectively acknowledges that the
retirement law is a complicated combination of various
legislative efforts occurring at different times and for
different purposes, that it is difficult to administer, and that
it is inevitable that mistakes in implementation will be made."
Bristol County Retirement Bd., 65 Mass. App. Ct. at 449. The
plain language of this section covers the situation here, where
an error exists in the WRRB's records such that Pierce is
receiving lower benefits than he is entitled to receive.
7
The WRRB raises a number or arguments why § 20(5)(c)(2)
should not apply, none of them availing. First, the WRRB
asserts that the CRAB decision is contrary to G. L. c. 32,
§ 3(3), as appearing in St. 1960, c. 535, "Late Entry into
Membership," which permits employees who "failed to become or
elected not to become" a member of a retirement system to "apply
for and be admitted to membership" retroactively under certain
conditions. The WRRB argues that because this provision is
permissive -- members are not required to buy back service -- it
puts the onus on employees to take affirmative steps to purchase
creditable service. Under the circumstances of this case, we do
not agree that § 3(3) applies.
Rather, we agree with the Superior Court judge that "Pierce
neither failed to become nor elected not to become a member of
WRRB. He ultimately became a member of the WRRS when he
submitted his Enrollment Form, and his efforts were only
frustrated due to WRRB's error." Simply put, this appeal does
not present a case of "late entry."
The WRRB also argues that it cannot be ordered to reimburse
the MCRS for benefits attributable to Pierce's first nine months
of service because those nine months did not "pertain" to the
WRRB within the meaning of G. L. c. 32, § 3(8)(c). The WRRB
relies in part on Haverhill Retirement Sys., 82 Mass. App. Ct.
at 133-134, where we held that an employee's service in a
8
retirement system in which he was erroneously enrolled
nonetheless "pertained" to that system because it accepted and
had the use of contributions made on behalf of the employee.
The WRRB's reliance on Haverhill Retirement Sys. is misplaced:
although it did not have the benefit of contributions associated
with Pierce's membership for the first nine months of his
service in Princeton, this was only because the WRRB had failed
to enroll him for those nine months, during which he was
eligible for membership.
The WRRB further claims that employment does not "pertain"
to a particular system unless the employee is a member of that
system. In support of this claim, the WRRB cites prior DALA
decisions stating that "where a member of a retirement system
seeks to buy back prior service in a different retirement
system, the 'different' system is not required to accept
liability for that service, where the former employee was not
entitled to membership in that system when rendering that
'prior' service" (emphasis supplied by the WRRB). Here,
although Pierce was not a member of the WRRS, he was entitled to
membership at the relevant time. His uncredited service
"pertains" to the WRRS.
Finally, the WRRB argues that CRAB's decision is invalid
because it did not make a liability determination under G. L.
c. 32, § 3(8)(c). In fact, the DALA magistrate stated, "A
9
review of the record in this case renders the interpretation
that the system with the liability for [the nine-month period]
is the WRRS." Nonetheless, the magistrate also noted that the
issues of the parties' precise liability was not before her, but
was for "PERAC, the actuary" to determine. See G. L. c. 32,
§ 1, as amended by St. 1996, c. 306, § 6 (defining "actuary" in
relevant part as "a member of the staff of the public employee
retirement administration commission"); G. L. c. 32, § 3(8)(c)
(reimbursements between retirement systems to be computed by the
actuary). We discern no error.
Judgment affirmed.