McLaughlin v. State Employees' Retirement Board , 157 Pa. Commw. 334 ( 1993 )

LORD, Senior Judge.

Francis McLaughlin was employed as a liquor store wholesale clerk with the Pennsylvania Liquor Control board. McLaughlin’s position involved not only paperwork but also lifting and moving cases of liquor (sometimes as heavy as 30 to 75 pounds) while stocking and unloading. On December 13, 1986, he suffered a heart attack, and on March 3, 1987 he had by-pass surgery. In May 1987, he applied for a disability annuity from the State Employees’ Retirement System (SERS). Disability annuities are authorized by section 5308(c) of the State Employees’ Retirement Code (Code).¹ McLaughlin was granted a temporary disability for one year, effective June 13, 1987, subject to subsequent reviews.

In July 1988 the State Employees’ Retirement Board (board) discontinued McLaughlin’s disability annuity as of July 1, 1988. McLaughlin requested and was granted an administrative hearing, after which a hearing examiner recommended to the board that the benefit be discontinued. The board again issued a decision discontinuing benefits as of July 1, 1988 and McLaughlin has appealed.

This Court’s scope of review is to determine whether constitutional rights were violated, an error of law was committed or necessary findings of fact are not supported by substantial evidence. Estate of McGovern v. State Employees’ Retirement Board, 512 Pa. 377, 517 A.2d 523 (1986).

McLaughlin argues that (1) the board erred in agreeing with the hearing examiner that the medical documentation submitted by McLaughlin did not support a finding of continued disability; (2) the board failed to make findings concerning medical reports and assessments submitted on behalf of McLaughlin; (3) the SERS had the burden to prove that McLaughlin could perform his previous duties and that the Board erroneously placed that burden on McLaughlin; and (4) the board failed to consider decisions of the Department of General Services and of the Social Security Administration on McLaughlin’s claims there in making its decision.

We begin our analysis with a consideration of the burden of proof, for it is clear that the hearing examiner² and the board, by agreeing with the “reasoning” of the hearing examiner, placed the burden of proof of continuing disability on McLaughlin. In Cutshall v. Public School Employees’ Retirement Board, 70 Pa.Commonwealth Ct. 146, 452 A.2d 622 (1982), this Court held that once a disability pension is granted and the board seeks to terminate that disability pension, it has the burden of proof and must show that the disability is ended. In Cutshall at 151-152, 452 A.2d at 624, this Court said

The hearing examiner also concluded that Mr. Cutshall had the burden of proving that he remained disabled. This was error. The Retirement Board found Mr. Cutshall to be incapable of performing his teaching duties in 1975. That determination established the then existence of a condition of disability and gave rise to a presumption that the condition continued until the contrary was shown or established by the evidence.

In its brief, SERS points out that that the relevant provision of the Public School Employees’ Retirement Code cited in Cutshall, 24 Pa.C.S. § 8505(c), and the parallel provision in the State Employees’ Retirement Code, 71 Pa.C.S. § 5905(c), were amended in 1985. The old language stated that the board’s medical examiner was to conduct an examination of the applicant and make a recommendation as to continuance of disability based on that medical examination. The new language states that the medical examiner is to make a recommendation based on “a review of subsequent medical reports submitted with an application for continuance of disability ...” SERS argues that, under this language, the burden is now on the applicant to submit supporting medical reports with his application, the board is no longer required to make its own examination of the applicant and, therefore, the burden of proof is now upon the claimant to prove continuing disability.

We do not agree that this statutory change supports the conclusion that the burden of proof has now been shifted to the applicant. In view of our decision in Cutshall, which clearly held that, once the board had granted a disability pension, the burden was on the board to prove that the disability no longer existed, the legislature certainly could have specifically said that the burden of proof was shifted. It did not. This Court will not depart from the conclusion in Cutshall merely because the legislature amended the statute to eliminate the requirement that the board’s medical examiner perform a physical every six months.

In addition to this reasoning, section 5905(c) of the State Employees Retirement Code, 71 Pa.C.S. § 5905(c), provides support for the conclusion that SERS has the burden to prove that an employee is no longer disabled once he has been granted a disability pension. This section provides in part:

(c) Disability annuities.

In every case where the board has received an application for a disability annuity based upon physical or mental incapacity for the performance of the job for which the member is employed, taking into account relevant decisions by the Pennsylvania Workmen’s Compensation board, the board shall ... [review applications and make a determination of disability, non-disability, or non-service connected disability] (emphasis added.)

This language supports the conclusion that when a disability has initially been established, the burden in any termination proceeding, like that in workers compensation proceedings, is on the party alleging that the disability has ceased. See, e.g., Pettigrew v. Workmen’s Compensation Appeal Board (Yarway Co.), 139 Pa.Commonwealth Ct. 488, 590 A.2d 1364 petition for allowance of appeal denied, 529 Pa. 654, 602 A.2d 863 (1991); County of Dauphin v. Workmen’s Compensation Appeal Board (Davis), 136 Pa.Commonwealth Ct. 140, 582 A.2d 434, petition for allowance of appeal denied, 528 Pa. 614, 596 A.2d 160 (1990).

Because the hearing examiner and the Board made an error of law regarding the burden of proof, we vacate and remand for a new hearing.

ORDER

AND NOW, this 27th day of July 1993, it is hereby ordered that the decision of the State Employees’ Retirement Board in the above-captioned matter is vacated and the case is remanded for a new hearing.

Jurisdiction relinquished.

1 . 71 Pa.C.S. § 5308(c).

2 . The hearing examiner in his conclusion of law number one states "claimant has the burden of establishing that he continues to be mentally or physically incapable of performing the duties for which he was employed.”