Bates v. City of New Orleans

137 So.3d 774

Mary BATES

v.CITY OF NEW ORLEANS and New Orleans Employees' Retirement System.

Mary Bates

v.City of New Orleans and New Orleans Employees' Retirement System.

Nos. 2013–CA–1153, 2013–CA–1587.

Court of Appeal of Louisiana, Fourth Circuit.

March 26, 2014.

Joseph G. Albe, Attorney at Law, New Orleans, LA, for Plaintiff/Appellee.

Joyce G. Joseph, Deputy City Attorney, Churita H. Hansell, Interim Chief of Litigation, Cherrell R. Simmons, Senior Chief Deputy, Sharonda R. Williams, City Attorney, New Orleans, LA, for Defendant/Appellant.

(Court composed of Judge ROLAND L. BELSOME, Judge ROSEMARY LEDET, Judge SANDRA CABRINA JENKINS).

ROSEMARY LEDET, Judge.

This is an accidental disability retirement benefits dispute. The plaintiff, Mary Bates, commenced this suit against her former employer, the City of New Orleans (the “City”) and the New Orleans Employees' Retirement System (“NOMERS”). The following is a chronology of the trial court's judgments in this case:

• On October 31, 2012, the trial court rendered judgment in Ms. Bates' favor against the City and NOMERS awarding disability retirement benefits from October 12, 2009 through present and continuing “as allowed by law.” Neither a motion for new trial, nor an appeal was taken from this judgment.

• On April 26, 2013, the trial court rendered judgment granting Ms. Bates' Motion to Enforce the October 31, 2012 Judgment and her Motion for Assessment of Costs. In this judgment,the trial court used the same language as in its October 31, 2012 judgment—benefits “as allowed by law”—but added the following limiting language—“without any credit or offset.” The trial court also awarded various costs—cost in the specific sum of $484.90 and cost in the general sum of “all outstanding costs for this suit including all costs associated with these motions.”

• On August 9, 2013, the trial court rendered judgment granting Ms. Bates' Motion to Hold Defendants in Contempt, awarding $1,500.00 in penalties, all costs associated with these motions, and attorneys' fees.¹

These two consolidated appeals are from the April 26 and the August 9, 2013 judgments, respectively. For the reasons that follow, we reverse in part the April 26, 2013 judgment; and reverse in full the August 9, 2013 judgment.

FACTUAL AND PROCEDURAL BACKGROUND

On February 22, 1999, Ms. Bates sustained a work-related accident during the course of her employment with the City as a procurement supervisor. As a result of her injuries, she developed a permanent disability that prevented her from returning to work. In October 2005, in the aftermath of Hurricane Katrina, Ms. Bates, along with about three thousand other City employees, was laid off.

From February 22, 1999 through February 22, 2009, the City paid Ms. Bates workers' compensation benefits. On April 20, 2009, Ms. Bates filed a disputed claim for compensation with the Louisiana Office of Workers' Compensation; she claimed that there was a dispute regarding her disability status and the February 22, 2009 termination of her indemnity benefits. On December 30, 2009, Ms. Bates settled her workers' compensation claim for a total amount of $41,500.00. The settlement agreement expressly indicated that $8,300.00 of the total amount was for Ms. Bates' attorneys' fee award. On January 5, 2010, the Workers' Compensation Judge approved the settlement agreement.² The judgment approving the settlement stated that Ms. Bates “reserve[d] to herself the right to seek and enforce any retirement benefits that she may be entitled from the City of New Orleans or the Municipal Employees' Retirement System.”

On October 12, 2010, Ms. Bates filed a Petition for Breach of Contract and Damages against the City and NOMERS. In her petition, she averred that she was vested and eligible for accidental disability retirement benefits under the City's retirement system as a result of the February 22, 1999 work-related injury she sustained. She further averred that her benefits claim was improperly denied as not timely filed during her employment and that she was entitled by the contract and the law to receive those benefits.

Both the City and NOMERS answered the suit. In their answers, they both included the following affirmative defense: “a credit and/or setoff from any sums paid to or on behalf of petitioners by defendantsby any other insurer, or by any person or entity, specifically pleading extinguishment of same or all of any obligation which may be found due petitioners to the full extent of any such payments.”

On September 24, 2012, a bench trial was held; and the trial court took the matter under advisement. On October 31, 2012, the trial court rendered judgment in Ms. Bates' favor, ruling:

IT IS ADJUDICATED, ORDERED AND DECREED the Plaintiff is entitled to receive disability retirement benefits from the Municipal Employees' Retirement System from October 12, 2009, through present and continuing as allowed by law.

Neither a motion for new trial, nor an appeal was taken from this judgment.

In response to the October 31, 2012 judgment, on January 8, 2013, Jesse Evans, Jr., Director of the City of New Orleans Employees' Retirement System, sent a letter to Ms. Bates setting forth the calculation of her monthly retirement benefits and the time line for payment of the benefits; his letter stated:

We have estimated your monthly retirement benefits to be nine hundred twenty-five dollars ($925.00). In addition to the judgment, we must also comply with Chapter 114 Section 226 of the New Orleans Code ³ ... which requires that accidental disability retirement benefits be offset against worker's compensation settlements received by the retiree. Based upon your worker's compensation settlement payment of forty-one thousand dollars ($41,500.00), we have calculated the offset period to be 44.864 months. Therefore, your estimated monthly benefit of nine hundred twenty-five dollars ($925.00) will commence effective July 2013.

In response to Mr. Evans' letter, on January 10, 2013, Ms. Bates' attorney sent two faxes to two different recipients. First, he sent the following fax to Mr. Evans:

I have just received a copy of Mr. Evans' letter to my client, Mary Bates, regarding the offset amount taken on the gross amount of her workers' compensation settlement. However, $8,300.00 of that settlement was for attorney fees and cost as approved by the court. The litigation cost which includes attorney fees cannot be used as a credit toward her disability retirement benefits that the City owes; and only $33,200.00 which is the net amount Ms. Bates received. I ask you to immediately correct and adjust your calculations; and then send a follow-up letter to Ms. Bates and my office with the correct figures and start date.

Second, Ms. Bates' attorney sent the following fax to the City's attorney:

Attached is a copy of a letter I just received from Mr. Evans and my response to his.... [T]he City had requested in it[s] affirmative defense the right to offset or take credit for workers compensation benefits; however, the court did not grant that relief to the City. Therefore, it is my position that the Retirement System was denied that relief and no offset should be allowed. We may be willing to resolve the issue by a compromise; but if there is no attempt to do so, then I will be filing a pleading with the court to hold the City and the Retirement System in Contempt of Court and seek to enforce the awarded retirement benefit without any offset or credit.

On February 22, 2013, Ms. Bates filed three motions: a Motion for Assessment of Costs; a Motion to Enforce the October 31, 2012 Judgment; and a Motion to Hold Defendants in Contempt. On April 12, 2013, a hearing was held on the motions. At the hearing, Ms. Bates' counsel withdrew the Motion to Hold Defendants in Contempt. On April 26, 2013, the trial court rendered judgment granting Ms. Bates' Motion to Enforce the October 31, 2012 Judgment and her Motion for Assessment of Costs. In its judgment, the trial court stated that its October 31, 2012 judgment was “now final and enforceable.” The trial court also made the following rulings:

IT IS ORDERED that the Defendants, the City of New Orleans and New Orleans Employees' Retirement System pay Plaintiff disability retirement benefits from the Municipal Employees' Retirement System from October 12, 2009, through present and continuing as allowed by law without any credit or offset.

IT IS FURTHER ORDERED that the Defendants, the City of New Orleans and New Orleans Employees' Retirement System pay Plaintiff's cost in the amount of $484.90; and Defendants to pay all outstanding costs for this suit including all costs associated with these motions.

IT IS FURTHER ORDERED that although the Plaintiff has withdrawn her Motion to hold the defendants in contempt at this time, the court hereby reserves to the Plaintiff the right to re-urge her Motion for Contempt if the defendants fail to comply with the orders of this court.

Thereafter, Ms. Bates filed a second Motion to Hold the Defendants in Contempt; and the City and NOMERS filed a suspensive appeal from the April 26, 2013 judgment.

On June 10, 2013, the City and NOMERS filed an Expedited Motion and Order to Stay Proceedings. In their motion, they pointed out that they had filed a suspensive appeal from the trial court's April 26, 2013 judgment. They further pointed out that they had been advised by Ms. Bates' attorney that he intended to go forward with the hearing scheduled for June 21, 2013 on the second Motion to Hold the Defendants in Contempt, despite the City's and NOMERS' pending suspensive appeal. They requested that the trial court stay the proceeding pending a decision by this court on the suspensive appeal.

On June 11, 2013, the trial court granted the Expedited Motion and Order to Stay Proceedings, issuing the following order:

IT IS ... ORDERED that proceedings in this matter are stayed and that the hearing on plaintiff's Motion to Hold Defendants...