Ouellette v. Contributory Ret. Appeal Bd.

86 Mass.App.Ct. 396

17 N.E.3d 421

Jacqueline OUELLETTE

v.CONTRIBUTORY RETIREMENT APPEAL BOARD & others.¹

No. 13–P–291.

Appeals Court of Massachusetts, Suffolk.

Argued Dec. 9, 2013.

Decided Sept. 30, 2014.

John M. Becker for the plaintiff.

Kirk G. Hanson, Assistant Attorney General, for Contributory Retirement Appeal Board & another.

Present: GRAINGER, BROWN, & CARHART, JJ.

Opinion

BROWN, J.

At issue in this appeal is whether the Contributory Retirement Appeal Board (CRAB) properly concluded that the accidental disability retirement allowance of Jacqueline Ouellette was subject to the statutory cap set forth in G.L. c. 32, § 7(2)(a )(ii).

Background. Ouellette worked for the city of Haverhill as a police officer from January, 1981, until December 5, 2003. On March 3, 2004, the Public Employee Retirement Administration Commission (PERAC) approved Ouellette's application, submitted through the Haverhill retirement board (board), for a voluntary

superannuation (regular) retirement, effective December 31, 2003. See G.L. c. 32, § 5.

On August 14, 2005, the plaintiff applied for an accidental disability retirement allowance, claiming posttraumatic stress disorder stemming from two incidents that occurred in November, 2003. After two medical panel reviews, PERAC unanimously certified that Ouellette satisfied all the statutory criteria for accidental disability retirement.² See G.L. c. 32, § 7(1).

On February 27, 2008, upon granting Ouellette's request for accidental disability retirement, effective February 14, 2005, PERAC imposed, pursuant to G.L. c. 32, § 7(2)(a )(ii), a seventy-five percent cap on her disability retirement allowance. General Laws c. 32, § 7(2)(a )(ii), as appearing in St. 1987, c. 697, § 33, provides in pertinent part that “for any employee who was not a member in service on or before January [1, 1988,] or who has not been continuously a member in service since that date, the total yearly amount ... as determined in accordance with the provisions of clause (i) shall not exceed seventy-five percent of the annual rate of regular compensation as determined in this paragraph....” PERAC reasoned that the plaintiff was not a member in service continuously until the effective date of her disability retirement allowance, because she became a “member inactive” on December 31, 2003, the date of her superannuation retirement.³

Ouellette appealed PERAC's refusal to lift the cap to CRAB.⁴ See G.L. c. 32, § 16(4). An administrative magistrate of the division of administrative law appeals (DALA) affirmed PERAC's decision.⁵ Following Ouellette's submission of an objection, CRAB adopted the magistrate's findings and issued a final decision affirming PERAC's imposition of the cap. On review, a judge of the Superior Court affirmed CRAB's decision. This appeal ensued.

Discussion. The case turns on the meaning of the provision in § 7(2)(a ) (ii), “any employee who was not a member in service on or before [January 1, 1988,] or who has not been continuously a member in service since that date.” PERAC interprets the provision as requiring that the employee be a “member in service” continuously until the effective date of her accidental disability retirement. The plaintiff contends that because she was continuously a member in service until her injury the cap does not apply.

General Laws c. 32, § 7, governs the conditions for an accidental retirement allowance and the amount awarded. Section (7)(1) controls eligibility. Section 7(2), on the other hand, governs the amount that the member can receive once the member has met the conditions set forth in § 7(1). Section 7(2) also limits when the accidental disability retirement allowance can take effect (effective date).

Pursuant to the first paragraph of G.L. c. 32, § 7(2), a member's disability allowance becomes effective on the latest of three possible dates: (1) the date of the injury or the hazard undergone, (2) the calendar date falling six months prior to the date of the submission of the written application for disability retirement, or (3) the date for which the member last received regular compensation.⁶ No challenge is made to CRAB's determination that the effective date of Ouellette's accidental disability retirement was February 14, 2005.

Section 7(2)(a ), sets out the components of the allowance that

the member receives as of the effective date of the retirement. An accidental disability allowance consists primarily of an annuity and a pension, with provision for additional upward adjustments not applicable here. See G.L. c. 32, § 7(2)(a )(i)-(iii). The normal annual allowance is the sum of “(i) [a] yearly amount of annuity equal to the yearly amount of the regular life annuity specified in clause (i) of Option (a) of subdivision (2) of section twelve ... [and] (ii) [a] yearly amount of pension equal to seventy-two per cent of the annual rate of his regular compensation on the date such injury was sustained or such hazard was undergone, or equal to seventy-two per cent of the average annual rate of his regular compensation for the twelve-month period for which he last received regular compensation immediately preceding the date his retirement allowance becomes effective, whichever is greater ....” G.L. c. 32, § 7(2)(a )(i)-(ii). These provisions were contained in the version of § 7(2)(a )(i) & (ii), as amended through St. 1970, c. 644, § 1. In 1987, the Legislature added after the language just quoted from 7(2)(a )(ii), additional language capping that sum at seventy-five percent of the annual rate of regular compensation for “any employee who was not a member in service on or before January [1, 1988,] or who has not been continuously a member in service since that date ” (emphasis supplied), with the added proviso that no individual who was a member in service on January 1, 1988, whose allowance is limited by the seventy-five percent cap shall receive an amount of pension that is less than seventy-two percent of that individual's regular compensation on January 1, 1988. G.L. c. 32, § 7(2)(a )(ii), as appearing in St. 1987, c. 697, § 33.

All parties agree that the starting date of the continuous service requirement is January 1, 1988; however, they do not agree on the ending date. CRAB read the requirement language to run from January 1, 1988, until the effective date of Ouellette's accidental disability retirement. CRAB found that when Ouellette began receiving her superannuation retirement allowance in December, 2003, she became a member inactive. CRAB concluded that as a result Ouellette was not a member in service continuously from January 1, 1988, through February 14, 2005, the effective date of her accidental disability retirement, and therefore was not entitled to avoid the limitation on her allowance.

“We review CRAB's decision under a deferential standard and will reverse only if its decision was based on an erroneous interpretation of law or is unsupported by substantial evidence.”

Foresta v. Contributory Retirement Appeal Bd., 453 Mass. 669, 676, 904 N.E.2d 755 (2009). See G.L. c. 30A, § 14(7). Accordingly, we give substantial deference to CRAB's interpretation of any ambiguous statutory text, see Souza v. Registrar of Motor Vehicles, 462 Mass. 227, 228–229, 967 N.E.2d 1095 (2012), “unless [the] statute unambiguously bars [its] approach.” Goldberg v. Board of Health of Granby, 444 Mass. 627, 633, 830 N.E.2d 207 (2005). On the other hand, no judicial deference at all is given to an erroneous interpretation of a statute. See Herrick v. Essex Regional Retirement Bd., 77 Mass.App.Ct. 645, 647–648, 933 N.E.2d 666 (2010), S.C., 465 Mass. 801, 992 N.E.2d 250 (2013).

We deal here with a claim of legal error.⁷ We conclude that CRAB's interpretation of the statute was reasonable and thus did not constitute an error of law. The statutory language was susceptible of multiple interpretations. Faced with an ambiguity about which end date the Legislature had in mind for purposes of the continuous service requirement, CRAB logically looked to the surrounding text for meaning. See Franklin Office Park Realty Corp. v. Commissioner of Dept. of Envtl. Protection, 466 Mass. 454, 462, 995 N.E.2d 785 (2013) (“Words grouped together in a statute must be read in harmony ...”). As with the relationship between the body paragraphs of a unified essay and a thesis statement in an introductory paragraph, CRAB could properly have concluded the end date related back to the effective date. The overall structure of § 7(2) and the use of the effective date to set the relevant time frame in other provisions of that statute supported CRAB's interpretation.⁸ Moreover, CRAB's selection of the latest possible date furthered the obvious cost containment purpose of the cap.⁹ See id. at 461, 995 N.E.2d 785. While it is possible to construe the statute in the manner urged by Ouellette, who maintains that the date of the injury should always be the operative end date, CRAB's choice between plausible interpretations cannot correctly be said to be wrong.

Nothing in the case law or G.L. c. 32 required CRAB to apply the date of injury as the operative date. It is well-settled that the member must have been in service on the date of the disabling accident (vis a vis the date of the application) in order to be eligible for accidental disability retirement. See State Retirement Bd. v. Contributory Retirement Appeal Bd., 12 Mass.App.Ct. 306, 308, 423 N.E.2d 1046 (1981) (Olson case); Leal v. Contributory Retirement Appeal Bd., 42 Mass.App.Ct. 330, 332, 677 N.E.2d 238 (1997). These cases are premised on the legislative purpose expressed in G.L. c. 32, §§ 3(1)(a )(ii) & 3(1)(c ),¹⁰ to preserve for members the rights, privileges, and potential benefits for which they qualified during their years of public employment. See Gannon v. Contributory Retirement Appeal Bd., 338 Mass. 628, 631–633, 156 N.E.2d 654 (1959) ; Boston Retirement Bd. v. McCormick, 345 Mass. 692, 695–696, 189 N.E.2d 204 (1963) ; Leal v....