vs.
Respondent.
) Case No. 04-4157
This cause came on for formal hearing before Robert S. Cohen, Administrative Law Judge with the Division of Administrative Hearings, on April 14, 2005, in Jacksonville, Florida.
For Petitioner: Robert D. Klausner, Esquire
Klausner & Kaufman, P.A. 10059 Northwest 1st Court Plantation, Florida 33324
For Respondent: Robert B. Button, Esquire
The issue is whether payment of Petitioner's retirement benefits should have commenced after the filing of an application to retire with the Division of Retirement, with an
effective date of April 1, 2004, or be retroactively changed to the date of his termination of employment, July 1, 2003.
Petitioner, Nathaniel Glover, Jr., requested Respondent to retroactively change his effective retirement date, on which payment of benefits would commence, from April 1, 2004, to July 1, 2003. Such a change would result in an additional nine months of benefit payments from the Florida Retirement Trust Fund. By letter dated May 27, 2004, Respondent denied Petitioner's request to change the date on which payment of his benefits would begin. Petitioner timely requested a formal administrative hearing to contest Respondent's denial. The
matter was forwarded to the Division of Administrative Hearings, and was heard before Robert S. Cohen, the Administrative Law Judge assigned to the matter. At the hearing, Petitioner testified on his own behalf, and called John Keane and George Dandelake as witnesses. Petitioner offered 25 exhibits, all of which were admitted into evidence. Respondent offered the testimony of Andy Snuggs, and offered three exhibits, all of which were admitted into evidence. The parties filed six joint exhibits, all of which were admitted. At the conclusion of the hearing, Petitioner and Respondent agreed to file proposed recommended orders by June 16, 2005. A Transcript was filed on April 27, 2005. Respondent filed its Proposed Recommended Order
on June 15, 2005, and Petitioner filed his on June 16, 2005. The Proposed Recommended Orders, the testimony, and exhibits have all been considered in issuing this Recommended Order.
References to statutes are to Florida Statutes (2004) unless otherwise noted.
On July 19, 1995, Petitioner applied for membership in the Special Risk Division of the Elected Officers' Class of the Florida Retirement System ("FRS").
On August 14, 1995, Respondent sent Petitioner a letter admitting him into FRS.
On September 6, 1995, Sarabeth Snuggs, Chief of the Bureau of Enrollment and Contributions for Respondent, sent Petitioner a letter revoking his membership in FRS.
On December 17, 1996, Petitioner wrote to Sarabeth Snuggs responding to Respondent's decision to revoke his membership in FRS. Petitioner cited Section 121.052(2)(d), Florida Statutes, which provides that membership in FRS includes "any constitutional county elected officer assuming office after July 1, 1981, including any sheriff."
The Consolidated City of Jacksonville was created by the Florida Legislature with the enactment of Chapter 67-1320, Laws of Florida. Section 1.01 of the Jacksonville Charter provides that the county government of Duval County and the
municipal government of the City of Jacksonville are consolidated into a single body politic. The Charter further provides that the consolidated government succeeds to and possesses all of the properties of the former government.
After being denied membership in FRS, Petitioner and other members of the consolidated government and its instrumentalities worked diligently to convince Respondent to admit Petitioner into FRS.
During Petitioner's attempts to be included in FRS, Respondent repeatedly took the position that Duval County did not exist as a county agency.
In a letter to Petitioner dated January 15, 1997, Ms. Snuggs wrote that the consolidated Duval County government "chose to consolidate as a 'city' government."
Mr. Keane worked with the Duval County Legislative Delegation to amend Chapter 121 to specifically clarify the fact that the Duval County Sheriff and Clerk of Court are constitutional officers entitled to participate in FRS. In 2002, the Florida Legislature adopted language to clarify the Duval County Sheriff and Clerk of Court's status with respect to FRS.
In a letter dated June 24, 2002, Petitioner thanked Ms. Snuggs for recognizing his right to elect membership in FRS. Petitioner observed that, since he was in the last year of his
second term as Sheriff (Duval County allows only two consecutive terms), he wanted confirmation of his "right to connect the previous seven (7) years of service as Sheriff." The June 24, 2002, letter also asked for "guidance" from Respondent.
The purpose of the June 24, 2002, letter was for Petitioner to learn how Respondent intended to treat his first six years of service. Petitioner sought to avoid any problems since his retirement date was rapidly approaching.
On October 10, 2002, Petitioner and Mr. George Dandelake, the Chief of the Budget and Management Division of the Sheriff's Office, wrote to Ms. Snuggs requesting a calculation of the amount of employer contributions required on Petitioner's behalf. The October 10 letter also requested that Respondent "identify what documents are required, in addition to the contribution amount which will be paid by the City, that must be supplied to the Florida Retirement System."
Petitioner re-applied for membership in FRS, which was granted on June 1, 2002, after the effective date of the legislation designed to specifically admit the Duval County Sheriff and Clerk of Court into FRS.
On June 18, 2003, twelve days before the expiration of his term of office, still not having received confirmation of the status of his prior service, Petitioner sent a letter to Ms. Snuggs advising that FRS had not recognized his service from
1995 through 2002. Petitioner again stated in the letter that he was terminating his position as Sheriff on June 30, 2003.
Less than a week prior to the termination of his term, Petitioner received two "Statement[s] of Account" dated June 24, 2003, indicating that "you have until retirement to pay the amount due on your account." The statements further indicated that "when you become vested for monthly benefits, we will provide you an estimate of benefits with and without this service."
According to the first Statement of Account, Petitioner was entitled to purchase prior service at the 1.6 percent multiplier rate for the FRS regular class.
According to the second Statement of Account, Petitioner was entitled to purchase prior service at the 2.0 percent multiplier rate for the FRS special risk class.
Neither Statement of Account was correct, as both failed to permit Petitioner to purchase service at the 3.0 percent rate for special risk, despite the fact that Petitioner had served a continuous and uninterrupted term as Sheriff.
The Statement of Account did not advise Petitioner that he must submit a separate retirement application,
Form FR-11, in order to preserve his retirement date.
The statement did advise Petitioner that interest would be assessed at a rate of 6.5 percent. This warning appeared in bold face on the Statement of Account.
The June 24, 2003, statements were the first time that Petitioner was supplied with the amount due to purchase service credit. Since neither statement applied the correct multiplier rate (3.0 percent) for all eight years of Petitioner's service as Sheriff, neither statement was correct.
Recognizing that only six days remained prior to the expiration of Petitioner's term as Sheriff, Mr. Keane advised Petitioner to submit payment to Respondent on an expedited basis.
After receiving the June 24, 2003, Statements of Account, Petitioner prepared a letter dated June 26, 2003, to Cal Ray, the Director of the Department of Administration and Finance for the Consolidated City of Jacksonville. In this letter, Petitioner requested an employer contribution in the amount of $163,554.32 to purchase his prior service. Petitioner further requested an expedited preparation of the check to ensure delivery to Respondent by July 1, 2003.
The letter to Mr. Ray requested payment of the amounts that would have been periodically contributed by the City of Jacksonville if Respondent had been acknowledged as a participant in FRS in 1995.
On June 27, 2003, three days prior to the expiration of his term of office, Petitioner drove from Jacksonville to Tallahassee to meet with Respondent's representatives, including Ms. Snuggs, regarding Petitioner's retirement. Mr. Dandelake accompanied Petitioner on this trip.
At the June 27, 2003, meeting, Petitioner personally delivered a check to Respondent in the amount of $163,554.32. Respondent accepted the check and issued a written receipt signed by Sarabeth Snuggs.
Petitioner was never told during the June 27, 2003, meeting with Respondent that he would forfeit benefits if he failed to complete an application.
Respondent knew that Petitioner was leaving office on June 30, 2003.
Respondent never discussed the filing of an application for retirement benefits at any time during the course of its conversations and correspondence with Petitioner.
Petitioner was never told by Respondent to complete any forms to protect his rights to the 2.0 percent multiplier during the pendency of his dispute with Respondent. Petitioner was never provided any handbook, notice, statutes, or rules indicating he would forfeit benefits under any circumstances.
When Petitioner left the June 27, 2003, meeting, both he and Mr. Dandelake understood that he was still engaged in a dispute with Respondent over his entitlement to the 3.0 percent multiplier.
Petitioner knew that he was required to file an application in order to receive retirement benefits.
Petitioner testified that if he had left the June 27 meeting with any indication that he would forfeit benefits by not filing an application, he would have filed something, with advice of counsel, to preserve his rights.
Petitioner received an Estimate of Benefits via fax from Respondent on June 27, 2003, reflecting an annual benefit of $23,105.90. This statement valued 6.92 years of Petitioner's uninterrupted special risk service as Sheriff using the 2.0 percent multiplier, and 1.08 years of service as Sheriff using the 3.0 percent multiplier.
The June 27, 2003, statement lists Petitioner's retirement date as July 1, 2003. The estimate does not warn Petitioner that he must do anything in order to preserve his July 2003 retirement date. The estimate states only that it is subject to "final verification of all factors."
Petitioner's term of office as elected Sheriff ended on June 30, 2003. Petitioner's employment terminated when his term expired on that date.
Respondent was aware of the dates of the expiration of Petitioner's term of office as well as his employment termination date.
When Petitioner's employment terminated on June 30, 2003, it was unclear whether he would be credited with the 3.0 percent multiplier for his eight years of special risk service.
Petitioner was not notified by Respondent prior to the expiration of his term as Sheriff on June 30, 2003, that he needed to submit a retirement application.
The first time Petitioner was advised by Respondent of the need to file an application for retirement benefits was in the comment section of the Estimate of Retirement Benefits provided to him by letter dated March 4, 2004. The warning was printed in bold face type.
The Estimate of Retirement Benefits dated June 27, 2003, did not include the bold face warning to file an application.
Respondent was not provided with a Division of Retirement publication entitled "Preparing to Retire" prior to his leaving service on June 30, 2003. In fact, the copy of the publication offered into evidence by Respondent is dated "July 2003," subsequent to Petitioner's retirement.
As the only member of FRS in his office in Jacksonville, Petitioner had no staff or employees trained in FRS or Florida retirement benefits.
Petitioner was provided with a "Preparing to Retire" booklet in March 2004.
On November 3, 2003, Florida Attorney General Opinion 2003-46 confirmed that Petitioner, as the elected Sheriff, was eligible for membership in the Elected Officer's Class of the Florida Retirement System.
On December 31, 2003, and on January 16, 2004, Petitioner's counsel attempted to obtain clarification from Respondent regarding Petitioner's retirement benefits.
The December 31, 2003, letter noted that the "extraordinary delay" in resolving the issue of Petitioner's benefits was at no time due to fault on the part of Petitioner. Respondent never refuted or disputed this statement.
By letter dated March 4, 2004, Petitioner was finally advised by Respondent that he was entitled to be credited with the higher 3.0 percent multiplier for all eight years of his service as Sheriff.
Petitioner noted that the March 4, 2004, Statement of Account, while properly applying the 3.0 percent multiplier, now had changed Petitioner's retirement date to April 2004 from the previous estimates showing a retirement date of July 2003.
The March 4, 2004, statement included the bold face notice to Petitioner that he must file an application for retirement benefits. No prior notices or correspondence from Respondent had informed Petitioner that he must file Form FR-11 in order to retain his retirement date of July 1, 2003.
After formally being notified that he would receive the 3.0 percent multiplier for all eight of his years of service as Sheriff, and after having received the notice that he must file Form FR-11, Petitioner submitted the form in April 2004.
Respondent is a fiduciary charged with acting in the best interest of participants in FRS.
Andy Snuggs, who travels around the state educating employers and employees in FRS, acknowledged that Petitioner was not responsible for the delay by Respondent in recognizing Petitioner's entitlement to the 3.0 percent multiplier.
Mr. Snuggs acknowledged that he does not tell employees that they will forfeit benefits if they delay the filing of their applications.
Petitioner received his first retirement check in May 2004 which was based upon the benefit established in
March 2004 of $32,624.58 annually, not the $23,105.90 previously established by Respondent in June 2003.
Petitioner has received no retroactive benefits for the period of July 1, 2003, through April 30, 2004.
In a letter dated May 6, 2004, Petitioner stated that his acceptance of the first retirement check was not to be construed by Respondent of a waiver of his rights to retroactive benefits from July 1, 2003, forward.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter of and the parties to this proceeding. §§ 120.569 and 120.57(1), Fla. Stat.
The burden of proof in an administrative proceeding is on the party asserting the affirmative of an issue. Department
of Transportation v. J.W.C., Inc., 396 So. 2d 778 (Fla. 1st DCA 1981). Accordingly, Petitioner has the burden in this proceeding to demonstrate entitlement to the effective retirement date of July 1, 2003, which would result in nine additional months of benefits.
Section 121.091, Florida Statutes, provides that "benefits may not be paid under this section unless the member has terminated employment and a proper application has been filed in the manner prescribed by the department."
Florida Administrative Code Rule 60S-4.0035, in pertinent part, provides:
It shall be the responsibility of the member, or the beneficiary in the event of the member's death, to make proper application to the Division for retirement benefits.
* * *
The Division shall establish the member's effective retirement date as follows:
For a member who makes application for a normal or early retirement benefit as provided in Florida Administrative Code Rule 60S-4.004 or 4.005, the effective retirement date shall be the first day of the month following the month in which the member's termination occurs, provided the Division receives such member's application for retirement no later than 30 calendar days after such termination. If a member fails to apply for retirement within 30 calendar days after termination or if the member chooses to defer his retirement to a later date, the effective retirement date shall be the first day of the month following the month in which the Division receives the member's application, or the first day of a later month specified by the member.
Section 121.052(2)(d), Florida Statutes, provides, in pertinent part, the following with respect to membership in the "Elected Officers' Class" of employees:
Any constitutional county elected officer assuming office on or after July 1, 1981, including any sheriff, tax collector, property appraiser, supervisor of elections, clerk of the circuit court, county commissioner, school board member, or elected school board superintendent, or any elected officer of any entity with countywide jurisdiction assuming office on or after July 1, 1981, who, pursuant to general or special law, exercises powers and duties that, but for such general or special law, would be exercised by any of the constitutional county elected officers set forth in this paragraph, including the sheriff and clerk of the circuit court in a
consolidated government with countywide jurisdiction unless such sheriff or clerk elected to continue to participate in a local retirement system.
Petitioner, with the acquiescence of Respondent, requested an Attorney General's Opinion concerning the applicability of Section 121.052(2)(d), Florida Statutes, to his position as Sheriff of Duval County. Opinion No. 2003-46, issued by Attorney General Charlie Crist on November 3, 2003, points out the plain language of the statute as it relates to Petitioner's position as Sheriff of Duval County, a "consolidated government with countywide jurisdiction." Section 121.052(2)(d), Florida Statutes, was amended to unequivocally include the elected officers of the consolidated Duval County/Jacksonville government in the Elected Officers' Class. Therefore, Respondent was placed on notice of Petitioner's eligibility for inclusion in the class, and use of the 3.0 percent multiplier no later than mid-2002. The Attorney General's Opinion merely reiterated what Respondent should have already known: Sheriff Glover was a member of FRS entitled to the 3.0 percent multiplier well before the time of his retirement.
Respondent failed at hearing to provide any reasonable explanation for its inability to accurately calculate Petitioner's retirement benefits using the 3.0 percent
multiplier applied to the eight years of his term-limited office as Sheriff of Duval County. The issue remaining in this case is whether Petitioner is entitled to recover his lost benefits for the first nine months of his retirement.
Without question, Respondent knew for a lengthy period of time prior to the expiration of Petitioner's term as Sheriff that he intended to retire at the end of his term. Just as clearly, Petitioner neither had the benefit of a human resources or personnel officer at the City of Jacksonville well versed in FRS and state retirement procedures nor had the benefit of Respondent's employee, Mr. Snuggs, visiting Jacksonville to educate him and other participants in FRS on the fine points of the application and retirement process. Petitioner was left to fend for himself, which he admirably did with the aid of legal counsel and experienced city personnel. He was even placed in the position of having to drive to Tallahassee at the eleventh hour to ensure the City's contribution to his retirement was made on time. The evidence supports the fact that Petitioner never even received the employee's retirement manual until nearly a year after his employment terminated.
The Division of Administrative Hearings has no equitable jurisdiction to award equitable relief. Such jurisdiction is vested in the circuit courts of Florida pursuant to Section 26.012(2)(c), Florida Statutes. However, the courts
have noted that the administrative process in this state routinely handles cases in which the parties have introduced estoppel issues. Occidental Chemical Agricultural Products, Inc. v. Dept. of Environmental Protection, 501 So. 2d 674 (Fla. 1st DCA 1987). See, e.g., Kuge v. Division of Retirement, 449 So. 2d 389 (Fla. 3d DCA 1984); Fraga v. Dept. of Health and
Rehabilitative Services, 464 So. 2d 144 (Fla. 3d DCA 1985); and Salz v. Division of Retirement, 432 So. 2d 1376 (Fla. 3d DCA 1983). But, the courts have recognized that equitable estoppel will be applied against the state "only in rare instances and under exceptional circumstances." Dept. of Revenue v. Anderson,
403 So. 2d 397, 400 (Fla. 1981), citing North American Co. v.
Green, 120 So. 2d 603 (Fla. 1959). Another general rule is that the state cannot be estopped through mistaken statements of the law. Dept. of Revenue v. Hobbs, 368 So. 2d 367 (Fla. 1st DCA), appeal dismissed, 378 So. 2d 345 (Fla. 1979); Austin v. Austin,
350 So. 2d 102 (Fla. 1st DCA 1977), cert. denied, 357 So. 2d 184 (Fla. 1978).
The elements that must be established for the doctrine of equitable estoppel to apply against a governmental agency are set forth in Council Brothers Inc. v. City of Tallahassee, 634 So. 2d 264, 266 (Fla. 1st DCA 1994):
The elements which must be present for application of estoppel are: (1) a representation as to a material fact that is
contrary to a later-asserted position;
reliance on that representation; and
a change in position detrimental to the party claiming estoppel, caused by the representation and reliance thereon." Dept. of Revenue v. Anderson, 403 So. 2d 397, 400 (Fla. 1981).
* * *
One seeking to invoke the doctrine of estoppel against the government first must establish the usual elements of estoppel, and then must demonstrate the existence of affirmative conduct by the government which goes beyond mere negligence, must show that the government conduct will cause serious injustice, and must show that the application of estoppel will not unduly harm the public interest. Alachua County v.
Cheshire, 603 So. 2d 1334, 1337 (Fla. 1st
DCA 1992).
The difficult determination to make in this matter is whether Petitioner relied upon a misrepresentation by Respondent as to a material fact that is contrary to a later asserted position. Here, Respondent asserted that Petitioner was entitled only to the 2.0 percent multiplier for calculating his retirement benefits when by statute clarified no later than 2002, Petitioner was without question a member of the Elected Officer's Class and entitled to the 3.0 percent multiplier. Respondent appeared unable to understand its own statute as it applied to Petitioner's eligibility to receive the higher multiplier. This is a mistake in law, not material fact. Petitioner disputed the 2.0 percent conclusion both before and
during his meeting with Respondent on June 27, 2003, just days before his retirement. Respondent did not tell Petitioner that he must file his application for retirement benefits even though he disputed the multiplier, yet Petitioner candidly testified that he believed he was required to file an application in order to secure his retirement benefits. His fear, of course, was that if he filed his application while the issue of the multiplier was still unresolved, he might waive his right to continue to fight for the significantly higher benefit. This acknowledgment by Petitioner that he knew an application must be filed tends to negate his reliance on the action or inaction of Respondent as to notifying him of his obligations. Left unanswered is why Respondent failed to inform Petitioner in
June 2003 on the Estimate of Benefits form that he must file an application, yet informed him in bold faced type on the same form in March 2004 that he must file his application immediately in order to begin receiving benefits in April 2004. This sounds as though the issue were unsettled in June 2003 and remained unsettled until March 2004.
The final issue of law is whether the doctrine of equitable tolling should apply here. While equitable tolling generally is not employed in cases involving the mere failure to provide any information to an employee, Hickey v. Division of Retirement, Case No. 98-3895 (DOAH March 9, 1999), adopted in
toto by Final Order 5/10/99) and Behnke v. Division of Retirement, Case No. 00-0697 (DOAH August 14, 2000), the Florida Supreme Court held in Machules v. Dept. of Administration, 523 So. 2d 1132 (1988), both that the principles of equitable tolling are applicable to administrative cases and that the doctrine should apply when an applicant has been misled or lulled into inactivity by an agency, and has been diligent in seeking to protect his rights after discovering the error.
Here, Petitioner was lulled into inactivity by virtue of the fact that he continued to engage in debate and discussion with Respondent after his employment termination date of June 30, 2003, had passed. Not until the Attorney General was asked to weigh-in and the issuance of his Opinion clarifying the already- clear statute with respect to Petitioner's class of employment, as well as the issuance by Respondent of yet another Estimate of Benefits calculation to Petitioner in March 2004, was Petitioner in a position to apply for the retirement benefits to which he was justly entitled. Moreover, Petitioner was extremely diligent in seeking his appropriate benefits from Respondent.
For years he corresponded with Respondent to clarify the issues related to Jacksonville's status and his eligibility to participate in FRS. Petitioner personally drove to Tallahassee to deliver the City's payment of the employer contribution prior to his termination date. No evidence was produced at hearing
that would lead any reasonable person to believe that Petitioner intended to leave office and retire on any date other than
June 30, 2003. Once he was made aware of the proper calculation of his retirement benefits, Petitioner immediately filed his application for benefits. Even then, he was forced to write to Respondent to state that his acceptance of his first retirement check should in no way be construed as a waiver of his right to seek the nine months of retirement pay to which he felt entitled. Petitioner received no assistance from Respondent, either through pre-retirement education, or during the process Petitioner was forced to endure as his retirement loomed large on the horizon.
In light of the circumstances under which Petitioner, a career law enforcement officer, was forced to pursue with great fervor his earned retirement pay, he should be entitled to receive his full retirement benefits retroactive to July 1, 2003. This conclusion is supported by the testimony at hearing of both Petitioner, his colleagues who supported him during this difficult process, and by Respondent's representatives who should have been more helpful when dealing with a member of FRS in need of the agency's expertise and guidance.
RECOMMENDED that Petitioner be awarded retirement benefits at the rate of 3.0 percent per year for his eight years of Elected Officer's Class of service, retroactive to July 1, 2003.
DONE AND ENTERED this 21st day of July, 2005, in Tallahassee, Leon County, Florida.
ROBERT S. COHEN
Filed with the Clerk of the Division of Administrative Hearings this 21st day of July, 2005.
Robert D. Klausner, Esquire Klausner & Kaufman, P.A.
Robert B. Button, Esquire Department of Management Services 4050 Esplanade Way, Suite 160
15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.
