The Issue The issue presented is whether Petitioners are entitled to Option 2 continuing retirement benefits following the death of Linda Prince, a Florida Retirement System member.
Findings Of Fact Linda J. Prince was employed by the Florida Department of Law Enforcement (hereinafter "FDLE") and was a vested, regular class member of the Florida Retirement System (hereinafter "FRS"). After she was diagnosed with a serious health condition, she was able to continue as a full-time employee by participating in the Department's sick leave pool. By November 2008 her family understood that she was terminally ill. About that time, she began alternating staying at the home of her son Brian Prince and at the home of her daughter and son-in- law Wendy and Harrison T. Rivers. During the first week of November 2008, her son, daughter, and son-in-law began discussing whether she should retire rather than remaining in full-pay status. Harrison T. Rivers asked his father Harrison W. Rivers for advice since his father was a retired member of FRS. His father told him that Linda Prince should retire right away under Option 2 since that would guarantee a 10-year payout. One of the persons that Harrison T. Rivers contacted for advice referred him to Annie Lamb, a Personnel Services Specialist at FDLE. He remembers asking her about Option 2 and understood her to tell him that Option 2 required having a spouse or other dependents. She does not recall the conversation. When Harrison T. Rivers conveyed his understanding to Brian Prince, Brian requested that a meeting be set up at FDLE's Personnel Office. The two men met with Samantha Andrews, a different FDLE Personnel Services Specialist, near the end of 2008. All three persons attending the meeting recall that they discussed the sick leave pool, and the two men were assured that there were enough donations to the sick leave pool to cover Linda Prince's continuing need. The attendees at the meeting have different recollections of the other matters discussed. The two men believe they discussed Option 2 and that Samantha Andrews called across the hall to Annie Lamb who confirmed that Option 2 required a spouse. Lamb recalls Andrews asking her a question but does not remember what the question was. Andrews does not recall asking Lamb a question and further does not recall discussing the retirement options at the meeting. At the final hearing, Andrews admitted that she did not understand the differences among the four retirement options until after Linda Prince's death and that before then she thought that one had to be a spouse or a dependent child to be a beneficiary. Andrews' impression of the meeting is that Linda Prince's children wanted to be sure she remained in full- pay status through the sick leave pool to increase her income and keep her benefits available and at a reasonable cost. After this meeting, Linda Prince remained on full-pay employment status. As a result, she received (1) her full salary rather than a reduced retirement amount, (2) health insurance at a cost of $25 bi-weekly, and (3) a $44,000 life insurance policy at the cost of $2 bi-weekly. If she had retired, she would have had to pay nearly $500 a month for the health insurance and would have lost her $44,000 life insurance policy. Instead, she would have had the option of purchasing either a $10,000 or $2,500 life insurance policy for $29.65 or $7.41 a pay period, respectively. On January 10, 2009, Harrison W. Rivers was visiting at his son's home while Linda Prince was staying there. In a conversation with her, he was surprised to learn that she had not retired as he had strongly advised two months earlier. When he later questioned his son as to why she had not retired, his son told him because she did not have a spouse. Harrison W. Rivers told his son that that information was not correct. On January 20, 2009, Harrison W. Rivers met with his own financial advisor David A. Wengert and relayed the information his son had given him. Wengert agreed with Rivers that the information about a spouse or dependent child was not correct but checked with a contact he had at the Department of Corrections. That person confirmed that the spouse or dependent child requirement did not apply to Option 2 and faxed the necessary forms for retiring under Option 2 to Wengert who gave them to Rivers. Harrison W. Rivers gave the folder from Wengert containing the correct information and required forms to his son and told his son to retire Linda Prince immediately. His son subsequently called Brian Prince, gave him the correct information, and told him that Linda Prince should retire. Brian Prince agreed but was out of town at the time. On February 11, 2009, Harrison T. Rivers drove Annie Lamb from FDLE to where Linda Prince was staying. The forms were completed and signed, and Lamb notarized Linda Prince's signature. The forms provided for Linda Prince to take early retirement under Option 2 with Brian Prince and Wendy Rivers as her equal beneficiaries. The forms were filed with Respondent, the Department of Management Services, Division of Retirement, the same day. The forms she signed selected February 28, 2009, as Linda Prince's termination of employment date. A termination date of February 28, 2009, resulted in a March 1, 2009, retirement date. Linda Prince died on February 14, 2009. On that date, she was still in full-pay status since she had not terminated her employment and retired. Option 2 under the FRS system provides a reduced monthly benefit payable for the member's lifetime, but if the member dies within ten years after his or her retirement date, the designated beneficiary receives a monthly benefit in the same amount for the balance of the ten-year period, and then no further benefits are payable. Option 1 provides for monthly payments for the member's lifetime, and upon the member's death, no further monthly benefits are payable. It, therefore, pays no continuing benefits to a beneficiary. Options 3 and 4 provide for joint annuitants and reduced monthly benefits. Under Option 3, upon the member's death, the joint annuitant, who must be a spouse or a financial dependent, will receive a lifetime monthly benefit payment in the same amount, but there are limitations on the amount and length of those payments for a joint annuitant under 25 who is not a spouse. Option 4 provides an adjusted monthly benefit while the member and the joint annuitant are living, a further reduced monthly benefit after the death of either the member or the joint annuitant, with adjustments if the joint annuitant is under the age of 25 and not a spouse. No benefits are payable after both the member and the joint annuitant are deceased. Thus, only Options 3 and 4 require a spouse or financial dependent in order for continuing benefits to be paid after the member's death. Upon learning of her death, the Division of Retirement researched whether any benefits were due to Linda Prince or her beneficiaries. Since she had paid nothing into the FRS, there were no contributions to refund. Further, since she had not retired, no retirement benefits were payable to her or her beneficiaries. The Division also looked at the dates of birth of her beneficiaries to determine if a beneficiary would qualify as a joint annuitant, but both of her beneficiaries were over the age of 25. The only time that Linda Prince contacted the Division of Retirement was in 2002 when she sent an e-mail asking that her benefits be calculated as to what she would receive if she retired at age 62. The Division performed the calculations and sent her the information as to what her benefits would be under Options 1 and 2. Her file contains her e-mail, the benefits estimates sent to her, and a copy of an informational retirement brochure. Information on the FRS, including descriptions of the Options, has been available on the Division's website, in employee handbooks available from the Division, and was available in written form in FDLE's Personnel Office on the day that Brian Prince and Harrison T. Rivers met with Samantha Andrews. During that meeting, neither Brian Prince nor Harrison T. Rivers requested a copy of the employee handbook or any written materials describing the Options for retirement. Because of Petitioners' estoppel argument, the chronology in this case must be closely reviewed. At least until early November 2008, Linda Prince had made her decision to stay on full-pay status to receive her full salary and benefits rather than take early retirement. In early November, her son, daughter, and son-in-law became involved in that decision. In early November, her son-in-law understood an FDLE employee to say that Linda Prince needed a spouse or financial dependent to qualify for continuing retirement benefits, but his father, who was a retired member of FRS, told him that information was wrong and that Option 2 would provide a ten-year continuing benefit for her beneficiaries. No contact was made on her behalf with the Division of Retirement to ascertain which information was correct. On January 10, 2009, Harrison W. Rivers, upon learning that Linda Prince was still not retired, again told his son that she should be retired under Option 2 and that his son's understanding that she needed a spouse or financial dependent was wrong. Again, no contact was made with the Division of Retirement. On January 20, 2009, Harrison W. Rivers obtained the written information and required forms. Within a few days he gave the information and forms to his son and told him again to see to it that Linda Prince was retired immediately. Yet, the forms were not executed and filed with the Division of Retirement until February 11, 2009. Had Linda Prince or anyone on her behalf contacted the Division of Retirement to clarify which information was correct once they had conflicting information the first week of November 2008, she could have retired starting December 1. Had Linda Prince or anyone on her behalf submitted her application for retirement when Harrison W. Rivers provided the correct information and forms to use in January 2009, she could have retired then with a February 1 retirement date. Even though Petitioners offered evidence to show that they relied upon erroneous information conveyed by Harrison T. Rivers and even though they offered evidence that they received erroneous information from Samantha Andrews, it would have been clear to a reasonable person that such information conflicted with the information given by Harrison W. Rivers, who had gone through the process. Further, in January when Rivers gave them the correct written information and the forms to use, there was no basis for relying upon the erroneous information. If Petitioners had acted to clarify the previous conflicting information or had not delayed in having Linda Prince execute the forms when Rivers provided them, they would have retired her before her death and would have been entitled to continuing benefits. Whatever circumstances caused the further delay in the filing of Linda Prince's application for retirement and supporting documentation, the delay was not caused by the information, erroneous or not, provided by the FDLE employees. Accordingly, Linda Prince was still a full-time employee at the time of her death not as a result of erroneous information provided by FDLE employees as alleged by Petitioners, but as a result of delay in obtaining the easily- accessible correct information from the Division of Retirement and as a result of delay in acting on the correct information when it was provided to them. There are over 960 agencies, including state departments and local governments and school boards, which participate in the FRS. The employer and employee handbooks distributed to those agencies and their employees by the Division of Retirement clearly state that representatives of participating agencies are not the agents of the Division of Retirement but rather only act as a link between employees and the Division of Retirement.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding Petitioners ineligible for an Option 2 benefit from the FRS retirement account of Linda Prince. DONE AND ENTERED this 10th day of August, 2009, in Tallahassee, Leon County, Florida. S LINDA M. RIGOT Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 10th day of August, 2009. COPIES FURNISHED: Brian Prince 1063 Walden Road Tallahassee, Florida 32317 Harrison Rivers 4211 Camden Road Tallahassee, Florida 32303 Elizabeth Regina Stevens, Esquire Department of Management Services Office of the General Counsel 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32327 Sarabeth Snuggs, Director Division of Retirement Department of Management Services Post Office Box 9000 Tallahassee, Florida 32315-9000 John Brenneis, General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950
Findings Of Fact The Petitioner, Robert Gilmour, was employed by the Dade County School Board until July 2, 1984, when he terminated his employment effective June 15, 1984. Mr. Gilmour terminated his employment by placing a telephone call to his supervisor. At the time of the telephone call, Mr. Gilmour was out of the Miami area on vacation. Mr. Gilmour did not return from vacation until August 8, 1984. On August 9, 1984, Mr. Gilmour went to the Office of Personnel Retirement Section, of the Dade County School Board, where he executed an application for early retirement. Mr. Gilmour's application for retirement was received by the Benefits Calculation Section of the Division of Retirement on August 15, 1984, in Tallahassee, Florida. The Division of Retirement assigned to Mr. Gilmour an effective date of retirement of September 1, 1984, the first day of the month following the date on which the Division of Retirement received his application for retirement. In May, 1984, Mr. Gilmour, placed a telephone call to Louise Syrcle, an employee of the School Board in the Office of Personnel, Retirement Section. Mr. Gilmour was considering retirement and wanted to discuss the matter with Ms. Syrcle. At the time of the telephone call, Ms. Syrcle was on her vacation and then was subsequently on sick leave because of a broken back. Ms. Syrcle was absent from employment from April 23, 1984 until June 25, 1984. In the course of the telephone call, Mr. Gilmour was told of Ms. Syrcle's broken back and was told that appointments were being made only for those teachers who had already decided to retire. Because he had not yet made that decision, he did not make an appointment. Further Mr. Gilmour did not seek to speak with any other personnel in that office. Art Miles Ms. Syrcle's supervisor, and other personnel were available in the Dade County School Board's Office of Personnel to respond to retirement requests and they did process numerous retirement requests during Ms. Syrcle's absence. At no time did Mr. Gilmour seek, read or receive a copy of the Summary Plan Description brochure which was admitted as Respondent's Exhibit C. Additionally, at no time did Mr. Gilmour make inquiry of anyone at the Division of Retirement regarding his retirement options. Instead, Mr. Gilmour relied on information gleaned from casual conversations with colleagues, which information was not correct. At all time relevant hereto, the Division of Retirement has maintained a staff of counselors who are available to consult with members and agencies on matters concerning retirement, including deadlines for filing applications. As a result of Mr. Gilmour's July 2, 1984, telephone call, in which he terminated his employment, the Dade County School Board sent a certification of service and earnings, Form FT4A, on July 2, 1984. This form was received by the Division of Retirement on July 9, 1984. While this form may have indicated that Mr. Gilmour had terminated his employment with the Dade County School Board, no information contained in that form indicated his intent to retire. When Mr. Gilmour went to the Office of Personnel, Retirement Section, of the Dade County School Board on August 9, 1984, he first learned that the rules of the Division of Retirement required that the application for retirement be filed within 30 days of the termination date in order for the retiree to receive retirement benefits retroactive to the date of termination. Because Mr. Gilmour failed to file his application for retirement until August 15, 1984, he did not receive retirement benefits for the months of July and August, 1984.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Division of Retirement enter a Final Order denying Robert Gilmour retirement benefits for the months of July and August, 1984, and establishing Mr. Gilmour's effective date of retirement to be September 1, 1984, the first day of the month following his application for retirement. DONE and ENTERED this 17th day of May, 1985, in Tallahassee, Florida. DIANE K. KIESLING Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 17th day of May, 1985.
The Issue Whether Petitioner, Rina Richard DeMichael (“Petitioner”), the surviving spouse of David DeMichael, is entitled to change the Florida Retirement System (“FRS”) retirement benefits payment Option 1 selected by Mr. DeMichael.
Findings Of Fact Respondent is the state agency charged under chapter 121, Florida Statutes, with administering the FRS. In 1991, Mr. DeMichael began employment with the Broward County Sheriff’s Office (“BCSO”). Mr. DeMichael was a member of the FRS pension plan based on his employment with the BCSO as a deputy sheriff. Mr. DeMichael married Petitioner on November 19, 2011. On February 11, 2013, Mr. DeMichael retired from the BCSO. At that time, he signed the Florida Retirement System Pension Plan Application for Service Retirement form (“Application for Service Retirement Form”) designating Petitioner as his primary beneficiary. On February 11, 2013, Mr. DeMichael also signed the Florida Retirement System Pension Plan Option Selection for FRS Members form (Form FRS-110)(“Option Selection Form”). On the Option Selection Form, Mr. DeMichael was required to select one of four retirement benefit payment options. The Option Selection Form provided an explanation for each of the four options. Mr. DeMichael selected to receive an Option 1 retirement benefit by checking the line next to the Option 1 benefit payment option. Option 1 provides the maximum benefit for the life of the FRS member with no continuing benefit after the member’s death. On February 11, 2013, Petitioner signed the Spousal Acknowledgement Form (Form SA-1)(“Spousal Acknowledgement Form”) acknowledging that Mr. DeMichael “selected either Option 1 or 2.” The purpose of the Spousal Acknowledgement Form is to inform the spouse that he/she will not receive a lifetime benefit following the FRS member’s death. The Spousal Acknowledgement Form does not give a spouse control over which option the FRS member selects. That option selection decision is the sole choice of the member. The Spousal Acknowledgement Form provided an explanation of the four different retirement payment options available to FRS members. At the hearing, Petitioner acknowledged she signed the Spousal Acknowledgement Form. Ms. Tiffany Pieters was a duly licensed notary with the State of Florida and an employee of BCSO on February 11, 2013. Ms. Pieters notarized the Application for Service Retirement Form and Option Selection Form signed by Mr. DeMichael, and the Spousal Acknowledgement Form signed by Petitioner. The Division received Mr. DeMichael’s Application for Service Retirement Form, Option Selection Form, and Petitioner’s Spousal Acknowledgement Form on or about February 11, 2013. On February 20, 2013, Respondent mailed Mr. DeMichael an Acknowledgement of Service Retirement Application letter acknowledging Respondent’s receipt of Mr. DeMichael’s Application for Service Retirement Form; his selection of Option 1 as the benefit payment option; his employment termination date of February 11, 2013; and retirement date of March 1, 2013. The Acknowledgement of Service Retirement Application letter expressly provides that Mr. DeMichael cannot change the option he selected once his retirement becomes final, and that retirement benefits become final when any payment is cashed or deposited. Mr. DeMichael’s Application for Service Retirement Form and Option Selection Form also expressly provide that he cannot change the option he selected once his retirement becomes final, and that retirement benefits become final when any benefit payment is cashed or deposited. On February 20, 2013, Respondent also mailed Mr. DeMichael an Estimate of Retirement Benefit letter, which provides an estimate of the payment benefit for each of the four options. The letter also acknowledges that Mr. DeMichael selected Option 1, and that his option selection cannot be changed after any payment is cashed or deposited. On April 1, 2013, Respondent mailed a request for birth date verification to Mr. DeMichael. In response, on April 30, 2013, Respondent received Mr. DeMichael’s birth certificate. Based on his selection of Option 1, Mr. DeMichael received an initial retroactive payment of $7,809.76 on May 10, 2013; an initial regular retirement payment of $3,904.88 on May 31, 2013; and a subsequent retirement payment every month in 2013 in the monthly amount of $3,904.88. Mr. DeMichael received a retirement payment every month beginning May 2013 until he died on August 25, 2015. Mr. DeMichael received a total of 29 retirement payments for a total gross benefit amount of $119,832.92. Each retirement payment was cashed or deposited into Mr. DeMichael’s bank account. Respondent was notified of Mr. DeMichael’s death in August 2015. On or about October 6, 2015, Respondent notified Petitioner that Mr. DeMichael’s benefit had ended and that there would be no continuing benefit to her based on Mr. DeMichael’s Option 1 selection. In this proceeding, Petitioner claims she is entitled to change Mr. DeMichael’s Option 1 retirement benefit selection and receive a continuing monthly spousal benefit. In support of her position, Petitioner contends Mr. DeMichael’s selection of Option 1 is invalid because he lacked the mental capacity to make a retirement option at the time his Application for Service Retirement Form and Option Selection Form was submitted to Respondent. Based on the persuasive and credible evidence adduced at hearing, Petitioner failed to establish that Mr. DeMichael lacked the mental capacity to make a retirement option at the time his Application for Service Retirement Form and Option Selection Form were submitted to Respondent. No medical evidence was presented establishing that Mr. DeMichael was mentally incapacitated at the time he executed the Application for Service Retirement Form and Option Selection Form on February 11, 2013. In fact, Mr. DeMichael was released from Sunrise Detoxification Center on February 11, 2013, following in-patient rehabilitative treatment for his alcoholism. Petitioner’s Exhibit 7 expressly states that Mr. DeMichael “was medically stable for discharge” at 8:00 a.m. that morning. Moreover, Petitioner and Mr. DeMichael ate breakfast together later that morning at the BCSO cafeteria. Subsequently, Petitioner was escorted to the BCSO Internal Affairs area where she was questioned about Mr. DeMichael’s alcoholism. After Petitioner refused to answer any questions, she was escorted to the BCSO rooftop terrace. After a while, Mr. DeMichael came to the rooftop terrace. According to Petitioner, Mr. DeMichael was smiling and they exchanged pleasantries. After February 11, 2013, Mr. DeMichael continued to manage his own financial affairs, including his bank account. On April 1, 2013, Respondent sent a request to Mr. DeMichael to provide verification regarding his date of birth. In response, Mr. DeMichael sent his birth certificate to Respondent. Finally, at no time did Petitioner ever seek a guardianship or power of attorney over Mr. DeMichael, and at no time was Mr. DeMichael adjudicated incompetent by a court. Petitioner also claims that Mr. DeMichael’s selection of Option 1 is invalid and that she is entitled to a continuing benefit because she lacked the opportunity to read the Spousal Acknowledgement Form before signing it. Based on the persuasive and credible evidence adduced at hearing, Petitioner failed to establish that she lacked the opportunity to read the Spousal Acknowledgement Form before signing it. In support of her position, Petitioner testified at one point in the hearing that she only saw the area of the form near where she signed it. However, in the area of the form near where Petitioner signed (Respondent’s Exhibit No. 6) is the express “acknowledgement that the member has selected either Option 1 or 2.” At another point in the hearing, Petitioner testified she saw the small writing below her signature at the bottom of the Spousal Acknowledgement Form, but she did not read any of the writing. The small writing below Petitioner’s signature at the bottom of the form provides an explanation of the four retirement benefit payment options. Notably, Petitioner did not testify that she asked Ms. Pieters for any explanation of the Spousal Acknowledgement Form. Further, Petitioner did not testify that she needed or asked for more time to read the Spousal Acknowledgement Form before signing it, or that Ms. Pieters refused to allow her to read the form. Petitioner could have asked Ms. Pieters for more time to read the Spousal Acknowledgement Form if she felt it was necessary, but she did not. At no time did Petitioner ever file a complaint against Ms. Pieters or complain about her handling of the Spousal Acknowledgement Form. Had Petitioner been concerned about the Spousal Acknowledgement form or Mr. DeMichael’s mental capacity on February 11, 2013, she also could have spoken to Judy Cowell, Mr. DeMichael’s supervisor at BCSO. Ms. Cowell greeted Petitioner and Mr. DeMichael at the front office when they arrived at BCSO on the morning of February 11, 2013, and Ms. Cowell escorted them to the cafeteria and rooftop terrace. At hearing, Petitioner testified that Ms. Cowell “was like a mom,” and that she had spoken to her on numerous occasions when Mr. DeMichael had problems with his employment. At hearing, the undersigned had the distinct opportunity to observe Petitioner’s testimony and her demeanor. Petitioner’s testimony regarding Mr. DeMichael’s alleged mental incapacity on February 11, 2013, and her not having the opportunity to read the Spousal Acknowledgement Form and the alleged invalidity of the Spousal Acknowledgement Form, Option Selection Form, and Application for Service Retirement Form, is not credited and is rejected as unpersuasive. In sum, Petitioner is not entitled to change Mr. DeMichael’s selection of Option 1 as his FRS retirement benefits payment option and she is not entitled to a continuing benefit.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services, Division of Retirement, enter a final order denying Petitioner’s request to change the Florida Retirement System retirement benefits payment Option 1 selected by Mr. DeMichael and receive a continuing monthly spousal benefit. DONE AND ENTERED this 14th day of April, 2020, in Tallahassee, Leon County, Florida. S DARREN A. SCHWARTZ Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of April, 2020. COPIES FURNISHED: James C. Casey, Esquire Law Offices of Slesnick and Casey, LLP 2701 Ponce de Leon Boulevard, Suite 200 Coral Gables, Florida 33134 (eServed) Ladasiah Jackson Ford, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed) Nikita S. Parker, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed) David DiSalvo, Director Division of Retirement Department of Management Services Post Office Box 9000 Tallahassee, Florida 32315-9000 (eServed) Sean Gellis, General Counsel Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed)
The Issue The issues to be determined are whether Dawn Jenkins (“Jenkins”) failed to meet the Deferred Retirement Option Program (“DROP”) termination requirements set forth in chapter 121, Florida Statutes; and, if so, whether Petitioner, Town of Miami Lakes (“Miami Lakes,” the “Town,” or “Petitioner”), is required to reimburse Respondent, Department of Management Services (“DMS”), Division of Retirement (“DOR” or “Respondent”), for the overpayment of retirement benefits paid to Jenkins.
Findings Of Fact DMS is the state agency delegated to administer FRS. The Florida Legislature created DOR to manage the retirement plans and programs under FRS within DMS. FRS is a retirement program for state and local government employees administered pursuant to chapter 121. All state agencies participate in FRS. Local governments have the option of joining the plan if they meet certain requirements set out in statute and rule. Participating employers agree to follow chapter 121 and Florida Administrative Code Chapter 60S when they join FRS. Petitioner is the Town, a State of Florida municipal government located within Miami-Dade County and duly charted on December 5, 2000. In January 2004, the Town joined FRS as a participating employer. Jenkins was a member of FRS through her employment with Miami- Dade County Public Schools. Jenkins entered DROP and received two one- year extensions (totaling seven years) until her retirement, effective June 8, 2018. Before entering DROP, Jenkins signed a DP-Term form on May 7, 2018. The DROP termination notification form specified that Jenkins had to “terminate all employment relationships with all participating FRS employers for the first 6 calendar months after [her] DROP termination date.” Clary Garcia Ramos (“Clary”) is a Town employee. In her regularly established position, Clary teaches yoga part time at a community center for the Town and is paid $25.00 per hour per class. She has worked for Miami Lakes for approximately 15 years and is covered under the FRS. In the fall of 2018, Clary was having bilateral knee replacement surgery and asked her longtime friend Jenkins to help her out and cover her yoga classes with the Town while she was out after her surgery. Clary and Jenkins have known each other for approximately 15 years and obtained their yoga education together. Jenkins, a certified yoga instructor, agreed to help Clary out with her classes for September and October 2018. Miami Lakes did not post a position opening nor conduct interviews for a back-up, part-time yoga instructor. Before Jenkins started filling in for Clary, Jenkins was instructed to fill out paperwork to start the position. She first filled out an employment application dated August 22, 2015, and then a second one with the corrected date of August 22, 2018, for the position of yoga instructor. On the completed application, Jenkins informed the Town that she had retired from Miami-Dade County Public Schools with “40 years of service” on June 8, 2018. The last detachable page of the application allowed the Town to perform Jenkins’ required background screening since she would be teaching yoga with seniors, a vulnerable population. Only the last page of the application pertains to a background check. On or about August 31, 2018, Jenkins received an offer of employment letter signed by Town Manager Alex Rey (“Rey”) regarding the position she was filling in for Clary. The letter stated: SUBJECT: EMPLOYMENT LETTER Dear Ms. Jenkins: On behalf of the Town of Miami Lakes, I would like to offer you the position of Back up-Part-Time Instructor, Yoga. Instructors work under the supervision of the Leisure Services Manager and are required to select, plan, and teach cultural classes for youth and adults. Your supervisor will determine your schedule for yoga classes. This position start date is September [12], 2018 and the rate of pay will be $26.00 per hour. Each time you are scheduled to work, you will be required to submit a time sheet to your supervisor. This position qualifies for participation under the Florida Retirement System (FRS), and 3% employee contribution is mandatory. This employment offer is contingent upon satisfactory results of the following pre-employment requirements: Criminal Background check and Drug Screening Proof of required education, certifications and/or licenses This is an exciting step for the Town of Miami Lakes, and we look forward to you joining our team. Should this offer be considered acceptable, please sign below and return [i]t to the attention of Cynthia Alejo, Human Resources Specialist, to complete your pre-employment process. Jenkins signed the employment offer letter and accepted the FRS position from Miami Lakes on September 4, 2018. Rey was the town manager for Miami Lakes during all times material to this case. He was the chief executive of the Town and oversaw human resources. Cynthia Alejo (“Alejo”) was the Town’s part-time human resources specialist, who served as the assistant to Rey in the Human Resources Department. Alejo used Clary’s offer letter as a template when she drafted the employment offer letter that Jenkins signed. Ismael Diaz (“Diaz”), the Town’s comptroller and chief financial officer, was off work during October 2018 on vacation. While Clary was out recuperating, Jenkins performed yoga instruction to the seniors for the Town in her place. Jenkins was paid a rate of pay of $26.00 per hour per class. However, while in Clary’s position, Jenkins did not receive the benefits available for employees or receive orientation or training for new employees. Jenkins taught 16 one-hour yoga classes to senior citizens from September 13, 2018, until October 11, 2018. Jenkins was paid and received, as agreed in the terms of her employment offer letter, a total of $442.00 for the yoga classes she taught for the Town. The Town erroneously reported Jenkins to FRS. The Town’s monthly reports specifically included Jenkins under a preretirement code, which alerted DOR internally that a person who had retired was being reported within the first 12 months after retirement. Each month that Jenkins worked, the Town reported her wages to DOR and made retirement contributions to DOR with the payroll reports. During the period when the Town reported Jenkins to DOR as an employee for three consecutive months on its retirement reports, the wrong codes registered errors. DOR notified the Town that Jenkins should not be reported in that way. The Town could have corrected the errors. However, the Town never provided a correction report to change Jenkins’ status. Instead, by the Town continuously reporting Jenkins as an employee, a DOR review of Jenkins’ retirement status was triggered. Eventually, Jenkins found out that she was being reported as an employee to DOR by the Town and her DROP retirement funds were in jeopardy. On or about December 3, 2018, Jenkins complained to DMS, Office of Inspector General, regarding her potential violation of FRS rules. Jenkins was informed in writing that her complaint was being referred to DOR for review. Jenkins also telephoned DMS several times, including December 3, 10, and 11, 2018, and February 8, 2019, requesting a review of her reemployment status and possible voiding of DROP. Jenkins requested to speak with an FRS specialist regarding her FRS retirement issue by email on December 10, 2018. At one point, Jenkins spoke to Kathy Gould, DOR bureau chief of calculations, and informed her that the reporting of her as an employee was a mistake and she was just covering for a friend who was out after having surgery. Because of the variety of Jenkins’ requests to review her retirement issue, which included the inspector general complaint and the multiple payroll report errors reported for Jenkins, DOR investigated Jenkins’ retirement status. June Moore (“Moore”), from the retirement calculations section at DOR, handled Jenkins’ review for DOR. On or about December 13, 2018, Moore started looking into the Jenkins’ retirement issue and contacted the Town’s comptroller, Diaz, by email requesting Jenkins’ personnel action form when she was hired and informing the Town that Jenkins was reemployed with Miami Lakes and “in violation of [her] termination date.” That same day, Diaz emailed Alejo, copying Moore, to update Alejo that he had spoken with Moore and told her the Town had also issued Jenkins an offer letter. In the email, Diaz asked Alejo to provide Moore’s requested information and suggested that the situation be mitigated so that Jenkins did not suffer any financial loss. Diaz also suggested that Jenkins could perhaps return the $400.00 earned. Moore responded 30 minutes later by email, “We are still reviewing this account. Once we receive the documents from your agency we will let you know what the outcome is.” The next day, Alejo sent Moore Jenkins’ two personnel action forms dated September 25, 2018, and October 12, 2018, and the August 31, 2018, offer letter that had been executed by Jenkins. Alejo stated in the email that: [Jenkins] was also under the impression that as a temporary employee, this would not affect her retirement. As Mr. Diaz mentions, Ms. Jenkins is willing to return all funds back to the Town and instead be considered a volunteer. While we don’t know if that’s a possibility, we are willing to help in any way so that Ms. Jenkins does not suffer a financial loss. Both personnel action forms dated September 25, 2018, and October 12, 2018, listed Jenkins as a temporary part-time, hourly wage, non- exempt employee. Each form had FRS checked under the benefits section. Additionally, the September form had “temporary coverage for Clary” written on it and the October form had checked resigned with notice and “temp position” written on it. Jenkins also received an Internal Revenue Service W-2 wage and tax statement from Miami Lakes for her services of working as a yoga instructor at the Town in Clary’s place. On or about February 12, 2019, Alejo sent a memorandum to Diaz that was contrary to all the previous employment records the Town had regarding Jenkins’ employment. The memorandum changed Jenkins’ status to a volunteer and referenced her $26 per hour payments as a stipend. The memorandum stated: After a review of our records, it has come to my attention that Ms. Dawn Jenkins, who assisted the Town of Miami Lakes (the “Town”) as a senior fitness class volunteer during September 19, 2018 thru October 11, 2018 and was inadvertently classified as a Town of Miami Lakes employee. Additionally, a review of our records reveals that Ms. Jenkins did not receive a salary for her services. The only monetary contribution from the Town was in the form of a $26.00 daily stipend. Ms. Jenkins became a volunteer following her friend’s knee incident which required surgery. The Town required Ms. Jenkins to complete an application and consent to a criminal background search, which is standard policy for any volunteer that engages with vulnerable children or adults. Upon receipt of Ms. Jenkins application, the Town in error, reported Ms. Jenkins wages to the Florida Retirement System (“FRS”). The error was discovered within a month or so, and by that time, Ms. Jenkins had already stopped volunteering and was thereby removed from our payroll system. As a follow-up, the Town will need the assistance of the FRS administration to correct the error reported. FRS is under the impression that Ms. Jenkins abused the system by seeking re- employment after retirement. As detailed in this memorandum, this is not the case. Ms. Jenkins, at no time during the period of September 19 thru October 11, 2018 served the Town as a salaried employee. Should you have any questions, please do not hesitate to contact us. On February 19, 2019, DOR issued a final agency action letter, notifying Jenkins that she was “subject to the termination requirement found in [section] 121.021(39)(b), Florida Statutes,” and that she was required to “repay all retirement benefits previously paid to [her], as provided in Rule 60S-4.012, Florida Administrative Code,” in the amount of $445,013.04. Jenkins petitioned for, and received, a section 120.57(1), Florida Statutes, hearing in response to the notice of intended agency action that would have required her to repay her DROP payout and the retirement benefits she had received. The DOAH case number assigned to that proceeding is 19-1692. Case No. 19-1692 was litigated through the final hearing. At that final hearing, the parties presented evidence and testimony of the same witnesses in this proceeding. After the administrative hearing on December 20, 2019, DMS and Jenkins entered into a Settlement Agreement to resolve the issues related to her termination of DROP and retirement benefits. As part of the Settlement Agreement, Jenkins’ benefit amount was recalculated based on the additional service credit she earned for the years she participated in DROP. The Settlement Agreement also deducted $464.86 monthly from Jenkins’ retirement benefits for a lifetime to repay $445,013.04, the overpayment amount in DROP benefits. In addition, a part of the Settlement Agreement obligated DMS to seek reimbursement for the entire debt, $445,013.04, from Miami Lakes. After settling the case with DMS, Jenkins voluntarily dismissed Case No. 19-1692 with prejudice. On October 2, 2020, DMS then issued its Notice of Intended Agency Action against the Town, informing Miami Lakes that due to hiring Jenkins on September 12, 2018, her FRS termination requirement of ceasing all employment with an FRS employer for six calendar months was never satisfied and, as a result, whenever a participating employer employs a retired FRS member in violation of the termination requirements, both the employee and the participating employer are liable for repayment of the money to the FRS Trust Fund in accordance with section 121.091(9)(c)3. The notice included an invoice demanding payment from the Town of the full amount of the “overpayment of benefits” to Jenkins. The Town timely filed a Petition for Formal Hearing contesting the agency action letter. Ultimate Findings of Fact Upon careful consideration of the entire record, it is determined that DMS has demonstrated by the preponderance of the evidence that Jenkins was an employee of Miami Lakes instructing yoga from September 2018 to October 2018, while Clary was out recuperating. It is interesting to note that, even though Jenkins testified at hearing, she did not believe providing services to the Town to help a friend who was having knee surgery was violating the DROP agreement, and she did not realize that Miami Lakes was a participating employer with FRS when she substituted for Clary while she was out recuperating. Jenkins did admit that she understood the DP-Term form she signed, which specified that she could not work for any FRS entities. Jenkins was also honest and forthright and admitted at hearing that she did not read the September 4, 2018, employment offer letter that she signed when she accepted the FRS position. Had she read the employment letter, she would have been put on notice that the position she was taking was “under the Florida Retirement System, and 3% employee contribution is mandatory.” At hearing, Alejo testified that it was her first time processing an employee covering for another employee. Notwithstanding her lack of experience, the evidence establishes Jenkins was employed with Miami Lakes. In this matter, Miami Lakes was notified of Jenkins’ retirement on June 8, 2018, from Miami-Dade County Public Schools on her employment application before she started the position. Also, the Town offered Jenkins employment through Rey, the Town’s human resources chief executive. The employment offer letter informed Jenkins who her supervisor was and specified participation in FRS, which both Rey and Jenkins signed. Additionally, the Town checked FRS twice under Jenkins’ benefit sections on both her personnel action forms. Likewise, the September personnel action form had “temporary coverage for Clary” written on it and the other form had “temp position” written on it. The evidence also demonstrates that the Town reported Jenkins’ wages as an employee three months in a row and made retirement contributions to DOR on three consecutive payroll reports. At hearing, Dr. Joyce Morgan credibly testified that even after DOR notified Miami Lakes that there was an error in reporting Jenkins, they continued to report her in November and December 2018, and the Town never attempted to correct the error or contact DOR to get help in correcting any errors.1 In addition, the Town properly issued Jenkins a W-2 tax statement as an employee for instructing yoga for Miami Lakes not a 1099 statement. At hearing, the record not only shows Miami Lakes hired Jenkins as an employee, but was fully aware of her employee status with the Town. The evidence demonstrates that Diaz, the comptroller, confirmed by his December 13, 2018, email that Jenkins’ status was a Town employee when he informed Moore that Jenkins had executed an employment offer letter and Diaz attempted to assist mitigate Jenkins’ financial loss with DOR by suggesting her pay be returned to the Town. Additionally, Alejo further established Miami Lakes’ full knowledge of Jenkins’ status as an employee with the Town in her email of December 14, 2018, when she admitted she did not know if it were possible, but offered to help Jenkins not suffer a financial loss by suggesting to Moore to change Jenkins’ title so Jenkins could be considered a volunteer and return the money paid. The record also demonstrates that it was not until almost two months later in February 2019, that the Town’s Human Resource Department actually reclassified Jenkins’ title to a senior fitness volunteer and renamed her “rate of pay” that had formally been $26.00 per hour in the employment offer letter to a “$26.00 daily stipend” in an internal memorandum2 that Alejo sent to Diaz. 1 The undersigned is not persuaded that the Town’s reporting error was caused because Comptroller Diaz was out on vacation during October 2018, because the errors were not corrected after Diaz returned and have not been corrected as of the date of the hearing. Additionally, the Town’s errors are not determinative of Jenkins’ employment status. Any contention that correcting the error in the payroll report would have an impact on changing Jenkins’ employee status is misplaced. To that end, the payroll report does not determine Jenkins’ employment status. 2 The undersigned rejects the memorandum as reliable evidence to help determine Jenkins’ employment status since the record demonstrates that Alejo had been working on Jenkins’ behalf to help her from receiving a financial loss for approximately two months. An internal title change by the Town did not change Jenkins’ status as a temporary yoga employee for Miami Lakes. Additionally, the record shows that the Town did not process Jenkins as it did for other volunteers. At hearing, Rey testified that there were categories of volunteers: resident volunteers that served on different committees and volunteers through agreements. Rey explained that volunteers with the Town are non- paid persons and the Town only reimburses volunteers for supplies by providing the funds or obtaining a receipt for reimbursement, neither of which occurred with Jenkins. Rey also testified that upon learning there was an issue with Jenkins’ employment, he explained to Jenkins that she had been hired by Miami Lakes as a “temporary employee to cover for a limited period of time.” Rey also testified that Jenkins was never considered a volunteer for the Town. Therefore, the greater weight of the evidence in this cause establishes that Miami Lakes employed Jenkins as a temporary yoga instructor. Hence, Jenkins was reemployed by an FRS employer, Miami Lakes.
Conclusions For Petitioner: Onier Llopiz, Esquire Joan Carlos Wizel, Esquire Lydecker Diaz 1221 Brickell Avenue, 19th Floor Miami, Florida 33131 For Respondent: Thomas E. Wright, Esquire Gayla Grant, Esquire Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services, Division of Retirement, enter a final order that: Finds that Jenkins’ reemployment with Miami Lakes, an FRS municipality, failed to meet the DROP termination requirements; Upholds DMS’s October 2, 2020, notice of intended agency action that the Town of Miami Lakes is jointly and severally liable for repayment; Requires the Town of Miami Lakes to pay back the total overpayment of Jenkins’ benefits in the amount of $445.013.04; and Allows the Town of Miami Lakes to repay the overpayment in installments over a three- to five-year period. DONE AND ENTERED this 20th day of December, 2021, in Tallahassee, Leon County, Florida. COPIES FURNISHED: S JUNE C. MCKINNEY Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 20th day of December, 2021. Thomas E. Wright, Esquire Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 Gayla Grant, Esquire Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 Onier Llopiz, Esquire Lydecker LLP 1221 Brickell Avenue, 19th Floor Miami, Florida 33131 Joan Carlos Wizel, Esquire Lydecker LLP 1221 Brickell Avenue, 19th Floor Miami, Florida 33131 Kristen Larson, Interim General Counsel Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 David DiSalvo, Director Division of Retirement Department of Management Services Post Office Box 9000 Tallahassee, Florida 32315-9000 Trey D. Evans, Esquire Lydecker LLP 1221 Brickell Avenue, 19th Floor Miami, Florida 33131
The Issue The issue in this case is whether the Petitioner, Mr. Robert P. Hatcher, is eligible to retire under the Florida Retirement System rather than under the Teachers' Retirement System.
Findings Of Fact The Petitioner was employed by the Hillsborough County School Board on August 25, 1959, and was enrolled in the Teachers' Retirement System (TRS) at that time. The Petitioner worked for the Palm Beach County School Board for 27 years, from 1966 through May 15, 1992. The Petitioner worked with no breaks in service during all years in which the Legislature provided open enrollment periods for members of the TRS to transfer to the Florida Retirement System (FRS). The Petitioner was aware of the open enrollment periods, but declined all opportunities to transfer to the FRS. In this regard, the Petitioner specifically rejected membership in the FRS for the 1974 and 1978 open enrollment periods by signed ballots dated November 27, 1974, and November 2, 1978. Petitioner voluntarily terminated his employment with the Palm Beach County School Board on May 15, 1992. Following his termination with the Palm Beach County School Board, Petitioner began seeking employment with an agency that participated in the FRS in order to become eligible to transfer from the TRS to the FRS. The Petitioner's first contact with the Okeechobee County School Board (OCSB) was approximately two years ago when Dr. Mary Gray, Petitioner's acquaintance, introduced Petitioner to Mr. Owens. The Petitioner approached Mr. Owens in an attempt to obtain employment with the OCSB. The Petitioner sought employment with the OCSB for the sole purpose of obtaining entry into the FRS. Mr. Owens recruited and interviewed the Petitioner for the position of Custodian I at the OCSB. At the time the Petitioner was recruited and interviewed, Mr. Owens knew the Petitioner wanted to work for the OCSB for the sole purpose of establishing retirement eligibility. The Petitioner requested that he be hired to work only long enough to establish retirement eligibility by working for a state employer that was a member of the Florida Retirement System. Prior to the Petitioner's request, the OCSB had never had such a request before. The OCSB hired the Petitioner with the knowledge that he had health problems and believing that he would not be able to perform the duties of custodian for more than a short period of time. By letter dated June 23, 1993, the OCSB approved the Petitioner's employment as Custodian I for the OCSB effective June 30, 1993. The Custodian I position was classified as a regular position, not a short-term position. The Petitioner reported to work at the Okeechobee High School on June 30, 1993. He answered phones for several hours, performed some inventory work, then resigned that afternoon. The OCSB acknowledged receipt of the Petitioner's resignation letter, effective June 30, 1993, by letter dated August 2, 1993. The Petitioner submitted an application for membership in the FRS to the OCSB on June 30, 1993. Prior to his employment with the OCSB, the Petitioner investigated the possibility of transferring from the TRS to the FRS. The Petitioner was neither told nor did he receive any written communication by the DOR that he could transfer to the FRS based upon employment for one day. By letter dated August 16, 1993, the Respondent notified the Petitioner that he could not obtain entry into the FRS because his employment was not bona fide, but that he could retire under the TRS. If the Petitioner were to retire under the TRS, his Option 1 monthly benefit payment would be $2,571.64; his Option 3 monthly benefit payment would be $2,396.25. Under the FRS, Petitioner's Option 1 monthly benefit payment would be $3,054.91; his Option 3 monthly benefit payment would be $2,771.20.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the Division of Retirement issue a final order concluding that the Petitioner is not eligible for participation in the Florida Retirement System and denying Petitioner's application for transfer from the Teachers' Retirement System to the Florida Retirement System. DONE AND ENTERED this 6th day of January 1994 in Tallahassee, Leon County, Florida. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 6th day of January 1994. APPENDIX The following are my specific rulings on all proposed findings of fact submitted by all parties. Findings submitted by Petitioner: Paragraphs a and b: Accepted in substance. Paragraph c: Accepted in part and rejected in part; accepted that the Petitioner obtained the described employment, but rejected that the employment was bona fide. Paragraph d: Accepted in part and rejected in part. The conclusion that the one day was sufficient to qualify the Petitioner for transfer to FRS is rejected as incorrect and as not warranted by the evidence; the remainder of the facts in this paragraph are accepted. Paragraph e: Rejected as constituting a conclusion of law, rather than a proposed finding of fact; a conclusion which is, in any event, not warranted by the evidence in this case. Paragraph f: Rejected as constituting a conclusion of law, rather than a proposed finding of fact; a conclusion which is, in any event, not warranted by the evidence in this case. Findings submitted by Respondent: All of the proposed findings of fact submitted by the Respondent have been accepted in whole or in substance in the Findings of Fact made in this Recommended Order. COPIES FURNISHED: Jodi B. Jennings, Esquire Division of Retirement Building C Cedars Executive Center 2639 North Monroe Street Tallahassee, Florida 32399-1560 Allan L. Hoffman, Esquire 1610 Southern Boulevard West Palm Beach, Florida 3406 J. McMullian, III, Director Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 William H. Lindner, Secretary Department of Management Services Knight Building, Suite 307 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950 Sylvan Strickland, Acting General Counsel Department of Management Services Knight Building, Suite 309 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950
The Issue The issue in this case is whether Fred E. Hild (Colonel Hild), a deceased member of the Florida Retirement System, was incapacitated at the time he selected his retirement option and through the time that his first benefits check was cashed and, if so, whether his retirement option should be amended retroactively to provide benefits for Petitioner, Lois Hild, his spouse.
Findings Of Fact Colonel Fred Hild, late husband of Lois Hild, served in the Air Force for 25 years before retiring from that service. After retirement from the Air Force and after Valencia Community College opened in Orlando, Florida, Colonel Hild joined the college staff, first as a teacher and then as an administrator. At the time of his retirement from the college, he was assistant to the provost. He worked at the college from 1978 until 1996. His employment at the college was covered by the Florida Retirement System (FRS). With the exception of a year's employment in her family's business, Mrs. Hild never worked outside of her home. She and Colonel Hild were married over 50 years and had a full, active life together. Colonel Hild provided the financial support for the family and, except for routine household expenses when he was away in the Air Force, he handled all of the family's financial affairs. Colonel Hild's family and co-workers acknowledge that he was a remarkable man in many ways, physically vigorous and mentally sharp. His work was always an important aspect of his life; he was well-respected and well-known on the college campus and, because of his long tenure, was very knowledgeable about the history and functioning of the college. As he aged, Colonel Hild slowed down a bit; he had days at work when he was sleepy or grumpy. Most days, though, he was quite normal and sharp. He knew all of the regulations for the college and always went by the rules. On October 12, 1995, at the age of 81 years, Colonel Hild suffered a major cerebrovascular accident (stroke) while at home. The stroke left lasting side effects. For a time after the stroke he lost all short-term memory and could neither read nor write. He became passive and frail. He underwent rehabilitation and improved quite a bit, according to Mrs. Hild, but he was never again the same man. Colonel Hild's son, David, who lived in California, sold his car and possessions and moved in with his parents to help Mrs. Hild provide the care Colonel Hild then required. This care included driving and assistance ambulating in the home neighborhood, where he would sometimes get lost. Colonel Hild was never again able to drive, as he lost part of his peripheral vision and would forget where he was going. He was unable at times to recognize friends or family members. He slept a lot and needed supervision in showering and dressing. He never again was able to assume responsibility for the financial affairs of the family. The Hild's son, Steve, an accountant in Miami, Florida, helped Mrs. Hild with financial planning and paperwork. Before his stroke Colonel Hild had made some plans for retirement. He spoke to co-workers of investments in stocks and bonds, and when the Air Force brought in a survivor's benefit program, he took advantage of that so that his wife would have some benefits when he died. He also spoke to Mrs. Hild of their having retirement benefits from Valencia for ten years. Still, before the stroke Colonel Hild worried about having enough for retirement and his worries increased after the stroke. He insisted on returning to work at the college after his rehabilitation and some recovery. Although they were worried about how he could function, Colonel Hild's wife and sons were reluctant to oppose him when he was so insistent. Dr. Collins, his personal physician for over 20 years, provided certificates authorizing Colonel Hild to return to the college part-time on April 8, 1996, and full time on June 1, 1996. Dr. Collins believed that the duties would be light and that the family and college staff would look out for Colonel Hild. Colonel Hild's son, David, drove him to and from work and made sure Colonel Hild got in the building. The first time they made the drive, Colonel Hild directed his son to the wrong campus of the college. Already thoroughly trained in the paperwork, the secretaries picked up much of the work that Colonel Hild had been doing. For example, they listened to students' problems and tried to work them out with the department chairpersons. For final decisions, the staff referred the problems to the provost, Dr. Kinzer. Colonel Hild's duties on his return to work were light. Because Colonel Hild was very organized and knew so much about the college, he was able to function with the help of his staff. He could review documents prepared for him and would initial or sign the documents, as appropriate, sometimes changing something if it had not been prepared correctly. Some days were better than others; he slept more than he did before his stroke and would sometimes get lost on campus. Because he was so well- known, someone would always help him back to his office. One of the annual responsibilities of Colonel Hild was organizing the graduation processions, making a list of the order of the march and placing posters or signs in the corridors for guidance. He performed this function without complaint in early May 1996. He refused assistance of his staff and, except for a couple of posters on the opposite wall, he managed to get everything done. At the actual graduation night, however, Colonel's Hild's, son, David, had to help him find his way at the end of the ceremony and recessional march. Colonel Hild retired from Valencia Community College on July 31, 1996. In preparation for that retirement he had several contacts with staff in the college's human resources office. Initially, Colonel Hild signed a form on May 30, 1996, applying for retirement and leaving blank the benefit option selection since he had not yet received an estimate of the amounts he would receive under each option. Vicki Nelson, a staff person in the human resources office, had approximately 4 or 5 contacts with Colonel Hild, face-to-face or over the telephone, while preparing paperwork for his retirement. At one point she was concerned that she was having to explain things over again and she suggested to Colonel Hild and to his secretary that maybe he should bring Mrs. Hild in with him. The issue she was trying to explain had something to do with the need to obtain Mrs. Hild's birth certificate if he selected either option 3 or 4. The suggestion was never followed up and ultimately Mrs. Hild's birth certificate was unnecessary. Michael Break is assistant vice-president of human resources at Valencia Community College. In his capacity as director of human resources Dr. Break was involved in preparing Colonel Hild's retirement documents. On June 19, 1996, Dr. Break, Vicki Nelson, and Colonel Hild met to discuss the benefit options and the monthly estimates of each amount. The FRS provides four benefit options to its retirees. Option 1 yields the maximum monthly benefit, but when the retiree dies there is no survivor benefit. Option 2 yields a reduced monthly benefit for 10 years. If the retiree dies before the end of 10 years, the benefit is paid to the survivor for the balance of the 10 years. Option 3 provides a reduced benefit for the joint lifetimes of the member and beneficiary; Option 4 provides a reduced benefit for the lifetimes of the retiree and beneficiary, which benefit is reduced by 33 1/3% upon the death of either. As explained to Colonel Hild, his monthly benefit under option 1 was $2,569.64; under option 2, his benefit was $1,692.72; under option 3 the benefit was $1,546.92; and under option 4, the benefit was $1,856.41, reduced to $1,237.61 upon the death of Colonel or Mrs. Hild. In his discussion with Colonel Hild, Dr. Break pointed out the implications of the various options, including the need to consider such factors as one's health and financial arrangements for a dependent spouse. In response, Colonel Hild mentioned that he had other financial means and this was not the only retirement that he depended on. Although Dr. Break was aware that some people were concerned about Colonel Hild's effectiveness after his return to work, nothing in Colonel Hild's responses to the discussion in the meeting raised red flags to alert Dr. Break that Colonel Hild did not understand. Colonel Hild expressed his opinion that the difference between benefits under option 1 and the remaining options was excessive. In Dr. Break's experience, and as he counsels pre- retirees, sometimes the selection of option 1, with the additional purchase of an annuity or life insurance policy, inures to the greater benefit of an individual's dependents than the other reduced-benefit options under the FRS. When a retiree selects option 1 or 2, there is a section on the option selection form for the spouse to sign in acknowledgment of the option. Colonel Hild brought the form home and gave it to Mrs. Hild to sign one morning before he left for work. When she signed it the form was blank. All she knew was what he told her, that the form was something she had to sign for his retirement. She did not question her husband or even read enough of the form to know that there were 4 options. Mary Ann Swenson has been employed at Valencia Community College for thirteen years, 8 of which have been in the human resources department. Ms. Swenson notarized Colonel Hild's signature on the benefits option form on June 24, 1996, and remembers the occasion. Colonel Hild came to the human resources office to meet with Vicki Nelson, who called Ms. Swenson. At the time that Colonel Hild signed the form, Mrs. Hild's signature was already on it, but her signature did not require a notary. Likewise, option 1 had been checked on the form and, in response to a question by Colonel Hild, Vicki Nelson showed him that he marked option 1 and said, "Yes, you have marked option 1." Colonel Hild signed the form and then Ms. Swenson notarized it. On June 24, 1996, during the approximately 10 minutes that Ms. Swenson spent with Colonel Hild and Vicki Nelson, she had no reason to believe that he was not in complete control of his mental facilities or that he failed to understand and recognize what he was signing. Colonel Hild retired, as planned, the end of July 1996, and his first retirement check arrived approximately August 30, 1996. Mrs. Hild saw the check and had her husband endorse it. She then cashed the check. She understood that by doing so, she was accepting the amount of the check. She saw no problem with this because she assumed that Colonel Hild had opted for what he and she had discussed as the "ten year" provision. Mrs. Hild assumed that the check reflected the number of years he was employed and the amount of money that he was making. The Hild's son, Steve, made the same assumption, as he and Colonel Hild had discussed retirement sometime in the early 1990's and Steve understood that his father would take the 10- year plan with Valencia. Neither Steve nor Mrs. Hild had requested any information from the college or Division of Retirement about the option selected by Colonel Hild or the amount of benefits he would receive once he retired. Colonel Hild died on September 28, 1997. He had received a total of approximately $37,000, or 14 months of benefits under FRS option 1 during his lifetime. Mrs. Hild and Colonel Hild's sons learned of the option 1 selection when the checks stopped coming after Colonel Hild's death and when Mrs. Hild called the college human resources office. It is necessary to glean Colonel Hild's mental capacity and state of mind from the circumstances described by the witnesses in this case, all of whom were candid and credible. From those circumstances it is impossible to find that Colonel Hild was incompetent to make the decision to chose option 1 for his FRS benefits. That decision was entirely consistent with his concern, described by his family and staff at the college, that there be enough money coming in when he retired. Although he plainly was concerned for making financial arrangements for his spouse, he had made some arrangements already with his Air Force retirement and with other assets or investments. Described as strong-willed, disciplined and well- organized, Colonel Hild, in spite of his diminished capacity after his stroke, convinced his family, the college and his long time physician that he should return to work. And he did function in that work prior to retirement, performing by habit those tasks that he had mastered in his long tenure. No one suggests that Colonel Hild was coerced, pressured or hurried into the decision he made. The various staff who met with him on several occasions regarding his retirement believed that he was capable of making his own decision and that he exercised the very option that he intended.
Recommendation Based on the foregoing, it is hereby RECOMMENDED: THAT the Florida Division of Retirement issue its final order denying the relief sought by Petitioner, Lois Hild. DONE AND ENTERED this 4th day of March, 1999, in Tallahassee, Leon County, Florida. MARY CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 1999. COPIES FURNISHED: Harold Lewis, Esquire Division of Retirement Cedars Executive Center 2639-C North Monroe Street Tallahassee, Florida 32399-1560 Julia Smith, Esquire Amundsen and Moore 502 East Park Avenue Post Office Box 1759 Tallahassee, Florida 32302 A. J. McMullian, III, Director Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Emily Moore, Chief Legal Counsel Division of Retirement Cedars Executive Center, Building C Tallahassee, Florida 32399-1560
The Issue The issue in this case is whether Petitioner, a surviving beneficiary, is entitled to change the Florida Retirement System retirement benefits 1 All references to chapter 120 are to the 2019 version. payment option selected by her now-deceased spouse, a member of the Florida Retirement System.
Findings Of Fact Respondent, Department of Management Services, Division of Retirement, is the state agency charged under chapter 121, Florida Statutes (2002),2 with administering the Florida Retirement System ("FRS"). Petitioner is the spouse of James L. Williams, now deceased, who was employed by the School District of Palm Beach ("District) for 38 years, and was a member of the FRS. Williams retired from his employment with the District on August 23, 2002. At that time, he executed the Florida Retirement System Application for Service Retirement Form, Form FR-11. On Form FR-11, he designated Petitioner as his primary beneficiary and Jones as his contingent beneficiary. Williams signed this form, and his signature was notarized. Also on August 23, 2002, Williams executed the Florida Retirement System Option Selection for FRS Members Form, Form FRS-11o. On that form, he selected FRS retirement benefits payment Option 2, and designated that choice by writing an "X" on the line next to Option 2. Option 2 was described on Form FRS-11o as: A reduced monthly payment for my lifetime. If I die before receiving 120 monthly payments, my designated beneficiary will receive a monthly benefit in the same amount as I was receiving until the monthly benefit payments to both of us equal 120 monthly payments. No further benefits are then payable. 2 All references to chapter 121 are to the 2002 version of the Florida Statutes, which was in effect at the time that the retirement benefits application and option selection forms that have given rise to this proceeding were executed. Form FRS-11o contained a section, immediately below the description of Option 2, that was required to be completed by the spouse of a married FRS member who had selected Option 1 or Option 2. On August 23, 2002, Petitioner completed, signed, and dated that section, confirming that she was the legal spouse of Williams and acknowledging that she was informed that Williams had selected either Option 1 or Option 2. The purpose of that section on Form FRS-11o is to inform the spouse of the FRS member that, by the member's selection of either Option 1 or Option 2, the surviving spouse is not entitled to receive a continuing benefit for the rest of his or her life. The last sentence on Form FRS-11o, immediately above the space for the FRS member's signature, states in pertinent part: "[m]y retirement becomes final when any payment is cashed . . . [or] deposited." DeVonnia Jones was present with Williams at the time he was given Form FR-11 and Form FRS-11o to execute. Jones testified that when Williams arrived at the District office on August 23, 2002, Form FR-11 and Form FRS-11o already had been filled out by District staff, and were presented to him by his supervisor, who informed him that he needed to retire or he would be terminated. According to Jones, Williams did not wish to retire at that time. Jones asked District staff how much more Williams' monthly benefits would be if he did not retire for another year or two, and was told that Williams' benefits would be between $25 and $30 more per month. According to Jones, "my dad basically shed a couple tears. He was not comfortable, but he went ahead and signed it because I told him to, because they made it seem like he wasn't going to be eligible to get what he was supposed to get." Williams signed and dated Form FRS-11o on August 23, 2002, and his signature was notarized. On August 28, 2002, Respondent sent Williams a document titled "Acknowledgement of Service Retirement Application." This document stated, among other things, that Williams had selected FRS Option 2, and that his retirement was effective September 2002. At the bottom of this document was a standalone paragraph, in bold face type, that read: "ONCE YOU RETIRE, YOU CANNOT ADD ADDITIONAL SERVICE OR CHANGE OPTIONS. RETIREMENT BECOMES FINAL WHEN ANY BENEFIT PAYMENT IS CASHED OR DEPOSITED!" Also on August 28, 2002, Respondent sent Williams a document titled "Florida Division of Retirement Estimate of Retirement Benefit (Estimate only, subject to final verification of all factors)." This document provided information regarding the amount of the monthly benefits Williams would receive for the four options offered under the FRS. A statement in bold face type at the bottom of the document read: "Comments: You have chosen Option 2. Your option selection cannot be changed after you cash or deposit any benefit payment." Had Williams wished to change his retirement benefits payment option, he could have done so up to the time he cashed or deposited a retirement benefits payment. Williams began receiving his monthly FRS retirement benefits payments from Respondent on October 4, 2002. He cashed or deposited the first FRS benefits warrant (Warrant #0618275) that he received. Thereafter, Williams received monthly FRS retirement benefits payments until his death on April 26, 2010. Williams received a total of 92 monthly benefits payments before his death. All of the FRS retirement benefits payment warrants issued to Williams were deposited or cashed. On May 17, 2010, Respondent contacted Petitioner to inform her that she needed to complete a Florida Retirement System Pension Plan Application for Beneficiary of Monthly Retirement Benefits Form, Form FST- 11b, in order for her to receive monthly FRS retirement benefits payments as Williams' beneficiary. In the contact letter, Respondent informed Petitioner that "you will receive the same gross monthly benefits to which the member was entitled through August 31, 2012." Petitioner completed Form FST-11b on June 25, 2010, and began receiving FRS monthly benefits payments on June 30, 2010. Petitioner received a total of 28 FRS retirement monthly benefits payments. The last warrant issued to Petitioner (Warrant #0375196) was issued on August 31, 2012. All of the warrants issued to Petitioner were cashed or deposited. In sum, Williams and Petitioner collectively received a total of 120 FRS retirement monthly benefits payments, pursuant to Option 2. All of the warrants issued to Williams, and then to Petitioner, as his beneficiary, were deposited or cashed. Petitioner testified that beginning in 2003, she made numerous attempts, over a period of years, to contact the District and Respondent regarding changing the FRS retirement benefits payment option that Williams had selected on August 23, 2002. During this time, Williams and Petitioner continued to cash or deposit the benefits payment warrants they received from Respondent. In this proceeding, Petitioner does not claim that Williams accidentally selected Option 2, or that he intended to select another option, when he signed Form FRS-11o on August 23, 2002. Rather, she asserts that at the time Williams retired, he suffered from confusion and memory loss such that he did not understand the option he chose—effectively, that he lacked the mental capacity to have chosen Option 2 as his retirement benefits payment option. Alternatively, Petitioner contends that because Williams was forced to retire under threat of termination from his employment, he was under duress when he chose Option 2 on Form FRS-11o. On these grounds, Petitioner asserts that she should be permitted to change Williams' choice of retirement benefits payment option.3 3 Here, Petitioner, has requested that she be allowed to "change" Williams' choice of Option 2 on the FRS retirement option selection forms. She did not identify, or present evidence, Petitioner's impassioned testimony at the final hearing shows that she fervently believes her husband was wrongly treated by the District when it required him to retire in 2002, against his desire to continue to work.4 However, as was explained to Petitioner at the final hearing, the purpose of this proceeding was not to determine whether the District wrongly forced Williams out of his employment; rather, it is to determine whether there is any factual or legal basis for changing the retirement benefits option that Williams selected when he executed Form FRS-11o nearly 18 years ago. The evidence does not support Petitioner's argument that Williams lacked the mental capacity to adequately understand the option that he chose on Form FRS-11o. Although Petitioner testified that Williams had been treated by a neurologist, no direct medical evidence was presented establishing that Williams was mentally incapacitated at the time he executed Form FRS-11o. Additionally, at the time Williams signed the form, he was accompanied by his daughter, who, after speaking to District staff regarding his options, advised him to sign the form. Petitioner herself also was present at the District office and signed Form FRS-11o, expressly acknowledging that she understood Williams had chosen Option 2. Thus, to the extent that Williams may not, on his own, have fully appreciated his choice of options on Form FRS-11o—and there is no competent direct evidence showing that to be the case—both his daughter and wife were present with him when he executed Form FRS-11o, his daughter told him to sign the form, and his wife expressly acknowledged that she understood his choice of Option 2. These circumstances do not support a finding that Williams lacked the mental capacity to understand, or did not adequately regarding which specific option she would choose, if permitted to change Williams' selected FRS benefits option. 4 The evidence indicates that the District required Williams to retire because he began having difficulty with his job as a mail carrier. According to Petitioner, Williams had an accident in a District vehicle and did not report the accident to the District, and that when he was transferred to the mail room, he had difficulty remembering to do certain required tasks. understand, the consequence of choosing Option 2 when he executed Form FRS-11o. The evidence also does not support a finding that Williams' choice of Option 2 should be changed, due to duress. There is no direct evidence establishing that Williams was under duress when he chose Option 2. Although Jones testified, credibly, that her father was upset about being forced to retire when he wanted to continue working, her testimony that he was under duress was based on her subjective conclusion. Furthermore, even if Williams was emotionally distressed when he signed the FRS benefits options forms, there is no evidence showing that as result of such distress, he chose Option 2 instead of a different option. It also is noted that Form FR-11 and Form FRS-11o both expressly informed Williams that once his retirement became final—which would occur when any benefit payment was cashed or deposited—his retirement benefits option selection would become final and could not be changed. Further, Williams received two more pieces of correspondence from Respondent—both containing statements in bold face type—expressly informing him that once any FRS retirement benefits payments were cashed or deposited, his retirement benefits option choice could not be changed. As noted above, Williams could have changed his FRS benefits option at any time before he cashed or deposited a benefits payment; however, he did not do so. Thus, pursuant to the express terms of Form FR-11 and Form FRS-11o, when Williams cashed or deposited the first benefits payment, his selection of Option 2 became final and could not be changed. In sum, the evidence does not establish any factual basis for permitting Petitioner to change Williams' selection of Option 2 as his FRS retirement benefits payment option.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent, Department of Management Services, enter a final order denying Petitioner's request to change the FRS retirement benefits payment option selected by her husband, an FRS member, when he retired. DONE AND ENTERED this 4th day of March, 2020, in Tallahassee, Leon County, Florida. S CATHY M. SELLERS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 2020. COPIES FURNISHED: Ladasiah Jackson Ford, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed) Deloris Williams 1219 West Ninth Street Riviera Beach, Florida 33404 (eServed) Nikita S. Parker, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed) David DiSalvo, Director Division of Retirement Department of Mangement Services Post Office Box 9000 Tallahassee, Florida 32315-9000 (eServed) Sean Gellis, General Counsel Office of the General Counsel Department of Mangement Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 (eServed)
The Issue Whether Petitioner is "vested," as that term is defined in Subsection (45) of Section 121.021, Florida Statutes.
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following findings of fact are made: Prior to July of 2000, Petitioner worked on a permanent part-time basis as an adult education teacher for the Miami-Dade County School Board (School Board), accumulating 7.10 years of retirement credit. On Sunday, July 2, 2000, Petitioner was hospitalized because of a "blood disorder." Since his hospitalization on July 2, 2000, Petitioner has been under a doctor's care and has not been physically able to return, and therefore has not returned, to work. Petitioner was hospitalized again in 2001 and for a third time in 2002 for the same ailment. After each visit he has made to the doctor during the time he has been out of work, Petitioner has apprised the principal of the South Dade Adult Education Center (South Dade), where he had worked before his July 2, 2000, hospitalization, of his condition. It is now, and has been at all times following his July 2, 2000, hospitalization, Petitioner's intention "to return to work upon clearance from [his] doctor." Petitioner has not been paid by the School Board during the time he has been out of work. In April of 2001, Petitioner spoke separately with a representative of the United Teachers of Dade (UTD) and with a School Board staff member concerning his employment situation. The UTD representative advised Petitioner that Petitioner "was on an approved leave of absence." The School Board staff member told Petitioner that he "should be on an approved leave of absence"; however, she was unable to "find that authorization in the computer." She suggested that Petitioner go to School Board headquarters and inquire about the matter. Petitioner went to School Board headquarters, as the School Board staff member had suggested. The persons to whom he spoke "couldn't locate the [leave] authorization either." They suggested that Petitioner contact the principal of South Dade. Taking this advice, Petitioner wrote two letters to the principal inquiring about his employment status. He received no response to either letter. During the summer of 2001, Petitioner contacted the Division to ask about his eligibility to receive retirement benefits. Lisa Skovalia, a Benefits Specialist with the Division, responded to Respondent's inquiry by sending him the following letter, dated August 22, 2001: Our records indicate that you were neither actively employed (physically working and earning salary) as of July 1, 2001, nor on a school board approved leave of absence through that date. As such, you must return to active employment, to earn one additional year of service credit, before you will be vested in the Florida Retirement System and eligible for retirement benefits. I have enclosed a copy of the FRS Retirement Guide for the Regular Class for your information. Please call or write if you have any further questions. In February of 2002, Petitioner again made contact with School Board personnel and "was told that [his] name [had been] removed from the computer (school records)." In July of 2002, Petitioner wrote United States Senator Bob Graham "seeking [Senator Graham's] assistance in helping [Petitioner] get [his] retirement form Miami-Dade Public Schools." Petitioner's letter to Senator Graham was referred to the School Board's Superintendent of Schools, who responded by sending the following letter, dated August 29, 2002, to Petitioner: Your letter . . . to Senator Bob Graham was referred to me for response. A review of our records indicates that your earnings as a part-time teacher ended in July 2000. As a part-time employee, you were not eligible for a Board-approved leave of absence. You were notified by letter (copy attached) dated August 22, 2001 from Ms. Lisa Skovalia, Benefits Specialist, State of Florida, Division of Retirement, that because ". . . you were neither actively employed (physically working and earning salary) as of July 1, 2001, nor on a school board approved leave of absence through that date," you would have to return to active employment and earn one additional year of service credit before being vested in the Florida Retirement System. The State of Florida Division of Retirement is solely responsible for developing rules and procedures for implementing changes in the retirement law. If you disagree with their determination, you may request an administrative hearing by sending a written request to the Bureau of Retirement Calculations, Cedars Executive Center, 2639 North Monroe Street, Building C, Tallahassee, Florida 32399. On September 12, 2002, Petitioner sent a letter to the Division's Bureau of Retirement Calculations (Bureau) "seeking [its] assistance in helping [him] get [his] retirement from Miami-Dade Public Schools." The Bureau responded to Petitioner's letter by providing him with the following Statement of Account, dated September 20, 2002: We audited your retirement account and you have 7.10 years of service through 07/2000. Please note that the vesting requirement for FRS members has been changed to 6 years of creditable service effective July 1, 2001 for those members who were actively employed on that date or on a board approved leave of absence. Former members with 6 years, but less than 10 years of creditable service who were not employed with a participating FRS employer on July 1, 2001, must return to covered employment for one year to become eligible for the six-year vesting provision. Per Maria Perez at the Miami-Dade County School Board you were not on a board approved leave of absence on July 1, 2001, nor were you eligible for a board approved leave of absence due to your position as a part time adult school instructor. Although your school may have allowed you to take a leave of absence, only board approved leaves fulfill the vesting requirements required by law. On November 15, 2002, Petitioner sent the Bureau a letter expressing the view that it was not "fair that, after all [his] efforts as a teacher, [he] should lose out [on his] retirement" and requesting "an administrative hearing concerning [his] efforts to get retirement benefits from Miami-Dade Public Schools." The State Retirement Director responded to Petitioner's letter by sending him the following letter, dated December 18, 2002: This is in response to your recent letter concerning your vesting and eligibility for retirement benefits. You currently have 7.10 years of retirement credit through July 2000, your last month of employment in a Florida Retirement System (FRS) covered position. [Section] 121.021(45)(b)1, F.S., states that "Any member employed in a regularly established position on July 1, 2001, who completes or has completed a total of 6 years of creditable service shall be considered vested. . ." An FRS employer (Dade School Board) last employed you in a regularly established position in July 2000 and you were not granted a leave of absence to continue the employment relationship. Dade School Board has informed us that as a part-time teacher, you were not eligible for an approved leave of absence. Therefore, you do not meet the statutory requirement for coverage under the six year vesting provision. [Section] 121.021(45)(b)2, F.S., provides the vesting requirement for members who were not employed on July 1, 2001, as follows: "Any member not employed in a regularly established position on July 1, 2001, shall be deemed vested upon completion of 6 years of creditable service, provided that such member is employed in a covered position for at least 1 work year after July 1, 2001 (emphasis supplied). It is certainly unfortunate that you had to leave your employment because of your illness, but the current retirement law requires that you must return to covered employment and earn one year of service credit to be vested and eligible for retirement benefits. This letter constitutes final agency action. If you do not agree with this decision and wish to appeal this action, you must file a formal petition for review in accordance with the enclosed Rule 28-106.201, Florida Administrative Code (F.A.C.) within 21 days of receipt of this letter. Your petition should be filed with the Division of Retirement at the above address. Upon receipt of the petition, you will be notified by the Division or the Administrative Law Judge of all future proceedings and hearings. If you do not file an appeal within the 21-day period, you will waive your right to request a hearing or mediation in this matter in accordance with Rule 28-106.111, F.A.C. By letter dated January 2, 2003, Petitioner "appeal[ed]" the "final agency action" announced in the State Retirement Director's December 18, 2002, letter.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Division issue a final order finding that Petitioner is not "vested," as that term is defined in Subsection (45) of Section 121.021, Florida Statutes. DONE AND ENTERED this 31st day of March, 2003, in Tallahassee, Leon County, Florida. STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 31st day of March, 2003.
The Issue Whether the Department of Management Services, Division of Retirement (“the Department”) should be equitably estopped from requiring Michael A. Fewless to return $541,780.03 of retirement benefits.
Findings Of Fact The following findings are based on witness testimony, exhibits, and information subject to official recognition. FRS and the Termination Requirement FRS is a qualified plan under section 401(a) of the Internal Revenue Code and has over 500,000 active pension plan members. The Department administers FRS so that it will maintain its status as a qualified pension plan under the Internal Revenue Code. Section 121.091(13), Florida Statutes (2018),1/ describes the benefits available to FRS members through the “Deferred Retirement Option Program (“DROP”): In general, and subject to this section, the Deferred Retirement Option Program, hereinafter referred to as DROP, is a program under which an eligible member of the Florida Retirement System may elect to participate, deferring receipt of retirement benefits while continuing employment with his or her Florida Retirement System employer. The deferred monthly benefits shall accrue in the Florida Retirement System on behalf of the member, plus interest compounded monthly, for the specified period of the DROP participation, as provided in paragraph (c). Upon termination of employment, the member shall receive the total DROP benefits and begin to receive the previously determined normal retirement benefits. Section 121.091 specifies that “[b]enefits may not be paid under this section unless the member has terminated employment as provided in s. 121.021(39)(a). ” Section 121.021(39)(a) generally provides that “termination” occurs when a member ceases all employment relationships with participating employers. However, “if a member is employed by any such employer within the next 6 calendar months, termination shall be deemed not to have occurred.” § 121.021(39)(a)2., Fla. Stat. Moreover, the employee and the re-employing FRS agency will be jointly and severally liable for reimbursing any retirement benefits paid to the employee. § 121.091(9)(c)3., Fla. Stat.2/ The termination requirement is essential to the FRS maintaining its status as a qualified plan under IRS regulations. As a qualified plan, taxes on FRS benefits are deferred.3/ The Department’s position is that after an entity becomes a participating employer, all new hires within covered categories are “compulsory members” of the FRS. If an entity has a local pension plan, then that entity must either close the plan before joining FRS or keep the plan open for members who exercise their right to remain in that plan. However, even if the entity chooses to keep the local plan open for current members, the local plan is closed to new members. The City of Fruitland Park, Florida (“Fruitland Park”), became an FRS employer on February 1, 2015. The mayor and commissioners of Fruitland Park passed a resolution on November 20, 2014, providing in pertinent part, that: It is hereby declared to be the policy and purpose of the City Commission of Fruitland Park, Florida that all of its General Employees and police officers, except those excluded by law, shall participate in the Florida Retirement System as authorized by Chapter 121, Florida Statutes. All General Employees and police officers shall be compulsory members of the Florida Retirement System as of the effective date of participation in the Florida Retirement System so stated therein. (emphasis added). The Department notified Fruitland Park during its enrollment into FRS that all new hires were compulsory members of FRS for covered groups. Facts Specific to the Instant Case After graduating from the Central Florida Police Academy in 1985, Mr. Fewless began working for the Orange County Sheriff’s Office (“OCSO”) as a deputy sheriff and patrolled what he describes as “the worst area of Orange County.”4/ After five years, Mr. Fewless transferred into the detective bureau in OCSO’s criminal investigations division. Mr. Fewless received a promotion to corporal two years later and returned to patrolling.5/ Mr. Fewless soon received a transfer to OCSO’s special investigation’s division and worked in the gang enforcement unit.6/ It was not long before he was promoted to sergeant and sent “back to the road.” After 10 months, OCSO asked Mr. Fewless to take over the gang enforcement unit where he was promoted to lieutenant and ultimately to captain.7/ During his tenure as a captain, Mr. Fewless was in charge of OCSO’s internal affairs unit for five or six years. Mr. Fewless concluded his nearly 30-year tenure with OCSO as the director of the Fusion Center and the Captain of the criminal intelligence section.8/ In sum, Mr. Fewless’s service with OCSO was exemplary, and he was never the subject of any disciplinary actions. Mr. Fewless entered the DROP program on June 1, 2011. As a result, he was scheduled to complete his DROP tenure and retire on May 31, 2016. On June 1, 2011, Mr. Fewless signed a standardized FRS document entitled “Notice of Election to Participate in the Deferred Retirement Option Program (DROP) and Resignation of Employment.” That document contained the following provisions: I elect to participate in the DROP in accordance with s. 121.091(13), Florida Statutes (F.S.), as indicated below, and resign my employment on the date I terminate from the DROP. I understand that the earliest date my participation in the DROP can begin is the first date I reach normal retirement date as determined by law and that my DROP participation cannot exceed a maximum of 60 months from the date I reach my normal retirement date, although I may elect to participate for less than 60 months. Participation in the DROP does not guarantee my employment for the DROP period. I understand that I must terminate all employment with FRS employers to receive a monthly retirement benefit and my DROP benefit under Chapter 121, F.S. Termination requirements for elected officers are different as specified in s. 121.091(13)(b)(4), F.S. I cannot add service, change options, change my type of retirement or elect the Investment Plan after my DROP begin date. I have read and understand the DROP Accrual and Distribution information provided with this form. Mr. Fewless realized by 2015 that he was not ready to leave law enforcement. However, he was scheduled to retire from OCSO by May 31, 2016. Mr. Fewless had several friends who left OCSO as captains and took police chief positions with municipalities in Florida. Therefore, in anticipation of a lengthy job search, he began looking for such a position in approximately March of 2015. Mr. Fewless applied to become Fruitland Park’s police chief on March 26, 2015, and was offered the job in June of 2015 by Fruitland Park’s city manager, Gary LaVenia. Mr. Fewless learned from Mr. LaVenia that Fruitland Park had joined FRS and told him that he could not work within the FRS system. Mr. LaVenia then erroneously told Mr. Fewless that he would not be violating any FRS conditions (and thus forfeiting his DROP payout) because Fruitland Park had a separate city pension plan into which Mr. Fewless could be enrolled. As noted above, Fruitland Park had passed a resolution mandating that “[a]ll General Employees and police officers shall be compulsory members of the Florida Retirement System as of the effective date of participation in the Florida Retirement System. ” While Mr. Fewless was pleased with what Mr. LaVenia told him, he called an FRS hotline on July 9, 2015, in order to verify that he would not be endangering his retirement benefits by accepting the police chief position with Fruitland Park. Mr. Fewless’s question was routed to David Kent, and Mr. Fewless described how he was going to work for Fruitland Park and that Fruitland Park was an FRS employer. Mr. Kent told Mr. Fewless that he could go to work for Fruitland Park immediately without violating any FRS requirements so long as he was not enrolled into the FRS system. Instead of being an FRS enrollee, Mr. Kent stated that Mr. Fewless could enroll into Fruitland Park’s pension plan or enter a third-party contract.9/ Mr. Fewless assumed that Mr. Kent was an FRS expert and remembers that Mr. Kent sounded very confident in the information he relayed over the telephone. On July 14, 2015, Mr. Fewless filled out and signed a form entitled “Florida Retirement Systems Pension Plan Deferred Retirement Option Program (DROP) Termination Notification.” The form indicates that Mr. Fewless would be ending his employment with OCSO on August 1, 2015. In addition, the form notified Mr. Fewless of the requirements associated with receiving his accumulated DROP and monthly benefits: According to our records, your DROP termination date is 08/01/2015. You must terminate all Florida Retirement System (FRS) employment to receive your accumulated DROP benefits and begin your monthly retirement benefits. You and your employer’s authorized representative must complete this form certifying your DROP employment termination. Termination Requirement: In order to satisfy your employment termination requirement, you must terminate all employment relationships with all participating FRS employers for the first 6 calendar months after your DROP termination date. Termination requirement means you cannot remain employed or become employed with any FRS covered employer in a position covered or noncovered by retirement for the first 6 calendar months following your DROP termination date. This includes but is not limited to: part-time work, temporary work, other personal services (OPS), substitute teaching, adjunct professor or non-Division approved contractual services. Reemployment Limitation: You may return to work for a participating FRS employer during the 7th – 12th calendar months following your DROP termination date, but your monthly retirement benefit will be suspended for those months you are employed. There are no reemployment limitations after the 12th calendar month following your DROP termination date. If you fail to meet the termination requirement, you will void (cancel) your retirement and DROP participation and you must repay all retirement benefits received (including accumulated DROP benefits). If you void your retirement, your employer will be responsible for making retroactive retirement contributions and you will be awarded service credit for the period during which you were in DROP through your new employment termination date. You must apply to establish a future retirement date. Your eligibility for DROP participation will be determined by your future retirement date and you may lose your eligibility to participate in DROP.[10/] (emphasis in original). Mr. Fewless’s Reliance on the Representations Made to Him Mr. Fewless placed complete trust in the representations made during his July 9, 2015, phone call to the FRS hotline and during his discussions with Fruitland Park’s city manager. When he left OCSO and accepted the police chief position with Fruitland Park, Mr. Fewless took a $33,000.00 annual pay cut and stood to receive $70,000.00 less from his DROP payout. It is highly unlikely he would have accepted those circumstances if he did not have a good faith basis for believing he was utilizing an exception to the termination requirement. In the months preceding his departure from OCSO, Mr. Fewless’s wife was being treated for a brain tumor. Following her surgery in May of 2015 and subsequent radiation treatment, Ms. Fewless returned to work for a month or two. However, given that the retirement checks Mr. Fewless had begun to receive were roughly equivalent to what Ms. Fewless had been earning, she decided to retire in order to spend more time with their grandchildren. During this timeframe, Mr. and Ms. Fewless decided to build their “dream home,” and Ms. Fewless designed it. They used a $318,000.00 lump sum payment from FRS to significantly lower their monthly house payment. Those actions would not have been taken if Mr. Fewless had suspected that there was any uncertainty pertaining to his retirement benefits. The Department Discovers the Termination Violation In November of 2017, the Department’s Office of the Inspector General conducted an audit to assess Fruitland Park’s compliance with FRS requirements. This audit was conducted in the regular course of the Department’s business and was not initiated because of any suspicion of noncompliance. The resulting audit report contained the following findings: (a) Fruitland Park had failed to report part-time employees since joining FRS; (b) Fruitland Park had failed to report Mr. Fewless as an employee covered by FRS; (c) Mr. Fewless’s employment with Fruitland Park amounted to a violation of FRS’s reemployment provisions; and (d) Fruitland Park failed to correctly report retirees filling regularly established positions. Because he had failed to satisfy the termination requirement, the Department notified Mr. Fewless via a letter issued on August 15, 2018, that: (a) his DROP retirement had been voided; (b) his membership in FRS would be retroactively reestablished11/; and (c) he was required to repay $541,780.03 of benefits. Mr. Fewless’s Reaction to Learning That He Had Violated the Termination Requirement Mr. Fewless learned on June 25, 2018, of the Department’s determination that he was in violation of the termination requirement. He responded on July 5, 2018, by writing the following letter to the Department: On the evening of, June 25, 2018, I was notified by Mr. Gary LaVenia, the City Manager for Fruitland Park, that he was contacted by members of the State of Florida’s DMS Inspector General’s office regarding a problem with my current retirement plan. No additional information was shared during this initial telephone conversation and we scheduled a meeting for the following day. On June 26, 2018, I met with Mr. Gary LaVenia, Ms. Diane Kolcan, Human Resource Director and Ms. Jeannine Racine, the Finance Director regarding this matter. I was advised that members of the Department of the Florida Retirement System told them that I was in violation of receiving my current retirement benefits because I failed to take a six month break between my retirement with the Orange County Sheriff’s Office and joining the City of Fruitland Park. I explained to them that there must be some mistake because I am not currently enrolled in the Florida Retirement System through the City of Fruitland Park. The City enrolled me in their “City” pension plan. Mr. LaVenia agreed with me and we closed the meeting with me advising them I would do some additional research on the matter. * * * I then reached out to Mr. Chris Carmody, an attorney with the Gray/Robinson Firm, whom I worked with on legislative issues in the past. . . . I explained to him that according to the Inspector General’s report, I needed to have a six month separation between the Orange County Sheriff’s Office and the City of Fruitland Park, because both agencies participated in the Florida Retirement System. Mr. Carmody still did not feel that was a violation because I was not enrolled in the FRS Plan with the City of Fruitland Park, but rather their independent City pension plan. I felt the same way; however he wanted to continue to research the issue. A few hours later I received a telephone call from Mr. Carmody indicating the problem appears to be that the “City” participates in the FRS Pension Plan and even though I do not, I would be prohibited from working there for the six month period. After hearing this news, I immediately contacted Ms. Amy Mercer, the Executive Director of the Florida Police Chief’s Association. I explained the dilemma to her and just like the previously mentioned individuals she said “so what did you do wrong, that sounds ok to me. ” Ms. Mercer said she would reach out to the two attorneys that support the Florida Police Chief’s Association to get their opinion of the situation. The following morning, Ms. Mercer advised me that according to Attorney Leonard Dietzen my actions were in violation of the Florida Retirement Pension Plan Rules. Mr. Dietzen explained to her that I needed a six month separation from my employment with the Florida Retirement System and the City of Fruitland Park, because the City participated in the FRS Pension plan. Therefore, based on the above information [and] the realization that an innocent mistake had been made, please let me explain my actions: * * * In either June or July of 2015, I officially interviewed for the position of Police Chief for the City of Fruitland Park. . . . Approximately one week after the interviews, I was offered the position of Police Chief for the City of Fruitland Park. In July of 2015, I contacted the official FRS Hotline regarding my potential decision to join the Fruitland Park Police Department. I informed them that I was currently employed with the Orange County Sheriff’s Office and enrolled in DROP. I advised them that I was considering accepting the position of police chief with the City of Fruitland Park; however I wanted to confirm with them that I would have no issues with my retirement. I explained that the City of Fruitland Park was currently an FRS department; however they also had a separate “City” pension plan which I was going to be placed in. I wanted to confirm that this would not negatively impact my retirement benefits. I was advised that as long as I was enrolled in the “City” pension plan, I would be fine. The FRS employee also added that he heard other “new chiefs” were doing an “independent contract” with the City for a one year period, but he assured me either way would be fine. I concluded my telephone conversation and proceeded forward. I then began the employee benefits negotiations process with Mr. LaVenia. At the time of the negotiations, I realized I would be receiving my Florida Retirement check on a monthly basis and my wife was also employed as the vice-president of the Orlando Union Rescue Mission in Orlando, Florida. Therefore money was not my primary concern for this position and I surrendered my much larger salary with the Orange County Sheriff’s Office to become the Chief of Police for Fruitland Park for $70,000 per year. I officially accepted the position with the City of Fruitland Park, and informed Mr. LaVenia that I could not participate in the Florida Retirement System; however according to the FRS Hotline employee I could be placed in the city pension plan or sign a contract for a one year period. Mr. LaVenia recommended that I be placed in the city pension plan and had the appropriate paperwork completed. * * * It is important to recognize that I felt I took all the necessary steps to act within the guidelines of the Florida Retirement System. After all, I had worked for over thirty years with the Orange County Sheriff’s Office with an impeccable record and with the intent of securing a retirement package that would protect my wife and family for life. In conclusion, I feel I have been let down by the system in two very key areas regarding this matter: In July 2015, not only was I preparing for retirement and a new job; but my wife was experiencing serious medical issues that required surgery and radiation treatments for months at Shands Hospital. Although my mind was focused on her condition, I still felt it was extremely important to contact the FRS Hotline regarding my potential new position. My desire was to make sure I did not do anything that would jeopardize the retirement plan I worked for my entire career. The advice I was given by the FRS Hotline employee/professional apparently was terrible. Not only did he indicate I could go under the “City” pension plan, he further recommended that other chiefs have decided to do a “contract” with the city for a one year period to account for the separation from the FRS system. Clearly had this employee indicated by any means that the position with Fruitland Park would or possibly could jeopardize my retirement, I would have run away from this opportunity . . . * * * In July and August of 2015, while I was completing the hiring process with the City of Fruitland Park, management and/or staff should have cautioned me about the potential risk to my Florida Retirement Pension if I proceeded with the process. * * * Clearly, whoever made the decision to proceed with processing me was unaware of two things. (1) I would be violating the six month separation rule if I stopped my employment with the Orange County Sheriff’s Office on August 1, 2015 and began employment with Fruitland Park one day later on August 2, 2015. (2) The only pension plan available to new employees with the City of Fruitland Park had to be the Florida Retirement System. * * * I now understand from going through this procedure that there [was] an unintended error in how I officially retired from the Orange County Sheriff’s Office and began my employment with the Fruitland Park Police Department. It is important to mention that Sheriff Kevin Beary and Sheriff Jerry Demings chose me to command their Professional Standards Division on two separate occasions because they knew I was a man of integrity and would always “do the right thing.” I had no intent to skirt the system and/or do anything unethical. I can assure you nobody raised a red flag over this position prior to this incident; and I would have immediately stopped my efforts had I been aware of this rule. Mr. Fewless’s Current Situation While working as Fruitland Park’s police chief, Mr. Fewless’s salary and retirement benefits totaled $12,000.00 a month. In order to avoid accumulating more penalties, Mr. Fewless retired from his police chief position with Fruitland Park on August 31, 2018. Mr. Fewless has not received any FRS benefits since September 1, 2018. There was a three-month period when he was receiving no money. Mr. Fewless has been employed by the Groveland Police Department since March 4, 2019. Mr. Fewless describes his current financial situation as “dire” and says he and his wife are “wiped out.” They may need to sell their “dream house,” and they borrowed $30,000.00 from their daughter in order to litigate the instant case. In addition, the contractor who built the Fewless’s dream home failed to pay subcontractors for $93,000.00 of work. While the Department notes that Mr. Fewless stands to receive a higher monthly benefit, he disputes that he is somehow in a better position: No, I am not in a better position. The $542,000 that will be taken away from me because of what clearly could have been handled with one phone call from a representative of FRS – the difference in pay between my former retirement salary and my new retirement salary based on the recalculations will go from $6,000 to $7,000 a month. That means in order for me to recoup the $542,000 that the state was referring to, I would have to work 542 months. I don’t think I’ll live that much longer, No. 1. And No. 2, that doesn’t take into consideration interest and everything else that was part of that, if that makes sense. Mr. Fewless has filed a lawsuit against Fruitland Park. Ultimate Findings of Fact12/ Mr. Fewless’s testimony about his July 9, 2015, phone call to the FRS hotline is more credible than Mr. Kent’s. Mr. Fewless’s descriptions of that phone call are very consistent, and the Department has not directed the undersigned to any instances in which an account of that phone call by Mr. Fewless differed from his testimony or his July 5, 2018, letter to the Department.13/ This finding is also based on Mr. Fewless’s demeanor during the final hearing. Moreover, Mr. Fewless was not attempting to “game the system.” Given Mr. Fewless’s exceptional record of public service, it is very unlikely that he would knowingly and intentionally attempt to engage in “double dipping” by violating the termination requirement. It is equally unlikely that Mr. Kent can accurately remember what he told Mr. Fewless during a single phone call on July 9, 2015. Rather than questioning Mr. Kent’s veracity, the undersigned is simply questioning his ability to recall the content of a single phone call that appears to have been unremarkable.14/ It is also difficult to believe that Mr. Fewless would accept the police chief position with Fruitland Park and build an expensive “dream house” after being told by Mr. Kent that he would be violating the termination requirement.15/ Mr. Fewless’s reliance on Mr. Kent’s statement was entirely reasonable given that the arrangement described by Mr. LaVenia sounded like an imminently plausible exception to the termination requirement. Mr. Fewless’s subsequent actions in reliance of that statement were extremely detrimental to himself and his family. Finally, the circumstances of the instant case are analogous to other cases in which appellate courts have held that the enhanced requirements for estopping the government had been satisfied. In other words, Mr. Kent’s misrepresentation amounted to more than mere negligence, the Department’s proposed action would result in a serious injustice, and the public interest would not be unduly harmed by Mr. Fewless retaining the retirement benefits he earned through his public service with OCSO.
Conclusions For Petitioner: Ryan Joshua Andrews, Esquire Brian O. Finnerty, Esquire Johana E. Nieves, Esquire The Law Offices of Steven R. Andrews, P.A. 822 North Monroe Street Tallahassee, Florida 32303 For Respondent: Thomas E. Wright, Esquire Sean W. Gillis, Esquire Office of the General Counsel Department of Management Services Suite 160 4050 Esplanade Way Tallahassee, Florida 32399
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services, Division of Retirement, enter a final order rescinding its proposed action that Michael A. Fewless’s FRS DROP retirement be voided and that he be required to repay all retirement benefits as provided in Florida Administrative Code Rule 60S- 4.012. DONE AND ENTERED this 18th day of July, 2019, in Tallahassee, Leon County, Florida. S G. W. CHISENHALL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of July, 2019.
The Issue Whether the purported selection of Option 2 for payment of Florida Retirement System disability retirement benefits to Lon Emory Sweely, now deceased, and his beneficiary, the Petitioner, Richard A. Castillo, Jr., was valid and effective.
Findings Of Fact On or about June 20, 1990, Lon Emory Sweely executed a Division of Retirement Form FR-13 Florida Retirement System Application for Disability Retirement. The application indicated that Sweely's disability resulted from AIDS-related conditions. It selected Option 1, which the application designates as the "Maximum Benefit" and describes as follows: Full benefits payable to the member for his lifetime. If death occurs before the total benefits paid to member equals the contributions made, the difference, if any, is refunded to beneficiary in a lump sum payment. In so doing, Sweely rejected Option 2, which the application designates as "Ten Years Certain," and describes: Lifetime benefit to member, but not less than 120 monthly payments to someone. A decreased retirement benefit payable to a member during his lifetime, and in the event of his death with a period of ten (10) years after his retirement, the same monthly amount shall be payable for the balance of such ten (10) year period to his beneficiary, or in case the beneficiary is deceased, in accordance with Section 121.091(3), Florida Statutes, as though no beneficiary has been named. The application, also designated the Petitioner, Richard A. Castillo, Jr., as Sweely's sole beneficiary. (Sweely previously had designated the Petitioner as his beneficiary, with the Petitioner's mother as the first contingent beneficiary, on a Division of Retirement Personal History Record Form FRS-M10 (Revised 3/89) executed by Sweely on January 25, 1990.) At the time of Sweely's application for disability retirement, Sweely knew that he had full-blown AIDS and that his life expectancy would have to be estimated at approximately two years or less. There also is evidence that Eulah Lee McWilliams, the principal at the elementary school where Sweely taught, counseled Sweely on his options and advised Sweely to select the "Ten Years Certain" option. It is clear that Sweely wanted the Petitioner, and no one else, to be his sole beneficiary and to be provided for after his death in the manner and to the extent to which he decided. McWilliams believed that Sweely wanted the Petitioner to have the benefits of the "Ten Year Certain" Option 2. Based on their conversations, McWilliams believed that Sweely concurred with her recommendation in order to provide the maximum possible benefit to the Petitioner upon Sweely's death. But, in the face of Sweely's knowledge and McWilliams's advice and understanding, the application indicates that Sweely selected Option 1. There was evidence that the Petitioner was present and assisting Sweely when the Form FR-13 was executed and that the Petitioner filled out part of the form at Sweely's direction, as writing was inconvenient and difficult for Sweely at the time. But there was no evidence that Sweely was unable to make informed decisions when he executed Division of Retirement Form FR-13 on or about June 20, 1990. The evidence also did not prove that Sweely's choice of Option 1 was inadvertent error. At that point in time, Sweely may have wanted to be optimistic and to be able to enjoy and share with the Petitioner the maximum possible monthly benefit for as long as Sweely lived. McWilliams testified that, at the time, Sweely was trying to remain "up-beat" concerning his illness, in part thinking that this might extend his lifetime. A decision to choose Option 1, contrary to McWilliams's recommendation, also would not have been inconsistent with an earlier decision by Sweely in April, 1990, (this time in conformance with McWilliams's recommendation) to postpone applying for retirement benefits until he exhausted all of his accumulated fully-paid sick leave. Had Sweely died while on sick leave, the Petitioner would not have received the additional retirement benefits he is seeking in this case. (It is not clear from the record exactly what the benefits would have been, but it seems that the Petitioner would not have been entitled to any of the additional retirement benefits he is seeking in this case. Cf. Section 121.091(7), Fla. Stat. (Supp. 1990); F.A.C. Rule 60S-4.008.) A little over a month later, Sweely's condition worsened, and on or about August 14, 1990, he had to be hospitalized again (as already had happened from time to time during Sweely's full-blown AIDS.) On or about August 15, 1990, the Division of Retirement approved Sweely's application for disability retirement, effective July 1, 1990. On the same date, the Division of Retirement also sent Sweely a Division of Retirement Form FST-40c (R5/89) Acknowledgement of Retirement Application and a blank FRS- 11o "Option Selection Form for FRS Members." The Form FST-40c (R5/89) requested that Sweely "review carefully how the option one and two are paid to your beneficiary." The descriptions of the options in the Form FRS-11o were somewhat different from those in the Form FR-13 application. Option 1 was not called the "Maximum Benefit," and it was described as follows: A monthly benefit payable for my lifetime. Upon my death, the monthy benefit will stop and my beneficiary will receive only a refund of any contributionss I have paid which are in excess of the amount I have received in benefits. This option does not provide a continuing benefit to my beneficiary. (Emphasis in the original.) Option 2 was not called "Ten Years Certain," and it was described as follows: A reduced monthly benefit payable for my lifetime. If I die before receiving 120 monthly benefit payments, my designated beneficiary will receive a monthly benefit payment in the same amount as I was receiving until the monthly benefit payments to both me and my beneficiary equal 120 monthly payments. No further benefits are then payable. The FRS-11o "Option Selection Form for FRS Members" also stated in bold and underlined upper case type: "MEMBER MUST SIGN AND DATE IN THE PRESENCE OF A NOTARY PUBLIC." Whenever Sweely was hospitalized, the emotional strain on the Petitioner increased, and the time spent with Sweely in the hospital left the Petitioner less time to accomplish normal household tasks. The Petitioner's life and home usually became disorganized during Sweely's hospitalizations, and the Petitioner often allowed mail to pile up at their home at these times. The Petitioner testified that, notwithstanding Sweely's hospitalization and its disruptive effect on his life and habits, he happened to collect and read the mail on August 16, 1990. He testified that among the items of mail he read that day was the envelope postmarked the day before in Tallahassee, Florida, containing the Division of Retirement Form FST-40c (R5/89) Acknowledgement of Retirement Application and the blank FRS-11o "Option Selection Form for FRS Members." The Petitioner testified that he telephoned McWilliams to discuss the forms with her, and she asked him to bring them to the hospital. He testified, and she confirmed, that she met with the Petitioner at the hospital, looked at the forms, and explained them to the Petitioner. Believing, based on the conversations she had with Sweely before June 20, 1990, that Option 2 was Sweely's actual choice, McWilliams advised the Petitioner to choose Option 2. McWilliams testified that she discussed the matter with Sweely and with the Petitioner in Sweely's presence on August 16, 1990. (It certainly is possible that, had they discussed the matter with Sweely on August 16, 1990, Sweely might have chosen Option 2 at that time.) But the Petitioner testified that they did not discuss the matter with Sweely on August 16, 1990. The Petitioner explained that, although Sweely was oriented and physically able to write his name and, from time to time, was mentally lucid on that day, the Petitioner did not think that Sweely was in a position to give full consideration to the matter at the time they were discussing the forms because he was on morphine, was lethargic, and was having difficulty breathing without a non-rebreather mask. The Petitioner also did not think it was necessary to trouble Sweely with the matter, since the Petitioner believed that the selection of Option 2 on the Form FRS-11o was redundant and also that he was authorized to execute the form for Sweely as his attorney-in-fact under a purported durable power of attorney which Sweely executed on or about February 28, 1990, authorizing the Petitoner to act in Sweely's behalf in all matters. Under the circumstances on the afternoon of August 16, 1990, the Petitioner did not think that Sweely would have wanted to be troubled with the matter unnecessarily. He checked Option 2 and signed Sweely's name to the Form FRS-11o. On numerous previous occasions, the Petitioner had signed Sweely's name on Sweely's personal checks to pay Sweely's bills. In doing so, the Petitioner believed that he was acting properly under the authority of the purported durable power of attorney, and the bank always honored the checks the Petitioner signed this way. But on June 13, 1990, a physician insisted that the Petitioner sign a Division of Retirement medical records release form FR-13b in his own name as attorney-in-fact for Sweely. Himself not thinking well or clearly under the circumstances, the Petitioner assumed that his signature on the Form FRS-11o was valid. The Petitioner testified that it did not occur to him that there were notary services available for his use at the hospital. He testified that, after checking Option 2 and signing the Form FRS-11o, he telephoned his father, who was a notary, and asked him to come to the hospital to notarize something for him. The Petitioner's father confirmed this and also confirmed the Petitioner's testimony that they met in the hallway outside Sweely's hospital room, where the Petitioner gave his father the signed form and asked him to notarize it. Both testified that they did not discuss the form in any detail before the Petitioner returned to Sweely's hospital room. The Petitioner's father testified that he notarized the form thinking that Sweely had signed it. Sweely died two days later on August 18, 1990.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Management Services, Division of Retirement, enter a final order: (1) that the purported selection, on the Form FRS-11o dated August 16, 1990, of Option 2 for payment of Florida Retirement System disability retirement benefits to Lon Emory Sweely, now deceased, and his beneficiary, the Petitioner, Richard A. Castillo, Jr., was invalid and ineffective; and (2) that the previous selection of Option 1 on the Form FR-13 executed on or about June 20, 1990, is valid and shall be given effect. RECOMMENDED this 20th day of January, 1995, in Tallahassee, Florida. J. LAWRENCE JOHNSTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of January, 1995. APPENDIX TO RECOMMENDED ORDER To comply with the requirements of Section 120.59(2), Fla. Stat. (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. 1.-9. Accepted and incorporated to the extent not subordinate or unnecessary. Last sentence, rejected as not proven. Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. Last sentence, rejected as subordinate to facts not proven and as hearsay insufficient in itself to support a finding. (Taking as true that Sweely made such a statement to the Petitioner, his actions were not in accordance with the statement.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. 12.-14. Accepted and incorporated to the extent not subordinate or unnecessary. Last sentence, rejected as subordinate to facts not proven and as hearsay insufficient in itself to support a finding. (Taking as true that Sweely made such a statement to McWilliams, his actions were not in accordance with the statement, and McWilliams also testified that Sweely tried to remain "up-beat," thinking that this might extend his lifetime.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. (Specifically, it was clear that Sweely wanted the Petitioner, and no one else, to be his sole beneficiary and to be provided for after his death in the manner and to the extent to which he decided.) Last sentence, not proven (as to expression of "clear and unqualified acknowledgment and understanding); also rejected as subordinate to facts not proven and as hearsay insufficient in itself to support a finding. (Taking as true that Sweely made such a statement to McWilliams, his actions were not in accordance with the statement, and McWilliams also testified that Sweely tried to remain "up-beat," thinking that this might extend his lifetime.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. (Specifically, it was clear that Sweely wanted the Petitioner, and no one else, to be his sole beneficiary and to be provided for after his death in the manner and to the extent to which he decided.) 17.-30. Accepted and incorporated to the extent not subordinate or unnecessary. 31. "Substantially," rejected as not proven. Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. 32.-35. Accepted and incorporated to the extent not subordinate or unnecessary. Respondent's Proposed Findings of Fact. 1.-7. Accepted and incorporated to the extent not subordinate or unnecessary. Ultimate and penultimate sentences, rejected in part as contrary to facts found and to the greater weight of the evidence. (The evidence was that the Patient Care Technician Records were prepared near the beginning of each nursing shift and reflected conditions at that time. Meanwhile, there was evidence that the patient's mental state would "wax" and "wane." When the patient "waned" and was lethargic, it was difficult to communicate with him. Changes during the course of a shift may or may not be noted in the Progress Notes. While the Patient Care Technician Records indicate that the patient was both oriented and lethargic, the 8 a.m. progress notes indicate "lethargic at times." The progress notes also indicate that, earlier in the day, the patient had difficulty breathing without the non-rebreather mask and that, by 2 p.m., he was wearing the mask continuously. Even disregarding the possibility that the morphine dosage was enough to affect his judgment, the patient's lethargy and his difficulty breathing without the mask probably would have made it difficult for him to communicate on legal matters on the afternoon of August 16, 1990.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. Ultimate and penultimate sentences, rejected in part as contrary to facts found and to the greater weight of the evidence. (He did not allege that Sweely could not communicate or write his name. He testified that he did not think Sweely would have been able to think clearly or want to be troubled with the form unnecessarily. He did not think he had to discuss it with Sweely or have Sweely sign it.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. Accepted and incorporated to the extent not subordinate or unnecessary. However, Dr. Breen's curt medical evaluation of Sweely's general medical condition on August 16, 1990, was not for the purpose of evaluating whether it was possible or prudent to have him considering legal documents and making important legal judgments. In addition, Dr. Breen saw the patient early in the morning and would not have seen changes during the course of the day. 11.-12. Accepted and incorporated to the extent not subordinate or unnecessary. 13. Rejected as contrary to the greater weight of the evidence that Castillo, Jr., "insist[ed] that Sweely was incompetent, unable to provide or receive meaningful communication on August 16--and could not execute the form himself . . .." (Rather, he testified that he did not think Sweely would have been able to think clearly or want to be troubled with the form unnecessarily.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. 14.-16. Accepted and incorporated to the extent not subordinate or unnecessary. COPIES FURNISHED: Keith F. Roberts, Esquire 201 North MacDill Avenue Tampa, Florida 33609 Robert B. Button, Esquire Department of Management Services Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 A. J. McMullian, III, Director Department of Management Services Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 William H. Lindner, Secretary Department of Management Services Knight Building, Suite 307 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950 Paul A. Rowell, Esquire General Counsel Department of Management Services Knight Building, Suite 312 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950
