May 15, 2008
IN THE MATTER OF JAMES CAMPBELL, PERS #637350.
On appeal from the Board of Trustees, Public Employees' Retirement System, Department of Treasury.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE COMMITTEE ON OPINIONS
Argued: April 16, 2008
Before Judges Lisa and Simonelli.
Appellant the Estate of James Campbell (Estate) appeals from the May 17, 2007 Final Administrative Determination of respondent Division of Pensions and Benefits (Division), Board of Trustees (Board) of the Public Employees' Retirement System (PERS). We affirm.
On June 1, 1983, James Campbell (James) began working for the Jersey City Housing Authority (Housing Authority) and became a member of PERS. On June 24, 1983, James executed a PERS enrollment application (the application) designating his then wife, Mary Campbell (Mary), and his mother, Geneva Campbell (Geneva), as beneficiaries of his death benefits. The application provided that upon the policyholder's death, the named beneficiaries would "[s]hare and share alike, survivor or survivors."
James and Mary divorced in 1992. Mary died on October 18, 1996. James married Rose Campbell (Rose) on August 14, 1994. James died on October 28, 2005. Rose claims that James submitted a change of beneficiary form to the Housing Authority designating her as the sole beneficiary of his death benefits.
The Estate's attorney, Neil E. Brunson, Esq. (Brunson), acting on Rose's behalf, contacted the Division about James' death benefits. The Division advised Brunson that Rose was not the designated beneficiary and that the Division had not received a change of beneficiary form. Brunson then contacted the Housing Authority requesting a copy of the change of beneficiary form, but the Housing Authority had no record of it.
Rose appealed the designation of Mary and Geneva as the beneficiaries of the death benefits.
The Division sent the Housing Authority an Employer's Certification of Death Form and advised that it would process the benefits to the designated beneficiary upon receipt of the completed form. The Housing Authority returned the completed form, which listed April 30, 2004 as the last employer contribution to James' pension, and May 6, 2004 as his last day of active service. Since James was not employed by the Housing Authority at the time of his death, his beneficiaries were only entitled to his pension benefit.
The Division notified Mary and Geneva that they were entitled to the pension benefit, and notified Brunson it had placed the claim in "contested" status. Brunson then notified the Division that Mary was deceased and that Geneva wished to renounce her claim to the pension benefits because she believed James' intent, prior to his death, was to execute a change of beneficiary form designating Rose as sole beneficiary.
The Division determined that Geneva was entitled to the entire pension benefit of $48,987.76, and that it would be paid to her unless she submitted a waiver form renouncing her interest. The Division also notified Geneva that she was entitled to the entire benefit, and that it was subject to a final audit by Prudential and the Pension System Actuary.
On or about March 24, 2006, Brunson requested that the matter be transferred to the Office of Administrative Law (OAL). A Deputy Attorney General (DAG) then notified Geneva that Rose contested her interest in the pension benefit; that Rose had asserted that Geneva wanted to renounce her interest; and that if Geneva wanted to do so, she had to contact the DAG. Geneva never responded.
The matter was then referred to the Board for consideration. The DAG advised Brunson that the Board's determination would be governed by N.J.S.A. 43:15A-57.1 and Estate of Boyle v. Board Of Trustees, 234 N.J. Super. 93 (App. Div. 1989), and that the Division never received a change of beneficiary form.
The Board also notified Brunson that it would consider the matter at its May 17, 2006 meeting, and invited him to attend. Prior to the meeting, Brunson submitted an undated, un-notarized affidavit purportedly signed by Geneva, stating that it was James' intent to make Rose his sole beneficiary after their marriage; that Geneva did not object to the change; that she renounced all claims to the pension funds; and that she directed that the funds be issued in Rose's name or be distributed to the Estate.
The Board considered the affidavit and a statement made by Brunson on Rose's behalf. On or about May 18, 2006, the Board notified Brunson that it denied the appeal pursuant to N.J.S.A. 43:15A-57.1 because the only beneficiary designation form the Division had on file was the one naming Mary and Geneva as beneficiaries; the Division never received a change of beneficiary form; Geneva's affidavit was not dated or notarized; and Geneva did not notify the Division of her desire to renounce. The Board also notified Brunson as follows:
[I]f you disagree with the determination of the Board, you may appeal by submitting a written statement to the Board within 45 days after the date of written notice of the determination. The statement shall set forth in detail the reasons for your disagreement with the Board's determination and shall include any relevant documentation supporting your claim. If no such written statement is received within the 45-day period, the determination by the Board shall be final.
The Board shall determine whether to grant an administrative hearing based upon the standards for a contested case hearing set forth in the Administrative Procedure Act, N.J.S.A. 52:14B-1 and the Uniform Administrative Procedure Rule, [N.J.A.C. 1:1-1 to -21.6]. Administrative hearings shall be conducted by the [OAL] pursuant to the provisions of [N.J.S.A. 52:14B-1 to -25] and N.J.A.C. 1:1-1.
If the granted appeal involves solely a question of law, the Board may retain the matter and issue a final determination, which shall include detailed findings of fact and conclusions of law based upon the documents, submissions and legal arguments of the parties. The Board's final determination may be appealed to the Superior Court, Appellate Division. If the granted appeal involves a question of facts, the Board shall submit the matter to the [OAL].
No appeal was filed within the forty-five day deadline.
On or about January 23, 2007, Brunson submitted to the Division a photocopy of a Group Insurance Certificate Change Form used by Boston Mutual Life Insurance Company, which James executed on August 18, 1994, and which designated Rose a sole beneficiary. Brown asserted that this form evidenced James' intent to change his beneficiary. The Division notified Brunson that the form was unacceptable pursuant to N.J.S.A. 43:15A-57.1 because it was not the proper form and it was not filed with PERS. The Division also gave Brunson a waiver form for Geneva to complete and return to the Division. Geneva never returned the form.
Brunson filed an appeal on or about March 14, 2007, and requested a hearing before the OAL. The Board advised him that it would consider the request at its meeting on April 18, 2007, and invited him to attend.*fn1 On April 18, 2007, the Board denied the request pursuant to N.J.A.C. 17:1-1.3 because Brunson failed to appeal within the forty-five day period; because the Boston Mutual form was not the proper form as Boston Mutual was not PERS' insurance carrier in 1994; and because no new factual information was provided. The Board also denied the request "essentially for the reasons set forth in [its] denial letter of May 18, 2006." In a Final Administrative Determination, dated May 17, 2007, the Board set forth detailed factual findings and conclusions of law supporting its decision. This appeal followed.
In agency proceedings, a claimant must establish his or her case by a preponderance of the evidence. In re Polk, 90 N.J. 550, 560 (1982). Once an administrative agency has issued a final decision, our "'review of that decision is a limited one.'" In re Taylor, 158 N.J. 644, 656 (1999) (quoting Clowes v. Terminix Int'l, Inc., 109 N.J. 575, 587 (1988)). The scope of review of an administrative decision "is the same as that [for] an appeal in any non-jury case, i.e., 'whether the findings made could reasonably have been reached on sufficient credible evidence present in the record,' considering 'the proofs as a whole,' with due regard to the opportunity of the one who heard the witnesses to judge of their credibility." Close v. Kordulak Bros., 44 N.J. 589, 599 (1965) (quoting State v. Johnson, 42 N.J. 146, 162 (1964)). We "may not 'engage in an independent assessment of the evidence as if [we] were the court of first instance[,]'" Taylor, supra, 158 N.J. at 656 (quoting State v. Locurto, 157 N.J. 463, 471 (1999)), and we will reverse only if the agency's decision "is arbitrary, capricious or unreasonable or it is not supported by substantial credible evidence in the record as a whole." Id. at 657 (quoting Henry v. Rahway St. Prison, 81 N.J. 571, 581 (1980)).
Based upon our review of the record, we are satisfied that the Board's decision is amply supported by substantial credible evidence in the record, and we discern no reason to disturb it. N.J.S.A. 43:15A-57.1 mandates that:
The designation of beneficiary by a member or retirant shall be made in writing on a form satisfactory to the retirement system, and filed with the retirement system. The member or retirant may, from time to time and without the consent of his death benefit designee, change the beneficiary by filing written notice of the change with the system on a form satisfactory to it. The new nomination will be effective on the date the notice, in proper form, is received by the system, and any prior nomination shall thereupon become void. [Emphases added.]
We have held "that the language of N.J.S.A. 43:15A-57.1 is unambiguous" in requiring that changes of beneficiaries be filed in writing with the Division. Estate of Boyle, supra, 234 N.J. Super. at 97. There is no question that James did not file written notice of a change of beneficiary with PERS or the Housing Authority on a form satisfactory to PERS.
There also is no question that the Estate did not provide competent evidence of Geneva's alleged renunciation of the pension benefit. Geneva's alleged affidavit is hearsay. Although hearsay is admissible in administrative proceedings, in reaching a final determination, "'a residuum of legal and competent evidence [must exist] in the record to support [that decision].'" Dolan v. City of E. Orange, 287 N.J. Super. 136, 145 (App. Div. 1996) (quoting Weston v. State, 60 N.J. 36, 51, (1972)); see also N.J.A.C. 1:1-15.5(b). Because there was no legal, competent evidence supporting the affidavit, the Board properly rejected it.
The Board also appropriately determined that the request for a hearing was time-barred. A request for a hearing was not filed within forty-five days after the date of the written notice of the Board's decision. N.J.A.C. 17:1-1.3(b).
We also reject the Estate's argument that the Board was required to conduct a trial-like plenary hearing. An administrative agency has the power to determine whether a matter is contested and requires a hearing. N.J.S.A. 52:14F-7a; In re Pub. Serv. Elec. & Gas Co.'s Rate Unbundling, Stranded Costs and Restructuring Filings, 330 N.J. Super. 65, 118 (App. Div. 2000) (citing N.J.S.A. 52:14B-2(b)), aff'd, 167 N.J. 377 (2001), cert. denied sub nom. Co-Steel Raritan v. N.J. Bd. of Pub. Utils., 534 U.S. 813, 122 S.Ct. 37, 151 L.Ed. 2d 11 (2001). "An evidentiary hearing is mandated only when the proposed administrative action is based on disputed adjudicatory facts." In re Farmer's Mut. Fire Assurance Ass'n of N.J., 256 N.J. Super. 607, 618 (App. Div. 1992) (citing High Horizons Dev. Co. v. St. of N.J. Dep't of Transp., 120 N.J. 40, 49-50 (1990)). "Although requisite due process is required, informal procedures may satisfy that requirement as long as the parties had 'adequate notice, a chance to know opposing evidence, and to present evidence and argument in response.'" Pub. Serv. Elec. & Gas Co.'s Rate Unbundling, supra, 330 N.J. Super. at 120 (quoting High Horizons, supra, 120 N.J. at 53).
Here, the Estate had adequate notice, knowledge of the opposing evidence, and the opportunity to present evidence. The Estate presented no competent evidence creating disputed facts. Thus, not only was a hearing not required, a hearing would not have changed the outcome.
Finally, the Estate's argument that the Board unconstitutionally directed Rose's property right and interest in the pension benefit to a third party is without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). Because Rose was not James' designated beneficiary, she had no property right to his pension benefit.