Pension Forfeiture Statute, Resignation v. Termination

The Appeals court recently decided in ROBERT D. HERRICK vs. ESSEX REGIONAL RETIREMENT BOARD & another 77 Mass. App. Ct. 645 (2010) when and how the so called “Pension Forfeiture Statute” under G. L. c.32, § 10 is applied.

The court in deciding stated “A Superior Court judge, in reversing a decision of the Contributory Retirement Appeal Board denying the plaintiff employee’s application for a superannuation retirement allowance, correctly concluded that under G. L. c.32, § 10(1), the qualifying phrase “without moral turpitude” did not apply to the circumstances of the plaintiff’s application, where that phrase applied only to employees removed or discharged from employment [648-652]; moreover, the judge correctly concluded that the plaintiff’s resignation, seen as occurring under the threat of removal, did not amount to constructive removal within the meaning of the words “removed or discharged” in the statute [652-653]; finally, the judge correctly concluded that forfeiture of the plaintiff’s pension was not required under G. L. c.32, § 15(4). where there was no connection shown directly linking the plaintiff’s public position and the offense of which he was convicted.

Appeals from a Superior Court judgment that reversed the denial of Robert D. Herrick’s application for a superannuation retirement. ERRB denied Herrick’s application on the ground that he had forfeited his right to a pension due to “moral turpitude” as provided in G. L. c. 32, § 10(1). A magistrate in the Division of Administrative Law Appeals (DALA) upheld that decision. The Contributory Retirement Appeal Board (CRAB) affirmed in a divided decision, the majority stating that “the behavior attendant to Herrick’s resignation was moral turpitude,” and finding that the phrase “without moral turpitude” could not have been intended by the Legislature to be confined to “removed or discharged” employees. On cross motions for judgment on the pleadings, a Superior Court judge reversed on the ground that CRAB (and the other entities before it) had committed an error of law in their interpretation of c. 32, § 10(1). The judge also disagreed with the alternative ground argued by ERRB that Herrick’s pension was forfeited by operation of G. L. c. 32, § 15(4). Notwithstanding that this contention was raised for the first time in Superior Court, the judge considered it, nonetheless, for the sake of completeness. Because we agree that the statute in question does not permit the forfeiture of Herrick’s pension, the denial of his application for superannuation retirement benefits was error and must be reversed. Thus, we affirm the judgment.

Background. Briefly, at the time of his retirement, Herrick worked as a maintenance mechanic and custodian for the Wenham Housing Authority (Authority), and through that employment (and prior employment with the town of Hamilton) was a member of ERRB. On May 1, 2003, Herrick was charged with sexually assaulting his daughter. That same day he resigned his position with the Authority and, on May 6, 2003, submitted an application for voluntary superannuation retirement pursuant to G. L. c. 32, § 5. On May 15, 2003, he pleaded guilty to two counts of indecent assault and battery on a child and was sentenced to two and one-half years in jail, eighteen months of which to serve.
On June 27, 2003, ERRB denied Herrick’s application for retirement benefits. Herrick appealed from that decision. A hearing was conducted by a DALA magistrate on July 1, 2004, resulting in a decision affirming ERRB’s decision. Herrick then appealed from that decision to CRAB, which affirmed the denial of Herrick’s pension application, in a two-to-one decision. Herrick then sought timely judicial review in Superior Court, where both parties filed motions for judgment on the pleadings.

Discussion: G. L. c. 32, § 10(1). We turn first to the scope of the statute’s qualifying phrase “without moral turpitude.” Herrick contends that it applies only to the situation where a member of a public retirement system is “removed or discharged.” The basis on which ERRB denied Herrick’s pension application, a determination with which CRAB agreed, is that the phrase “without moral turpitude” modifies all applications for retirement, including those submitted after a member resigns. In a comprehensive and well-reasoned decision, the Superior Court judge disagreed with this interpretation, applying general principles of statutory construction and grammatical rules; she concluded that the qualifier “without moral turpitude” applied only to those removed or discharged from employment, not to all other antecedent phrases in the statute.
As expressed in Collatos v. Boston Retirement Bd., 396 Mass. 684 , 686 (1986) (citations omitted), “[a] statute designed to enforce the law by punishing offenders, rather than simply by enforcing restitution to those damaged, is in the nature of a penal statute. Forfeiture of property . . . is punitive.” “Penal statutes must be construed strictly ‘and not extended by equity,or by the probable or supposed intention of the legislature as derived from doubtful words; but that in order to charge a party with a penalty, he must be brought within its operation, as manifested by express words or necessary implication.’ ” Id. at 686-687, quoting from Libby v. New York, N.H. & H.R.R., 273 Mass. 522 , 525-526 (1930). “We examine the statute, therefore, particularly mindful that its words are not to be stretched to accomplish a result not expressed.” Collatos, supra at 687.

The logic of her interpretation becomes apparent when the use of the phrase “without moral turpitude” is examined in connection with the two means, provided by § 10(1), under which a member may be qualified to retire: (1) “after completing twenty or more years of creditable service,” and (2) “having attained age fifty-five.” In relation to the former, the situation when a member’s “office or position is abolished” is immediately antecedent to the phrase “without moral turpitude,” but abolishment of position is clearly unrelated to moral turpitude. This conclusion is compelled when compared to the latter “age fifty-five” retirement, since the phrase “removed or discharged from his office or position without moral turpitude on his part,” is followed by the phrase “or any such member whose office or position is abolished,” a situation that does not require that it be “without moral turpitude,” as such condition is not included. See note 2, supra.

Similarly, the judge’s interpretation that the phrase “without moral turpitude” relates only to “removed or discharged” is supported by her comparison of § 10(1) with § 10(2)(b 1/2 ). As she points out, the latter section, which pertains to an application for retirement benefits from a member who resigns after ten years of service, does not contain the phrase “without moral turpitude.” That “without moral turpitude” was intended to modify only “removed or discharged” is also evident from G. L. c. 32, § 10(2)(a), inserted by St. 2002, c. 184, § 46, which states that “[t]he retirement board shall require the employer of any employee applying for a termination retirement allowance to certify in writing, under the pains and penalties of perjury, that one of the following circumstances applies: (1) that the employee has failed of nomination or re-election, (2) that the employee has failed of reappointment, (3) that the employee’s office or position has been abolished, or (4) that the employee has been removed or discharged from his position without moral turpitude on his part.”

The Superior Court judge’s decision cited, and was consistent with, the only authority on point, two opinions from the Attorney General which recognized that retirement under the threat of removal is not the equivalent of removal or discharge under c. 32, § 10(1) or § 10(2). See Opinion of the Attorney General, Rep. A.G., Pub. Doc. No. 12, at 134-135 (1963); Opinion of the Attorney General, Rep. A.G., Pub. Doc. No. 12, at 172-174 (1977). Moreover, such an interpretation is consistent with a view supported by decisions of both the Supreme Judicial Court and this court, albeit in dicta. See Massachusetts Bay Transp. Authy. v. Massachusetts Bay Transp. Authy. Retirement Bd., 397 Mass. 734 , 739 (1986) (“there are laws of the Commonwealth which preclude the payment of retirement benefits to certain public employees who are discharged or convicted for misconduct in office. See G. L. c. 32, § 10[1] [1984 ed.]”); Brown v. Taunton, 16 Mass. App. Ct. 614 , 619 n.6 (1983) (“[w]e note . . . that the ‘moral turpitude’ provisions of G. L. c. 32, § 10(1), do not apply since the plaintiff was not ‘removed or discharged from his office’ “).

Threatened removal. ERRB contends additionally that Herrick’s pension can be forfeited because his resignation, seen as occurring under threat of removal, amounts to constructive removal. Technically, this misapplies the concept of constructive discharge to the facts of this case since Herrick’s motivation to leave his employ was not due to actions of the employer. GTE Prod. Corp. v. Stewart, 421 Mass. 22 , 34-35 (1995). More broadly, however, ERRB seeks to extend the meaning of “removed or discharged” to be able to reach members who retire under a cloud, in the face of possible or likely removal or discharge for reasons of criminal prosecution for offenses of moral turpitude.

Addressing a similar question, the Attorney General opined “that the term ‘removal or discharge’ is not so broad that it sweeps within the ambit of G. L. c. 32, § 10(2)(c), a resignation arguably tendered to forestall removal. It is a basic maxim of statutory construction that the words of a statute are to be read in accordance with their common and approved usage and are not to be stretched beyond their fair meaning in order to rationalize a particular result. The words ‘removal’ and ‘discharge’ connote an affirmative act by one’s employer and have a common usage significantly different from the word ‘resignation,’ which implies an act by the employee. Indeed the difference between the terms is apparent in the terms of G. L. c. 32, § 10, in which the words ‘removal or discharge’ and ‘resigns’ are repeatedly used to describe different situations. Since words used in different portions of a statute are ordinarily given the same meaning throughout, it would be an anomaly of statutory construction to extend the scope of G. L. c. 32, § 10(2)(c), to include resignations as well as removals, when they are made distinct by the immediately preceding language of § 10.” Opinion of the Attorney General, Rep. A.G., Pub. Doc. No. 12, at 173-174 (1977) (citations omitted). The same rationale can be applied to § 10(1).
To hold otherwise, and to permit “removed or discharged” to be stretched to accommodate the kind of “constructive” removal suggested by ERRB, would permit it to inquire into, evaluate, and weigh reasons that motivated the retirement of a member. Such an interpretation would invite decisions based not upon an identifiable record of proceedings that lead an employer to an objectively discernible removal of its employee, but instead upon subjective criteria that are prone to a range of ills that objective criteria are designed to prevent.

As suggested by the judge, ERRB’s reliance on DeLeire v. Contributory Retirement Appeal Bd., 34 Mass. App. Ct. 1 (1993), is misplaced. There, the member was suspended from his position and sentenced to prison prior to his attempted resignation. Accordingly, the position was considered vacant by operation of G. L. c. 279, § 30, and such “removal” or “discharge” was plainly with “moral turpitude.” Here, however, Herrick, resigned and applied for retirement prior to his conviction. Moreover, significant to the holding in DeLeire, but distinguishable from the case at bar, was the operation of G. L. c. 268A, § 25, which precludes payment of retirement benefits to certain suspended employees, and the court’s holding that the letter of resignation submitted in that case was not sufficient to end the employee’s suspension.
G. L. c. 32, § 15(4). ERRB also argues that forfeiture of Herrick’s pension is required pursuant to the provision of G. L. c. 32, § 15(4), which prohibits a member, “after final conviction of a criminal offense involving violation of the laws applicable to his office or position,” from receiving a pension. Herrick contends that his conviction was for an offense that did not apply to his position. In consideration of the cases that have interpreted § 15(4), we decide that this subsection does not apply to the circumstances of the instant case.
Similar to c. 32, § 10(1), § 15(4) has been held as penal in nature, thus strictly construed. Gaffney v. Contributory Retirement Appeal Bd., 423 Mass. 1 , 3 n.3 (1996). In Gaffney, supra at 4-5, the court stated that “[t]he substantive touchstone intended by the General Court [when it enacted G. L. c. 32, § 15(4),] is criminal activity connected with the office or position. Yet it is also apparent that the General Court did not intend pension forfeiture to follow as a sequelae of any and all criminal convictions. Only those violations related to the member’s official capacity were targeted. Looking to the facts of each case for a direct link between the criminal offense and the member’s office or position best effectuates the legislative intent of § 15(4).” (Emphasis supplied.) In State Bd. of Retirement v. Bulger, 446 Mass. 169 , 180 (2006), quoting from Gaffney, supra at 4, the court further described its decision in Gaffney as not limiting the application of § 15(4) to violations of ” ‘highly specialized crimes addressing official actions’ or even criminal conduct committed ‘in the course of [official] duties,’ but encompass [ing] ‘criminal activity connected with the office or position.’ ”
ERRB contends that Herrick’s sexual assault convictions are directly linked to his job as a custodian for the housing project because he had access to keys to the individual units. While the offenses in question are ones of moral turpitude, the record does not show that the offenses were connected with Herrick’s official capacity, nor does there appear to be the type of direct link intended by the Legislature, especially since the statute is construed narrowly because of its penal nature. Gaffney, supra at 3 n.3. Unlike the facts in Gaffney, or those in Maher v. Justices of the Quincy Div. of the Dist. Ct. Dept., 67 Mass. App. Ct. 612 , 616-617 (2006) (forfeiture under § 15[4] upheld when a city inspector was convicted of breaking and entering into city hall and stealing from his personnel file), S.C., 452 Mass. 517 (2008), a case relied upon by ERRB, the facts here do not present a connection or direct link to Herrick’s official position; without intending to minimize the offense, we observe that it was not committed upon anyone who was employed by or who resided at the public property, nor did it occur there. This lack of connection to Herrick’s position is significant, notwithstanding the recognition in Gaffney, supra at 3, that G. L. c. 32, § 15(4), was enacted “for an intermediate level of pension forfeiture in a broader array of circumstances” in reaction to the decision by the Supreme Judicial Court in Collatos, 396 Mass. at 687-688. In Collatos, supra, the Supreme Judicial Court construed G. L. c. 32, § 15(3A), to be limited by its plain terms to pension forfeiture for conviction of offenses under the listed State statutes, and not to reach a Federal cognate conviction. [Note 8] Nonetheless, a direct link between the public position and the offense for which the member is convicted must be shown, a connection which has not been shown here.
Conclusion. The pension forfeiture statute at issue is a penal provision that must be strictly construed and, when construed as such, it does not support ERRB’s interpretation of the statute or permit the denial of Herrick’s application for superannuation retirement benefits. Therefore, the denial of the application was erroneous. We must affirm the judgment.
So ordered.”

Commentary,

The case is a very good illustration of the statute and its application. The first factor decided by the court relates to how the statute applies. The key phrase used in the decision for the purposes of this statute is “Only those violations related to the member’s official capacity were targeted”, meaning only those relating to the position one held IE an employee of the state treasury that embezzles money. The other key factor by the court is the issue of when it applies, and the court in answering that stated “that phrase applied only to employees removed or discharged from employment” not those who resign.

Attorney Ronald A. Sellon

About Attorney Ronald A. Sellon

Ronald A. Sellon is a licensed Attorney in the state of Massachusetts and U.S. District Court, Massachusetts as well as a Sergeant with a Municipal Police Department and U.S. military Veteran. Additionally, he has taught Criminal Procedure at the Massachusetts State Police Academy in New Braintree and has written a text on Criminal Procedure for police field training officer programs. He is a graduate of the FBI National Academy, was a 2008 recipient of the Massachusetts Coalition of Police (Mass C.O.P.) Presidents award and holds a Bachelors Degree in Law Enforcement, a Masters Degree in Criminal Justice Administration, and a Juris Doctor Law Degree. Questions related to content material may be directed to RSellon@PoliceLegalPromotions.com
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