Lovely-Belyea v. Maine State Retirement Sys.

STATE OF MAINE SAF eOe SUPERIOR COURT

CUMBERLAND, ss. cant CIVIL ACTION

lee [2 te 32 ANU DOCKET NO. AP-01-10

\ Pec. « CU oe f |

CAROLE LOVELY-BELYEA,

Petitioner,

Vv. ORDER ON PETITIONER’S

80C APPEAL

MAINE STATE RETIREMENT SYSTEM,

Respondent.

The petitioner, Carole Lovely-Belyea, has appealed the final administrative

action by the Maine State Retirement System (“MSRS”), pursuant to MLR. Civ. P.

80C. The petitioner asserts that MSRS did not comply with the applicable state and

federal regulations governing the conversion of a retirement system from one that

includes an age-discriminatory disability policy to one that does not, and

consequently argues that she should be permitted to enroll in the non-

discriminatory plan. After reviewing the petitioner’s brief, MSRS’s response, and

the relevant law, the petitioner’s requested relief is denied.

STATUTORY BACKGROUND

The federal Older Workers Benefit Protection Act (“OWBPA”), 104 Stat. 978,

981-82, Public Law 101-433, contains a provision prohibiting age-dependent disability

benefits in retirement systems, but includes a provision by which employees could

continue to be covered by the “age-discriminatory” plan if the employees are given

the opportunity to elect participation in the new plan. The employer could offer

employees, hired prior to October 16, 1992, the option to elect participation in the

new, non-discriminatory plan in lieu of the existing age-discriminatory plan if : (1)

the offer was made and reasonable notice provided no later than the date that was

two years after the enactment of the OWBPA,; and (2) the employee was given up to

180 days after the offer in which to make the election. OWBPA, § 105(c)(2)(A)(ii).

The date of enactment was October 16, 1990. If the employee did not elect to be

covered by the new disability benefits, the employer could continue to cover the

employee under the age-discriminatory plan. OWBPA, § 105(c)(2)(B).

In Maine, legislation governing the election of the new, non-discriminatory

benefits plan by public employees was enacted as required by the OWBPA. 5

M.RS.A. § 17941 (1992) repealed by P.L. 1995, ch. 643, § 16 (eff. April 10, 1996). Under

§ 17941, MSRS was responsible for providing information to state agencies and

school administrative units that described the amended disability plan, the disability

plan without the amendment, and “a form for individual member election to be

covered under the plan as amended.” 5 M.RS.A. § 17941(1)(A). The statute

provided that the state agency or school administrative unit was responsible for

distributing information and election forms to the eligible members, and collecting

the completed election forms and returning the forms to MSRS. 5 M.RS.A. §

17941(1)(A). The statute specified that the information and election form were to be

given to the eligible members not later than October 16, 1992, and that the election to

participate in the new plans was to be effective 180 days later (April 14, 1993) only if

the election was signed and dated on or before a date “established by the executive

director that may not be later than 180 days after October 16, 1992 [April 14, 1993].”! §

17941(1)(C),(D)(E). Unless a member elected to be covered by the new plan, she

would be covered by the existing plan. § 17941(2). The election was irrevocable. §

17941(1)(E).

FACTUAL BACKGROUND

The petitioner was employed as a teacher by the Lewiston School Department

when, on March 31, 1993, she signed an MSRS 1993 Disability Election Form,

electing not to move to the non-discriminatory benefits plan. The petitioner

remained covered under the age-discriminatory plan. When the petitioner applied

for disability benefits in 1998, her claim was denied by the Executive Director of

MSRS, because she was beyond the “normal retirement age.” She appealed the

denial to the Maine State Retirement Board (Board), on the ground that her election

was not valid because she was not given the proper notice of election under the

governing statute, and the Board affirmed the Executive Director.

The Board found that the election form was not distributed by MSRS until

February of 1993, and was not distributed to the school employees until March 3,

1993, in contravention of § 17941(1)(C), which provides that the “school

administrative unit shall give the information and election form to each member

entitled to the election not later than October 16, 1992.” R. 34.6- R. 34.7 (emphasis

added). The Board found that the preponderance of the evidence demonstrated that

1 Based on legislative history of the federal statute, OWBPA, the Board

accepted the assertion that the employees were to be given, 180 days, as a minimum,

in which to make their election.

the initial employee information sheet, which was sent by MSRS to the Lewiston

School Department (and all employers of members of the retirement system) in

October 1992, had been distributed to all employees. R. 34.7. The Board found that

although the petitioner testified that she regularly did not receive materials that had

been left in her school mailbox, the record did not demonstrate that this was due to

the school’s lack of delivery, but rather could have been attributable to the fact that a

third person, with the petitioner’s permission, would remove the contents of the

box and place them on the petitioner’s desk. R. 34.7. The Board found that, even if

the petitioner had not received the information sheet by October 16, 1992, she had

received both the information sheet and election form by March 3, 1993.2 R. 34.7.

The Board concluded that the petitioner’s election was valid because she had

received an information sheet and election form by March 3, 1993, and the

petitioner has not provided any facts that demonstrate she was actually prejudiced

by the delay in receiving this information. R. 34.

7

The petitioner argues that there was no specific finding that she received the

information sheet by October 16, 1992, and that the finding that the petitioner

received the information sheet in October 1992 was not supported by substantial

evidence. The petitioner asserts that because she did not receive the information by

October 16, 1992, her election was invalid. The petitioner asserts that because there

was no compliance with the statute which required the timely distribution of

2 The Board’s opinion erroneously states that the petitioner had received an

election form and information sheet by March 3, 1992., however this is clearly a

typographical error.

information and election forms, the employer was not permitted to continue the

age-discriminatory benefits plan. The petitioner argues that MSRS was wrong to

hold that the petitioner was required to establish prejudice resulting from the lack of

compliance with the statutory notice requirements.

DISCUSSION

I. Substantial Evidence

When reviewing administrative agency decisions, the Superior Court must

uphold the agency’s findings of fact if supported by substantial evidence on the

record as a whole. MacDougall v. Department of Human Services, 2001 ME 64, { 6,

769 A.2d 829, 831. The finding of fact must be supported by substantial evidence and

the reasonable inferences to be drawn therefrom. Wadleigh v. Higgins, 358 A.2d

531, 531-32 (Me. 1976). Even if there is evidence that would support a contrary

result, the findings should be upheld if not clearly erroneous. Harold D. Smith &

The petitioner first asserts that the Board did not make a finding that the

information sheet had been distributed by October 16, 1992. The Board first writes,

in the context of whether the provisions requiring that the information sheet and

election form be provided by October 16, 1992, that “the preponderance of the

evidence demonstrates that [the information sheet] was distributed to all

employees.” R. 34.7.2 Later, the Board writes that “[t]he critical issue under §17941 is

3 The Board wrote: |

Looking to § 17941, the requirement which was not satisfied was

subsection (1)(C) which provides that the ‘school administrative unit

5

whether the failure to provide an election form or, for the sake of argument, an

information sheet as well, by October 16th, renders the appellant's election not to

move to the no age plan invalid.” R. 34.7. Based on these declarations, the court

concludes that the Board did find that the information sheet was distributed to all

employees by October 16, 1992. U.S. v. Nee, 261 F.3d 79 (1st Cir. 2001) (inferring a

finding by the district court, where that finding was not explicit, based on the lower

court’s written opinion)

The petitioner next argues that the finding that the information sheet was

distributed to all employees was not supported by substantial evidence. The

information sheet was not typed until October 15, 1992. Ms. White, secretary of

personnel at the Lewiston School Department, testified that she had no knowledge

of whether or how the notice was provided to the teachers, and that the principals

were responsible for delivering the sheets to the teachers. The petitioner testified

that she did not receive the notice through that system and frequently did not

receive notices provided through that system. The Board based its finding that the

information sheet had been distributed on the fact that the record established that,

in the normal course of business, school distributions were placed in the petitioner's

shall give the information and election form to each member entitled

to the election not later than October 16, 1992.’ There is no dispute that

the election form was not distributed by the system until February, 1993,

and not provided to the school employee until March 3, 1993, when it

was attached to the employee’s pay check, along with a new

information sheet. With respect to the initial employee information

sheet, the Board finds that the preponderance of the evidence

demonstrates that it was distributed to all employees ... .

R. 34.6-7.

mailbox. The Board concluded that the petitioner’s testimony that she often did not

receive materials that had been placed in her mailbox did not establish a lack of

delivery, but could have been attributable to the fact that a third party would

remove the contents of her mailbox and place them on the petitioner’s desk. R. 34.7.

The court cannot conclude that the findings of the Board were clearly

erroneous. Ms. White testified that she typed up the information sheet, recalled

that each of the principals picked up the information sheet in the morning of

October 15, 1992, that she instructed the principals that the information sheet must

go out the same day, and that the principals regularly distributed materials to the

teachers in this way, including pay checks. R. 26.4-26.5. The petitioner testified that

she normally received materials from her principal through her mailbox, and that

someone else often retrieved her mail and placed it on her desk. R. 26.47- 26.48.

Accordingly, there is substantial evidence supporting the Board’s finding that the

Il. Non-compliance with Statutory Notice Provisions

The governing statute, § 17941, does not set out a remedy if the notice

deadlines are not complied with. In various contexts of required notice, the Law

Court has concluded that even where a statutory notice requirement is couched in

terms of the mandatory “shall,” certain details of the notice could be regarded as

directory. Givertz v. Maine Medical Center, 459 A.2d 548, 554 (Me. 1983) (in the

context of a notice of claim); Seider v. Board of Examiners of Psychologists, 1998 ME

78,710 A.2d 890 (in the context of notifying Seider of her appellate rights); Interstate

Food Processing Corp. v. Town of Fort Fairfield, 1997 ME 193, 698 A.2d 1074 (using

the same rationale to allow taxpayer to appeal even where he had not paid taxes as

of the date they were due); Town of Ogunquit v. Department of Public Safety, 2001

ME 47, 767 A.2d 291 (in context of failure to serve the petitioner by certified mail

within statutory time limits); see also Amann v. Stow School System, 982 F.2d 644

(1st Cir. 1992) (concluding that hearing officer’s failure to reach a final decision

within 45 days, as statutorily required, was not grounds for vacation where no harm

was shown); Quellette v. Maine Bonding & Casualty Co., 495 A.2d 1232 (Me. 1985)

(where the court excused non-compliance with contractual notice provisions of

insurance policy). “{S]tatutorily-required notice must be given mandatory, not

directory, effect when such language is of the very essence of giving notice or if the

rights of the interested parties would be prejudiced.” Seider, 1998 ME 78, {5; 710

A.2d at 892 (internal quotations omitted).

The two notice provisions at issue are (1) the requirement that the

information sheet and election form be distributed by October 16, 1992, and (2) the

requirement that the employees be given 180 days between notice and the required

election (which, in this case, would have been April 14, 1993). § 17941(1). The

purpose of the notice provisions in § 17941 are to allow a public employee to have

time to consider her decision of whether to elect to be covered by the existing age-

discriminatory benefits plan or the new non-discriminatory plan.

As set out above, the Board’s finding that the informational sheet was

distributed to the employees in October 16, 1992, was supported by substantial

evidence. Thus, the determinative issues are (1) whether the distribution of an

election form with the information sheet was “of the very essence of giving notice”

and whether the failure to distribute an election form with the information sheet

prejudiced the rights of the petitioner; and (2) whether requiring the employees to

make their selection by April 1, 1993, rather that April 14, 1993, was “of the very

essence of giving notice” and whether the failure to allow the petitioner until April

14, 1993, to make her election prejudiced the rights of the petitioner. The election

form did not provide any additional information about the two benefit plans and

therefore was not of the very essence of giving notice. In addition, the failure to

allow employees until April 14, 1993, to make their election (and therefore giving

less than the required 180 days to make a selection of plans) was not of the very

essence of giving notice because the purpose of giving notice was served by allowing

' the employees 166 days to make their selections. The Board found that the

etitioner put forth no facts that demonstrate that she was actually prejudiced by the

delay in receiving the election form, or by the requirement that she return the

election form on April 1, 1993 (the school’s election deadline) rather than April 14,

1993 (the statutory election deadline). R. 34.7.

CONCLUSION

The Board found that the petitioner received the information sheet by

October 16, 1992, and that finding was not clearly erroneous. Accordingly, because

the failure to provide an election form and the failure to allow until April 14, 1993,

to make an election did not go to the “essence of notice” and because the petitioner

did not provide facts demonstrating that she was prejudiced by any non-compliance

with the statutory notice provisions, the court concludes that the Board’s decision

should be affirmed.

The entry is

The decision of the Maine State Retirement Board is AFFIRMED.

[fs

Dated at Portland, Maine this ped day of December 2001.

Ef boul

Robert E. Crowley

Justice, Superior Court

10

Cumberland Docket No. _ AP-01-10

County

| Date Filed 02-07-01

Action 80cAppeal

Carol Lovely-Belyea Maine State Retirement System

vs.

Plaintiff’s Attorney Defendant’s Attorney

James M. Bowie, AAG 626-8513

6 State House Station

Augusta, ME 04333-0006

Donald F. Fontaine, Esq.

P.O. Box 7590

Portland, Maine 04112

Date of

Entry