STATE OF NEW JERSEY VS. DAVID ORTMANN (L-1208-18, MERCER COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the

internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1530-18T2

STATE OF NEW JERSEY,

Plaintiff-Respondent,

v.

DAVID ORTMANN,

Defendant-Appellant.

_______________________

Argued March 16, 2020 – Decided April 8, 2020

Before Judges Sumners and Natali.

On appeal from the Superior Court of New Jersey,

Law Division, Mercer County, Docket No. L-1208-18.

Charles Joseph Sciarra argued the cause for appellant

(Sciarra & Catrambone, LLC, attorneys; Frank

Carmen Cioffi, of counsel and on the briefs).

Lauren Bonfiglio, Deputy Attorney General, argued

the cause for respondent (Gurbir S. Grewal, Attorney

General, attorney; Lauren Bonfiglio, of counsel and on

the brief).

PER CURIAM

Defendant David Ortmann appeals from that portion of a Law Division

order compelling the forfeiture of his entire pension earned while employed as

a Jersey City police officer for over twenty-seven years. The court based its

forfeiture decision on the fact that Ortmann pled guilty to a federal information

in the United States District Court for the District of New Jersey to conspiracy

to defraud the United States of America, in violation of 18 U.S.C. § 371, for

accepting over $12,000 in payments from Jersey City for work he admitted he

did not perform. Ortmann raises the following related constitutional points on

appeal:

POINT I

THE COURT ERRED IN DECIDING THIS

MATTER AS THE BOARD OF TRUSTEES FOR

THE POLICEMEN AND FIR[E]MEN RETIREMENT

SYSTEM HAS EXCLUSIVE AUTHORITY OVER

OPERATION OF THE PENSION FUND.

POINT II

ASSUMING ARGUENDO THAT THE COURT HAD

PROPER JURISDICTION OVER THIS MATTER,

THE COURT ERRED IN DENYING APPELLANT

AN[] EVIDENTIARY HEARING AS N.J.S.A. 43:1-

3.1 IS UNCONSTITUTIONAL AS APPELLANT

HAS BEEN DENIED HIS STATE

CONSTITUTIONAL DUE PROCESS RIGHTS.

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A. N.J.S.A. 43:1-3.1 DEPRIVES

APPELLANT OF HIS PROCEDURAL

DUE PROCESS RIGHTS.

B. APPELLANT'S SUBSTANTIVE DUE

PROCESS RIGHTS HAVE ALSO BEEN

VIOLATED AS APPELLANT IS BEING

DEPRIVED OF A PROPERTY

INTEREST IN THE FORM OF HIS

VESTED RETIR[E]MENT PENSION

BENEFITS WITH THE STATE'S

PENSION FUND.

POINT III

ASSUMING ARGUENDO THAT THE COURT

DOES NOT FIND THAT N.J.S.A. 43:1-3.1 […]

VIOLATE[D] OFFICER ORTMANN'S DUE

PROCESS RIGHT[S], IF THE COURT APPLIED

THE BALANCING TEST AND FACTORS APPLIED

IN URICOLI,[1] THE COURT WOULD NOT HAVE

ORDERED A COMPLETE FORFEITURE OF

APPELLANT'S PENSION.

We disagree with all of Ortmann's arguments and affirm substantially for

the reasons detailed in Judge Mary C. Jacobson's thoughtful and

comprehensive September 25, 2018 oral decision. We provide the following

comments to amplify that decision and to provide context for our opinion.

1

Uricoli v. Bd. of Trs., 91 N.J. 62 (1982)

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I.

Ortmann joined the Jersey City Police Department ("JCPD") as a

patrolman following his graduation from the Jersey City Police Academy in

1989. Ortmann served with the JCPD for over twenty-seven years in various

capacities. In 2007, Ortmann began working as the district clerk for the West

District of Jersey City, a position he retained until his retirement in 2016. In

addition to his district clerk duties, Ortmann also briefly served as off -duty

coordinator, scheduling and dispatching the district's police officers for

various off-duty jobs.

On December 20, 2016, Ortmann filed a retirement application with the

Division of Pensions and Benefits seeking an effective retirement date of

January 1, 2017. The application was subsequently approved by the Trustees

of the Police and Firemen's Retirement System ("Board") and Ortmann began

receiving his pension benefits on February 1, 2017.

As noted, on May 12, 2017, Ortmann pled guilty to a violation of 18

U.S.C. § 371. In the federal information detailing the allegations against him,

the United States Attorney for the District of New Jersey asserted that between

July 2015 and May 2016, Ortmann was involved in a conspiracy to receive

payments from Jersey City for off-duty work that he did not perform by

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making false representations about his off-duty assignments. Through this

conspiracy, Ortmann accepted over $12,000 in unearned payments. Ortmann

was sentenced consistent with his plea bargain to a three-year probationary

term, fined $2000, and ordered to pay restitution in the amount of $17,620.

Ortmann also entered a consent judgment and order of forfeiture of the

$12,617 in improper payments he received.

The State then filed a verified complaint and order to show cause

seeking, among other relief, Ortmann's permanent disqualification from any

public position. The complaint also alleged that Ortmann's federal conviction

constituted a crime substantially similar to the crimes enumerated under

N.J.S.A. 43:1-3.1(b) which required the complete forfeiture of all benefits

earned as a member of the public pension fund in which he participated at the

time of the commission of the offense. 2

Judge Jacobson granted the State's application to proceed summarily and

after hearing oral arguments, issued an oral decision and order granting the

State's summary judgment application. In her oral opinion, the judge rejected

2

The State also filed a verified complaint against Ortmann's co-conspirator,

also seeking forfeiture of public office, permanent disqualification from any

other public position, and forfeiture of pension benefits. The court granted the

State's application in that related matter and entered a conforming order on

June 27, 2019.

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all of Ortmann's jurisdictional and constitutional arguments and specifically

concluded that the Legislature's enactment of N.J.S.A. 43:1-3.1 did not violate

the separation of powers doctrine and the complete forfeiture of Ortmann's

pension did not violate his substantive or procedural due process rights. 3

Specifically, the court reasoned that there was no "separation of powers

problem with the [L]egislature directing the court to . . . grant an order of total

forfeiture if the statutory requirements are met." The court noted that, in

amending the statute in 2007 to include mandatory forfeiture, the Legislature

"recognized that the pension board had administrative responsibilities for

administering the pension, but . . . directed that the . . . application for the total

forfeiture be done by . . . a state court judge." The court determined that

because "the [L]egislature had the authority to delegate in the first instance," it

was "not up to the court to quarrel with the legislative decision to make the

delegation."

Further, the court concluded that because "the [L]egislature intended a

total forfeiture when an individual commits [a] crime that is listed in [N.J.S.A.

3

Ortmann also alleged that the pension forfeiture violated his equal protection

rights. He has not, however, raised that claim on appeal, and it is therefore

waived. See Sklodowsky v. Lushis, 417 N.J. Super. 648, 657 (App. Div.

2011).

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43:1-3.1]" and Ortmann's crime "touched upon his employment as a Jersey

City police officer," Ortmann's due process rights were satisfied without an

evidentiary hearing. In this regard, the court noted that "there [was] no basis

for any trial[-]type hearing because there [were] no facts in dispute" regarding

whether Ortmann's crime violated N.J.S.A. 43:1-3.1.

With respect to Ortmann's equal protection claim, the court determined

that although "some arguably similar cases . . . fall between the cracks," no

suspect class existed. The court noted that "[t]he statute itself vests the

[A]ttorney [G]eneral with the authority to seek total pension forfeiture . . .

when [that forfeiture] is based on a conviction of the laws of the United

States," like Ortmann's in this case. It further stated that "[t]he [L]egislature

had the right to determine the criteria on which pension forfeiture would be

based," and in enacting N.J.S.A. 43:1-3.1, it used its discretion to proscribe the

type of conduct in which Ortmann engaged and to require a total pension

forfeiture.

After the court denied Ortmann's stay application, this appeal followed.

II.

We reject Ortmann's claim that the trial court did not have jurisdiction to

decide the forfeiture issues raised by the State's verified complaint as contrary

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to the express provisions of N.J.S.A. 43:1-3.1. That statute provides that any

person who holds or formerly held "any public office, position, or

employment" in the State government, or an agency or division thereof, and is

convicted of one of the enumerated crimes "shall forfeit all of the pension or

retirement benefit" in which he participated at the time the offense was

committed and which covered the position involved in that offense. N.J.S.A.

43:1-3.1(a); see also State v. Steele, 410 N.J. Super. 129, 134-35 (App. Div.

2011). Among the enumerated offenses are various crimes involving official

misconduct. N.J.S.A. 43:1-3.1(b). Further, a court must order a total pension

forfeiture if an individual, like Ortmann, is convicted of a "substantially

similar offense[s] under the laws of another state or the United States."

N.J.S.A. 43:1-3.1(a). In this regard, N.J.S.A. 43:1-3.1(c) provides that "[a]

court of this State shall enter an order of pension forfeiture pursuant to this

section" upon a finding of guilt by the trier of fact, entrance of a guilty plea, or

application by the State when forfeiture is based on a conviction under the

laws of another jurisdiction.

Ortmann argues that, pursuant to N.J.S.A. 43:16A-13(a)(1), the Board

has exclusive authority over the operation of the pension fund, including

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primary and exclusive jurisdiction over issues relating to entitlement to

benefits. N.J.S.A. 43:16A-13(a)(1) provides:

[T]he general responsibility for the proper operation

of the retirement system is hereby vested in a board of

trustees . . . . The board shall act exclusively on

behalf of the contributing employers, active members

of the retirement system, and retired members as

fiduciary of the system. The primary obligation of the

board shall be to direct policies and investments to

achieve and maintain the full funding and continuation

of the retirement system for the exclusive benefit of its

members.

The meaning of any statute is a question of law which we review de

novo. Steele, 420 N.J. Super. at 133. Legislative intent is the primary concern

in interpreting a statute, and "the best indicator of that intent is the statutory

language." Ibid. (quoting DiProspero v. Penn, 183 N.J. 477, 492 (2005)).

Courts do not "engage in conjecture or surmise which will circumvent the

plain meaning" of a statute. Ibid.

Here, although the Legislature delegated general administrative authority

over the pension fund to the Board under N.J.S.A. 43:16A-13(a)(1), the

Legislature later explicitly delegated pension forfeiture determinations

pursuant to N.J.S.A. 43:1-3.1 to the judiciary. While Ortmann places much

emphasis on the use of the word "exclusively" in N.J.S.A. 43:16A-13(a)(1),

this term is plainly used to establish that the Board, as fiduciary, is to act

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solely in service of its contributing employers and members, to the exclusion

of any other competing interests. Nothing in the plain language of the statute

could be interpreted to preclude the Legislature from imposing new limitations

or delegating other powers going forward, such as the delegation made to the

judiciary in N.J.S.A. 43:1-3.1. Judge Jacobson therefore clearly had

jurisdiction to resolve the pension forfeiture application.

Nor does the Legislative delegation in N.J.S.A. 43:1-3.1 violate the

Separation of Powers clause of the New Jersey Constitution. See N.J. Const.

art. III ("The powers of the government shall be divided among three distinct

branches, the legislative, executive, and judicial. No person or persons

belonging to or constituting one branch shall exercise any of the powers

properly belonging to either of the others, except as expressly provided in this

Constitution."). Like all statutes, N.J.S.A. 43:1-3.1 is presumed constitutional.

Whirlpool Props. v. Dir., Div. of Taxation, 208 N.J. 141, 175 (2011). A

legislative act will only be declared void if "its repugnancy to the Constitution

is clear beyond a reasonable doubt." Harvey v. Bd. of Chosen Freeholders, 30

N.J. 381, 388 (1959). The "heavy burden" of establishing invalidity rest s with

the party challenging the statute. State v. Trump Hotels & Casino Resorts, 160

N.J. 202, 526 (1999).

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In this case, Ortmann has failed to meet the heavy burden of

demonstrating that N.J.S.A. 43:1-3.1 is an unconstitutional violation of the

Separation of Powers clause. Indeed, while the clause prevents the

concentration of "inordinate power" in any single branch, it does not bar

"cooperative action" among the three branches, nor the delegation of limited

power from one branch to another. Brown v. Heymann, 62 N.J. 1, 11 (1972).

In fact, "the doctrine necessarily assumes the branches will coordinate to the

end that government will fulfill its mission." Ibid. It is well-established that

the Legislature may delegate authority to another branch, so long as sufficient

standards are provided to guide the exercise of discretion. Mt. Laurel v. Dep't

of Pub. Advoc., 83 N.J. 522, 532 (1980). When the Legislature has chosen to

delegate some of its authority to a co-equal branch, "it does not rest with [the

judiciary] to quarrel with the legislative decision to make the delegation."

Brown, 62 N.J. at 10.

Public-pension systems, like the Police and Firemen's Retirement

System at issue here, are expressly a creation of the Legislature. See N.J.S.A.

43:16A-2. And the Legislature delegated certain powers to the Board for the

purposes of administering that system. N.J.S.A. 43:16A-13(a). Among those

powers delegated is the discretionary authority to order the forfeiture of

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benefits when a member engages in misconduct during his or her public

service. N.J.S.A. 43:1-3(b). To guide the Board in the exercise of this

discretionary authority, the Legislature codified the Uricoli balancing test in

N.J.S.A. 43:1-3(c), providing relevant factors for the Board to consider when

deciding to impose a partial or complete forfeiture.

By making this delegation, however, the Legislature did not cede all its

power to the Board, only those powers specified by statute. By enacting

N.J.S.A. 43:1-3.1, the Legislature delegated a different power – the authority

to enter mandatory pension forfeitures when the statutory criteria are met – and

it explicitly delegated that power to the judiciary. See N.J.S.A. 43:1-3.1(c). In

this regard, to distinguish between the Board's discretionary authority and the

authority granted to the courts, the Legislature explicitly provided that

"[n]othing in this section shall be deemed to preclude the authority of the

board of trustees . . . from ordering the forfeiture of all or part" of a member's

pension benefits pursuant to its discretionary authority. N.J.S.A. 43:1 -3.1(e).

We also agree with Judge Jacobson that the pension forfeiture ordered

did not violate Ortmann’s procedural or substantive due process rights. Under

Article I, § 1 of the New Jersey Constitution, "[a]ll persons are by nature free

and independent, and have certain natural and unalienable rights, among which

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are those of enjoying and defending life and liberty, of acquiring, possessing,

and protecting property, and of pursuing and obtaining safety and happiness."

Although the phrase "due process" does not appear in this section, our

Supreme Court has interpreted this provision to encompass both procedural

and substantive due process protections. Greenberg v. Kimmelman, 99 N.J.

552, 568 (1985).

In evaluating a procedural due process claim, New Jersey courts must

determine whether the State has infringed on a protected liberty or property

interest and "whether the procedures attendant upon that deprivation are

constitutionally sufficient." Doe v. Poritz, 142 N.J. 1, 99 (1995). It is well-

established that public employees, like Ortmann, have a protected property

interest in their pension benefits. Gauer v. Essex Cty. Dep't of Welfare, 108

N.J. 140, 150 (1987) (citing Spina v. Consol. Police & Firemen's Pension Fund

Comm'n, 41 N.J. 391, 402 (1964)). Procedural due process, however, is "not a

fixed concept . . . but a flexible one that depends on the particular

circumstances." Id. at 106. At a minimum, due process requires notice and the

opportunity to be heard. Ibid.

Here, Ortmann received notice and had the opportunity to be heard

before the trial court. We disagree with Ortmann's claim that he was entitled

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to a proceeding in the Office of Administrative Law before an Administ rative

Law Judge. As noted, N.J.S.A 43:1-3.1(c) delegates to the judiciary, not the

executive branch, the authority to address the complete pension forfeiture at

issue. Equally as important, there were no factual questions requiring a

hearing. Indeed, all relevant factual questions necessary to address the relief

requested in the State's verified complaint were resolved by Ortmann's guilty

plea.

The only issue remaining was a legal one: whether the crime of which

Ortmann was convicted falls within the ambit of N.J.S.A. 43:1-3.1. Because

the statute requires total forfeiture upon conviction of such a crime, the trial

court was obligated to enter a forfeiture order upon its legal determination that

Ortmann was convicted of a substantially similar crime to those enumerated

under N.J.S.A. 43:1-3.1(b). In fact, as Judge Jacobson noted, the kind of

evidentiary hearing requested by Ortmann would only function as an implied

repeal of the mandatory forfeiture statute. If the trial judge hearing a pension

forfeiture matter could reevaluate the undisputed facts of the underlying

criminal conviction before deciding to enter a forfeiture order, there would no

longer be anything "mandatory" about such a forfeiture.

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As previously noted, it is well-established that public employees have a

property interest in an existing pension benefits fund. Gauer, 108 N.J. at 150.

Based on this principle, Ortmann argues that the mandatory forfeiture order

deprived him of his property interest in his pension benefits and violated his

right to substantive due process. We disagree.

"Insofar as most rights are concerned, a state statute does not violate

substantive due process if the statute reasonably relates to a legitimate

legislative purpose and is not arbitrary or discriminatory." Greenberg, 99 N.J.

at 563. Unless a "fundamental right" is implicated, a statute will survive a due

process challenge so long as it is supported by a rational basis. Ibid. Although

public employees have a property interest in their pension benefits , there is no

fundamental right to a public pension, and Ortmann does not argue such a

fundamental right. See Washington v. Glucksberg, 521 U.S. 702, 720-21

(1997) (stating that fundamental rights are those "objectively, deeply rooted in

this Nation's history and traditions" and "implicit in the concept of ordered

liberty" (internal quotation marks omitted)).

N.J.S.A. 43:1-3.1 is neither arbitrary nor discriminatory and is rationally

related to the legitimate legislative purpose of discouraging corruption in the

state's public workforce. The statute is by no means unprecedented in its

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imposition of pension forfeiture as a penalty for misconduct. "All public

pension statutes in this State carry an implicit condition precedent of honorable

service . . . . In that respect, pension forfeiture operates as a penalty or

punishment for wrongful conduct." Corvelli v. Bd. of Trs., Police & Firemen's

Ret. Sys., 130 N.J. 539, 550 (1992). Pension forfeiture serves two government

objectives: "punishment of the individual and deterrence, both as to the

offending individual and other employees." Eyers v. State, Bd. of Trs. Pub.

Emps. Ret. Sys., 91 N.J. 51, 56 (1982). In serving these dual purposes of

punishment and deterrence, the pension forfeiture statute operates to protect

the public from the serious problem of government corruption.

As Justice O'Hern noted in his dissent in Uricoli, while "the personal

suffering that results from pension forfeiture" may seem like a harsh penalty,

the Legislature deemed this to be an appropriate consequence for official

misconduct. Uricoli, 91 N.J. at 84. It was well within the Legislature's power

to set this penalty as it saw fit. See Brown, 62 N.J. at 10-11 (noting that policy

decisions rest with the Legislature and that a statute's constitutionality "does

not turn upon whether a plan is wise or unwise in a judge's view"). We agree

with Judge Jacobson that because N.J.S.A. 43:1-3.1 reasonably relates to the

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legitimate state interest in combating public corruption, the statute does not

violate substantive due process and is therefore constitutional.

Finally, Ortmann argues that the trial court erred in declining to apply

the Uricoli factors to his case. Again, we disagree.

Prior to the enactment of N.J.S.A. 43:1-3.1, the New Jersey Supreme

Court established a balancing test and relevant factors for courts to apply when

presented with a pension forfeiture claim. Uricoli, 91 N.J. at 77-78. The

Uricoli factors, which were later codified in N.J.S.A. 43:1-3(c), apply "only to

those claims for benefits where the specific pension statute is silent respecting

the effect of a conviction for a crime relating to the applicant's public office."

Borrello v. Bd. of Trs., Pub. Emps. Ret. Sys., 313 N.J. Super. 75, 77 (App.

Div. 1998) (emphasis added). Because Ortmann pled guilty to a crime covered

under N.J.S.A. 43:1-3.1, application of the Uricoli factors was not required.

Affirmed.

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