The opinion
NOT FOR PUBLICATION WITHOUT THE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-3202-18T4
JOHN ABEIGON,
Petitioner-Appellant,
v.
BOARD OF TRUSTEES,
TEACHERS' PENSION
AND ANNUITY FUND,
Respondent-Respondent.
__________________________
Argued November 16, 2020 – Decided January 5, 2021
Before Judges Messano and Suter.
On appeal from the Board of Trustees of the Teachers'
Pension and Annuity Fund, Department of the
Treasury.
Colin M. Lynch argued the cause for appellant (Zazzali,
Fagella, Nowak, Kleinbaum & Friedman, attorneys;
Colin M. Lynch, of counsel and on the briefs; Alvina
Swati, on the brief).
Alison Keating, Deputy Attorney General, argued the
cause for respondent (Gurbir S. Grewal, Attorney
General, attorney; Sookie Bae, Assistant Attorney
General, of counsel; Alison Keating, on the brief).
PER CURIAM
Appellant John Abeigon appeals the February 15, 2019 final agency
decision by the Board of Trustees of the Teachers' Pension and Annuity Fund
(TPAF Board) that denied his request to receive contributory and non-
contributory life insurance or to convert his previously lapsed contributory
group life insurance to an individual policy of insurance, and denied his request
for a hearing at the Office of Administrative Law (OAL). For reasons that
follow, we affirm.
I
Appellant was a teacher for the Newark Public Schools (Newark). As a
teacher, he had non-contributory group life insurance paid by his employer and
additional death benefits under contributory group life insurance that he paid.
See N.J.S.A. 18A:66-38 and N.J.S.A. 18A:66-53. The insurance was issued by
the Prudential Insurance Company (Prudential).
In 1994, appellant took a leave of absence from his teaching position to
serve in the Newark Teachers' Union (NTU). He remains on leave because of
his work with the NTU. He claims that when he commenced his leave of
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2
absence, he was not advised the leave "would render [him] ineligible for either
contributory or non-contributory life insurance . . . ."
Appellant acknowledged receiving a letter from the Division of Pensions
and Benefits' (Division) Enrollment and Purchase Bureau Section dated
September 3, 2010. The letter explained to pension members on leaves of
absence for union business how to obtain "pension service credit for leave[s] of
absence while serving as an elected or appointed officer or representative of a
State labor organization . . . ." Members were advised based on a recent change
in the law that they could "purchase [their] qualified union service as a personal
leave of absence," but it was the member's obligation to timely submit the
required forms.
The letter also addressed life insurance coverage for members on a leave
of absence for union activity. The letter provided "union [l]eave is a non-illness
leave of absence." Therefore, there was life insurance coverage only for a
limited period. The non-contributory life insurance was "in effect for [ninety-
three] days from the starting date of the [u]nion [l]eave." However, contributory
life insurance "normally expires [thirty-one] days after the start of the [u]nion
[l]eave." The letter advised, members could purchase an additional two months
of coverage, but that after "[ninety-three] days of coverage, members have the
A-3202-18T4
3
option [to] convert their life insurance to a private policy with Prudential." The
Division acknowledged that because of its "delay in fully addressing the . . .
conversion issue," appellant's time for the contributory life insurance conversion
was extended for an additional thirty-one days, giving him until October 4, 2010,
to ask Prudential to convert the policy to an individual policy.
The letter also refunded a payment of $111.61 to appellant that he had
made for the contributory life insurance but advised that he could convert his
policy as set forth in the letter. "[S]ince your group life insurance is now
terminated, you have [thirty-one] days from the date of this letter to initiate the
conversion process."
Appellant applied to Prudential for conversion on October 20, 2010, but
his request was denied as untimely. The record does not show whether appellant
challenged this denial.
Appellant received three letters from the Division's Office of Client
Services responding to his requests for a statement of account. The three letters
dated in 2013 and 2014 listed the amount of his contributions to the pension, the
number of years and months of pension credit and stated "you have life insurance
equal to 3 1/2 times your salary." The letter from July 2014 informed appellant
he was "insured for group life insurance" where the policyholder was the State
A-3202-18T4
4
Treasurer and a "contributory insurance" policy where the TPAF Board was the
policyholder.
Appellant acknowledged receiving a letter from the Division's
Audit/Billing Section in August 2014, that returned a $62.34 payment he made
for group life insurance. The letter stated that appellant's contributory life
insurance lapsed in 2011.
In January 2015, appellant requested the Division to modify, retroactively,
the contribution rate for purchasing pension service credit for the time he was
on leave for union activities in fiscal years 2011 through 2014. In addition, he
requested "an opportunity to convert his contributory life insurance benefit." He
explained he was "advised that he currently is ineligible for contributory life
insurance through TPAF" and that he was required to make the conversion "upon
his initial commencement of [u]nion [l]eave" but that he was not aware of this
at the time he commenced his leave. Because it was now past the time to convert,
"he presently ha[d] no insurance through TPAF." Because appellant claimed he
would have converted, he asked to have the life insurance restored or to be given
the opportunity to convert it.
The TPAF Board Secretary responded in an email dated February 6, 2015,
that appellant's request about the rate to purchase pension service credits was
A-3202-18T4
5
referred to the Budget and Compliance section for review. His request about
the contributory life insurance was addressed by attaching a copy of the
September 2010 letter.
In June 2016, appellant was successful in being able to purchase his
pension service credits at a lower rate. Two years later in April 2018, appellant
emailed the Division's Adjustment Section asking for a verification of life
insurance letter. A specialist in that section emailed, advising appellant he d id
not have life insurance while he was on a leave of absence as a union
representative. The email cited to the September 2010 letter, and explained that
"[u]nion leave is a non-illness leave of absence." Appellant was offered the
ability to convert in 2010.
On June 16, 2018, the Division's Chief of Operations for
Retirement/Beneficiary Services responded to appellant's May 24, 2018 letter to
the TPAF Board. The letter reiterated what had been explained to appellant in
the September 2010 letter. Appellant's file "indicate[d] he was notified in
September 2010 . . . that his [n]on-[c]ontributory [l]ife [i]nsurance coverage was
considered expired [ninety-three] days after his [u]nion [l]eave began and the
[c]ontributory portion expired [thirty-one] days after the date the leave began."
The Division's records indicated that appellant "did not contact the division or
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6
Prudential Insurance Company regarding converting his [c]ontributory portion
during the extended time frame allotted . . . ." The Division explained because
appellant "was afforded additional time to file for a conversion of life insurance
coverage in 2010, [it] must deny his request to convert at this time." The letter
noted the issue about purchasing union leave time service credits "[was] separate
and apart from the issue of the life insurance coverage while on the leave of
absence." If he were an active contributing member, however, he would be
covered by the contributory and non-contributory life insurance.
Appellant appealed to the TPAF Board. In his supporting certification, he
alleged he was not advised when he took the leave of absence that this "would
render [him] ineligible for either contributory or non-contributory life insurance,
or that [he] would be required to convert [his] contributory life insurance."
Appellant understood the September 2010 letter "requiring conversion of
contributory life insurance to be the result of my non-payment of TPAF
contributions which was [the] subject of my appeal and . . . believed [he]
rectified that issue upon the success of that appeal and subsequent payment of
the reduced contributions pursuant thereto." Thus, appellant argued that he
thought his success in June 2016 on the pension service credit issue somehow
either restored the life insurance or opened his ability to convert it.
A-3202-18T4
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The TPAF Board's October 19, 2018 decision upheld the administrative
decision of June 16, 2018 that had denied appellant's request to convert the
contributory life insurance. The TPAF Board decision was based on the
September 2010 letter and N.J.A.C. 17:3-3.10. Appellant had been given until
October 4, 2010, to submit an application to convert but submitted his on
October 20, 2010. He was notified on November 4, 2010, that his request was
denied. The TPAF Board explained that in 2015, appellant was advised his
request for pension service credits was different from converting the life
insurance, but if he returned to active service with the TPAF, then he would be
eligible for both contributory and non-contributory policies.
Appellant disagreed, appealing to the TPAF Board for reconsideration on
November 30, 2018, and requesting a hearing. The TPAF Board determined
there were no material facts in dispute and that an OAL hearing was not needed.
In its final agency decision, dated February 19, 2019, the TPAF Board rejected
appellant's arguments about converting his contributory life insurance. It found
appellant was advised in 2010 about the timeframes for converting the life
insurance. His leave was a "non-illness leave of absence." Appellant was given
until October 4, 2010, to convert but did not exercise this in time. Appellant
was notified in 2010 that his conversion application was denied.
A-3202-18T4
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The TPAF Board cited N.J.A.C. 17:3-3.10 in support. The TPAF Board
found "there are no equitable arguments in favor of allowing [appellant] to
appeal the TPAF Board's decision." The TPAF Board found the regulatory
language to be "clear and unambiguous." Because there were no issues of
disputed fact, the TPAF Board made findings of fact and conclusions of law
without the need for a hearing.
On appeal, appellant raises the following issues:
Point I
THIS COURT SHOULD REVERSE THE DECISION OF
THE BOARD OF TRUSTEES OF THE TEACHERS'
PENSION AND ANNUITY FUND SINCE IT IS
INCONSISTENT WITH, AND/OR IMPROPERLY
APPLIES N.J.A.C. 17:3-3.10, OR IN THE ALTERNATIVE
THE DECISION SHOULD BE REVERSED BECAUSE IT
WAS ARBITRARY, CAPRICIOUS, AND
UNREASONABLE.
A. The Interpretation Of N.J.A.C. 17:3-3.10 Is A
Question Of Law, And Therefore, It Should Be
Reviewed Under The De Novo Standard.
B. The TPAF Board's Decision Is Arbitrary,
Capricious, And Unreasonable Because It Is
Inconsistent With And Unsupported By Substantial
Evidence In The Record.
Point II
ALTERNATIVELY, THE BOARD OF TRUSTEES OF THE
TEACHERS' PENSION AND ANNUITY FUND'S
A-3202-18T4
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DECISION SHOULD BE REMANDED FOR HEARING ON
MATERIAL ISSUES OF FACT.
II
Our review of an administrative agency's final decision is limited.
Kadonsky v. Lee, 452 N.J. Super. 198, 201-02 (App. Div. 2017). "We will not
reverse an agency's judgment unless we find the decision to be 'arbitrary,
capricious, or unreasonable, or not supported by substantial credible evidence
in the record as a whole.'" Id. at 202 (alteration in original) (quoting In re
Stallworth, 208 N.J. 182, 194 (2011)). We "defer to the specialized or technical
expertise of the agency charged with administration of a regulatory system."
K.K. v. Div. of Med. Assistance & Health Servs., 453 N.J. Super. 157, 160 (App.
Div. 2018) (quoting In re Virtua-West Jersey Hosp., 194 N.J. 413, 422 (2008)).
An agency is owed "some deference to its 'interpretation of statutes and
regulations within its implementing and enforcing responsibility.'" Utley v. Bd.
of Review, 194 N.J. 534, 551 (2008) (quoting In re Appeal by Progressive Cas.
Ins. Co. 307 N.J. Super. 93, 102 (App. Div. 1997)). However, "if an agency's
statutory interpretation is contrary to the statutory language, or if the agency's
interpretation undermines the Legislature's intent, no deference is required."
Reilly v. AAA Mid-Atl. Ins. Co. of N.J., 194 N.J. 474, 485 (2008) (quoting In
re N.J. Tpk. Auth. v. AFSCME, Council 73, 150 N.J. 331, 351 (1997)).
A-3202-18T4
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Appellant argues that his leave of absence for labor union activities is not
personal leave but is a leave for service. He contends the regulation relied on
by the TPAF Board is not applicable to "service leave" and only applies to
members who "take an unpaid official leave of absence for personal illness, for
personal reasons, and/or to fulfill a residency requirement." Appellant argues
this is a question of law subject to de novo review.
The Teachers' Pension and Annuity Fund Law (TPAF), N.J.S.A. 18A:66-
1 to -93, defines "teacher" to include among others, "any person who serves,
while on an approved leave of absence from regular duties as a teacher, as an
officer of a local, county or State labor organization which represents, or is
affiliated with an organization which represents, teachers as defined in this
subsection." N.J.S.A. 18A:66-2(p). Teachers are members of the TPAF.
N.J.S.A. 18A:66-4. A person who is on an official leave from teaching and who
is "an officer of a local, county or State labor organization which represents, or
is affiliated with an organization which represents, teachers . . . shall receive
credit in the retirement system for the service." N.J.S.A. 18A:66-14.2(a).
The TPAF statute provides for life insurance—referred to as a "death
benefit"—for a "member in service," which is 1 1/2 times compensation.
N.J.S.A. 18A:66-38(b). Under this statute, "a member of the retirement system
A-3202-18T4
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shall be deemed to be an active member . . . while he is disabled due to sickness
or injury arising out of or in the course of his employment as a teacher . . . ."
N.J.S.A. 18A:66-38. A member is also "an active member" if on an "official
leave" due to maternity, "to fulfill a residency requirement for an advanced
degree," or as "a full-time student at an institution of higher education, and for
a period of not more than [ninety-three] days while on official leave of absence
without pay when such leave of absence is due to any reason other than illness."
Ibid. (emphasis added). Thus, the statute is addressed to all official leaves of
absence without pay. There is nothing in the language to indicate that leave for
service in a union is excepted from its provisions.
The TPAF provides for "optional death benefits," permitting members to
elect "additional death benefit coverage" if certain conditions are met and
contribute to its cost. N.J.S.A. 18A:66-53(b). This is referred to as contributory
life insurance. N.J.S.A. 18A:66–53(e) provides for death benefits equal to two
times the amount of the last year's compensation and requires the member to be
"in service" at the time of death. A member is "deemed to be in service" if on
official leave of absence due to illness under the limitations set forth in the
statute. Union activity is not mentioned.
A-3202-18T4
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The TPAF statute provides a conversion privilege for the contributory
group life coverage for members who have "ceased to be in service or ha[ve]
retired . . . ." N.J.S.A. 18A:66-79. Within thirty-one days, the member may
convert his or her policy to an individual policy. Ibid. This is consistent with
conversion rights under group life insurance set forth in N.J.S.A. 17B:27 -72(i).
N.J.A.C. 17:3-3.10 was promulgated to effectuate these provisions and
provides:
(a) Contributory insurance coverage will remain in
effect for up to two years while a member is on an
official leave of absence without pay for the personal
illness of the member and without premiums paid by
the member. The employer shall provide to the
Division proof of the official leave of absence.
(b) Contributory insurance coverage will remain in
effect while a member is on an official leave of absence
without pay for the following reasons, provided that
insurance premiums are paid by the member within 31
days of the official start date of the leave. It is the
member's responsibility to make arrangements directly
with the Division to continue these premium payments:
1. Up to one year to fulfill a residency requirement
for an advanced degree; or as a full-time student
at an institution of higher education; and
2. Up to [ninety-three] days on an official leave for
any other reason.
(c) Contributory insurance coverage will remain in
effect for members who are receiving periodic benefits
A-3202-18T4
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directly from workers' compensation. No premiums are
required pursuant to N.J.S.A. 18A:66-32.1.
[N.J.A.C. 17:3-3.10.]
We are required to apply the statutes as written. "If the statute is clear
and unambiguous on its face and admits of only one interpretation, we need
delve no deeper than the act's literal terms to divine the Legislature's intent."
State v. Butler, 89 N.J. 220, 226 (1982). We are not to "speculate or otherwise
engage in an interpretation which would avoid [the statute's] plain meaning."
Sterling Laurel Realty, LLC v. Laurel Gardens Co-Op, Inc., 444 N.J. Super. 470,
476 (App. Div. 2016). However, "[i]f the plain language leads to a clear and
unambiguous result, then the interpretive process should end, without resort to
extrinsic sources." State v. D.A., 191 N.J. 158, 164 (2007).
Pension statutes are to be construed liberally based upon their remedial
character. Bumbaco v. Bd. of Trs. Pub. Emps.' Ret. Sys., 325 N.J. Super. 90, 94
(App. Div.1999). However, "[a]n administrative agency may not under the guise
of interpretation extend a statute to include persons not intended, nor may it give
the statute any greater effect than its language allows." Kingsley v. Hawthorne
Fabrics, Inc., 41 N.J. 521, 528 (1964).
The statutes do not make a distinction between personal leave and service
leave. They are very clear that except in limited situations, the contributory and
A-3202-18T4
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non-contributory life insurance terminates unless there is a conversion within a
limited window of opportunity.
Appellant suggests that N.J.S.A. 18A:66-14.2 provides support for his
position that service leave is separate and not subject to N.J.S.A. 18A:66-38 or
N.J.S.A. 18A:66-53. That statute provides that any person who takes a leave of
absence from their regular duties as a teacher to serve as an officer of a teacher's
union shall receive credit in the retirement system for their service . However,
N.J.S.A. 18A:66-14.2 is concerned with service time for pension benefits. It
does not deal with a member's eligibility for life insurance while on a leave of
absence.
Appellant's contention that TPAF Employers' Pensions and Benefits
Administration Manual (Manual) supports his position is simply a restatement
of the same argument. The Manual provision cited by appellant is part of the
"Purchase of Service Credit" section. Appellant did not include the section on
"Group Life Insurance Coverage." The issues are treated separately by the
Manual.
Appellant missed the deadline for converting his policy. Having failed to
make the deadline, appellant's life insurance coverage was terminated by
A-3202-18T4
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operation of N.J.A.C. 17:3-3.10 upon his failure to convert the policy within
thirty-one days of the September 3, 2010 letter.
Appellant argues that the final agency decision is arbitrary and capricious.
He claims he relied to his detriment on the representations in 2013 and 2014 that
he had life insurance benefits. He argues he discontinued a personal policy of
insurance on this basis. He contends that factual questions require a hearing
about whether there was detrimental reliance and conflicting positions taken by
the TPAF.
When an appeal to the TPAF Board "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." N.J.A.C. 17:3-1.7(a)(4).
However, when the appeal "involves a question of facts, the Board shall submit
the matter to the [OAL]." N.J.A.C. 17:3-1.7(a)(5).
We agree with the TPAF Board that there was no need for a hearing at the
OAL. Appellant was advised in 2010 he did not have life insurance, which he
applied for and then missed the opportunity to convert. The one-page reference
to his personal policy of insurance shows a date in 2012, indicating it may have
been issued then. Appellant repeatedly requested information from the Division
A-3202-18T4
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about his account in 2013 and 2014. These letters did indicate insurance
coverage. However, by August 2014, the Division returned his payment because
his policy had lapsed. The Division's position was consistent from that point
forward that there was no insurance coverage. There is no documentary
evidence that appellant cancelled his private insurance policy or when this may
have occurred. There also is no evidence that he was unable to reapply for
coverage at any time after 2014.
Appellant claims he is entitled to a hearing because he relied to his
detriment on the letters from 2013 and 2014. "Equitable estoppel is rarely
invoked against a governmental entity . . . ." O'Malley v. Dep't of Energy, 109
N.J. 309, 317 (1987). It can be invoked, however, "to prevent manifest
injustice." Ibid. The elements of equitable estoppel include "a knowing and
intentional misrepresentation by the party sought to be estopped under
circumstances in which the misrepresentation would probably induce reliance,
and reliance by the party seeking estoppel to his or her detriment." Ibid.
Appellant has not alleged that the letters in 2013 and 2014 were intended
to misrepresent the terms of his coverage. The statutes and regulations were
clear. Appellant was repeatedly told he had no life insurance coverage. This
was the case in 2010, 2014 and after that. He acknowledged a lack of coverage.
A-3202-18T4
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Any reliance on the letters was not reasonable. He has not established a manifest
injustice. He suffered no prejudice because he has not utilized the death benefit
and has not claimed an inability to obtain insurance.
After carefully reviewing the record and the applicable legal principles,
we conclude that appellant's further arguments are without sufficient merit to
warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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