Crandle v. Conn. State Emps. Ret. Comm'n

• Citation: 342 Conn. 67,269 A.3d 72
• Decision Date: 01 February 2022
• Docket Number: SC 20532
• Parties: Catherine CRANDLE et al. v. CONNECTICUT STATE EMPLOYEES RETIREMENT COMMISSION
• Court: Connecticut Supreme Court

342 Conn. 67

269 A.3d 72

Catherine CRANDLE et al.

v.CONNECTICUT STATE EMPLOYEES RETIREMENT COMMISSION

SC 20532

Supreme Court of Connecticut.

Argued January 12, 2021

Officially released February 1, 2022^*

Russell D. Zimberlin, for the appellants (named plaintiff et al.).

Cindy M. Cieslak, with whom, on the brief, was Michael J. Rose, for the appellee (defendant).

Robinson, C. J., and McDonald, D'Auria, Mullins, Kahn, Ecker and Keller, Js.

ROBINSON, C. J.

The principal issue in this appeal is whether the State Employees Retirement Act (act), General Statutes § 5-152 et seq., requires the state to commence payment of state employee disability retirement benefits on the day after the employee's last day of paid employment or, instead, the act permits the payment of such benefits to start on the first day of the month after receipt of the employee disability retirement application. The plaintiffs, Catherine Crandle and Ronald Robinson,¹ who are former state employees, appeal² from the judgment of the trial court dismissing their administrative appeal from the declaratory ruling of the defendant, the Connecticut State Employees Retirement Commission (commission). On appeal, the plaintiffs claim that the trial court improperly upheld the commission's declaratory ruling that, under various provisions of the act, disability retirement benefit payments commence on the first day of the month following receipt by the Retirement Services Division (division) of the employee's approved application for such benefits. The plaintiffs contend that the trial court improperly (1) deferred to the commission's interpretation of the act because that interpretation is neither reasonable nor time-tested, and (2) failed to consider that the commission, as a fiduciary of members of the State Employees Retirement System (SERS), had the burden of proving fair dealing by clear and convincing evidence. We disagree with these claims. Accordingly, we affirm the judgment of the trial court.

The record reveals the following facts, which the commission found or which are undisputed, and procedural history. Crandle is a member of Tier II of SERS.³ On April 13, 2016, the division received Crandle's application for disability retirement benefits. Because Crandle's last date of state employment was October 16, 2012, the application was untimely under § 5-155a-2 (d) of the Regulations of Connecticut State Agencies, which requires such applications to be filed within twenty-four months of the applicant's last day of paid employment. Crandle requested that the commission toll the limitation period for submitting the application, and the commission granted her request. Thereafter, the State of Connecticut Medical Examining Board for Disability Retirement (board) conducted a hearing on Crandle's application for disability retirement benefits and granted it. Payment of the benefits commenced on May 1, 2016, the first day of the month following the division's receipt of the application.

Robinson is a member of Tier IIA of SERS.⁴ His last date of state employment was October 31, 2015. On March 30, 2016, Robinson applied for disability retirement benefits. The board approved his application, and payment of the benefits commenced on April 1, 2016, the first day of the month following the division's receipt of his application.

On March 1, 2018, the plaintiffs filed a petition for a declaratory ruling with the commission, contending that, under the act, payment of disability retirement benefits commences the day after the employee's last day of paid employment.⁵ In its decision and declaratory ruling, the commission noted that the act is silent with respect to when disability retirement benefits become payable. The commission disagreed with the plaintiffs’ reliance on § 5-155a-2 (d) of the regulations of Connecticut State Agencies to support their position. The commission concluded that the language of the regulation, providing that "[t]he time period for filing an application for disability retirement benefits ... shall begin on the day after the applicant's last day of paid employment," simply provides a time frame in which the applicant must apply and does not prescribe the day that payment begins. The commission also observed that normal retirement benefits for Tier II members become payable on the first day of any future month named in the application.⁶ See, e.g., General Statutes § 5-192l (a) ("[e]ach member of tier II who has attained age sixty-five and has completed ten or more years of vesting service may retire on his own application on the first day of any future month named in the application").

In addition, the commission pointed out that, in 1981, it had sought an opinion from the attorney general on the issue of whether disability retirement benefits are payable retroactive to the date of the employee's termination of employment under Tier I of SERS.⁷ In that opinion, the attorney general concluded that the legislature intended that Tier I "retirement benefits are to flow prospectively from the time of making application." Opinions, Conn. Atty. Gen. No. 1981-50 (July 30, 1981) p. 1 (1981 attorney general opinion). This is because "[a]xiomatic to the granting of such benefits is the requirement that a member of [SERS] apply for retirement, be it regular, disability or service-connected disability." Id., pp. 1–2. Emphasizing that it "is the filing of the application for retirement, and its subsequent approval by the [c]ommission [that] triggers a member's entitlement to benefits"; id., p. 2; the 1981 attorney general opinion concluded that "service-connected disability retirement benefits are not to be given retroactive effect when the application [therefor] is submitted subsequent to the date of termination." Id., p. 3.

The commission further reasoned in its declaratory ruling that "the [plaintiffs’] request to use the day after their last day of paid employment as the date on which benefits become payable is less of a bright-line rule [than the practice of commencing payment of benefits on the first day of the month after the application is received] since, often, in cases of disability retirement, members ... take some form of a leave of absence while they evaluate whether they will recover from their injury or in fact are permanently disabled from the job so as to qualify for a disability retirement. Sometimes such leave is paid, and sometimes it is unpaid, depending on the types of leave accrued pursuant to sick time, vacation, family and medical leave, and workers’ compensation laws and policies." Moreover, the commission noted that "some of the petitioners"; see footnote 5 of this opinion; "claimed service credit for certain types of leave, and the statutes do not permit an employee to receive service credit and a retirement benefit for the same period of employment."

Finally, the commission observed that it had implemented the foregoing interpretation of the act in a number of cases since 1981 and that the legislature had not overruled that interpretation, despite making multiple changes to SERS.⁸ The commission further pointed out that the act is a creature of collective bargaining and was approved and codified by the legislature pursuant to General Statutes (Rev. to 2017) § 5-278 (b),⁹ and that the parties charged with negotiating the terms of SERS had not made any attempt to amend the act in light of the commission's interpretation. Accordingly, the commission concluded in its declaratory ruling that disability retirement benefits are payable on the first day of the month following the division's receipt of an approved application for benefits.

Thereafter, the plaintiffs¹⁰ filed an administrative appeal from the commission's declaratory ruling with the trial court. The trial court concluded that the commission's ruling was time-tested and reasonable and, therefore, was entitled to substantial deference. In addition, the trial court observed that neither the legislature nor the parties that had negotiated the terms of SERS had taken steps to change those terms as a result of the commission's interpretation. Moreover, the court reasoned that the commission's interpretation provides an incentive for members to apply promptly for disability retirement benefits, thereby minimizing the need for retroactive payments and maximizing the predictability of the state's financial liability. The court rejected the plaintiffs’ reliance on General Statutes § 5-169 (j),¹¹ which provides in relevant part that "[a] member's date of disability shall be his last date of active employment by the state prior to such disability or the date as of which his benefits under this section are payable," concluding that that provision merely defines the member's date of disability for purposes of calculating benefits and does not specify the date that benefits first become payable. The court also rejected the plaintiffs’ contention that the act should be liberally construed because it is remedial in nature, concluding that it merely sets forth contractual obligations negotiated by the unions and the state. Accordingly, the trial court rendered judgment dismissing the administrative appeal. This appeal followed.

On appeal, the plaintiffs claim that the trial court incorrectly concluded that the commission's interpretation of the act was entitled to deference because that interpretation is neither time-tested nor reasonable. They further claim that, as a fiduciary of SERS and its members, the commission had the burden of proving fair dealing with the plaintiffs by clear and convincing evidence. We address each claim in turn.

I

We begin our analysis with the plaintiffs’ claims that the trial court improperly deferred to the commission's interpretation of the act because that interpretation was neither time-tested nor reasonable in that the applicable statutes clearly and unambiguously provide that benefits become payable on the day after the employee's last day of paid...