Ridge v. Police and Firefighters Retirement and Relief Board

• Decision Date: 26 June 1986
• Docket Number: No. 85-474.,85-474.
• Citation: 511 A.2d 418
• Parties: Thomas E. RIDGE, Petitioner, v. POLICE AND FIREFIGHTERS RETIREMENT AND RELIEF BOARD, Respondent.
• Court: D.C. Court of Appeals

511 A.2d 418

Thomas E. RIDGE, Petitioner, v. POLICE AND FIREFIGHTERS RETIREMENT AND RELIEF BOARD, Respondent.

No. 85-474.

District of Columbia Court of Appeals.

Submitted December 9, 1985.

Decided June 26, 1986.

COPYRIGHT MATERIAL OMITTED

Robert E. Greenberg, Robert E. Deso, and Barry D. Trebach, Washington, D.C., were on brief, for petitioner.

Inez Smith Reid, Corp. Counsel at the time the brief was filed, John H. Suda, Principal Deputy Corp. Counsel, Charles L. Reischel, Deputy Corp. Counsel, and Richard B. Nettler, Assist. Corp. Counsel, Washington, D.C., were on brief, for respondent.

Before NEBEKER, MACK and BELSON, Associate Judges.

MACK, Associate Judge:

The Police and Firefighters Retirement and Relief Board ("the Board") restored disability benefits to an annuitant who had been temporarily above the statutory income limits. We are asked to decide whether the Board should have backdated the annuity payments to the date of eligibility for reestablishment rather than making the reestablished annuity effective only from the later date on which the Board reached its decision. We agree with petitioner Thomas Ridge that the earlier date applies. We hold also that the Board may offset against the reestablished annuity any payments received by the annuitant during what was later recognized as a period of temporary ineligibility. Finally, we hold that the Board's finding of a willful statutory violation was not supported by substantial evidence and, in addition, that the Board failed to give petitioner adequate notice of its threatened action.¹ We reverse.

I

On January 12, 1955, petitioner Thomas Ridge joined the District of Columbia Metropolitan Police Department. He subsequently suffered a disability incurred or aggravated in the course of duty and was retired from his rank as officer on April 1, 1967. After his retirement, petitioner entered into business as the sole proprietor of an Exxon service station. Petitioner used the income from this enterprise to supplement his disability annuity, set by statute at between 66 2/3 and 70% of his average pay for each year of his service. D.C.Code § 4-616(a) (1981).

A disabled annuitant's "earning capacity" is deemed restored, and benefits therefore revoked, if his or her income from wages or self-employment for any calendar year equals at least 80% of the current rate of pay in the position held immediately before retirement. Id. § 4-620(a)(2).² On November 19, 1981, the Board ordered that petitioner's disability annuity be revoked on the ground that his income for calendar year 1980 had risen above the statutory limit.³ Petitioner's annuity payments were stopped forty-five days later, as the statute requires, on January 4, 1982. Id. § 4-620(a)(1)(C).

Although petitioner's income for calendar year 1980 was above the 80% limit, his 1981 earnings fell back below that level, making him eligible for reestablishment of his disability annuity. Id. § 4-620(a)(2).⁴ On April 9, 1982, shortly after the close of the 1981 calendar year which brought him back within the eligibility limits, petitioner formally requested the Board to reinstate his annuity due to his changed circumstances. After a protracted transmission of documents from petitioner to the Board, a hearing on his reestablishment claim was finally held on September 15, 1983. The Board, having examined documentary evidence of petitioner's earnings for 1981 and 1982, and having heard testimony from various individuals including petitioner's Certified Public Accountant, concluded that he was in compliance with the statutory income requirements for those years. On October 4, 1983, the Board issued an order reinstating the annuity effective September 22, 1983, the date on which the Board reached its reestablishment decision one week after the hearing was held.

Petitioner sought review in this court of the Board's determination that September 22, 1983, was the effective date from which his annuity should be reestablished. He argued that the appropriate point for payments to commence was not the date on which the Board—after extended proceedings—arrived at its decision to reinstate the annuity, but rather the earlier date on which he had become eligible for reestablishment. Under this analysis, as we discuss below, he would be entitled not only to payments running from September 22, 1983, but also to payments retroactive to January 1, 1982.

Neither the challenged order of October 4, 1983, nor the decision upon which that order was based, indicated that the Board had ever considered the possibility of backdating the annuity from the date of its reestablishment decision to the date of eligibility. On January 4, 1985, after requesting supplemental briefs on this and other issues, we remanded the case back to the Board to consider and determine the appropriate date for reestablishment of the annuity. Ridge v. Police & Firefighters Retirement & Relief Board, No. 83-1206 (D.C.January 4, 1985) (Ridge I). We suggested, in our unpublished order remanding Ridge I, that "the Board adopt regulations addressing this issue, in order that annuitants may be put on notice of the applicable rules and that future cases may be decided appropriately." Id. at 2.

On April 10, 1985, on remand from Ridge I, the Board affirmed its prior ruling that payments would recommence from September 22, 1983. This is the final decision and order that we now review. The decision set forth the principle that the Board may "withhold reinstatement of an annuity until it is capable of making such a determination." The Board also held that petitioner had willfully failed to provide required information until September 22, 1983, the date on which the decision to reestablish was made, and that his willful delay justified the loss of benefits up to that time. D.C.Code § 4-620(c)(5) (1981). In so finding, the Board introduced a new issue into the case.

Before proceeding to address petitioner's contentions, we note that this case presents a number of questions not expressly answered by the provisions of the governing Police and Firefighters Retirement and Disability Act, D.C.Code §§ 4-601 to 634 (1981) ("the Act" or "the retirement statute"). Specifically, the Act does not set forth the procedure to be followed by either the annuitant or the Board when reestablishing temporarily discontinued payments; it does not expressly indicate whether reestablishment operates retroactively to cover the lapse between the date of eligibility and the date upon which the Board arrives at its reestablishment decision; and the Act offers no express guidance as to whether the Board may offset against the reestablished annuity the payments which the annuitant received during the period before his or her ineligibility became apparent. Despite our prompting in Ridge I, it does not appear that the Board has adopted regulations which would clarify any of these issues.

II

"We may overturn the Board's decision only if its findings are unsupported by substantial evidence in the record as a whole, or if it is grounded on a faulty legal premise." Neer v. District of Columbia Police & Firemen's Retirement & Relief Board, 415 A.2d 523, 526 (D.C. 1980). Substantial evidence is "more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Vestry of Grace Parish v. District of Columbia Alcoholic Beverage Control Board, 366 A.2d 1110, 1112 (D.C. 1976) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 216, 83 L.Ed. 126 (1938)). Bearing these principles in mind, we consider whether the Board properly withheld petitioner's reestablished annuity payments on the ground that he had willfully failed to timely submit information as required under § 4-620(c)(5). We conclude that the Board's action was not supported by substantial evidence; we further hold that, in reaching its finding of a willful statutory violation, the Board failed to observe the notice requirements of due process. The Board's withholding of funds in reliance upon § 4-620(c)(5) was flawed in both respects.

The Board held, on April 10, 1985, that petitioner had willfully failed to timely submit required information and that it was therefore empowered to withhold annuity payments for a period during which petitioner was otherwise eligible for reestablishment. The Board stated that "the annuitant was not cooperative in terms of providing all the necessary information at the outset, thereby resulting in the delay of a determination and decision." For this reason, the Board affirmed its previous decision to reestablish the annuity effective September 22, 1983; the Board held that it possessed adequate information of record no earlier than that date and that petitioner was willfully responsible for the intervening delay. The reestablishment decision which the Board affirmed, however, contained no such finding; our remand of Ridge I did not request the Board to address any possibility of willful delay under § 4-620(c)(5); and at no point, either before or after our remand, did the Board advise petitioner that it was considering the willfulness issue with its potential loss of benefits.

The relevant parts of § 4-620(c)(5) provide:

(A) Any annuitant who is retired . . . and who prior to such retirement was an officer or member of the Metropolitan Police force . . . shall, at such times as the [Board] shall by regulation prescribe,⁵ submit to the [Board] a notarized statement containing such information as the [Board] shall by regulation require with respect to the income received by such annuitant from wages or self-employment, or both. After examining such statement, the [Board] may require such annuitant to submit to the [Board] a further notarized statement containing such additional information with respect to the income received by such annuitant from wages or self-employment, or both, as the [Board] deems appropriate.

(B) . . ....