Sheppleman v. City of Chester Aggregated Pension Fund
| Decision Date | 29 December 2021 |
| Docket Number | 458 C.D. 2020 |
| Citation | 271 A.3d 938 |
| Parties | Stephen SHEPPLEMAN v. CITY OF CHESTER AGGREGATED PENSION FUND, Appellant |
| Court | Pennsylvania Commonwealth Court |
John P. McLaughlin, Bala Cynwyd, for Appellant.
Robert C. Ewing, Media, for Appellee.
BEFORE: HONORABLE P. KEVIN BROBSON, President Judge, HONORABLE ANNE E. COVEY, Judge (P.), HONORABLE MICHAEL H. WOJCIK, Judge
OPINION BY JUDGE WOJCIK
The City of Chester (City) Aggregated Pension Fund (Fund), which is administered by the City's Aggregated Pension Fund Board (Board), appeals from the April 22, 2020 order of the Delaware County Court of Common Pleas (trial court) accepting and approving Stephen Sheppleman's (Sheppleman) proposed findings of fact and conclusions of law, and directing the Fund to recalculate Sheppleman's service-connected disability pension award from the date of his disabling work injury on February 22, 2011, as opposed to the date that the Board approved his service-connected disability retirement on March 13, 2013. The Fund contends that the trial court violated its standard of review, misinterpreted the term "retirement," and erred by ordering the recalculation of benefits. Upon review, we affirm.
Pursuant to the parties’ stipulations, Sheppleman was employed as a police officer for the City, beginning in April 1999. The City is a municipality, incorporated as a Third Class City, operating under a Home Rule Charter and Administrative Code adopted pursuant to the Home Rule Charter and Option Plans Law (Home Rule Charter Law).1 Pursuant to this authority, the City created the Fund as the funding mechanism for the Police Pension Fund2 and created the Board to serve as trustee and administrator of the Fund. Stipulated Facts (S.F.) Nos. 1-5; Reproduced Record (R.R.) at 270a.
Section 143.03(f) of the Police Pension Ordinance (Ordinance), codified in Article 143 of the City's Administrative Code, provides:
Beginning January 1, 1982, any police officer who becomes permanently and totally disabled as a result of an injury incurred while in the actual performance of his or her duty and who, by reason thereof, is unable to perform his or her duties as a member of the police force shall be entitled upon application to the Board to retire and to receive a monthly pension. Such pension shall be in an amount equal to one hundred percent (100%) of such police officer's average monthly earnings reportable or reported on the police officer's W-2 form for the twelve month period prior to his or her retirement.
Section 143.03(f) of the Ordinance (emphasis added); see S.F. Nos. 5-6; R.R. at 24a, 270a-71a. This language is consistent with Article XXIII of the collective bargaining agreement (CBA) between the City and the Fraternal Order of Police, Lodge No. 19, effective from January 1, 2012, to December 31, 2016. S.F. No. 7; R.R. at 271a.
Sheppleman participated in the Fund. On February 22, 2011, he suffered an injury while on duty, when he slid on ice and snow and aggravated a prior work injury. Sheppleman underwent multiple surgeries3 and received indemnity benefits pursuant to the Workers’ Compensation Act4 and the act commonly referred to as the Heart and Lung Act.5 During this time, he was not eligible for, and did not receive, overtime from the City. For the 12-month period preceding the February 22, 2011 injury, Sheppleman earned $86,823.48. Following his injury, his Internal Revenue Service W-2 Form (W-2 Form) for 2012 showed wages of $438.96 in box 1 and workers’ compensation payments of $62,431.14 in box 14; his W-2 Form for 2013 similarly showed wages of $13.27 in box 1 and workers’ compensation payments of $65,094.12 in box 14. Sheppleman was never able to return to work after the February 22, 2011 injury. An application was made on his behalf to the Board requesting service-connected disability benefits. In accordance with the Ordinance, Sheppleman submitted to three required medical examinations. On March 13, 2013, the Board voted to approve service-connected disability benefits for Sheppleman. S.F. Nos. 8-16, 19, Exhibit H; R.R. at 271a, 348a.
In July 2014, Sheppleman received a fact sheet from the City regarding his pension calculation. On July 25, 2014, Sheppleman received his first pension payment. 6
The pension calculations were based on the 12-month period preceding the Board's March 13, 2013 decision. The Board utilized Sheppleman's W-2 Forms from 2012 and 2013, which were based on Sheppleman's compensation under the Heart and Lung and Workers’ Compensation Acts, and did not take into account any pre-injury earnings, which had included overtime earned for assignments such as SWAT call outs, dive team call outs, narcotics work, training, and court time. S.F. Nos. 17-19; R.R. at 272a; Trial Court Op., 7/6/20, at 6.
Upon learning of the calculation methodology, Sheppleman wrote to Edith Blackwell, the City Controller and member of the Board (City Controller), and asserted that his disability benefit should be calculated based on his pre-injury earnings. According to Sheppleman's calculation, this adjustment would result in a $7,235.29 monthly benefit, as opposed to the $5,327.25 that he was awarded. S.F. Nos. 20-22; R.R. at 272a.
The Board previously calculated other disability pensions from the date of injury or application for benefits. Specifically, on March 24, 2010, the Board voted to grant a full disability pension to police officer Joseph Kane retroactive to the "date of his injury" on December 11, 2006. On March 24, 2010, the Board granted police officer Kevin Gyda, who was injured on October 3, 2005, a disability pension calculated as of the date of his application for service-connected disability benefits, pursuant to an arbitration award. On May 23, 2012, the Board granted police officer Regina Butcher a disability pension that was calculated as of the date of her injury on June 6, 2009. S.F. Nos. 23-25; R.R. at 272a.
On October 24, 2016, Sheppleman filed a Complaint in the trial court against the Fund challenging the calculation of his disability pension. S.F. No. 26; R.R. at 272a. Following discussions with counsel, and by stipulation and agreement of the parties, the trial court remanded the case to the Board for a local agency hearing. S.F. No. 27; R.R. at 69a, 272a-73a. By adjudication dated December 18, 2019, the Board determined that Sheppleman's pension benefit was properly calculated under the terms of the Ordinance, the CBA, and case law. R.R. at 73a-82a. Thus, the Board denied Sheppleman's request for a recalculation of benefits based on the 12-month period preceding his date of injury. Id. From this decision, Sheppleman filed a local agency appeal with the trial court on December 31, 2019.
Before the trial court, the parties further stipulated that: the trial court's review was governed by Section 754(b) of the Local Agency Law, 2 Pa. C.S. § 754(b) ; a complete record was created before the Board; neither party could supplement the record; and the parties would file proposed findings of fact and conclusions of law with the trial court. R.R. at 315a.
By order dated April 22, 2020, the trial court determined that Sheppleman timely filed his appeal within 30 days of the Board's December 18, 2019 adjudication; accepted Sheppleman's proposed findings of fact and conclusions of law in their entirety; and concluded that the Board's calculation of Sheppleman's disability pension utilizing post-injury compensation violated the terms of the Ordinance, the CBA, and the Third Class City Code (City Code),7 as well as his constitutional right to equal protection.
From this decision, the Fund appealed. In its statement of questions presented, the Fund challenged the timeliness of Sheppleman's appeal; whether the trial court exceeded its review under the Local Agency Law; and whether the Board's calculation was in conformance with the Ordinance, the CBA, the City Code, and constitutional provisions. The Fund also asserted that the trial court violated the Municipal Pension Plan Funding Standard and Recovery Act (Act 205)8 by ordering the Fund to recalculate Sheppleman's pension benefit without an actuarial study.
In its supporting opinion filed July 6, 2020, the trial court articulated that Sheppleman's appeal was timely filed because the Board's March 13, 2013 approval of Sheppleman's service-connected disability pension was not an "adjudication" for purposes of the 30-day appeal deadline. Trial Court Op., at 8 (citing Section 5571(b) of the Judicial Code, 42 Pa. C.S. § 5571(b) ). "No adjudication of a local agency shall be valid as to any party unless he shall have been afforded reasonable notice of a hearing and an opportunity to be heard." Id. at 9 (quoting Section 553 of the Local Agency Law, 2 Pa. C.S. § 553 ). There was no hearing before the calculation of the pension. Sheppleman was not notified of the calculation until July 2014, when he received the fact sheet regarding the calculation. Despite contacting City Controller, Sheppleman was never afforded an opportunity to challenge the calculation before the Board. Consequently, the trial court determined that the original complaint, filed on October 24, 2016, was not subject to the 30-day appeal deadline. Sheppleman's subsequent local agency appeal was timely filed within 30 days of the Board's December 18, 2019 decision upholding the calculation. The trial court also noted that the Fund's stipulation to remand the matter to the Board for a local agency hearing should be considered a waiver of any future claims of an untimely appeal. Trial Court Op., at 8-12.
As for the trial court's standard of review, the trial court cited Sections 753 and 754 of the Local Agency Law, 2 Pa. C.S. §§ 753, 754, as the applicable standard. Trial Court Op., at 13. Section 754(b) provides that where a complete record is made before the local agency, the court shall affirm the adjudication unless it shall find that the adjudication is...
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