09-002582 Brian Prince And Wendy P. Rivers vs. Department Of Management Services, Division Of Retirement Status: Closed Recommended Order on Monday, August 10, 2009.

Summary: Where FRS member died before effective retirement date, no continuing retirement benefits were due for her children who were designated beneficiaries, but not joint annuitants.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BRIAN PRINCE AND WENDY P. RIVERS, )

)

Petitioners, )

)

vs. ) Case No. 09-2582

)

DEPARTMENT OF MANAGEMENT )

SERVICES, DIVISION OF RETIREMENT, )

)

Respondent. )

__________________________________)

RECOMMENDED ORDER

Pursuant to notice, this cause was heard by Linda M. Rigot,

the assigned Administrative Law Judge of the Division of

Administrative Hearings, on July 22, 2009, in Tallahassee,

Florida.

APPEARANCES

For Petitioners: Brian Prince, pro se

1063 Walden Road

Tallahassee, Florida 32317

For Respondent: Elizabeth Regina Stevens, Esquire

Department of Management Services

Office of the General Counsel

4050 Esplanade Way, Suite 160

Tallahassee, Florida 32327

STATEMENT OF THE ISSUE

The issue presented is whether Petitioners are entitled to

Option 2 continuing retirement benefits following the death of

Linda Prince, a Florida Retirement System member.

PRELIMINARY STATEMENT

By correspondence dated March 2 and March 11, 2009,

Respondent Department of Management Services, Division of

Retirement, notified Petitioners Brian Prince and Wendy P.

Rivers that their request for continuing retirement benefits

following the death of their mother Linda J. Prince was denied,

and Petitioners timely requested an administrative hearing

regarding that determination. This cause was thereafter

transferred to the Division of Administrative Hearings to

conduct the evidentiary proceeding.

Petitioners presented the testimony of Annie Lamb,

Samantha Andrews, Harrison T. Rivers, and Harrison W. Rivers.

Respondent presented the testimony of Brian D. Prince and

Paula Kazmirski. Additionally, Petitioners' Exhibit numbered 1

and Respondent's Exhibits numbered 1-9 were admitted in

evidence.

At the commencement of the final hearing, the style of this

case was amended to reflect that both Brian Prince and Wendy P.

Rivers are the Petitioners in this cause.

No transcript of the final hearing has been filed.

Petitioners and Respondent have, however, filed proposed

recommended orders, and those documents have been considered in

the entry of this Recommended Order.

FINDINGS OF FACT

1. Linda J. Prince was employed by the Florida Department

of Law Enforcement (hereinafter "FDLE") and was a vested,

regular class member of the Florida Retirement System

(hereinafter "FRS").

2. After she was diagnosed with a serious health

condition, she was able to continue as a full-time employee by

participating in the Department's sick leave pool. By

November 2008 her family understood that she was terminally ill.

About that time, she began alternating staying at the home of

her son Brian Prince and at the home of her daughter and son-in-

law Wendy and Harrison T. Rivers.

3. During the first week of November 2008, her son,

daughter, and son-in-law began discussing whether she should

retire rather than remaining in full-pay status. Harrison T.

Rivers asked his father Harrison W. Rivers for advice since his

father was a retired member of FRS. His father told him that

Linda Prince should retire right away under Option 2 since that

would guarantee a 10-year payout.

4. One of the persons that Harrison T. Rivers contacted

for advice referred him to Annie Lamb, a Personnel Services

Specialist at FDLE. He remembers asking her about Option 2 and

understood her to tell him that Option 2 required having a

spouse or other dependents. She does not recall the

conversation.

5. When Harrison T. Rivers conveyed his understanding to

Brian Prince, Brian requested that a meeting be set up at FDLE's

Personnel Office. The two men met with Samantha Andrews, a

different FDLE Personnel Services Specialist, near the end of

2008.

6. All three persons attending the meeting recall that

they discussed the sick leave pool, and the two men were assured

that there were enough donations to the sick leave pool to cover

Linda Prince's continuing need. The attendees at the meeting

have different recollections of the other matters discussed.

The two men believe they discussed Option 2 and that

Samantha Andrews called across the hall to Annie Lamb who

confirmed that Option 2 required a spouse. Lamb recalls Andrews

asking her a question but does not remember what the question

was. Andrews does not recall asking Lamb a question and further

does not recall discussing the retirement options at the

meeting.

7. At the final hearing, Andrews admitted that she did not

understand the differences among the four retirement options

until after Linda Prince's death and that before then she

thought that one had to be a spouse or a dependent child to be a

beneficiary. Andrews' impression of the meeting is that

Linda Prince's children wanted to be sure she remained in full-

pay status through the sick leave pool to increase her income

and keep her benefits available and at a reasonable cost.

8. After this meeting, Linda Prince remained on full-pay

employment status. As a result, she received (1) her full

salary rather than a reduced retirement amount, (2) health

insurance at a cost of $25 bi-weekly, and (3) a $44,000 life

insurance policy at the cost of $2 bi-weekly. If she had

retired, she would have had to pay nearly $500 a month for the

health insurance and would have lost her $44,000 life insurance

policy. Instead, she would have had the option of purchasing

either a $10,000 or $2,500 life insurance policy for $29.65 or

$7.41 a pay period, respectively.

9. On January 10, 2009, Harrison W. Rivers was visiting at

his son's home while Linda Prince was staying there. In a

conversation with her, he was surprised to learn that she had

not retired as he had strongly advised two months earlier. When

he later questioned his son as to why she had not retired, his

son told him because she did not have a spouse. Harrison W.

Rivers told his son that that information was not correct.

10. On January 20, 2009, Harrison W. Rivers met with his

own financial advisor David A. Wengert and relayed the

information his son had given him. Wengert agreed with Rivers

that the information about a spouse or dependent child was not

correct but checked with a contact he had at the Department of

Corrections. That person confirmed that the spouse or dependent

child requirement did not apply to Option 2 and faxed the

necessary forms for retiring under Option 2 to Wengert who gave

them to Rivers.

11. Harrison W. Rivers gave the folder from Wengert

containing the correct information and required forms to his son

and told his son to retire Linda Prince immediately. His son

subsequently called Brian Prince, gave him the correct

information, and told him that Linda Prince should retire.

Brian Prince agreed but was out of town at the time.

12. On February 11, 2009, Harrison T. Rivers drove

Annie Lamb from FDLE to where Linda Prince was staying. The

forms were completed and signed, and Lamb notarized

Linda Prince's signature. The forms provided for Linda Prince

to take early retirement under Option 2 with Brian Prince and

Wendy Rivers as her equal beneficiaries.

13. The forms were filed with Respondent, the Department

of Management Services, Division of Retirement, the same day.

The forms she signed selected February 28, 2009, as

Linda Prince's termination of employment date. A termination

date of February 28, 2009, resulted in a March 1, 2009,

retirement date.

14. Linda Prince died on February 14, 2009. On that date,

she was still in full-pay status since she had not terminated

her employment and retired.

15. Option 2 under the FRS system provides a reduced

monthly benefit payable for the member's lifetime, but if the

member dies within ten years after his or her retirement date,

the designated beneficiary receives a monthly benefit in the

same amount for the balance of the ten-year period, and then no

further benefits are payable.

16. Option 1 provides for monthly payments for the

member's lifetime, and upon the member's death, no further

monthly benefits are payable. It, therefore, pays no continuing

benefits to a beneficiary. Options 3 and 4 provide for joint

annuitants and reduced monthly benefits. Under Option 3, upon

the member's death, the joint annuitant, who must be a spouse or

a financial dependent, will receive a lifetime monthly benefit

payment in the same amount, but there are limitations on the

amount and length of those payments for a joint annuitant under

25 who is not a spouse. Option 4 provides an adjusted monthly

benefit while the member and the joint annuitant are living, a

further reduced monthly benefit after the death of either the

member or the joint annuitant, with adjustments if the joint

annuitant is under the age of 25 and not a spouse. No benefits

are payable after both the member and the joint annuitant are

deceased. Thus, only Options 3 and 4 require a spouse or

financial dependent in order for continuing benefits to be paid

after the member's death.

17. Upon learning of her death, the Division of Retirement

researched whether any benefits were due to Linda Prince or her

beneficiaries. Since she had paid nothing into the FRS, there

were no contributions to refund. Further, since she had not

retired, no retirement benefits were payable to her or her

beneficiaries. The Division also looked at the dates of birth

of her beneficiaries to determine if a beneficiary would qualify

as a joint annuitant, but both of her beneficiaries were over

the age of 25.

18. The only time that Linda Prince contacted the Division

of Retirement was in 2002 when she sent an e-mail asking that

her benefits be calculated as to what she would receive if she

retired at age 62. The Division performed the calculations and

sent her the information as to what her benefits would be under

Options 1 and 2. Her file contains her e-mail, the benefits

estimates sent to her, and a copy of an informational retirement

brochure.

19. Information on the FRS, including descriptions of the

Options, has been available on the Division's website, in

employee handbooks available from the Division, and was

available in written form in FDLE's Personnel Office on the day

that Brian Prince and Harrison T. Rivers met with

Samantha Andrews. During that meeting, neither Brian Prince nor

Harrison T. Rivers requested a copy of the employee handbook or

any written materials describing the Options for retirement.

20. Because of Petitioners' estoppel argument, the

chronology in this case must be closely reviewed. At least

until early November 2008, Linda Prince had made her decision to

stay on full-pay status to receive her full salary and benefits

rather than take early retirement. In early November, her son,

daughter, and son-in-law became involved in that decision. In

early November, her son-in-law understood an FDLE employee to

say that Linda Prince needed a spouse or financial dependent to

qualify for continuing retirement benefits, but his father, who

was a retired member of FRS, told him that information was wrong

and that Option 2 would provide a ten-year continuing benefit

for her beneficiaries. No contact was made on her behalf with

the Division of Retirement to ascertain which information was

correct.

21. On January 10, 2009, Harrison W. Rivers, upon learning

that Linda Prince was still not retired, again told his son that

she should be retired under Option 2 and that his son's

understanding that she needed a spouse or financial dependent

was wrong. Again, no contact was made with the Division of

Retirement.

22. On January 20, 2009, Harrison W. Rivers obtained the

written information and required forms. Within a few days he

gave the information and forms to his son and told him again to

see to it that Linda Prince was retired immediately. Yet, the

forms were not executed and filed with the Division of

Retirement until February 11, 2009.

23. Had Linda Prince or anyone on her behalf contacted the

Division of Retirement to clarify which information was correct

once they had conflicting information the first week of

November 2008, she could have retired starting December 1. Had

Linda Prince or anyone on her behalf submitted her application

for retirement when Harrison W. Rivers provided the correct

information and forms to use in January 2009, she could have

retired then with a February 1 retirement date.

24. Even though Petitioners offered evidence to show that

they relied upon erroneous information conveyed by Harrison T.

Rivers and even though they offered evidence that they received

erroneous information from Samantha Andrews, it would have been

clear to a reasonable person that such information conflicted

with the information given by Harrison W. Rivers, who had gone

through the process. Further, in January when Rivers gave them

the correct written information and the forms to use, there was

no basis for relying upon the erroneous information. If

Petitioners had acted to clarify the previous conflicting

information or had not delayed in having Linda Prince execute

the forms when Rivers provided them, they would have retired her

before her death and would have been entitled to continuing

benefits. Whatever circumstances caused the further delay in

the filing of Linda Prince's application for retirement and

supporting documentation, the delay was not caused by the

information, erroneous or not, provided by the FDLE employees.

25. Accordingly, Linda Prince was still a full-time

employee at the time of her death not as a result of erroneous

information provided by FDLE employees as alleged by

Petitioners, but as a result of delay in obtaining the easily-

accessible correct information from the Division of Retirement

and as a result of delay in acting on the correct information

when it was provided to them.

26. There are over 960 agencies, including state

departments and local governments and school boards, which

participate in the FRS. The employer and employee handbooks

distributed to those agencies and their employees by the

Division of Retirement clearly state that representatives of

participating agencies are not the agents of the Division of

Retirement but rather only act as a link between employees and

the Division of Retirement.

CONCLUSIONS OF LAW

27. The Division of Administrative Hearings has

jurisdiction over the subject matter hereof and the parties

hereto. §§ 120.569 and 120.57(1), Fla. Stat.

28. The FRS is codified in Chapter 121, Florida Statutes.

Pursuant to Section 121.1905, Florida Statutes, the Division of

Retirement was created to administer the FRS. The Division is

guided by its own rules found in Chapter 60S-4, Florida

Administrative Code.

29. Retiring FRS members submit certain documents to the

Division for the administration of their retirement benefits.

These documents include the Application for Service Retirement,

Option Selection for FRS Members Form, and the Beneficiary

Designation Form. Linda Prince filed all of these forms with

the Division on February 11, 2009.

30. The four options available to retiring members are

provided on the Option Selection Form. She chose Option 2 which

is defined by Section 121.091(6)(a)2., Florida Statutes, as

follows:

A decreased retirement benefit payable to

the member during his or her lifetime and,

in the event of his or her death within a

period of 10 years after retirement, the

same monthly amount payable for the balance

of such 10-year period to his or her

beneficiary . . . .

31. Although Linda Prince selected Option 2, an option

selection is null and void if the member dies before the

effective date of retirement. § 121.091(6)(e), Fla. Stat.

Florida Administrative Code Rule 60S-4.0035(3)(a) defines the

effective date of retirement as follows:

For a member who makes application for a

normal or early retirement benefit . . . the

effective retirement date shall be the first

day of the month following the month in

which the member's termination occurs. . . .

32. Since Linda Prince's termination date was February 28,

2009, her effective retirement date was March 1, 2009. Since

she died prior to this date, her option selection is null and

void.

33. Section 121.091(7)(b), Florida Statutes, provides:

If the employment of an active member who

may or may not have applied for retirement

is terminated by reason of his or her death

subsequent to becoming vested and prior to

his or her effective date of retirement, if

established, it shall be assumed that the

member retired as of the date of

death. . . . Benefits payable to the

designated beneficiary shall be as follows:

* * *

2. For a beneficiary who does not qualify

as a joint annuitant, no continuing monthly

benefit shall be paid and the beneficiary

shall be entitled only to the return of the

member's personal contributions.

Accordingly, when a member dies before his or her effective

retirement date and is vested, as Linda Prince was, only

beneficiaries who qualify as joint annuitants will be entitled

to a continuing benefit.

34. The term "joint annuitant" is defined by Section

121.021(28), Florida Statutes, as any person designated by the

member to receive a retirement benefit upon the member's death

who is also the member's spouse; the member's natural or adopted

child under age 25; the member's physically or mentally disabled

child incapable of self-support, regardless of age; a person

under age 25 who is financially dependent on the member and for

whom the member is the legal guardian; or the member's parent or

grandparent or a person aged 25 or older for whom the member is

the legal guardian and who is financially dependent on the

member.

35. Petitioners do not qualify as joint annuitants under

the statutory definition. Petitioners are not entitled,

therefore, to a continuing retirement benefit. See Walker v.

Dep't. of Management Servs., Div. of Retirement , DOAH Case No.

02-0213 (F.O. 12/30/02).

36. Petitioners allege that Linda Prince's application for

retirement would have been filed earlier and she would have

lived until her effective retirement date if they had not been

given incorrect information from FDLE. In effect, Petitioners

rely on the doctrine of equitable estoppel in seeking continuing

benefits from FRS. This tribunal does not have jurisdiction to

grant equitable remedies. § 26.012, Fla. Stat.

37. Even if there were jurisdiction to award equitable

relief in this proceeding, Petitioners would have the burden of

proving the following elements: (1) a representation by a party

as to some material fact, (2) reliance on that representation by

the party claiming estoppel, and (3) a change in the party's

position caused by his or her reliance on the representation to

his detriment. See , e.g. , Shaffer v. Sch. Bd. of Martin County ,

543 So. 2d 335 (Fla. 4th DCA 1989).

38. Further, as a general rule, estoppel may be applied

against the state only in rare instances or under exceptional

circumstances. Dolphin Outdoor Advert. v. Dep't. of Transp. ,

582 So. 2d 709 (Fla. 1st DCA 1991). Petitioners must also show

affirmative conduct, not merely negligence, that they relied

upon to their detriment. Martin County v. Indiantown Enter.,

Inc. , 658 So. 2d 1144 (Fla. 4th DCA 1995).

39. Petitioners have not proven a factual basis for

applying equitable estoppel in this proceeding. First, there is

no evidence that the Division of Retirement represented a

material fact to them. Rather, the evidence is clear that

Petitioners did not contact the Division in the face of

conflicting information. Second, there is no evidence that

Petitioners relied on a representation made by the Division of

Retirement. Third, there is no evidence that Petitioners

changed their position to their detriment due to their reliance

on a representation made by the Division.

40. Petitioners' testimony regarding advice received from

FDLE employees has not been corroborated by those employees.

Rather, the impression of the FDLE employee who attended the

meeting is that Petitioner's son and son-in-law wanted to make

sure Linda Prince could remain in full-pay status to receive her

full salary and benefits. The evidence is clear that

Petitioners were given conflicting information about the same

time that they were obtaining information from FDLE; yet, they

did nothing to resolve the conflict. Further, once they were

given the indisputably correct information, they delayed acting

on it in a timely manner for personal reasons, not through some

action on the part of FDLE.

41. Even if the alleged misrepresentation were made, FDLE

is a separate entity from the Division of Retirement, and

representations made by FDLE cannot be attributed to the

Division. Bright v. Dep't. of Mgmt. Servs., Div. of Ret. , DOAH

Case No. 03-2142 (F.O. 4/8/04). FRS employers and their

employees are advised that FRS employers are not agents of the

Division and cannot bind the Division. The public policy

implications of binding the Division by statements made by a

representative of any other participating entity are obvious.

This non-agent position has been affirmed by case law and has

recently been codified by the Legislature in CS/CS/HB 479.

Section 1 of Chapter 2009-209, Laws of Florida, effective

July 1, 2009, provides that: "Employers are not agents of the

department, the state board, or the Division of Retirement, and

the department, the state board, and the division are not

responsible for erroneous information provided by

representatives of employers."

42. Petitioners bear the burden of proof in this

proceeding. See Fla. Dep't. of Transp. v. J.W.C. Co. , 396 So.

2d 778 (Fla. 1st DCA 1981); Balino v. Dep't. of Health and

Rehab. Servs. , 348 So. 2d 349 (Fla. 1st DCA 1977); and Young v.

Dep't. of Cmty. Affairs , 625 So. 2d 831 (Fla. 1993).

Petitioners have failed to meet this burden by proving their

allegations by a preponderance of the evidence.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that a final order be entered finding

Petitioners ineligible for an Option 2 benefit from the FRS

retirement account of Linda Prince.

DONE AND ENTERED this 10th day of August, 2009, in

Tallahassee, Leon County, Florida.

S

LINDA M. RIGOT

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone]

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 10th day of August, 2009 .

COPIES FURNISHED:

Brian Prince

1063 Walden Road

Tallahassee, Florida 32317

Harrison Rivers

4211 Camden Road

Tallahassee, Florida 32303

Elizabeth Regina Stevens, Esquire

Department of Management Services

Office of the General Counsel

4050 Esplanade Way, Suite 160

Tallahassee, Florida 32327

Sarabeth Snuggs, Director

Division of Retirement

Department of Management Services

Post Office Box 9000

Tallahassee, Florida 32315-9000

John Brenneis, General Counsel

Department of Management Services

4050 Esplanade Way, Suite 160

Tallahassee, Florida 32399-0950

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.