98-003066 Ronald Hodge vs. Division Of Retirement Status: Closed Recommended Order on Wednesday, April 28, 1999.

Summary: Evidence did not show that Petitioner could change to ordinary retirement after he had recieved disability benefits. No estoppel since no misrepresentation was made.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RONALD HODGE, )

)

Petitioner, )

)

vs. ) Case No. 98-3066

)

DIVISION OF RETIREMENT, )

)

Respondent. )

___________________________________)

RECOMMENDED ORDER

This matter came before Diane Cleavinger, a duly-designated

Administrative Law Judge of the Division of Administrative

Hearings, on March 24, 1999, on Respondent's Motion for Final

Summary Order.

APPEARANCES

For Petitioner: Anthony J. Salzman, Esquire

Moody and Salzman, P.A.

Post Office Drawer 2759

Gainesville, Florida 32602

For Respondent: Emily Moore, Esquire

Division of Retirement

Cedars Executive Center

Building C

2639 North Monroe Street

Tallahassee, Florida 32399-1560

STATEMENT OF THE ISSUE

Whether Respondent should grant Petitioner's request to

change Petitioner's type of retirement from In-Line-Of-Duty

(ILOD) disability retirement to regular service retirement, after

he had made application for ILOD and received some of those

benefits.

PRELIMINARY STATEMENT

By letter dated March 18, 1998, Respondent notified

Petitioner that it was denying Petitioner's request to change

from ILOD disability retirement to regular service retirement.

Petitioner thereafter filed a petition contesting the denial and

requesting a formal administrative hearing. The matter was

referred to the Division of Administrative Hearings.

Prior to the scheduled hearing, Respondent filed a Motion

for Summary Final Order, with a supporting affidavit. This

Motion was heard telephonically on March 24, 1999. Petitioner

agreed that the case would be most economically and efficiently

resolved on the Motion for Summary Final Order. At the

conclusion of the Motion hearing, the Administrative Law Judge

authorized the filing of proposed recommended orders.

The parties filed proposed recommended orders on April 9,

1999.

FINDINGS OF FACT

1. Petitioner, Ronald Hodge, was employed under the Florida

Retirement System (FRS) for 31.34 years. On December 19, 1996,

he filed the Application for In-Line-Of-Duty (ILOD) Disability

Retirement, Form FR-13, with Respondent, Florida Division of

Retirement. The Application for ILOD Disability Retirement was

signed by Petitioner in the presence of a notary public. In the

lines of text immediately before Petitioner's signature, the

Application for ILOD Disability Retirement provides, in relevant

part:

. . . . I also understand that I cannot add

additional service change options, or change

my type of retirement (Regular, Disability,

and Early ) once my retirement becomes final.

My retirement becomes final when any benefit

payment is cashed or deposited. (emphasis

added)

See also Rule 60S-4.002(4), Florida Administrative Code.

2. On February 19, 1997, Petitioner was accepted as

permanently and totally disabled by the State of Florida and

began receiving Workers' Compensation permanent total disability

benefits for the same accident for which his ILOD disability

benefits were accepted by the Division of Retirement.

3. On April 25, 1997, the Division notified Petitioner that

his application for ILOD disability benefits had been approved,

but that since he also qualified for regular retirement benefits,

he had several options available to him. With the letter of

April 25, 1997, he was given four different estimates of

retirement benefits. He was further advised to send his decision

in writing.

4. The letter of April 25, 1997, also advised Petitioner

that "You have the option of choosing the type of retirement you

wish to receive . . . . If you decide to change from disability

to service retirement, complete the enclosed application for

service retirement, Form FR-11 and return it also." No deadline

for changing his service retirement was specified in the letter.

At the time of the April 25, 1997, letter Petitioner had not

received any retirement benefit payments.

5. Petitioner responded to the Division's April 25, 1997,

letter on May 4, 1997. Petitioner clarified that he had ". . .

selected F.R.S. ILOD (In-Line-Of-Duty) disability benefit Option

2 . . ." His decision was based on the estimates of benefits

enclosed in the Division's letter of April 25, 1997.

6. In June 1997, Petitioner began to receive disability

retirement benefits in the monthly amount of $1,850.33.

7. In May 1997, in a case in which neither Petitioner nor

Respondent was a party, the Florida Supreme Court ruled that ILOD

disability retirement benefits paid to recipients of Workers'

Compensation benefits could be used to offset/reduce Workers'

Compensation benefits. Escambia County Sheriff's Department v.

Grice , 692 So. 2d 896 (Fla. 1997).

8. Importantly, Respondent was not aware at the time that

it sent the estimates of benefits to Petitioner in April 1997, of

the Supreme Court's decision in Escambia County Sheriff's

Department v. Grice , 692 So. 2d 896 (Fla. 1997), in May 1, 1997.

However, Respondent was aware of the decision before the election

was made and before the first benefit was paid of prior decisions

in Barragan v. City of Miami , 454 So. 2d 252 (Fla. 1989), and

Brown v. S.S. Kresge Co. , 305 So. 2d 191 (Fla. 1974), which limit

the combination of such benefits to 100 percent of a claimant's

average weekly wage. However, these decisions did not address

the offset issue. Respondent never informed Petitioner of this

potential reduction when advising him of the selection options.

9. In September 1997, the State of Florida began to take an

offset against Petitioner's Workers' Compensation benefits for

his disability retirement benefits, thereby reducing the total

amount of his Workers' Compensation benefits. If Petitioner had

been receiving service retirement benefits, no offset against his

Workers' Compensation benefits would have been taken.

10. Based on the effect of the Grice , decision supra .

Petitioner sought to change his type of retirement from ILOD

disability retirement to regular service retirement.

11. Petitioner's retirement benefit has never been reduced.

12. Petitioner, subsequently filed Application for Service

Retirement, Form FR-11, notarized on October 8, 1997, and by

letter dated October 7, 1997, which advised that he " . . . had

decided to change from disability to service retirement. . . ."

13. Petitioner's Application for Service Retirement was

cancelled by Respondent on November 4, 1997, with notice to

Petitioner that Respondent's records indicated that he was added

to the June 1997 Retired Payroll under ILOD Electronic Fund

Transfer (EFT) monthly benefit. Because benefit payments had

been deposited, Petitioner's retirement was final.

14. By letter dated December 8, 1997, Petitioner requested

reconsideration by the Respondent of its decision to cancel his

Application for Service Retirement and to deny his request to

change his type of retirement. He stated that he was " . . . not

receiving the benefits I was led to believe I would receive

because of setoffs taken by the state of Florida on my Workers'

Compensation benefits . . . ." He further stated he was misled

in that the Division representative informed him that he could

change from disability retirement to service retirement by just

completing the Form FR-11.

15. At best, the letter of April 25, 1997, is ambiguous as

to when the election to change types of benefits could be made

and as to whether this letter superseded the previous statement

in the original application for ILOD benefits signed by

Petitioner that stated he could not change his election of

benefits once benefits had been paid. However, the ambiguity in

the letter does not constitute a misrepresentation of fact by the

Division. The letter simply did not address the issue.

Moreover, Petitioner was aware of the language in Form FR-13 that

benefit elections were final once benefits were received.

16. Respondent has never reduced or offset any member's

benefit, whether disability or regular service retirement, due to

receipt of any other benefit. In short, Petitioner's retirement

benefit is not being reduced. Moreover, the reduction in

Petitioner's Workers' Compensation benefits was not due to

Respondent's fault, action, or representation to Petitioner.

17. At the time of retirement, Pe titioner was eligible to

receive either service retirement because of his more than 30

years of service, or disability retirement because of his ILOD

injury. If Mr. Hodge were to be granted service retirement

benefits rather than disability retirement benefits, his total

monthly payments from the State of Florida (retirement and

Workers' Compensation) would be substantially increased.

CONCLUSIONS OF LAW

18. The Division of Administrative Hearings has

jurisdiction over this subject matter of and the parties to this

proceeding Section 120.57(1), Florida Statutes.

19. The Florida Retirement System (FRS) is established in

Chapter 121, Florida Statutes. There is no dispute that Mr.

Hodge is a member of the system and that at the time of his

retirement he would have been entitled to select either regular

retirement benefits based on his 30-plus years of service, or

disability benefits based on his ILOD disability.

20. Section 121.091, Florida Statutes, directs how benefits

are paid under the FRS; it does not authorize the Respondent to

alter the type of retirement benefits once a selection of the

type of retirement is final. Further, Respondent has duly

promulgated rules, including the Form FR-13, Application for

Retirement, which expressly prohibits a change in the type of

retirement such as is requested by the Petitioner once a benefit

payment is deposited. See Rule 60S-4.002(4), Florida

Administrative Code. In short, Respondent has neither statutory

nor regulatory authority to change Petitioner's type of

retirement once benefit payments are made to him.

21. The representations made by the Respondent to

Petitioner concerned the types and taxable status of FRS

retirement benefits. Respondent's representations did not

concern any type of Workers' Compensation benefits. Moreover, it

is unlikely that Respondent could make any representations

concerning Workers' Compensation benefits. No representations

were made regarding any offset or reduction of Petitioner's

Workers' Compensation benefits based on Petitioner's selection of

ILOD disability retirement benefits since Respondent had no

knowledge of any such offset or reduction to Petitioner's

Workers' Compensation benefit. In fact, the law in this regard

changed after Respondent's April 1997, representations to

Petitioner. See Grice , supra . The representations as to the

amount of retirement benefits Petitioner could receive made by

Respondent were accurate when made. In fact, those

representations remain accurate to date, since Petitioner's

retirement benefits have not been reduced.

22. The elements of equitable estoppel against the State

are: (1) a representations to a material fact that is contrary

to a later-asserted position; (2) reliance on that

representation; and (3) a change in position detrimental to the

party claiming estoppel, caused by the representation and

reliance thereon. Kuge v. State, Department of Administration,

Division of Retirement , 449 So. 2d 389, 391 (Fla. 3d DCA 1984);

See also Bobby Scott v. Department of Management Services,

Division of Retirement , Case No. 96-3761 (Div of Ret. July 30,

1997).

23. Kuge v. State, Department of Administration, Division

of Retirement , supra , involved a Petitioner who was told by the

Division of Retirement she would be eligible for retirement

benefits based on two prior periods of employment in state

government. Based on these assurances by the Division of

Retirement, Kuge chose her date of retirement. She was

subsequently notified by the Division that she had only 9.33

years of credible state retirement service instead of 10 years.

The District Court held that the State, by its statement of fact

as to the length of time which Kuge had to serve in order to

qualify for benefits, was estopped to deny Kuge state service

retirement benefits. See also Salz v. Department of

Administration, Division of Retirement , 432 So. 2d 1376 (Fla. 3d

DCA 1983).

24. Respondent, having made no misrepresentation of fact,

has not engaged in conduct which could provide the basis for

estoppel. Kuge , supra .

25. Moreover, even if Respondent had made a mistake of law,

which it did not in this case, the State may not be estopped for

conduct resulting from mistakes of law. Salz v. Department of

Administration, Division of Retirement , 432 So. 2d 1376 (Fla. 3d

DCA 1983).

26. Under the facts and law of this case, Petitioner should

be denied relief and Respondent's Motion for Summary Final Order

should be granted.

RECOMMENDATION

Based upon the findings of fact and conclusions of law, it

is

RECOMMENDED:

That the Division of Retirement issue a Final Order denying

Petitioner, Ronald Hodge, the relief sought herein, as Respondent

has no basis in law or equity to change Petitioner's type of

retirement.

DONE AND ENTERED this 28th day of April, 1999, in

Tallahassee, Leon County, Florida.

___________________________________

DIANE CLEAVINGER

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 3 2399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 28th day of April , 1999.

COPIES FURNISHED:

Emily Moore, Esquire

Division of Retirement

Cedars Executive Center

Building C

2639 North Monroe Street

Tallahassee, Florida 32399-1560

Anthony J. Salzman, Esquire

Moody and Salzman, P.A.

Post Office Drawer 2759

Gainesville, Florida 32602

A. J. McMullian, III, Director

Division of Retirement

Cedars Executive Center

Building C

2639 North Monroe Street

Tallahassee, Florida 32399-1560

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.