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IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
 

January 2014 Term 

_______________ FILED 

June 11, 2014 

released at 3:00 p.m. No. 13-0937 RORY L. PERRY II, CLERK 

SUPREME COURT OF APPEALS 

_______________ OF WEST VIRGINIA 

WEST VIRGINIA CONSOLIDATED PUBLIC
 

RETIREMENT BOARD,
 

Respondent Below, Petitioner
 

v. 

BENNY JONES,
 

Petitioner Below, Respondent
 

Appeal from the Circuit Court of Raleigh County
 

The Honorable John L. Cummings, Judge
 

Civil Action No. 11-AA-8-B
 

REVERSED AND REMANDED
 

Submitted: May 6, 2014
 

Filed: June 11, 2014
 

J. Jeaneen Legato, Esq. E. Kent Hellems, Esq. 

West Virginia Consolidated Public Hinton, West Virginia 

Retirement Board Attorney for the Respondent 

Charleston, West Virginia 

Attorney for the Petitioner 

The Opinion of the Court was delivered PER CURIAM. 

JUSTICE KETCHUM dissents, and reserves the right to file a dissenting opinion. 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SYLLABUS BY THE COURT
 

1. “In cases where the circuit court has amended the result before the 

administrative agency, this Court reviews the final order of the circuit court and the 

ultimate disposition by it of an administrative law case under an abuse of discretion 

standard and reviews questions of law de novo.” Syl. pt. 2, Muscatell v. Cline, 196 W. 

Va. 588, 474 S.E.2d 518 (1996). 

2. “Interpreting a statute or an administrative rule or regulation presents 

a purely legal question subject to de novo review.” Syl. pt. 1, Appalachian Power Co. v. 

Tax Dep’t., 195 W. Va. 573, 466 S.E.2d 424 (1995). 

3. “The general rule governing the doctrine of equitable estoppel is that 

in order to constitute equitable estoppel or estoppel in pais there must exist a false 

representation or a concealment of material facts; it must have been made with 

knowledge, actual or constructive of the facts; the party to whom it was made must have 

been without knowledge or the means of knowledge of the real facts; it must have been 

made with the intention that it should be acted on; and the party to whom it was made 

must have relied on or acted on it to his prejudice.” Syl. pt. 6, Stuart v. Realty Corp., 141 

W. Va. 627, 92 S.E.2d 891 (1956). 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Curiam: 

Petitioner West Virginia Consolidated Public Retirement Board (“the 

Retirement Board” or “the Board”) appeals the July 22, 2013, order of the Circuit Court 

of Raleigh County that reversed the Board’s final order and found that the Board is 

equitably estopped from denying to Respondent Benny Jones participation in the Public 

Employees Retirement System (“PERS”). For the reasons stated below, we find that the 

circuit court erred in estopping the Board from denying participation in PERS to Mr. 

Jones, and we reverse and remand. 

I. FACTS 

The Raleigh County Emergency Services Authority (“the Authority”) 

sought the services of a full-time attorney to handle the Authority’s legal matters. The 

position was salaried and provided full benefits except for holiday and leave accrual. The 

base pay was $613.46 per two weeks for up to eight hours of service per month. For each 

additional hour billed over eight, the attorney would receive $125.00 which was later 

increased to $150.00. The attorney who filled this position was expected to be on call for 

the Authority twenty-four hours a day, seven days a week. 

Respondent Benny Jones accepted this position and began employment 

with the Authority on January 1, 2002. Mr. Jones’ work for the Authority comprised ten 

to fifteen percent of his law practice. He performed work for the Authority at the reduced 

hourly rate of $125.00 due, in part, to the Authority’s representation that he would 

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receive retirement benefits. Mr. Jones billed work that he performed for clients other than 

the Authority at $250.00 an hour. 

Following Mr. Jones’ acceptance of employment with the Authority, he 

received a letter from the Retirement Board dated June 26, 2003, in which the Board 

informed him that because he had returned to the employment of an employer who 

participates in PERS, he was eligible to reinstate the refund of his previous contributions 

to the Board that he withdrew on or about May 17, 1984. The Board indicated that 

repaying that amount would allow the Board to reinstate Mr. Jones’ former contributing 

service totaling one year and eight months. On or about July 8, 2003, Mr. Jones remitted 

the full repayment amount to reinstate his prior contributing service, and the Board 

acknowledged receipt of this repayment and reinstatement of Mr. Jones’ prior 

contributing service by letter dated July 10, 2003. 

Mr. Jones provided additional work for the Authority over the eight-hour 

monthly base for each year worked as follows: 2002 – 29.5 additional hours; 2003 – 22 

additional hours; 2004 – 99.75 additional hours; 2005 – 104.5 additional hours; 2006 – 

57.5 additional hours; 2007 – 104.25 additional hours; 2008 – 13.25 additional hours; 

2009 – 58.75 additional hours; 2010 – 74.25 additional hours. The additional hours 

reported did not include the fact that Mr. Jones was on-call twenty-four hours a day, 

seven days a week. 

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On or about November 1, 2010, the Board notified Mr. Jones that he was 

ineligible to participate in PERS. The Board concluded that Mr. Jones had not worked the 

statutorily-required 1,040 hours a year necessary for participation in PERS as set forth in 

W. Va. Code § 5-10-2(11) and W. Va. C.S.R. § 162-5-2.3. 

Mr. Jones appealed the Board’s decision. In the hearing examiner’s 

subsequent recommended decision, it determined that Mr. Jones is not eligible to be a 

member of PERS because his position with the Authority does not constitute “full time 

employment” pursuant to W. Va. C.S.R. § 162-5-2.3, which describes full time 

employment as “normally require[ing] twelve (12) months per year service and 

require[ing] at least one thousand forty (1,040) hours per year service in that position.” 

The Retirement Board adopted the hearing examiner’s recommended decision by final 

order dated July 6, 2011, and denied participation in PERS to Mr. Jones. 

Mr. Jones then appealed to the Circuit Court of Raleigh County on the basis 

that the hearing examiner and the Retirement Board failed to consider the doctrine of 

equitable estoppel and this Court’s decision in Hudkins v. Public Retirement Board, 220 

W. Va. 275, 647 S.E.2d 711 (2007). In its July 22, 2013, order, the circuit court reversed 

the Board and held that the Board is equitably estopped from denying to Mr. Jones 

participation in PERS. The Board now appeals the circuit court’s order. 

II. STANDARD OF REVIEW 

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The following standard of review applies generally to a case like the instant 

one which involves a circuit court’s reversal of an administrative decision: 

In cases where the circuit court has amended the result 

before the administrative agency, this Court reviews the final 

order of the circuit court and the ultimate disposition by it of 

an administrative law case under an abuse of discretion 

standard and reviews questions of law de novo. 

Syl. pt. 2, Muscatell v. Cline, 196 W. Va. 588, 474 S.E.2d 518 (1996). The circuit court 

based its decision below on its finding that equitable estoppel applies against the 

Retirement Board to estop the Board from finding that Mr. Jones is ineligible to 

participate in PERS. The application of equitable estoppel is a question of law which we 

review de novo. Also, the circuit court’s finding of equitable estoppel is based in part on 

its construction of a statute and an administrative rule. This Court has held that 

“[i]nterpreting a statute or an administrative rule or regulation presents a purely legal 

question subject to de novo review.” Syl. pt. 1, Appalachian Power Co. v. Tax Dep’t., 

195 W. Va. 573, 466 S.E.2d 424 (1995). Having set forth the applicable standard of 

review, we will now address the issue in this case. 

III. DISCUSSION 

The sole issue before us is whether the circuit erred in applying equitable 

estoppel to estop the Retirement Board from denying to Mr. Jones participation in PERS. 

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In finding that application of equitable estoppel applies in this case, the 

circuit court relied on this Court’s per curiam decision in Hudkins v. Public Retirement 

Bd., 220 W. Va. 275, 647 S.E.2d 711 (2007). In Hudkins, the petitioner, Ms. Hudkins, 

was a member of PERS as a result of her employment with the State Department of 

Health and Human Resources (“DHHR” or “the Department”). At the time of her 

separation from employment, Ms. Hudkins was not yet fifty-five years of age and 

therefore was not eligible for immediate retirement benefits under PERS. Prior to 

separating from her employment, Ms. Hudkins contacted the Retirement Board to 

confirm her right to convert her accumulated sick leave to service credit. An employee of 

the Board assured Ms. Hudkins that she could freeze her sick leave and use it as 

additional service credit when she filed for retirement benefits. In addition to the 

assurance given to Ms. Hudkins by the Board employee, she also was given written 

assurance by an employee at the DHHR that she could convert her accumulated sick 

leave to additional service credit. 

More than two years following her separation from employment, the Board 

informed Ms. Hudkins that she could not convert her accumulated sick leave to service 

credit. As a result, Ms. Hudkins initiated administrative proceedings. After a hearing on 

the matter, the hearing examiner recommended that Ms. Hudkins’ appeal be denied. The 

Board adopted the recommended decision and denied her appeal. The circuit court, on 

appeal of the Board’s decision, found that the elements of equitable estoppel were met by 

Ms. Hudkins. The Board then appealed the circuit court’s decision to this Court. 

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In Hudkins, this Court affirmed the circuit court’s ruling after applying the 

elements of equitable estoppel in syllabus point 6 of Stuart v. Realty Corp., 141 W. Va. 

627, 92 S.E.2d 891 (1956), which says: 

The general rule governing the doctrine of equitable 

estoppel is that in order to constitute equitable estoppel or 

estoppel in pais there must exist a false representation or a 

concealment of material facts; it must have been made with 

knowledge, actual or constructive of the facts; the party to 

whom it was made must have been without knowledge or the 

means of knowledge of the real facts; it must have been made 

with the intention that it should be acted on; and the party to 

whom it was made must have relied on or acted on it to his 

prejudice. 

This Court reasoned in Hudkins as follows: 

After a complete review of the record in this case, we 

are compelled to conclude that the elements of equitable 

estoppel have been met by Ms. Hudkins. It is not disputed 

that a Board employee made the representation that Ms. 

Hudkins was eligible to claim service credit for her unused 

sick leave given her years of service and age. Furthermore, as 

disclosed in oral argument, the Board has had a long history 

of extending service credit for unused sick leave without 

regard to whether or not the employee was separating from 

employment to immediately draw retirement benefits. The 

Board employee who advised Ms. Hudkins clearly had in her 

possession all of the facts necessary to correctly advise Ms. 

Hudkins as to her entitlement to convert her unused sick 

leave. We are also satisfied that the representations by the 

Board employee were made with the intention that Ms. 

Hudkins would act upon those representations and that Ms. 

Hudkins did, in fact, act in reliance upon the representations, 

of the Board employee. 

Furthermore, it is also uncontroverted that Ms. 

Hudkins would not have separated from her employment with 

the Department but for the representations made by the Board 

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employee and the representations made by Mr. Najmulski, the 

community service manager for the Department in which Ms. 

Hudkins was employed, that Ms. Hudkins could convert her 

unused sick leave to extended service credit for purposes of 

calculating her retirement benefits. That Ms. Hudkins relied 

upon these representations to her prejudice is clearly 

expressed in her September 13, 2002 letter to the Board when 

she stated, “Since I have already resigned approximately 2 1⁄2 

years ago, I do not have the option of thinking it over.” Her 

reliance upon those representations is uncontroverted. 

We also note that the Board employee upon whom Ms. 

Hudkins relied before her separation from employment was 

simply doing that which had apparently become a common 

practice of the Board, namely, allowing employees who 

separate from their employment to “freeze” their unused sick 

leave. Furthermore, we note that since the Board had not even 

addressed in their rules the matter of the unused sick leave 

credits until 2002 – more than two years following Ms. 

Hudkins’ separation from her employment, Ms. Hudkins 

could not have been aware of the methodology used by the 

Board even if she had thoroughly examined the Board’s rules. 

Finally, we observe that the Board’s staff was dedicated to the 

business of advising employees concerning retirement 

benefits. This is an activity that the Board undertakes 

everyday. We believe that Ms. Hudkins had every right to 

rely upon the advice of the Board representative regarding her 

right to “freeze” her unused sick leave for purposes of 

calculating her retirement benefits. This is especially true 

since the Board had apparently established the practice of 

giving the same advice to other employees both before and 

after Ms. Hudkins separated from her employment. 

Id., at 281, 647 S.E.2d at 717. 

The circuit court in the present case, in its application of Hudkins, 

recognized a difference between the facts in Hudkins and the facts herein. Specifically, 

the court noted that the false representation in Hudkins was made by the Retirement 

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Board whereas the false representation in this case was made by the Authority, Mr. 

Jones’ employer. However, the circuit court found that this difference is not of legal 

significance. According to the circuit court, W. Va. C.S.R. § 162-7-7.2 and W. Va. Code 

§ 5-10-2(12), prevent the Board from denying to Mr. Jones the right to participate in 

PERS where Mr. Jones’ employer erroneously informed him that he was eligible to 

participate in PERS. 

According to W. Va. C.S.R. § 162-7-7.2 (April 13, 2012), 

[i]n the event the Board determines that an employer 

error has occurred, the member is entitled to receive 

retirement system service credit for the prior period of 

employment in which the employer error occurred, with 

receipt of service credit being contingent upon the Board’s 

receipt of the employee and employer contributions, plus 

interest at the rate specified in subdivision 7.2.a. of this rule. 

West Virginia Code § 5-10-2(12) (2012), defines “employer error” as 

an omission, misrepresentation, or violation of relevant 

provisions of the West Virginia Code or of the West Virginia 

Code of State Regulations or the relevant provisions of both 

the West Virginia Code and of the West Virginia Code of 

State Regulations by the participating public employer that 

has resulted in an underpayment or overpayment of 

contributions required. A deliberate act contrary to the 

provisions of this section by a participating public employer 

does not constitute employer error. 

In relying on these provisions, the circuit court reasoned that the Authority’s false 

representation to Mr. Jones regarding his entitlement to participate in PERS constitutes 

an employer error under W. Va. Code § 5-10-2(12), and this error resulted in an 

overpayment of contributions by Mr. Jones and the Authority. The court then found that 

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pursuant to W. Va. C.S.R. 162-7-7.2. Mr. Jones is entitled to receive retirement system 

service credit for the prior period of employment in which Mr. Jones’ employer 

erroneously informed him that he was eligible to participate in PERS. Finally, the circuit 

court applied this Court’s holding in Hudkins in combination with its construction of W. 

Va. C.S.R. § 162-7-7.2 and W. Va. Code § 5-10-2(12), and concluded that the Retirement 

Board is estopped from denying to Mr. Jones participation in PERS. 

On appeal, the Retirement Board asserts that the circuit court’s reliance on 

W. Va. C.S.R. § 162-7-7.2 and W. Va. Code § 5-10-2(12) constitutes error. According to 

the Board, this administrative rule and statute cannot be used to hold the Board 

vicariously liable for an employer’s false representation regarding PERS eligibility. The 

Board notes the definition of “employer error” in W. Va. Code § 5-10-2(12) specifically 

refers to an error by the employer “that has resulted in an underpayment or overpayment 

of contributions required,” (emphasis added) and the Board opines that no contributions 

were required in the instant case because Mr. Jones was not eligible to participate in 

PERS. In addition, the Board opines that W. Va. C.S.R. § 162-7-7.2 is not relevant to the 

facts of this case because this rule expressly pertains to interest rates applied to specified 

PERS member transactions. The Board concludes that the purpose of the statute and 

legislative rule is to provide a way to correct employer errors which result in 

overpayment or underpayment of contributions on behalf of PERS members. 

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This Court agrees with the Board that W. Va. C.S.R. § 162-7-7.2 and W. 

Va. Code § 5-10-2(12) do not apply to the facts of this case and cannot be used as a basis 

for estopping the Board from denying PERS eligibility to Mr. Jones. As noted by the 

Board, W. Va. Code § 5-10-2(12) unambiguously defines an employer error as an error 

“that has resulted in an underpayment or overpayment of contributions required.” This 

code section applies to a PERS member who has underpaid or overpaid contributions as 

the result of an employer error. It does not apply in instances where a public employer 

erroneously informs an employee that he or she is eligible to participate in PERS. 

In addition, we likewise find that W. Va. C.S.R. § 162-7-7.2 does not apply 

to the facts of this case. According to W. Va. C.S.R. § 162-7-1.1, which states the scope 

of Title 162, Series 7, “[t]his Rule addresses and identifies the interest rates which the 

Consolidated Public Retirement Board shall apply to the referenced member transactions 

which, from time-to-time, occur in the Board’s administration of the State’s several 

retirement systems.” A reading of the subject rule indicates that it specifically addresses 

the interest rates that apply to refunds, reinstatements, retroactive service, loan interest 

and payments, and employer error affecting PERS members. There simply is nothing in 

the Rule that indicates that the Retirement Board is bound by an employer error regarding 

an employee’s eligibility to be a member of PERS. 

Moreover, we note that the rule applying to requirements for membership 

in PERS is Title 162, Series 5. Specifically, W. Va. C.S.R. § 162-5-2.3 provides that 

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“[e]mployment of an employee by a participating public employer in a position which 

normally requires twelve (12) months per year service and requires at least one thousand 

forty (1,040) hours per year service in that position.” There simply is no valid reason to 

apply W. Va. C.S.R. § 162-7-7.2, regarding interest rates applicable to various PERS 

member transactions, to the requirements for PERS eligibility found in Title 162, Series 5 

or to conclude that an employer error can modify or amend the statutory requirements for 

PERS eligibility. Therefore, we find that the circuit court’s reliance on W. Va. Code § 5­

10-12(2) and Rule § 162-7-7.2 to conclude that the Board is estopped from finding Mr. 

Jones ineligible to be a members of PERS constitutes error. 

Having found that C.S.R. § 162-7-7.2 and W. Va. Code § 5-10-2(12) do not 

apply to the facts of this case to estop the Board from denying participation in PERS to 

Mr. Jones, we further determine that our holding in Hudkins does not apply to the present 

facts. As noted above, Hudkins is distinguished from the instant case in that Hudkins 

involved a false representation made by the Retirement Board whereas the instant case 

involves a false representation made by an employer. This Court’s holding in Hudkins is 

limited to instances where the Retirement Board itself makes a false representation 

regarding a public employee’s eligibility to receive retirement benefits. We deem it 

neither legally sound nor prudent to expand our holding in Hudkins to apply in 

circumstances regarding a public employer’s false representation to an employee that he 

or she is eligible to participate in PERS. 

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Mr. Jones presents several arguments in support of the circuit court’s 

decision all of which we find unavailing. First, Mr. Jones asserts that in Hudkins the 

employee relied upon the false representation of both her employee and the Board. While 

it is true that Ms. Hudkins’ employer, the DHHR, falsely represented to Ms. Hudkins that 

she could receive her accumulated sick leave pay upon retirement, it was Ms. Hudkins’ 

reliance on the misrepresentation of the Retirement Board which was the decisive factor 

in this Court’s determination to apply equitable estoppel in that case. 

Second, Mr. Jones points to the representations made by the Retirement 

Board in a letter, sent to him shortly after his employment with the Authority, informing 

him that since he had returned to the employment of a participating public employer, he 

was eligible to reinstate with appropriate interest the refund of his previously withdrawn 

contributions. Mr. Jones also calls this Court’s attention to the fact that by the time the 

Board determined that he was ineligible to be a member of PERS, he had made 

contributions to the Board for ten years and five months of service, meaning that his 

retirement benefits had become fully vested. While this Court finds the Board’s 

dilatoriness in discovering Mr. Jones’ ineligibility for PERS membership to be 

inexcusable, it is clear that Mr. Jones did not rely on the Board’s representations or 

conduct in deciding to accept the position with the Authority as he had already accepted 

the position by the time he received the Board’s letter. As a result, Mr. Jones cannot 

show that the Board should be equitably estopped from denying him eligibility to 

participate in PERS. 

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IV. CONCLUSION 

For the reasons set forth above, this Court reverses the July 22, 2013, order 

of the Circuit Court of Raleigh County, and we remand to the circuit court for 

reinstatement of the West Virginia Consolidated Public Retirement Board’s July 6, 2011, 

final order denying the appeal of Mr. Jones to participate in the Public Employees 

Retirement System based on his employment with the Raleigh County Emergency 

Services Authority. 

Reversed and remanded. 

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