Opinion ID: 1985209
Heading Depth: 2
Heading Rank: 1

Heading: Suspension of Future Pension Payments

Text: Neither the facts of this case nor the applicable law barred the board from suspending the payment of future pension benefits to Romano after it discovered in 1996 that he had been serving as a full-time municipal employee while he was also receiving pension benefits from the state. [2] Therefore, we affirm that portion of the Superior Court's judgment in this case, squarely on the grounds that the doctrine of equitable estoppel should not be applied against a governmental entity like the board when, as here, the alleged representations or conduct relied upon were ultra vires or in conflict with applicable law. See State v. Rhode Island Alliance of Social Services Employees, Local 580, SEIU, 747 A.2d 465, 469 (R.I.2000) ( Rhode Island Alliance ); Rhode Island Brotherhood of Correctional Officers v. State Department of Corrections, 707 A.2d 1229, 1237-38 (R.I.1998); Technology Investors v. Town of Westerly, 689 A.2d 1060, 1062 (R.I.1997); Providence Teachers Union v. Providence School Board, 689 A.2d 388, 391-92 (R.I.1997) ( Providence Teachers II ); Providence Teachers Union v. Providence School Board, 689 A.2d 384, 388 (R.I.1996) ( Providence Teachers I ); Warwick Teachers' Union Local No. 915 v. Warwick School Committee, 624 A.2d 849, 851 (R.I. 1993); School Committee of Providence v. Board of Regents for Education, 429 A.2d 1297, 1302 (R.I.1981); Ferrelli v. Department of Employment Security, 106 R.I. 588, 593-94, 261 A.2d 906, 909-10 (R.I.1970). Here, at all times material to this case, applicable state law, § 36-10-36, required that [p]ension payments shall be suspended (emphasis added) whenever any state retiree is reemployed by a municipality within the state for more than seventy-five working days per calendar year. Such legislation, we have held, was both reasonable and necessary to advance the legitimate public purpose of fostering public confidence in the State's retirement system by restricting the proclivity of some public pensioners to indulge in what is colloquially referred to as `double dipping'  that is, the simultaneous receipt by retired public employees of both a salary for state reemployment and a state pension. Retired Adjunct Professors v. Almond, 690 A.2d 1342, 1347 (R.I.1997). After Romano's retirement from state employment in 1989, he was reemployed by a municipality where he worked for more than seventy-five working days per calendar year. Thus, his pension payments from the state should have been suspended during each of those years. Instead, he continued to collect through 1999 both a full pension from the state and a full salary from the town while apparently failing to report his full-time municipal-employment status to the retirement board on a monthly basis as the law required him to do. See § 36-10-36(b) ( Notice of employment shall be sent monthly to the retirement board by the employer and by the retired member .). (Emphases added.) [3] To cite just one recent example of a case where we have refused to estop a governmental entity when to do so would contravene state law, in Technology Investors, 689 A.2d at 1062, we held that a trial justice had erred in concluding that a municipality was estopped from claiming that its grant of a tax abatement was unenforceable. The town had granted the abatement to a business that had relocated to that town based upon the tax-abatement assurances of the town and its agents. Id. But we held that the abatement was unenforceable because it was contrary to state law and, therefore, the local government's representations and actions to the contrary were deemed ultra vires. Id. For this reason, the taxpayer was unable to estop the town from reneging on its tax-abatement promises merely because it had relied upon the town's actions and assurances to its financial detriment. Id. We ruled there that [t]he significant policy that undergirds this rule [no municipal tax abatements for relocating businesses] cannot be set aside by estoppel. Id. As we noted again last term, notions of promissory estoppel that are routinely applied in private contractual contexts are ill-suited to public-contract-rights analysis. D. Corso Excavating, Inc. v. Poulin, 747 A.2d 994, 1001 (R.I.2000) (quoting Retired Adjunct Professors, 690 A.2d at 1346). Indeed, in Retired Adjunct Professors, we observed that courts have consistently refused to give effect to government-fostered expectations that, had they arisen in the private sector, might well have formed the basis of a contract or an estoppel. 690 A.2d at 1346 (quoting Pineman v. Fallon, 662 F.Supp. 1311, 1316 (D.Conn.1987), aff'd, 842 F.2d 598 (2d Cir.), cert. denied, 488 U.S. 824, 109 S.Ct. 72, 102 L.Ed.2d 48 (1988)). Most recently, we landed with an audible thud on separate attempts by two Johnston nightclubs to parlay alleged verbal assurances from individual government officials  supposedly approving of or immunizing their illegal conduct  into an equitable estoppel defense against the government's attempts to enforce the applicable law against the offending parties. See Casa DiMario, Inc. v. Richardson, 763 A.2d 607, 612-13 (R.I. 2000); El Marocco Club, Inc. v. Richardson, 746 A.2d 1228, 1233-34 (R.I.2000). Here, too, neither the retirement counselor nor the board's executive director possessed any actual or apparent authority to vary or contradict a valid employment requirement prescribed by state law. Rhode Island Alliance, 747 A.2d at 468 (quoting Pawtucket School Committee v. Pawtucket Teachers' Alliance Local No. 930, 652 A.2d 970, 972 (R.I.1995)). Although in an appropriate factual context the doctrine of estoppel should be applied against public agencies to prevent injustice and fraud where the agency or officers thereof, acting within their authority, made representations to cause the party seeking to invoke the doctrine either to act or refrain from acting in a particular manner to his [, her, or its] detriment, Ferrelli, 106 R.I. at 594, 261 A.2d at 910 (emphasis added), neither a government entity nor any of its representatives has any implied or actual authority to modify, waive, or ignore applicable state law that conflicts with its actions or representations. See Technology Investors, 689 A.2d at 1062; cf. Rhode Island Alliance, 747 A.2d at 469 (statutory obligations cannot be bargained away via contrary provisions in a [collective bargaining agreement], nor can they be compromised by the past or present practices of the parties). As we have stated repeatedly, such an estoppel cannot be applicable when the acts in question are clearly ultra vires. Technology Investors, 689 A.2d at 1062. Thus, [t]his Court has squarely rejected the proposition that a municipality may be bound by the actions of an agent without actual authority. Providence Teachers II, 689 A.2d at 391. [4] Indeed, just last term, in Rhode Island Alliance, we stated that the renegade legal interpretations of a high-ranking state official can[not] override a state law that plainly provides otherwise. 747 A.2d at 470. As a result, we concluded, if a statute contains or provides for nondelegable and/or nonmodifiable duties, rights, and/or obligations, then neither contractual provisions nor purported past practices nor arbitration awards that would alter those mandates are enforceable. Id. at 469. We can fathom no reason for us to depart from this rationale in this case. Although we are not dealing here with a public union or its members but rather with a former state engineer who is now a management-level municipal-government employee, the same principle should be controlling. What is sauce for the union goose should be sauce for the managerial gander. In this case, the executive director and the retirement counselor who spoke with Romano before he retired possessed no more authority to waive the municipal-employment limits on Romano's receipt of state retirement benefits (as set forth in § 36-10-36) than the school board possessed in Providence Teachers II to enter into a collective bargaining agreement with the teacher's union without the ratification of the city council. See Providence Teachers II, 689 A.2d at 391. Therefore, to the extent they may have advised Romano that he could work for a municipality on a full-time basis without suffering any diminishment of his state pension, the agents of the retirement board, like the school board itself in the Providence Teachers cases, were acting ultra vires and lacked any authority to bind the state to provide retirement benefits to Romano beyond those allowed by state law. See Providence Teachers II, 689 A.2d at 391; Providence Teachers I, 689 A.2d at 386. Indeed, perhaps in recognition of her limited authority, the retirement counselor told Romano that if he had any questions whatsoever about post-retirement reemployment, he should go to the retirement board to stay out of trouble. See G.L.1956 § 42-35-8 (empowering agencies like the board to issue advisory opinions as to the applicability of any statutory provision or of any rule or order of the agency). Thus, contrary to the dissent's conclusion, Romano had every reason to believe that the retirement counselor was not speaking for the board when she supposedly told him he could work for the town without affecting his state pension; otherwise, why would she then tell him in the same breath that he should go to the retirement board to stay out of trouble? The dissent's further suggestion that it is far more likely that she meant that he should consult with the [board's] staff is most unpersuasive; after all, the retirement counselor herself was part of the board's staff. So why, we submit, would a board staffer tell Romano that he should go to the board itself to stay out of trouble  yet really mean that he should just consult with other board staff? Further, given § 42-35-8, we conclude that Romano possessed standing to request the board to provide him with an advisory opinion concerning whether he could accept a salary based upon his working at full-time municipal employment after retiring from state service, yet still receive his full state-pension benefits while doing so. Nonetheless, we have no indication that Romano ever submitted such a request or otherwise went to the board as the retirement counselor advised him to do. [5] In Ferrelli, this Court quoted with approval from the Maryland Supreme Court's decision in the case of City of Baltimore v. Chesapeake Marine Railway Co., 233 Md. 559, 197 A.2d 821, 831-32 ( 1964), citing it for the following proposition:  Estoppel against a municipal corporation growing out of affirmative action must be predicated upon the acts or conduct of its officers, agents or official bodies acting within the scope of their authority. 10 McQuillan, Mun. Corp. (3rd Ed.), Sec. 28.56   . (Emphasis added.) 106 R.I. at 592-93, 261 A.2d at 909. [6] Moreover, we do not abrogate the doctrine of equitable estoppel by following the Ferrelli rule that government officials must be duly authorized  acting within their authority and consistently with state statutes  before governmental entities can be subject to equitable estoppel based upon their representations or conduct. There have been and will continue to be many situations, such as those in Schiavulli v. School Committee of North Providence, 114 R.I. 443, 444-51, 334 A.2d 416, 417-20 (1975), and Greenwich Bay Yacht Basin Associates v. Brown, 537 A.2d 988, 989-93 (R.I.1988), in which the doctrine of estoppel can be applied against governmental entities without doing violence to any state statutory mandate or to the requirement that officials be duly authorized before their agencies will be estopped. In Schiavulli, a school committee was estopped to deny a tenured teacher's request for an unpaid leave of absence when the committee was found to have a duty to vote on the teacher's unpaid leave request instead of failing to act on it at all. Schiavulli, 114 R.I. at 449-51, 334 A.2d at 419-20. But there was no suggestion that granting the teacher's leave request would have been ultra vires or contrary to any state statute or other law prohibiting such leave. See id. On the contrary, it was plain that the school committee had this authority and, therefore, its inaction in the face of a duty to respond could be and properly was found to constitute an estoppel. See id. Likewise, in the Greenwich Bay case, the state agency in question was not acting ultra vires or contrary to state law when it represented to the applicant that it would evaluate its request for approval under the regulatory program that existed when the request was submitted. Greenwich Bay, 537 A.2d at 989-91. Thus, we overrule neither Schiavulli nor Greenwich Bay by adhering to the requirement espoused in Ferrelli and followed in Technology Investors that [e]stoppel against a [public entity]    must be predicated upon the acts or conduct of its officers, agents or official bodies acting within the scope of their authority. Ferrelli, 106 R.I. at 592-93, 261 A.2d at 909; see also Technology Investors, 689 A.2d at 1062; Greenwich Bay, 537 A.2d at 991-93; Loiselle v. City of East Providence, 116 R.I. 585, 591, 359 A.2d 345, 349 (1976) (holding that municipality was not estopped to enforce a residency requirement against a municipal official whose conduct in the matter at issue was also blameworthy); Schiavulli, 114 R.I. at 449, 334 A.2d at 419. [7] We also have long held that a person's failure to discover the true scope of a government agent's actual authority will not provide any grounds to relieve that person's detrimental reliance upon the agent's representations or actions. See Providence Teachers II, 689 A.2d at 392 (citing Vieira v. Jamestown Bridge Commission, 91 R.I. 350, 358, 163 A.2d 18, 23 (1960); Murphy v. Duffy, 46 R.I. 210, 215-16, 124 A. 103, 105 (1924)). Indeed, to rule otherwise would undermine the integrity and structure of our state government because it would allow every government official to act as his own mini-legislature, cashiering those laws he or she dislikes, is ignorant of, or misinterprets, and instead molding the law to be whatever the government official claims it to be. Thus, even in cases in which a government agent is acting with limited actual authority, as in Warwick Teachers' Union, we have held that persons dealing with that agent may not reasonably rely upon actions which exceed that agent's actual but limited authority. See Warwick Teachers' Union, 624 A.2d at 851. In Warwick Teachers' Union, a school committee appointed negotiators to enter into a new collective bargaining agreement with the teachers' union. Id. at 850. The negotiators agreed to certain terms that exceeded their authority, but we held that the agreement was not binding because the negotiators lacked actual authority to bind the municipality to these terms. Id. at 851. Accordingly, even if the executive director and retirement counselor in this case had possessed some actual authority to give advice on behalf of the retirement board, they had no authority whatsoever to exempt Romano from a clear statutory mandate, one that prohibited a retired state employee from receiving full state pension benefits while simultaneously working full-time for a municipality and collecting a full municipal salary. Any such representations would have exceeded any actual or apparent authority they may have possessed. Hence, as in Warwick Teachers' Union, Romano was not entitled to rely upon those representations to support a defense of equitable estoppel because the authority of a public agent to bind    must be actual. Id. at 851 (citing School Committee of Providence, 429 A.2d at 1302). In sum, following the teaching of Casa DiMario, El Marocco Club, Technology Investors, Ferrelli, Loiselle, Schiavulli, and the other cases cited in this opinion, we rule in this case that the doctrine of equitable estoppel did not preclude the state's retirement system from suspending the pension overpayments received by Romano while he was also working full-time for the municipality in violation of applicable state law. See Casa DiMario, Inc., 763 A.2d at 612-13; El Marocco Club, 746 A.2d at 1233-34; Technology Investors, 689 A.2d at 1062; Loiselle, 116 R.I. at 592-93, 359 A.2d at 349; Schiavulli, 114 R.I. at 449, 334 A.2d at 419; Ferrelli, 106 R.I. at 592, 261 A.2d at 909. Thus, in contrast to the dissent, we conclude that this is not an appropriate occasion to temper our long-followed actual-authority rule in cases involving the actions of government agents by applying an equitable, case-by-case evaluation of the circumstances. Such a relaxation of the rule would open the door  unnecessarily, we believe  to ad hoc and unpredictable adjudications in these types of cases.