Opinion ID: 2111011
Heading Depth: 2
Heading Rank: 2

Heading: Appellee Myers's Cross-Assignment of Error

Text: In his cross-assignment of error, Mr. Myers appeals the Board's decision to rescind, and its subsequent refusal to reinstate, two months of service credit for work Mr. Myers performed during the summer of 1972. As previously noted, an employee's final average salary is determined, in part, on the employee's total credited service. W. Va.Code § 5-10-22(a). As a college student at West Virginia University, Mr. Myers was recruited to work for the DOH through a cooperative education program. In this program, an undergraduate student who maintained a certain academic performance in a civil engineering program was eligible to work for the DOH during the summer. This summer employment was considered part-time and, thus, no retirement system contributions were made on the student's behalf, nor did the student accrue any service credit during those summers. Upon completion of the program, the student could apply to work full-time for the DOH. Mr. Myers participated in this program as a student engineer during the summers of 1972, 1973, 1974, and 1975. During the summer of 1972, the DOH mistakenly classified Mr. Myers as a full time employee and, therefore, deducted retirement system contributions from his paychecks. Specifically, from June 5, 1972, until August 21, 1972, the DOH withheld 4.5% of Mr. Myers's gross income as a contribution to PERS, which totaled $39.72. The DOH further recorded two months of service credit for Mr. Myers's work that summer. This mistake was not repeated in the following summers. Following his college graduation, the DOH hired Mr. Myers as a full-time employee. After Mr. Myers became a full-time employee, the DOH continued to record two months of service credit for his work during the summer of 1972. In 1999, Mr. Myers contacted the Board to request an additional one month of service credit for his work during that summer. In addition, pursuant to West Virginia Code § 5-10-14(f), Mr. Myers sought to retroactively purchase service credit for his work during the summers of 1973, 1974, and 1975. The Board staff denied both requests, and Mr. Myers appealed to a Board hearing officer. The hearing officer, in a recommendation issued on March 31, 2000, likewise denied Mr. Myers's request to purchase additional service credit for those summers, finding that his employment at that time was neither full-time nor permanent, as required by West Virginia Code § 5-10-2(11) and West Virginia Code of State Regulations § 162-5-7. He recommended, however, that Mr. Myers be permitted to retain the two months of service credit previously allotted for the summer of 1972, stating that [a]lthough it is clear that Mr. Myers' participation in the system in 1972 was in error, equity suggests that he be permitted to retain this two-months service credit. The hearing officer's actual recommendation to the Board, however, simply stated: [i]t is recommended that the request of Rodney A. Myers for additional service credit for 1972 and to acquire service credit for employment in 1973, 1974 and 1975 be denied. On May 10, 2000, the PERS Board of Trustees considered the hearing officer's recommendation. At that hearing, the hearing officer informed the Board of Trustees of his recommendation, indicating that, as a sub-recommendation, he believed that Mr. Myers should be permitted to retain the two months of service credit for 1972. During the meeting, the Board of Trustees questioned the hearing officer about the appropriateness of the sub-recommendation, given his finding that Mr. Myers was not eligible to receive service credit for his work during those summer months. In response, the hearing officer explained his equity analysis, but concluded by noting that his formal Recommended Decision, on which the Board would vote, did not actually include any recommendation regarding the two months already credited for the summer of 1972. The Board of Trustees then issued a final order adopting the hearing officer's Recommended Decision. That order was never appealed. In 2007, while reviewing Mr. Myers's application for retirement benefits, the Board staff reconsidered the two months of service credit awarded for the summer of 1972. In February 2008, at the Board's direction, the DOH refunded Mr. Myers's original PERS contribution of $39.72, without interest. [5] The Board then removed the two months of service credit from Mr. Myers's total service credit calculation. Mr. Myers requested that the Board reinstate that credit, arguing that the Board had allowed him to retain this credit in its May 10, 2000, ruling. The Board, however, refused in a decision dated September 3, 2008. Mr. Myers appealed this issue to the Board's hearing officer, who considered the question in conjunction with Mr. Myers's appeal relating to the calculation of his final average salary. During the evidentiary hearing, the Board stipulated that it had, in fact, included two months of service credit for the summer of 1972 in every retirement statement it issued to Mr. Myers throughout his career. Nevertheless, the hearing officer recommended against reinstating the two months of service credit, finding that such credit was originally awarded in error, and that the original recommendation to the Board of Trustees in Mr. Myers's 2000 appeal did not actually include a recommendation as to the two months of service credit from the summer of 1972. This recommended decision was adopted by the Board of Trustees, and Mr. Myers appealed the decision to the circuit court, which affirmed the Board's decision. Now, in a cross-assignment of error, Mr. Myers contends that the doctrine of res judicata should prevent the Board from changing its position on the two months of service credit. While he does not dispute that the DOH erred in originally awarding service credit for those two months, he contends that the Board had previously taken the position that he be allowed to retain that credit on the basis of equity. Specifically, he contends that, in March 2000, the hearing officer recommended that he be allowed to retain credit for those two months, and that the Board of Trustees adopted that recommendation on May 10, 2000. Thus, he argues that the circuit court erred in affirming the Board's 2008 decision to rescind the credit for those two months because the doctrine of res judicata should have precluded the Board from reconsidering that issue. The purpose of res judicata, also referred to as `claim preclusion,' is to `preclude the expense and vexation attending relitigation of causes of action which have been fully and fairly decided.' Antolini v. W. Va. Div. of Natural Res., 220 W.Va. 255, 258, 647 S.E.2d 535, 538 (2007) ( quoting Sattler v. Bailey, 184 W.Va. 212, 217, 400 S.E.2d 220, 225 (1990)). Before the prosecution of a lawsuit may be barred on the basis of res judicata, three elements must be satisfied. First, there must have been a final adjudication on the merits in the prior action by a court having jurisdiction of the proceedings. Second, the two actions must involve either the same parties or persons in privity with those same parties. Third, the cause of action identified for resolution in the subsequent proceeding either must be identical to the cause of action determined in the prior action or must be such that it could have been resolved, had it been presented, in the prior action. Syl. Pt. 4, Blake v. Charleston Area Med. Ctr., Inc., 201 W.Va. 469, 498 S.E.2d 41 (1997). If, as in this case, the original adjudication arose in the context of an administrative proceeding, certain additional considerations are necessary: For issue or claim preclusion to attach to quasi-judicial determinations of administrative agencies, at least where there is no statutory authority directing otherwise, the prior decision must be rendered pursuant to the agency's adjudicatory authority and the procedures employed by the agency must be substantially similar to those used in a court. In addition, the identicality of the issues litigated is a key component to application of administrative res judicata or collateral estoppel. Syl. Pt. 2, Vest v. Bd. of Educ., 193 W.Va. 222, 455 S.E.2d 781 (1995) (emphasis added). The circuit court below concluded that the Board did not err or abuse its discretion in withdrawing, and then refusing to reinstate, the service credit for Mr. Myers's two months of work during the summer of 1972. The circuit court found that substantial evidence supported the Board's conclusion that Mr. Myers's work during that summer was provisional and temporary and, thus, did not constitute full time employment, as required to be credited service. See W. Va. C.S.R. § 162-5-2.3. The circuit court further dismissed Mr. Myers's res judicata argument, finding that the required elements for applying the doctrine of res judicata to an administrative adjudication are absent in this case. Upon review, [6] this Court finds no error in the circuit court's reasoning. As previously explained, the Board of Trustees did not actually adopt the hearing officer's sub-recommendation that Mr. Myers be permitted to retain service credit for his work during the summer of 1972 on the basis of equity. Although the hearing officer made such sub-recommendation, it is clear from the transcript of the Board of Trustees' meeting in May 2000 that the only language it adopted simply recommended that the request of Rodney A. Myers for additional service credit for 1972 and to acquire service credit for employment in 1973, 1974 and 1975 be denied. The Board of Trustees, therefore, never issued an adjudicatory decision regarding the two months of service credit. Consequently, there is no final decision on that issue from May 2000 to which the doctrine of res judicata could be applied. Moreover, when the Board of Trustees issued its May 2000 decision, it did not have any adjudicatory authority to determine whether Mr. Myers should have been permitted to retain the two months of service credit because that request had not properly been considered by the Board's staff first. Pursuant to the West Virginia Code of State Regulations § 162-2-7.1, appeals other than those for disability retirement benefits must first be considered by the Board's staff. If the Board's staff denies a request, it must notify the applicant in writing of their decision, stating the reasons for the denial. Id. The applicant may then appeal the Board staff's written denial to the hearing officer and Board of Trustees. Id. at § 162-2-7.2. In this case, Mr. Myers had requested permission from the Board's staff to purchase service credit for the summers of 1973, 1974, and 1975, as well as an additional month of credit for the summer of 1972. At that time, Mr. Myers was still being credited for two months of service during the summer of 1972 and, thus, he did not raise these two months as an issue. After considering Mr. Myers's request to purchase additional credit, the Board's staff issued a written denial without any mention of the two months of credited service that had been erroneously granted for the summer of 1972. Mr. Myers appealed that decision to the hearing officer. In the course of affirming the Board staff's denial of Mr. Myers's request to purchase additional service credit, the hearing officer noted that the original two months had been erroneously awarded, but made a sub-recommendation that the Board continue to credit those two months on the basis of equity. That issue, however, was never properly before the hearing officer because it had never been considered by the Board's staff. See W. Va.C.S.R. § 162-2-7.2. Thus, the Board of Trustees likewise had no authority to address the issue in its May 2002 order adopting the hearing officer's Recommended Decision. Accordingly, as the circuit court found, res judicata is inapplicable in this case because no prior decision was rendered on this particular issue pursuant to the Board of Trustee's adjudicatory authority. See Vest, 193 W.Va. 222, 455 S.E.2d 781, Syl. Pt. 2. The Court, therefore, affirms the Board's refusal to reinstate the two months of service credit erroneously awarded to Mr. Myers for his work during the summer of 1972. [7]