Opinion ID: 1043075
Heading Depth: 4
Heading Rank: 1

Heading: Adjust the service or correct the records,

Text: allowance or benefits of any member, retired employee or beneficiary after an error or inequity has been determined, and require repayment of any money determined to have been paid by the System in error, if the money was paid within 6 years before demand for its repayment. NRS 286.190(3)(a) (emphasis added). NRS 286.190(4) defines error or inequity as the existence of extenuating circumstances, including, but not limited to, a member's reasonable and detrimental reliance on representations made by the System or by the public employer pursuant to NRS 286.288 which prove to be erroneous, or the mental incapacity of the member. Citing NRS 286.190(3), the district court held that the Board was required to grant Judge Smith equitable relief. But this reading ignores the statute's use of the permissive may. It is a well-settled principle of statutory construction that statutes using the word 'may' are generally directory and permissive in nature, while those that employ the term 'shall' are presumptively mandatory. Nev. Comm'n on Ethics v. JMA I Lucchesi, 110 Nev. 1, 9-10, 866 P.2d 297, 302 (1994). The district court's reading contravenes the presumption that every word, phrase, and provision—here, the word may—in a statute has meaning. Law Offices of Barry Levinson, P.C. v. Milko, 124 Nev. 355, 366-67, 184 P.3d 378, 38687 (2008); In re Prosole, 32 Nev. 378, 383, 108 P. 630, 632-33 (1910). A statute's express definition of a term controls the construction of that term no matter where the term appears in the statute, so NRS 286.190(4)'s definition of error or inequity controls. Williams v. Clark Cnty. Dist. Attorney, 118 Nev. 473, 485, 50 P.3d 536, 544 12 (2002); 1A Norman J. Singer, Statutes and Statutory Construction § 20:8 (6th ed. 2002). Under NRS 286.190(4), error or inequity signifies extenuating circumstances, such as detrimental reliance or mental incapacity of the member. Although its use of including, but not limited to makes NRS 286.190(4)'s list of extenuating circumstances nonexhaustive, it is significant that none of the examples involves employee fault or neglect. Judge Smith and our dissenting colleagues cite Nevada Public Employees Retirement Board v. Byrne, 96 Nev. 276, 607 P.2d 1351 (1980), arguing that our courts have the inherent power to seek and to do equity. This is a true statement but the circumstances in Byrne were much different from Judge Smith's. In Byrne, PERS incorrectly told an employee he would receive $725.35 a month upon retirement, but when the employee retired, he received a mere $86.78 a month. Id. at 278, 607 P.2d at 1352. Here, PERS gave Judge Smith accurate Estimated Calculations every time he requested information about his retirement options. Unlike Byrne, nothing suggests that the Board falsely or incorrectly recorded Judge Smith's information or gave him inaccurate information on which he detrimentally relied. In fact, as the Board noted, Judge Smith acknowledged that PERS staff made no misrepresentations. It appears that he chose to delay sending his retirement notice so as to ensure no gap in health insurance coverage as he changed jobs; this was his choice, not one PERS recommended. Judge Smith admitted that he did not read the materials PERS provided him. He failed to file his PERS retirement application before January 5, 2009, because he assumed that timing did not matter. Judge Smith relied on his own assumptions to his detriment. 13 The dissent would remand this matter back to the PERS Board with instructions to make specific findings of fact and conclusions of law under its equitable powers set forth in NRS 286.190(3). But the PERS Board has already done so. Thus, its written findings of fact, conclusions of law, and decision consider and reject application of Byrne because in Byrne, unlike this case, PERS made the error in calculation, on which the employee relied to his detriment. In this case, by contrast, the Board found that Judge Smith has not alleged any error in his records, or the calculation or amount of his benefit. He asks the Board [to] change the 'effective date of his retirement. This the Board declined to do, because it would violate[ ] the Internal Revenue Service's 'in service distribution' rule and could jeopardize the entire retirement fund ['is status as a qualified retirement plan. 6 NRS 286.190(3)(a) permits the Board to [a] djust the service or correct the records of a member or retired employee after an error or inequity has been determined. By definition, adjust means to bring something into a proper state, and correct is to make something true, accurate, or right. Concise Oxford English Dictionary 16, 321 (11th ed. 2008). But as the Board found, its records and calculation of Judge Smith's service were accurate. What Judge Smith sought was to have the Board rewrite its records to establish an earlier retirement date than the true record and application of NRS 286.541(2) would dictate. According to the Board, this placed the plan as a whole at risk, because it amounted to an improper in-service distribution. Such calculated risk avoidance— involving a subject within the expertise of the Board, not the courts—is something a court should not lightly second guess. See In re State Eng'r 6 JudgeSmith did not meaningfully contest the PERS Board's assessment of the IRS risk associated with in-service distributions. SUPREME COURT OF NEVADA 14 (0) 1947A Ruling 5823, 128 Nev. „ 277 P.3d 449, 453 (2012). Under these circumstances, we cannot conclude that the PERS Board abused its discretion when it determined that Judge Smith must wait until he retires from his current employment to collect his service benefit, none of which he has lost by reason of the Board's determination in this case. We therefore reverse. C.J. We concur: J. Hardesty Parraguirre J. Douglas SUPREME COURT OF NEVADA 15 (0) 1947A GIBBONS, J., with whom CHERRY and SAITTA, JJ., agree, concurring in part and dissenting in part: While I concur with the majority that NRS 286.541(2) determines the effective date of retirement, I disagree that the Board may not grant equitable relief pursuant to NRS 286.190(3) and (4). As a deputy public defender, as a deputy district attorney, and as an elected justice of the peace, Judge Smith was required to be enrolled as a member of PERS. In 2001, the Legislature created the Judicial Retirement System (JRS) for supreme court justices and district judges. In 2005, the Legislature adopted NRS 1A.285 to allow a justice of the peace or municipal judge to participate in JRS. The district court found that, after his election to the Eighth Judicial District Court in November 2008, Judge Smith advised PERS that he intended to retire from PERS prior to taking office as a district judge on January 5, 2009. Judge Smith would then become a member of the JRS on that date. PERS sent the necessary paperwork to Judge Smith to complete for his retirement. The district court found that Judge Smith retired as a justice of the peace on December 31, 2008, and Judge Smith ceased having contributions made to PERS on his behalf as of that date. As set forth in the majority, PERS received Judge Smith's retirement application on January 8, 2009, or three days after he commenced his service as an elected district judge. NRS 286.190 sets forth the general powers of the PERS Board. NRS 286.190(3)(a) provides in part that the Board may adjust the service or correct the records, allowance or benefits of any member, retired employee or beneficiary after an error or inequity has been determined. . . . NRS 286.190(4) defines error or inequity as the existence of extenuating circumstances, including, but not limited to, a member's reasonable and detrimental reliance on representations made by the System. Contrary to the majority's conclusion, this statute does not limit the Board's authority to grant equitable relief to PERS members who make inadvertent mistakes. After he retired on December 31, 2008, Judge Smith should have delivered his fully executed retirement application to PERS prior to January 5, 2009. The application required a notarized signature by Judge Smith's wife consenting to the terms of his retirement option. There was a delay in obtaining this notarization. In Nevada Public Employees Retirement Board v. Byrne, 96 Nev. 276, 607 P.2d 1351 (1980), we affirmed the judgment of the district court estopping the PERS Board from altering the amount and calculation of retirement benefits it had originally represented to Mr. Byrne and ordering the payment of those retirement benefits. The PERS Board argued in part that because it had the inherent power to correct mistakes, any reliance on its representations was barred. Id. at 279, 607 P.2d at 1353. We disagreed and concluded that our courts have the inherent power to seek and to do equity. Id. at 280, 607 P.2d at 1354. In the present case, the district court found and determined that PERS is equitably estopped from denying Judge Smith his PERS retirement benefits. The district court found and concluded that in response to reasonable inquires made by Judge Smith, PERS at no time informed [Judge Smith] of a deadline for submitting his application. Neither was this deadline explained in the application packet or the applicable statutes. The district court further found and concluded that Judge Smith enrolled in JRS only because of the unresolved status of this 2 litigation. Finally, the district court noted that the enrollment was made under protest and was hardly voluntary. Based on these findings and conclusions, the district court properly determined that the Board could not fairly deny benefits and thus should have turned to its own powers under NRS 286.190 to do equity. Therefore, I dissent from the majority's stringent interpretation of NRS 286.190(3) and (4). The PERS Board does have the power to remedy an error or inequity based upon a mistake of the PERS retirement applicant. Otherwise, a minor error may reduce significant retirement benefits which the applicant has earned over many years of service. The PERS Board has the equitable power to rescind the enrollment by Judge Smith in the JRS. Since we do not make factual findings, I would reverse the judgment of the district court with instructions to remand this case to the PERS Board to make specific findings of fact and conclusions of law under its equitable powers set forth in NRS 286.190(3) and (4) regarding the extenuating circumstances in this case. J. Gibbons 3