Opinion ID: 2595567
Heading Depth: 2
Heading Rank: 1

Heading: The ERS Board's Relevant FOFs

Text: For present purposes, I refer to the following FOFs entered by the ERS Board, which are undisputed except where otherwise noted: 1. . . . Helen . . . is the surviving spouse of Katsumi . . . , a deceased retired member of the [ERS]. 2. Katsumi . . . was a Class C non-contributory member employed by the Department of Education [(DOE)] at K;ipapa Elementary School as a Custodian II from September 21, 1970 to April 1, 1994. 3. On November 21, 1993, Katsumi . . . completed an ERS form entitled Request for Retirement Estimates. In that form, Katsumi . . . noted a definite retirement date of June 1994. At the bottom of the form, Katsumi . . . wrote the following questions: 1. REQUEST FOR RETIREMENT APPLICATION FORM, FOR I MAY APPLY FOR RETIREMENT EARLIER THAN JUNE/94[.] 2. SHOULD I RETIRE IN DEC. 31, 1993, EXPECT TO HAVE LUMP SUM PAYMENT FOR VACATION LEAVE. DO I RECEIVE PAYMENT IN 1994 OR IS IT ACCOUNTABLE FOR 1993. THIS IS FOR TAX/REASON. It is undisputed that Katsumi . . . signed the bottom of this form. . . . 4. On December 10, 1993, ERS responded to Katsumi['s] . . . Request for Retirement Estimates and sent him estimates of his monthly benefits based upon a retirement date of July 1, 1994. Those monthly benefits differed depending upon which method of retirement Katsumi . . . would elect ( i.e., Normal Option, Option A (50% Joint and Survivor), Option B (100% Joint and Survivor), or Ten-Year Guarantee). In this way, since there were four (4) methods of retirement, there were four (4) monthly benefit amounts designated. In comparison to the other three (3) methods of retirement, the monthly benefit amount under the Normal Option was the highest figure at approximately $240.00. . . . 5. Along with the retirement estimates sent to Katsumi . . . , as is the usual practice of the ERS according to the affidavit of Karl Kaneshiro, the Enrollment, Claims, and Benefits Manager for ERS . . . , Katsumi . . . was also provided with an informational pamphlet entitled Service Retirement Facts. This pamphlet explains in lay terms the various retirement plans and sets out the advantages and disadvantages of each of the plans. The retirement plans explained are: 1) Normal Retirement; 2) Option A (50% joint and survivor); 3) Option B (100% joint and survivor); and 4) Ten-Year Guarantee. For the normal retirement, the pamphlet states: The retirant receives a retirement allowance payable for life and in the event of death, there will be no further allowance payable. Advantages: Provides a maximum life time benefit for the retirant. Disadvantages: No lifetime survivor benefit for beneficiary(ies). The explanations for the remaining options make clear that a surviving beneficiary would receive a pension upon the retirant's death. . . . 6. On December 31, 1993, after receiving retirement estimates from ERS, Katsumi . . . completed his Application for Service Retirement requesting that his retirement allowance become effective April 1, 1994, thereby changing and advancing his previously noted retirement date of June 1994. On this same form, Katsumi . . . also selected a mode of retirement. Under the statement, I have read the information on the reverse side of this application and select the following mode of retirement, Katsumi . . . checked the area marked Normal as opposed to the remaining three (3) areas marked Option A (50% Joint and Survivor), Option B (100% Joint and Survivor), and Option C (Ten-Year Guarantee). [Helen] was named beneficiary. This document was signed by Katsumi . . . and subsequently notarized on January 3, 1994 pursuant to instructions. . . . 7. The reverse side of the Application for Service Retirement, which Katsumi . . . was instructed to read in order to select his mode of retirement, outlines the same four (4) modes of retirement. For the normal retirement, it states, Normal retirement allowance payable for life. There is no reference to a beneficiary being entitled to benefits upon death. In contrast, for Option A, Option B, and the Ten-Year Guarantee, a beneficiary who is entitled to benefits upon the retirant's death is specified. The last sentence of this document reads in capital letters, ANY ELECTION OF A MODE OF RETIREMENT IS IRREVOCABLE FROM THE EFFECTIVE DATE OF RETIREMENT. . . . 8. As supported in [Helen]'s affidavit, and undisputed by [Helen], in March 1994, Katsumi . . . was diagnosed with cancer and was admitted to Kuakini Medical Center from March 3, 1994 to March 25, 1994. . . . He was again readmitted on April 2, 1994, and passed away on April 6, 1994 at the hospital. 9. Upon being diagnosed with cancer in March 1994, Katsumi. . . did not contact or notify ERS, or make any changes with regard to his retirement plan, including method of retirement. This would also include advancing his retirement date since the uncontroverted evidence shows that he did this in December 1993.[ [5] ] 10. There is no evidence that[,] other than submitting two written questions to ERS by mail on his Request for Retirement Estimates on November 21, 1993 . . . , Katsumi . . . ever scheduled an office visit or called ERS for information. 11. There is no dispute that at the time of Katsumi['s] . . . death, his selected method of retirement was normal and that he had retired on April 1, 1994. 12. Upon the death of Katsumi . . . , his surviving spouse and beneficiary, . . . Helen . . . , was notified by ERS that under the normal retirement method selected by Katsumi . . . , the only benefit payable would be the final payment of pension between the date of retirement to date of death ( i.e., April 1, 1994, to April 6, 1994). The estimated and approximated amount was $46.00 and would be payable to [Helen] as named beneficiary. 13. If Katsumi . . . had not died, as a retired member, he would have been receiving the maximum monthly pension permitted due to his selection of the normal method of payment of the retirement allowance. 14. Approximately four and one-half years later, on November 17, 1998, [Helen] filed a Petition to the [ERS Board] for Declaratory Order allowing [her] to select a new mode of retirement for . . . Katsumi . . . , to be effective retroactively to April 1, 1994. 15. There is nothing in the documents sent to Katsumi . . . to suggest that election of any of the methods of retirement other than normal retirement would result in loss of service credit, loss of accumulated sick leave, and loss of military service. 16. Designating a beneficiary for the normal method of retirement is for purposes of informing ERS to whom to pay the balance of the member's pension if the member dies before payment is made to him or her. 17. There is no statutory provision permitting a deceased member's beneficiary to change the deceased member's method of retirement, including unforeseen circumstances. 18. Upon review of the ERS forms and documents completed and submitted by Katsumi . . . , it does not appear that he had trouble understanding the forms or following instructions. There is no credible evidence in the record that Katsumi . . . did not understand. 19. The [ERS] Board finds that [Helen] is speculating on what Katsumi . . . did or intended. 20. The [ERS] Board adopted [Hawai`i Administrative Rules (HAR)] section 6-26-3 which requires all applications for retirement benefits to contain certain information, including [t]he mode of retirement which the member elects under any of the plans for receiving retirement allowances described in [HRS] section[s] 88-83 [(1993)],[ [6] ] 88-282, and 88-283. . . . HAR section 6-26-3(a)(6).