Court Opinion

ID: 4428648
Source: CourtListenerOpinion
Date Created: 2019-08-20 19:10:20.637095+00
Date Added: 2024-06-11T14:50:43.880259
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                                APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.

                                                         SUPERIOR COURT OF NEW JERSEY
                                                         APPELLATE DIVISION
                                                         DOCKET NO. A-1342-17T3

NEWARK FIREFIGHTERS
UNION, INC.,

          Petitioner-Appellant,

v.

BOARD OF TRUSTEES, POLICE
AND FIREMEN'S RETIREMENT
SYSTEM,

     Respondent-Respondent.
_______________________________

                   Argued January 22, 2019 – Decided May 6, 2019

                   Before Judges Haas, Sumners and Mitterhoff.

                   On appeal from the Board of Trustees of the Police and
                   Firemen's Retirement System, Department of the
                   Treasury, Loc No. 3-21101.

                   Craig S. Gumpel argued the cause for appellant.

                   Michael A. D'Anton argued the cause for respondent
                   City of Newark (Chasan Lamparello Mallon &
                   Cappuzzo, PC, attorneys; Michael A. D'Anton, of
                   counsel and on the brief).
            Robert S. Garrison, Jr., Deputy Attorney General,
            argued the cause for respondent Board of Trustees
            (Gurbir S. Grewal, Attorney General, attorney; Melissa
            H. Raksa, Assistant Attorney General, of counsel;
            Robert S. Garrison, Jr., on the brief).

PER CURIAM

      The Board of Trustees, Police and Firemen's Retirement System (the

Board) rendered a Final Administrative Determination (Final Decision) that

declined to assess a delinquent enrollment penalty against the City of Newark

(Newark) for forty-nine out of the fifty-seven Police and Firemen's Retirement

System (PFRS) pension enrollment applications by firefighter members of the

petitioner Newark Firefighters Union, Inc. (NFU), which it claimed were

untimely submitted. The Final Decision turned on the Board's refusal to declare

there was an inconsistency between a Board regulation, N.J.A.C. 17:1-3.1(b),

and a statute, N.J.S.A. 43:16A-15.1, which governs the time within which a

PFRS pension enrollment application must be submitted to the Division of

Pension and Benefits (the Division). For the reasons that follow, we affirm for

the reasons set forth in the Final Decision except for one firefighter for whom

we conclude Newark must pay an enrollment penalty under N.J.S.A. 43:16A -

15.1 for the untimely submission of his PFRS pension enrollment application.

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                                        I.

      Between October 2011 and November 2013, the City of Newark appointed

four classes of firefighters.   On July 2, 2014, NFU's counsel wrote to the

Division's Enrollment Bureau questioning Newark's compliance with the

pension statutes regarding the firefighters' PFRS enrollment, and requested a

meeting to address these concerns. A few weeks later, counsel sent a follow-up

letter to the Enrollment Bureau, concerning the failure to address PFRS

enrollment status of numerous NFU members, and raising additional issues with

respect to enrollment of certain firefighters.

      When counsel did not receive any response from the Division, counsel

wrote a letter on July 23 to the Director of the Division reiterating NFU's request

for a meeting to address ongoing enrollment issues in the PFRS, and included

the July 2 and July 23 letters. Neither the Enrollment Bureau nor the Director

responded to the letters or NFU's request for a meeting.

      Almost a year later, on May 29, 2015, NFU filed a Superior Court

complaint against Newark and the Division. The complaint sought: 1) the

immediate PFRS enrollment of any unenrolled firefighters; 2) a declaration that

the firefighters' PFRS enrollment was untimely and a delinquent enrollment

penalty should be assessed against Newark; and 3) the declaration that the

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pension regulation, N.J.A.C. 17:1-3.1(b) permitting fourteen months for

enrollment without triggering a delinquency is null and void as contrary to law.

      Following motions for summary judgment by both parties, the trial court

dismissed the action for lack of jurisdiction and directed that the Board hear the

matter upon application.

      In response, NFU petitioned the Board, arguing that N.J.A.C. 17:1-3.1 is

inconsistent with N.J.S.A. 43:16A-15.1.       N.J.S.A. 43:16A-15.1, states, in

relevant part:

            a. In the case of any person who (1) was required to
            become a member of the retirement system as a
            condition of employment, and whose application for
            enrollment in the retirement system or whose
            application for transfer from one employer to another
            within the system was filed beyond the effective date
            for his compulsory enrollment in the system or his
            transfer within the system or (2) is eligible for
            membership on the basis of special legislation, such
            person shall be required to purchase membership credit
            for his compulsory coverage by paying into the annuity
            savings fund the amount required by applying, in
            accordance with section 15 of chapter 255 of the laws
            of 1944, his full rate of contribution on his current base
            salary subject to the retirement system for each year of
            previous service during which he was required to have
            been a member.

            b. If more than 1 year has elapsed from the time that
            contributions would have been required from such
            person, 1/2 of the employee's cost, established by the
            computation provided by subsection a. of this section,

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            will be required of his employer and shall be included
            in the next budget subsequent to the certification of this
            special liability by the retirement system. The amount
            certified by the system shall be payable by the employer
            to the pension accumulation fund and shall be due and
            owing to the system even if the employee is no longer
            in the employ of the employer by the date such moneys
            are to be paid to the system.

Further N.J.A.C. 17:1-3.1 states, in relevant part:

            (a) Employers have a statutory responsibility to enroll
            employees on a timely basis. Employers are required
            to use the available online enrollment applications
            provided through the Employer Pensions and Benefits
            Information Connection (EPIC), to enroll newly hired
            employees.

                   ....

            2. When an employer fails to file an application for
            enrollment even though the employee and employer
            have been advised of the compulsory nature of
            enrollment, the employer shall pay the employee
            contributions required as a result of a delayed
            enrollment, as required by the governing statute and
            pursuant to (b) and (c) below.

                   ....

            (b) For the purpose of establishing an employer's
            liability for payment of the employee contributions on
            delinquently filed enrollment applications, as well as
            the member's requirement to prove insurability, one
            year shall cover the 12-month period elapsing between
            the employee's date of enrollment or transfer and the
            date the enrollment application or report of transfer is
            received by the Division.

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      Specifically, NFU claimed that the employee's date of enrollment or

transfer as used in N.J.A.C. 17:1-3.1 is inconsistent with the requirement in

N.J.S.A. 43:16A-15.1 that employer delinquency is measured from the time that

contributions would have been required. Moreover, NFU argued that N.J.S.A.

43:16A-15.1 requires a delinquent enrollment penalty if pension deductions

were not started within one year from the compulsory date of contribution s,

whereas N.J.A.C. 17:1-3.1(b) only requires the application to be filed.

      Prior to the Board's consideration of the matter, the Division reviewed the

circumstances regarding the enrollment of eleven of the fifty-seven firefighters

at issue, and on April 5, 2017, determined that Newark would be assessed a

delinquent enrollment penalty for only eight of the firefighters whose

applications were untimely filed by Newark. NFU challenged the finding that

there was no delinquent enrollment penalty for the other three firefighters –

Courtney Benjamin, Christopher Dugan and Danny Espaillat – claiming their

applications were incomplete when filed and were not completed within one

year thereafter.

      On June 19, the Board denied NFU’s request, but noted that it would

consider, aside from the delinquent enrollment issue, equitable arguments

regarding the PFRS enrollment of forty-nine firefighters who had sought to

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                                       6
apply the delinquent enrollment statute, N.J.S.A. 43:16A-15.1, to their

respective enrollments in the PFRS.

      NFU requested a reconsideration of the Board's denial, seeking relief on

equitable grounds, independent of the delinquent enrollment issue. The Board,

however, denied the reconsideration request and issued a Final Administrative

Determination (Final Decision) affirming its June 19 determination that there

should be no enrollment penalty for forty-nine firefighters because N.J.A.C.

17:1-3.1(b) is consistent with N.J.S.A. 43:16A-15.1.

                                       II.

      Essentially repeating the arguments it made before the Board – that

N.J.A.C. 17:1-3.1 is inconsistent with N.J.S.A. 43:16A-15.1 and that Newark is

obligated to pay an enrollment penalty for forty-nine firefighters 1 – NFU appeals

arguing:

            POINT I

            THE BOARD OF TRUSTEES OF THE POLICE AND
            FIREMEN’S RETIREMENT SYSTEM’S FINAL
            ADMINISTRATIVE   DETERMINATION      WAS
            ARBITRARY,       CAPRICIOUS         AND
            UNREASONABLE BECAUSE IT INCORRECTLY
            INTERPRETED THE GOVERNING STATUTE,

1
  Initially, the number was fifty-seven firefighters. The Division, as recognized
in the Final Decision, determined that Newark should be assessed the penalty
for eight firefighters.
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[N.J.S.A.] 43:16A-15.1, TO REQUIRE THAT THE
EMPLOYER LIABILITY FOR AN ENROLLMENT
DELINQUENCY BE BASED ON WHETHER THE
APPLICATION FOR ENROLLMENT WAS WITHIN
1 YEAR OF THE COMPULSORY DATE OF
ENROLLMENT         INSTEAD    OF   WHETHER
CONTRIBUTIONS COMMENCED WITHIN 1 YEAR
OF THE PFRS COMPULSORY ENROLLMENT
DATE.

POINT II

THE BOARD OF TRUSTEES OF THE POLICE AND
FIREMEN’S RETIREMENT SYSTEM’S FINAL
ADMINISTRATIVE DETERMINATION IS NOT
ENTITLED TO DEFERENCE BECAUSE THE
BOARD’S    INTERPRETATION     OF     THE
GOVERNING STATUTE, [N.J.S.A.] 43:16A-15.1,
IMPERMISSIBLY ALTERS THE LEGISLATIVE
ENACTMENT AND FRUSTRATES THE POLICY
EMBODIED IN THE STATUTE.

POINT III

THE BOARD OF TRUSTEES OF THE POLICE AND
FIREMEN’S RETIREMENT SYSTEM’S FINAL
ADMINISTRATIVE          DETERMINATION   WAS
ARBITRARY,              CAPRICIOUS      AND
UNREASONABLE BECAUSE THE LEGISLATIVE
HISTORY OF THE GOVERNING STATUTE,
[N.J.S.A.] 43:16A-15.1, DOES NOT SUPPORT THE
PFRS     BOARD’S       DETERMINATION   THAT
EMPLOYER LIABILITY FOR AN ENROLLMENT
DELINQUENCY IS BASED ON WHETHER THE
APPLICATION FOR ENROLLMENT WAS FILED
WITHIN 1 YEAR OF THE COMPULSORY DATE OF
ENROLLMENT.

                                               A-1342-17T3
                     8
            POINT IV

            THE BOARD OF TRUSTEES OF THE POLICE AND
            FIREMEN’S RETIREMENT SYSTEM’S FINAL
            ADMINISTRATIVE     DETERMINATION     WAS
            ARBITRARY,         CAPRICIOUS         AND
            UNREASONABLE BECAUSE [N.J.A.C.] 17:1-3.1 IS
            INCONSISTENT    WITH     THE    GOVERNING
            STATUTE, [N.J.S.A.] 43:16A-15.1, AND THE
            BOARD RELIED ON [N.J.A.C.] 17:1-3.1 IN
            REJECTING THE NFU['S] REQUEST TO ASSESS
            THE CITY OF NEWARK A DELINQUENCY FOR
            ITS UNTIMELY ENROLLMENT OF CERTAIN
            MEMBERS OF THE NFU.

            POINT V

            ASSUMING, ARGUENDO, THAT THE BOARD'S
            INTERPRETATION OF THE STATUTE IS
            CORRECT, AND THE DELINQUENCY IS
            DETERMINED BASED ON 12 MONTHS BETWEEN
            DATE OF COMPULSORY ENROLLMENT AND
            DATE APPLICATION IS RECEIVED, THE
            DIVISION OF PENSIONS AND BENEFITS MUST
            ASSESS THE CITY OF NEWARK FOR THE
            DELINQUENT ENROLLMENT OF THREE OR
            MORE FIREFIGHTERS IN THE PFRS.

      To determine whether the Board correctly decided that Newark was not

obligated to make delinquent enrollment penalties for forty-nine firefighters'

PFRS enrollment contributions because the city did not timely enroll them in

PFRS, requires us to consider the Board's interpretation of N.J.A.C. 17:1-3.1(b)

and N.J.S.A. 43:16A-15.1. In doing so, we must be guided by deferential

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                                       9
principles of limited appellate review. "'An administrative agency's final quasi-

judicial decision will be sustained unless there is a clear showing that it is

arbitrary, capricious, or unreasonable, or that it lacks fair support in the record.'"

Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J. 14, 27 (2011)

(quoting In re Herrmann, 192 N.J. 19, 27-28 (2007)).

      "Generally,    courts   afford   substantial    deference to     an   agency's

interpretation of a statute that the agency is charged with enforcing."

Richardson v. Bd. of Trs., Police & Firemen's Ret. Sys., 192 N.J. 189, 196

(2007). "Such deference has been specifically extended to state agencies that

administer pension statutes[,]" because "'a state agency brings experience and

specialized knowledge to its task of administering and regulating a legislat ive

enactment within its field of expertise.'" Piatt v. Police & Firemen's Ret. Sys.,

443 N.J. Super. 80, 99 (App. Div. 2015) (quoting In re Election Law Enf't

Comm'n Advisory Op. No. 01-2008, 201 N.J. 254, 262 (2010)). We likewise

defer to an agency's interpretation of regulations within its implementing and

enforcing responsibility. See Utley v. Bd. of Review, Dep't of Labor, 194 N.J.

534, 551 (2008) (citations omitted). Nonetheless, we are not bound by an

agency's interpretation of law. Wnuck v. N.J. Div. of Motor Vehicles, 337 N.J.

Super. 52, 56 (App. Div. 2001).

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      The primary purpose of "statutory interpretation is to determine and

'effectuate the Legislature's intent.'" State v. Rivastineo, 447 N.J. Super. 526,

529 (App. Div. 2016) (quoting State v. Shelley, 205 N.J. 320, 323 (2011)). We

initially consider "the plain 'language of the statute, giving the terms used

therein their ordinary and accepted meaning.'" Ibid. "We will not presume that

the Legislature intended a result different from what is indicated by the plain

language or add a qualification to a statute that the Legislature chose to omit."

Tumpson v. Farina, 218 N.J. 450, 467-68 (2014) (citing DiProspero v. Penn, 183

N.J. 477, 493 (2005)). When we do not conclude that the "plain reading of the

statutory language is ambiguous, . . . or leads to an absurd result," we refrain

from looking at "extrinsic evidence, such as legislative history, committee

reports, and contemporaneous construction in search of the Legislature's intent."

Id. at 468 (citing DiProspero, 183 N.J. at 492-93).

                                       A.

      Applying these principles, we affirm substantially for the reasons stated

by the Board in its Final Decision. The Board reasoned that:

            [N.J.S.A.] 43:16A-15.1(a) refers to an individual
            "whose application for enrollment in the retirement
            system or whose application for transfer from one
            employer to another within the system was filed beyond
            the effective date for his compulsory enrollment in the
            system or his transfer within the system." [N.J.S.A.]

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            43:16A-15.1(b) measures the timeframe for delinquent
            enrollment as one year "from the time that contributions
            would have been required from such person."
            [N.J.A.C.] 17:1-3.1(b) measures delinquent enrollment
            as one year from "the employee's date of enrollment or
            transfer" which is the same language as used in
            [N.J.S.A.] 43:16A-15.1(a). Therefore, the statute and
            regulation use consistent language. The statute and the
            regulation both provide the employer with the same one
            year to file an enrollment application to the Division.
            Neither the statute nor the regulation requires pension
            deductions to be taken within the year. The Board
            noted that there were delays in Newark's responses to
            the Division's request for additional information during
            the enrollment process. However, these delays were
            after the completed application was timely filed by
            Newark. The information requested by the Division is
            not part of the application itself, therefore, the Board
            determined that the regulation is valid[,] and the
            Division's application of the regulation is consistent
            with the statute.

            [(emphasis added).]

We discern no basis for disturbing the Board's decision and affirm substantially

for the reasons stated in the Final Decision. We add the following brief remarks.

      The Board's decision is supported by a plain reading of the statute and

regulation. Contrary to NFU's contention, neither the statute nor the regulation

requires pension deductions to be taken within the year that the enrollment

application must be filed. The statute merely provides, "[i]f more than [one]

year has elapsed from the time that contributions would have been required . . .

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                                      12
[,]" the employer must pay "[one-half] of the employee's cost[.]" N.J.S.A.

43:16A-15.1(b). Once the enrollment process is complete, the employee and

employer will receive a notice showing the date that pension deductions will

begin, the rate of contribution, and any back deductions due.

      There is no dispute that enrollment contributions are owed starting on the

compulsory date of enrollment. The issue is determining when the clock starts

for the tolling of delinquent contributions. The one-year period referred to in

the statute determines the time that must elapse after pension contributions are

due before the Division may assess an enrollment penalty on the employer. It

has nothing to do with the time period required to file the enrollment application.

On the other hand, the regulation limits the time period to one year from the

compulsory enrollment date for the employer to file the enrollment application.

Simply put, the regulation is aligned with the legislative intent and is meant to

keep employers accountable. Furthermore, we agree with the Board's logic that

it makes sense for enrollment contributions to begin only when a member is

enrolled in PFRS because there are additional requirements such as training and

submitting proper medical certifications, other than the filing of the application

that needs to be fulfilled before an employee may be enrolled in PFRS.

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                                      B.

      Having determined the Board's interpretation of N.J.A.C. 17:1-3.1 and

N.J.S.A. 43:16A-15.1 is correct, we turn to NFU's argument that the Board

arbitrarily failed to impose a delinquent enrollment penalty for firefighters

Benjamin, Dugan and Espaillat for submitting their enrollment applications

more than a year after their compulsory enrollment date.

      NFU maintains that despite the Division's three written requests to

Newark, advising that the enrollment applications for Benjamin and Dugan

could not be processed due to documents not provided by the city, their

completed applications were not received until December 11, 2014, beyond the

twelve-month period from the compulsory enrollment date of December 1, 2013.

Therefore, NFU contends the Board's failure to assess the city for Benjamin and

Dugan's delinquent filings was arbitrary and should be reversed. We disagree.

      Based upon our review of the record, we are satisfied the credible

evidence supports the Board's decision that no enrollment penalty should be

imposed for Benjamin and Dugan because it received their completed

enrollment applications on May 28, 2014, five months after their December 1,

2013 compulsory enrollment date. The Board stresses that the delays occurred

after Newark timely filed the enrollment applications because of a holdup in

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                                     14
receiving their medical certifications and the Division's request to Newark for

additional information. Given our deference to the Board's decision-making, we

discern no reason to disturb its ruling not to assess an enrollment penalty on

Newark for Benjamin and Dugan's enrollment applications.

      With respect to Espaillat, we reach a different result and reverse the

Board's ruling that Newark should not have been penalized for tardy submission

of his enrollment application. NFU contends that a penalty was warranted as

Espaillat's enrollment application was received on May 10, 2015, more than one

year from his compulsory enrollment date of December 1, 2013. The Division

disagrees, contending his application was filed on May 28, 2014, within the one-

year deadline of December 1, 2013.

      Based on the record before us, NFU is correct. Espaillat's enrollment

application shows a date stamp of May 10, 2015, not May 28, 2014. The Board

therefore erred in not assessing an enrollment penalty under N.J.S.A. 43:16A-

15.1 on Newark for its submission of Espaillat's application over one year after

his compulsory enrollment date. Accordingly, Newark must pay an enrollment

penalty for its untimely submission of Espaillat's application.

      Affirmed in part, and reversed in part.

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