An administrative determination made without a pre-determination hearingmust have a "rational basis" and may not be "arbitrary and capricious”
The Court of Appeals decision in this case sets out the standard of review usedby courts when considering appeals from administrative decisions made without first holding a hearing.
A fire lieutenant [Lieutenant] with the City of Long Beach Fire Departmentapplied for accidental disability retirement benefits pursuant to Retirementand Social Security Law [RSSL] §363-c. The State Comptroller grantedLieutenant’s application.
Lieutenant than sought supplemental disability retirementbenefits from the City pursuant to General Municipal Law §207-a.
GML §207-a provides that an individual subject to its provisions receiving a retirement allowance as the result of disability incurred in performance of duty pursuant to §363-c ofthe RSSL, or similar accidental disability pension provided by the retirementsystem of which he or she is a member, “shall continue to receive from the municipality or fire district bywhich he [or she] is employed, until such time as he [or she] shall haveattained the mandatory service retirement age applicable to him [or her] orshall have attained the age or performed the period of service specified byapplicable law for the termination of his [or her] service, the differencebetween the amounts received under such allowance or pension and the amount ofhis [or her] regular salary or wages.”*
The Fire Commissioner denied Lieutenant’s request for a GML §207-a supplement withoutexplanation, which determination was subsequently sustained by theCity's Corporation Counsel. Lieutenant then filed an Article 78 proceedingchallenging the City of Long Beach's decision.
Supreme Court annulled the City's determination and directedit to pay Lieutenant the GML §207-a supplemental benefit. The Appellate Division affirmed the Supreme Court’s ruling.
The Court of Appeals agreed with the Appellate Division’sruling, explaining that in reviewing the City's determination, which was madewithout a hearing, the issue is whether the action taken by the administrativeagency had a "rational basis" and was not "arbitrary andcapricious." An action is arbitrary and capricious, said the court, if itis taken “without sound basis in reason or regard to the facts." In contrast, noted the court, if the administrative determinationhas a rational basis, it will be sustained, even if a different result wouldnot be unreasonable.
According to the Court of Appeals’ decision the City'sdenial of the GML §207-a supplement was based on statements made by Lieutenant's estranged wife in the midstof a divorce and the Corporation Counsel's personal observations of Lieutenant.
As Lieutenant not given any notice of the allegations nor an opportunity torespond to them,** despite the substantial contrary record evidence, includingmedical findings, that led to the approval of Lieutenant's application fordisability benefits by the State Employees’ Retirement System, the Court ofAppeals said that it agreed with the Appellate Division’s conclusion that theCity's justification for its denial of payment of the benefits to be providedin accordance with GML §207-a “lacks the requisite rational basis and was,therefore, arbitrary and capricious.”
* N.B.This supplementation of a disability retirement benefit is unique to individuals within the ambit of GML §207-a. GML§207-c, which is applicable to law enforcement personnel disabled in the lineof duty and who are subsequently granted an accidental disability or similarretirement benefit are not eligible to received a GML §207-a type “supplementation”to their disability related retirement allowance pursuant to GML §207-c except in certain situations such as the one considered by the court in Matter of the Arbitration between the City of Plattsburgh andPlattsburgh Police Officers, 250 AD2d 327.
** Although as a general rule the payment of thesupplement authorized by GML §207-a is a function of the individual's receivinga disability retirement allowance, GML §207-a.6 provides for the forfeiture ofthe supplement under certain conditions. In view of this decision, prudencesuggests that such forfeiture of the supplement pursuant to GML §207-a.6 shouldbe effected only after notice and hearing.
The decision is posted on the Internet at:http://www.courts.state.ny.us/reporter/3dseries/2013/2013_00954.htm
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GeneralMunicipal Law §§207-a and 207-c - Disability Leave for fire, police and otherpublic sector personnel- a 1098 page e-book focusing on administering General Municipal Law Sections207-a/207-c and providing benefits thereunder. For more information click on http://section207.blogspot.com/
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