AND ANNUITY FUND MAY WE PLEASE HAVE APPEARANCES.
(APPEARANCES TENDERED.) CHIEF JUSTICE RABNER: GOOD MORNING,
COUNSEL, AND WELCOME. MS. NAPRSTEK CERISANO, PLEASE.
KATHLEEN NAPRSTEK CERISANO: MAY IT PLEASE THE COURT, CHIEF JUSTICE RABNER, ASSOCIATE
JUSTICES, I APPEAR BEFORE YOU THIS MORNING WITH THE IMPORTANT GOAL OF RECTIFYING
A SERIOUS DISSERVICE TO A LONG SERVING AN LOYAL PUBLIC SCHOOL EMPLOYEE, SUSAN SEAGO
WHOSE RETIREMENT BENEFITS WILL BE SIGNIFICANTLY DECREASED BECAUSE OF THE
ADMITTED AN UNDISPUTED NEGLIGENCE AND CARELESSNESS OF HER EMPLOYER.
HER REQUEST TO PROCESS AN UNFORTUNATELY UNTIMELY INTERFUPD TRANSFER OF 13 YEARS
OF PENSION CREDITED FROM HER TIER 1 PERS ACCOUNT TO HER CURRENT TEAR 5 T
PACK ACCOUNT WAS DENIED BY, INTERFUND TRANSFER REGULATIONS BY THE BOARD OF TRUSTEES,
WHO REFUSED TO EXERCISE ITS EQUITABLE AUTHORITY TO RELAX THE FILING
DEADLINES WHEN PRESENTED WITH THESE VERY PARTICULAR FACTS OF THIS CASE.
THIS RUNS CONTRARY TO PRIOR COURT RULINGS THAT PENSION BOARDS SHOULD
NOT ACT AN TAG FWON NIS STICKLY TO THE BEST INTERESTS OF THEIR MEMBERS,
PARTICULARLY THOSE MEMBERS WHO FOLLOW THE GUIDANCE OF THEIR EMPLOYERS.
VERY SIMPLY, MRS. SEAGO COMPLETED THE MEMBERS PORTION OF THE APPLICATION FOR INTER
FUND TRANSFER AS SOON AS SHE WAS HIRED BY EDISON BOARD OF EDUCATION FOR A
TEACHING POSITION. SHE HAD BEEN EMPLOYED FOR 13 YEARS BY EDISON AS A PARAPROFESSIONAL
AN HAD CONTINUED HER EDUCATION. AND SHE COMPLETED THIS FORM A FEW MONTHS
BEFORE SHE BEGAN TEACHING. SHE WAS REQUIRED TO COMPLETE THE EDISON
WAS REQUIRED TO COMPLETE THE EMPLOYER SECTION AND FORWARD THAT FORM TO THE
DIVISION OF PENSIONS WHEN IT ENROLLED HER INTO THE TPAF. UNFORTUNATELY, WE
SUBSEQUENTLY LEARNED, EDISON LEARNED THEY HAD FAILED TO FILE TIMELY THE
APPLICATION. IT MADE NUMEROUS REQUESTS TO THE DIVISION, THAT THE TRANSFER THOUGH
UNTIMELY BE PROCESSED BECAUSE IT WAS EDISON, NOT MS. SEAGO WHO WAS NEGLIGENCE
IN FILING THE APPLICATION WITH THE DIVISION AN COMPLETING THE INTERFUND TRANSFER
PROCESS. THE TPAF BOARD'S DENIAL OF THE INTERFUND TRANSFER
WAS SANCTIONED BY THE APPELLATE COURT, WHICH WAS SO FIX YATD ON A STATEMENT IN
THE INTERFUND TRANSFER REGULATION THAT A MEMBER DESIRING TO TRANSFER SERVICE
CREDIT AN CONTRIBUTIONS FROM ONE STATE RETIREMENT SYSTEM TO ANOTHER MUST FILE AN
APPLICATION FOR INTERFUND TRANSFER. THEY INTERPRETED THIS
TO MEAN THAT IT WAS THE EMPLOYEE, THE MEMBER'S RESPONSIBILITY TO FILE THAT
APPLICATION FOR INTERFUND TRANSFER, NOT THE EMPLOYER'S. THIS IS
INCORRECT. IT'S PROCEDURALLY WRONG. ITS EEGS CONTRADICTED BY THE EXPRESS STATEMENT
ON THE APPLICATION FORM THAT IT MUST BE FILED WITH THE ENROLLMENT APPLICATION
FOR THE NEW PENSION SYSTEM. AND ENROLLMENT APPLICATIONS INTO PENSION SYSTEMS
ARE NOT FILED BY MEMBERS, BY EMPLOYEES, THEY ARE FILED BY THE EMPLOYER.
PROBABLY A TECHNICALITY THAT CAME UP WITH THIS IS THAT THESE
PAPER APPLICATIONS FOR INTERFUND TRANSFER AND EMPLOYERS NOW FOR AT LEAST A DECADE
OR SO HAVE FILED -- ENROLLED PEOPLE INTO THE PENSION SYSTEM THROUGH ELECTRONIC
MEANS SO THEY ARE NOT -- IT'S NOT AS IF BOTH PAPERS ARE GOING AT THE SAME TIME.
BOTH THE TPAF AND THE APPELLATE COURT FAILED TO SEE THE
SIGNIFICANCE OF MS. SEAGO'S PUBLIC EMPLOYER'S ROLE IN PROCESSING THE APPLICATIONS
FOR INTERFUND TRANSFER. INSTEAD THEY PLACED THE SOLE RESPONSIBILITY FOR
PROCESSING THIS ON MS. SEAGO. THEY REJECTED ANY ARGUMENT THAT THIS SITUATION WARRANTS
THE APPLICATION OF BLANK RELIEF. THE TPAF BOARD DOES HAVE
DISCRETION, EVEN THOUGH THEY WANTED TO DENY THAT, TO EXERCISE EQUITABLE AUTHORITY
TO RELAX DEADLINES, REOPEN CASES, OVERLOOK TECHNICAL ERRORS MADE IN GOOD FAITH
WHEN THE CIRCUMSTANCES WARRANT. THIS ISN'T AND SHOULDN'T, AS
THEY ARGUED, BE LIMITED TO JUST THOSE SITUATIONS INVOLVING FALSE INFORMATION
OR LACK OF INFORMATION FROM SOMEONE AT THE DIVISION OF PENSIONS. EMPLOYEES HAVE
A RIGHT TO WORK WITH THEIR EMPLOYER TO TRUST THEIR EMPLOYERS, TO BELIEVE THAT
TASH DASH TO CONSULT WITH THEM ABOUT THEIR VARIOUS EMPLOYMENT SITUATIONS,
INCLUDING, THEIR PENSION RETIREMENT BENEFITS. THOSE
STATEMENTS IN DIVISION OF PENSION MATERIALS THAT ADVISE THEM TO DO SO.
MS. SEAGO REASONABLY CONSULTED WITH AND RELIED UPON THE INFORMATION PROVIDED TO
HER BY EDISON, WITH WHOM SHE HAD A LONG STANDING EMPLOYMENT RELATIONSHIP
WITH NO REASON NOT TO BELIEVE THEIR REINSURANCES ABOUT THE FILING OF HER
APPLICATION FOR INTERFUND TRANSFER. HER REQUEST FOR AN INTER
FUND TRANSFER SHOULD AND MUST BE APPROVED. THIS WILL ALLOW HER TO RECEIVE THE
BENEFIT OF HER TIER 1 MEMBERSHIP STATUS. HER CURRENT IS IN TIER 1,
HER TPAF IS AT TIER 5 BECAUSE BY THE TIME SHE BECAME A TEACHER AN WAS ENROLLED,
THEY WOULD HAVE ENROLLED HER AND THEY DID IN TIER 5. SHE IS SUFFERING A SIGNIFICANT
FINANCIAL LOSS BY HAVING HER RETIREMENT BENEFITS CALCULATED AS A TIER 5 MEMBER
VERSUS A TIER 1. THE COURT: COUNSEL, YOU'RE FAMILIAR WITH THE
ARGUMENTS THAT HAVE BEEN VOICED ON THE OTHER SIDE AND THE CONCERN ABOUT 'HARM TO
THE PENSION FUND ITSELF. CAN YOU IDENTIFY FOR US SPECIFIC AND NARROW
GROUNDS THAT WOULD SUPPORT THE RELIEF YOU'RE REQUESTING WITHOUT AFFECTING
THE INTEGRITY OF THE FUND. KATHLEEN NAPRSTEK CERISANO: THIS MONEY
TASH DASH IF IT'S ALL RIGHT, MAY I GET SOME WATER? CHIEF
JUSTICE RABNER: OF COURSE. WE'RE LOOKING FOR A LEGAL PRINCIPLE.
KATHLEEN NAPRSTEK CERISANO: WELL, THEY'VE ALLOWED -- THE
COURTS HAVE IN THESE VARIOUS CASES HAVE ALLOWED MEMBERS TO RELAX THE RULE UNDER
PARTICULAR CIRCUMSTANCES. IN THIS CASE, MS. SEAGO DID FILE
HER APPLICATION. SHE FILED HER APPLICATION WITH HER EMPLOYER. SHE
GAVE IT TO HER EMPLOYER. SHE EXPECTED HER EMPLOYER TO PROCESS THAT. THERE ARE
VARIOUS SITUATIONS IN AND THIS PARTICULAR ONE WAS AN INTERFUND TRANSFER.
THE STATUTE DOESN'T PARTICULARLY SAY THAT AN EMPLOYER HAS TO -- IT DOESN'T PUT
ANY IMPOSITION, ANY PENALTY ON THE EMPLOYER. THAT IS THE CASE WITH
DELINQUENT ENROLLMENT AND INTERFUND TRANSFERS WHERE THE EMPLOYER TAKES TOO LONG
TO TRANSFER SOMETHING TO FILE IT, TO ENROLL SOMEBODY. THERE ISN'T ONE IN THIS
CASE. IT IS AN OPTIONAL. JUSTICE PATTERSON: SO WHAT IS
THE LEGAL PRINCIPLE THAT WOULD PROVIDE YOU RELIEF IN A NARROW WAY THAT WOULD
NOT LOOP IN A MULTITUDE OF SITUATIONS THAT MIGHT BE DIFFERENT FROM YOUR CASE.
KATHLEEN NAPRSTEK CERISANO: THE LEGAL PRINCIPLE IS THAT THE
COURT HAS THE AUTHORITY OR -- AN THE DIVISION, THE AGENCY, TO REOPEN
ADMINISTRATIVE MATTERS UPON THE SHOWING OF GOOD CAUSE, REASONABLE GROUNDS
AND REASONABLE DILIGENCE. THE CASES THAT WE PRESENTED IN OUR BRIEF AND IN OUR
APPELLATE PREEF REFLECT THAT. IN THIS CASE --
THE COURT: ARE THERE. CHIEF JUSTICE RABNER: ARE THERE FACTORS YOU
WOULD SUGGEST WE LOOK TO TO GUIDE THAT DISCRETION? KATHLEEN
NAPRSTEK CERISANO: THERE ARE FACTORS. IN THIS CASE, MS. SEAGO,
SHE -- THE GOOD CAUSE IS SHE WENT TO HER EMPLOYER. SHE FILED THIS PAPER WITH
HER EMPLOYER PROMPTLY. THE EMPLOYER -- SHE RECEIVED ASSURANCES SEVERAL TIMES FROM
HER EMPLOYER. WE UNDERSTAND SHE DID NOT CONTACT THE DIVISION OF PENSIONS. SHE
LOOKED AT THE PAPER. SHE BROUGHT THE PAPERS TO HER EMPLOYER, TO SOMEONE A BA AND
THE PERSON OVER THERE IN THE PAYROLL DEPARTMENT AN SHE PURSUED THAT REASONABLE
DILIGENCE THERE, GOING BACK TO HER EMPLOYER, QUESTIONING THEM. THEY RE
ASSURED HER THAT THEY HAD FILED, THAT THE PAPERWORK HAD BEEN FILED.
THE COURT: LET ME ASK YOU, IF YOU COULD TO JUST STEP BACK FROM THE FACTS FOR A
SECOND. YOU'RE ABLY PRESENTING THAT ARGUMENT. ARE THERE
PRINCIPLES THAT CAN GUIDE THESE SORTS OF DECISIONS IN THIS AS WELL AS WITH AS OTHER
CASES THAT YOU WILL NOW ARTICULATE FOR US. KATHLEEN NAPRSTEK
CERISANO: THE PRINCIPLES THAT ARE SET FORTH IN. JUSTICE
PATTERSON: THE SAME PRINCIPLES YOU WERE JUST TALKING ABOUT.
KATHLEEN NAPRSTEK CERISANO: YES, THE SAME PRINCIPLES. LISTEN
THE COURT -- SAF SAV VAJ, THAT WAS A VERY DIFFERENT CASE FACTUALLY WHERE IT WAS
SOMEONE WHO HAD LOST THEIR PENSION, AN INDIVIDUAL WHO WOULD HAVE LOST HER
HUSBAND'S PENSION. IN OTHER CASES THAT WE HAVE, THERE IS --
JUSTICE PATTERSON: CAN I ASK YOU A HYPOTHETICAL THAT DIFFERS FROM
YOUR CLIENT'S FACTS; THAT IS, WOULD YOU ARGUE THAT THERE SHOULD BE RELIEF IF, FOR
EXAMPLE, SOMEONE -- AN EMPLOYEE WAS TOLD BY A SCHOOL DISTRICT, OH, DON'T
WORRY ABOUT THAT APPLICATION, WE'LL TAKE CARE OF IT AND HAD NOT ACTUALLY FILLED
OUT PART OF THE APPLICATION? KATHLEEN NAPRSTEK CERISANO:
YES. THERE HAS BEEN SUBSTANTIAL COMPLIANCE HERE. JUSTICE
PATTERSON: YOU'RE NOT HEARING MY QUESTION. I AM NOT ASKING WHAT SHE DID. I AM
ASKING WHETHER -- SO WE CAN EXPLORE THE DIMENSIONS OF THE RULE YOU'RE LOOKING
FOR, I AM ASKING YOU WHETHER YOU WOULD INCLUDE AN APPLICATION BY SOMEONE WHO SAID,
WELL, I TALKED TO THEM AND THEY SAID THEY'D TAKE -- SOMETHING TO THEM.
KATHLEEN NAPRSTEK CERISANO: NO, YOUR HONOR. JUSTICE
PATTERSON: SO THAT'S A NO. SO WHAT'S THE PRINCIPLE DISTINCTION THAT
SEPARATES YOUR CASE -- LET ME FINISH THE QUESTION. DON'T ANSWER THE QUESTION
YOU HAVEN'T HEARD THE WHOLE THING. YOU MAY NOT AGREE WITH ME.
ARE YOU SAYING THAT THE DISTINCTION IS THAT IF THE APPLICATION OR THE PORTION OF THE
APPLICATION FOR WHICH THE EMPLOYEE IS RESPONSIBLE HAS BEEN FILLED OUT AND
SUBMITTED TO THE EMPLOYER, IS THAT THE TEST HERE OR PART OF THE TEST?
KATHLEEN NAPRSTEK CERISANO: THAT IS PART OF THE TEST. THE EMPLOYEE HERE, SHE
UNDERSTOOD -- I KNOW THERE ARE VARIOUS SITUATIONS. PEOPLE DON'T EVEN KNOW
THAT THEY CAN DO THIS INTERFUND TRANSFER. THAT'S NOT WHAT WE'RE TALKING ABOUT.
SHE UNDERSTOOD ABOUT THE INTERFUND TRANSFER. SHE UNDERSTOOD THE CONSEQUENCES OF
DOING AN INTERFUND TRANSFER SO THAT SHE COULD MOVE HER 13 YEARS OVER INTO
HER NEW ACCOUNT AND SO THAT SHE COULD MAINTAIN HER TIER 1 MEMBERSHIP.
JUSTICE PIERRE-LOUIS: WHAT IS THE OTHER PART? WHAT
ADDITIONALLY DO EMPLOYERS -- KATHLEEN NAPRSTEK CERISANO:
JUSTICE PIERRE-LOUIS: HOLD ON. KATHLEEN NAPRSTEK CERISANO:
OKAY. JUSTICE PIERRE-LOUIS: WHAT ADDITIONAL STEPS MUST AN
EMPLOYEE TAKE IN ORDER TO ENSURE WHAT WE UNDERSTAND IS THE TEST YOU'RE ARTICULATING
TO ENSURE THAT THEY HAVE REASONABLY AND DILIGENTLY COMPLETED THEIR PORTION
OF WHAT NEEDS TO BE DONE IN ORDER FOR THIS TRANSFER TO PROCEED?
KATHLEEN NAPRSTEK CERISANO: THE EMPLOYEE HERE SHE -- THE EMPLOYEE NEEDS TO FILL
OUT THE FORM, GIVE IT TO THE EMPLOYER THAT NEEDS TO FILE THAT. IT IS NOT
THE EMPLOYEE'S ROLE TO FILE THAT FORM. USUALLY PENSIONS WILL NOT TAKE FORMS THAT
L PEOPLE ARE FILING LIKE THAT DIRECTLY BECAUSE IT GOES IN CONNECTION WITH THE
APPLICATION FOR THE NEW ACCOUNT SO THE MONEY CAN BE TRANSFERRED INTO THE NEW ACCOUNT.
JUSTICE WAINER APTER: ARE YOU SAYING THAT THE EMPLOYEE CAN
NEVER FILE THE FORM? I UNDERSTAND THE FACTS OF THIS CASE AND THAT
THE HYPOTHETICAL THAT I AM SUGGESTING IS NOT THE FACTS OF THIS CASE, BUT
IF YOU HAD A SITUATION WHERE THE EMPLOYER SAYS, GIVE US OUR PORTION OF THE FORM,
WE'LL FILL IT OUT, COME PICK IT UP NEXT MONDAY AN HERE IS WHO YOU HAVE TO
FAIL MAIL IT TO AN THE EMPLOYEE NEVER SHOWS UP THE FOLLOWING MONDAY, NEVER PICKS
UP THE FORM, NEVER MALS IT. MAILS IT. ARE YOU
SUGGESTING EVEN IN THAT CIRCUMSTANCE? KATHLEEN NAPRSTEK CERISANO:
I COULD ASSUME THEY COULD TRY, IF THEY TOOK THE FORM AND FILED IT WITH THE
DIVISION OF PENSIONS, I AM NOT AWARE AND I WAS GOING TO SAY WHETHER OR NOT THE
DIVISION WOULD SAY THIS NEEDS TO COME FROM THE EMPLOYER. MAYBE THE EMPLOYEE COULD
HAVE DONE THAT. IN THIS CASE WHEN AN EMPLOYEE SUBMITS THEIR
PORTION, GIVES IT TO THE EMPLOYER, THE EMPLOYER SAYS WE'RE GOING TO FILE
THIS, WE'LL FILE THIS WITH YOUR EMPLOYMENT, YOU KNOW, YOU'RE ENROLLMENT
APPLICATION FOR TPAF, SHE FILLED THIS OUT IN JULY AND THEN THEY PROCESSED
IT A MONTH OR TWO LATER, THEY ENROLLED HER IN TPAF. SHE DID
GO BACK TO THEM WHEN SHE RECEIVED NOTIFICATION THAT SAID HER PERS ACCOUNT HAD
NOT HAD ANY MORE CONTRIBUTIONS MADE INTO IT SINCE SOMETIME ABOUT TWO YEARS
PRIOR. JUSTICE WAINER APTER: JUST TO MAKE SURE I UNDERSTAND.
YOU ARE SUGGESTING THAT THE EXERCISE OF REASONABLE DILIGENCE
WOULD DEPEND ON WHAT THE EMPLOYER HAD INDICATED HAD TO HAPPEN NEXT SO IF THE
EMPLOYER SAYS YOU HAVE TO MANY COULD PICK UP THE FORM AND MAIL IT THEN OF
COURSE IT WOULD NOT BE THE EXERCISE OF REASONABLE DILIGENCE TO NEVER PICK UP THE
FORM AN MAIL IT BUT IF THE EMPLOYER SAYS THANK YOU FOR COMPLETING YOUR PORTION,
WE'RE NOW GOING TO SEND IT IN THEN THAT WOULD BE THE ONLY THING THE EMPLOYEE
WOULD BE EX SPEBTD TO DO. KATHLEEN NAPRSTEK CERISANO: CORRECT.
JUSTICE FASCIALE: COUNSEL, I HAVE A QUESTION FOR YOU ABOUT
THE RECORD AND SPECIFICALLY ABOUT A COMMENT THAT YOU MADE.
YOU SAID THAT THE EMPLOYER REASSURED YOUR CLIENT SEVERAL TIMES THAT THE APPLICATION
HAD BEEN FILED. MY FIRST QUESTION IS: DID
THE EMPLOYER REASSURE YOUR CLIENT THAT THE APPLICATION HAD BEEN FILED WITHIN THE
TWO-YEAR PERIOD? DID THEY REASSURE HER THAT WITHIN THE
TWO-YEAR PERIOD? KATHLEEN NAPRSTEK CERISANO: I AM NOT SAL SURE,
YOUR HONOR. I DO KNOW THAT SHE -- WHEN SHE GOT -- EL, YES IT WOULD HAVE BEEN WITHIN
THAT TWO-YEAR PERIOD BECAUSE SHE RECEIVED THAT LETTER IN MARCH OF 2019. IT WAS
ALL WITHIN THAT TWO-YEAR PERIOD. JUSTICE FASCIALE: LET'S TALK ABOUT
THE LETTER. THE LETTER WAS IN MARCH. IT WAS ONE YEAR AND 8 MONTHS AFTER
THE LAST PERS PAYMENT AND THE LETTER SAYS THAT THE DIVISION OF PENSION BENEFITS
NOTIFIED YOUR CLIENT THAT SHE DID NOT CONTRIBUTE TO HER PERS ACCOUNT SINCE
JUNE 30TH, 2017. DID YOUR CLIENT GO TO THE EMPLOYER AT THAT TIME
BEFORE THE TWO YEARS EXPIRED. KATHLEEN NAPRSTEK CERISANO: YES, SHE
DID. JUSTICE FASCIALE: DID THE EMPLOYER ASSURE HER AT THAT
POINT THAT THEY FILED THE APPLICATION? KATHLEEN NAPRSTEK CERISANO:
YES, THEY DID. JUSTICE FASCIALE: WHO, FROM THE EMPLOYER,
ASSURED HER OF THAT? KATHLEEN NAPRSTEK CERISANO: I DON'T HAVE
THE NAME OF THE PERSON. IT WAS SOMEONE IN THE PAYROLL DEPARTMENT, WHO NO LONGER
WORKED IN THE PAYROLL DEPARTMENT SUBSEQUENTLY WHEN THE DOCUMENT WAS FOUND.
LET ME SEE IF I CAN FIND THE NAME OF THE PERSON. CHIEF JUSTICE
RABNER: WAS IT SOMEONE IN PAYROLL OR H R? KATHLEEN NAPRSTEK
CERISANO: IT WAS THE PERSON BACK IN HUMAN RESOURCES PAYROLL, THERE IS A DOCUMENT
IN OUR APPELLATE BRIEF, THE APRIL PEND DICK AT PAGE 20 A WHERE THERE WAS SUPPOSED
TO BE SOME PAYROLL ACTION SO THE INDIVIDUAL THERE IN PAYROLL APPEARS TO BE
THIS KA DEE BAKE KER, SOMEONE WHO SIGNED OFF ON THAT. MY CLIENT HAD TOLD ME
THAT SHE SPOKE TO THE PERSON IN PAYROLL. THEY SAID THEY HAD TAKEN CARE OF IT,
IT HAD BEEN FILED. JUSTICE FASCIALE: THE IMPORTANT POINT
I MAKE IS: DID YOUR CLIENT GO TO THE EMPLOYER AFTER SHE
RECEIVED THE LETTER FROM THE DIVISION IN MARCH BEFORE THE TWO YEARS EXPIRED TO SAY,
DID YOU FILE THE APPLICATION? DID SHE DO THAT?
KATHLEEN NAPRSTEK CERISANO: YES, SHE DID. JUSTICE FASCIALE: AN
THIS PERSON, DOOE, DID HE BAKERY ASSURED HER THAT THE APPLICATION HAD BEEN
FILED. AM I CORRECT? KATHLEEN NAPRSTEK CERISANO:
YES. JUSTICE FASCIALE: THERE WAS NO HEARING, AS I UNDERSTAND
IT? KATHLEEN NAPRSTEK CERISANO: THERE WAS NO HEARING.
JUSTICE FASCIALE: WAS THIS A DISPUTED FACT ABOUT WHETHER SHE
HAD BEEN REASSURED AS YOU POINTED OUT MULTIPLE SEVERAL TIMES, SEVERAL TIMES, BEFORE
THE TWO YEARS EXPIRED THAT THE EMPLOYER HAD FILED THE APPLICATION?
IS THAT DISPUTED? KATHLEEN NAPRSTEK CERISANO: I BELIEVE
THAT THE PENSION BOARD SAID THAT THEY TASH DASH REGARDLESS OF WHETHER OR NOT
SHE HAD -- YOU KNOW, THEY WOULD BASICALLY ACCEPT WHATEVER FACTS WE HAD SAID ABOUT
WHAT THE CLIENT HAD SAID, THAT SHE HAD GONE -- THE MEMBER HAD GONE TO HER
EMPLOYERS, SPOKEN TO HER EMPLOYER. THE BOARD OF TRUSTEES HAD SAID THAT SHE NEEDED
TO GO TO THE DIVISION OF PENSIONS CHT IT'S THE DIVISION OF PENSIONS THAT SHE
SHOULD OR HER EMPLOYER SHOULD HAVE -- JUSTICE FASCIALE: NO.
YOU'RE ASKING US TO EMPLOY PRINCIPLES OF EQUITY AND I AM TRYING TO LEARN WHETHER
BEFORE THE TWO YEARS EXPIRED, SOMEONE FROM THE BOARD OF EDUCATION, AN EMPLOYER
REPRESENTATIVE ASSURED YOUR CLIENT THAT, IN FACT, THE APPLICATION HAD BEEN FILED?
ARE YOU TELLING US THAT THAT HAPPENED? KATHLEEN
NAPRSTEK CERISANO: YES; THAT'S WHAT MY CLIENT HAS INFORMED ME.
JUSTICE FASCIALE: THE ONLY PART OF THE RECORD THAT WOULD SUPPORT THAT IS P-20 A.
IS THAT IT? KATHLEEN NAPRSTEK CERISANO: I AM
LOOKING BACK AT THAT. SHE DID NOT GET A LETTER. SHE SAID SHE WENT TO SPEAK
TO SOMEONE THERE. JUSTICE FASCIALE: IS THERE AN AFFIDAVIT FROM
HER THAT SAYS THAT? KATHLEEN NAPRSTEK CERISANO: NO, I DON'T.
JUSTICE FASCIALE: IS THERE AN AFFIDAVIT FROM THE PERSON, THE BOARD
OF EDUCATION THAT SAID THAT. KATHLEEN NAPRSTEK CERISANO: NO.
JUSTICE FASCIALE: FASH DID YOU ASK FOR A HEARING BEFORE AN ALJ TO FURTHER
ESTABLISH THAT YOUR CLIENT HAD BEEN INFORMED BEFORE THE TWO YEARS EXPIRED
THAT THE APPLICATION NOT ONLY WOULD BE FILED, BUT WAS FILED? THE.
DID YOU ASK FOR A HEARING? KATHLEEN NAPRSTEK CERISANO: YES, WE DID
ASK FOR A HEARING AND THE BOARD DENIED IT. THE BOARD SAID THAT
THEY WOULD TAKE THE FACTS WHICH WE HAD PRESENTED THEM WITH AND THAT IT DID
NOT MATTER -- THAT THE LAW DID NOT ALLOW THEM TO PROVIDE THIS SORT OF FLEXIBILITY
TO CHANGE ANYTHING BECAUSE THE DOCUMENT WAS NOT FILED WITHIN THE TWO-YEAR PERIOD OF
TIME AND THAT THEY HAD NO RECORD IN THEIR RECORDS AT THE DIVISION OF PENSIONS
THAT EITHER MS. SEAGO OR SOMEONE FROM THE BOARD OF EDUCATION HAD CONTACTED THEM
TO CONFIRM THIS. JUSTICE FASCIALE: SO.
JUSTICE SOLOMON: SO I TAKE IT -- I JUST HAVE TWO SIMPLE QUESTIONS. FROM WHAT YOU
SAY, I TAKE IT YOUR ARGUMENT IS THAT UNDER THE VERY SPECIFIC FACTS OF THIS
CASE, CABINING THE ISSUE TO THE FACTS OF THIS CASE, THE BOARD HAD THE AUTHORITY
TO GRANT EQUITABLE RELIEF TO YOUR CLIENT. KATHLEEN NAPRSTEK
CERISANO: YES. JUSTICE SOLOMON: THE BOARD'S POSITION WAS,
NO, WE DON'T. KATHLEEN NAPRSTEK CERISANO: CORRECT.
JUSTICE WAINER APTER: SO IF WE AGREED WITH YOU WHAT THAT THE BOARD ERRED WHEN
IT STATED THAT IT DID NOT HAVE THE AUTHORITY TO RELAX THE REGULATIONS, SHOULD
WE THEN REMAND THE MATTER BACK TO THE BOARD THAT THEY MAY IN FACT CONSIDER
THE EQUITIES AT STAKE INCLUDING ANY FISCAL IMPACT ON THE FUND, ON MS. SEAGO, PRACTICES
USED IN OTHER SCHOOL DISTRICTS, POTENTIAL EFFECTS ON OTHER FUND MEMBERS.
DO YOU AGREE THAT -- OR WHAT IS YOUR ANSWER TO THAT?
SHOULD WE REMAND FOR THE BOARD TO CONSIDER THE EK PITS IN THE FIRST INSTANCE?
KATHLEEN NAPRSTEK CERISANO: TWOFOLD. FIRST,
I AM ASKING THE COURT TO SEE UNDER THE CIRCUMSTANCES AS PRESENTED TO JUST GRANT
MY CLIENT'S REQUEST TO BE ALLOWED TO THE INTERFUND TRANSFER. IF
THE COURT HAS RESERVATIONS ABOUT THAT, THEN I CERTAINLY AM REQUESTING, AS WE
REQUESTED BEFORE THE TPAF BOARD THAT WE BE PERMITTED TO HAVE A HEARING TO HAVE
SOME OPPORTUNITY IN WHICH TO PRESENT ADDITIONAL EVIDENCE AND THAT THEY MUST CONSIDER
THE EMPLOYER'S ROLE IN THIS. WHAT THEY VERY SPECIFICALLY SAID,
VERY FIRMLY INDICATED WAS IT REALLY DOESN'T MATTER WHAT THE EMPLOYER'S
ROLE WAS IN THIS, THAT IT WAS THE EMPLOYEE'S OBLIGATION TO PURSUE THIS FURTHER.
JUSTICE WAINER APTER: I THINK I'M ASKING A DIFFERENT QUESTION.
IF WE WERE TO AGREE WITH YOU THAT THE BOARD ERRED IN STATING
THEY DID NOT HAVE THE AUTHORITY TO CONSIDER THE EQUITIES, COULD WE REMANDS FOR
THE BOARD TO CONSIDER THE EQUITIES IN THE FIRST INSTANCE OR ARE YOU SAYING
THAT THE BOARD WOULD NEED TO HAVE A HEARING FERS BEFORE IT COULD CONSIDER THE EQUITIES?
KATHLEEN NAPRSTEK CERISANO: YOU COULD REMAND BACK TO THE
BOARD. I DO KNOW THAT OFTENTIMES THE BOARD WILL SAY WELL, WE'VE JUST LOOKED AT
THESE EQUITIES. WE COULD SUBMIT IN ADDITIONAL DOCUMENTATION, SOME
ADDITIONAL HEARINGS. THIS PARTICULAR TPAF BOARD HEARING AT WHICH THIS MATTER WAS
CONSIDERED HAPPENED TO BE VERY EARLY IN THE COVID PERIOD OF TIME IN WHICH WHICH
WE WERE JUST DOING TELEPHONE CONFERENCES. IT MADE IT A LITTLE MORE DIFFICULT
SOMETIMES FOR THE QUESTIONING OF THE MEMBERS, THE TESTIMONY. OFTENTIMES WHEN YOU
FWOE TO A BOARD OF TRUSTEES MEETING FOR ONE OF THE PENSION BOARDS THE MEMBER
WILL BE THERE WITH ME AND THEY WILL PRESENT AND THEY WILL TESTIFY ABOUT VARIOUS
FACT. THE COURT: DID THE BOARD WAY THE EQUITIES IN THIS CASE
OR DID THEY SIMPLY SAY THEY COULDN'T DO IT BECAUSE THE TIME HAD EXPIRED?
KATHLEEN NAPRSTEK CERISANO: THEY MIGHT HAVE MADE A VERY QUICK STATEMENT THAT
THEY CONSIDERED THE EQUITIES. WHAT THEY SAID WAS IN THIS CASE THE EQUITIES DID
NOT SHOW THAT THE DIVISION OF PENSIONS HAD DONE ANYTHING WRONG AND ABSENT THE FACT
THAT THE DIVISION HAD DONE NOTHING WRONG, THEY HAD CONTACTED THE DIVISION AND
RECEIVED IMPROPER INFORMATION OR ANYTHING ABOUT THIS THAT IT WAS HEELLY --
ESSENTIALLY TASH DASH THAT WAS THEIR REVIEW AN THEY DENIED IT BECAUSE IT DID NOT
FALL WITHIN THE PARAMETERS -- JUSTICE PATTERSON: WHAT COMPETENT
EVIDENCE IS THERE ABOUT THE KEY POINT THAT YOU'RE MAKING IN SUPPORT OF YOUR
CLIENT'S CLAIM AND; THAT IS, THAT SHE WENT TO SOMEONE IN PAYROLL AN WAS ASSURED
THAT EVERYTHING HAD BEEN DONE AND THIS IS ALL WITHIN THE TWO-YEAR TIME PERIOD.
THAT SEEMS TO ME, CORRECT ME IF I'M WRONG, TO BE THE KEY FACT THAT YOU'RE BASING
YOUR CLAIM ON. KATHLEEN NAPRSTEK CERISANO: YES. IN THIS
CASE. THE INITIAL APPEAL, THE INITIAL REQUEST TO HAVE HER PENSION CREDIT
WAS THROUGH THE BUSINESS ADMINISTRATOR AND THEIR DEPARTMENT.
JUSTICE PATTERSON: NO, I GET THAT. WHAT I AM SAYING IS YOU'RE FOCUSING
ON AND WE'RE TALKING ABOUT DIFFERENTIATING THIS CASE FROM PERHAPS OTHERS
THAT HAVE DIFFERENT FACTS. YOU'RE FOCUSING ON HER GOING TO THE PAYROLL
DEPARTMENT AT THE BOARD OF EDUCATION, IF I'M UNDERSTANDING CORRECTLY WHAT
HAPPENED, AND RAISING THIS ISSUE BEING ASSURED IT WAS ALREADY DONE.
WHAT COMPETENT EVIDENCE IS THERE ABOUT THAT? KATHLEEN NAPRSTEK CERISANO:
I HAVE MY STATEMENTS FROM MY CLIENT, FROM THE MEMBER AND I KNOW I HAD SPOKEN
TO THE BUSINESS ADMINISTRATOR. HE IS NOW RETIRED, BUT I COULD CONTACT HIM.
JUSTICE PATTERSON: WHAT IS IN THE RECORD -- KATHLEEN NAPRSTEK
CERISANO: WE DID NOT BRING THE PERSON -- WE HAVE A STATEMENT FROM THAT
INDIVIDUAL. JUSTICE PATTERSON: WHAT DO YOU MEAN BY
STATEMENT? KATHLEEN NAPRSTEK CERISANO: I AM SAYING WE DID
NOT CONTACT, TRY TO REACH OUT TO THE PERSON WHO WAS NO LONGER WORKING THERE WHEN
THIS PAPER -- WHEN THE INTERFUND TRANSFER FORM WAS DISCOVERED BY THE NEW PERSON
IN -- WHO WAS WORKING THERE IN PAYROLL, SOMEBODY IN CHARGE OF PAYROLL AN
SHE WENT TO THE BA. WE DID NOT REACH OUT AN TRY TO CONTACT. I SPOKE TO MY CLIENT.
SHE TOLD ME SHE HAD SPOKEN TO SOMEONE, SHE HAD SPOKEN TO AN INDIVIDUAL.
WE DID NOT PURSUE THAT WHEN WE WENT BEFORE THE BOARD. I DID NOT GET AN AFFIDAVIT
FROM HER. I DID NOT TRY TO TRACK DOWN THE PERSON. WE WENT TO THE PENSION
BOARD HOPING THAT WE COULD CONVINCE THEM THAT UNDER THE CIRCUMSTANCES THEY SHOULD
PROCESS THE FORMS. YOU KNOW, WE WROTE OUR APPEALS THERE AND THEN IT WAS DENIED.
CHIEF JUSTICE RABNER: YOU POINTED TO 20 A IN THE APPENDIX.
CAN YOU TELL US WHAT THAT DOCUMENT IS? KATHLEEN
NAPRSTEK CERISANO: THAT WAS -- THE ONE DOCUMENT THAT I HAD WAS PAPERWORK THAT WAS
SENT TO -- THE STAMP THAT IT WAS SENT TO THE DIVISION OF PENSIONS BUT IT
WAS A HUMAN RESOURCE/PAYROLL ACTION NOTICE THAT WAS COMPLETED IN JULY OF 2017 BASICALLY
EXPLAINING OR PROCESSING SOME THINGS FOR MS. SEAGO WHEN SHE WAS GOING TO BE
ENROLLED INTO TPAF. IT JUST HAS THE NAME OF THE PERSON WHO WORKED IN PAYROLL.
THE COURT: IT DOESN'T DOCUMENT THE CONVERSATION THAT YOU
DESCRIBED. KATHLEEN NAPRSTEK CERISANO: NO IT DOES NOT.
JUSTICE PIERRE-LOUIS: THE EMPLOYER HERE ALSO SUBMITTED HER ENROLLMENT IN TPAF
IS THAT CORRECT. KATHLEEN NAPRSTEK CERISANO: YES.
JUSTICE PIERRE-LOUIS: SO AT THE SAME TIME YOUR CLIENT SUBMITTED THE PAPERWORK TO
HER EMPLOYER FOR THE INTERFUND TRANSFER SHE ALSO SUBMITTED THE TPAF ENROLLMENT
AN THE EMPLOYER IN THIS INSTANCE DID FORWARD THE TPAF ENROLLMENT BECAUSE SHORTLY
THEREAFTER IN 2017, SHE RECEIVED CERTIFICATION THAT SHE WAS ENROLLED IN TPAF
AND THOSE DEDUCTIONS BEGAN. KATHLEEN NAPRSTEK CERISANO: CORRECT.
THE INTERFUND TRANSFER FORM THAT SHE EXECUTED WAS IN JULY OF
2017 AND THAT IS A PAPER FORM. THEY ONLY USE -- THEY YOUTH PAPER FORMS.
THE ENROLLMENT APPLICATION IS NOW DONE THROUGH WHAT THEY CALL AN EP PICK ENROLLMENT
APPLICATION. I DON'T KNOW HOW LONG PENSIONS WOULD KNOW THAT, HOW LONG
THEY'VE BEEN DOING THAT BUT IT'S AN ELECTRONIC APPLICATION. IT'S NO LONGER A
PAPER APPLICATION. THAT WAS ACTUALLY SUBMITTED IN SEPTEMBER OF 2017.
JUSTICE PIERRE-LOUIS: BY THE EMPLOYER? KATHLEEN
NAPRSTEK CERISANO: BY THE MROIR, YES. THE EMPLOYER GOES ON LINE, THE CERTIFYING
OFFICER, I BELIEVE -- TO THE BEST OF MY KNOWLEDGE, ALL MY YEARS OF WORKING
WITH MEMBERS AND WORKING WITH THE DIVISION OF PENSIONS EVERY EMPLOYER, PUBLIC EMPLOYER
HAS SOMEONE WHO IS DESIGNATED A CERTIFIED OFFICER AND THEY ARE THE ONE THAT
FILES. JUSTICE PIERRE-LOUIS: SO BY OCTOBER OF 2017 YOUR CLOINT
WAS INFORMED THAT THE EMPLOYER HAD DONE WHAT THE EMPLOYER HAD INDICATED THEY WOULD
DO AND ENROLLED HER AND FORWARDED HER ENROLLMENT OR SUBMITTED HER ENROLLMENT
THROUGH TPAF. KATHLEEN NAPRSTEK CERISANO: THAT'S CORRECT.
JUSTICE PIERRE-LOUIS: SO IF SHE HAD FOLLOWED UP, IT PROBABLY WOULDN'T
HAVE BEEN UNREASONABLE TO BELIEVE THAT WAS TOLD TO HER THAT EVERYTHING HAD BEEN
TAKEN CARE OF BECAUSE SHE KNEW, AT LEAST, ONE PORTION OF HER ENROLLMENT
PROCESS HAD BEEN TAKEN CARE OF BECAUSE SHE WAS ALREADY ENROLLED IN TPAF.
KATHLEEN NAPRSTEK CERISANO: SHE STARTED TO HAVE DEDUCTIONS TAKEN OUT FOR TPAF;
THAT'S WHY WHEN SHE RECEIVED THAT OTHER LETTER IN MARCH THAT SAID NO
CONTRIBUTIONS WERE MADE TO YOUR PERS ACCOUNT SINCE JUNE OF 2017 AND SHE TALKED TO
THE EMPLOYER, SHE TOLD ME THAT THE EMPLOYER SAID, WELL, NO, BECAUSE YOU WEREN'T
MAKING CONTRIBUTIONS INTO PERS ANYMORE, YOU WERE MAKING KRBSZ INTO TPAF
AND SHE ASKED DID THE INTERFUND TRANSFER, DON'T WORRY. THIS IS WHAT SHE HAD CONVEYED
TO ME. JUSTICE MICHAEL NORIEGA: COUNSEL, IF THERE IS NO
EVIDENCE IN THE RECORD THAT WE CAN FIND THAT SUPPORTS THAT CONCLUSION THAT SHE
FOLLOWED UP OR THERE IS A CONVERSATION THAT'S CONFIRMED SOMEWHERE BY A
STATEMENT OR ANY CERTIFICATION, DO YOU STILL FEEL THAT TLGS ENOUGH FOR SUBSTANTIAL
COMPLIANCE BEFORE THAT POINT FOR YOUR CLIENT TO SUCCESS ON THIS COURT GRANTING
THE TRANSFER DIRECTLY CLOP SUCCEED CLOP. KATHLEEN NAPRSTEK
CERISANO: I WILL SO, BUT IF THE COURT FEELS THAT THEY NEED MORE INFORMATION, THEN
I AM REQUESTING THAT IT BE REMANDED BACK SO THAT WE CAN PUT TOGETHER AND
PRESENT THE REST OF THE INFORMATION, THE SUPPORTING EVIDENCE.
JUSTICE MICHAEL NORIEGA: CAN YOU TELL US WHAT FACTORS YOU WOULD RELY ON TO SAY
THAT YOU BELIEVE SO THAT THERE IS SUBSTANTIAL COMPLIANCE SHORT OF THAT
EVIDENCE? KATHLEEN NAPRSTEK CERISANO: WELL, THE EMPLOYER
ITSELF, THE BOARD OF -- THE BUSINESS ADMINISTRATOR HAD SUBMITTED A NUMBER OF, YOU
KNOW, OF DOCUMENTS EXPLAINING THAT THEY HAD, THEY HAD -- YOU KNOW, THEY HAD
TOLD -- WHEN THEY SUBMITTED THE INTERFUND TRANSFER FORM THAT THEY LOCATED IN THE
FILE THAT HAD NEVER BEEN FILE, THE BUSINESS ADMINISTRATOR SUBMITTED
ADDITIONAL CORRESPONDENCE AN DOCUMENTATION STATING THAT THIS IS -- THAT THEY WERE
SUPPOSED TO FILE THIS, THAT THEY HAD FAILED TO FILE IT, THAT THE CLIENT HAD, YOU
KNOW, BEEN TOLD BY HUMAN RESOURCES DEPARTMENT THAT THIS IS WHAT SHE HAD
TO DO AND SHE DIDN'T HAVE TO DO ANYTHING MORE. JUSTICE SOLOMON:
THAT'S PART OF THE RECORD? THOSE DOCUMENTS YOU'RE NOW REFERRING
TO ARE PARTED OF THE RECORD? KATHLEEN NAPRSTEK CERISANO:
THOSE DOCUMENTS WERE BEFORE THE APPELLATE COURT, YES. JUSTICE
SOLOMON: WERE THEY BEFORE THE BOARD? KATHLEEN NAPRSTEK CERISANO:
YES, THEY WERE BEFORE THE BOARD. JUSTICE SOLOMON: SO WHERE
ARE THEY IN THE APPENDIX? KATHLEEN NAPRSTEK CERISANO: IN
THE APPENDIX, THEY ARE AT 30 A, I THINK IT'S MAYBE MULTIPLE.
JUSTICE WAINER APTER: THAT'S ALSO 19 AND 24 WHERE IT SAYS PLEASE ACCEPT THIS AS
A LETTER OF REQUEST FOR INTERFUND TRANSFER, QUOTE, THE JOER SIGHT WAS NOT
THE EMPLOYEE'S FAULT? IS THAT WHAT YOU'RE REFERRING TO, PERHAPS?
KATHLEEN NAPRSTEK CERISANO: WHICH NUMBER? I'M
SORRY. JUSTICE WAINER APTER: 19 AND 24. KATHLEEN
NAPRSTEK CERISANO: THERE IS A SUBSEQUENT LETTER. JUSTICE
PIERRE-LOUIS: I KNOW YOU REFERRED TO 30 AND IT'S A LETTER IN WHICH THE EDISON
TOWNSHIP BOARD OF ED INDICATES THAT SHE CLAIMS SHE WAS TOLD BY OUR HUMAN
RESOURCES DEPARTMENT THAT WHEN SHE BECAME A TEACHER SHE DID NOT HAVE TO DO ANYTHING
TO TRANSFER HER TIME EXCEPT FILL OUT HER PORTION WE DO NOT DOUBT THAT SHE WAS
TOLD THIS BECAUSE AT THE TIME THAT'S ALL SHE NEEDED TO DO. KATHLEEN
NAPRSTEK CERISANO: YES. JUSTICE SOLOMON: THESE ITEMS OF EVIDENCE
WERE SUBMITTED TO THE BOARD AFTER THE TWO YEARS HAD EXPIRED, RIGHT?
KATHLEEN NAPRSTEK CERISANO: THAT'S CORRECT. JUSTICE
SOLOMON: BUT THEY WERE EVIDENCE THAT SOMETHING HAD HAPPENED WITHIN THE TWO YEARS?
KATHLEEN NAPRSTEK CERISANO: YES. CHIEF JUSTICE
RABNER: COUNSEL, WE UNDERSTAND YOUR POSITION, YOU WANT A STATEMENT THAT THE
BOARD HAS THE AUTHORITY TO GRANT THE RELIEF HERE AND THAT EITHER THE COURT THROUGH
ITS REVIEW OF THE RECORD GRANT THAT RELIEF OR SEND IT BACK FOR A HEARING AN THE
CONSIDERATION OF THE EQUITIES HERE? KATHLEEN NAPRSTEK CERISANO:
THAT'S CORRECT. THE COURT: OTHER QUESTIONS ANYONE?
COUNSEL ANYTHING YOU WOULD LIKE TO ADD. KATHLEEN NAPRSTEK CERISANO:
NO JOSEPH A. PALUMBO: CHIEF JUSTICE, JUSTICES, MAY IT PLEASE THE COURT, UNDER
THE CIRCUMSTANCES THE BOARD REASONABLY DENIED SEAGO'S REQUEST TOLLY TRANSFERS SEE GO'S
APPLICATION TO TRANSFER HER PERCENT MEMBERSHIP WAS FILED OVER TWO YEARS AFTER SHE FINISHED
HER PERS MEMBERSHIP, HER PERCENT MEMBERSHIP HAD OVER A YEAR TRANSPIRED AND THEREFORE WAS
INELIGIBLE TO TRANSFER. SPECIFICALLY THE EXPRESS STATUTORY LIMITATION THAT MEMBERSHIP
IN PERS CEASES TWO YEARS AFTER MEMBERSHIP HAS CONTINUED, AND THE REGULATORY THAT MEMBERSHIP
CAN ONLY BE TRANSFERRED IF IT IS NOT EXPIRED, THE INTERFUND TRANSFER NECESSARILY INVOLVES
THE CONTINUATION OF PUBLIC EMPLOYEE. NATURAL 42:15 A-7 AND 41 ARE PERS SPECIFIC STATUTE,
THEY REFER TO THE PERS RETIREMENT SYSTEM AND TO PERS ELIGIBLE EMPLOYMENT. NEFRMS, SEE
GO ARGUES THAT THE APPELLATE DIVISION AND THE BOARD WERE TOO STRINGENT AND INFLEXIBLE
IN THEIR APPLICATION OF THE RULE AND SHE SEEKS TO EVADE THE LEGISLATIVE LIMITATION AND
THE REGULATORY RESTRICTION ARGUING THAT AN ADMINISTRATIVE HEARING WAS NECESSARY TO
DETERMINE WHETHER GOOD CAUSE EXISTED, BUT THE BOARD ACCEPTED THE TRUTH OF SEE GO'S
ALLEGATIONS, SO THERE WERE NO, BASED ON THE UNDISPUTED FACTS THE BOARD WAS NOT ARBITRARY
CAPRICIOUS OR UNREASONABLE IN REJECTING THE ARGUMENT. WHILE THE BOARD HAS INHERENT
EQUITABLE AUTHORITY IT WAS REASONABLE FOR THE BOARD TO DENY THE REQUEST TO OECH HER
MEMBERSHIP AND GRANTOR THE UNTIMELY REQUEST UNDER THE STATUTE AND RELEVANT CASE LAW. FOR
EXAMPLE, THE BOARD CAN USE ITS AUTHORITY TO OPEN RETIREMENT SELECTION AFTER IT IS DEEMED
PAYABLE ON A SHOWING OF GOOD CAUSE, REASONABLE GROUFRNDZ AND REASONABLE DILIGENCE, THOSE
CASES LIKE DUE BIN DEAL WITH ADDRESSING ORDERS ENTERED BY THE DIVISION, NOT STATUTORY
OR REGULATORY, AND THEY TYPICALLY CENTER ON. IN SAVAGE, THE MEMBER LACKED
CAPACITY TO CHANGE HIS SELECTION DURING THE 30 DAY DEEMED PAYABLE PERIOD. THE OTHER CASE
THAT SEE GO RELIES UPON IS DISTINGUISHABLE. IN ZIGMONT THE STATUTE OF LIMITATIONS WAS
AMBIGUOUS SO THE BOARD CONSIDERED IT IN EXERCISING ITS SDREK TO WAIVE THE RULE, UNDER
THE CIRCUMSTANCES HERE THE BOARD WAS NOT UNREASONABLE IN REJECTING THE ARGUMENTS, THIS
COURT SHOULD AFFIRM THE APPELLATE DIVISION DECISION. THAT CONCLUDES MY OPENING
STATEMENT. CHIEF JUSTICE RABNER: SO, COUNSEL, YOU SAID THERE WERE NO DISPUTED
FACTS AND THAT WAS THE REASON THERE WAS NO NEED FOR A HEARING, IS THERE A DISPUTE THAT
AFTER MISS SEEING SEAGO GOT THE MARCH 15 LETTER SAYING WE'RE NOT DONE HERE YET, THAT SHE
WENT TO HER EMPLOYER AND THE EMPLOYER HE KNOW INSURED HER THAT IT WOULD BE FILED.
JOSEPH A. PALUMBO: THE BOARD ACCEPTED THAT AS TRUE, YOUR HONOR. CHIEF JUSTICE
RABNER: THEN TELL US WHAT'S WRONG WITH THE POSITION BEING ADVANCED HERE, AN EMPLOYEE
PROVIDES ALL THE PAPERWORK THAT THE EMPLOYEE HERSELF CAN AND GETS A PROMISE AFTER GOING
BACK TO THE EMPLOYER THAT THE BALANCE WILL BE SUBMITTED IN A TIMELY WAY. WHAT IS WRONG
WITH THE POSITION THAT THE BOARD HAS DISCRETION UNDER THOSE CIRCUMSTANCES TO GRANT RELIEF?
JOSEPH A. PALUMBO: WELL, IT IS ULTIMATELY THE MEMBER'S RESPONSIBILITIES
TO FILE THE FORM, IT'S A VOLUNTARY TRANSACTION. CHIEF JUSTICE RABNER: SO
WHAT ELSE SHOULD A REASONABLE EMPLOYEE DO UNDER THOSE CIRCUMSTANCES. JOSEPH A.
PALUMBO: WELL, WITH THAT LETTER IN HAND THAT SHOWED THAT SHE STILL HAD A YEAR AND EIGHT
MONTHS LATER SHE STILL HAD AN OPEN PERS MEMBERSHIP AND SHE STILL WAS ELIGIBLE FOR A
PERS DEFERRED RETIREMENT BENEFIT, NEITHER OF WHICH WOULD BE TRUE IF HER ACCOUNT HAD TRANSFERRED,
SHE SHOULD HAVE AT LEAST REACHED OUT TO THE DIVISION. IF THE THE DIVISION HAD NO IDEA
THAT A MEMBER IS TRYING AN INTERFUND TRANGSZ FER UNTIL THEY GET AN APPLICATION BECAUSE
IT'S VOLUNTARY, IT'S THE NO THE SAME AS AN ENROLLMENT WHICH IS MANDATORY AND THAT IS THE
RESPONSIBILITY OF THE EMPLOYER TO FILE. CHIEF JUSTICE RABNER: BUT SHE DIDN'T
SIT AND DO NOTHING, SHE WENT TO THE CRUX OF THE PROBLEM THAT EDISON HADN'T COMPLETED THEIR
ROLE IN ALL OF THIS. WHY WAS THAT NOT ENOUGH? JOSEPH A. PALUMBO: EDISON
WAS THE CAUSE OF THE PROBLEM, THEY HAD ALREADY ASSURED HER THAT THEY WOULD TAKE CARE OF
IT, SHE GETS THIS LETTER SHOWING THAT THEY HADN'T DONE IT, AND THEN SHE GOES BACK TO THEM.
JUSTICE NORIEGA: HAVE LETTER DIDN'T SUGGEST THAT THEY HADN'T DONE IT YET,
JUST THE ACCOUNT HADN'T TRIGGERED YET. JOSEPH A. PALUMBO: WELL, IF THEY HAD
DONE IT, IT WOULD HAVE TRANSFERRED. JUSTICE WAINER APTER: BUT EVEN THE LETTER
DOESN'T STAY JUST SO YOU KNOW YOUR ACCOUNT DIDN'T TRANSFER. JOSEPH A. PALUMBO:
THE DIVISION DIDN'T KNOW THAT, THEY ONLY KNOW THAT THERE'S AN OPEN PERS ACCOUNT.
JUSTICE NORIEGA: THERE'S A LEAP THAT YOU'RE ASKING HER TO MAKE THAT SHE UNDERSTAND HOW
THE SYSTEM WORKS, THE FACT THAT IT MEANS THAT THE TRANSFER WASN'T MADE TO FACH FAVP YET.
CHIEF JUSTICE RABNER: I WANT TO FOLLOW-UP ON THIS, HAD SLE CONTACTED THE
DIVISION DIRECTLY AND SAID LISTEN I WENT TO EDISON, THEY HAVEN'T FINISHED THE PAPERWORK,
WE'RE PROCEEDING AT PACE, WOULD THAT HAVE CREATED A SITUATION WHERE SHE WOULD BE ENTITLED
TO RELIEF. JOSEPH A. PALUMBO: IT CERTAINLY WOULD GO TOWARDS IT, WE DON'T
KNOW WHAT WOULD HAVE HAPPENED -- CHIEF JUSTICE RABNER: WOULD THE BOARD HAVE
HAD THE AUTHORITY TO GRANT RELIEF UNDER THOSE CIRCUMSTANCES. JOSEPH A.
PALUMBO: YES, THEY COULD HAVE. CHIEF JUSTICE RABNER: SO BECAUSE THEY
WEREN'T GIVEN A COURTESY HEADS UP 24 EDISON HAD NOT YET SUCCEEDED IN WHAT IT WAS SUPPOSED
TO DO, IT DOESN'T HAVE AUTHORITY, BUT HAD THEY KNOWN ABOUT THAT AND DONE NOTHING ELSE,
THEY WOULD HAVE HAD THE AUTHORITY. JOSEPH A. PALUMBO: THEY HAD THE AUTHORITY
IT'S JUST THAT THEY DIDN'T FEEL IT WAS WARRANTED WITH THE CIRCUMSTANCES PRESENTED.
CHIEF JUSTICE RABNER: SO THEY HAD THE AUTHORITY IN THIS CASE, ARE YOU CONCEDING THAT
POINT. JOSEPH A. PALUMBO: YES, YOUR HONOR. JUSTICE WAINER APTER:
HOW DO WE UNDERSTAND THAT FROM THE BOARD'S OWN DECISION WHERE IT LOOKS LIKE AT P.A. 36
THE BOARD STATED THAT IT "HAS NO AUTHORITY TO GRANT MISS SEAGO'S REQUEST IN KORNGS WITH
NAVRP 4315 A-7 AND NJAC 173-7.1, HOW DO WE UNDERSTAND FROM THAT THAT THE BOARD
RECOGNIZED THAT IT HAD THE AUTHORITY BUT IT WAS JUST CHOOSING NOT TO EXERCISE IT UNDER
THE CIRCUMSTANCES BECAUSE IT DID NOT BELIEVE THAT THE THE EQUITABLE CIRCUMSTANCES JUSTIFIED
IT. JOSEPH A. PALUMBO: SO THAT LETTER WAS THE INITIAL DECISION OF THE BOARD,
THEN MISS SEAGO APPEALED THAT INITIAL DECISION AND THE BOARD ISSUED A FINAL AGENCY DECISION
AND IN THAT DECISION, IT'S CLEARLY THEY CONSIDERED THE CIRCUMSTANCES HERE BECAUSE
THEY ADDRESSED THEM ALL. THE WITNESS: JUSTICE WAINER APTER:
SO WHERE DID THEY SAY WE HAVE AUTHORITY TO GRANT YOUR REQUEST BUT WE'RE DHOOFG NOT TO DO SO
IN LIGHT OF THE CIRCUMSTANCES, WHERE DO THEY ACKNOWLEDGE THAT THEY DO HAVE THE AUTHORITY
RELAX THE REGULATIONS. JOSEPH A. PALUMBO: THEY DON'T EXPRESSLY SAY THAT
BUT THERE WOULD BE NO POINT TO GO THROUGH EACH OF MISS SEAGO'S ALLEGATIONS IF FOR EXAMPLE
IF THEY FELT THEY HAD NO AUTHORITY WHATSOEVER THERE WOULD BE NO REASON TO GO THROUGH HER
-- THE REASONS THAT SHE GAVE HER FILING IT UNTIMELY, THEY COULD HAVE JUST SAID WE DIDN'T
RECEIVE IT WITHIN THE TWO YEARS, YOU'RE OUT OF TIME, THERE'S NOTHING WE CAN DO.
JUSTICE SOLOMON: IS THAT WHAT YOU TOLD THE APPELLATE DIVISION. JOSEPH A.
PALUMBO: NO, WE DID ARGUE EQUITIES IN THE APPELLATE DIVISION S AND DIDN'T THE APPELLATE
DIVISION SAY THAT THE BOARD HAD NO AUTHORITY. JOSEPH A. PALUMBO: THE APPELLATE
DIVISION DIDN'T SAY THAT THE BHOORD HAD NO AUTHORITY. A. DIDN'T HAVE THE AUTHORITY
IN THIS CASE. JOSEPH A. PALUMBO: IN THIS CASE BASED ON THE CIRCUMSTANCES
AND IT'S CASE LAW THAT'S. JUSTICE SOLOMON: BUT YOU ALREADY ADMITTED THAT
THEY DID HAVE THE AUTHORITY, THEY JUST DECIDED THAT THE EQUITIES DIDN'T SUFFICIENTLY WAY
IN FAVOR OF THE PLAINTIFF. JOSEPH A. PALUMBO: THIS COURT HAS SAID THAT
THE BOARD HAD INHERENT EQUITABLE POWER. JUSTICE WAINER APTER: YOU HAD REFERRED
TO THE STATUTES AND REGULATIONS INTERCHANGEABLY, I WANT TO BE MORE SPECIFIC, WHAT SPECIFIC
PARTS OF THE STATUTE ARE YOU REFERRING TO, I'M LOOKING AT N.J.S.A. 18 A:66-15.1 WHERE
IT SAYS A MEMBER WHO IS A MEMBER OF THE AND THEN IT'S PERS AT THE TIME OF ENROLLMENT IN
T FACH AND WHO IN 3 YEARS SEIZES TO BE AN ACTIVE MEMBER IN POIRS MAY. (READING.
CONTRIBUTIONS FROM POIRS TO TPAF, WHERE DO WE SEE IN THAT WHERE SPEVENTHSDLY IT'S TACKING
BECAUSE 2 YEARS, THAT THERE'S A 2 YOOER LIMITATION FOR TRANSFER. JOSEPH
A. PALUMBO: PRIOR TO THAT STATUTE YOU WEREN'T ALLOWED, THE MEMBERS WEREN'T A LOUDER TO
TRANSFER THEIR MEMBERSHIP IN ONE SYSTEM TO ANOTHER, SO THIS GRANTHS THEM THE POWER TO BE
ABLE TO DO THAT, GIVE THEM THE #07GS. IT DOESN'T SPECIFY A TIECHL LINE IN THERE, BUT
THE TIMELINE COMES FROM THE OTHER STATUTE WHERE IT'S CLEAR THAT MEMBERSHIP CEASES TWO
YEARS AFTER YOU DISCONTINUE SERVICE IN PERS, ONCE YOUR MEMBERSHIP CEASES YOU NO LONGER
HAVE THE RIGHTS AND PRIVILEGES TO EXERCISE THESE OPTIONS. JUSTICE WAINER APTER:
HOW WOULD YOU KNOW THAT FROM THE STATUTE, WHERE IN THE STATUTE DOES IT SAY THAT.
JOSEPH A. PALUMBO: IT DOESN'T SAY -- 43:15 A-7 AND 43 COLON 15 A-21 IT MAKES IT CLEAR
THAT THE MEMBERSHIP CEASES AFTER 3 YEARS, AND AFTER THE MEMBERSHIP CEASES, YOU DON'T HAVE
THE RIGHTS AND PRIVILEGES OF BEING A MEMBER ANY MORE. JUSTICE WAINER APTER:
WHAT ABOUT IN THE REGULATION WHERE IT MAKES IT SEEM LIKE YOU CAN CONTINUE TO MAKE A TRANSFER
AS LONG AS YOUR MEMBERSHIP WAS NOT VESTED, SO I'M LOOKING AT NJAC 17:3-7.1 B 53 I THINK.
JOSEPH A. PALUMBO: CORRECT, I KNOW EXACTLY WHAT YOU'RE TALKING ABOUT.
JUSTICE WAINER APTER: SO WHAT DOES THAT MEAN, WHERE IT SAYS SPECIFICALLY MEMBERS MAY
NOT COMPLETE SUCH A TRANSFER AND IT'S REFERRING TO FROM POIRS TO TPAF IF "THE ACCOUNT
HAS TRANSFERRED, IT HAS BEEN TWO YEARS FROM THE DATE OF THE LAST CONTRIBUTION AND THE
MEMBER IS NOT VESTED. JOSEPH A. PALUMBO: 3 GOES TO A VERY PARTICULAR
CIRCUMSTANCE. SO THE GENERAL RULE INDEED IS THAT ONCE YOUR MEMBERSHIP EXPIRES YOU CAN'T
TRANSFER IT. B I I I IS ADDRESSING A PARTICULAR CIRCUMSTANCE WHERE YOU'RE STILL A MEMBER
BUT THE ACCOUNT IS EXPIRED. THAT CAN HAPPEN IF SAY A TEACHER WORKS FOR TWO YEARS, A YEAR
OR TWO, THEN THEY LEAVE FOR TWO YEARS, THAT ACCOUNT WOULD NOT EXPIRE AND THEN THEY GET
REHIRED AS A TEACHER, THEY'RE A MEMBER AGAIN, SO THEY'RE A MEMBER OF TPAF BUT THEIR ACCOUNT
HAS EXPIRED, THAT PRIOR ACCOUNT, THEY HAVE A NEW ACCOUNT, IN THAT SITUATION YOU CAN'T
INTERFUND TRANSFER, TECHNICALLY YOU'RE AN ACTIVE MEMBER OF TPAF, BUT YOU CAN'T TRANSFERRED
THAT OLD TPAF ACCOUNT TO YOUR NEW TPAF ACCOUNT. JUSTICE WAINER APTER: I'M
SORRY, SAY THAT AGAIN, WHERE IT SAYS IF THE ACCOUNT MASS NOT EXPIRED AND THE MEMBER IS
NOT VESTED. JOSEPH A. PALUMBO: BEFORE IT GETS TO WHERE IT SAYS THE ACCOUNT,
IT SAYS A MEMBER, SO IT'S ASSUMING YOU'RE ALREADY A MEMBER OF TPAF BUT YOUR ACCOUNT HAS
EXPIRED. JUSTICE WAINER APTER: WHAT ACTUALLY IS VESTING, WHY DOES IT SAY
AND THE MEMBER IS NOT VESTED, IF IT DOESN'T HE MATTER ONE WAY OR THE OTHER IF THE MEMBER
IS VESTED. JOSEPH A. PALUMBO: I'M NOT SURE, WE NEVER BRIEFED WHY THAT COMES
INTO PLAY, BUT I I I IS JUST IRRELEVANT IN THIS SITUATION. JUSTICE WAINER APTER:
SO YOU AGREE HERE SHE WAS VESTED, BECAUSE YOU VIOLENT CRIME ASSESSMENT AFTER 10 YEARS,
CORRECT, AND SHE HAD MORE THAN 10 YEARS IN PERS, SO SHE WAS VESTED. JOSEPH A.
PALUMBO: YES, HER PERS DEFERRED RETIREMENT WAS VOIFT R VESTED. CHIEF JUSTICE
RABNER: YOU TOLD US THE DIVISION HAD AUTHORITY TO GRANT RELIEF HERE AND I WANT TO ASK
YOU ABOUT THE PRINCIPLES OUTLINED BY THE APPELLATE DIVISION IN SELLERS, WHERE THE
COURT SAID THAT THE BOARD CAN APPLY OIRNL PRINCIPLES WHEN JUSTICE DEMANDS IF IT'S DONE
RARELY AND SPARINGLY AND IT WILL NOT HARM THE PENSION SYSTEM, AND THEN THE APP. DIV. WENT
ON TO IDENTIFY A NUMBER OF CONSIDERATION, DID THE EMPLOYEE ACT IN GOOD FAITH, WHAT'S THE
DEGREE OF HARM HERE THAT WOULD SUSTAINED BY THE EMPLOYEE, WHAT'S THE PURPOSE OF RESTRICTION,
IS THAT A SENSIBLE APPROACH TO TRY TO RESOLVE THESE SORTS OF ISSUES. JOSEPH A.
PALUMBO: I BELIEVE SO, YOUR HONOR. CHIEF JUSTICE RABNER: SO THEN TELL US
WHY IT IS THAT THE BOARD'S DECISION IS APPROPRIATE IN LIGHT OF THESE CONSIDERATIONS?
DID THE EMPLOYEE HERE ACT IN GOOD FAITH? JOSEPH A. PALUMBO: SHE DID ACT
IN GOOD FAITH, BUT SHE DIDN'T HAVE GOOD CAUSE AND IT WASN'T DUE DILIGENCE BECAUSE ULTIMATELY
HER RESPONSIBILITY TO FILE THIS FORM. CHIEF JUSTICE RABNER: DID THE GOVERNMENT
LOOKING AT WHAT HAPPENED WITH EDISON TURN SQUARE COURT AND JURIES HERE. JOSEPH A.
PALUMBO: THAT'S EDISON, THE DIVISION AND THE BOARD CERTAINLY TURNED SQUARE CORNERS HERE,
THE DIVISION HAD NO IDEA THAT MISS SEAGO WAS TRYING TO DO AN INTERFUND TRANSFER, THEY
DIDN'T GIVE HER ANY MISREPRESENTATION WHATSOEVER. CHIEF JUSTICE RABNER:
SO IS IT OR IS IT NOT APPROPRIATE TO CONSIDER EDISON'S FAILURE TO ACT APPROPRIATELY HERE?
WHEN WE CONSIDER WHETHER THE GOVERNMENT TURNED SQUARE CORNERS. JOSEPH A.
PALUMBO: I DON'T BELIEVE SO, YOUR HONOR. CHIEF JUSTICE RABNER: DEGREE OF
HARM, DOES THE BOARD DISPUTE THAT MISS SEAGO HAS SUFFERED HARM HERE. JOSEPH A.
PALUMBO: SHE CERTAINLY DOES, BUT THERE'S NO FORFEITURE, SHE STILL IS ENTITLED TO RECEIVE
HER POIRS TIER 1 RETIREMENT BENEFIT AND SHE WILL RECEIVE A TPAF SERVICE RETIREMENT UPON
RETIREMENT FROM THE TPAF. CHIEF JUSTICE RABNER: LET ME ASK YOU THE QUESTION
THAT SOME OF US ASKED YOUR COLLEAGUE ON THE OTHER SIDE. IF YOU ARE NOT TO PREVAIL, WHAT WOULD
NARROW GROUNDS BE TO OVERTURN THE RULING OF THE APPELLATE DIVISION HERE AND YET NOT CREATE
CHALLENGES TO THE INTEGRITY OF THE FUND? JOSEPH A. PALUMBO: THAT'S A GOOD
QUESTION, YOUR HONOR. CHIEF JUSTICE RABNER: I'M NOT ASKING YOU TO FOR SAKE YOUR
ARGUMENT, I UNDERSTAND YOUR POSITION IS THAT WE SHOULD AFFIRM. JOSEPH A.
PALUMBO: YES, ABSOLUTELY. IT'S DIFFICULT BECAUSE WITHOUT THE DIVISION KNOWING THAT A
MEMBER IS TRYING TO APPLY FOR THIS, THEY, IN ORDER TO ADMINISTER THE FUND, THAT ACCOUNT
CEASES AND NOW IT'S DONE, IT'S LOCKED IN, AND IF WE ALLOW EMPLOYERS TO HOLD ON TO THESE
FORMS AND SEND THEM IN BY YEAR AFTER, TWO YEARS AFTER, 5 YEARS AFTER, IT ESSENTIALLY KEEPS
THAT ACCOUNT OPEN INDEFINITELY. JUSTICE NORIEGA: COUNSEL, ARE YOU AWARE
OF WHETHER OR NOT THE BOARD HAS MADE ANY EFFORTS TO CHECK WITH OTHER JURISDICTIONS WHETHER OR
NOT THEY HAVE REGULATIONS IN PLACE THAT WOULD CAUSE THE SAME EXACT PROBLEM?
JOSEPH A. PALUMBO: YOU MEAN OUTSIDE OF NEW JERSEY? JUSTICE NORIEGA: NO,
OUTSIDE OF EDISON. JOSEPH A. PALUMBO: OH, NO. ARE YOU TALKING ABOUT THE
FACT THAT EDISON IT'S THEIR POLICY TO COMPLETE THIS FORM? JUSTICE NORIEGA:
RIGHT, THAT'S AN ISSUE IN TERMS OF WHAT WAS TOLD TO THE EMPLOYEE THROUGH THE REGULATIONS
IN THAT SPECIFIC PLACE. HAS THERE BEEN ANY EFFORT TO FERRET OUT WHETHER THIS IS
HAPPENING ELSEWHERE IN THE STATE. JOSEPH A. PALUMBO: NO. NOT THAT I'M AWARE
OF. I KNOW THAT THE BOARD AND THE DIVISION DO LOOK INTO WAYS TO TRY TO AMELIORATE THE
SITUATION, BUT I DON'T THINK THEY REACH OUT TO MUNICIPALITIES TO SEE WHAT -- I DO KNOW
THAT MOST EMPLOYERS WILL HELP OUT THE EMPLOYEE TO FILL OUT THE FORM AND SENDS IT IN BUT
ULTIMATELY IT IS THE EMPLOYEE'S RESPONSIBILITY AND GOING BACK TO A QUESTION BUT I CAN'T
REMEMBER WHICH JUSTICE ASKED IT, THE EMPLOYEE CAN CERTAINLY GO TO THE EMPLOYER, HAVE THEM
FILL OUT THEIR SECTION AND SEND IT INTO THE DIVISION IF THEY WANT. JUSTICE
WAINER APTER: YOU JUST CONCEDED THAT MOST EMPLOYERS SEND IN THE FORM ON BEHALF OF THE
EMPLOYEE, CORRECT. JOSEPH A. PALUMBO: THAT'S CORRECT, THEY DO.
JUSTICE WAINER APTER: AND HAVE YOU MADE ANY CHANGES, I'M LOOKING AT PAGE 24 WHICH I
BELIEVE IS THE ACTUAL FORM, IT SAYS APPLICATION FOR INTERFUND TRANSFER AND IT SAYS THIS
APPLICATION MUST BE COMPLETED BY YOU AND YOUR FORMER EMPLOYER, AND THERE'S APART 1 AND
APART 2, AND THE PART 2 SPECIFICALLY SAYS CERTIFICATION OF FORMER EMPLOYING AGENCY.
HAVE ANY CHANGES TO THAT FORM BEEN MADE SO THAT IT IS KWLEER THAT IT IS THE EMPLOYEE AND NOT
THE EMPLOYER'S RESPONSIBILITY TO SEND IT IN? JOSEPH A. PALUMBO: I'M NOT
AWARE OF ANY CHANGES TO THE FORM. JUSTICE SOLOMON: YOU EXPLAINED SOME OF THE
ADMINISTRATIVE PROBLEMS, THE CHIEF ASKED YOU A QUESTION ABOUT THE IMPACT OF THE SYSTEM.
YOU EXPLAINED SOME OF THE ADMINISTRATIVE PROBLEMS IF AN ACCOUNT IS OPENED OR KEPT OPENED
OR YOU DON'T KNOW THAT IT'S CLOSED. AS I UNDERSTAND IT, AFTER -- THERE WERE NO
CONTRIBUTIONS IN THIS CASE MADE TO THE PERS ACCOUNT. PERS ACCOUNT. AFTER A CERTAIN
POINT IN TIME, AND CONTRIBUTIONS WERE BEING MADE TO THE TPAF ACCOUNT AFTER THAT POINT IN
TIME, SO THE FUNDS WERE THERE IN THE PENSION. CORRECT? JOSEPH A. PALUMBO:
CORRECT. BUT THEY'RE FUNDS IN TWO SEPARATE -- JUSTICE SOLOMON: I UNDERSTAND.
THERE'S AN AD TRAF PROBLEM YOU'RE SUGGESTING BECAUSE YOU DON'T KNOW THAT THIS ONE IS
CLOSED, EVEN THOUGH IT HAS BEEN CLOSED AFTER TWO YEARS, AND YOU DON'T KNOW THIS ONE HAS BEEN
OPENED EVEN THOUGH THE MONEY IS GO BEING INTO THE FUND. JOSEPH A. PALUMBO:
WE KNOW THAT TPAF IS OPEN. JUSTICE SOLOMON: OKAY, AND MONEY IS GOING IN THERE.
JOSEPH A. PALUMBO: CORRECT. JUSTICE SOLOMON: SO WOULD YOU PLEASE,
THE CHIEF'S QUESTION I THINK WAS, OR MAYBE NOT, I'LL ASK IT, OTHER THAN THE ADMINISTRATIVE
PROBLEM OF HAVING A CLOSED ACCOUNT THAT'S STILL REGISTERED WITH YOU AND AN OPEN ACCOUNT
THAT'S NOT, WHAT IS THE DANGER OR RISK TO THE FIRM, TO THE PENSION? JOSEPH A.
PALUMBO: IT'S NOT JUST THE CONTRIBUTIONS AND HER SERVICE CREDIT THAT TRANSFER, IT'S ALSO
THE LIABILITIES THAT ATTACH TO THAT RETIREMENT BENEFIT THAT SUDDENLY TRANSFER --
JUSTICE SOLOMON: LIKE WHAT. JOSEPH A. PALUMBO: THE RETIREMENT BENEFIT
THAT SHE WILL GET. JUSTICE SOLOMON: SHE'S PAYING INTO IT. JOSEPH A.
PALUMBO: IN HER TPAF ACCOUNT BUT RIGHT NOW IT'S A CLOSED PERS ACCOUNT, SET, IT'S DEAD,
IT'S -- AFTER 13 YEARS AND SUDDENLY IT BECOMES A TIER 1 -- JUSTICE SOLOMON:
SO SHE MIGHT BE CLAIMING I GUESS OR COULD CLAIM POIRS BENEFITS ON THAT CLOSED ACCOUNT
WHILE ALSO HAVE ENTITLEMENT UNDER TPAF BECAUSE SHE'S BEEN CONTRIBUTING TO THAT ACCOUNT.
JUSTICE WAINER APTER: I THOUGHT YOU SAID THAT'S WHAT WOULD HAPPEN IF IT
DIDN'T TRANSFER, SHE COULD STILL GET THE PERS BENEFIT, THERE'S ACTUALLY NO FORFEITURE
OF THE PERS. JOSEPH A. PALUMBO: THAT'S CORRECT. JUSTICE SOLOMON:
THAT'S NOT WHAT I'M ASKING. SO YOUR CONCERN IS THAT SHE WOULD HAVE ENTITLEMENT TO THE
PERS WHILE SHE WAS STILL CONTRIBUTING TO TPAF. CORRECT? JOSEPH A. PALUMBO:
NO, THE CONCERN IS THAT TPAF WILL NOT HAVE TO PAY THE LIABILITY ON HER RETIREMENT BENEFIT
WHEREAS BEFORE IT WAS -- JUSTICE SOLOMON: LIABILITY OF WHICH RETIREMENT
BENEFIT. JOSEPH A. PALUMBO: IF THE PERS RETIREMENT, IF THE PERS MEMBERSHIP
IS TRANSFERRED TO TPAF -- JUSTICE SOLOMON: I'M NOT SAYING IT'S TRANSFERRED.
JOSEPH A. PALUMBO: IF IT'S NOT TRANSFERRED THEN PERS WILL PAY HER PERS
RETIREMENT AND TPAF WILL PAY HER TPAF RETIREMENT. JUSTICE SOLOMON: OKAY,
SHE'S MADE ALL THE CONTRIBUTIONS SHE'S GOT TO MAKE, IT'S NOT LIKE THE PENSION WHETHER
SHE GETS PERS OR TPAF, DEPENDING ON WHAT THE DECISION IS, THE MONEY HAS BEEN CONTRIBUTED
BY THE EMPLOYEE. JOSEPH A. PALUMBO: CORRECT. JUSTICE SOLOMON:
SO THE FINANCIAL STABILITY OF THE FUND IS NOT THE PROBLEM. JOSEPH A. PALUMBO:
THAT'S IF YOU LOOK AT THE THE FUND AS ALL THE FUNDS TOGETHER, BUT THESE FUNDS ARE SEPARATE.
JUSTICE SOLOMON: UNDERSTOOD. THE FNLD, THE TPAF, THOSE FUNDS ARE NOT AT
RISK BECAUSE SHE HAS BEEN CONTRIBUTING. THE PROBLEM IS HOW DO YOU GET THE PERS MONEY
THAT'S ALREADY THERE INTO TPAF. RIGHT? JOSEPH A. PALUMBO: BUT ALONG WITH
THE PERS CONTRIBUTIONS COMES THE LIABILITY OF -- JUSTICE PATTERSON: ARE YOU
SAYING THAT THE LIABILITY OF THE FUND IS HIGHER BECAUSE SHE WOULD BE TIER 1 IF HER POSITION
WAS ACCEPTED? JOSEPH A. PALUMBO: WHAT I'M TRYING TO SAY PROBABLY
INARTICULATELY, IS RIGHT NOW SHE HAS A PERS ACCOUNT, I DON'T KNOW HOW MUCH ITS WORTH BUT
SAY IN RETIREMENT IT'S A 500,000 DOLLAR LIABILITY, IF IT SWITCHES TO TPAF, NOW THAT
IT'S A 500,DOLLAR LIABILITY IN TPAF, SH SURE PERS BENEFITS, BUT NOW TPAF DOESN'T, TPAF
HAS TO ACCOUNT FOR THAT 500,000 DOLLAR LIABILITY. JUSTICE SOLOMON: BUT DOES THAT
MATTER WHETHER IF TODAY WE SAID TAKE ALL OF PERS MONEY AND PUT IT IN TPAF TO WHICH SHE'S
BEEN CONTRIBUTED, PERS IS NOW CUTOFF, NO MORE CONTRIBUTIONS, PUT IT IN TPAF TO WHICH
SHE'S BEEN CONTRIBUTING, IS THAT ANY DIFFERENT THAN IF THE INTERFUND TRANSFER HAD HAPPENED
WITHIN THOSE TWO YEARS, IS THE FINANCIAL BURDEN A RISK TO THE PENSION ANY DIFFERENT?
JOSEPH A. PALUMBO: NO, BUT IF IT HAD HAPPENED WIDTH WITHIN THE TWO YEAR
PERIOD WHEN THE AK CHAERS ARE PROJECTING THESE ACCOUNTS, THEY'D SEE THAT THE ACCOUNT --
JUSTICE SOLOMON: I UNDERSTAND, BUT THE FINANCIAL RISK TO THE PENSION, THE
FINANCIAL OBLIGATION OF THE PENSION IS EXACTLY THE SAME. JOSEPH A. PALUMBO:
THAT'S CORRECT. IF THE INTERFUND TRANSFER HAD HAPPENED. JUSTICE SOLOMON:
WHETHER IT DID OR IT DIDN'T, IF IT HAPPENS TODAY AND SHE'S BEEN CONTRIBUTING, IF IT HAPPENED
TODAY AND SHE'S CONTRIBUTING TO TPAF AND HAS BEEN FOR ALL THIS TIME, AND ALL THAT PERS
MONEY IS STILL THERE, IF THAT TRANSFER HAPPENED TODAY, THE PENSION FUND OR FUNDS ARE AT
NO GREATER RISK THAN IF IT HAD HAPPENED TWO YEARS AGO. OR TWO YEARS BEFORE, OR TWO YEARS
BEFORE THAT. JOSEPH A. PALUMBO: WELL, THE RISK WOULD JUST BE THE INSTABILITY
OF BEING ABLE TO MAKE ACCURATE PROJECTIONS TO EACH SEPARATE FUNDING GO FORWARD.
CHIEF JUSTICE RABNER: BECAUSE THERE MAY BE 50 OTHER CASES OUT THERE THAT WILL SURFACE
TOEMENT 82 YES. JOSEPH A. PALUMBO: YES, YOUR HONOR, IF MAYBE THERE'S NOT
ONE BUT IF THERE'S MULTIPLE THAT SWITCH FROM PERS TO TPAF, ALL OF A SUDDEN THE TPAF FUND,
THE FINANCIAL MODELS AND THE AK CHEW AREA DATA IS MEANINGLESS ALMOST. JUSTICE
WAINER APTER: BUT THAT WOULD BE THE CASE IF 50 PEOPLE GOT A NEW JOB AND THEY ALL SWITCH
FROM PERS TO TPAF, ALL OF A SUDDEN TPAF IS GOING TO OWE A TON MORE MONEY THAT THEY DIDN'T
OWE BEFORE. JOSEPH A. PALUMBO: THAT'S CORRECT, BUT I THINK THEY WOULD BE
ABLE TO PROJECT THAT KNOWING THE ACCOUNTS ARE STILL OPEN BUT ONCE THEY'RE CLOSED, IT'S
A CLOSED AND LOCKED ACCOUNT, AND ONE DATA POINT -- JUSTICE NORIEGA: BUT
YOU CAN'T PROJECT FOR WHEN PEOPLE DECIDE TO LEAVE THE POSITION, SO THAT HAPPENS OVER THE
COURSE OF THE YEAR AND CREATES A CERTAIN LEVEL OF INSTABILITY OVER THE COURT OF AN ENTIRE
YEAR ANYWAY. JOSEPH A. PALUMBO: YES, THIS WOULD JUST CREATE MORE UNCERTAINTY.
JUSTICE NORIEGA: IF YOU CONCEDE THE FACT THAT THE C O DID LOSE IN TERMS
OF FINANCIAL CONCLUSION FOR HER RETIREMENT PURPOSES? JOSEPH A. PALUMBO:
THE OPTION TO INTERFUND TRANSFER WOULD HAVE BEEN BENEFICIAL TO HER. CHIEF
JUSTICE RABNER: THIS IS BUT ONE FACTOR THOUGH, BECAUSE IF IT WERE DETERMINATIVE, THE
INABILITY TO PROJECT PROPERLY BASED ON WHAT HAPPENED HERE, THEN NO RELIEF WOULD EVER BE
GRANTED, THE BOARD WOULD NEVER EXERCISE ITS DISCRETION IN FAVOR OF SOMEONE LIKE MISSION
SEAGO. JOSEPH A. PALUMBO: THAT'S CORRECT, BUT THAT IS WHY THEY USE THEIR
POWER RARELY AND SPARINGLY. JUSTICE PATTERSON: HAVE YOU -- TALKING ABOUT
THE EXTENT TO WHICH THIS WOULD DE-STABILIZE THE PENSION FUND, ARE YOU AWARE OF ANY OTHER
CIRCUMSTANCE OTHER THAN THIS CASE IN WHICH SOMEONE, AN EMPLOYEE, HAS FILLED OUT THEIR
PORTION OF THE FORM AND THE EMPLOYER HAS FAILED TO PROCESS IT? OR IS THIS CASE AN OUTLIER?
JOSEPH A. PALUMBO: NO, THAT TYPICALLY IS HOW THESE OCCUR, WHERE THE
EMPLOYER -- JUSTICE PATTERSON: NO, NO, BUT THE EMPLOYER FAILS TO FORWARD
THE APPLICATION. JOSEPH A. PALUMBO: CORRECT. JUSTICE PATTERSON:
ARE THE CIRCUMSTANCES HERE REPLICATED IN ANY OTHER CASE THAT YOU ARE AWARE OF.
JOSEPH A. PALUMBO: WHERE THE EMPLOYER FORGOT TO FILL OUT THEIR PORTION OR WHERE THE
EMPLOYER -- JUSTICE PATTERSON: NO, THE EMPLOYER DIDN'T, WHETHER THEY FORGOT
OR WHATEVER REASON. JOSEPH A. PALUMBO: YES, THERE'S ANOTHER CASE RECENTLY
WHERE THE EMPLOYER REFUSED TO FILL OUT THEIR EMPLOYER SECTION AND THE ALLEGATION THERE
WAS THAT THERE WAS A SEPARATE EMPLOYER THEY LEFT ON ACRIMONIOUS TERMS AND THE EMPLOYER
THE ALLEGATION THAT THE BOARD CONSIDERED AND ACCEPTED WAS THAT THE OTHER -- THE FORMER
EMPLOYER WAS RETALIATING AND SPECIFICALLY REFUSED TO FILL OUT THEIR SECTION OF THE FORM.
JUSTICE PATTERSON: AND THE BOARD GRANTED THE RELIEF IN THAT CASE.
JOSEPH A. PALUMBO: THAT ONE -- IT WAS DENIED BUT IN THE APPELLATE DIVISION THE COURT SAT
IN EQUITY AND DECIDED IT WAS UNREASONABLE FOR THE BOARD IN THAT SITUATION. CHIEF
JUSTICE RABNER: I THINK THE QUESTION IS ARE THERE A LOT OF CASES LIKE THIS. JOSEPH
A. PALUMBO: I LOOKED AT THAT, YOUR HONOR, THERE'S ABOUT 2 AND A HALF PER YEAR, BETWEEN
2 AND 3. CHIEF JUSTICE RABNER: HOW FAR HOW LARGE A UNIVERSE. JOSEPH
A. PALUMBO: JUST PERS AND TPAF PIECHLT OF THE. JUSTICE PIERRE-LOUIS: OUT OF
CASES WHERE THE INTERFUND TRANSFER DID NOT GET -- JOSEPH A. PALUMBO: I DON'T HAVE
THE EXACT NUMBER OF KATSDZ BUT WHERE THE EMPLOYEE IS SAYING MY EMPLOYER EITHER FORGOT
OR DIDN'T SEND IN THIS FORM. JUSTICE PIERRE-LOUIS: HAS THE DIVISION MADE
ANY CHANGES TO THE TPAF MEMBER GUIDEBOOK WHICH STATES THAT THE EMPLOYER SHOULD SUBMIT
THE APPLICATION FOR THE INTR FUND TRANSFER. JOSEPH A. PALUMBO: I'M NOT AWARE.
JUSTICE PIERRE-LOUIS: SO THE CURRENT GUIDEBOOK FOR THE DIVISION STILL
STATES THAT FOR THESE INTERFUND TRANSFERS THE APPLICATION SHOULD BE SUBMITTED BY THE
EMPLOYER TO THE DIVISION. JOSEPH A. PALUMBO: I'M NOT A HUNDRED PERCENT SURE.
JUSTICE FASCIALE: AND IN THOSE OTHER TWO CASES WHERE THE EMPLOYER DID NOT
FILE, DID TPAF RELAX THE RULES? JOSEPH A. PALUMBO: I DON'T KNOW, YOUR
HONOR. JUSTICE WAINER APTER: DO YOU HAVE A CITATION TO THE CASE WHERE YOU
SAID THE APPELLATE DIVISION REVERSED? JOSEPH A. PALUMBO: THAT WAS THE NAME
OF THE CASE WAS GRAPH STEEN G R A T H S T I N. JUSTICE PATTERSON: AND THAT'S
AN UNPUBLISHED APPELLATE DIVISION. JOSEPH A. PALUMBO: YES, YOUR HONOR, IT'S
UNPUBLISHED. CHIEF JUSTICE RABNER: IF THE GUIDEBOOK STILL CONTAINS THE
INFORMATION THAT JUSTICE PEER LIEU WEE READ TO YOU, IS THAT TURNING SQUARE CORNERS.
JOSEPH A. PALUMBO: I DON'T THINK SO, BECAUSE IF THERE'S A CONFLICTION BETWEEN STATUTE
AND REGULATION, THE STATUTE AND REGULATIONS CONTROL. JUSTICE PIERRE-LOUIS:
WE'VE SPENDER A GREAT DEAL OF TIME TO TRYING TO DETERMINE WHAT THAT MEANS, AND I THINK
ANYONE WHO'S BEEN IN GOVERNMENT WOULD AGREE THAT IT'S NOT ALWAYS CLEAR WHAT APPLIES, SO
A LOT OF INSTANCES THE MEMBER GUIDEBOOK GUIDES THE EMPLOYEES BECAUSE IT'S NOT MANY
EMPLOYEES, WE'RE SITTING HERE TRYING TO UNDERSTAND WHAT THE STATUTES AND REGULATIONS STATE,
I DON'T KNOW IF MANY EMPLOYEES ARE GOING TO BE ABLE TO FIGURE THAT OUT ON THEIR OWN BY
LOOKING AT THE STATUTE AND REGULATIONS, BUT THE DIVISION ITSELF PUBLISHES A GUIDEBOOK
TO ASSIST EMPLOYEES IN THAT ENDEAVOR AND YOU HAVE A GUIDEBOOK SPECIFICALLY STATING THAT
THE EMPLOYER SHOULD BE SUBMITTING THIS APPLICATION. HOW CAN THAT NOT FACTOR INTO
OUR DECISION WHEN WE'RE TRYING TO DETERMINE WHAT IS APPROPRIATE HERE AND WHAT'S EQUITABLE?
JOSEPH A. PALUMBO: THE ONLY THING I CAN SAY IS THAT UNDER THE REGULATION
AND THE STATUTE THERE'S -- THAT THE REGULATION PUTS IT ON THE MEMBER TO FILE.
JUSTICE SOLOMON: AND YET THE EMPLOYER, I MEAN YOU SAID BEFORE, I DON'T REMEMBER THE TERM
YOU USED, ALMOST ALWAYS IS THE ONE WHO FILES THEIR SECTION. JOSEPH A.
PALUMBO: THEY OFTEN HELP BECAUSE -- JUSTICE SOLOMON: WELL IS IT OFTEN OR
IS IT ALMOST ALWAYS. JOSEPH A. PALUMBO: I'M NOT SURE, BUT IT'S PROBABLY
MORE OF OFT 10 THAN NOT BECAUSE THE EMPLOYER SRL REQUIRED TO SUBMIT THE ENROLLMENT ALLOCATION
SO 33 SUBMIT THE ENROLLMENT APPLICATION WITH THE ENTER FUNDER TRANSFER. JUSTICE
SOLOMON: AND THEY SUBMITTED THE ENROLLMENT APPLICATION HERE BUT NOT THE INTERFUND
TRANSFER. JOSEPH A. PALUMBO: THAT'S CORRECT, THERE'S ALSO A SEPTEMBER 2019
LETTER THAT MISS SEAGO RECEIVED SAYING THAT HER ACCOUNT NOW IS EXPIRED AND STILL DIDN'T
CONTACT THE DIVISION FOR OVER A YEAR BEFORE HER APPLICATION WAS FILED. JUSTICE
FASCIALE: THAT'S BECAUSE HER EMPLOYER TOLD HER THAT THEY HAD FILED THE APPLICATION.
JOSEPH A. PALUMBO: BUT AGAIN IF THEY HAD FILED THE APPLICATION, HER PERS
MEMBERSHIP WONTHD HAVE BEEN OPENED IN MARCH AND HER ACCOUNT WOULDN'T HAVE EXPIRED IN
SEPTEMBER. SHE HAS THE TWO LETTERS, AND EVEN AFTER THE LETTER THAT SHE RECEIVED SAYING
IN YOUR ACCOUNT IS EXPIRED, NOTHING WAS FILED WITH THE DIVISION FOR OVER A YEAR.
CHIEF JUSTICE RABNER: MR. PALUMBO CAN YOU CLARIFY ONE MORE THING, YOU SAID THERE ARE
2 AND A HALF CASES A YEAR LIKE THIS, OUT OF A UNIVERSE OF HOW MANY, HOW MANY INTERFUND
KWGS ARE DONE EACH YEAR APPROPRIATELY. JOSEPH A. PALUMBO: I'M SORRY, I DON'T HAVE
THAT NUMBER. CHIEF JUSTICE RABNER: IS IT HUNDREDS, IS IT THOUSANDS.
JOSEPH A. PALUMBO: I DON'T EVEN KNOW IF I CAN ESTIMATE, BUT IT WOULD BE MORE I WOULD THINK
IN THE HUNDREDS THAN THE THOUSANDS. CHIEF JUSTICE RABNER: THANK YOU.
JOSEPH A. PALUMBO: AGAIN, I'D JUST BE GUESSING, I DON'T COUNSEL THE TPAF BOARD SO I'M
NOT AT THOSE MEETINGS. CHIEF JUSTICE RABNER: OKAY. OTHER QUESTIONS, ANYONE?
ANYTHING YOU'D LIKE TO ADD? JOSEPH A. PALUMBO: NOTHING ELSE, JUST.
CHIEF JUSTICE RABNER: THANK YOU. THANK YOU TO BOTH COUNSEL, WE'LL TAKE THE MATTER UNDER
ADVISEMENT.