In the Matter of David Kaslow, Respondent,v.City of New York, et al., Appellants.BriefN.Y.February 11, 2014 REPRODUCED ON RECYCLED PAPER Supreme Court, Kings County To be argued by Index No. 3752/10 KEITH M. SNOW (15 Minutes) COURT OF APPEALS STATE OF NEW YORK In the Matter of the Application of DAVID KASLOW, Petitioner-Respondent, For a Judgment under Article 78 of the Civil Practice Law and Rules, - against - THE CITY OF NEW YORK and THE NEW YORK CITY EMPLOYEES’ RETIREMENT SYSTEM, Respondents-Appellants. APPELLANTS’ REPLY BRIEF MICHAEL A. CARDOZO, Corporation Counsel of the City of New York, Attorney for Respondents-Appellants, 100 Church Street, Room 5-147 New York, New York 10007 ksnow@law.nyc.gov Tel: (212) 356-4055 Fax: (212) 356-4099 PAUL T. REPHEN, KEITH M. SNOW, of Counsel August 30, 2013 1 TABLE OF CONTENTS Page TABLE OF AUTHORITIES .....................................................................................ii PRELIMINARY STATEMENT ............................................................................... 1 ARGUMENT ............................................................................................................. 3 PETITIONER FAILS TO ADDRESS APPELLANTS' ARGUMENTS, AND CANNOT IDENTIFY EITHER VALID BASIS OR AUTHORITY TO SUPPORT THE LOWER COURTS' DECISIONS . .....................................3 A. Standard of Review................................................................................3 B. Petitioner Proposes a Selective and Erroneous Reading of the Plain Language of the Statute. ........................................................................3 C. The Legislative Intent of the Tier 2 and Tier 3 CO-20 Plans. ...............7 D. Petitioner's Remaining Arguments Are Unavialing. .............................8 CONCLUSION........................................................................................................11 ii TABLE OF AUTHORITIES Cases Page McGarrigle v. City of New York, 23 A.D.3d 196 (1st Dep’t 2005) .........................8 Roberts v. Murphy, 2 N.Y.3d 641 (2004)..................................................................5 Schriro v. New York State Teachers’ Ret. Bd., 63 A.D.2d 751 (3d Dep’t 1978).................................................................................................. 8-11 Suffolk Regional Off-Track Betting Corp. v. New York State Racing and Wagering Bd., 11 N.Y.3d 559 (2008) ..................................................3 Wooley v. New York State Dep’t of Correctional Servs., 15 N.Y.3d 275 (2010) ..............................................................................................3 New York Statutes, Chapter Law, Codes, Rules and Regulations Page Chapter 939 of the Laws of 1990...............................................................................7 Ed. Law § 503 ............................................................................................................9 NYC Admin. Code § 13-155 ......................................................................... 3-4, 5, 6 RSSL § 440 ................................................................................................................9 RSSL § 445-a .............................................................................................................5 RSSL § 500 ..............................................................................................................10 RSSL § 504-a ................................................................................................... passim RSSL § 505 ................................................................................................................7 RSSL § 512 ................................................................................................................8 RSSL § 513 ............................................................................................................ 7-8 1 COURT OF APPEALS STATE OF NEW YORK In the Matter of the Application of DAVID KASLOW, Petitioner-Respondent, For a Judgment under Article 78 of the Civil Practice Law and Rules, - against - THE CITY OF NEW YORK and THE NEW YORK CITY EMPLOYEES’ RETIREMENT SYSTEM, Respondents-Appellants. APPELLANTS’ REPLY BRIEF PRELIMINARY STATEMENT As set forth in respondents-appellants’ (“appellants”) main brief (or “Apps. Brief”), the Lower Courts erred in directing appellants to recalculate petitioner-respondent’s (“petitioner”) Tier 3 CO-20 Plan pension to include in his retirement allowance an additional benefit calculation for his prior non-correction City service pursuant to a select portion of an inapplicable Tier 1 and Tier 2 pension calculation statute. Appellants properly determined that the term “credited service” for post-December 19, 1990 Tier 3 CO-20 Plan members is limited to, and consistently defined as, allowable correction service, that RSSL § 504-a(c)(2) is 2 the sole applicable pension calculation provision in the Tier 3 CO-20 Plan, and that Plan members are not entitled to an additional benefit calculation for prior non- correction City service. Petitioner’s claim that he, as a Tier 3 member in the CO-20 Plan, should be entitled to the application of a select Tier 1 and Tier 2 pension calculation provision in addition to the applicable Tier 3 CO-20 Plan pension calculation provision is untenable. Such an interpretation requires an inconsistent definition of the term “credited service” for post-December 19, 1990 Plan members (see Apps. Brief, pp. 19-21), disregards and renders unworkable the sole applicable pension calculation provision contained in RSSL § 504-a(c)(2) (see Apps. Brief, pp. 11, 19-21) and, as explained below, will result in disparity, contrary to the stated Legislative intent of the Plan (240-77),1 by giving Tier 3 CO- 20 Plan members superior benefits to those afforded to similarly situated Tier 3 City police officers and firefighters. For the reasons stated in appellants’ brief, and further addressed herein, the Orders appealed from should be reversed and the Petition dismissed. 1 Numbers in parentheses, unless otherwise indicated, refer to pages in the Record on Appeal. 3 ARGUMENT PETITIONER FAILS TO ADDRESS APPELLANTS’ ARGUMENTS, AND CANNOT IDENTIFY EITHER VALID BASIS OR AUTHORITY TO SUPPORT THE LOWER COURTS’ DECISIONS. A. Standard of Review. In his attorney’s brief dated August 14, 2013 (“Resp. Brief”), petitioner claims that this case is reviewed de novo, and that appellants should therefore not be given any discretion in interpreting the statute. See Resp. Brief, pp. 5-9. Although petitioner does not offer an alternative standard of review, he cites no authority to contest appellants’ position that their interpretation must be upheld if it has rational basis. See Wooley v. New York State Dep’t of Correctional Servs., 15 N.Y.3d 275 (2010). Petitioner further offers no authority contesting that this Court, although not required to so, may afford an agency discretion in defining a term of art, such as the term “credited service” contained in the statute. See Matter of Suffolk Regional Off-Track Betting Corp. v. New York State Racing and Wagering Bd., 11 N.Y.3d 559, 567 (2008). B. Petitioner Proposes a Selective and Erroneous Reading of the Plain Language of the Statute. Petitioner repeatedly claims, on no less than 6 occasions, that the Tier 3 CO-Plan pursuant to RSSL § 504-a(b)(4) states that appellants must “apply” the Tier 1 and Tier 2 pension calculation provision in NYC Admin. Code § 13- 4 155(a)(3)(c) to post-December 19, 1990 Tier 3 CO-20 Plan members. See Resp. Brief, pp. 9-11, 15-17. This interpretation is misplaced. Petitioner’s misquotation of this statute is a perfect illustration of how he seeks to distort the plain language of the statute. Citing RSSL § 504-a(b)(4), petitioner alleges “[he] ‘shall have credited service applied to him . . . in the same manner’ as it applies to a Tier 2 correction officer . . . .” Resp. Brief, p. 11. However, the statute states that a post-December 19, 1990 Tier 3 CO-20 Plan member “ . . . shall have the term ‘credited service’ applied to him or her in the same manner as such term would be applied to a similarly situated correction . . .” in the Tier 2 CO-20 Plan (bold added to text that petitioner omits in quotation). RSSL § 504-a(b)(4). Petitioner’s repeated misstatements in this regard are based solely on his incorrect recitation of a relevant statute. See Resp. Brief, pp. 9-11, 15-17. Petitioner’s quotation, and his argument as a whole, exclude reference to the word “term” and the quotation marks around “credited service.” Id. The reference to the Tier 2 CO-20 Plan in RSSL § 504-a(b)(4) is for the limited purpose of defining the quoted term of art. Petitioner makes no attempt to explain why the limitation to solely define a “term” should be ignored. Petitioner further fails to address how the quoted term of art “credited service” is actually used in the Tier 2 CO-20 Plan as the statute explicitly directs. See RSSL § 504-a(b)(4). 5 As discussed in appellants’ brief (see Apps. Brief, p. 18), “credited service” in the Tier 2 CO-20 Plan is used in the context of, and solely equated to, service in the uniformed correction force (i.e. allowable correction service). See e.g. RSSL § 445-a(a)(3) and 445-a(d)(1) (“credited service” is used in both of these sections in the context of the 20-year minimum requirement to retire – which is “twenty years . . . of allowable service rendered in the uniformed correction force” (i.e. allowable correction service) pursuant to NYC Admin. Code § 13-155). The fact that the term “credited service” would be applied solely in the context of allowable correction service in the Tier 2 CO-20 Plan should end the inquiry into defining the term for post-December 19, 1990 Tier 3 CO-20 Plan members. However, rather than looking to the Tier 2 C0-20 Plan for the explicit purpose of determining how the term “credited service” is used, petitioner selectively seeks the implied application of RSSL § 445-a(c)(4) – a specific provision that is neither referenced nor cited in the Tier 3 CO-20 Plan and actually conflicts with the applicable pension calculation provision in the Tier 3 CO-20 Plan. As described in appellants’ brief (see Apps. Brief, pp. 18-19), and as petitioner has failed to address, implied application of a specific non-cited pension provision is impermissible. See Roberts v. Murphy, 2 N.Y.3d 641 (2004). Petitioner also summarily contends that Tier 1 and Tier 2 correction officers receive “credited service” for non-correction City service, and claims that 6 appellants agree with this assertion. See Resp. Brief, pp. 9-13, 15-17. This is untrue. Although Tier 1 correction officers and Tier 2 CO-20 Plan members receive a pension calculation that considers non-uniformed City service, these members do not receive “credited service” for this type of service. Petitioner conflates service credit (i.e. “credited service” which is the minimum amount of time required to retire with a service pension under a plan (150)) with pension calculations (how a retirement allowance is computed (172)). Although service credit is a component used to calculate a retirement benefit, service credit provisions and pension calculation provisions are two separate and district aspects of retirement benefits that are codified and contemplated separately. See e.g. RSSL § 504-a(c)(1) (Tier 3 CO-20 Plan service credit provision); RSSL § 504-a(c)(2) (Tier 3 CO-20 Plan pension calculation provision). This distinction is made apparent by the very statute petitioner seeks to invoke; NYC Admin. Code § 13-155(a)(3). Wherever uniformed correction service is mentioned in the Tier 1 and Tier 2 pension calculation provision, the statute makes plain that that this service is “credited” to the member. See NYC Admin. Code § 13-155(a)(3)(a) and (c). Conversely, where the statute references a calculation for non-correction City service, there is no reference to “credited” since non-uniformed City service is not credited service for Tier 1 and Tier 2 members. See NYC Admin. Code § 13-155(a)(3)(c). 7 C. The Legislative Intent of the Tier 2 and Tier 3 CO-20 Plans. Petitioner’s analysis regarding the Legislative intent to create parity between the CO-20 Plans and other uniformed members like firefighters and police officers is flawed. See Resp. Brief, pp. 18-20. Petitioner erroneously attempts to claim that the Legislature intended to create parity between the Tier 3 CO-20 Plan with other Tier 2 uniformed plans. However, nothing in the legislative history suggests that Tier 3 correction officers should receive Tier 2 or Tier 1 benefits. Rather, by contemporaneously enacting both a Tier 2 CO-20 Plan and Tier 3 CO-20 Plan (see Chapter 936 of the Laws of 1990), it is apparent that Legislature envisioned parity that was subject to the statutory tiered structure. Therefore, the Tier 2 CO-20 Plan was created to be similar to other Tier 2 uniformed plans, while the Tier 3 CO-20 Plan at issue here was structured to contemplate the Tier 3 uniformed provisions. As with the Tier 3 CO-20 Plan, the Tier 3 uniformed provisions applicable to certain City police officers and firefighters limit the type of service credit available (see RSSL § 513(c)(2)) and do not include an additional benefit calculation for non-uniformed City service (see RSSL § 505). Notably, the language used in RSSL § 504-a(b)(4) to limit the definition of “credited service” for post-December 19-1990 Tier 3 CO-20 Plan 8 members closely resembles the language of RSSL § 513(c)(2), which also limits the definition of service credit for Tier 3 City police officers and firefighters. D. Petitioner’s Remaining Arguments Are Unavailing. Petitioner incorrectly claims that this is the third case in which the statutory definition of “credited service” has be litigated. See Resp. Brief, pp. 2, 6- 9. The two cases petitioner cites involve the interpretation of a collective bargaining agreement. The issue there were whether longevity pay should be included in the calculation of “wages earned” pursuant to RSSL § 512(a), and whether the collective bargaining agreement was sufficient to waive any constitutional protections. See e.g. Matter of McGarrigle v. City of New York, 23 A.D.3d 196, 198 (1st Dep’t 2005). These cases did not deal with whether prior non-correction City service is considered “credited service” for post-December 19, 1990 Tier 3 CO-20 Plan members under the statute (both cases involved correction officers who join NYCERS in 1982 and were therefore not bound by the post- December 19, 1990 restriction). Although, petitioner does not address, and presumably does not challenge, appellants’ arguments concerning statutory construction and interpretation (see Apps. Brief, pp. 11-17 and 19-21), he cites Matter of Schriro v. New York State Teachers’ Ret. Bd., 63 A.D.2d 751 (3d Dep’t 1978) for the proposition that statutes enacted contemporaneously should be harmoniously 9 applied. See Resp. Brief, p. 13. It is unclear why petitioner relies on this case as it completely undermines his argument and supports appellants’ position. In Schriro, a group of State teachers joined the State Teachers’ Retirement System prior to 1973, later withdrew their membership and rejoined the System in 1975. The Legislature enacted laws regarding the purchasing of military time for public retirement service credit. One provision was codified in Education Law § 503(10) (a Tier 1 State teachers statute) while the other was codified in RSSL § 440 (a Tier 2 statute). The Tier 1 Education Law provision applied to State teachers who joined a retirement system before July 1, 1973, and provided for a broader military buyback. The Tier 2 RSSL provision applied to applicable members who joined or rejoined a retirement system on or after July 1, 1973, but prior to July 1, 1976, and provided for a more restrictive military buyback provision. See Schriro, 63 A.D.2d at 751-52. The Third Department held that the pension statutes should be read harmoniously overall, and analyzed which Tier applied to these members. Since the members “rejoined” the System in 1975 after previously withdrawing their membership, the Court held that the members were subject to the later and more restrictive Tier 2 provision in the RSSL. The Court reasoned that since these member were subject to Tier 2, and a provision within the applicable Tier states 10 that in the event of a conflict of law, the provisions of that article shall govern, the RSSL provision controlled. Id. Here, there is no dispute that petitioner is subject to Tier 3. Using the Court’s analysis in Schriro, to the extent that any other provision conflicts with an applicable Tier 3 provision, the Tier 3 provision must apply. See Apps. Brief, p. 11 for the Tier 3 CO-20 Plan pension calculation provision that must apply “[n]otwithstanding any other provision of law to the contrary. . . ” (RSSL 504- a(c)(2)(i)), and p. 17 for the overall applicability of Tier 3, which states that “[i]n the event that there is a conflict between the provisions of this [Tier 3] article and the provisions of any other law or code, the provisions of this article shall govern” (RSSL § 500(a)). The Schriro Court’s analysis of the Legislative history also strongly supports appellants’ position. The Court noted that same Legislature enacted the Tier 1 Education Law provision and amended the applicable Tier 2 RSSL provision regarding military buybacks, and therefore intended the two disparate provisions to be compatible in the overall tiered public pension structure. See Schriro, 63 A.D.2d at 752. As explained in more detail above, in contemporaneously enacting the Tier 2 and Tier 3 CO-20 Plans, the Legislature intended to maintain the tiered structure by amending and keeping separate the 11 Tiers. The result here, as in Schriro, is that the later tier’s provisions control, and provide for a more restrictive benefit than an earlier tier’s provisions. CONCLUSION FOR THE REASONS AFORESAID, THE ORDERS APPEALED FROM SHOULD BE REVERSED, WITH COSTS. MICHAEL A. CARDOZO Corporation Counsel of the City of New York Attorney for Appellants 100 Church Street, Room 5-147 New York, New York 10007 ksnow@law.nyc.gov (212) 356-4055 By: ________________________ Keith M. Snow PAUL T. REPHEN, KEITH M. SNOW, of Counsel