Joan Bruzzese is appealing the October 31, 2006 decision of the State Board of Retirement to pay the accumulated deductions and interest from the retirement account of Deighton Ashby to Iris Oden and Heather Ashby (Ex. 1). She appealed timely under the provisions of G.L. c. 32, § 16(4) (Ex. 2). I heard the appeal on November 28, 2007 at the offices of the Division of Administrative Law Appeals, 98 North Washington Street, Boston. At that time, I allowed Iris Oden's motion to intervene.
There are 11 documents in evidence (Exs. 1 - 11). I marked the pre-hearing memorandum of the Petitioner as "A" for identification and the pre-hearing memorandum of the Respondent as "B" for identification. Joan Bruzzese, Donald Bruzzese and Iris Oden testified; there is one tape of the hearing. Both the Petitioner and Respondent filed written closing argument and the record closed on December 17, 2007.
Findings of Fact
1. Deighton Ashby, d.o.b. 1/12/35, worked for the M.D.C. in 1948. He then worked for the City of Cambridge Water Department from 1950 to 1957. He then worked for a public works department until 1962. From 1962 to 1976, he worked for the Fernald State School and became a member of the State retirement system. He then began working in the Massachusetts court system (Exs. 4 and 7).
2. Mr. Ashby had no brothers and sisters and his parents predeceased him (Bruzzese, testimony).
3. While working at Fernald, Mr. Ashby became very good friends with Don Bruzzese, a co-worker. Mr. Ashby met Mr. Bruzzese's wife, Joan, at this time, and became a friend of the family. Mr. Ashby often had meals with the Bruzzese family and they frequently shared holiday meals. On occasion, Mr. Ashby and Ms. Bruzzese attended the theatre together (Bruzzese, testimony).
4. When the Bruzzeses first got to know Mr. Ashby, he was dating Iris Oden, a woman he had known since 1954. She eventually married someone else and then she got divorced in 1968 (Bruzzese and Oden, testimony).
5. On September 22, 1997, Mr. Ashby designated beneficiaries on a State Board of Retirement form. He listed Iris Oden and Heather Ashby, a cousin, as 50% beneficiaries. The form states:
Beneficiary or beneficiaries nominated will receive in the proportion designated any sum due at your death. The right to change any nominated beneficiary is reserved by the member… A Change of Beneficiary Form must be used if you wish to change your designated beneficiaries. You may obtain said form from your payroll department or from the Board of Retirement (Ex. 4).
6. On May 16, 2003, Mr. Ashby executed a will naming Ms. Bruzzese as his executrix. Iris Oden was named as the successor executrix. He left his entire estate to Ms. Bruzzese with Ms. Oden being the successor legatee (Ex. 5).
7. On Thanksgiving of 2003, Mr. Ashby told Ms. Bruzzese that he had left his entire estate to her (Bruzzese, testimony).
8. Mr. Ashby owned and lived in a two-family house in Cambridge. In 2004, he asked the Bruzzeses if they would be willing to move into the other unit and they did. The Bruzzeses spent some of their own money fixing up the house (Bruzzese, testimony).
9. From that point on, it was like the Bruzzeses and Mr. Ashby were one family. They shared many meals. Mr. Ashby developed health problems including severe gout. Ms. Bruzzese drove him to some of his medical appointments (Bruzzese, testimony).
10. By 2006, Mr. Ashby was very sick with cancer. As his health failed, the Bruzzeses became his primary caregivers. On August 24, 2006, Ms. Bruzzese called an ambulance to take Mr. Ashby to the hospital (Bruzzese, testimony).
11. On August 25, 2006, Ms. Bruzzese spoke to Mr. Ashby on the telephone. He told her to watch his mail, be on the lookout for a brown envelope and to bring it to him when it was delivered (Bruzzese, testimony).
12. On August 28, 2006, Ms. Bruzzese delivered the envelope to Mr. Ashby in the hospital. He opened it in front of her and told her that he wanted her to be his beneficiary with the State Board of Retirement. He completed a retirement application including an option selection form first selecting Option A. Ms. Bruzzese asked Mr. Ashby if he really wanted to select Option A. He said no and he then filled out a form selecting Option B. The form was witnessed by a nurse (Bruzzese, testimony).
13. Ms. Bruzzese mailed the application and option form from the Cambridge Central Square Post Office later in the day on August 28, 2006 (Ex. 8).
14. Mr. Ashby died on August 30, 2006 (Bruzzese, testimony).
15. On August 31, 2006, the State Board of Retirement received Mr. Ashby's application for retirement. He gave September 1, 2006 as his desired retirement date. The completed Option B form naming Ms. Bruzzese as the beneficiary was part of the retirement application received on that date (Ex. 7).
16. On September 1, 2006, the State Board of Retirement sent an acknowledgement of receipt of retirement application addressed to Mr. Ashby (Ex. 9).
17. On September 2, 2006, the State Board of Retirement sent Mr. Ashby's employer a Salary Request and Release form, stating that Mr. Ashby "will be retired as of Sep. 1, 2006" (Ex. 11).
18. On September 13, 2006, Ms. Bruzzese's attorney wrote to the State Board of Retirement enclosing a copy of his death certificate and stating that Joan Bruzzese was the named beneficiary for death benefits (Ex. 3).
19. On October 31, 2006, the State Board of Retirement wrote to Ms. Bruzzese's attorney, Ms. Heather Ashby and Ms. Oden stating that the Board would be paying the accumulated deductions to Ms. Oden and Ms. Ashby (Ex. 1).
20. Ms. Bruzzese appealed (Ex. 2).
Conclusion and Order
The decision of the State Board of Retirement to pay the accumulated deductions and interest from the retirement account of Deighton Ashby to Iris Oden and Heather Ashby is affirmed.
General Laws, c. 32, § 11(2)(c) provides, in pertinent part:
Any member, upon his written notice on a prescribed form filed with the board prior to his death, may nominate, and from time to time change, one or more beneficiaries to receive in designated proportions, or in the alternative, any sum becoming payable under the provisions of this subdivision on his death…(emphasis added).
Mr. Ashby died on August 30, 2006 while a member in service. The State Board of Retirement did not receive his application for retirement giving a requested retirement date of September 1, 2006 along with a completed Option B form naming Ms. Bruzzese as his 100% beneficiary until August 31, 2006. Since the Board did not receive the application until August 31, 2006, it was not "filed with" the Board until that date.
In The Town of Falmouth v. Civil Service Commission, 857 N.E.2d 1052, 1056, 447 Mass. 814 (2006), the Supreme Judicial Court noted: "This court has recognized the particular significance of the word 'filed' in the context of an appeal. Generally, it connotes the 'receipt' of the appeal, absent an express intent to the contrary."
An even more recent Appeals Court decision examined the so-called "postmark rule" applicable to adjudicatory proceedings of administrative agencies found at 801 CMR 1.01(4)(b). In Pavian, Inc. v. Robert Hickey, Jr., & another, 874 N.E.2d 670 (Mass.App.Ct. 2007), the Court dismissed as untimely an employee's appeal to the Board of Review of the Division of Unemployment Assistance. The employee had mailed his appeal to the Board on the last date on which to file an appeal and it was not received by the Board until four days later.
In two cases decided at this Division, it was determined that the phrase "filed with" a retirement board meant received by the board. Anne Marajian v. Norfolk County Retirement Board, CR-95-790 (DALA dec. 10/3/96; no CRAB dec.); Mary Laus v. Teachers' Retirement Board, CR-01-850 (DALA dec. 5/14/02; no CRAB dec.).
Since Mr. Ashby died before any retirement allowance became effective for him, his accumulated total deductions are to be distributed under the provisions of G.L. c. 32, § 11(2)(a):
Upon receipt by the board of proper proof of the death of any member before the date any retirement allowance becomes effective for him…the amount of any accumulated total deductions credited to his account in the annuity savings fund of the system shall…be paid in one sum to his surviving beneficiary or beneficiaries entitled thereto…
In 1997, Mr. Ashby designated Iris Oden and Heather Ashby as his beneficiaries. Two days before he died, Mr. Ashby completed a form naming Ms. Bruzzese as his beneficiary but the form was not received by or "filed with" the State Board of Retirement until the day after his death.
In the case of Marsha Smith v. State Board of Retirement, CR-04-344 (DALA dec. 2/14/05; CRAB dec. 6/5/05), DALA and CRAB affirmed the decision of the retirement board awarding one-half of the accumulated total deductions to the ex-husband of the decedent, although the result was "harsh" and "probably not what [the decedent] intended." In 1970, the decedent had named her then-husband as one of her beneficiaries. In 1992, after a 1975 divorce, the decedent filed an application under an early retirement program, completing an option selection form that named her daughter as her 100% beneficiary. Later, the decedent withdrew the retirement application. DALA and CRAB held that the 1992 option selection naming her daughter as the 100% beneficiary did not become effective since the decedent withdrew her retirement application. On appeal, the Superior Court reversed, holding that the decedent had "substantially complied" with the retirement statutes when she filed a change of beneficiary, citing Strauss v. Teachers Insurance and Annuity Association of America, 37 Mass.App.Ct. 357, 639 N.E.2d 1106 (1994).
In the Strauss decision, Dr. Elliott Strauss had two contracts of annuities, identified by two separate numbers, with Teachers Insurance and Annuity Association of America (TIAA); his second wife was the original beneficiary. After getting divorced from his second wife, Dr. Strauss was diagnosed with cancer and contacted TIAA regarding the beneficiary designations for the two annuities. TIAA then sent him a blank change of beneficiary form referencing the number of one of the policies. TIAA also sent a letter with a heading that included the numbers of both policies explaining that to change the beneficiary, he needed to complete the enclosed form. In a postscript, the letter added that if he wished to change the beneficiary under the other contract (the one not shown on the enclosed form), he should let TIAA know so they could prepare the appropriate form. Dr. Strauss immediately filled out the change of beneficiary form, naming his three children from his first marriage as his primary beneficiaries. He returned the form along with a letter stating, "I want my children to be the only beneficiaries for each of the contracts I have with TIAA…" The letter referred to both contracts by their policy numbers. TIAA sent Dr. Strauss another change of beneficiary form with the second contract number on it but Dr. Strauss never read or responded to this letter or a subsequent letter from TIAA. Dr. Strauss underwent cancer treatment and then died 10 months after he contacted TIAA about his beneficiary designations. After his death, his son found the two unopened letters from TIAA.
The Appeals Court affirmed a jury's finding that there had been substantial compliance with the contractual requirements:
The evidence warranted a finding that Dr. Strauss reasonably believed that the notice he sent was sufficient to effect the change in beneficiary that he desired…In the circumstances of this case, where Dr. Strauss notified TIAA of a change of beneficiaries in a manner that satisfied the policy requirements but died before receiving actual notice that further steps were necessary to effect the change, the jury could have found that there was substantial compliance with the policy.
The instant appeal is distinguishable from both the Smith Superior Court decision and the Strauss Appeals Court decision. In the Smith case, the decedent had actually filed with the retirement board an option selection form with a new beneficiary designation as part of an early retirement program application. (DALA and CRAB held that the withdrawal of that application negated the beneficiary designation but the fact remains that the form was actually filed with the board.) In the Strauss decision, Dr. Strauss "notified TIAA of a change of beneficiaries in a manner that satisfied the policy requirements." TIAA had received a letter from Dr. Strauss stating that he wanted his "children to be the only beneficiaries for each of the contracts I have with TIAA…" In contrast, the only beneficiary designation the State Board of Retirement had ever received from Mr. Ashby before his death was the one naming Iris Oden and Heather Ashby as 50% beneficiaries.
Since Mr. Ashby died a member in service before his change of beneficiary form was filed with the retirement board, the provisions of § 11(2)(a) govern and the amount of accumulated total deductions are to be paid to his surviving beneficiaries, Iris Oden and Heather Ashby. The decision of the State Board of Retirement is affirmed.
DIVISION OF ADMINISTRATIVE LAW APPEALS
Kimberly A. Fletcher
First Administrative Magistrate