Hosea v. City of Phoenix Fire Pension Bd.

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IN THE COURT OF APPEALS STATE OF ARIZONA DIVISION ONE WILLIAM T. HOSEA, Plaintiff-Appellant, v. CITY OF PHOENIX FIRE PENSION BOARD, an administrative body, Defendant-Appellee. ) ) ) ) ) ) ) ) ) ) ) ) ) ) 1 CA-CV 09-0105 DEPARTMENT E DIVISION ONE FILED: 04-29-2010 PHILIP G. URRY,CLERK BY: GH O P I N I O N Appeal from the Superior Court in Maricopa County Cause No. LC 2007-000767-001 DT The Honorable William B. Schafer, III AFFIRMED The Law Offices of Judith E. Abramsohn by Judith E. Abramsohn Attorneys for Appellant Phoenix Ryan Rapp & Underwood, PLC by David L. Niederdeppe Attorneys for Appellee Phoenix Kutak Rock, LLP by Marc R. Lieberman Mary Grace McNear Attorneys for Fund Manager of Public Safety Personnel Retirement System, Amicus Curiae W E I S B E R G, Judge Scottsdale ¶1 William T. Hosea appeals from a judgment of the superior court affirming an administrative decision of the City of Phoenix Fire Pension Board denying his application for an accidental disability pension. For reasons that follow, we affirm. BACKGROUND ¶2 Hosea was employed as a firefighter with the City of Phoenix Fire Department from March 7, 1977 to May 31, 2007. As such, he was a member of the Public Safety Personnel Retirement System ("System"). job and had In December 1994, Hosea was injured on the surgery in June 1995. Although he had some continuing problems from the surgery, he was released to fullduty status in October 1995. ¶3 On April 17, 2002, Hosea Retirement Option Plan ("DROP"). applied for the Deferred Under this plan, a member of the System with twenty years of credited service who is eligible for normal retirement may elect to participate in the DROP. A member who elects to participate in the DROP shall "voluntarily and irrevocably" designate a retirement date of not more than sixty consecutive months into the future and agrees to terminate employment on the designated date. See Arizona Revised Statues ("A.R.S.") §§ 38-844.02, -844.03(A),(B) (Supp. 2009). Although there are significant adverse economic consequences if a member fails to terminate employment on completion of the DROP period, 2 see A.R.S. § 38-844.03(C), Hosea irrevocably designated his participation in the DROP to terminate on May 31, 2007. ¶4 On July 9, 2006, while on duty, Hosea was injured when a defective seat on a truck collapsed, which caused him pain and other medical problems. July 19, 2006. physician on Hosea submitted an injury report on Using his own medical insurance, Hosea saw one August 15, 2006 for a diagnosis, and another physician on September 10, 2006 for medical treatment. He did not, however, apply for workers' compensation benefits or seek medical treatment through his employer's health center. Hosea was assigned to light duty at Sky Harbor Airport, which allowed him to work full time. He used about 300 hours of sick leave and 265 hours of vacation leave in order to continue working as a firefighter and "extend out as far as [he] could." ¶5 On May 17, 2007, Hosea was examined by a physician's assistant at the Phoenix Fire Department's Health Center. After examining him and reviewing his previous medical records, the physician's assistant recommended that Hosea "continue on full duty status." Hosea had not made the Health Center aware of his injury or physical limitations until that date. ¶6 One week later, on May 24, 2007, Hosea filed an application for an accidental disability pension with the City of Phoenix disability Fire benefits Pension arising Board from 3 ("Board"). the July He 9, requested 2006 injury, effective May 31, 2007, the same day as the end of the DROP period. He attached medical records in support of his application. Hosea worked on full duty status as a firefighter until May 31, 2007, the last day of the DROP period. ¶7 At a meeting held on June 15, 2007, the Board declined to send Hosea to a medical board for an examination and denied his application for an accidental disability pension because there was no "compelling evidence that [he] left the workforce because of his disability." The retirement beginning June 1, 2007. June 20, 2007, application the "after Board Board Hosea normal In a letter to Hosea dated indicated determining granted that that the it denied medical the evidence submitted by you did not indicate your condition(s) caused you (or would have caused you) to have to terminate your position and retire." Hosea requested a rehearing after which the Board unanimously upheld its earlier decision, finding that Hosea did not terminate his employment "by virtue of the disability" but "by virtue of [DROP]." ¶8 On November 30, 2007, Hosea filed a complaint seeking judicial review of the Board's decisions in the superior court. Following oral argument, the court affirmed the Board's denials of Hosea's application. After entry of final judgment, Hosea filed a timely notice of appeal. 4 We have jurisdiction pursuant to A.R.S. §§ 38-847(J) (Supp. 2009), 12-913 (2003) and 12- 120.21(A) (2003). DISCUSSION ¶9 On appeal, Hosea argues that the Board violated the terms of the System by denying his application for accidental disability benefits without appointing a medical board and that its decision was an abuse of capricious and contrary to law. discretion, arbitrary and He thus claims the superior court erred in affirming the Board's action. See A.R.S. § 12- 910(E) (2003)(superior court shall affirm agency action unless it "is not supported by substantial evidence, is contrary to law, is arbitrary and capricious or is an abuse of discretion"). Standard of Review ¶10 We view the evidence in the light most favorable to upholding the decision of the administrative agency and will "affirm the decision unless it is arbitrary, capricious, or an abuse of discretion." Weller v. Ariz. Dep't of Econ. Sec., 176 Ariz. 220, 224, 860 P.2d 487, 491 (App. 1993). In reviewing the superior court's ruling upholding the administrative decision, "we independently examine the record to determine whether the evidence supports the judgment." Webb v. State ex rel. Ariz. Bd. of Med. Exam'rs, 202 Ariz. 555, 557, ¶ 7, 48 P.3d 505, 507 (App. 2002). substitute its "Neither this court nor the superior court may judgment for that 5 of the agency on factual questions or matters of agency expertise . . . [but] [w]e apply our independent judgment, however, to questions of law, including questions of statutory interpretation . . . ." (citations omitted). Id. Further, even if "there is room for two opinions and we believe that an erroneous conclusion has been reached," we will administrative not agency set unless aside "there the decision has been of an 'unreasoning action, without consideration and in disregard for facts and circumstances.'" Petras v. Ariz. State Liquor Bd., 129 Ariz. 449, 452, 631 P.2d 1107, 1110 (App. 1981) (quoting Tucson Pub. Sch. Dis. No. 1 of Pima County v. Green, 17 Ariz. App. 91, 94, 495 P.2d Flagstaff, 861, 167 864 (1972)). Ariz. 1990)(administrative 412, decision See 417, also 808 supported Woerth P.2d by v. 297, City 302 competent of (App. evidence may not be set aside as being arbitrary and capricious). Refusal to Appoint Medical Board ¶11 Hosea argues that a finding of accidental disability by the Board can only be based on medical evidence provided by a medical board under the provisions set forth in A.R.S. § 38-859 (Supp. 2009). He contends that the Board's refusal to appoint a medical board before denying Hosea's application for accidental disability A.R.S. § benefits violated 38-847(E)(Supp. the 2009)("A terms local of the board System. shall have See no power to add to, subtract from, modify or waive any of the terms 6 of the system, change or add to any benefits provided by the system or waive or fail to apply any requirement of eligibility for membership or benefits under the system."). He also claims that the Board's decision was arbitrary, capricious and an abuse of discretion. The Board responds that it was not required to appoint a medical board in this case because Hosea did not meet the threshold eligibility criterion for an accidental disability pension under A.R.S. § 38-844(B) (Supp. 2009). 1 the Board that medical evidence of a We agree with purported accidental disability is unnecessary when the alleged disability could not have been a cause of the member's retirement. ¶12 Pursuant to A.R.S. § 38-844(B), "A member is eligible for an accidental disability pension if the member's employment is terminated added.) mental by reason of accidental disability." (Emphasis An "accidental disability" is defined as "a physical or condition that the local board 2 finds totally and permanently prevents an employee from performing a reasonable 1 There are three statutory grounds for disqualification from eligibility for an accidental disability pension: (1) "An injury suffered while engaged in a felonious criminal act or enterprise. (2) Service in the armed forces of the United States that entitled the member to a veteran's disability pension. (3) A physical or mental condition or injury that existed or occurred before the member's date of membership in the system." See A.R.S. § 38-844(D) (Supp. 2009). 2 The "Local board" means "the retirement board of the employer, who are persons appointed to administer the system as it applies to their members in the system." A.R.S. § 38-842(30) (Supp. 2009). 7 range of duties within the employee's job classification and that was incurred in the performance of the employee's duty." A.R.S. § 38-842(1)(Supp. 2009). A finding of accidental disability "shall be based on medical evidence by a physician or clinic appointed by (emphasis added). the local board." A.R.S. § 38-859(C) Further, "All employees shall undergo medical examinations before a physician or clinic appointed by the local board" and an employee who fails to comply with such examination, "waives all rights to disability benefits." § 38-859(D)(emphasis added). an A.R.S. Finally, the examining physician or clinic "shall report the results of the examinations to the local board." ¶13 A.R.S. § 38-859(E) (emphasis added). Hosea argues that because of the mandatory language found in A.R.S. § 38-859, the Board was required to appoint a medical board when Hosea applied for an accidental disability pension. In legislative support history of of his argument, former A.R.S. Hosea § relies 38-844(C) on the that had provided in part that the "board shall have the right to waive the requirement for a medical examination if it determines that such an examination is unnecessary." He also refers to statutory changes to former A.R.S. § 38-842(1) that had allowed a finding of disability "based on medical evidence satisfactory to the Board." In 1983, the legislature amended this sentence to require that "a finding of accidental disability shall be 8 based on medical evidence by a doctor or clinic appointed by the See 1983 Ariz. Sess. Laws, Ch. 300, § 4 (1st Reg. local board." Sess.). He contends that these amendments reflect the legislature's intent to prohibit the local board from making a decision on an application for a disability pension in the absence of a medical examination. ¶14 Here, however, the Board denied Hosea's application for a disability pension based on its finding that he terminated his employment "because his DROP period had expired," rather than "by reason of A.R.S. § 38-844(B). accidental disability," as controlled by On the record before us, the Board's action was based on substantial evidence and therefore, was neither arbitrary and capricious, nor an abuse of discretion. ¶15 At the rehearing on Hosea's application, Board member Tobin told Hosea that to decide in his favor, the Board had to find that Hosea suffered an injury that occurred in the performance of his duties, that the injury prevented him from performing a reasonable range of duties, that the injury was total and permanent, and that "the reason for your termination of your employment must be the disability." Tobin added that, "[o]ur concern, Tom, is you worked your last day on the Phoenix Fire Department on a fire truck prior to retirement . . . . You were on duty that day in the capacity of a full time firefighter at the airport." 9 ¶16 In explaining why the Board was having "a difficult time" sending Hosea for an independent examination, Tobin observed that Hosea did not seek workers' compensation benefits or treatment at his employer's health center and his employer had no knowledge of his alleged inability to perform his duties. He remarked that, although Hosea claimed to be permanently disabled, two weeks prior to that he had worked on a Phoenix fire truck. He continued, if you had a job-related injury that occurred in the performance of your duties, those injuries are covered by work[ers'] compensation and you should have been on industrial during that time. When . . . you're off on sick leave, the appearance is that you're off on a personal medical illness, not a work-related injury. Hosea, however, explained that he did not pursue this course of action because "they would have taken me out of the field in a minute," and that "firemen always would rather be on duty than sitting in waiting rooms and going to doctors' appointments and being on light duty . . . ." ¶17 Hosea admitted, however, that except for paid leave, he had worked the full sixty months of the DROP period. 3 He also stated that he understood the board's skepticism, and that "it's kind of a remarkable coincidence that my [DROP] came up the same time I would have had to quit." As Tobin observed, "by his own 3 Although under A.R.S. § 38-844.03(C), Hosea could have continued to work beyond the DROP period, the record reflects he had no intention of doing so. 10 admission," Hosea continued working as long as he could because "he had a [DROP] dead date for retiring." He stated, "the record Fire shows that you left the Phoenix Department employment . . . because your [DROP] period expired. because you were disabled. It was because you finished out as far as you could go on the [DROP]." He continued, "This is why we denied your initial application." True." Tobin concluded that Hosea responded, "True. "the bottom work[ed] his last day on a fire truck. permanently disabled the day he left. ¶18 Board member It wasn't Zuercher also line is [Hosea] He was not totally and He worked." observed that Hosea was employed as a firefighter for the full sixty months and had "worked the last day possible under the [DROP] period that he could work as a full-duty, on-duty firefighter." Board member Larsen explained that "the first criteria that has to be met is did [you] leave the work force because of [your] injury or for some other reason. When the record is that you worked your last day, we didn't have any indication that you couldn't work beyond your last day." ¶19 Tobin later remarked that "you were working in your full capacity just prior to your retirement date . . . . [W]hen you re working on one day, unless something happens on that day to subsequently change your status, the very next day you can't 11 be totally and permanently disabled." Board Member Moore agreed with this conclusion. ¶20 The evidence supports the Board's decision that Hosea was not eligible to receive disability benefits because he did not terminate his employment by reason of accidental disability. After Hosea's July 9, 2006 injury, using his own medical insurance, he saw a physician for a medical diagnosis on August 15, 2007 and a second physician for treatment on September 10, 2007. Although he reported the injury to his employer, he did not apply for workers' compensation benefits, nor did he then seek treatment through his employer's health center. he used paid sick leave when required by his injury. Instead, According to Hosea, he did this because he did not want to be taken "out of the field," but instead wanted to extend his career as long as he could. ¶21 by On May 17, 2007, Hosea was examined for the first time a physician's Health Center. continue assistant at the Phoenix Fire Department's The physician assistant recommended that Hosea working on full duty status. One week later, he applied for an accidental disability, pension that was to begin on May period. 31, 2007, "coincidentally" Nonetheless, firefighter" explanation through as to why the Hosea worked May 31, he waited 12 as 2007. so last a day of "full-duty, the DROP on-duty Notwithstanding long to apply for his an accidental disability pension, given the "remarkable" coincidence that the DROP date was the same as the date of his alleged disability and the other uncontested facts before it, the record justifies the Board's conclusion that Hosea did not terminate his employment by reason of accidental disability. Because Hosea did not meet the initial statutory requirement for eligibility under A.R.S. § 38-844(B), the Board was not required to appoint a medical board before denying his application for disability benefits. ¶22 Hosea nonetheless maintains that despite the facts before it, as a matter of law, the statutory scheme does not afford the Board the discretion to reject his application for an accidental disability pension without first referring him to a medical board for an examination, and that the Board therefore acted contrary to law in refusing to do so. We, however, disagree. ¶23 We begin by noting that in construing statutes, we interpret them so as "to 'find and give effect to legislative intent'" and to give them "a fair and sensible meaning." Walter v. Wilkinson, 198 Ariz. 431, 432, ¶¶ 6, 10 P.3d 1218, 1219 (App. 2000) (interpreting statute requiring mental health experts to conduct examinations "simultaneously" to mean within a "short time frame," not at "precisely the same time"). "If statutory language is clear and unambiguous, it is normally conclusive 13 unless clear legislative intent to the contrary impossible or absurd consequences would result." exists or Bustos v. W. M. Grace Dev., 192 Ariz. 396, 398, 966 P.2d 1000, 1002 (App. 1997). We construe statutory provisions "'in light of their place in the statutory scheme,' so 'they may be harmonious and consistent.'" State v. Flynt, 199 Ariz. 92, 94, ¶ 5, 13 P.3d 1209, 1211 (App. 2000) (citations omitted). ¶24 Reading the applicable statutes together, we interpret them to mean that when the Board subsequently makes a "finding of accidental . . . disability" in determining whether to grant an accidental disability pension, such finding must be based on "medical evidence" provided by a medical board. 38-859(C). suggests, The that statutory the Board scheme does not appoint a medical See A.R.S. § require, board as Hosea in every instance in which a member applies for an accidental disability pension, when, as here, such a procedure is wholly unnecessary and such a conclusion absurd. See Pinal Vista Prop.s, L.L.C. v. Turnbull, 208 Ariz. 188, 193, ¶ 17, 91 P.3d 1031, 1036 (App. 2004)("Statutes act."). cannot be interpreted to require a futile In this case, the appointment of a medical board would have been futile, and Hosea's interpretation of the statutes to mandate that requirement in all cases would lead to an absurd consequence not intended by the legislature. 14 ¶25 Hosea finally asserts that the Board's decision was contrary to law because the Board erroneously assumed that Hosea's participation in the DROP precluded him from receiving an accidental disability pension. Hosea relies on Parkinson v. Guadalupe Pub. Safety Ret. Local Bd., 214 Ariz. 274, 151 P.3d 557 (App. 2007), to support his claim that a member can receive an accidental disability pension if he meets the statutory requirements for an accidental disability, even if he has other reasons for terminating his employment. ¶26 Parkinson was a fire chief who suffered a neck injury on the job in 2000 but returned to work in 2001. 2, 151 P.3d at 558. 2003. Id. Id. at 275, ¶ His medical condition was not resolved by On February 3, 2004, Parkinson was placed on paid administrative leave alleged misconduct. pending an Id. at ¶ 3. internal investigation for On February 6, 2004, Parkinson submitted an application for an accidental disability pension. Id. at ¶ 4. of On February 17, 2004, Parkinson submitted a letter resignation, and in July 2004, the Board approved his application for an accidental disability pension. Id. at 276, ¶¶ subsequently 5-6, received 151 at information Parkinson's conducted P.3d resignation a rehearing. 559. Because questioning was an Id. the Board whether accidental at ¶ 6. "the cause of disability," it Determining that Parkinson's resignation was not caused solely by his disability, 15 it reversed its earlier order and denied Parkinson appealed to the superior court. the application. Id. at ¶ 10. Finding that Parkinson had suffered a job-related injury and that he had resigned because of Board's decision. his disability, the court reversed the The Board appealed, and this court affirmed the judgment of the superior court. Id. at 277, ¶¶ 5-10, 151 P.3d at 560. ¶27 We held that even if one reason Parkinson resigned was because he feared the results of the investigation, "[n]o statute provides that a member's accidental disability must be the sole reason for his resignation or that the Board must find as a fact that a member's disability is the sole cause of the end of his employment." find in the statutory Id. at ¶ 15. scheme any We stated that "we do not requirement that a pension applicant have a single reason, an objectively credible reason or even a reasonable reason for seeking a pension." Id. at 278, ¶ Legislature 18, 151 P.3d at 561. We concluded that the intended that a member is eligible for a disability pension "if the Board disability, finds that he [and] that such suffers disability decision to terminate employment." ¶28 contends Hosea that claims even if that one a medically is a documented cause of his Id. Parkinson reason for controls his here. termination He of employment was because he was at the end of the DROP period, he 16 is not precluded from receiving a other reason was his disability. disability pension if his Hosea therefore argues that the Board's refusal to process his application and appoint a medical board was contrary to the holding in Parkinson. ¶29 in The Board has acknowledged that a member participating the DROP terminate could become participation disability benefits. (Supp. 2009). disabled in the during DROP, the DROP be eligible and period, for See A.R.S. §§ 38-844.06(B), -844.04(B)(4) But it asserts, and we agree, that the facts of this case are distinguishable from those in Parkinson. Here, Hosea was continued on full status duty on May 17, 2007 and worked until the last day of the DROP, which was May 31, 2007. Because of the DROP, it was advantageous for him to retire on May 31, alleged 2007, which disability supports the he did. could Board's Rejecting have been a finding that the his claim reason, sole the that his evidence reason Hosea terminated his employment was because his DROP period expired. Thus, under the express language of A.R.S. § 38-844(B), Hosea's employment was not terminated by reason of accidental disability, and he was not eligible for an accidental disability pension. Parkinson does not compel a different result. CONCLUSION ¶30 Because Hosea did not meet the threshold statutory eligibility requirement under A.R.S. § 38-844(B), the Board was 17 not required to appoint a medical board under the provisions of A.R.S. § 38-359 or otherwise process disability benefits before denying it. 4 the judgment of the superior court. his application for We accordingly affirm Hosea has requested an award of attorneys' fees on appeal pursuant to A.R.S. § 12348(A)(2), which we deny. We award the Board, as the prevailing party, its costs on appeal subject to compliance with Arizona Rule of Civil Appellate Procedure 21. /s/__________________________ SHELDON H. WEISBERG, Presiding Judge CONCURRING: /s/_________________________________ PHILIP HALL, Judge /s/_________________________________ JOHN C. GEMMILL, Judge 4 The Fund Manager of the System submitted a brief in support of the Board as an amicus curiae pursuant to Rule 16(c), Arizona Rules of Civil Appellate Procedure, in support of the Board. The Fund Manger raises additional issues to which Hosea has responded in an Answering Brief. Because of our resolution of this appeal, we need not address those issues. 18

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