JOSEPH SHAFTO v. BOARD OF TRUSTEES OF THE POLICE AND FIREMEN'S RETIREMENT SYSTEM

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

JOSEPH SHAFTO,

Appellant,

v.

BOARD OF TRUSTEES OF THE

POLICE AND FIREMEN'S

RETIREMENT SYSTEM,

Respondent.

________________________________

August 17, 2016

Argued April 27, 2016 Decided

Before Judges Fuentes and Koblitz.

On appeal from the Board of Trustees of the Police and Firemen's Retirement System, Docket No. 09734-2012S.

James J. Uliano argued the cause for appellant (Chamlin, Rosen, Uliano & Witherington, attorneys; Mr. Uliano, of counsel; Andrew T. Walsh, on the brief).

Jane G. Lafferty, Deputy Attorney General, argued the cause for respondent (Robert Lougy, Acting Attorney General, attorney for respondent; Melissa Raksa, Assistant Attorney General, of counsel; Ms. Lafferty, on the brief).

PER CURIAM

Joseph Shafto appeals from the final determination of the Board of Trustees of the Police and Firemen's Retirement System (PFRS Board) finding he is no longer permanently and completely disabled and unable to perform the duties of a police officer in the City of Asbury Park. The PFRS Board also directed that appellant be reinstated to his former position and reenrolled in the PFRS.

Appellant argues the PFRS Board misapplied the Supreme Court's decision in Richardson v. Board of Trustees, Police & Firemen's Retirement System, 192 N.J. 189 (2007), and overlooked medical evidence that proved he is not physically capable of performing his duties as a police officer due to a work-related injury that rendered him unable to use his arm above his head with any strength. Appellant also argues the Administrative Law Judge (ALJ) who conducted an evidentiary hearing improperly impugned appellant's credibility based on his failure to report to the PFRS Board two workers' compensation awards he received during the time he was collecting permanent disability retirement benefits.

After considering the record developed by the PFRS Board, and mindful of our standard of review, we affirm.

I

Shafto was employed as a police officer in the City of Asbury Park from 2006 until July 31, 2010. On August 11, 2010, Shafto filed an application for accidental disability retirement benefits with the PFRS Board pursuant to N.J.S.A. 43:16A-7, certifying he was completely and permanently physically unable to perform his duties as a police officer "as a direct result of a traumatic event occurring during and as a result of the performance of his regular or assigned duties."

On January 10, 2011, the PFRS Board awarded Shafto only ordinary disability retirement benefits. On March 14, 2011, the PFRS Board awarded Shafto accidental disability retirement benefits under N.J.S.A. 43:16A-7 based on additional information he provided. However, in a letter dated March 15, 2011, the PFRS Board Secretary Wendy Jamison made clear to Shafto that he was required "to undergo annual medical examinations for the first five years to determine if [he] continues to be totally and permanently disabled and therefore eligible for continued receipt of a disability retirement allowance."

On April 6, 2012, Dr. Arnold T. Berman1 performed an Independent Orthopedic Medical Evaluation of Shafto. Based on this evaluation, Dr. Berman recommended to the Division of Pension and Benefits that Shafto be deemed ineligible to continue to receive an accidental disability pension. Dr. Berman diagnosed Shafto with right shoulder derangement, which pre-dated the May 5, 2009 employment-related traumatic event, and upon which the PFRS Board based the initial accidental disability retirement benefits award. After reviewing Dr. Berman's evaluation and recommendation, the Medical Review Board determined Shafto "is no longer totally and permanently disabled as a Police Officer." The Medical Review Board "approved his reinstatement from Accidental Disability."

In a letter dated June 19, 2012, Secretary Jamison informed Shafto's attorney that at a meeting held on June 18, 2012, the PFRS Board had accepted the Medical Review Board's findings and consequently reconsidered Shafto's application for accidental disability retirement benefits. Jamison also apprised Shafto's counsel that she was advising the City of Asbury Park that Shafto is no longer considered by the PFRS Board to be totally and permanently disabled from the performance of his duties as a police officer; therefore, Asbury Park should reinstate him to his former position as provided under N.J.S.A. 43:16A-8(2).

In a letter dated June 22, 2012 and addressed to Secretary Jamison, Shafto's attorney argued the PFRS Board's decision violated his client's right to due process of law because it was made without prior notice to Shafto and did not afford him an opportunity to refute the Medical Review Board's findings. Counsel requested the PFRS Board relist Shafto's case on its agenda for reconsideration of the June 18, 2012 determination. In response, the PFRS Board transmitted the matter to the Office of Administrative Law as a contested case to be heard before an ALJ.

The ALJ assigned to the case conducted an evidentiary hearing on April 1, and May 21, 2014. The discrete issue before the ALJ was whether there was a sufficient basis to find, by a preponderance of the credible evidence, that Shafto

is permanently and totally disabled as a direct result of a traumatic event occurring during and as a result of the performance of his [or her] regular or assigned duties and that such disability was not the result of the member's willful negligence and that such member is mentally or physically incapacitated for the performance of his [or her] usual duty and of any other available duty in the department which his [or her] employer is willing to assign to him [or her].

[N.J.S.A. 43:16A-7(1).]

The ALJ heard the testimony of Dr. Berman, Dr. Cary Skolnick, and Shafto. The ALJ found Shafto suffered his first work-related accident on October 6, 2006, when his vehicle struck a deer while transporting a prisoner. As a result of this traumatic event, Shafto suffered a torn rotator cuff which was surgically repaired on August 16, 2007. Shafto made a full recovery from this injury and eventually returned to work as a police officer; he was initially placed on light duty until he resumed regular duties without limitations. On May 9, 2009, Shafto reinjured his right shoulder during an altercation with a suspect. Shafto returned to the Asbury Police Department following the surgery and was placed on "medium capacity" until his retirement in July 2010.

Dr. Berman's testimony before the ALJ was consistent with the medical findings he reported to the Medical Review Board. He opined that Shafto was not totally and permanently disabled and consequently unable to carry out his duties as police officer. The ALJ accepted Dr. Berman's testimony as credible. Building on Dr. Berman's opinion, the ALJ found "the injuries supporting a finding of total and permanent disability are no longer present and have 'vanished.'"

Shafto called Dr. Skolnick to rebut Dr. Berman's findings and opinion. The ALJ admitted Dr. Skolnick as an expert in orthopedic surgery. After examining Shafto on January 7, 2013, Dr. Skolnick found he had a noticeable decrease in motion and "normal every day strength." In his opinion, Shafto lacked the normal strength to perform common everyday tasks around the house. Dr. Skolnick testified Shafto had particular difficulty raising his right arm over his head. He opined Shafto would not improve because he lacked the proper muscle fiber.

Dr. Skolnick opined Shafto would not able to fully participate in a physical confrontation with a suspect. In his opinion, Shafto would be compromised in a fight situation while performing his duties. Finally, Dr. Skolnick opined Shafto suffered a permanent injury. On cross-examination, Dr. Skolnick stated he did not expect muscle atrophy in the shoulder because Shafto was using it to his optimum ability under the circumstances. He also diagnosed Shafto as suffering from cervical radiculopathy.

The ALJ found Dr. Skolnick's testimony was limited by his reliance on Shafto's subjective complaints of pain. This was particularly damaging to Dr. Skolnick's testimony because the ALJ found Shafto's testimony not credible. The ALJ noted a number of inconsistencies in Shafto's account of the 2009 altercation. The ALJ also found problematic Shafto's failure to report to the PFRS that he had received two workers' compensation awards related to the two work-related accidents, one in the amount of $27,000 and another in the amount of $14,000. The ALJ noted

He received an accidental disability retirement benefit as well as payments for workers compensation period awards. Shafto did not report them to the PFRS despite the provision in the PFRS award and the testimony of the instructions made by Shafto's worker's compensation attorney at the approval of the settlement that Shafto had the obligation to report the awards to PFRS. Shafto's testimony is not credible because of his presentation. It is understandable why . . . [Dr.] Berman concluded that Shafto exerted sub-minimal efforts on the test that he could control.

Against this factual record, the ALJ applied the standard the Supreme Court adopted in Richardson and concluded Shafto did not meet his burden of proving he "is permanently and totally disabled as a direct result of a traumatic event occurring during and as a result of the performance of his regular or assigned duties" as a police officer. N.J.S.A. 43:16A-7(1). After carefully reviewing the record developed before the ALJ and reviewing his Initial Decision of September 29, 2014, the PFRS Board made its final decision in a letter dated November 1, 2014, sent by Secretary Jamison to Shafto's attorney.

The PFRS Board's decision modified the ALJ's findings with respect to Dr. Berman's testimony and ultimate opinion. In a carefully delineated "bullet-point" presentation, the PFRS Board meticulously reviewed Dr. Berman's physical evaluation of Shafto, including the results of certain tests intended to measure Shafto's arm strength and manual dexterity. The PFRS Board concurred with the ALJ's assessment of Shafto's credibility, highlighting the incongruity of certain material areas of his testimony. The PFRS Board adopted the "ultimate conclusions of law of the ALJ's Initial Decision finding that Mr. Shafto is not totally and permanently disabled from the performance of his job duties as a police officer for the City of Asbury Park."

II

A final determination of the PFRS Board is reviewable only by this court. In re Town of Harrison, 440 N.J. Super. 268, 302 (App. Div. 2015); see also N.J.A.C. 17:4-1.7(e); R. 2:2-3(a)(2). However, the scope of our review is limited. Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J. 14, 27 (2011). We are bound to uphold the PFRS Board's decision "unless there is a clear showing that it is arbitrary, capricious, or unreasonable, or that it lacks fair support in the record." Ibid. (quoting In re Herrmann, 192 N.J. 19, 27-28 (2007)). However, this court is not bound by the Board's "interpretation of a statute or its determination of a strictly legal issue." Ibid. (quoting Mayflower Sec. Co. v. Bureau of Sec., 64 N.J. 85, 93 (1973)).

Shafto, as the appellant and party challenging the PFRS Board's action, has the burden "of demonstrating that the agency's action was arbitrary, capricious or unreasonable[.]" In re Arenas, 385 N.J. Super. 440, 443-44 (App. Div.), certif. denied, 188 N.J. 219 (2006). "[T]he test is not whether an appellate court would come to the same conclusion if the original determination was its to make, but rather whether the factfinder could reasonably so conclude upon the proofs." Brady v. Bd. of Review, 152 N.J. 197, 210 (1997) (quoting Charatan v. Bd. of Review, 200 N.J. Super. 74, 79 (App. Div. 1985)).

The Supreme Court in Richardson held a claimant seeking accidental permanent disability benefits under the PFRS must prove each of the following five elements

1. that he is permanently and totally disabled;

2. as a direct result of a traumatic event that is

a. identifiable as to time and place,

b. undesigned and unexpected, and

c. caused by a circumstance external to the member (not the result of pre-existing disease that is aggravated or accelerated by the work);

3. that the traumatic event occurred during and as a result of the member's regular or assigned duties;

4. that the disability was not the result of the member's willful negligence; [and]

5. that the member is mentally or physically incapacitated from performing his usual or any other duty.

[Richardson, supra, 192 N.J. at 212-13.]

The dispute here is centered on whether Shafto is "permanently and totally disabled" and consequently unable to physically perform his usual duties as a police officer. In this regard, the ALJ found Dr. Berman's testimony more credible and persuasive than the testimony presented by Shafto's physician, Dr. Skolnick. Dr. Berman's testimony established, by a preponderance of the evidence, that Shafto has completely recovered from the injuries he sustained in 2009. According to Dr. Berman, he is no longer eligible to receive accidental disability pension benefits under N.J.S.A. 43:16A-8(2). Shafto did not present objective medical evidence that impugned Dr. Berman's opinion about his physical ability to perform his duties as a police officer.

The PFRS Board also relied on the findings and recommendation of the Medical Review Board. The Supreme Court has recognized the important role the Medical Review Board plays in determining eligibility for accidental disability benefits.

Accidental disability benefits are available to an employee upon written application provided that

the medical board, after a medical examination of such member, shall certify that the member is permanently and totally disabled as a direct result of a traumatic event occurring during and as a result of the performance of his [or her] regular or assigned duties and that such disability was not the result of the member's willful negligence and that such member is mentally or physically [27] incapacitated for the performance of his [or her] usual duty and of any other available duty in the department which his [or her] employer is willing to assign to him [or her].

[Russo, supra, 206 N.J. at 27-28 (quoting N.J.S.A. 43:16A-7(1)).]

Here, the Medical Review Board found Shafto's 2009 traumatic, work-related injury did not meet the criteria established by the Legislature in N.J.S.A. 43:16A-7(1). The medical evidence Shafto presented was duly considered and rejected by the PFRS Board. Based on our standard of review of the PFRS Board's decision, we discern no legal basis to interfere. The ALJ's assessment of Shafto's credibility is also well within his authority as the adjudicative officer charged with the responsibility to make factual findings. Appellant's remaining argument that the ALJ should not have considered evidence of a workers' compensation payment for impeachment purposes is without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).

Affirmed.

1 Dr. Berman was the physician designated by the Medical Review Board to conduct an Independent Medical Evaluation of Shafto pursuant to N.J.A.C. 17:2-6.26.