Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

ORTIZ v. REGAN

August 1, 1991

BERNICE ORTIZ, PLAINTIFF,
v.
EDWARD V. REGAN, AS COMPTROLLER OF THE STATE OF NEW YORK AND AS TRUSTEE OF THE NEW YORK STATE AND LOCAL RETIREMENT SYSTEMS, THE NEW YORK STATE AND LOCAL RETIREMENT SYSTEMS, GREGORY O. CHILDS, PERSONALLY AND AS DIRECTOR, RETIREMENT BENEFITS OF THE NEW YORK STATE AND LOCAL RETIREMENT SYSTEMS, AND JANE A. O'CONNOR, PERSONALLY AND AS ASSISTANT DIRECTOR OF THE RETIREMENT BENEFITS BUREAU OF THE NEW YORK STATE AND LOCAL RETIREMENT SYSTEMS, DEFENDANTS.



The opinion of the court was delivered by: Mukasey, District Judge.

OPINION AND ORDER

Plaintiff Bernice Ortiz is a New York State and Local Retirement Systems (NYSLRS) pensioner who claims that she was born November 7, 1925 and is entitled to a pension based on that birth date. Even though NYSLRS had apparently resolved a discrepancy in their file and accepted the correctness of the 1925 birth date before she retired, the agency suspended her benefits in September 1989 on the supposition that her actual birth date was September 10, 1932. After NYSLRS failed to pay any retirement benefits for over five months, plaintiff's pension ultimately was restored, but at an amount based on the 1932 birth date.

In this action, under 42 U.S.C. § 1983, she claims that defendants NYSLRS and Edward V. Regan have deprived and continue to deprive her of property without due process of law by arbitrarily suspending and later reducing her monthly retirement benefits without notice and without an opportunity to challenge the action. Plaintiff also alleges that the failure of NYSLRS and Regan to adopt rules and regulations to prevent the wrongful termination or reduction of retirement benefits has deprived and will continue to deprive her of property without due process of law. Finally, Ortiz alleges that NYSLRS and Regan breached their fiduciary duties and violated her state constitutional rights and that defendants Childs and O'Connor violated her rights under the state and federal constitutions in their personal capacities. In her prayer for relief, plaintiff seeks an injunction ordering defendants to pay benefits based on the 1925 birth date, a money judgment for all back benefits that she should have received along with interest, punitive damages against Childs and O'Connor, and attorney's fees.

In an earlier opinion and order, I denied defendants' motion to dismiss the complaint and held that plaintiff stated a claim under § 1983 when she alleged that defendants violated her procedural due process rights by suspending her advance retirement benefits without notice or a hearing. Ortiz v. Regan, 749 F. Supp. 1254 (S.D.N.Y. 1990). I found also that the notice sent to plaintiff in February 1990 — when her pension was restored and she began to receive regular retirement benefits — was constitutionally defective in that it failed to inform her of the basis upon which her regular benefit was calculated and the availability of an administrative procedure to challenge the calculation. Id. at 1263. Accordingly, I rejected defendants' argument that the only process due Ortiz was an administrative hearing under New York State Retirement & Social Security Law § 74(d) (McKinney's 1987) within four months of the date she began receiving regular retirement benefits. Id. Plaintiff now moves for summary judgment. As set forth below, the motion is granted.

I.

Defendants do not challenge plaintiff's allegation that her benefits were suspended without any pre-deprivation hearing. See Plaintiff's 3(g) Statement ¶¶ 10-12; Defendants' 3(g) Statement. Rather, the only material issue of fact raised by their submissions is whether Ortiz's actual birth date was September 10, 1932 or November 7, 1925. That factual dispute is irrelevant to plaintiff's procedural due process claim and ignores the substance of the earlier opinion in this case. The federal issue in this case is not the date of Ortiz's birth, but the process, or lack thereof, by which defendants suspended her advance retirement benefits in September 1989 without providing any prior notice or opportunity to respond. Although defendants may deny Ortiz benefits to which she is not entitled, they may not suspend or reduce benefits she is already receiving without providing a constitutionally adequate pre-deprivation hearing. See Zinermon v. Burch, 494 U.S. 113, 110 S.Ct. 975, 984, 108 L.Ed.2d 100 (1990); Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976).

As explained in my earlier opinion and order, Ortiz was constitutionally entitled at least to minimal notice and opportunity to respond when officials at NYSLRS decided to suspend her monthly advance retirement benefits. When Ortiz retired in May 1989, she was under the impression that NYSLRS had resolved in her favor a discrepancy between the birth date that she had provided in her original application for membership in the pension plan — September 10, 1932 — and documentary evidence that she provided to NYSLRS shortly before retiring in which she indicated that her birth date was actually November 7, 1925. The advance retirement benefits, which Ortiz began receiving in June 1989, were intended to provide, as stated in a letter that accompanied the first advance, "monthly. . . . income during the period required to compile all the data necessary to accurately compute" the regular retirement benefit to which she was entitled. Complaint Exh. E.

The incident that apparently prompted the suspension of these monthly advances was NYSLRS's receipt of a letter in August 1989, purportedly from Ortiz, informing the agency that her birth date was September 10, 1932. Ortiz alleges that her landlord forged that letter in an effort to harass her and force her to vacate her rent-controlled apartment. Complaint ¶ 38. NYSLRS also had received a letter in July 1989 in which a "Mr. Romanovsky," a "Concerned Citizen," alleged that Ortiz was "ripping off the Retirement Plan" and had impersonated a relative in order to misrepresent her birth date. Childs Aff., Exh. 10. Another "concerned citizen," possibly the same person, anonymously repeated similar allegations in a letter sent to NYSLRS in November 1989. Childs Aff., Exh. 18.

Upon receiving the July and August 1989 letters, NYSLRS officials decided to suspend plaintiff's advance retirement benefits pending an investigation. However, prior to the suspension, defendants failed to provide plaintiff with notice or any opportunity to challenge the proposed action or respond to the allegations made against her. In fact, Ortiz learned that her benefits had been suspended only after the expected September 1989 check failed to arrive and only after she herself contacted NYSLRS for an explanation and was given, as she wrote later, the "run-around" from NYSLRS employees. I might add that the initial explanation was, simply, that NYSLRS stopped her benefits intentionally; it took her own letter to a NYSLRS official for Ortiz to learn — in October — that her benefits had been stopped because of a discrepancy as to her birth date.

As discussed in my earlier opinion and order, Ortiz spent the next five months attempting to comply with defendants' confusing and contradictory requests for documentation of her birth date. However, she received no benefits during that period. Meanwhile, although Ortiz requested a copy of the August 1989 letter in October, NYSLRS did not provide a copy until January 1990, and only after she repeated her earlier request. Finally, on February 9, 1990, Ortiz received her first "monthly" advance retirement benefit since August 1989. One week later she began receiving regular monthly retirement benefits, albeit based on the 1932 birth date. It is unclear from the parties' submissions whether Ortiz ever received a copy of the July 1989 letter in which a "concerned citizen" essentially accused her of defrauding NYSLRS — or whether she was even aware of its existence — until she commenced her suit in February 1990.

Defendants have not denied that they failed to provide plaintiff with notice or any opportunity to respond to their confusion about her birth date before they suspended her advance retirement benefits. Significantly, defendants chose to cut off all benefits without notice and without explanation even though her entitlement to some retirement benefit was never in doubt and even though the difference between the monthly advance retirement benefit and the monthly regular benefit which NYSLRS eventually calculated using the 1932 birth date amounted to only $1.01 per month. "The opportunity to present reasons, either in person or in writing, why proposed action should not be taken is a fundamental due process requirement." Cleveland Bd. of Education v. Loudermill, 470 U.S. 532, 546, 105 S.Ct. 1487, 1495, 84 L.Ed.2d 494 (1985).

As I stated in my earlier opinion and order, plaintiff "got far less than due process; she got virtually no process, and the process she did get was . . . a run-around." 749 F. Supp. at 1260. Defendants contend that it was permissible to "suspend" plaintiff's advance retirement benefits because she failed to comply with "Retirement System policy concerning proof of date of birth," Childs Aff. ¶ 20, and also because her retirement application contained a statement that "Proof of your date of birth is required before a benefit can be paid." Childs Aff., Exh. 9. However, that argument provides only a possible ground for denying regular benefits based upon the 1925 birth date, not for terminating, completely and without notice or opportunity to respond, advance retirement benefits she was already receiving. Because defendants have not "set forth specific facts showing that there is a genuine issue for trial," plaintiff is entitled to judgment as a matter of law on her federal procedural due process claims. Fed.R.Civ.P. 56(e). Accordingly, her motion for summary judgment is granted on the issue of liability.

II.

Having determined that defendants violated plaintiff's rights to procedural due process, I must now formulate an appropriate remedy. Under Carey v. Piphus, 435 U.S. 247, 266, 98 S.Ct. 1042, 1053, 55 L.Ed.2d 252 (1978), a plaintiff who is deprived of liberty or property without due process of law is entitled to nominal damages even if the deprivation was justified. "`It is enough to invoke the procedural safeguards of the Fourteenth Amendment that a significant property interest is at stake, whatever the ultimate outcome of a hearing.'" Id. (quoting Fuentes v. Shevin, 407 U.S. 67, 87, 92 S.Ct. 1983, 1997, 32 L.Ed.2d 556 (1972)). However, to the extent a deprivation was justified, a plaintiff normally cannot recover any compensatory damages from the mere fact that constitutional rights were violated. 435 U.S. at 262-63, 98 S.Ct. at 1051-52. In Carey, the Supreme Court held that students who had been suspended from school without a hearing could receive only nominal damages, not to exceed one dollar, if the district court determined on remand that they would have been suspended even if their procedural due process rights had not been violated. Id. at 267, 98 S.Ct. at 1054. Although the Court acknowledged that mental and emotional distress were compensable harms under § 1983 — provided that the plaintiff "convince[d] the trier of fact that he actually suffered distress because of the denial of procedural due process itself," id. at 263, 98 S.Ct. at 1052 — such damages are not at issue in this case because the only compensatory damages Ortiz seeks in her complaint are ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.