Estate of Wilson Ex Rel. Killinger v. State Employees' Retirement Board
177 A.3d 1020
| Pa. Commw. Ct. | 2017Background
- Lynn D. Wilson retired in 1997 under Option 2 (joint-and-survivor annuity) naming his wife as survivor annuitant; Option 2 provides a lifetime annuity to a living designated survivor and does not provide a separate lump-sum beneficiary payment.
- Wilson’s wife (the designated survivor annuitant) died November 27, 2011.
- SERS sent Wilson an option-change packet (including an Application for Option Change and a Beneficiary Nomination) on May 22, 2012, stating any change would be effective on the date SERS receives the completed forms.
- Wilson signed and dated the option-change form and beneficiary nomination on June 1, 2012, and mailed them; he died June 9, 2012. SERS received the forms on June 13, 2012 (before SERS received notice of his death).
- SERS recalculated Wilson’s retirement to Option 1 after receiving the forms, but later refused to honor the change once SERS received notice of Wilson’s death, concluding the forms were ineffective because SERS did not receive them before Wilson’s death. The Estate appealed through administrative channels and to this Court.
Issues
| Issue | Claimant's Argument | SERS/Board's Argument | Held |
|---|---|---|---|
| Whether Wilson’s option-change and beneficiary nomination should take effect where he executed and mailed the forms before death but SERS did not receive them until after his death | Wilson/Claimant: completed, signed, and mailed forms before death; SERS actually received them (and initially processed the change) so the change should be effective and beneficiaries paid | SERS/Board: forms were not effective because receipt by SERS occurred after Wilson’s death; GRAPP (§31.11) and case law support requiring actual receipt to be timely | Court: reversed Board — because no statutory deadline ties effectiveness to pre-death receipt and SERS’s own communication said change effective upon receipt; completed designation received by SERS controlled and change was effective |
| Whether Wilson’s retirement should vest in the Estate if option change is not accepted | Estate: if option change not accepted, contend retirement interest should vest in Estate (alternative argument) | SERS/Board: maintained change invalid so no benefit payable under original Option 2 | Court: moot because it found the option change effective; vested-interest issue unnecessary |
Key Cases Cited
- Harasty v. Pub. Sch. Emps.’ Ret. Bd., 945 A.2d 783 (Pa. Cmwlth. 2008) (mailbox rule rejected where statute imposed a filing deadline and agency receipt date controlled)
- Hess v. Pub. Sch. Emps.’ Ret. Bd., 460 A.2d 1231 (Pa. Cmwlth. 1983) (distinguishing unsigned or unfiled beneficiary nominations from properly executed filings)
- Sandusky v. Pa. State Emps.’ Ret. Bd., 127 A.3d 34 (Pa. Cmwlth. 2015) (scope of review for administrative adjudications)