Appeal from the Order of the Public School Employees' Retirement Board in the case of In Re: Ruth W. Burlingame (Deceased), S.S. No. 207-26-0120.
Harold G. Caldwell, Vineski, Brann, Williams, Caldwell & Mott, for petitioner.
Richard D. Michlovitz, for respondent.
Judges Craig, Doyle and Palladino, sitting as a panel of three. President Judge Crumlish, Jr., and Judges Craig, Doyle, Barry, Colins, McGinley and Smith. Opinion by Judge Craig. Dissenting Opinion by Judge Doyle. Judge McGinley joins in this dissent.
[ 125 Pa. Commw. Page 179]
Before us is an appeal by the Estate of Ruth W. Burlingame (Estate) from an order of the Public School Employees' Retirement Board which denied the request of Amelia Wells, Executrix of the Estate, and Jarvis and Cecelia Burlingame for death benefits.*fn1 The board also denied the Estate's petition to reopen the record.
The board made the following pertinent findings. Mrs. Burlingame was a member of the Pennsylvania State Employees' Retirement System (System) and had thirty-nine years of service with the System at the time of her retirement on June 18, 1976. At various times before her retirement Mrs. Burlingame had written to the System advising it that she wished to change the beneficiary of her accumulated deductions, and each time she was
[ 125 Pa. Commw. Page 180]
provided with the form which she then completed for that purpose. When she retired, she selected an option (Option 2) under which she would receive a lower monthly retirement payment than under other options, but upon her death the same benefits would then be payable to her survivor annuitant (she nominated her husband as her survivor annuitant). The application for retirement which she received and completed at the time of her retirement advised her that if her "beneficiary" predeceased her, she would have one year to "elect a new beneficiary" and that her monthly allowance would then be recomputed based upon her age and the age and sex of the new beneficiary. Mrs. Burlingame's application was processed and she began to receive benefits. Her husband, who died on May 28, 1984, predeceased her by about six weeks.
As of May of 1984 and up until her death, Mrs. Burlingame's health was failing. She was, however, lucid. During that time Cecelia moved in to care for her. Mrs. Burlingame told Cecelia that she intended to nominate Cecelia and Jarvis, Cecelia's brother, as her new beneficiaries. Mrs. Burlingame, who was their aunt and step-grandmother by marriage as well, secured a change of beneficiary form through communications with a former retirement counselor; the board found that there was no evidence that the form was mailed from the System. Mrs. Burlingame directed Jarvis' wife to complete the form. The board found that Mrs. Burlingame did not know that she would be required to elect one of the System's options to effectuate her intent in addition to completing the form, nor was she aware that such re-election would reduce her monthly annuity.
The nomination of beneficiary form was received by the System on June 28, 1984. On June 29, an employee of the System called Mrs. Burlingame and during the conversation Mrs. Burlingame learned that only one option
[ 125 Pa. Commw. Page 181]
would benefit Cecelia and Jarvis. On July 11, the System forwarded to Mrs. Burlingame (1) the nomination of beneficiary form she had completed and dated June 25, 1984, (2) an option designation form, and (3) a new nomination of beneficiary form and the letter which explained the various options to her.
28. The following options were open to Mrs. Burlingame: 'Maximum Option', 'Option 1', 'Option 2', 'Option 3' and 'Special Option'.
29. The 'Special Option' would permit Mrs. Burlingame to develop and individualize a tailor-made plan to effectuate her intentions with the assistance of the System's actuary. This plan could include two or more beneficiaries or survivor annuitants.
30. Under the Maximum Option, Mrs. Burlingame would simply continue to receive the same monthly benefit she had been receiving but would not be able to provide a substantial death benefit for her designated beneficiaries.
31. Under Option 2 Mrs. Burlingame would be able to name one survivor annuitant, subject to certain actuarial restrictions. Mrs. Burlingame would receive a reduced annuity for her life and her survivor annuitant would receive the same amount for the survivor annuitant's life after Mrs. Burlingame's death. The actuarial restrictions would prevent Mrs. Burlingame from reelecting Option 2 in July of 1984 and naming Jarvis or Cecelia survivor annuitant.
32. Under Option 3, Mrs. Burlingame would be able to name one survivor annuitant, subject to certain actuarial ...