IN THE MATTER OF HANSEN v. McCALL

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Docket Number

95641

Judges

John A. Lahtinen

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Smart Summary

Factual and Procedural Background

Jacqueline Brottenberg, a bus driver and member of the New York State and Local Employees' Retirement System from 1984 to 1999, was diagnosed with a malignant brain tumor in late 1999. In September 2000, she applied for ordinary disability retirement benefits and postretirement death benefits. At that time, she changed the primary beneficiary designation under both plans from her children to Richard Hansen, with whom she had a romantic relationship since January 1996. Concurrently, she executed a will naming Hansen as executor but bequeathing all property to her children. Brottenberg died in December 2000. The Retirement System initially recognized Hansen as the valid primary beneficiary, but Brottenberg's children requested a hearing, alleging that Brottenberg was mentally incompetent when she changed the beneficiary designations. The Hearing Officer agreed and voided the beneficiary designations naming Hansen, reinstating the children as primary beneficiaries. The State Comptroller upheld this determination, leading to the current CPLR article 78 proceeding to review the Comptroller's decision.

Legal Issues Presented

Whether the Comptroller's determination voiding the decedent's beneficiary designations in favor of petitioner was supported by substantial evidence.
Whether petitioner was denied due process by the refusal to continue the hearing to allow presentation of additional evidence or witnesses.
Whether the decedent's mental incompetency at the time of beneficiary designation was properly established without requiring proof of psychosis.

Arguments of the Parties

Petitioner's Arguments

The decedent was competent when she designated petitioner as beneficiary, and additional evidence and witnesses should have been allowed at the hearing to support this claim.
The Retirement System's counsel should have represented petitioner or assisted in making his case during the hearing.
The children were required to prove that the decedent suffered from psychosis to establish incompetency.

Respondents' Arguments

The decedent was mentally incompetent due to an organic mental defect caused by her illness, as supported by expert medical testimony.
The Comptroller has exclusive authority to determine the validity of beneficiary designations, and that determination is supported by substantial evidence.
Petitioner was informed of his right to counsel and chose to proceed pro se; he waived any right to a hearing continuation by not requesting it or objecting during the hearing.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Matter of Nisnewitz v. Regan, 207 AD2d 605, lv denied 84 NY2d 812	Comptroller's determinations are binding if supported by substantial evidence.	Supported the principle that the Comptroller’s decision here should not be disturbed because it was supported by substantial evidence.
Matter of Boucher v. Regan, 88 AD2d 1066	Same as above regarding the Comptroller's exclusive authority and standard of review.	Reinforced the standard that the Comptroller's determinations are upheld if supported by substantial evidence.
Matter of Harper v. McCall, 277 AD2d 589	Expert medical opinion can provide substantial evidence of incompetency.	Validated reliance on neurologist’s testimony about decedent’s cognitive impairment as substantial evidence.
Ortelere v. Teachers' Retirement Bd. of City of N.Y., 25 NY2d 196	Distinction between psychosis and organic mental defects in assessing incompetency.	Rejected petitioner's argument requiring proof of psychosis, recognizing organic mental defects as sufficient for incompetency.
Matter of Allaway v. Regan, 133 AD2d 962	Due process considerations and the role of counsel in administrative hearings.	Supported the finding that petitioner’s waiver of counsel and failure to request hearing continuation barred his due process claims.
Feiden v. Feiden, 151 AD2d 889; Blatt v. Manhattan Med. Group, 131 AD2d 48	Recognition of organic mental defects as grounds for incompetency.	Supported the legal basis for finding incompetency without psychosis.
Matter of Pentinen v. New York State Employees' Retirement Sys., 60 AD2d 366, lv denied 44 NY2d 647	Clarification that Retirement System counsel does not represent a pro se party.	Used to reject petitioner's claim that the Retirement System's counsel was required to represent him.
Matter of Wallace v. Regan, 105 AD2d 586	Waiver of rights by failure to object or request continuance at hearing.	Supported the conclusion that petitioner waived his right to raise evidentiary objections by failing to act during the hearing.

Court's Reasoning and Analysis

The court recognized the Comptroller’s exclusive authority to determine the validity of beneficiary designations and that such determinations must be upheld if supported by substantial evidence. The court found the testimony of Michael Gruber, the decedent’s treating neurologist, to be credible and sufficient, as he opined that by September 2000 the decedent was cognitively impaired to the extent that she lacked capacity to understand the consequences of any documents, including beneficiary designations. The court rejected the petitioner’s argument that psychosis was required to establish incompetency, clarifying that organic mental defects, such as those suffered by the decedent, are valid bases for such a finding. Procedurally, the court held that petitioner waived any right to additional evidence or witnesses by declining counsel and failing to request a hearing continuation or raise objections during the hearing. The court further emphasized that the Retirement System’s counsel did not represent petitioner and was not obligated to make petitioner’s case. After considering petitioner’s remaining arguments, the court found them without merit and confirmed the Comptroller’s determination.

Holding and Implications

The court confirmed the determination of the State Comptroller, voiding the decedent’s beneficiary designations in favor of petitioner and reinstating her children as the primary beneficiaries.

This decision directly affects the parties by upholding the Comptroller’s authority and the reinstatement of the children as beneficiaries. No new legal precedent was established beyond affirming existing principles regarding the standard of review, mental incompetency standards, and procedural due process rights in administrative hearings.

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In the Matter of RICHARD HANSEN, Petitioner, v. H. CARL McCALL, as State Comptroller, et al., Respondents.

Peters, J. Proceeding pursuant to CPLR article 78 (transferred to this Court by order of the Supreme Court, entered in Albany County) to review a determination of respondent Comptroller which, inter alia, voided decedent's designations of petitioner as option beneficiary and primary death benefit beneficiary.

Jacqueline Brottenberg (hereinafter decedent) was a bus driver for a public school district and a member of the New York State and Local Employees' Retirement System from 1984 to 1999. After being diagnosed with a malignant brain tumor in the fall of 1999, she filed applications for ordinary disability retirement benefits and postretirement death benefits in September 2000. Shortly thereafter, she also changed her primary beneficiary designation under both plans from her children, who had been listed as the primary beneficiaries since April 1996, to petitioner, with whom she had been romantically involved since January 1996. At this time, decedent also executed a will, naming petitioner as her executor and bequeathing all her property and possessions to her children. Decedent succumbed to her illness in December 2000. After the Retirement System informed decedent's children that petitioner appeared to be the valid primary beneficiary of both decedent's ordinary disability retirement benefits and her postretirement death benefits, they requested a hearing and redetermination, alleging that decedent's progressively worsening illness had rendered her mentally incompetent at the time she designated petitioner as the new beneficiary. The Hearing Officer agreed and voided decedent's elections, reinstating her children as the intended primary beneficiaries. Respondent Comptroller upheld the determination and this CPLR article 78 proceeding ensued. We now confirm.

The Comptroller has the exclusive authority to determine the validity of beneficiary designations on applications for disability retirement and death benefits; when his determination is supported by substantial evidence, it may not be disturbed ( see Matter of Nisnewitz v. Regan, 207 AD2d 605, 605, lv denied 84 NY2d 812; Matter of Boucher v. Regan, 88 AD2d 1066, 1067). At the hearing, Michael Gruber, a board-certified neurologist and decedent's treating physician throughout the course of her illness, testified that decedent, in the end stage of her illness by September 2000, was so cognitively impaired as a result that he considered it "highly improbable" that she would have had the mental capacity to comprehend or understand the consequence of "any document," let alone her available retirement and death benefit options. We conclude that Gruber's opinion as to decedent's incompetency, which was based on his frequent examinations of decedent, the history given by decedent's family and his review of her medical records, was sufficiently articulated, rational and fact based and, thus, provides substantial evidence supporting the Comptroller's determination ( see Matter of Harper v. McCall, 277 AD2d 589, 590). In this regard, we reject as misplaced petitioner's assertion that decedent's children were required to demonstrate that she had been afflicted by psychosis, which pertains to mental illnesses and not organic mental defects such as the one suffered by decedent, which may also support a finding of incompetency ( see Ortelere v. Teachers' Retirement Bd. of City of N.Y., 25 NY2d 196, 204; Matter of Allaway v. Regan, 133 AD2d 962, 964; see also Feiden v. Feiden, 151 AD2d 889; Blatt v. Manhattan Med. Group, 131 AD2d 48, 52).

Turning briefly to petitioner's procedural points of error, we find unpersuasive his due process claims that the Retirement System was required to continue the hearing in order to present additional witnesses and evidence that would support petitioner's argument that decedent was not incompetent. Prior to the start of the hearing, the Hearing Officer carefully and thoroughly informed petitioner that counsel for the Retirement System did not represent him, and further advised that he should obtain his own legal representation for the proceedings. Petitioner declined, indicating his desire to proceed pro se. Counsel for the Retirement System, who aggressively opposed the application of decedent's children to set aside the designations, was not petitioner's personal representative and was not required to make his case for him ( see e.g. Matter of Allaway v. Regan, supra at 964; Matter of Pentinen v. New York State Employees' Retirement Sys., 60 AD2d 366, 369, lv denied 44 NY2d 647); moreover, nothing prevented petitioner from requesting a continuation of the hearing for the purpose of either obtaining counsel or offering the evidence he now claims should have been considered. As he failed to do so and, indeed, raised no evidentiary objections at all during the hearing, we find that petitioner has waived his right to assert these claims ( see Matter of Wallace v. Regan, 105 AD2d 586, 587). Petitioner's remaining arguments have been considered and rejected as lacking in merit.

Adjudged that the determination is confirmed, without costs, and petition dismissed.