In a case of first impression in New Jersey, the Superior Court, Appellate Division ruled that a retired teacher could not be disqualified from his deferred retirement benefit as a result of a guilty plea to a bank fraud charge which pre-dated his employment. Our client, J, committed bank fraud as a young man and received a probationary sentence. He left the banking industry and was hired by a local school district where he worked for eleven years and enjoyed excellent performance reviews. In the eleventh year of his employment, the Department of Education revoked J’s teaching certificate. As a result, the school district fired him concluding that he was not qualified to each because of the absence of the certificate.
When J reached the age of retirement, he applied for a deferred retirement benefit. The Teacher’s Pension and Annuity Fund (TPAF) ruled that J was disqualified from the benefit because of his earlier guilty plea. In the view of the TPAF, J was ineligible for deferred retirement benefits because his involuntary separation from service was a removal for conduct unbecoming a teacher. J retained Arnold Lakind who filed an appeal with the Superior Court, Appellate Division.
On appeal, Arnold acknowledged that there was no case arising under the TPAF statutory scheme that addressed a teacher’s entitlement to deferred retirement benefits after having plead guilty to a crime that occurred prior to the hiring date. However, courts had ruled, in other pension settings, that pre-employment conduct could not be the basis for forfeiture of a retirement benefit. According to Arnold, the pension statute did not require forfeiture and to impose forfeiture would be tantamount to an enhanced criminal penalty. Because the criminal charge was unrelated to J’s teaching, it was, Arnold argued, improper to require that J forfeit his pension. The Attorney General argued that teachers must be held to the highest standard of conduct and the timing of the criminal charges was irrelevant. In a unanimous decision, the Appellate Division agreed with Arnold, adopted our arguments, and awarded our elderly client his deferred retirement benefit.
