Employees' Retirement System v. Dorsey

BARBERA, J. Baltimore City Code (2012), Article 22, § 9(j) 1 lays out the eligibility requirements for certain employees of the City of Baltimore to receive line-of-duty disability retirement benefits. 2 That section requires a claimant seeking such benefits to prove that he or she sustained at least a “50% anatomical loss of the use of any 1 or at least a 25% or more anatomical loss of each of 2 or more” enumerated body parts. § 9(j)(5)(ii), (iii). The loss of use must be ¹⁰⁴ the direct result of bodily injury through an accident independent of all other causes and independent of any preexisting physical or medical conditions, job-related or otherwise, occurring while in the actual performance of duty with the City at a definite time and place, without willful negligence on the part of the member. § 9(j)(l)(ii)(emphasis added). Respondent, Sylvester Dorsey, was injured while performing his job as a school police officer in Baltimore City. Following the City’s termination of his employment, Respondent applied for line-of-duty disability retirement with Petitioner, the Employees’ Retirement System (“ERS”) of the City of Baltimore.

A hearing examiner found that Respondent had a 25% impairment to his right arm and a 25% impairment to his back as a result of the work injury, and an additional 15% impairment to his back due to degenerative disc disease that was asymptomatic prior to the injury but became symptomatic following the injury. The hearing examiner denied the application for line-of-duty disability retirement. The hearing examiner concluded that Respondent did not satisfy the statutory requirements because “the impairment to [Respondent’s] back is not independent of all other causes.” The hearing examiner reasoned that Respondent’s degenerative disc disease “contribute^]” to the disability of his back. Respondent sought judicial review of the hearing examiner’s decision, and the Circuit Court for Baltimore City reversed in Respondent’s favor.

The Court of Special Appeals affirmed the judgment of the Circuit Court. Employees’ Ret. Sys. v. Dorsey, 203 Md.App. 304 , 37 A.3d 1064 (2012). We granted the petition of the ERS to determine whether Respondent’s preexisting condition precludes him from qualifying for line-of-duty disability retirement on the grounds that his impairment is not entirely independent of any preexisting physical or medical conditions.

For reasons we shall explain, Respondent’s preexisting condition does not preclude him from qualifying for line-of-duty disability retirement because he proved ¹⁰⁵ that 50% of his total level of disability 3 is the direct result of the injury he sustained while performing in the line of duty. We therefore affirm the judgment of the Court of Special Appeals. I. Respondent began his employment with the City of Baltimore as a school police officer in August 2005. While on-duty on August 31, 2007, Respondent was involved in a violent altercation with a student’s parent.

During that incident, Respondent injured his lower back. A few weeks after that event Respondent returned to light work duty. He was unable, however, ever to return to full work duty. On January 17, 2009, the City of Baltimore terminated Respondent’s employment.

Respondent subsequently filed an application for line-of-duty disability retirement. On July 12, 2010, a hearing examiner conducted a hearing on the claim, during which Respondent testified and numerous medical and other records were submitted into evidence. Respondent testified that following the August 2007 incident he developed “a real sharp constant pain down the back of the right leg into the foot.” Respondent described having “weakness in the leg” causing his knee to “bucklef ] constantly.” He also had difficulty walking up and down stairs. On one occasion, Respondent fell down the stairs after his legs “gave out.” Respondent separated his right shoulder as the result of that fall.

He testified that as the result of the shoulder injury he suffered pain and had difficulty lifting, pushing and pulling. He also experienced constant pain in his back. Respondent’s treatment records disclose that prior to the hearing five MRIs were taken of his back; he received a series of steroid injections; and a nerve conduction study and decompression surgery were performed. Respondent was ¹⁰⁶ evaluated and/or treated by a number of physicians during the period between the August 31, 2007 incident and the July 2010 hearing on his claim for line-of-duty disability retirement.

Several evaluating and treating physicians noted asymptomatic degenerative disc disease pre-dating the August 2007 injury. At least two of them opined about the degree to which that preexisting back condition affected Respondent’s then-current level of disability. Dr. Jeffrey Gaber opined in April 2010 that Respondent had a 60% “anatomical loss to the lumbar spine, all due to the injury that occurred on August 31, 2007.” Dr. Friedler noted in June 2010 that Respondent’s back was 35% disabled, “of which 15% is preexisting.” Section 9(j) addresses the line-of-duty disability retirement benefit. That section requires the claimant to comply with the application process and filing deadline and further requires the hearing examiner to determine that the claimant is “permanently incapacitated for the further performance of the duties of his or her job classification in the employ of the City due to one or more of the impairments” listed in § 9(j)(5)(iii) (e.g., “back” and “arm”).

See § 9(j)(l)(i), (2). The claimant also must prove that he or she sustained “50% anatomical loss of the use of any 1 or at least a 25% or more anatomical loss of each of 2 or more” of the body parts listed in subsection 9(j)(5)(iii), see § 9(j)(5)(ii), “as the direct result of bodily injury through an accident independent of all other causes and independent of any preexisting physical or medical conditions, job-related or otherwise,” see § 9(j)(l)(ii). See also § 9(p)(ll)(iv) (providing that the hearing examiner shall determine “generally, whether the member’s disability qualifies under § 9(j) of this article,” and “specifically, whether the member’s disability is, independent of any preexisting physical or medical condition, job-related or otherwise, the direct result of a bodily injury arising through an accident that occurred ... while in the actual performance of duty at some definite time and place”). 4 The claimant has the burden to prove by a ¹⁰⁷ preponderance of the evidence that he or she, among other things, “meets all of the eligibility requirements set by law for the applicable benefit.” § 9(p)(10)(i). The hearing examiner found that Respondent filed timely his application for line-of-duty disability retirement and proved by a preponderance of the evidence that “he is permanently incapacitated from performing the duties of his job classification.” The hearing examiner further found that Respondent proved by a preponderance of the evidence that he had injured his back during the August 2007 assault, which occurred while he was performing his job duties in school.

The hearing examiner resolved the conflict among those physicians who had opined about the extent to which Respondent’s preexisting degenerative disc disease affected his present disability, by finding that Respondent sustained a “40% disability to the back, with 15% of his impairment caused by the pre-existing condition and 25% due to the assault of 8/31/07.” The hearing examiner also found that Respondent suffered a “25% impairment to his back and 25% impairment to his right arm due to the assault which occurred in the line of duty on 8/31/07.” The hearing examiner concluded nonetheless that Respondent was not entitled to the line-of-duty disability retirement benefit. The hearing examiner reasoned: The statute does not say the Claimant must be free of any pre-existing condition, what the statute actually says is “the impairment” must be independent of any pre-existing physical or medical condition. The question is whether the pre ¹⁰⁸ existing condition is contributory to the impairment. I conclude that the preponderance of the evidence is that the pre-existing lumbar degeneration does in fact contribute to the current impairment. [T]he impairment to Mr. Dorsey’s back is not independent of all other causes.

The evidence is clear that the preexisting degenerative disc disease in his back contributes to Mr. Dorsey’s disability and without it Mr. Dorsey would not be as disabled as he currently is. Consequently, the hearing examiner denied Respondent’s application for line-of-duty disability retirement on the ground that he “does not meet the statutory requirements set forth in the City Code.” Respondent filed in the Circuit Court for Baltimore City a petition for judicial review of the hearing examiner’s decision. At the hearing on the petition, Respondent argued that the hearing officer had made an error of law by misconstruing § 9(j)(l)(ii). According to Respondent, that provision allows for preexisting conditions and requires only that the claimant prove, as the hearing officer found he had proved, that he suffered at least 50% total impairment (25% impairment of the back and 25% impairment of the right arm) as the direct result of a line-of-duty accident.

Counsel for the ERS countered that the evidence supported the hearing officer’s decision, which counsel characterized as a finding that “if [Respondent] didn’t have that preexisting [condition] he wouldn’t be disabled.” The Circuit Court agreed with Respondent that the hearing officer had made an error of law in concluding that Respondent was not entitled to line-of-duty disability retirement, because the hearing officer’s findings of “25 percent impairment to his back and 25 percent impairment to his shoulder” satisfy the eligibility requirements of § 9(j). The ERS noted an appeal to the Court of Special Appeals, which affirmed in pertinent part the judgment of the Circuit ¹⁰⁹ Court. 5 Dorsey, 203 Md.App. at 321 , 37 A.3d 1064 . The Court of Special Appeals held that the hearing examiner’s decision was premised on an erroneous conclusion of law, specifically, a misreading of the ordinance: The hearing examiner in this case erred in finding that a claimant with a preexisting condition that contributes to an impairment in any way may not recover line-of-duty disability retirement benefits. Although the percentage of the impairment that is due to the preexisting condition does not count in calculating the percentage threshold required [under § 9(j)(l)(ii) ] to qualify for disability, a preexisting condition does not completely disqualify a claimant from the [line-of-duty] disability if he or she otherwise meets the statutory requirements.

Id. at 315, 317, 37 A.3d 1064 . The Court of Special Appeals noted the hearing examiner’s findings that Respondent suffered a “25% impairment to the back and a 25% impairment to his arm due to the assault which occurred in the line of duty on 8/31/07.” Id. at 318-19 , 37 A.3d 1064 . Based on that finding, the Court of Special Appeals held: “This portion of Mr. Dorsey’s disability, which met the statutory requirements, was independent of his preexisting condition and satisfied the requirements of the statute. That there was some additional disability due to a preexisting condition did not preclude Mr. Dorsey from receiving [line-of-duty] disability benefits.” Id. at 319 , 37 A.3d 1064 .

We granted the petition of the ERS for a writ of certiorari, Employees’ Ret. Sys. v. Dorsey, 427 Md. 62 , 46 A.3d 404 (2012), to answer the following questions: ¹¹⁰ 1. Can the requirement in the City’s retirement law that an employee’s impairment must be “independent of any preexisting physical or medical condition, whether job-related or otherwise,” be satisfied when the impairment is caused in part by a preexisting medical condition? 2. Did the lower court err in deciding that Mr. Dorsey was qualified for line-of-duty disability retirement, when his impairment was the result of an asymptomatic, preexisting medical condition that was made symptomatic by a work-related injury?

II

This case comes to us on judicial review of the decision of the ERS, an administrative agency of Baltimore City. The rules by which we undertake such review are well-known. Each reviewing court must “look through” the judgments of the preceding reviewing courts, and examine the agency’s decision. The reviewing court’s role is narrow, as “it is limited to determining if there is substantial evidence in the record as a whole to support the agency’s findings and conclusions, and to determine if the administrative decision is premised upon an erroneous conclusion of law.” Maryland Aviation Admin. v. Noland, 386 Md. 556, 571 , 873 A.2d 1145 (2005) (quoting Bd. of Physician Quality Assurance v. Banks, 354 Md. 59, 67-69 , 729 A.2d 376 (1999)) (internal quotation mark omitted).

In applying the test for substantial °evidence, the reviewing court “decides whether a reasoning mind reasonably could have reached the factual conclusion the agency reached.” Id. (internal quotation mark omitted). The reviewing court defers to the agency’s factual findings, if supported by the record. Id.

The reviewing court, moreover, “must review the agency’s decision in the light most favorable to it; ... the agency’s decision is prima facie correct and presumed valid, and ... it is the agency’s province to resolve conflicting evidence and to draw inferences from that evidence.” Id. (alteration in original) (internal quotation mark omitted). ¹¹¹ With respect to the agency’s conclusions of law, a certain amount of deference may be afforded when the agency is interpreting or applying the statute the agency itself administers. Dep’t of Human Resources v. Hayward, 426 Md. 638, 650 , 45 A.3d 224 (2012) (quoting Marzullo v. Kahl, 366 Md. 158, 172 , 783 A.2d 169 (2001)); Dep’t of Natural Resources v. Heller, 391 Md. 148, 166 , 892 A.2d 497 (2006). “We are under no constraint, however, ‘to affirm an agency decision premised solely upon an erroneous conclusion of law.’ ” Thomas v. State Ret. & Pension Sys., 420 Md. 45, 54-55 , 21 A.3d 1042 (2011) (quoting Ins. Comm’r v. Engelman, 345 Md. 402, 411 , 692 A.2d 474 (1997)); see Marsheck v. Board of Trustees of the Fire & Police Employees’ Ret.

Sys., 358 Md. 393, 402 , 749 A.2d 774 (2000). Section 9(p)(12)(iii) reflects these principles of judicial review, providing that “Ltjhe determination of the hearing examiner is presumptively correct and may not be disturbed on review unless it is arbitrary, illegal, capricious, or discriminatory.” 6 Neither party to the present case challenges the hearing examiner’s finding concerning the percentage of Respondent’s post-August 2007 disability directly attributable to the August 2007 injury — “25% impairment to his back and 25% impairment to his right arm.” Nor do the parties dispute the hearing examiner’s finding that Respondent suffered “40% disability to the back, with 15% of his impairment caused by the pre-existing condition and 25% due to the assault of 8/31/07.” The parties also have no quarrel with the meaning (and application to the facts here) of the requirement describing the extent of disability required in order to qualify for the ¹¹² benefit. See § 9(j)(5) (“For line-of-duty disability retirement benefits awarded on or after April 1, 2001, a 50% anatomical loss of the use of any 1 or a 25% or more anatomical loss of each of 2 or more of the impairments listed in subparagraph (in),” which includes the back and the arm.). The parties’ disagreement focuses instead on the legal correctness of the hearing examiner’s ultimate conclusion that Respondent had not proved the percentage of impairment necessary to show entitlement to line-of-duty disability retirement.

Notwithstanding the phrasing of the questions the ERS presents for our review, it is clear that resolution of those questions requires us to determine whether the hearing officer’s ultimate conclusion was based on an erroneous conclusion of law. In resolving that legal question, we owe the hearing examiner no deference. At issue is the proper construction of § 9(j)(l)(ii), specifically the language requiring the claimant to prove that he or she sustained at least a 50% disability to one enumerated body part, or at least a 25% disability to each of two or more enumerated body parts, “as the direct result of bodily injury through an accident independent of all other causes and independent of any preexisting physical or medical conditions.” (Emphasis added.) See also § 9(p)(ll)(iv), supra. We must decide whether the requirement that the disability sustained in the line of duty be “independent” of any preexisting condition affects the calculation of the disability directly resulting from the claimant’s line-of-duty injury.

To resolve that purely legal question, we rely upon the rules of statutory interpretation. The cardinal rule of statutory interpretation is to ascertain and effectuate the real and actual intent of the Legislature. A court’s primary goal in interpreting statutory language is to discern the legislative purpose, the ends to be accomplished, or the evils to be remedied by the statutory provision under scrutiny. ¹¹³ Gardner v. State, 420 Md. 1, 8 , 20 A.3d 801 (2011)(quoting State v. Johnson, 415 Md. 413, 421 , 2 A.3d 368 (2010) (internal quotation