Reed v. Railroad Retirement Board

145 F.3d 373, 330 U.S. App. D.C. 246, 1998 U.S. App. LEXIS 11919, 1998 WL 295627
CourtCourt of Appeals for the D.C. Circuit
DecidedJune 9, 1998
Docket97-1610
StatusPublished
Cited by8 cases

This text of 145 F.3d 373 (Reed v. Railroad Retirement Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reed v. Railroad Retirement Board, 145 F.3d 373, 330 U.S. App. D.C. 246, 1998 U.S. App. LEXIS 11919, 1998 WL 295627 (D.C. Cir. 1998).

Opinion

PER CURIAM:

Former Conrail President Stuart M. Reed petitions for , review of a decision by the Railroad Retirement Board declaring him ineligible for railroad retirement benefits. We deny the petition because substantial evidence supports the Board’s determination that Reed terminated his employment with Conrail more than a year short of the ten years necessary to qualify for such benefits.

Under section 2(a)(1) of the Railroad Retirement Act, an individual must have “ten years of service” to be eligible for retirement benefits. 45 U.S.C. § 231a(a)(l). Section 3(i)(4) of the Act provides that “an individual shall not be deemed ... to have rendered service for compensation' in any month in which such individual was [not] in an employment relation to one or more [covered] employers....” .45 U.S.C. § 231b(i)(4). And section 204.5 of the Board’s regulations provides that “an employment relation ... ceases after an individual has resigned or relinquished his or her rights to return to the service of [the] employer.” 20 C.F.R § 204:5.

On December 30, 1987, Reed entered into an agreement under which he resigned effective the next day as President, Chief Operating Officer, and Director of Conrail. Pursuant to the agreement, Conrail agreed to pay Reed $1.2 million in exchange for a general release of Reed’s claims against the railroad, and also agreed that Reed would participate in Conrail’s Management Incentive Compensation Plan “for the calendar year 1987, ... with the amount and timing of any bonus to be received by Mr. Reed thereunder to be determined in accordance with the terms of that Plan.” Conrail paid Reed $1,288,763 in 1988 and $75,115 in 1989. The payments were administered through Conrail’s payroll *375 system, and Conrail sent Reed IRS Form W-2 wage and tax statements for those years.

The Board held that the December 1987 agreement terminated Reed’s employment relationship with Conrail, and that the subsequent payments were the separation allowances contemplated by the agreement. Reed contends that although he resigned as President, Chief Operating Officer, and Director, he remained an “employee”; that the payments were for “holding himself available” to advise Conrail in 1988 and 1989; and that those years should therefore be counted toward the ten-year requirement.

This is Mr. Reed’s second trip to this court. We granted his previous petition for review and remanded to the Board to explain how its conclusion that Reed had terminated his employment in December 1987 was consistent with the fact that the payments he received over the next two years were distributed through Conrail’s payroll system. See Reed v. Railroad Retirement Bd., 107 f.3d 923 (D.C.Cir.1997). Remand was required because the Board had failed to address the Railroad Retirement Act’s presumption that a “payment made by an employer to an individual through the employer’s payroll shall be presumed, in the absence of evidence to the contrary, to be compensation for service rendered by such individual as an employee of the employer in the period with respect- to which the payment is made,” 45 U.S.C. § 231(h)(1) (emphasis added). We also ordered the Board to explain how Reed’s case differed from that of Illinois Central Gulf, Railroad Retirement Board, Legal Op. 89-80 (June 22, 1989), in which the Board credited as employment service the period during which individuals received “dismissal” payments.

On remand, the Board explained that the statutory presumption had been rebutted by “evidence to the contrary” — namely, the 1987 agreement under which, according to the Board’s interpretation, Reed resigned before he received the payments in question. Illinois Central Gulf was - different, the Board said, because in that casé- the employees agreed to resign at the end of the period during which their dismissal payments were to be made. We find these explanations adequate to satisfy the requirement of reasoned decisionmaking.

We review decisions of the Board for substantial evidence in the record and for errors of law. See Andrews v. Railroad Retirement Bd., 595 F.2d 676, 681 & n. 59 (D.C.Cir.1978); 45 U.S.C. § 231g; 45 U.S.C. § 355(f). Moreover, we apply a Chevron 1 analysis when reviewing an agency’s interpretation of a contract. See National Fuel Gas Supply Corp. v. FERC, 811 F.2d 1563, 1569 (D.C.Cir.1987). Thus, if the intent of the parties is clearly expressed in the document, that intent must prevail. See id. at 1572. If the contractual language is ambiguous, however, we will defer to an agency’s reasonable interpretation. See id.

Under these deferential standards, we uphold the Board’s conclusion that Reed had no employment relationship with Conrail after December 1987. The agreement stated that Reed was “an employee, officer and director of Conrail” and that he wished- “to resign all such positions with Conrail.” The specific resignation clause provided that “[e]ffective at the close of business on December 31, 1987,” Reed “resigns from employment as President and Chief Operating Officer of Conrail and as a member of Conrail’s Board of Directors.” Although the resignation clause did not repeat that Reed also was resigning as an “employee,” there is nothing to suggest that Reed’s prior status as an “employee” was based on anything other than his positions as officer and director. To the contrary, a subsequent paragraph of the agreement noted that Reed “was asked to and agreed to resign from his positions with Conrail” (emphasis added). Nor is there anything in the agreement to suggest that Reed would receive any new position, “hold himself available” to advise Conrail, or otherwise perform any future services. The absence of such indications is *376 particularly significant given the agreement’s integration clause, which stated that “[t]his agreement and Exhibit A attached hereto [the general release] contain the entire agreement between the parties hereto and supersede any and all prior or contemporaneous agreements between the parties.”

Other sections of the agreement to which Reed points do not counsel a different interpretation. Although the agreement did provide that Reed’s life insurance and medical benefits would be made available to him “as if his employment were continuous from February 10, 1979 through July 31, 1990” (emphasis added), the subjunctive mood of the emphasized language indicates the signers’ understanding that Reed’s employment would not actually be continuous' for that period.

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Cite This Page — Counsel Stack

Bluebook (online)
145 F.3d 373, 330 U.S. App. D.C. 246, 1998 U.S. App. LEXIS 11919, 1998 WL 295627, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reed-v-railroad-retirement-board-cadc-1998.