                                NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.




                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-3167-18T3

LAUREN COOKE,

         Petitioner-Appellant,

v.

BOARD OF TRUSTEES,
TEACHERS' PENSION
AND ANNUITY FUND,

     Respondent-Respondent.
__________________________

                   Argued telephonically March 23, 2020 –
                   Decided April 14, 2020

                   Before Judges Sumners and Geiger.

                   On appeal from the Board of Trustees of the Teachers'
                   Pension and Annuity Fund, Department of the
                   Treasury.

                   Michael Patrick DeRose argued the cause for appellant
                   (Crivelli & Barbati LLC, attorneys; Michael Patrick
                   DeRose, on the brief).

                   Austin J. Edwards, Deputy Attorney General, argued
                   the cause for respondent (Gurbir S. Grewal, Attorney
                   General, attorney; Melissa H. Raksa, Assistant
            Attorney General, of counsel; Austin J. Edwards, on the
            brief).

PER CURIAM

      Petitioner Lauren Cooke appeals from a February 14, 2019 final decision

of respondent Board of Trustees (the Board) of the Teachers' Pension and

Annuity Fund (TPAF), imposing a ten percent forfeiture of Cooke's pension

benefits pursuant to N.J.S.A. 43:1-3 and N.J.A.C. 17:1-6.1. We affirm.

                                       I.

      Commencing on September 1, 1993, Cooke was employed by the Egg

Harbor Township Board of Education (the School Board) as an elementary

teacher. In November 2007, Cooke called another teacher, Jamesella Johnson,

"Aunt Jemima" in the presence of other teachers. In June 2008, Cooke called

Johnson a "nigger" in the presence of students and other teachers.         Both

statements were made during school hours and on school property. The School

Board contended that Cooke's racial epithets were made in anger and not in jest.

      The School Board certified tenure charges with the Commissioner of

Education to terminate Cooke from employment and suspended her without pay

for 120 days, for violating the New Jersey Law Against Discrimination (LAD),

N.J.S.A. 10:5-1 to -42. The School Board alleged Cooke engaged in harassment,

intimidation, and bullying in making improper, racially derogatory comments

                                                                       A-3167-18T3
                                       2
towards Johnson and lying to an administrator during a resulting investigation

in violation of N.J.A.C. 6A:16-7.9(a)(2)(vi),1 School Board Policy No. 5512.01,

and School Board Policy No. 3281.             Cooke contested the termination and

suspension without pay.

       The matter was transferred to the Office of Administrative Law (OAL) as

a contested case. On July 22, 2010, an Administrative Law Judge (the Tenure

ALJ) issued an Initial Decision finding Cooke had engaged in conduct

unbecoming a teacher in violation of School Board Policy No. 3281. The Tenure

ALJ found

             that on "Fun Day" in June 2008, when Ms. Cooke was
             speaking to Jordan Brown, another teacher, in the
             hallway of the Davenport school during school hours
             with teachers and school children present, and referred
             to a third teacher, Jamesella Johnson, as a "nigger" she
             engaged in conduct unbecoming a teaching staff
             member.

The Tenure ALJ further found

             that in November 2007, when Ms. Cooke was speaking
             to Lynne Dixon, another teacher in the teachers' lounge
             of the Davenport elementary school during school
             hours with other teachers present, and Ms. Cooke
             referred to a third teacher, Jamesella Johnson, as "Aunt
             Jemima," she engaged in conduct unbecoming a
             teaching staff member. I have reached this conclusion
             because the term "Aunt Jemima" carries the

1
    Now codified in N.J.A.C. 6A:16-7.7.
                                                                         A-3167-18T3
                                          3
            connotation of servitude or slavery involving cooking
            services provided by an African-American woman to a
            Caucasian "master."

The Tenure ALJ determined that removal was not warranted and recommended

a 150-day suspension without pay.

      On November 22, 2010, the Acting Commissioner of Education adopted

the Tenure ALJ's factual findings but modified the penalty to 120 days of salary

withholding pursuant to N.J.S.A. 18A:6-14, plus an additional thirty-day

suspension without pay, and mandatory training on racial sensitivity at Cooke's

own expense. Both parties appealed the Commissioner's decision. Cooke also

filed a complaint in the Law Division against the School Board and several other

parties seeking relief for alleged discrimination and retaliation under the LAD

and the New Jersey Civil Rights Act, N.J.S.A. 10:6-1 to -2.

      In February 2012, the tenure appeal and the Law Division action were

settled without any "assurance, warranty or guaranty" as to how the Board would

decide any application for retirement benefits.       The settlement included

withdrawal of the tenure decision cross-appeals and the Law Division action.

As part of the settlement, Cooke received compensation for administrative leave

from January 1 to December 31, 2012.




                                                                        A-3167-18T3
                                       4
      Cooke then applied for accidental disability retirement benefits but was

granted, and ultimately accepted, ordinary disability retirement benefits

effective January 1, 2013. On October 7, 2014, the Board informed Cooke that

it had recently learned of the tenure charges brought against her. The Board

performed an honorable service review, applying and weighing the eleven

factors set forth in Uricoli v. Police and Firemen's Retirement System, 91 N.J.

62, 77-78 (1982), later codified in N.J.S.A. 43:1-3(c). The Board imposed a ten

percent reduction in her ordinary disability retirement benefits effective January

1, 2013 (allocating five percent to each of the two incidents).

      Cooke appealed the Board's decision. The appeal was transferred to the

OAL as a contested case. An ALJ (the Forfeiture ALJ) conducted a one-day

hearing, without either party calling witnesses, on the following stipulated facts:

   1. Cooke has sixteen years and eleven months of membership service in the

       TPAF.

   2. On January 16, 2012, the Division received Cooke's application for an

       accidental disability retirement.

   3. Cooke was vested with over ten years of service on October 1, 2012, her

       effective date of retirement.

   4. Cooke was employed as a teacher.


                                                                          A-3167-18T3
                                           5
5. On September 1, 1993, Cooke was enrolled in the TPAF as a result of her

   employment as a teacher with the Egg Harbor Township Board of

   Education. During her employment she was suspended without pay from

   December 1, 2008 through May 1, 2009, and from December 1, 2010

   through January 20, 2011. She was placed on paid administrative leave

   from January 1, 2012 to December 31, 2012, which was the last date

   pension contributions were remitted on her behalf. She resigned from

   employment pursuant to the terms of the settlement agreement.

6. Cooke had no other public employment or service.

7. The Egg Harbor Township Board of Education filed tenure charges

   against petitioner for conduct unbecoming a tenured teacher. On appeal,

   the Tenure ALJ found that on two occasions, in approximately November

   2007 and June 2008, Cooke used racial epithets in reference to another

   teacher.   The Tenure ALJ concluded these incidents constituted

   unbecoming conduct for a teacher and determined that Cooke violated

   School Board Policy No. 3281, Inappropriate Staff Conduct.            The

   Commissioner of Education concurred with the conclusion of the Tenure

   ALJ. Cooke filed an appeal of the tenure matter in the Appellate Division

   and filed a LAD claim against her employer in the Superior Court, Law


                                                                    A-3167-18T3
                                   6
      Division. Subsequently, the parties negotiated a settlement and both

      matters were dismissed. The Board noted that the Commissioner of

      Education indicated that the charges against petitioner were serious in

      nature.

   8. Cooke's and the Board's appeals were dismissed.

   9. As of January 1, 2013, petitioner's total pension benefit was $2,624.58

      per month. After the ten percent reduction in the amount of $262.46, her

      current allowance is $2,362.12 per month.

      On November 14, 2018, the Forfeiture ALJ issued an Initial Decision in

which she relied upon the Tenure ALJ's factual findings, which were

subsequently adopted by the Board. The Forfeiture ALJ found that on both

occasions, the racial epithets were made to a staff member other than the target

of the inappropriate racist comments, who was not present. No students were

present during either incident.

      The Forfeiture ALJ noted that the parties stipulated to the seven Uricoli

factors. As to factor seven, the Forfeiture ALJ found Cooke was charged

misconduct, not criminal behavior. "Neither of the comments were made in the

presence of any students." The misconduct involved two incidents that "were

isolated events that occurred in private conversations."


                                                                       A-3167-18T3
                                       7
      As to factor eight, the Forfeiture ALJ noted the Commissioner determined

"that the misconduct did not establish [Cooke's] unfitness to discharge the duties

and functions of her position as a teacher." Based on that determination, the

Forfeiture ALJ concluded factor eight weighed in favor of Cooke because "there

is no direct relationship between [Cooke's] misconduct and her public duties as

a teacher and the [Board] is collaterally estopped from finding otherwise."

      As to factor nine, the Forfeiture ALJ noted "[t]he Acting Commissioner

characterized the misconduct as serious in nature" and a "a serious error in

judgment." Based on the previously described circumstances of the misconduct,

the Forfeiture ALJ concluded that factor nine weighed in favor of Cooke.

      As to factor ten, the Forfeiture ALJ noted the Acting Commissioner

determined that the loss of 120 days of salary, coupled with a thirty-day

suspension without pay, and racial sensitivity training was a sufficient penalty.

Therefore, factor ten weighed in favor of Cooke.

      Finally, as to factor eleven, the Forfeiture ALJ noted the Acting

Commissioner found the mitigating factors included: Cooke had never been

previously disciplined; there was no evidence that Cooke treated the students

inappropriately; Cooke's comments were not directed at a student; no student




                                                                         A-3167-18T3
                                        8
overheard her comments; and the comments were made during private

conversations. Therefore, factor eleven also weighed in favor of Cooke.

      The Forfeiture ALJ concluded that Cooke's "misconduct did not constitute

a breach of the condition that public service be honorable." She also concluded

that "the ten percent partial forfeiture of [Cooke's] retirement benefits [was]

inappropriate and should be reversed." The Attorney General filed exceptions

to the Initial Decision.

      The Board found the Forfeiture ALJ "failed to appropriately weigh" the

Uricoli factors, misapplied the law, and failed "to make conclusions based on

the entire record." The Board modified the Initial Decision by making the

following additional findings of fact.

      The Board noted the Tenure ALJ found as aggravating circumstances that:

(1) Cooke's statements were made during school hours; (2) Cooke's reference to

another teacher as a "nigger" was made in the presence of children and other

teachers; (3) Cooke is a teacher in an elementary school; (4) Cooke's statements

were said out of anger and not in a joking manner; and (5) Cooke referred to the

same teacher as "Aunt Jemima" on a subsequent occasion.

      The Board further noted that the Tenure ALJ found Cooke's testimony was

outweighed by the testimony of two credible witnesses having no apparent


                                                                        A-3167-18T3
                                         9
motive for being less than truthful. The Tenure ALJ also found that as a public

role model, Cooke's actions are judged with more scrutiny than the typical

government employee. As an elementary school teacher, Cooke was arguably

required to exercise even greater self-restraint.        "[H]er failure to act

appropriately ha[d] recklessly put young children at risk, ha[d] created

unnecessary tension among the teachers and ha[d] cast doubt as to her fitness to

teach impressionable children." The Tenure ALJ further found the utterance of

racial slurs was unbecoming conduct regardless of whether children were

present. Finally, the Tenure ALJ found that Cooke's reference to the same

teacher as "Aunt Jemima" showed a pattern of behavior rather than an isolated

incident.

      As to Uricoli factors, the Board found factors one through seven weighed

in favor of a partial forfeiture. Regarding factor seven (nature of misconduct or

crime), the Board noted that its "powers to determine a pension forfeiture are

not limited to criminal misconduct," citing Corvelli v. Board of Trustees, Police

& Firemen's Retirement System, 130 N.J. 539, 552 (1992).

      As to factor eight (relationship between misconduct and public duties),

the Board rejected the Forfeiture ALJ's application of collateral estoppel to the

finding in the tenure proceeding that Cooke's "misconduct did not establish [her]


                                                                        A-3167-18T3
                                      10
unfitness to discharge the duties and functions of her position as a teacher."

Relying on Winters v. North Hudson Regional Fire & Rescue, 212 N.J. 67, 85

(2012), the Board concluded it was not collaterally estopped because it was not

a party to the tenure proceeding. It deemed Cooke collaterally estopped from

disputing the finding that she called Johnson racial epithets on two identifiable

occasions because she was a party to the tenure proceeding.

      The Board rejected "the Forfeiture ALJ's conflation of the standards in

disciplinary matters and pension forfeiture matters." While the tenure decision

properly considered progressive discipline in determining whether the record

supported removal, it did not analyze whether the misconduct had a direct

relationship to her teaching duties. The Board found "the Forfeiture ALJ erred

in not making an independent analysis of these facts under Uricoli." The Board

concluded that factor eight weighed in favor of partial forfeiture.

      As to factor nine (quality of moral turpitude), the Board noted that "the

Forfeiture ALJ acknowledged that the Tenure Decision described Cooke's

conduct as serious in nature and as a serious error in judgment, but failed to give

sufficient weight to the sustained charges of conduct unbecoming." The Board

concluded the Forfeiture ALJ failed to recognize how Cooke's misconduct




                                                                          A-3167-18T3
                                       11
related to her duties as a teacher and rose to the level of moral turpitude. The

Board found factor nine weighed in favor of partial forfeiture.

        As to factor ten (availability and adequacy of other penal sanctions), the

Board rejected "the Forfeiture ALJ's summary conclusions." It found that even

though factor ten weighed more heavily in Cooke's favor, factors seven, eight,

and nine should be given greater weight in the Board's decision, citing Corvelli,

130 N.J. at 553.

        Finally, as to factor eleven (other personal circumstances bearing upon

justness of forfeiture), the Board rejected "the Forfeiture ALJ's failure to balance

mitigating factors against the aggravating circumstances found by the Tenure

ALJ."     Because she found the personal circumstances asserted by Cooke

unavailing, factor eleven weighed in favor of partial forfeiture.

        The Board concluded that Cooke's dishonorable conduct warranted partial

forfeiture. It modified the Forfeiture ALJ's findings of fact, modified and

rejected her conclusions of law, and affirmed the ten percent forfeiture of

Cooke's pension. This appeal followed.

        In this appeal, Cooke raises the following points: (1) the Board's rejection

of the Forfeiture ALJ's Initial Decision and affirmance of the ten percent partial

pension forfeiture was arbitrary, capricious, and inconsistent with governing


                                                                           A-3167-18T3
                                        12
law; (2) the Board failed to afford due consideration of Uricoli factor ten,

regarding the adequacy of other penal sanctions, and factor eleven, pertaining to

other personal circumstances bearing upon the justness of forfeiture; and (3)

alternatively, it was error for the Board to apply collateral estoppel in light of

the underlying procedural history.

                                        II.

                                        A.

      Our review of a final decision of an administrative agency is limited.

Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J. 14, 27 (2011) (citing

In re Herrmann, 192 N.J. 19, 27 (2007)). The agency's decision should be upheld

"unless there is a clear showing that it is arbitrary, capricious, or unreasonable,

or that it lacks fair support in the record." Ibid. (quoting Herrmann, 192 N.J. at

27-28). "The burden of demonstrating that the agency's action was arbitrary,

capricious or unreasonable rests upon the [party] challenging the administrative

action." In re Arenas, 385 N.J. Super. 440, 443-44 (App. Div. 2006) (citations

omitted).

      "We recognize that agencies have 'expertise and superior knowledge . . .

in their specialized fields.'" Hemsey v. Bd. of Trs., Police & Firemen's Ret.

Sys., 198 N.J. 215, 223 (2009) (alteration in original) (quoting In re License


                                                                          A-3167-18T3
                                       13
Issued to Zahl, 186 N.J. 341, 353 (2006)). We therefore accord deference to the

"agency's interpretation of a statute" it is charged with enforcing. Thompson v.

Bd. of Trs., Teachers' Pension & Annuity Fund, 449 N.J. Super. 478, 483 (App.

Div. 2017) (quoting Richardson v. Bd. of Trs., Police & Firemen's Ret. Sys.,

192 N.J. 189, 196 (2007)), aff'd o.b., 233 N.J. 232 (2018). "'Such deference has

been specifically extended to state agencies that administer pension statutes,'

because 'a state agency brings experience and specialized knowledge to its task

of administering and regulating a legislative enactment within its field of

expertise.'" Id. at 483-84 (quoting Piatt v. Police & Firemen's Ret. Sys., 443

N.J. Super. 80, 99 (App. Div. 2015)).

      "A reviewing court 'may not substitute its own judgment for the agency's,

even though the court might have reached a different result.'" In re Stallworth,

208 N.J. 182, 194 (2011) (quoting In re Carter, 191 N.J. 474, 483 (2007)). "This

is particularly true when the issue under review is directed to the agency's

special 'expertise and superior knowledge of a particular field.'" Id. at 195

(quoting Herrmann, 192 N.J. at 28).

      That said, when the facts are undisputed, determinations involving

statutory interpretation are reviewed de novo. Bowser v. Bd. of Trs., Police &

Firemen's Ret. Sys., 455 N.J. Super. 165, 170-71 (App. Div. 2018). Conversely,


                                                                        A-3167-18T3
                                        14
when controlling facts are disputed, we afford deference to the Board's factual

findings. Oceanside Charter Sch. v. Dep't of Educ., 418 N.J. Super. 1, 9 (App.

Div. 2010).

                                       B.

      A public employee must provide "honorable service" to receive pension

or retirement benefits. N.J.S.A. 43:1-3(a) ("The receipt of a public pension or

retirement benefit is . . . expressly conditioned upon the rendering of honorable

service by a public officer or employee."); N.J.A.C. 17:1-6.1(a); see also

Corvelli, 130 N.J. at 550 (noting all of New Jersey's public pension statutes

have an implied requirement of honorable service, and forfeiture can be ordered

for employees who violate that requirement). The Board is authorized to order

forfeiture, in whole or in part, "for misconduct occurring during the member's

public service which renders the member's service or part thereof dishonorable."

N.J.S.A. 43:1-3(b); see also N.J.A.C. 17:1-6.1(a), (c).

      The forfeiture of a public employee's pension is governed by the eleven

factors enumerated in Uricoli, 91 N.J. at 77-78, and subsequently codified in

N.J.S.A. 43:1-3(c):

              (1) the member's length of service; (2) the basis for
              retirement; (3) the extent to which the member's
              pension has vested; (4) the duties of the particular
              member; (5) the member's public employment history

                                                                        A-3167-18T3
                                      15
              and record covered under the retirement system; (6) any
              other public employment or service; (7) the nature of
              the misconduct or crime, including the gravity or
              substantiality of the offense, whether it was a single or
              multiple offense and whether it was continuing or
              isolated; (8) the relationship between the misconduct
              and the member's public duties; (9) the quality of moral
              turpitude or the degree of guilt or culpability, including
              the member's motives and reasons, personal gain and
              similar considerations; (10) the availability and
              adequacy of other penal sanctions; and (11) other
              personal circumstances relating to the member which
              bear upon the justness of forfeiture.

              [N.J.S.A. 43:1-3(c).]

        The factors "must be balanced and then weighed in terms of the goals to

be achieved under the pension laws."            Uricoli, 91 N.J. at 78.      The test

"accommodates equitable considerations." Corvelli, 130 N.J. at 552. The Board

may, however, attribute more weight to factors seven, eight, and nine, when

applicable. Id. at 552-53.

        Forfeiture may be total or partial; partial forfeiture is generally "calculated

as if the accrual of pension rights terminated as of the date the misconduct first

occurred." N.J.S.A. 43:1-3(d); see also Uricoli, 91 N.J. at 79. If the resulting

forfeiture is excessive, the forfeiture should be modified to "reflect[] the nature

and extent of the misconduct and the years of honorable service." N.J.S.A. 43:1-

3(d).


                                                                              A-3167-18T3
                                          16
                                        C.

      With those principles in mind, we consider whether the Board's decision

was arbitrary, capricious, unreasonable, or unsupported by substantial credible

evidence in the record.

      We first note that an ALJ's factual findings of lay-witness credibility

generally receive deference. See N.J.S.A. 52:14B-10(c) ("The [Board] may not

reject or modify any findings of fact as to issues of credibility of lay witness

testimony unless . . . the findings are arbitrary, capricious or unreasonable or are

not supported by sufficient, competent, and credible evidence in the record.").

In considering that evidence, "the reviewing court should give 'due regard to the

opportunity of the one who heard the witnesses to judge of their credibility. '"

Clowes v. Terminix Int'l, Inc., 109 N.J. 575, 587 (1988) (quoting Close v.

Kordulak Bros., 44 N.J. 589, 599 (1965)). "[I]t is not for us or the agency head

to disturb that credibility determination, made after due consideration of the

witnesses' testimony and demeanor during the hearing." H.K. v. Dep't Human

Servs., 184 N.J. 367, 384 (2005).        Here, the Tenure ALJ found Cooke's

testimony was outweighed by the testimony of two credible witnesses having no

apparent motive to lie.




                                                                           A-3167-18T3
                                        17
      Their testimony demonstrated that Cooke's misconduct occurred on

school property during school hours. It involved two separate incidents of using

racial epithets to disparage a fellow teacher. One statement was made in the

presence of teachers; the other was made in the presence of teachers and

students. The epithets were stated in anger, not jest. The misconduct involved

a repeated pattern of behavior rather than an isolated incident. Cooke's repeated

misconduct was related to her position.

      The Board contends that the Forfeiture ALJ erred in applying collateral

estoppel against it rather than Cooke. We agree. In order to apply collateral

estoppel, the party against whom the doctrine is asserted must have been a party

to the earlier proceeding and "the issue to be precluded [must be] identical to

the issue decided in the prior proceeding." Winters, 212 N.J. at 85 (quoting

Olivieri v. Y.M.F. Carpet, Inc., 186 N.J. 511, 521 (2006)). Here, neither of those

elements are met. The Board was not a party to the tenure proceedings. The

tenure proceeding involved a different issue (removal or discipline short of

removal) than the pension proceeding (forfeiture of pension benefits).

Consequently, it was error to apply collateral estoppel against the Board.

      The result is, of course, different as to Cooke. Cooke was a party to the

tenure proceeding. The misconduct involved was identical in both proceedings;


                                                                         A-3167-18T3
                                       18
the issue was actually litigated in the tenure proceeding; the issue was decided

on the merits in the tenure proceeding; the determination of the issue was

essential to the decision in the tenure proceeding; and Cooke was a party in the

tenure proceeding. See ibid. (quoting Olivieri, 186 N.J. at 521). Moreover,

Cooke has not demonstrated that the settlement agreement was intended "to

operate to vacate" the tenure decision since the settlement agreement contained

no such language. Perez v. Rent-A-Center, Inc., 186 N.J. 188, 201 (2006).

Consequently, the Board properly applied collateral estoppel against Cooke as

to the factual findings of the Tenure ALJ.        See Winters, 212 N.J. at 73

(reaffirming that "estoppel principles can apply to findings made in

administrative proceedings and affect subsequent judicial proceedings").

      Given our deferential standard of review and the serious nature of Cooke's

repeated misconduct, we discern no basis to overturn the Board's final decision

to impose a ten percent forfeiture of Cooke's pension benefits. The Board's

findings are supported by substantial evidence in the record.         The Board

carefully applied and weighed the Uricoli factors, thus, its decision is neither

arbitrary, capricious, nor unreasonable. Lastly, the partial forfeiture is not "so

disproportionate to the offense, in light of all the circumstances, as to be

shocking to one's sense of fairness." Matter of Hendrickson, 235 N.J. 145, 159


                                                                         A-3167-18T3
                                       19
(2018) (quoting Herrmann, 192 N.J. at 28-29). On the contrary, the Board

limited the forfeiture so that it was not excessive, even if hypothetically a more

severe sanction might have been imposed.

      Affirmed.




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                                       20
