EagleTribune.com, North Andover, MA

January 19, 2013

Flaherty loses bid for pension

Can appeal decision within 20 days

By Shawn Regan
sregan@eagletribune.com

---- — HAVERHILL — James Flaherty, the former city highway superintendent convicted of stealing from the city, has suffered a loss in his long-running fight to win back his $64,744-a-year pension.

A state Appeals Court decision released yesterday affirmed prior rulings from a superior court and district court that upheld the Haverhill Retirement Board’s 2009 decision to strip Flaherty, 70, of his pension. According to the court ruling, the pension is worth $940,000 based on Flaherty’s life expectancy, and includes health benefits for him and his wife.

In May 2009, Flaherty was convicted by a jury of felony larceny over $250 and pleaded guilty to three counts of filing false tax returns following his trial in Salem Superior Court. Three months later, the Haverhill Retirement Board revoked Flaherty’s pension based on a law that states a person convicted of using his public position to steal from the public forfeits the right to collect the benefit.

The Appeals Court decision released yesterday also ruled Flaherty must repay the Retirement Board $64,008 which he collected before his pension was taken away. That amount represents the difference between the $84,000 that Flaherty paid into his retirement account prior to filing for benefits and the $148,000 he collected before payments were stopped.

“We’re, of course, pleased with the decision,” said Michael Sacco, attorney for the Retirement Board. “It’s important that public employees be held to a standard in which they can’t commit a crime related to their public position and still receive a pension.”

Sacco said Flaherty has 20 days to ask the state Supreme Judicial Court, the state’s highest court, for a further legal review. That court has discretion to accept or reject the case, Sacco said.

When the case is over, Sacco said it will be up the Retirement Board to make arrangements with Flaherty for him to return the $64,008.

A message left for Flaherty’s lawyer, Scott Gleason, seeking comment for this story was not returned.

In court, Gleason has argued that stripping Flaherty of his pension for “stealing $700 worth of dirt” is disproportional punishment and violates the Eighth Amendment to the U.S. Constitution, which prohibits cruel and unusual punishment as well as excessive fines. Flaherty was convicted of stealing paving material from the city.

Gleason also argued at the Appeals Court hearing in September that Flaherty’s pension should be restored because the theft of paving material “was not related to (Flaherty’s) official capacity even though he did it on city time.” For instance, Gleason said, public employees have been convicted of drunk driving on work time and not had their pensions taken away.

The paving material, called H-base, is what’s left when a paved driveway is broken up to be redone. During Flaherty’s career in Haverhill, the material was brought back to the city’s highway yard to be stored and eventually recycled into new paving material. Some of the H-base was used by the city and some of it was sold to private contractors. Flaherty was convicted of using some of the material for his private, family-owned paving business.

Sacco argued the intent of the law is to provide a deterrent against public officials violating the public trust. He said the value of the stolen property is irrelevant.

“If he is allowed to keep his pension, the perception will be that you can commit a crime as long as it’s not that bad of a crime,” Sacco said in a prior interview. “The intent of the Legislature was that it’s not just about raw harm. It’s to deter someone in that position from doing harm to the public.”

Sacco also argued that Flaherty losing his pension is “a collateral consequence for the offense” and not a fine.

“A pension is a benefit that requires honorable service (to receive),” he said.

Sacco noted there is no Supreme Judicial Court case law on whether the revocation of a pension is a fine. He speculated that could form the basis of an appeal to the high court. Sacco said the Flaherty ruling is also the first time the court has ordered someone to repay a portion of a pension already collected, which could also be grounds for further appeal, he said.

Following his trial in the summer of 2009, Flaherty was sentenced to six months in Middleton Jail and three and a half years of probation. He ultimately served less than three months of the jail sentence confined to his Haverhill home and his probationary period ended this week. Flaherty’s probation was terminated and he was discharged from further supervision by the court following a hearing Wednesday at Lawrence Superior Court.