A-20059, OCTOBER 24, 1927, 7 COMP. GEN. 287

A-20059: Oct 24, 1927

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

PAYMENTS THEREUNDER ARE NOT SUBJECT TO THE RESTRICTED PERMITTED CLASS OF BENEFICIARIES NAMED IN THE AMENDATORY STATUTE OF THAT DATE AS TO INSURANCE "HEREAFTER REVIVED.' 7 COMP. 454 IS REQUESTED AT THIS TIME BY REASON OF THE INTEREST OF UNITED STATES SENATOR. THE GENERAL QUESTION INVOLVED IN THE GUST CASE AS WILL HEREINAFTER APPEAR. IS THE APPLICATION OF THE PHRASE "INSURANCE HEREAFTER REVIVED. IT WAS PREVIOUSLY DECIDED BY THE BUREAU THAT THE INSURANCE IN THIS PARTICULAR CASE WAS NOT HEREAFTER REVIVED WITHIN THE MEANING OF THE OPINION OF THE ATTORNEY GENERAL OF THE UNITED STATES. ACCORDINGLY AWARDS WERE PREPARED AND SUBMITTED TO THE VETERANS' BUREAU SECTION. THESE AWARDS WERE DISAPPROVED ON THE GROUND THAT TO APPROVE THEM WOULD BE CONTRARY TO YOUR DECISION OF AUGUST 17.

A-20059, OCTOBER 24, 1927, 7 COMP. GEN. 287

VETERANS' BUREAU - INSURANCE - REVIVAL WHERE THE FACTS IN A PARTICULAR CASE SHOW THAT THE VETERANS' BUREAU, PRIOR TO JULY 2, 1926, FINALLY DETERMINED THAT ALL THE CONDITIONS SPECIFIED IN SECTION 305 OF THE WORLD WAR VETERANS' ACT TO REVIVE WAR RISK INSURANCE BY THE APPLICATION OF UNCOLLECTED DISABILITY COMPENSATION AS PREMIUMS HAD BEEN MET, AND THE PARTIES IN INTEREST ADVISED THEREOF, SUCH INSURANCE MAY BE CONSIDERED AS REVIVED PRIOR TO JULY 2, 1926, AND PAYMENTS THEREUNDER ARE NOT SUBJECT TO THE RESTRICTED PERMITTED CLASS OF BENEFICIARIES NAMED IN THE AMENDATORY STATUTE OF THAT DATE AS TO INSURANCE "HEREAFTER REVIVED.' 7 COMP. GEN. 118 AMPLIFIED.

COMPTROLLER GENERAL MCCARL TO THE DIRECTOR, UNITED STATES VETERANS' BUREAU, OCTOBER 24, 1927:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF SEPTEMBER 26, 1927, REQUESTING DECISION OF A QUESTION PRESENTED AS FOLLOWS:

YOUR CONSIDERATION OF THE CASE OF LOUIS GUST, C-4666,454 IS REQUESTED AT THIS TIME BY REASON OF THE INTEREST OF UNITED STATES SENATOR, WILLIAM E. BORAH, IN THIS PARTICULAR CLAIM.

THE GENERAL QUESTION INVOLVED IN THE GUST CASE AS WILL HEREINAFTER APPEAR, IS THE APPLICATION OF THE PHRASE "INSURANCE HEREAFTER REVIVED," AS NOW CONTAINED IN SECTION 305 OF THE WORLD WAR VETERANS' ACT, AS AMENDED. IT WAS PREVIOUSLY DECIDED BY THE BUREAU THAT THE INSURANCE IN THIS PARTICULAR CASE WAS NOT HEREAFTER REVIVED WITHIN THE MEANING OF THE OPINION OF THE ATTORNEY GENERAL OF THE UNITED STATES, DATED JUNE 22, 1927. ACCORDINGLY AWARDS WERE PREPARED AND SUBMITTED TO THE VETERANS' BUREAU SECTION, AUDIT DIVISION, GENERAL ACCOUNTING OFFICE, BUT THESE AWARDS WERE DISAPPROVED ON THE GROUND THAT TO APPROVE THEM WOULD BE CONTRARY TO YOUR DECISION OF AUGUST 17, 1927, A-19253 (BASED UPON THE CLAIM OF HARDIN NEAL COX.) IN THAT DECISION YOU STATED:

"THE ACTION IS THE DETERMINATION OR FINDING BY THE VETERANS' BUREAU THAT ALL OF THE CONDITIONS OF THE STATUTE HAVE BEEN MET, INCLUDING WHETHER THERE IS AVAILABLE UNCOLLECTED DISABILITY COMPENSATION FOR APPLICATION AS PREMIUMS, AND THE MAKING OF THE AWARD.'

THE RECORD FACTS IN THE CASE OF LOUIS GUST SHOW THAT HE ENTERED THE MILITARY SERVICE IN JULY, 1918, AND APPLIED FOR $10,000 WAR RISK INSURANCE IN FAVOR OF HIMSELF ON JULY 16, 1918. HE WAS DISCHARGED ON JUNE 20, 1919, AND THEREAFTER PERMITTED HIS INSURANCE TO LAPSE. HE DIED DECEMBER 2, 1921, AFTER HAVING FIRST APPLIED FOR COMPENSATION IN SEPTEMBER, 1920. THE DATE OF THE LAPSE OF INSURANCE THE VETERAN, OF COURSE, HAD NOT RECEIVED ANY DISABILITY RATING, AND THE FIRST COMPLETE RATING WAS NOT MADE UNTIL APRIL 28, 1921, WHICH FOUND A TEMPORARY PARTIAL DISABILITY OF 25 PERCENT FROM DISCHARGE TO SEPTEMBER 1, 1920. ON OCTOBER 7, 1921, THE VETERAN WAS FOUND PERMANENTLY AND TOTALLY DISABLED FROM DECEMBER 1, 1919.

ON THESE FACTS IT IS CLEAR THAT THERE WAS UNCOLLECTED COMPENSATION BOTH AT THE DATE OF THE LAPSE OF THE INSURANCE AND ALSO AT THE DATE OF THE MATURITY OF THE INSURANCE BY REASON OF THE PERMANENT AND TOTAL DISABILITY, EFFECTIVE SEPTEMBER 1, 1919, INASMUCH AS THE LATTER DATE WAS PRIOR TO ANY COMPLETE DISABILITY RATING.

THE PARTIES OF INTEREST WERE NOTIFIED BY THE BUREAU THAT THE INSURANCE HAD BEEN REVIVED UNDER SECTION 305 OF THE WORLD WAR VETERANS' ACT, AND NECESSARY STEPS WERE TAKEN BY THE PARTIES OF INTEREST TO PROCURE LETTERS OF ADMINISTRATION ON THE VETERANS' ESTATE, WHICH LETTERS WERE DATED IN JULY, 1921. THE BUREAU ALSO TOOK STEPS TO COMPUTE THE PRESENT VALUE OF THE INSURANCE PAYABLE IN A LUMP SUM, ON THE THEORY THAT SUCH PAYMENT WAS TO BE MADE UNDER THE PROVISIONS OF SECTION 303 OF THE WORLD WAR VETERANS' ACT. THIS ACTION WAS TAKEN IN APRIL, 1926, BUT THE INSURANCE WAS NOT ACTUALLY AWARDED OR PAID PRIOR TO JULY 2, 1926.

HAVING IN MIND THE LANGUAGE USED IN YOUR DECISION IN THE HARDIN NEAL COX CASE, YOU ARE ASKED TO ADVISE THIS BUREAU WHETHER INSURANCE IN THE PRESENT CASE IS TO BE REGARDED AS "HEREAFTER REVIVED," IN VIEW OF THE FACT THAT PRACTICALLY ALL OF THE NECESSARY STEPS WERE TAKEN BY THE BUREAU PRIOR TO JULY 2, 1926, TO DETERMINE THAT THIS INSURANCE HAD BEEN REVIVED. HEREIN INDICATED, NOT ONLY WERE THE PARTIES OF INTEREST ADVISED THAT THE INSURANCE WAS PAYABLE, BUT NECESSARY STEPS WERE TAKEN TO COMPUTE THE ACTUAL AMOUNT OF THE PAYMENT TO BE MADE TO A REPRESENTATIVE OF THE VETERAN'S ESTATE UNDER THE PROVISIONS OF SECTION 303, WORLD WAR VETERANS' ACT, AS AMENDED, OF THE INSURANCE WHICH HAD BEEN REVIVED UNDER THE PROVISIONS OF SECTION 305 OF THE SAME ACT.

YOU DO NOT STATE WHETHER ALL OF THE DISABILITY COMPENSATION DUE AND PAYABLE AT DATE OF PERMANENT TOTAL DISABILITY WAS OR WAS NOT COLLECTED BY THE INSURED PRIOR TO HIS DEATH ON DECEMBER 2, 1921. IF IT WAS SO COLLECTED, THEN THERE WAS NO UNPAID DISABILITY COMPENSATION TO BE APPLIED UNDER SECTION 305 OF THE WORLD WAR VETERANS' ACT, AS AMENDED BY THE ACT OF JULY 2, 1926, 44 STAT. 799, TO REVIVE INSURANCE. SEE DECISION OF AUGUST 20, 1927, 7 COMP. GEN. 131, AND, UPON RECONSIDERATION, DECISION OF OCTOBER 13, 1927. BUT FOR THE PURPOSE OF THIS DECISION IT WILL BE ASSUMED THAT THE DISABILITY COMPENSATION WAS NOT COLLECTED BY THE INSURED PRIOR TO HIS DEATH, BUT REMAINED UNPAID AND AVAILABLE TO REVIVE THE INSURANCE.

IN DECISION OF OCTOBER 19, 1927, A-19253, WHEREIN WAS RECONSIDERED THE DECISION OF AUGUST 17, 1927, 7 COMP. GEN. 118, IN THE HARDIN NEAL COX CASE, THERE WERE SHOWN ESSENTIAL DIFFERENCES BETWEEN THE FACTS IN THAT CASE AND THE FACTS IN TWO CASES ON THE BASIS OF WHICH THE TWO DECISIONS WERE RENDERED SEPTEMBER 9, 1927, BY THE UNITED STATES DISTRICT COURT, DISTRICT OF MINNESOTA, FOURTH DIVISION. THE CASES CONSIDERED BY THE COURT WERE THOSE OF HANNAH HEGG V. UNITED STATES (PAUL EDWARD CARSON C-583083) AND SCHIEFELBIEL V. UNITED STATES (WALTER BRIEGEL, C-481043). IN EACH OF THOSE CASES THE FACTS DISCLOSED THAT PRIOR TO THE PASSAGE OF THE AMENDATORY ACT OF JULY 2, 1926, 44 STAT. 799, 800, CONTAINING THE PHRASE "HEREAFTER REVIVED" AND NAMING A RESTRICTED PERMITTED CLASS TO WHOM INSURANCE REVIVED AFTER THE DATE OF THE ACT IS PAYABLE, THE VETERANS' BUREAU HAD ACTUALLY NOTIFIED THE PARTIES IN INTEREST THAT THE INSURANCE HAD BEEN REVIVED. THE FOLLOWING IS QUOTED FROM THE DECISION OF OCTOBER 19, 1927, SUPRA:

* * * IN EACH CASE, FOR SOME REASON NOT APPARENT FROM THE RECORD NOW SUBMITTED, THE VETERANS' BUREAU NOTIFIED THE PARTIES IN INTEREST SUBSEQUENT TO JULY 2, 1926, IN THE FIRST CASE SEPTEMBER 20, 1926, AND IN THE SECOND CASE NOVEMBER 5, 1926, THAT THE PROVISO CONTAINED IN THE ACT OF JULY 2, 1926, LIMITING PAYMENTS OF REVIVED INSURANCE TO A RESTRICTED PERMITTED CLASS, WOULD APPLY. THE ACTION OF THE VETERANS' BUREAU IN THIS CONNECTION WOULD APPEAR TO HAVE BEEN ERRONEOUS, AS THE INSURANCE HAD ALREADY BEEN REVIVED BY THE ADMINISTRATIVE ACTION OF THE BUREAU PRIOR TO THE DATE OF THE STATUTE, AND IT WAS IMMATERIAL IF NO PAYMENTS HAD YET BEEN MADE.

THE COURT PROPERLY HELD THAT THE INSURANCE WAS REVIVED IN EACH CASE PRIOR TO JULY 2, 1926. * *

IN THE PRESENT CASE IT IS REPORTED THAT ALL ADMINISTRATIVE ACTION NECESSARY TO REVIVE THE INSURANCE HAD BEEN TAKEN PRIOR TO JULY 2, 1926, AND THAT PRIOR TO SAID DATE THE VETERANS' BUREAU HAD ACTUALLY NOTIFIED THE PARTIES IN INTEREST THAT THE INSURANCE HAD BEEN REVIVED. APPARENTLY THE ONLY THING REMAINING TO BE DONE AFTER THE DATE OF THE ACT WAS THE QUALIFICATION OF AN ADMINISTRATOR OF THE ESTATE OF THE INSURED TO RECEIVE PAYMENT OF THE REVIVED INSURANCE. NO NOTICE APPARENTLY COULD HAVE PROPERLY ISSUED TO THE PARTIES IN INTEREST UNLESS AND UNTIL THE VETERANS' BUREAU HAD ADJUDICATED THE CASE AND FINALLY DETERMINED THAT ALL THE ESSENTIAL CONDITIONS OF THE STATUTE TO AUTHORIZE THE REVIVAL OF THE INSURANCE HAD BEEN MET. THE FACTS AS STATED CLEARLY SHOW THAT THE VETERANS' BUREAU COMPLETED ITS CONSIDERATION OF THE CASE AND DID IN FACT REVIVE THE INSURANCE PRIOR TO JULY 2, 1926.

THE DECISION OF AUGUST 17, 1927, HELD THAT REVIVAL OF INSURANCE "CONTEMPLATES SOME DEFINITE ACTION TO BE TAKEN BY THE VETERANS' BUREAU.' SUCH A FINAL ADJUDICATION AND DETERMINATION AS APPARENTLY HAD BEEN MADE IN THIS CASE, AND NOTICE TO THE PARTIES IN INTEREST OF SUCH ADJUDICATION AND DETERMINATION, UNDOUBTEDLY WOULD CONSTITUTE DEFINITE ACTION, AND IT WAS IN THIS SENSE THAT THE PHRASE "AND THE MAKING OF THE AWARD" WAS USED IN THE SENTENCE QUOTED BY YOU FROM THE DECISION OF THIS OFFICE. IT WAS NOT NECESSARY THAT AN ACTUAL PAYMENT UNDER THE REVIVED INSURANCE SHOULD HAVE BEEN MADE. APPARENTLY THE VETERANS' BUREAU PLACES A DIFFERENT MEANING THAN THIS ON THE PHRASE ,MAKING OF THE AWARD" WITH RESPECT TO INSURANCE CASES. WHATEVER ITS TECHNICAL MEANING MAY BE AS USED IN THE VETERANS' BUREAU THIS OFFICE HAD NO PURPOSE OR INTENT, IN THE DECISIONS HEREINBEFORE CITED, TO USE THE PHRASE IN ANY OTHER SENSE THAN AS INDICATING THE FINAL DETERMINATION BY THE BUREAU THAT THE CONDITIONS NECESSARY TO AUTHORIZE REVIVAL OF THE INSURANCE UNDER THE STATUTE HAD BEEN MET. THUS, IN THE SYLLABUS OF THE PUBLISHED DECISION, WHEREIN IT IS ATTEMPTED TO REFLECT THE HOLDING OF THE OFFICE, IT IS STATED:

THE WORDS "HEREAFTER REVIVED" * * * MEAN INSURANCE WHICH IS REVIVED OR REINSTATED BY THE AFFIRMATIVE ACTION OF THE VETERANS' BUREAU SUBSEQUENT TO JULY 2, 1926, AND ANY SUCH INSURANCE IS SUBJECT TO THE RESTRICTED PERMITTED CLASS NAMED IN THE STATUTE.

YOU ARE ADVISED, THEREFORE, THAT UPON THE FACTS SUBMITTED, THE INSURANCE IN THIS CASE MAY BE CONSIDERED AS REVIVED PRIOR TO JULY 2, 1926, AND NOT SUBJECT TO THE RESTRICTION AS TO PAYMENT AS SET FORTH IN THE AMENDATORY ACT OF THAT DATE, PROVIDED THERE WAS AVAILABLE AT THE TIME THE ACTION TO REVIVE WAS TAKEN UNPAID DISABILITY COMPENSATION SUFFICIENT TO EFFECT SUCH REVIVAL.