B-136467, OCTOBER 7, 1958, 38 COMP. GEN. 279

B-136467: Oct 7, 1958

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MILITARY PERSONNEL - RETIRED - TEMPORARY DISABILITY RETIRED LIST - TERMINATION - ANNUITY OPTION ELECTION THE DETERMINATION THAT A NAVAL RESERVE OFFICER WHO WAS ON THE TEMPORARY DISABILITY RETIRED LIST WAS PHYSICALLY FIT FOR ACTIVE DUTY AND THE REMOVAL OF THE OFFICER FROM THE RETIRED LIST TERMINATES HIS RIGHT TO RETIRED PAY. ANY PROTECTION FOR THE MEMBER'S DEPENDENTS UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 WAS TERMINATED AT THE SAME TIME THE RETIRED PAY STATUS TERMINATED. THE REQUEST FOR ADVANCE DECISION WAS APPROVED BY THE MILITARY PAY AND ALLOWANCE COMMITTEE. IN YOUR LETTER YOU RELATE THAT LIEUTENANT SOMERS WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST ON MAY 1.

B-136467, OCTOBER 7, 1958, 38 COMP. GEN. 279

MILITARY PERSONNEL - RETIRED - TEMPORARY DISABILITY RETIRED LIST - TERMINATION - ANNUITY OPTION ELECTION THE DETERMINATION THAT A NAVAL RESERVE OFFICER WHO WAS ON THE TEMPORARY DISABILITY RETIRED LIST WAS PHYSICALLY FIT FOR ACTIVE DUTY AND THE REMOVAL OF THE OFFICER FROM THE RETIRED LIST TERMINATES HIS RIGHT TO RETIRED PAY, NOTWITHSTANDING THAT THE OFFICER DID NOT RESIGN FROM THE SERVICE UNTIL A LATER DATE, AND, THEREFORE, ANY PROTECTION FOR THE MEMBER'S DEPENDENTS UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 WAS TERMINATED AT THE SAME TIME THE RETIRED PAY STATUS TERMINATED.

TO R. A. WILSON, DEPARTMENT OF THE NAVY, OCTOBER 7, 1958:

BY LETTER DATED JUNE 12, 1958, THE JUDGE ADVOCATE GENERAL OF THE NAVY FORWARDED YOUR LETTER OF MARCH 25, 1958, REQUESTING AN ADVANCE DECISION CONCERNING THE COMPUTATION OF A REFUND IN CONNECTION WITH THE ANNUITY ELECTED BY LIEUTENANT (JG) MARVIN M. SOMERS, MC, USNR, UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953, 67 STAT. 501, IN THE CIRCUMSTANCES SHOWN, 37 U.S.C. 371 NOTE. THE REQUEST FOR ADVANCE DECISION WAS APPROVED BY THE MILITARY PAY AND ALLOWANCE COMMITTEE, DEPARTMENT OF DEFENSE, AND ASSIGNED SUBMISSION NO. 349.

IN YOUR LETTER YOU RELATE THAT LIEUTENANT SOMERS WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST ON MAY 1, 1951, PURSUANT TO THE PROVISIONS OF SECTION 402 (A) OF THE CAREER COMPENSATION ACT OF 1949, 37 U.S.C. 272 (A). ON MARCH 16, 1954, HE ELECTED OPTIONS 3 AND 4, AT ONE- HALF REDUCED RETIRED PAY UNDER THE TERMS OF THE UNIFORMED SERVICES CONTINGENCY OPTION ACT. ON APRIL 24, 1956, HE WAS FOUND FIT FOR DUTY. HOWEVER, HE DID NOT CONSENT TO REAPPOINTMENT IN THE U.S. NAVAL RESERVE AND HE RESIGNED FROM THE NAVAL RESERVE, EFFECTIVE OCTOBER 10, 1956. YOU STATE THAT SINCE 37 U.S.C. 272 (E) STIPULATED THAT A MEMBER SHALL NOT RECEIVE DISABILITY RETIRED PAY FOR A PERIOD IN EXCESS OF FIVE YEARS, LIEUTENANT SOMERS' RETIRED PAY WAS DISCONTINUED EFFECTIVE MAY 1, 1956, AND THAT DEDUCTIONS COVERING THE COST OF THE ANNUITY ELECTED WERE MADE FROM MARCH 1, 1954, THROUGH APRIL 30, 1956.

IN YOUR REQUEST FOR ADVANCE DECISION YOU MAKE REFERENCE TO OUR DECISION OF SEPTEMBER 9, 1957, B-132411, 37 COMP. GEN. 179, PERTAINING TO AN OFFICER OF THE U.S. NAVAL RESERVE WHO WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST ON MARCH 1, 1951, IN WHICH IT WAS HELD THAT THE OFFICER'S STATUS ON SUCH LIST WAS NOT IN FACT TERMINATED UNTIL SEPTEMBER 18, 1956, THE DAY PRECEDING THE DATE ON WHICH HE EXECUTED AN ACCEPTANCE AND OATH OF OFFICE IN CONNECTION WITH HIS REAPPOINTMENT AFTER A FINDING OF PHYSICAL FITNESS. WE ALSO HELD THAT, EVEN THOUGH THE OFFICER WAS NOT REMOVED FROM THE TEMPORARY DISABILITY RETIRED LIST PRIOR TO THE EXPIRATION OF THE STATUTORY FIVE-YEAR PERIOD, HE WAS NOT ENTITLED TO RETIRED PAY FOR ANY PERIOD IN EXCESS OF FIVE YEARS, SUCH HOLDING BEING BASED ON THE EXPRESS PROVISIONS OF SECTION 402 (D) OF THE CAREER COMPENSATION ACT, 37 U.S.C. 272 (D), WHICH PROHIBITED PAYMENT OF DISABILITY RETIRED PAY TO AN INDIVIDUAL FOR OVER FIVE YEARS. YOU ASK WHETHER LIEUTENANT SOMERS IS REQUIRED TO PAY THE COSTS FOR THE ANNUITY HE ELECTED, ONLY THROUGH APRIL 30, 1956, OR THROUGH OCTOBER 10, 1956, THE DATE OF HIS RESIGNATION FROM THE NAVAL SERVICE. YOU ALSO REQUEST OUR DECISION AS TO WHETHER THE DEPENDENTS OF LIEUTENANT SOMERS WERE PROVIDED PROTECTION UNDER THE CONTINGENCY OPTION ACT, SO AS TO REQUIRE THAT, IN COMPUTING ANY REFUND DUE HIM UNDER 10 U.S.C. 1439, THE COST OF TERM INSURANCE BE COMPUTED FOR THE PERIOD MARCH 1, 1954, THROUGH OCTOBER 31, 1956, THIS BEING ON THE BASIS THAT TERM INSURANCE IS NOT PRORATED FOR FRACTIONAL MONTHS.

SECTION 4 (D) OF THE CONTINGENCY OPTION ACT, NOW CODIFIED AS 10 U.S.C. 1439, PROVIDES AS OLLOWS:

IF A PERSON WHOSE NAME IS ON THE TEMPORARY DISABILITY RETIRED LIST OF AN ARMED FORCE, AND WHO HAS ELECTED AN ANNUITY UNDER THIS CHAPTER, HAS HIS NAMED REMOVED FROM THAT LIST FOR ANY REASON OTHER THAN RETIREMENT OR GRANT OF RETIRED PAY, HE IS ENTITLED TO REFUND OF THE DIFFERENCE BETWEEN THE AMOUNT BY WHICH HIS RETIRED PAY WAS REDUCED TO PROVIDE THE ANNUITY AND THE COST OF AN AMOUNT OF TERM INSURANCE EQUAL TO THE PROTECTION PROVIDED FOR HIS DEPENDENTS DURING THE PERIOD THAT HE WAS ON THAT LIST. ( ITALICS SUPPLIED.)

IN OUR DECISION OF JUNE 8, 1955, 34 COMP. GEN. 664, IT WAS HELD, IN EFFECT, THAT SINCE THE CONTINGENCY OPTION ACT PROVIDES THAT ANNUITIES FOR DEPENDENTS BE PURCHASED OUT OF RETIRED PAY, IT WAS CONTEMPLATED THAT A RETIRED MEMBER SHOULD CONTINUE IN A RETIRED PAY STATUS AFTER RETIREMENT AND, WITH THE EXCEPTION COVERED BY SECTION 5 OF THAT ACT (NOW 10 U.S.C. 1438) BE BASICALLY ENTITLED TO SUCH PAY UNTIL HIS DEATH. THE EXCEPTION PROVIDED IN SECTION 5 WAS REGARDED AS RELATING TO SITUATIONS WHERE RETIRED MEMBERS TEMPORARILY MAY NOT BE PAID THE RETIRED PAY TO WHICH THEY OTHERWISE ARE ENTITLED, SUCH AS IS THE CASE WHEN A RETIRED MEMBER IS RECALLED TO ACTIVE DUTY. SUCH MEMBER AGAIN BECOMES ENTITLED TO RETIRED PAY UPON HIS RELEASE TO INACTIVE DUTY ON THE RETIRED LIST. WHEN LIEUTENANT SOMERS WAS FOUND FIT FOR ACTIVE DUTY, HIS RIGHT TO RETIRED PAY AS FAR AS THE PHYSICAL DISABILITY FOR WHICH HIS NAME WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST WAS CONCERNED, TERMINATED PERMANENTLY ON APRIL 30, 1956. HE NO LONGER HAD ANY BASIC RIGHT TO SUCH PAY. WHETHER HE AGAIN WOULD BECOME ENTITLED TO RETIRED PAY WAS DEPENDENT ON A NUMBER OF CONTINGENCIES. WE FIND NOTHING IN THE CONTINGENCY OPTION ACT OR IN ITS LEGISLATIVE HISTORY WHICH INDICATES THAT THE CONGRESS INTENDED THAT THE PROTECTION PROVIDED DEPENDENTS OF RETIRED MEMBERS UNDER THAT ACT SHOULD ACCRUE TO THE DEPENDENTS OF A MEMBER AFTER HIS RIGHT TO RETIRED PAY HAS TERMINATED PERMANENTLY UNDER CIRCUMSTANCES SUCH AS ARE HERE INVOLVED.

ACCORDINGLY, LIEUTENANT SOMERS IS OBLIGATED, AND SHOULD BE REQUIRED, TO PAY THE COSTS OF THE ANNUITY HE ELECTED ONLY THROUGH APRIL 30, 1956. THE SECOND QUESTION IS ANSWERED BY STATING THAT LIEUTENANT SOMERS' DEPENDENTS WERE PROVIDED PROTECTION UNDER THE CONTINGENCY OPTION ACT ONLY THROUGH THAT DATE.