B-141963, MAR. 3, 1960

B-141963: Mar 3, 1960

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NAVY FINANCE CENTER: REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 16. IT IS STATED THAT CLYDE E. HE WAS AN ACTIVE MEMBER WHO HAD COMPLETED 18 YEARS OF SERVICE WHEN THE LAW WAS ENACTED. THUS WAS WITHIN THE SCOPE OF SECTION 3 (A) OF THE ACT. PRIOR TO THE COMPLETION OF EIGHTEEN YEARS OF SERVICE WHICH IS CREDITABLE IN THE COMPUTATION OF ACTIVE-DUTY PAY IN THE UNIFORMED SERVICE OF WHICH HE IS A MEMBER. OR CHILDREN ARE LIVING AT THE DATE OF HIS RETIREMENT. * * * AN ACTIVE MEMBER WHO HAS HERETOFORE COMPLETED THE EIGHTEEN YEARS OF SERVICE MAY MAKE THIS ELECTION WITHIN ONE YEAR AFTER THE EFFECTIVE DATE OF THIS CHAPTER. * * * THE TERMS OF THE ELECTION MAY BE MODIFIED OR REVOKED BY A MEMBER AT ANY TIME PRIOR TO HIS RETIREMENT BUT ANY MODIFICATION OR REVOCATION SO MADE SHALL NOT BE EFFECTIVE IF HE RETIRED WITHIN FIVE YEARS AFTER THE DATE IT IS MADE.

B-141963, MAR. 3, 1960

TO R. A. WILSON, DISBURSING OFFICER, SPECIAL PAYMENTS DEPARTMENT, U.S. NAVY FINANCE CENTER:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 16, 1959, WITH ENCLOSURES, FORWARDED HERE UNDER SUBMISSION NO. DO-N-479 (ASSIGNED BY THE DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE) REQUESTING DECISION AS TO THE VALIDITY OF AN ELECTION UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953, 67 STAT. 501, NOW CODIFIED IN CHAPTER 73, TITLE 10, U.S.C.

IT IS STATED THAT CLYDE E. BARNHILL, CSC (SS) USNFR, HAD UNTIL NOVEMBER 1, 1954 (ONE YEAR AFTER EFFECTIVE DATE OF THE ABOVE ACT) TO EXERCISE AN ELECTION UNDER ITS PROVISIONS. PRESUMABLY, HE WAS AN ACTIVE MEMBER WHO HAD COMPLETED 18 YEARS OF SERVICE WHEN THE LAW WAS ENACTED, AND THUS WAS WITHIN THE SCOPE OF SECTION 3 (A) OF THE ACT, AS AMENDED, 37 U.S.C. 372 (A), SUPP. II, 1952 EDITION, WHICH PROVIDED, IN PERTINENT PART:

"AN ACTIVE MEMBER MAY ELECT, PRIOR TO THE COMPLETION OF EIGHTEEN YEARS OF SERVICE WHICH IS CREDITABLE IN THE COMPUTATION OF ACTIVE-DUTY PAY IN THE UNIFORMED SERVICE OF WHICH HE IS A MEMBER, TO RECEIVE A REDUCED AMOUNT OF ANY RETIRED PAY WHICH MAY BE AWARDED HIM AS THE RESULT OF SERVICE IN HIS UNIFORMED SERVICE IN ORDER TO PROVIDE ONE OR MORE OF THE ANNUITIES SPECIFIED IN SECTION 373 OF THIS TITLE, PAYABLE AFTER HIS DEATH IN A RETIRED STATUS TO HIS WIDOW, CHILD, OR CHILDREN, IF SUCH WIDOW, CHILD, OR CHILDREN ARE LIVING AT THE DATE OF HIS RETIREMENT. * * * AN ACTIVE MEMBER WHO HAS HERETOFORE COMPLETED THE EIGHTEEN YEARS OF SERVICE MAY MAKE THIS ELECTION WITHIN ONE YEAR AFTER THE EFFECTIVE DATE OF THIS CHAPTER. * * * THE TERMS OF THE ELECTION MAY BE MODIFIED OR REVOKED BY A MEMBER AT ANY TIME PRIOR TO HIS RETIREMENT BUT ANY MODIFICATION OR REVOCATION SO MADE SHALL NOT BE EFFECTIVE IF HE RETIRED WITHIN FIVE YEARS AFTER THE DATE IT IS MADE. ANY MEMBER WHO REVOKES AN ELECTION SHALL NOT THEREAFTER BE PERMITTED TO WITHDRAW OR MODIFY HIS REVOCATION AND AFTER IT BECOMES EFFECTIVE, HE SHALL NOT BE PERMITTED TO BE COVERED IN ANY WAY BY THIS CHAPTER.'

IT APPEARS THAT IN SEPTEMBER 1954, BARNHILL SUBMITTED TO THE NAVAL SUBMARINE BASE, NEW LONDON, CONNECTICUT, A SIGNED ELECTION FORM--- DENOMINATED A "ROUGH" FORM--- FILLED IN BY HAND, STATING THAT HE DESIRED OPTION 2 (ANNUITY TO SURVIVING CHILDREN) AT ONE-HALF HIS REDUCED RETIRED PAY TOGETHER WITH OPTION 4 (NO FURTHER DEDUCTIONS TO BE MADE FROM RETIRED PAY FOLLOWING THE MONTH IN WHICH THERE WOULD BE NO BENEFICIARY ELIGIBLE TO RECEIVE AN ANNUITY UPON THE MEMBER'S DEATH). THE FORM INCLUDED INFORMATION AS TO THE NAME OF BARNHILL'S WIFE, HER DATE OF BIRTH, AND THE DATE OF THEIR MARRIAGE, AS WELL AS INFORMATION AS TO THE NAMES AND DATES OF BIRTH OF HIS CHILDREN. IT APPEARS THAT ON SEPTEMBER 24, 1954, BARNHILL ALSO SIGNED AN ELECTION FORM IN BLANK, TO BE COMPLETED BY TYPING IN THE INFORMATION CONTAINED ON THE "ROUGH" FORM. THE BLANK FORM BEARS THE SIGNATURE OF THE PERSONNEL OFFICER AND INDICATES THAT IT WAS SUBSCRIBED AND SWORN TO BEFORE HIM ON THAT DATE. IT ALSO APPEARS THAT WHEN THE TYPING WAS DONE, THE TYPIST FILLED IN THE BLANK FORMS TO REFLECT THE CHOICE OF OPTION 3 (ANNUITY TO WIFE AND CHILDREN) TOGETHER WITH OPTION 4. IT FURTHER APPEARS THAT WHEN A COPY OF THE TYPED FORM WAS SENT TO BARNHILL HE CALLED ATTENTION TO THE DISCREPANCIES BETWEEN THE ENTRIES IN THE "ROUGH" FORM AND THE ENTRIES ON THE TYPED FORM AND THAT HE THEN WAS ALLOWED TO EXECUTE A NEW TYPED FORM--- DENOMINATED A "CORRECTED COPY"--- SUBSCRIBED AND SWORN TO ON OCTOBER 10, 1954, ELECTING OPTIONS 2 AND 4, HIS ORIGINAL INTENTION AS EXPRESSED IN THE "ROUGH" FORM.

IT IS STATED THAT BARNHILL WAS TRANSFERRED TO THE FLEET RESERVE ON JUNE 29, 1956; THAT BEGINNING JUNE 30, 1956, DEDUCTIONS HAVE BEEN MADE FROM HIS RETAINER PAY AT THE RATE OF $1.16 PER MONTH ON THE BASIS OF OPTIONS 2 AND 4; THAT IN JUNE 1959 HIS CASE WAS REVIEWED AND IT WAS DETERMINED, IN VIEW OF 33 COMP. GEN. 460, THAT HIS SECOND ELECTION WAS INVALID AND THAT DEDUCTIONS SHOULD HAVE BEEN MADE ON THE BASIS OF OPTIONS 3 AND 4 AT THE RATE OF $14.69 PER MONTH; THAT, ACCORDINGLY, IT WAS DETERMINED THAT THE COSTS OF HIS OPTIONS HAD BEEN UNDERPAID $474; AND THAT THIS AMOUNT IS BEING OFFSET ON A MONTHLY INSTALLMENT BASIS.

THERE WAS CONSIDERED IN 33 COMP. GEN. 460, CITED IN YOUR LETTER, THE CASE OF AN ATTEMPTED MODIFICATION OF AN ELECTION UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 BY A MEMBER RETIRED PRIOR TO ITS ENACTMENT AND THUS WITHIN THE SCOPE OF SECTION 3 (B) OF THE ACT, 37 U.S.C. 372 (B), WHICH PROVIDED IN PART THAT "AN ELECTION SO MADE SHALL THEREAFTER BE IRREVOCABLE.'

YOUR LETTER INCORPORATES THE FOLLOWING QUOTATION FROM 33 COMP. GEN. 460, 463:

"WITH RESPECT TO THE CASE OF FIRST SERGEANT BRIGGS, WHO ALLEGES THAT THE STENOGRAPHER CHECKED ELECTION 4 BY MISTAKE WHEREAS HE INTENDED TO ELECT OPTION 1 ONLY, RATHER THAN 1 WITH 4, IT MAY BE STATED THAT HE IS PRESUMED TO HAVE READ THE TYPED ELECTION FORM PRIOR TO SIGNING IT AND THAT IF A MISTAKE WAS MADE IT DID NOT RESULT FROM ANY ACTION OR INACTION ON THE PART OF THE GOVERNMENT. SINCE THE MISTAKE, IF ANY, WAS UNILATERAL AND WAS NOT CORRECTED PRIOR TO THE DATE THE ELECTION BECAME EFFECTIVE, THE SAID ELECTION BECAME IRREVOCABLE AND NOT SUBJECT TO MODIFICATION IN VIEW OF THE PLAIN TERMS OF SECTION 3 (B) OF THE CONTINGENCY OPTION ACT, AS QUOTED ABOVE.'

DECISION IS REQUESTED WHETHER OPTION COSTS IN BARNHILL'S CASE MAY BE RECOMPUTED AS OF JUNE 30, 1956, ON HIS "SECOND ELECTION," ON THE BASIS THAT IT WAS A CORRECTION OF THE INITIAL ELECTION RATHER THAN A MODIFICATION.

IN 33 COMP. GEN. 455, WE CONSIDERED THE CASE OF A RETIRED MEMBER WHO, WITHIN THE PRESCRIBED PERIOD OF ELECTION, WROTE TWO LETTERS TO THE FIELD BRANCH, BUREAU OF SUPPLIES AND ACCOUNTS, DEPARTMENT OF THE NAVY, IN WHICH HE STATED THAT HE WISHED TO MAKE AN ELECTION UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 TO PROVIDE THE MAXIMUM BENEFIT FOR HIS DEPENDENT WIFE; AND WHO, STILL WITHIN THE PRESCRIBED PERIOD, SUBSEQUENTLY REQUESTED BY LETTER THAT HIS PREVIOUS TWO LETTERS BE DISREGARDED. UPON HIS DEATH, SOME SIX WEEKS AFTER THE LAST LETTER, THE QUESTION WAS PRESENTED TO US WHETHER THE FIRST TWO LETTERS CONSTITUTED A VALID ELECTION "OR SHOULD THIS ELECTION HAVE BEEN MADE AN ENCLOSURE (4) (PRINTED ELECTION FORM) COMPLETE WITH NOTARIZATION AS PRESCRIBED BY THE NAVY DEPARTMENT.' IT WAS HELD THAT A VALID IRREVOCABLE ELECTION HAD BEEN MADE, IT BEING SAID AT PAGES 457 AND 458 OF THE DECISION THAT:

"THE ELECTION UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 IS NOT VIEWED AS INVALID BECAUSE OF THE FACT THAT IT WAS NOT EXECUTED ON THE FORM PRESCRIBED FOR REGISTERING ELECTIONS UNDER SUCH ACT. NO LANGUAGE HAS BEEN FOUND IN THE SAID 1953 ACT REQUIRING THAT THE ELECTIONS AUTHORIZED THEREUNDER BE SUBMITTED IN ANY PARTICULAR MANNER OR ON ANY PARTICULAR FORM AND THE APPLICABLE REGULATIONS WHICH RECENTLY HAVE BEEN PRESCRIBED IN ACCORDANCE WITH SUCH ACT SPECIFY THAT FOR AN ELECTION TO BE EFFECTIVE--- IN THE CASE OF A RETIRED MEMBER NOT ON ACTIVE DUTY--- IT NEED ONLY BE SIGNED AND POSTMARKED NOT LATER THAN APRIL 30, 1954. * * *"

ALSO, COMPARE B-141121, DECEMBER 22, 1959, 39 COMP. GEN. - .

THE "ROUGH" FORM EXECUTED BY BARNHILL CLEARLY SHOWED HIS INTENT WITH RESPECT TO AN ELECTION UNDER THE CONTINGENCY OPTION ACT. WHILE IT APPEARS THAT SUCH FORM WAS NOT FORWARDED TO THE PROPER ADMINISTRATIVE OFFICE TO EFFECTUATE HIS ELECTION, THE NAVAL SUBMARINE BASE AT NEW LONDON WAS NOT AUTHORIZED BY HIM TO FORWARD ANY OTHER PAPER PURPORTING TO BE HIS ELECTION, WHICH EXPRESSED A DIFFERENT INTENT. THE FORM SIGNED SEPTEMBER 24, 1954, WAS NOT HIS ELECTION AND WAS OF NO EFFECT. THE "CORRECTED COPY" STATED HIS ORIGINAL INTENT AND DEDUCTIONS FROM HIS RETAINER PAY FOLLOWING HIS TRANSFER TO THE FLEET RESERVE, ON THE BASIS OF OPTIONS 2 AND 4, WERE PROPERLY MADE. APPROPRIATE ACTION SHOULD BE TAKEN TO PAY HIM ANY EXCESS AMOUNTS WHICH HAVE BEEN WITHHELD FROM HIS RETAINER PAY.