B-144150, OCT. 18, 1960

B-144150: Oct 18, 1960

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TO THE SECRETARY OF DEFENSE: REFERENCE IS MADE TO LETTER DATED SEPTEMBER 30. WHEREIN DECISION IS REQUESTED ON A NUMBER OF QUESTIONS INVOLVING THE PROPER APPLICATION OF SECTION 212 OF THE ECONOMY ACT OF JUNE 30. ARE SET FORTH IN COMMITTEE ACTION NO. 273 OF THE MILITARY PAY AND ALLOWANCE COMMITTEE. IN VIEW OF THE DECISION WE HAVE REACHED WITH RESPECT TO THE APPLICATION OF THAT CASE AT THE PRESENT TIME. - WHO WAS EMPLOYED AS A CONSULTANT BY THE GOVERNMENT ON A WHEN-ACTUALLY-EMPLOYED BASIS. - WAS ENTITLED TO HIS NAVY RETIRED PAY DURING THE CALENDAR YEAR 1956. THE COURT'S OPINION WAS BASED ON THE CONCLUSION THAT WHEN BOTH PARAGRAPHS (A) AND (B) OF SECTION 212 "ARE READ TOGETHER AND INTERPRETED TOGETHER IT BECOMES CLEAR THAT IT WAS THE INTENTION OF THE CONGRESS TO MAKE THE STATUTE INAPPLICABLE TO CASES WHERE THE ACTUAL CIVILIAN PAY PLUS RETIRED PAY AMOUNTS TO LESS THAN $10.

B-144150, OCT. 18, 1960

TO THE SECRETARY OF DEFENSE:

REFERENCE IS MADE TO LETTER DATED SEPTEMBER 30, 1960, FROM THE ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER), WHEREIN DECISION IS REQUESTED ON A NUMBER OF QUESTIONS INVOLVING THE PROPER APPLICATION OF SECTION 212 OF THE ECONOMY ACT OF JUNE 30, 1932, AS AMENDED, 5 U.S.C. 59A, IN VIEW OF THE OPINION RENDERED BY THE COURT OF CLAIMS IN THE CASE OF SCHUYLER V. UNITED STATES, CT.CL.NO. 548-58, DECIDED JANUARY 20, 1960. THE QUESTIONS, TOGETHER WITH A DISCUSSION PERTAINING THERETO, ARE SET FORTH IN COMMITTEE ACTION NO. 273 OF THE MILITARY PAY AND ALLOWANCE COMMITTEE, DEPARTMENT OF DEFENSE.

ALL OF THE QUESTIONS PRESENTED FOR DECISION APPEAR TO INVOLVE THE APPLICATION OF THE VIEWS EXPRESSED BY THE COURT IN THE SCHUYLER CASE INSOFAR AS THEY REFER TO SECTION 212 OF THE ECONOMY ACT. IN VIEW OF THE DECISION WE HAVE REACHED WITH RESPECT TO THE APPLICATION OF THAT CASE AT THE PRESENT TIME, IT SEEMS UNNECESSARY TO QUOTE AND INDIVIDUALLY CONSIDER THE SEVERAL QUESTIONS.

THE COURT HELD IN THE SCHUYLER CASE THAT THE PLAINTIFF--- WHO WAS EMPLOYED AS A CONSULTANT BY THE GOVERNMENT ON A WHEN-ACTUALLY-EMPLOYED BASIS, AT THE RATE OF $50 PER DAY, WITH A LIMIT OF 130 DAYS' EMPLOYMENT PER YEAR--- WAS ENTITLED TO HIS NAVY RETIRED PAY DURING THE CALENDAR YEAR 1956, NOTWITHSTANDING THE FACT THAT HIS COMBINED CIVILIAN COMPENSATION AND RETIRED PAY EXCEEDED THE RATE OF $10,000 PER ANNUM. THE COURT'S OPINION WAS BASED ON THE CONCLUSION THAT WHEN BOTH PARAGRAPHS (A) AND (B) OF SECTION 212 "ARE READ TOGETHER AND INTERPRETED TOGETHER IT BECOMES CLEAR THAT IT WAS THE INTENTION OF THE CONGRESS TO MAKE THE STATUTE INAPPLICABLE TO CASES WHERE THE ACTUAL CIVILIAN PAY PLUS RETIRED PAY AMOUNTS TO LESS THAN $10,000.'

THE CONCLUSION REACHED BY THE COURT IS INCONSISTENT WITH OUR CONTEMPORANEOUS AND CONSISTENT CONSTRUCTION OF SECTION 212, NAMELY, THAT IT IS THE ANNUAL RATE OF CIVILIAN COMPENSATION AND RETIRED PAY WHICH IS CONTROLLING IN SUCH CASES. CF. 12 COMP. GEN. 256 AND 38 COMP. GEN. 774. THE COURT, HOWEVER, WENT NO FURTHER THAN TO CONCLUDE THE THE ECONOMY ACT SHOULD NOT APPLY TO THE PLAINTIFF IN THE SCHUYLER CASE DURING THE CALENDAR YEAR 1956 (JANUARY 1 TO DECEMBER 31, 1956), BECAUSE DURING THAT YEAR HE DID NOT RECEIVE A TOTAL AMOUNT, REPRESENTING CIVILIAN COMPENSATION AND RETIRED PAY, IN EXCESS OF $10,000. THE COURT'S OPINION DOES NOT INDICATE THAT THE TERM OF THE PLAINTIFF'S EMPLOYMENT WAS CONSIDERED OR THAT THE BEGINNING OF THE CALENDAR YEAR (1956) HAD ANY RELATIONSHIP TO THE ANNIVERSARY DATE OF HIS EMPLOYMENT. THAT CALENDAR YEAR APPARENTLY WAS USED BY THE PLAINTIFF AS A BASIS FOR HIS SUIT ONLY BECAUSE HE ACTUALLY DID NOT RECEIVE A TOTAL AMOUNT IN EXCESS OF $10,000 FOR THAT PARTICULAR PERIOD. SECTION 212 DOES NOT INDICATE THAT SUBSECTION (B) THEREOF SHOULD BE APPLIED ON A CALENDAR YEAR BASIS RATHER THAN ON THE BASIS OF AN EMPLOYMENT YEAR OR SOME OTHER YEAR, AND IT IS NOT CLEAR FROM THE COURT'S OPINION WHAT ACTION IT MIGHT TAKE IN A SIMILAR CASE IF THE COMBINED AMOUNT OF CIVILIAN COMPENSATION AND RETIRED PAY EXCEEDED $10,000 FOR A SINGLE EMPLOYMENT YEAR BUT THE COMBINED AMOUNT FOR EITHER OF THE PARTS OF THE TWO CALENDAR YEARS INVOLVED DID NOT EXCEED $10,000. ALSO, UNDER THE INTERPRETATION WHICH THE COURT MADE IN THE SCHUYLER CASE THE RETIRED PAY RIGHTS IN MOST OF THE DUAL COMPENSATION CASES WOULD NOT BE DEFINITELY KNOWN OR FIXED UNTIL NEAR THE END OF SOME ANNUAL PERIOD.

IN VIEW OF THE MANY UNCERTAINTIES AS TO THE GENERAL INTERPRETATION WHICH SHOULD BE GIVEN SECTION 212 UNDER THE DECISION REACHED IN THE SCHUYLER CASE, WE HAVE TAKEN THE VIEW THAT UNTIL THE DECISION IN THAT CASE HAS BEEN EXPLAINED OR AMPLIFIED BY THE COURTS THERE WOULD BE NO BASIS FOR CHANGING THE PRIOR DECISIONS RELATING TO THE APPLICATION OF SECTION 212 ON THE BASIS OF THAT DECISION. IT HAS BEEN DETERMINED, THEREFORE, THAT THE RULES SET FORTH IN OUR PRIOR DECISIONS (SEE 38 COMP. GEN. 774) WILL CONTINUE TO BE APPLIED PENDING A CLARIFICATION OF THE POSITION TAKEN BY THE COURTS IN THE SCHUYLER CASE. SEE B-136959, B-143431, DATED SEPTEMBER 29, 1960, 40 COMP. GEN. 193.