B-149110, JULY 16, 1962, 42 COMP. GEN. 44

B-149110: Jul 16, 1962

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PAY - RETIRED - METHOD OF COMPUTATION - BY OTHER THAN MEMBER ALTHOUGH A MEMBER OF THE ARMED FORCES WHO EXERCISES HIS RIGHT UNDER 10 U.S.C. 1431 OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN TO RECEIVE REDUCED RETIRED PAY IS NOT PRECLUDED BY SECTION 1446 (A) FROM MAKING A VALID ELECTION TO PROVIDE AN ANNUITY FOR A DEPENDENT UNDER SECTION 1434 (A). HIS BENEFICIARIES ARE ELIGIBLE FOR THE SERVICE-CONNECTED DISABILITY BENEFITS OF 38 U.S.C. THE VALID ELECTION IS INEFFECTIVE. SECTION 1446 RESTRICTING PARTICIPATION IN THE PLAN BY THE BENEFICIARIES OF MEMBERS WHO ARE RETIRED FOR PHYSICAL DISABILITY BEFORE COMPLETING 18 YEARS OF SERVICE FOR BASIC PAY PURPOSES. WHERE ON ACCOUNT OF PHYSICAL DISABILITY AN OFFICER WAS PREVENTED FROM MAKING AN ELECTION OF THE METHOD OF COMPUTATION OF HIS RETIRED PAY UNDER 10 U.S.C. 1401.

B-149110, JULY 16, 1962, 42 COMP. GEN. 44

PAY - RETIRED - ANNUITY ELECTIONS FOR DEPENDENTS - VALIDITY. PAY - RETIRED - ANNUITY ELECTIONS FOR DEPENDENTS - TERMINATION - BY OPERATION OF LAW. PAY - RETIRED - METHOD OF COMPUTATION - BY OTHER THAN MEMBER ALTHOUGH A MEMBER OF THE ARMED FORCES WHO EXERCISES HIS RIGHT UNDER 10 U.S.C. 1431 OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN TO RECEIVE REDUCED RETIRED PAY IS NOT PRECLUDED BY SECTION 1446 (A) FROM MAKING A VALID ELECTION TO PROVIDE AN ANNUITY FOR A DEPENDENT UNDER SECTION 1434 (A), UPON HIS DEATH FROM A SERVICE-CONNECTED DISABILITY, PAYMENT OF THE ANNUITY MAY NOT BE MADE TO A BENEFICIARY IN VIEW OF THE RESTRICTION IN SECTION 1446 THAT WHEN A MEMBER HAS BEEN RETIRED FOR PHYSICAL DISABILITY BEFORE COMPLETING 18 YEARS OF SERVICE FOR BASIC PAY PURPOSES, AND HIS BENEFICIARIES ARE ELIGIBLE FOR THE SERVICE-CONNECTED DISABILITY BENEFITS OF 38 U.S.C., CHAPTER 11, DEATH COMPENSATION, OR CHAPTER 13, DEPENDENCY AND INDEMNITY COMPENSATION, THE VALID ELECTION IS INEFFECTIVE. NOTWITHSTANDING THE VALIDITY OF THE ANNUITY ELECTED FOR HIS CHILD BY A COAST GUARD OFFICER UNDER SECTION 10 U.S.C. 1434 (A) (2) OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, THE ANNUITY MAY NOT BE PAID TO OR ON BEHALF OF THE CHILD, SECTION 1446 RESTRICTING PARTICIPATION IN THE PLAN BY THE BENEFICIARIES OF MEMBERS WHO ARE RETIRED FOR PHYSICAL DISABILITY BEFORE COMPLETING 18 YEARS OF SERVICE FOR BASIC PAY PURPOSES, AND WHO DIE OF A SERVICE-CONNECTED DISABILITY, AND THE FACT THAT 38 U.S.C., CHAPTER 13, DOES NOT PROVIDE FOR DIRECT PAYMENT OF THE DEPENDENCY AND INDEMNITY COMPENSATION TO OR ON BEHALF OF THE CHILD, THE OFFICER'S WIDOW SURVIVING, DOES NOT PROVIDE A BASIS FOR THE PAYMENT OF THE ANNUITY, IN VIEW OF THE PROVISION IN 38 U.S.C. 3107 FOR APPORTIONMENT OF THE CHAPTER 13 BENEFITS BETWEEN THE WIDOW AND THE CHILD. WHERE ON ACCOUNT OF PHYSICAL DISABILITY AN OFFICER WAS PREVENTED FROM MAKING AN ELECTION OF THE METHOD OF COMPUTATION OF HIS RETIRED PAY UNDER 10 U.S.C. 1401, AND HIS WIFE ACTING UNDER A POWER OF ATTORNEY ATTEMPTED TO MAKE SUCH AN ELECTION FOR THE MEMBER PRIOR TO HIS DEATH, NO OBJECTION IS PERCEIVED TO A SELECTION BY THE ADMINISTRATIVE OFFICE OF THE HIGHER OF THE TWO RATES OF RETIRED PAY ALLOWABLE UNDER THE LAW, THE MATTER BEING NOT SO MUCH THAT OF MAKING AN ELECTION AS IT IS OF COMPUTING AN INDIVIDUAL'S RETIRED PAY UNDER THE VARIOUS PROVISIONS OF LAW IN ORDER TO DETERMINE UNDER WHICH PROVISION THE GREATEST AMOUNT OF RETIRED PAY WILL RESULT.

TO F. B. ZELDER, UNITED STATES COAST GUARD, JULY 16, 1962:

BY FIRST ENDORSEMENT DATED MAY 21, 1962, THE CHIEF, PAYMENTS AND CLAIMS DIVISION, OFFICE OF THE COMMANDANT, HEADQUARTERS, UNITED STATES COAST GUARD, FORWARDED YOUR LETTER OF THE SAME DATE REQUESTING ADVANCE DECISION IN THE CASE OF RUPERT B. REYNOLDS, JR., ENSIGN, U.S. COAST GUARD, RETIRED, DECEASED, RELATIVE TO THE FOLLOWING QUESTIONS:

(A) DID MR. REYNOLDS LOSE HIS RIGHT TO ELECT FOR HIS CHILD UNDER 10 U.S.C. 1434 (A) (2), MERELY BECAUSE IF HE HAD ELECTED FOR HIS PROSPECTIVE WIDOW UNDER 10 U.S.C. 1434 (A) (1), SHE WOULD HAVE BEEN RELEGATED TO VA BENEFITS AS PRESCRIBED BY 10 U.S.C. 1446 (A) AND NOT BE ELIGIBLE TO ENJOY THE GREATER BENEFITS OF THE RETIRED SERVICEMAN'S FAMILY PROTECTIVE PLAN?

(B) IF THE ANSWER TO (A) IS IN THE NEGATIVE DID MR. REYNOLDS MAKE A VALID ELECTION?

(C) IF THE ANSWER TO (A) IS IN THE AFFIRMATIVE, CAN PAYMENT OF ANNUITY TO THE CHILD BE MADE BECAUSE OF THE PROVISIONS OF 10 U.S.C. 1446 OR MUST BENEFITS BE PAID TO THE CHILD UNDER THE PROVISIONS OF 38 U.S.C. CHAPTER 13?

(D) IS AN ACTUAL ELECTION REQUIRED OF THE MEMBER, OR HIS LEGAL REPRESENTATIVE, WHETHER COMMITTEE OR EXECUTRIX, OR MAY THE SERVICE SELECT THE HIGHER OF THE TWO ALTERNATIVE PAYS? (SEE 30 COMPTROLLER GENERAL 40, 48 IN ORDER TO DETERMINE THE PROPER AMOUNT OF RETIRED PAY DUE.)

THE FACTS OF THE CASE AS RELATED BY YOU ARE THAT MR. REYNOLDS EXECUTED AN ELECTION UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431-1446, ON OR ABOUT 8:00 A.M., FEBRUARY 1, 1962, OF OPTION 2 OF 10 U.S.C. 1434, PROVIDING FOR AN ANNUITY PAYABLE TO OR ON BEHALF OF HIS CHILD AT ONE-HALF OF HIS REDUCED RETIRED PAY. MR. REYNOLDS APPEARED BEFORE A PHYSICAL EVALUATION BOARD LATER THAT DAY AND WAS RETIRED FOR 100 PERCENT PERMANENT PHYSICAL DISABILITY ON FEBRUARY 1, 1962. HE HAD 1 YEAR, 7 MONTHS AND 23 DAYS CREDITABLE SERVICE AT THE TIME OF RETIREMENT. SHORTLY AFTER HIS RETIREMENT MR. REYNOLDS BECAME COMATOSE DUE TO HEAVY SEDATION ON ACCOUNT OF HIS TERMINAL CANCER AND HE HAD NO OPPORTUNITY PRIOR TO HIS DEATH ON MARCH 3, 1962, TO ELECT THE METHOD OF COMPUTATION OF HIS RETIRED PAY (SEE FORMULA 1, COLUMN 2, 10 U.S.C. 140). HIS WIFE ATTEMPTED TO EXECUTE AN ELECTION FOR HIM ON FEBRUARY 14, 1962, AS TO THE BASIS ON WHICH HIS RETIRED PAY SHOULD BE COMPUTED. HER ACTION WAS PURSUANT TO A POWER OF ATTORNEY DATED JANUARY 4, 1962. YOU SAY THE WIDOW IS THE EXECUTRIX NAMED IN THE MEMBER'S WILL, BUT HAS NOT YET QUALIFIED AS SUCH WITH THE FLORIDA PROBATE COURT AS FAR AS IS KNOWN.

SECTION 1446 AS ADDED TO CHAPTER 73, TITLE 10, U.S. CODE, BY SECTION 6 OF THE ACT OF OCTOBER 4, 1961, PUBLIC LAW 87-381, 75 STAT. 811, PROVIDES:

(A) NOTWITHSTANDING SECTION 1441 OF THIS TITLE IF A PERSON---

(1) HAS MADE AN ELECTION UNDER THIS CHAPTER; AND

(2) IS RETIRED FOR PHYSICAL DISABILITY BEFORE HE COMPLETES 18 YEARS OF SERVICE FOR WHICH HE IS ENTITLED TO CREDIT IN THE COMPUTATION OF HIS BASIC PAY; AND THEREAFTER DIES, HIS BENEFICIARIES ARE NOT ENTITLED TO THE ANNUITIES PROVIDED UNDER THIS CHAPTER UNTIL THEY GIVE PROOF TO THE DEPARTMENT CONCERNED THAT THEY ARE NOT ELIGIBLE FOR BENEFITS UNDER CHAPTER 11 OR 13 OF TITLE 38. IF THE BENEFICIARIES ARE NOT ELIGIBLE FOR BENEFITS UNDER CHAPTER 11 OR 13 OF TITLE 38, THE ANNUITY SHALL BEGIN ON THE FIRST DAY OF THE MONTH IN WHICH THE DEATH OCCURS.

(B) WHENEVER THE BENEFICIARIES ON WHOSE BEHALF THE ELECTION WAS MADE ARE RESTRICTED, UNDER SUBSECTION (A), FROM PARTICIPATING IN THE ANNUITIES PROVIDED UNDER THIS CHAPTER, THE AMOUNT WITHHELD FROM THE ELECTOR'S RETIRED OR RETAINER PAY AS A RESULT OF AN ELECTION UNDER THIS CHAPTER SHALL BE REFUNDED TO THE BENEFICIARIES, LESS THE AMOUNT OF ANY ANNUITIES PAID UNDER THIS CHAPTER, AND IN EITHER CASE WITHOUT INTEREST.

THE LEGISLATIVE HISTORY OF THE 1961 ACT CLEARLY SHOWS THAT IT WAS NOT THE INTENT OF THE CONGRESS TO PERMIT A CHILD OF A MEMBER HAVING SERVICE LIKE ENSIGN REYNOLDS TO RECEIVE AN ANNUITY WHERE THE WIDOW IS ELIGIBLE FOR BENEFITS PROVIDED IN CHAPTER 11 (DEATH COMPENSATION) OR 13 (DEPENDENCY AND INDEMNITY COMPENSATION) OF TITLE 38, U.S.C. SEE, FOR EXAMPLE, PAGES 12-13 OF S.REPT. 1071 ON H.R. 6668, WHICH BECAME PUBLIC LAW 87-381.

WHILE SPECIFIC PROVISION IS NOT MADE IN CHAPTER 13 OF TITLE 38, U.S. CODE, FOR PAYMENT OF THE DEPENDENCY AND INDEMNITY COMPENSATION DIRECTLY TO OR ON BEHALF OF A CHILD IF A WIDOW IS ELIGIBLE THEREFOR (SEE PAGE 10 OF S.REPT. 2380--- 84TH CONGRESS ON H.R. 7089, WHICH BECAME THE SERVICEMEN'S AND VETERANS' SURVIVOR BENEFITS ACT, NOW CODIFIED IN CHAPTER 13 OF TITLE 38, U.S. CODE), PROVISION IS MADE IN 38 U.S.C. 3107 FOR APPORTIONMENT OF SUCH COMPENSATION BETWEEN THE WIDOW AND CHILDREN IN APPROPRIATE CASES. HENCE, EVEN THE LANGUAGE OF CHAPTER 13 OF TITLE 38, U.S. CODE, DOES NOT EXCLUDE CHILDREN FROM THE DEPENDENCY AND INDEMNITY COMPENSATION WHERE A WIDOW SURVIVES. ACCORDINGLY, THE ABSENCE OF A SPECIFIC PROVISION IN THAT CHAPTER FOR DIRECT PAYMENT OF DEPENDENCY AND INDEMNITY COMPENSATION TO OR ON BEHALF OF CHILDREN WHERE A WIDOW SURVIVES DOES NOT PROVIDE A BASIS FOR PAYMENT OF AN ANNUITY TO OR ON BEHALF OF CHILDREN.

BY THE NEW SECTION 1446 THE CONGRESS RESTRICTED FROM PARTICIPATION IN THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN THE BENEFICIARIES OF ALL MEMBERS ELECTING UNDER THE PLAN WHO ARE RETIRED FOR PHYSICAL DISABILITY BEFORE COMPLETING 18 YEARS OF SERVICE FOR BASIC PAY PURPOSES AND THEREAFTER DIE OF A SERVICE-CONNECTED DISABILITY. THE LAW NOW PERMITS PARTICIPATION BY THIS BEFORE 18 YEARS' GROUP ONLY WHERE THE MEMBER DIES OF A NONSERVICE-CONNECTED DISABILITY.

WITH RESPECT TO YOUR SPECIFIC QUESTIONS, MR. REYNOLDS, ON FEBRUARY 1, 1962, HAD THE RIGHT AS A MEMBER OF THE ARMED FORCES TO ELECT UNDER 10 U.S.C. 1431 TO RECEIVE A REDUCED AMOUNT OF RETIRED PAY TO WHICH HE MIGHT BECOME ENTITLED AS A RESULT OF SERVICE IN THE U.S. COAST GUARD TO PROVIDE ANY OF THE ANNUITIES UNDER 10 U.S.C. 1434, SUBJECT IN HIS CASE, OF COURSE, TO THE RESTRICTION ON PARTICIPATION CONTAINED IN 10 U.S.C. 1446. ACCORDINGLY, QUESTION (A) IS ANSWERED IN THE NEGATIVE AND QUESTION (B) IS ANSWERED IN THE AFFIRMATIVE. THAT IS, MR. REYNOLDS MADE A VALID ELECTION WHICH WOULD HAVE BECOME EFFECTIVE MARCH 3, 1962, HAD HIS DEATH BEEN DUE TO NON-SERVICE-CONNECTED CAUSES.

QUESTION (C) IS SOMEWHAT CONFUSING IN THAT IT REFERS BACK TO QUESTION (A) WHEREAS IT APPEARS REFERENCE TO QUESTION (B) WAS INTENDED. FROM THE CONTEXT OF QUESTION (C) AND YOUR COMMENT THAT ,THE CHILD IS NOT ELIGIBLE FOR THE BENEFITS UNDER 38 U.S.C., CHAPTER 13, SINCE MR. REYNOLDS' WIDOW, THE CHILD'S MOTHER, IS STILL LIVING," APPARENTLY YOU QUESTION WHETHER THE ANNUITY CAN BE PAID TO THE CHILD AT THE SAME TIME THE WIDOW IS RECEIVING DEPENDENCY AND INDEMNITY COMPENSATION UNDER 38 U.S.C. 411. AS STATED ABOVE, IT WAS THE INTENTION OF CONGRESS TO LIMIT PARTICIPATION OF BENEFICIARIES OF MEMBERS IN MR. REYNOLDS' CATEGORY TO THOSE CASES IN WHICH THE MEMBER'S DEATH RESULTED FROM NON-SERVICE-CONNECTED DISABILITY. THUS, NO ANNUITY PAYMENT MAY BE MADE TO HIS DESIGNATED BENEFICIARY.

IT IS ASSUMED THAT QUESTION (D) RELATES TO ELECTION OF THE METHOD OF COMPUTATION OF RETIRED PAY UNDER 10 U.S.C. 1401 IN A CASE WHERE THE RETIRED MEMBER FAILED OR WAS UNABLE TO MAKE AN ELECTION. NO OBJECTION IS PERCEIVED TO A SELECTION BY THE ADMINISTRATIVE OFFICE OF THE HIGHER OF THE TWO RATES OF RETIRED PAY WHICH MAY BE ALLOWED UNDER THE LAW. AS WAS POINTED OUT IN 30 COMP. GEN. 40, 48, IT IS NOT SO MUCH A MATTER OF MAKING AN ELECTION AS IT IS OF COMPUTING AN INDIVIDUAL'S RETIRED PAY UNDER THE VARIOUS PROVISIONS OF LAW IN ORDER TO DETERMINE UNDER WHICH ONE HE WILL RECEIVE THE GREATEST RETIRED PAY. THIS IS SUPPORTED BY THE PROVISIONS OF THE THIRD SENTENCE OF 10 U.S.C. 1401. SEE, ALSO, 37 COMP. GEN. 794 AND 38 ID. 715; COMPARE 38 ID. 843. QUESTION (D) IS ANSWERED ACCORDINGLY.