B-152446, SEP. 23, 1963

B-152446: Sep 23, 1963

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO LETTER DATED SEPTEMBER 6. IT APPEARS THAT THE MEMBER WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST EFFECTIVE JANUARY 11. SINCE THE MEMBER WAS MENTALLY INCOMPETENT AND THEREFORE UNABLE TO MAKE AN ELECTION UNDER THE PROVISIONS OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN. ANNUITY PAYMENTS WERE ESTABLISHED IN FAVOR OF MRS. SUCH PAYMENTS WERE STOPPED WHEN IT WAS DISCOVERED THAT AN AWARD OF DEPENDENCY AND INDEMNITY COMPENSATION HAD BEEN MADE TO HER IN THE AMOUNT OF $138 PER MONTH EFFECTIVE FEBRUARY 3. THIS AWARD WAS PENDING IN MARCH 1962 WHEN MRS. O-NEILL REQUESTED TO BE ADVISED WHETHER SHE WAS ALSO ELIGIBLE FOR AN ANNUITY UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN.

B-152446, SEP. 23, 1963

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO LETTER DATED SEPTEMBER 6, 1963, FROM THE UNDER SECRETARY OF THE NAVY, REQUESTING CONSIDERATION OF THE REQUEST FOR WAIVER OF RECOVERY OF CERTAIN ERRONEOUS ANNUITY PAYMENTS MADE TO MRS. BERNICE M. O-NEILL, AS WIDOW OF ANTHONY O-NEILL, 444 31 31, HM2, USN (RETIRED) (DECEASED), IN THE NET AMOUNT OF $1,030.74.

IT APPEARS THAT THE MEMBER WAS PLACED ON THE TEMPORARY DISABILITY RETIRED LIST EFFECTIVE JANUARY 11, 1962. SINCE THE MEMBER WAS MENTALLY INCOMPETENT AND THEREFORE UNABLE TO MAKE AN ELECTION UNDER THE PROVISIONS OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431-1446, MRS. O-NEILL REQUESTED THE SECRETARY OF THE NAVY TO MAKE AN ELECTION FOR HIM AS PROVIDED BY 10 U.S.C. 1433. ON JANUARY 11, 1962, THE SECRETARY ELECTED OPTION (3) IN ORDER TO PROVIDE AN ANNUITY FOR MRS. O-NEILL AT THE RATE OF ONE-HALF OF THE MEMBER'S REDUCED RETIRED PAY UNTIL HER REMARRIAGE OR DEATH, AND THEREAFTER TO THE MEMBER'S TWO MINOR CHILDREN UNTIL THEY ATTAIN THE AGE OF 18 OR UNTIL THEIR MARRIAGE OR DEATH.

FOLLOWING THE MEMBER'S DEATH ON FEBRUARY 2, 1962, ANNUITY PAYMENTS WERE ESTABLISHED IN FAVOR OF MRS. O-NEILL AT THE RATE OF $74.11 PER MONTH FROM FEBRUARY 1, 1962, TO MARCH 31, 1963. SUCH PAYMENTS WERE STOPPED WHEN IT WAS DISCOVERED THAT AN AWARD OF DEPENDENCY AND INDEMNITY COMPENSATION HAD BEEN MADE TO HER IN THE AMOUNT OF $138 PER MONTH EFFECTIVE FEBRUARY 3, 1962, BY THE VETERANS ADMINISTRATION. THIS AWARD WAS PENDING IN MARCH 1962 WHEN MRS. O-NEILL REQUESTED TO BE ADVISED WHETHER SHE WAS ALSO ELIGIBLE FOR AN ANNUITY UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN. IT APPEARS THAT SHE DID NOT NEGOTIATE THE ANNUITY CHECKS UNTIL SHE WAS ADVISED BY THE DEPARTMENT OF THE NAVY THAT SHE WAS AUTHORIZED TO RECEIVE BOTH PAYMENTS.

THE ACT OF OCTOBER 4, 1961, PUB.L. 87-381, 75 STAT. 811, 10 U.S.C. 1446, PROVIDES THAT THE BENEFICIARIES ARE NOT ENTITLED TO AN ANNUITY UNDER THE PROVISIONS OF THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN UNTIL THEY GIVE PROOF TO THE DEPARTMENT CONCERNED THAT THEY ARE NOT ELIGIBLE FOR THE BENEFITS PROVIDED UNDER CHAPTER 11 (DEATH COMPENSATION) OR 13 (DEPENDENCY AND INDEMNITY COMPENSATION) OF TITLE 38, U.S.C. THE TOTAL OVERPAYMENT TO MRS. O-NEILL AMOUNTED TO $1,037.54, LESS $6.80, REPRESENTING A REFUND OF DEDUCTIONS FROM THE RETIRED PAY OF THE MEMBER FOR THE PERIOD JANUARY 11 THROUGH FEBRUARY 2, 1962, OR A NET OVERPAYMENT IN THE AMOUNT OF $1,030.74.

UNDER 10 U.S.C. 1442, THERE NEED BE NO RECOVERY OF SUCH ERRONEOUS PAYMENTS WHEN, IN THE JUDGMENT OF THE SECRETARY CONCERNED AND THE COMPTROLLER GENERAL OF THE UNITED STATES,"THERE HAS BEEN NO FAULT BY THE PERSON TO WHOM THE AMOUNT WAS ERRONEOUSLY PAID AND RECOVERY WOULD BE CONTRARY TO THE PURPOSES OF THIS CHAPTER OR AGAINST EQUITY AND GOOD CONSCIENCE.'

IN 35 COMP. GEN. 401, IN CONSTRUING SUCH PROVISIONS, WE HELD THAT SOMETHING MORE THAN FREEDOM FROM FAULT MUST BE SHOWN BEFORE A BASIS EXISTS FOR EXERCISING A JUDGMENT AS TO WHETHER COLLECTION OF A PARTICULAR OVERPAYMENT OR ERRONEOUSLY PAYING SHOULD BE WAIVED; THAT UNLESS IT CAN BE ESTABLISHED THAT COLLECTION OF THE OVERPAYMENT WOULD WORK AN UNDUE HARDSHIP, OR SOME OTHER REASON CAN BE SHOWN AS TO WHY COLLECTION SHOULD NOT BE MADE, IT IS BELIEVED THAT NO PROPER BASIS EXISTS FOR EXERCISE OF THE WAIVER AUTHORITY.

IT IS OUR VIEW THAT THE RECORD CONTAINS SUFFICIENT INFORMATION FROM WHICH IT MAY BE CONCLUDED THAT COLLECTION WOULD WORK AN UNDUE HARDSHIP ON THE WIDOW AND MINOR CHILDREN OF THE DECEASED SERVICEMAN CONTRARY TO THE PURPOSE OF THE LAW. ACCORDINGLY, IN THE LIGHT OF THE OTHER FACTS AND CIRCUMSTANCES, WE CONCUR IN YOUR JUDGMENT THAT RECOVERY OF THE ERRONEOUS PAYMENTS WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE AND SHOULD BE WAIVED IN THIS CASE.