B-158395, MAR. 9, 1966

B-158395: Mar 9, 1966

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RETIRED: REFERENCE IS MADE TO THE LETTER OF JANUARY 7. IT IS ALLEGED THAT IT WAS IMPROPER TO DENY THAT PORTION OF YOUR CLAIM COVERING THE PERIOD FROM DATE OF RETIREMENT. ON THE GROUND THAT THE CLAIM WAS NOT TIMELY FILED. THE RECORD SHOWS THAT YOU WERE TRANSFERRED TO THE FLEET RESERVE ON APRIL 3. WHICH WAS CREDITED AS 21 YEARS. FROM THE DATE OF TRANSFER UNTIL YOU WERE RECALLED TO ACTIVE DUTY YOU RECEIVED RETAINER PAY COMPUTED IN ACCORDANCE WITH SECTION 203 OF THE NAVAL RESERVE ACT AND UPON RELEASE JANUARY 15. YOU BECAME ENTITLED TO HAVE YOUR RETAINER PAY INCREASED BY THE PERIOD OF ACTIVE DUTY AFTER TRANSFER ONLY IF SUCH RETAINER PAY WAS COMPUTED UNDER SECTION 516 OF THE CAREER COMPENSATION ACT OF 1949.

B-158395, MAR. 9, 1966

TO MR. HERMAN C. HARRIS, USN, RETIRED:

REFERENCE IS MADE TO THE LETTER OF JANUARY 7, 1966, FROM YOUR ATTORNEY, REQUESTING REVIEW OF THE SETTLEMENT ISSUED BY THE CLAIMS DIVISION OF OUR OFFICE IN YOUR FAVOR UNDER DATE OF NOVEMBER 18, 1965, IN THE AMOUNT OF $2,354.36, REPRESENTING INCREASED RETIRED PAY FOR THE PERIOD JUNE 29, 1955, TO MAY 20, 1965, INCLUSIVE, BASED ON THE DECISION IN THE CASE OF CLARK, ET AL. V. UNITED STATES, 150 CT.CL. 470 (1960). IN VIEW OF THE CORRECTION OF YOUR RECORDS UNDER AUTHORITY OF 10 U.S.C. 1552, IT IS ALLEGED THAT IT WAS IMPROPER TO DENY THAT PORTION OF YOUR CLAIM COVERING THE PERIOD FROM DATE OF RETIREMENT, AUGUST 1, 1954, TO JUNE 28, 1955, ON THE GROUND THAT THE CLAIM WAS NOT TIMELY FILED.

THE RECORD SHOWS THAT YOU WERE TRANSFERRED TO THE FLEET RESERVE ON APRIL 3, 1946, WITH 20 YEARS, 10 MONTHS AND 16 DAYS OF SERVICE, WHICH WAS CREDITED AS 21 YEARS, 8 MONTHS AND 13 DAYS FOR THE PURPOSE OF TRANSFER INCLUDING 9 MONTHS AND 27 DAYS OF CONSTRUCTIVE TIME CREDITABLE UNDER SECTION 202 OF THE NAVAL RESERVE ACT OF 1938, APPROVED JUNE 25, 1938, CH. 690, 52 STAT. 1178. YOU AGAIN SERVED ON ACTIVE DUTY FROM DECEMBER 27, 1950, TO JANUARY 15, 1953, INCLUSIVE, A PERIOD OF 2 YEARS AND 19 DAYS WHICH, WHEN ADDED TO YOUR SERVICE AT TRANSFER, MAKES A TOTAL OF 22 YEARS, 11 MONTHS AND 5 DAYS OF ACTUAL SERVICE OR 23 YEARS, 9 MONTHS AND 2 DAYS INCLUDING CONSTRUCTIVE TIME.

FROM THE DATE OF TRANSFER UNTIL YOU WERE RECALLED TO ACTIVE DUTY YOU RECEIVED RETAINER PAY COMPUTED IN ACCORDANCE WITH SECTION 203 OF THE NAVAL RESERVE ACT AND UPON RELEASE JANUARY 15, 1953, YOU BECAME ENTITLED TO HAVE YOUR RETAINER PAY INCREASED BY THE PERIOD OF ACTIVE DUTY AFTER TRANSFER ONLY IF SUCH RETAINER PAY WAS COMPUTED UNDER SECTION 516 OF THE CAREER COMPENSATION ACT OF 1949, APPROVED OCTOBER 12, 1949, CH. 681, 63 STAT. 832. THE FORMULA THERE PRESCRIBED REQUIRED MULTIPLYING BY 2 1/2 PERCENT THE YEARS OF SERVICE CREDITABLE TO YOU FOR THE PURPOSE OF COMPUTING YOUR RETAINER PAY AT THE TIME OF YOUR TRANSFER TO THE FLEET RESERVE PLUS THE NUMBER OF YEARS OF SUBSEQUENT ACTIVE SERVICE AND MULTIPLYING THE PRODUCT THUS OBTAINED BY THE APPLICABLE RATE OF ACTIVE DUTY PAY. IN THE CASE OF WHITE V. UNITED STATES, 121 CT.CL. 1 (1951), IT WAS HELD THAT CONSTRUCTIVE TIME CREDITABLE UNDER SECTION 202 OF THE NAVAL RESERVE ACT WAS CREDITABLE FOR THE PURPOSE OF DETERMINING THE PERCENTAGE MULTIPLE TO BE USED IN COMPUTING RETAINER PAY OR RETIRED PAY UNDER THE 2 1/2 PERCENT FORMULA PRESCRIBED IN SECTION 204 OF THAT ACT AS AMENDED BY SECTION 2 OF THE ACT OF AUGUST 10, 1946, CH. 952, 60 STAT. 993. IN 31 COMP. GEN. 547, WE HELD, IN EFFECT, THAT IN COMPUTING RETIRED PAY UNDER SECTION 516 OF THE CAREER COMPENSATION ACT THE PERCENTAGE MULTIPLE FACTOR SHOULD BE DETERMINED BY ADDING THE MEMBER'S ACTIVE SERVICE AFTER RETIREMENT TO THE SERVICE CREDITABLE AT THE TIME OF RETIREMENT EVEN THOUGH THE SERVICE CREDITABLE TO HIM AT THE TIME OF RETIREMENT MIGHT INCLUDE PERIODS WHICH WOULD NOT BE CREDITABLE UNDER SECTION 511 OF THE CAREER COMPENSATION ACT. ACCORDINGLY, THE PERCENTAGE MULTIPLE APPLICABLE IN COMPUTING YOUR RETIRED PAY AFTER JANUARY 15, 1953,WAS 60 BASED ON 23 YEARS, 9 MONTHS AND 2 DAYS OF SERVICE (INCLUDING CONSTRUCTIVE TIME), COUNTED AS 24 YEARS BY REASON OF CREDITING A FRACTION OF A YEAR OF 6 MONTHS OR MORE AS A WHOLE YEAR.

ON AUGUST 1, 1954, YOU WERE TRANSFERRED FROM THE FLEET RESERVE TO THE RETIRED LIST OF THE NAVY PURSUANT TO THE PROVISIONS OF SECTION 204 OF THE NAVAL RESERVE ACT, AS AMENDED, WHICH AUTHORIZED MEMBERS OF THE FLEET RESERVE TO BE TRANSFERRED TO THE RETIRED LIST UPON COMPLETION OF 30 YEARS OF SERVICE "WITH THE PAY THEY WERE THEN LEGALLY ENTITLED TO RECEIVE.' SINCE YOU WERE THEN LEGALLY ENTITLED TO RECEIVE RETAINER PAY COMPUTED UNDER SECTION 516 OF THE CAREER COMPENSATION ACT, YOUR TRANSFER TO THE RETIRED LIST ENTITLED YOU TO RECEIVE THE SAME AMOUNT OF MONEY, THEREAFTER DESIGNATED AS RETIRED PAY. HOWEVER, CONCURRENTLY WITH YOUR RETIREMENT YOU WERE ADVANCED TO THE GRADE OF LIEUTENANT (JG) UNDER AUTHORITY OF SECTION 10/B) (2) OF THE ACT OF JULY 24, 1941, CH. 320, 55 STAT. 605, AS AMENDED BY SECTION 8 OF THE ACT OF FEBRUARY 21, 1946, CH. 34, 60 STAT. 28, WHICH ENTITLED YOU TO RECEIVE RETIRED PAY "COMPUTED AT THE RATE PRESCRIBED BY LAW AND APPLICABLE IN EACH INDIVIDUAL CASE BUT BASED UPON SUCH HIGHER RANK.' ACCORDINGLY, YOUR RETIRED PAY WAS AUTHORIZED TO BE COMPUTED ON THE RATE OF PAY FOR A LIEUTENANT (JG) USING THE FORMULA PRESCRIBED IN SECTION 516 OF THE CAREER COMPENSATION ACT.

SINCE YOU WERE EMPLOYED BY THE FEDERAL GOVERNMENT IN A CIVILIAN CAPACITY YOUR ADVANCEMENT TO THE COMMISSIONED GRADE OF LIEUTENANT (JG) ON THE RETIRED LIST SUBJECTED YOU TO THE DUAL COMPENSATION RESTRICTIONS OF SECTION 212 OF THE ECONOMY ACT, APPROVED JUNE 30, 1932, CH. 314, 47 STAT. 406, AS AMENDED, 5 U.S.C. 59A (1952 ED.). THEREFORE YOU REQUESTED RESTORATION TO YOUR FORMER ENLISTED STATUS AND YOU WERE SO RESTORED BY THE SECRETARY OF THE NAVY, EFFECTIVE AUGUST 17, 1954. PRESUMABLY, YOUR RESTORATION WAS EFFECTED UNDER AUTHORITY OF SECTION 511 OF THE CAREER COMPENSATION ACT OF 1949, WHICH AUTHORIZED A MEMBER SO RESTORED TO BE REGARDED "THEREAFTER" AS HOLDING THE GRADE TO WHICH RESTORED. SUCH STATUTORY PROVISION DID NOT AUTHORIZE RESTORATION TO BE RETROACTIVELY EFFECTIVE AS OF THE DATE OF RETIREMENT. ACCORDINGLY YOU WERE AGAIN PAID RETIRED PAY BASED ON YOUR ENLISTED GRADE FROM AUGUST 17, 1954.

ON MAY 21, 1965, THE UNDER SECRETARY OF THE NAVY APPROVED THE RECOMMENDATION OF THE BOARD FOR CORRECTION OF NAVAL RECORDS THAT YOUR RECORDS BE CORRECTED TO SHOW:

"A. THAT PETITIONER WAS NOT ADVANCED ON THE RETIRED LIST TO THE GRADE OF LIEUTENANT (JUNIOR GRADE), EFFECTIVE FROM THE DATE OF HIS RETIREMENT;

"B. THAT ON 1 AUGUST 1954 THE SECRETARY OF THE NAVY DETERMINED THAT THE HIGHEST GRADE AND RANK IN WHICH PETITIONER HAD SERVED SATISFACTORILY UNDER A TEMPORARY APPOINTMENT AND IN WHICH HE COULD RECEIVE THE HIGHEST RETIRED PAY WHICH HE COULD RECEIVE WITHOUT COMING WITHIN THE TERMS OF THE ECONOMY ACT OF 30 JUNE 1932, AS AMENDED, WAS THE WARRANT GRADE OF ELECTRICIAN;

"C. THAT PETITIONER WAS NOT RESTORED TO HIS PREVIOUS STATUS AS AN ENLISTED MAN ON THE RETIRED LIST ON 17 AUGUST 1954.

"D. THAT HE WAS ADVANCED ON THE RETIRED LIST TO THE WARRANT GRADE OF ELECTRICIAN FROM THE DATE OF HIS RETIREMENT, 1 AUGUST 1954.'

THE EFFECT OF A CORRECTION BOARD ACTION ON A MEMBER'S PAY MUST BE DETERMINED BY PROPER APPLICATION OF THE STATUTES TO THE FACTS AS SHOWN BY THE CORRECTED RECORD. 34 COMP. GEN. 7. YOUR RECORDS, BEFORE CORRECTION, SHOWED THAT YOU WERE ADVANCED ON THE RETIRED LIST TO THE GRADE OF LIEUTENANT (JG), EFFECTIVE AUGUST 1, 1954, AND THAT YOU WERE RESTORED TO YOUR ENLISTED GRADE EFFECTIVE AUGUST 17, 1954, ALTHOUGH YOU HAD ALSO SERVED IN THE TEMPORARY GRADE OF WARRANT OFFICER, W-1. THE CORRECTION BOARD CHANGED YOUR RECORDS TO SHOW THAT YOU WERE NOT ADVANCED TO THE GRADE OF LIEUTENANT (JG) AND RESTORED TO ENLISTED GRADE BUT THAT EFFECTIVE AUGUST 1, 1954, YOU WERE ADVANCED TO THE GRADE OF WARRANT OFFICER, W-1.

PRIOR TO THE CORRECTION OF YOUR RECORDS YOU WERE ENTITLED TO RETIRED PAY FOR THE PERIOD AUGUST 1 TO 16, 1954, BASED ONLY ON YOUR RETIRED GRADE OF LIEUTENANT (JG) AND IN VIEW OF YOUR CIVILIAN EMPLOYMENT BY THE FEDERAL GOVERNMENT SUCH RETIRED PAY WAS SUBJECT TO THE APPLICABLE DUAL COMPENSATION RESTRICTION. THE RECORD SHOWS THAT YOU RECEIVED NO RETIRED PAY FOR THAT PERIOD. THE CORRECTION OF YOUR RECORDS ESTABLISHED THAT YOU WERE NOT ENTITLED TO THE RETIRED PAY OF A LIEUTENANT (JG) FOR ANY PERIOD BUT THAT FROM AUGUST 1, 1954, YOU WERE ENTITLED TO THE RETIRED PAY OF A WARRANT OFFICER, W-1. THEREFORE A SETTLEMENT WILL BE ISSUED IN THE NEAR FUTURE ALLOWING YOU THE RETIRED PAY OF A WARRANT OFFICER, W-1, FOR THE PERIOD AUGUST 1 TO 16, 1954, AS WELL AS THE DIFFERENCE IN RETIRED PAY BETWEEN THAT WHICH YOU RECEIVED COMPUTED ON YOUR ENLISTED GRADE AND THAT TO WHICH YOU ARE ENTITLED AS A WARRANT OFFICER, W-1, FOR THE PERIOD AUGUST 17, 1954, TO JUNE 28, 1955, INCLUSIVE, BASED ON THE CORRECTION OF YOUR RECORDS. THE SETTLEMENT OF NOVEMBER 18, 1965, WAS NOT A SETTLEMENT OFFERED IN PAYMENT OF AN AMOUNT FOUND DUE BY REASON OF CORRECTION OF YOUR RECORDS AND THE NEGOTIATION OF THE CHECK COVERING THAT SETTLEMENT WILL NOT PREJUDICE YOUR RIGHT TO RECEIVE THIS PAYMENT.

IN ADDITION, THERE WILL BE ISSUED A SUPPLEMENTAL SETTLEMENT ALLOWING YOU THE PROPER ADJUSTMENT IN RETIRED PAY FOR THE PERIOD JUNE 29, 1955, TO AUGUST 31, 1965, COMPUTED ON 24 YEARS OF SERVICE FOR PERCENTAGE MULTIPLE PURPOSE--- LESS WITHHOLDING TAX, AND DEDUCTING THE DIFFERENCE IN ANNUITY COST UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, BETWEEN THAT CHARGED AND THE AMOUNT WHICH SHOULD HAVE BEEN CHARGED--- ON THE CORRECT RATE OF RETIRED PAY ENTITLEMENT AS OF THE DATE OF YOUR ELECTION, APRIL 1, 1954.