B-165726, FEBRUARY 4, 1969, 48 COMP. GEN. 515

B-165726, FEBRUARY 4, 1969, 48 COMP. GEN. 515

PAY - RETIRED - FLEET RESERVISTS - RETAINER PAY WITHHOLDINGS - DISABILITY COMPENSATION AS CIVILIAN LIMITING THE APPLICATION OF THE RULE IN MULHOLLAND V UNITED STATES, 139 CT. CL. 507 (1957), THAT A MEMBER OF THE FLEET RESERVE MAY RECEIVE RETAINER PAY CONCURRENTLY WITH CIVILIAN DISABILITY COMPENSATION TO PERIODS PRIOR TO 1952, WILL NO LONGER BE REQUIRED IN VIEW OF THE HOLDING IN MERLYN E. HORN V UNITED STATES, 185 CT. CL. 795, IN WHICH THE COURT RECOGNIZED THE PLAINTIFF'S CLAIM FOR RETAINER PAY WITHHELD AFTER 1952 FOR THE PERIOD DURING WHICH HE RECEIVED DISABILITY COMPENSATION FOR AN INJURY SUSTAINED IN HIS CIVILIAN POSITION. THEREFORE, THE RETAINER PAY WITHHELD FROM A MEMBER INJURED IN 1966 AND AWARDED 288 WEEKS OF CIVILIAN DISABILITY COMPENSATION MAY BE RELEASED TO HIM AND FUTURE MONTHLY PAYMENTS OF RETAINER PAY DUE IN HIS AND OTHER SIMILAR CASES MAY BE PAID CONCURRENTLY WITH CIVILIAN DISABILITY COMPENSATION. 38 COMP. GEN. 243, MODIFIED.

TO THE SECRETARY OF THE NAVY, FEBRUARY 4, 1969:

REFERENCE IS MADE TO THE CLAIM OF CHARLIE BATES, 236 50 46, SDI, USNFR, FOR RETAINER PAY WITHHELD WHILE IN RECEIPT OF FEDERAL EMPLOYEES' COMPENSATION, PURSUANT TO 5 U.S.C. 8116 (A). BY LETTER DATED DECEMBER 14, 1967, FROM THE NAVY FINANCE CENTER, CLEVELAND, OHIO, THE CLAIM WAS REFERRED TO THE CLAIMS DIVISION OF THIS OFFICE FOR CONSIDERATION.

THE RECORD INDICATES THAT MR. BATES WAS TRANSFERRED TO THE FLEET RESERVE AFTER MORE THAN 20 YEARS OF SERVICE IN THE U.S. NAVY AND THAT HE BECAME ENTITLED TO RETAINER PAY AT THE RATE OF $164.83 PER MONTH. WHILE EMPLOYED AT THE NORFOLK NAVAL SHIPYARD, PORTSMOUTH, VIRGINIA, HE WAS INJURED IN AN ACCIDENT ON APRIL 14, 1966. ON JUNE 27, 1967, THE BUREAU OF EMPLOYEES' COMPENSATION AWARDED HIM COMPENSATION FOR 288 WEEKS AT THE RATE OF 3/4 OF $86.40 PER WEEK FOR THE PERIOD FROM JUNE 1, 1967, TO DECEMBER 6, 1972, INCLUSIVE. EFFECTIVE JULY 1, 1967, HIS RETAINER PAY ACCOUNT WAS PLACED IN A SUSPENDED STATUS AND THE CHECK FOR JUNE 1967 WAS CANCELED.

BY SETTLEMENT DATED FEBRUARY 12, 1968, OUR CLAIMS DIVISION DISALLOWED MR. BATES' CLAIM FOR RETAINER PAY ON THE BASIS THAT THE PROVISIONS CONTAINED IN SECTION 7 (A) OF THE FEDERAL EMPLOYEES' COMPENSATION ACT OF 1916, AS AMENDED, 5 U.S.C. 757 (A) (1964 ED.), NOW 5 U.S.C. 8116 (A), BARRED THE PAYMENT OF NAVAL RETAINER OR RETIRED PAY CONCURRENTLY WITH CIVILIAN DISABILITY COMPENSATION PAYMENTS. THAT ACTION WAS IN LINE WITH THE LONG STANDING RULE OF THE ACCOUNTING OFFICERS OF THE GOVERNMENT IN SUCH CASES. SEE 18 COMP. GEN. 747; 38 ID. 243; 40 ID. 660. IN LETTER DATED NOVEMBER 5, 1968, MR. BATES REQUESTED REVIEW OF THAT SETTLEMENT.

IN THE CASE OF MULHOLLAND V UNITED STATES, 139 CT. CL. 507 (1957), THE COURT OF CLAIMS HELD THAT A MEMBER OF THE FLEET RESERVE MAY RECEIVE RETAINER PAY CONCURRENTLY WITH DISABILITY COMPENSATION AS A CIVILIAN EMPLOYEE BECAUSE (1) SECTION 4 OF THE NAVAL RESERVE ACT OF 1938, CH. 690, 52 STAT. 1176, MADE THE PROVISIONS CONTAINED IN SECTION 7 (A) OF THE FEDERAL EMPLOYEES' COMPENSATION ACT INAPPLICABLE TO MEMBERS OF THE NAVAL RESERVE (WHICH THEN INCLUDED THE FLEET RESERVE) AND BECAUSE (2) FLEET RESERVE RETAINER PAY IS PAID IN PART FOR PAST SERVICES AND IN PART FOR READINESS TO RENDER SERVICE WHEN CALLED UPON AND TO THAT EXTENT IT IS PAID "IN RETURN FOR SERVICES ACTUALLY PERFORMED" WITHIN THE MEANING OF THE FEDERAL EMPLOYEES' COMPENSATION ACT.

IN OUR DECISION OF SEPTEMBER 25, 1958, 38 COMP. GEN. 243, WE SAID THAT THE CONCURRENT PAYMENT OF RETAINER PAY AND CIVILIAN DISABILITY COMPENSATION FOR PERIODS BEFORE 1953 IS AUTHORIZED UNDER THE HOLDING IN THE MULHOLLAND CASE. HOWEVER, SECTION 4 OF THE 1938 LAW WAS REPEALED BY SECTION 803 OF THE ARMED FORCES RESERVE ACT OF 1952, CH. 608, 66 STAT. 505, EFFECTIVE ON JANUARY 1, 1953, AND THEREAFTER THE FLEET RESERVE CEASED TO BE A PART OF THE UNITED STATES NAVAL RESERVE AND IT HAS SINCE BEEN CONSIDERED A COMPLETE ENTITY AND A COMPONENT OF THE REGULAR NAVY. AS WE DID NOT KNOW HOW MUCH WEIGHT THE COURT GAVE TO EACH OF THE TWO GROUNDS ON WHICH ITS OPINION WAS BASED, WE DID NOT AUTHORIZE PAYMENT OF RETAINER PAY CONCURRENTLY WITH DISABILITY COMPENSATION AFTER 1952.

IN THE CASE OF TAWES V UNITED STATES, 146 CT. CL. 500 (1959), THE COURT OF CLAIMS HELD THAT FEDERAL EMPLOYEES' DISABILITY COMPENSATION UNDER THE FEDERAL EMPLOYEES' COMPENSATION ACT IS "PAY INCIDENT TO" CIVILIAN EMPLOYMENT AND AS SUCH IS WITHIN THE DUAL COMPENSATION EXEMPTION PROVIDED IN SECTION 1 (B) OF THE ACT OF JULY 1, 1947, CH. 192, 61 STAT. 239, AS AMENDED, 10 U.S.C. 371 (B) (1952 ED.), CURRENTLY CODIFIED IN 5 U.S.C. 5534. CF. STEELMAN V UNITED STATES, 162 CT. CL. 81 (1963).

THE CASE OF MERLYN E. HORN V UNITED STATES, 185 CT. CL. 795 (1968), INVOLVED THE CLAIM OF A MEMBER OF THE FLEET RESERVE FOR RETAINER PAY WITHHELD DURING THE PERIOD FOR WHICH HE RECEIVED DISABILITY COMPENSATION UNDER CIRCUMSTANCES SIMILAR TO THOSE IN THE CASE OF MR. BATES. UPON CONSIDERATION OF HORN'S MOTION AND THE GOVERNMENT'S CROSS MOTION FOR SUMMARY JUDGMENT, ORAL ARGUMENT OF COUNSEL AND THE BRIEFS OF THE PARTIES AND ON THE BASIS OF THE DECISIONS IN THE MULHOLLAND AND TAWES CASES, THE COURT GRANTED HORN'S MOTION FOR SUMMARY JUDGMENT. WHILE WE DO NOT AGREE WITH THE ACTION TAKEN BY THE COURT AND WHILE THE GROUNDS ON WHICH IT DECIDED IN FAVOR OF THE PLAINTIFF ARE NOT CLEAR, THE JUDGMENT HAS NOW BECOME FINAL AND IT SEEMS MOST UNLIKELY THAT ANY FUTURE SIMILAR CASES COMING BEFORE THE COURT WOULD NOT BE DECIDED IN THE SAME WAY.

IN VIEW OF THE FOREGOING, WE WILL NOT OBJECT TO APPLICATION OF THE RULE IN THE MULHOLLAND CASE AS TO PERIODS AFTER 1952. ACCORDINGLY, THE RETAINER PAY WITHHELD FROM MR. BATES MAY BE RELEASED TO HIM AND FUTURE MONTHLY PAYMENTS OF RETAINER PAY DUE IN HIS AND OTHER SIMILAR CASES MAY BE PAID CONCURRENTLY WITH CIVILIAN DISABILITY COMPENSATION. 38 COMP. GEN. 243 IS MODIFIED ACCORDINGLY.