B-171767, MAR 8, 1971, 50 COMP GEN 607

B-171767: Mar 8, 1971

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PAY - RETIRED - ADVANCEMENT ON RETIRED LIST - PAY ADJUSTMENT MEMBERS OF THE UNIFORMED SERVICES ADVANCED IN GRADE ON THE RETIRED LIST WITHOUT REGARD TO WHETHER THEIR ACTIVE DUTY SERVICE IN A HIGHER GRADE WAS IN A TEMPORARY OR PERMANENT GRADE OR WHETHER THE SATISFACTORY SERVICE WAS IN THE SAME SERVICE FROM WHICH RETIRED MAY BE PAID ADJUSTMENTS IN RETIRED PAY FROM DATE OF RETIREMENT. EVEN THOUGH THE REQUIRED ADMINISTRATIVE APPROVAL OF SATISFACTORY SERVICE WAS MADE MORE THAN 10 YEARS SUBSEQUENT TO RETIREMENT. FOR UNDER THE RULE THAT A CLAIM WHICH BY STATUTE IS NOT PAYABLE UNTIL ITS VALIDITY IS DETERMINED BY A DESIGNATED AGENCY DOES NOT ACCRUE UNTIL THE DETERMINATION OF VALIDITY HAS BEEN MADE.

B-171767, MAR 8, 1971, 50 COMP GEN 607

PAY - RETIRED - ADVANCEMENT ON RETIRED LIST - PAY ADJUSTMENT MEMBERS OF THE UNIFORMED SERVICES ADVANCED IN GRADE ON THE RETIRED LIST WITHOUT REGARD TO WHETHER THEIR ACTIVE DUTY SERVICE IN A HIGHER GRADE WAS IN A TEMPORARY OR PERMANENT GRADE OR WHETHER THE SATISFACTORY SERVICE WAS IN THE SAME SERVICE FROM WHICH RETIRED MAY BE PAID ADJUSTMENTS IN RETIRED PAY FROM DATE OF RETIREMENT, EVEN THOUGH THE REQUIRED ADMINISTRATIVE APPROVAL OF SATISFACTORY SERVICE WAS MADE MORE THAN 10 YEARS SUBSEQUENT TO RETIREMENT, FOR UNDER THE RULE THAT A CLAIM WHICH BY STATUTE IS NOT PAYABLE UNTIL ITS VALIDITY IS DETERMINED BY A DESIGNATED AGENCY DOES NOT ACCRUE UNTIL THE DETERMINATION OF VALIDITY HAS BEEN MADE, THE MEMBERS' CLAIMS FOR ADJUSTMENT OF THEIR RETIRED PAY ARE NOT BARRED BY THE ACT OF OCTOBER 9, 1940, AS THE 10-YEAR STATUTE OF LIMITATION BEGAN TO RUN FROM THE DATE OF THE ADMINISTRATIVE DETERMINATION OF ENTITLEMENT TO THE HIGHER GRADE AND NOT THE DATE OF RETIREMENT. STATUTES OF LIMITATIONS - CLAIMS - DATE OF ACCRUAL - ADMINISTRATIVE DETERMINATIONS SINCE A CLAIM WHICH BY STATUTE IS NOT PAYABLE UNTIL ITS VALIDITY IS DETERMINED BY A DESIGNATED AGENCY DOES NOT ACCRUE UNTIL THE DETERMINATION OF VALIDITY HAS BEEN MADE, IT IS NOT BARRED UNTIL 10 YEARS AFTER THE ADMINISTRATIVE DETERMINATION IS MADE AND, THEREFORE, THE APPLICATION OF THE ACT OF OCTOBER 9, 1940, THE 10-YEAR STATUTE OF LIMITATION, DOES NOT TAKE EFFECT UNTIL SECRETARIAL APPROVAL OF THE ADVANCEMENT OF MEMBERS ON THE RETIRED LIST WITHOUT REGARD TO WHETHER THE SATISFACTORY ACTIVE DUTY SERVICE WAS IN A PERMANENT OR TEMPORARY GRADE, OR IN THE SERVICE FROM WHICH RETIRED. READJUSTMENT PAYMENTS THAT HAD BEEN DISALLOWED MAY BE PAID ADMINISTRATIVELY, AS WELL AS FUTURE CLAIMS, WHETHER THE RETIREMENT WAS FOR DISABILITY OR UNDER 10 U.S.C. 8964, AND NOTWITHSTANDING THE MEMBER'S HIGHER GRADE WAS IN THE SERVICE FROM WHICH RETIRED, AND THE ORDER EFFECTING A CHANGE TO THE HIGHER GRADE CONSTITUTES THE DATE OF ADMINISTRATIVE DETERMINATION OF SATISFACTORY SERVICE IN THE HIGHER GRADE WHEN ISSUED ON THE SAME DAY AS THE DETERMINATION.

TO LIEUTENANT COLONEL N. C. ALCOCK, DEPARTMENT OF THE AIR FORCE, MARCH 8, 1971:

YOUR LETTER OF DECEMBER 31, 1970, REQUESTS A DECISION CONCERNING THE APPLICATION OF THE ACT OF OCTOBER 9, 1940, CH. 788, 54 STAT. 1061, 31 U.S.C. 71A, 237, TO THE PAYMENT OF ADJUSTMENTS IN RETIRED PAY WHEN MEMBERS OF THE UNIFORMED SERVICES ARE ADVANCED IN GRADE ON THE RETIRED LIST. YOUR REQUEST FOR DECISION HAS BEEN ASSIGNED AIR FORCE REQUEST NO. DO-AF-1110 BY THE DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE.

IN DECISION OF MARCH 23, 1970, 49 COMP. GEN. 618, WE HELD THAT WHERE AN EXISTING STATUTE AUTHORIZES THE COMPUTATION OF THE RETIRED PAY OF A MEMBER OF AN ARMED SERVICE ON THE BASIS OF THE PAY OF A GRADE IN WHICH THE MEMBER HAD SERVED SATISFACTORILY (AS DETERMINED BY PROPER AUTHORITY) WHICH IS HIGHER THAN THE GRADE ON WHICH HE IS OTHERWISE ENTITLED TO COMPUTE HIS RETIRED PAY, PAYMENT OF RETIRED PAY COMPUTED ON THE PAY OF THAT HIGHER GRADE WILL BE PASSED TO CREDIT IN DISBURSING OFFICERS' ACCOUNTS WITHOUT REGARD TO WHETHER THAT GRADE WAS A TEMPORARY OR PERMANENT GRADE, SUBJECT TO THE ABOVE-CITED ACT OF OCTOBER 9, 1940. WE FURTHER STATED THAT SUCH ACTION IN ANY PARTICULAR CASE WILL DEPEND UPON AN APPROPRIATE ADMINISTRATIVE DETERMINATION AS TO SATISFACTORY SERVICE WHERE SUCH DETERMINATION IS REQUIRED BY THE APPLICABLE STATUTE.

OUR DECISION OF MARCH 23, 1970, FOLLOWED A SERIES OF DECISIONS BY THE UNITED STATES COURT OF CLAIMS, INCLUDING THE CASES OF FRIESTEDT V UNITED STATES, 173 CT. CL. 447 (1965), AND MILLER V UNITED STATES, 180 CT. CL. 872 (1967), WHEREIN THE COURT REACHED CONCLUSIONS WHICH WERE NOT IN AGREEMENT WITH VIEWS EXPRESSED IN EARLIER DECISIONS OF THIS OFFICE WITH RESPECT TO THE INTERPRETATION OF STATUTES CONCERNING THE HIGHEST TEMPORARY AND PERMANENT GRADE IN WHICH RETIRED MEMBERS HAD SERVED SATISFACTORILY ON ACTIVE DUTY AND THE "SAME SERVICE" RULE ENUNCIATED BY THIS OFFICE IN A NUMBER OF DECISIONS BEGINNING WITH OUR DECISION OF MAY 3, 1950, 29 COMP. GEN. 437.

THE ABOVE-CITED DECISIONS OF THIS OFFICE PRECLUDED THE ADMINISTRATIVE PAYMENT OF RETIRED PAY BASED UPON CERTAIN HIGHER PERMANENT GRADES HELD IN THE SAME SERVICE AND HIGHER GRADES HELD IN AN ARMED SERVICE DIFFERENT THAN THAT FROM WHICH RETIRED. PRESUMABLY, BECAUSE OF SUCH DECISIONS THE ARMED SERVICES DID NOT ADVANCE RETIRED MEMBERS ON THE RETIRED LIST TO A HIGHER GRADE, WHICH THE COURT OF CLAIMS HELD TO BE AUTHORIZED, UNTIL OUR DECISION OF JULY 8, 1966, 46 COMP. GEN. 17, WITH RESPECT TO CERTAIN DISABILITY RETIREMENTS AND OUR DECISION OF MARCH 23, 1970, 49 COMP. GEN. 618, WITH RESPECT TO RETIREMENTS GENERALLY WHERE ADVANCEMENT IN GRADE UPON RETIREMENT WAS AUTHORIZED BY STATUTE.

YOUR LETTER REFERS TO TWO CASES WHERE MEMBERS THERETOFORE RETIRED FOR DISABILITY WERE ADVANCED ON THE RETIRED LIST IN 1968 AND 1969 TO A HIGHER PERMANENT GRADE IN WHICH THE COGNIZANT SECRETARY DETERMINED THE MEMBER HAD SERVED SATISFACTORILY. IN ONE CASE MEMBER A WAS RETIRED FOR DISABILITY IN 1944 IN THE GRADE OF PRIVATE (E-1) AND WAS PAID RETIRED PAY AS A PRIVATE FIRST CLASS (E-2) PURSUANT TO THE ACT OF MAY 7, 1932, CH. 171, 47 STAT. 150, AND SECTION 203(E) OF THE ACT OF JUNE 29, 1948, CH. 708, 62 STAT. 1086, EFFECTIVE JUNE 29, 1948. HE WAS ADVANCED ON THE RETIRED LIST TO THE GRADE OF TECHNICAL SERGEANT (E-6) RETROACTIVE TO RETIREMENT DATE ON AUGUST 30, 1968, AS AUTHORIZED BY OUR DECISION OF JULY 8, 1966, 46 COMP. GEN. 17.

MEMBER A'S CLAIM FOR THE DIFFERENCE BETWEEN THE RETIRED PAY OF GRADES E-6 AND E-2 WAS ALLOWED IN THE AMOUNT OF $8,538.36 FOR THE PERIOD OCTOBER 30, 1958, THROUGH SEPTEMBER 30, 1968, BY SETTLEMENT OF OUR CLAIMS DIVISION DATED AUGUST 12, 1969. THAT SETTLEMENT DISALLOWED THAT PART OF HIS CLAIM WHICH COVERED THE PERIOD JUNE 29, 1948, THROUGH OCTOBER 29, 1958, FOR THE STATED REASON THAT IT WAS BARRED BY THE ACT OF OCTOBER 9, 1940, BECAUSE IT RELATED TO A PERIOD WHICH WAS MORE THAN 10 YEARS PRIOR TO THE DATE OF RECEIPT OF SUCH CLAIM IN OUR OFFICE ON OCTOBER 30, 1968.

MEMBER B WAS RETIRED FOR DISABILITY ON AUGUST 29, 1958, IN THE GRADE OF AIRMAN FIRST CLASS (E-4). ON AUGUST 22, 1969, HE WAS ADVANCED ON THE RETIRED LIST TO MASTER SERGEANT (E-7) RETROACTIVE TO RETIREMENT DATE. HIS CLAIM FOR THE DIFFERENCE BETWEEN THE RETIRED PAY OF GRADES E 7 AND E-4 WAS ALLOWED BY OUR CLAIMS DIVISION IN THE AMOUNT OF $4,592.05 FOR THE PERIOD SEPTEMBER 25, 1959, THROUGH SEPTEMBER 30, 1969. HIS CLAIM FOR THE PERIOD AUGUST 30, 1958 THROUGH SEPTEMBER 24, 1959, WAS DISALLOWED BY OUR CLAIMS DIVISION FOR THE STATED REASON THAT HIS CLAIM FOR THE PERIOD PRIOR TO SEPTEMBER 25, 1959, WAS BARRED BY THE ACT OF OCTOBER 9, 1940.

YOU REQUEST DECISION WHETHER THE ABOVE CLAIMS FOR THE PERIODS MORE THAN 10 YEARS PRIOR TO THEIR RECEIPT IN THE GENERAL ACCOUNTING OFFICE ARE BARRED BY THE 1940 ACT.

IN DECISION OF MAY 16, 1955, 34 COMP. GEN. 605, WE HELD THAT A CLAIM WHICH BY STATUTE IS NOT PAYABLE UNTIL ITS VALIDITY IS DETERMINED BY A DESIGNATED AGENCY DOES NOT ACCRUE UNTIL THE DETERMINATION OF VALIDITY HAS BEEN MADE AND, HENCE, THAT SUCH A CLAIM IS NOT BARRED BY THE ACT OF OCTOBER 9, 1940, UNTIL 10 YEARS AFTER SUCH ADMINISTRATIVE DETERMINATION IS MADE.

IN DECISION OF MARCH 3, 1959, B-138417, WE HELD THAT, SINCE THE SECRETARY OF THE NAVY DID NOT ADVANCE THE RETIRED ENLISTED MEMBER OF THE NAVY THERE INVOLVED TO CHIEF BOATSWAIN, THE HIGHEST TEMPORARY GRADE SATISFACTORILY HELD BY HIM, UNTIL FEBRUARY 7, 1949, HIS "RIGHT TO RETIRED PAY ON THE BASIS OF THAT HIGHER GRADE COULD NOT LEGALLY HAVE ACCRUED UNTIL FEBRUARY 7, 1949," AND THAT THEREFORE HIS CLAIM FOR ADJUSTMENT IN HIS RETIRED PAY FOR THE PERIOD BEGINNING MARCH 1, 1946, BASED ON SUCH ADVANCEMENT, WHICH WAS FIRST RECEIVED IN THIS OFFICE ON FEBRUARY 13, 1958, WAS NOT BARRED BY THE ACT OF OCTOBER 9, 1940.

IN DECISION OF SEPTEMBER 29, 1970, B-170331, WE SAID THAT SINCE AN ENLISTED MEMBER OF THE COAST GUARD RETIRED IN GRADE E-6 WAS NOT ENTITLED TO COMPUTE HIS RETIRED PAY ON THE GRADE OF E-7 "UNLESS AND UNTIL A PROPER ADMINISTRATIVE DETERMINATION OF SATISFACTORY SERVICE IN THE HIGHER GRADE IS MADE, HIS RIGHT TO RETROACTIVE ADJUSTMENT WILL ACCRUE AS OF THE DATE OF SUCH DETERMINATION AND THE ACT OF OCTOBER 9, 1940, WILL NOT BE APPLICABLE."

YOU SUGGEST THAT THE ACTION OF OUR CLAIMS DIVISION IN DISALLOWING THAT PART OF THE ABOVE-CITED CLAIMS FOR THE PERIOD MORE THAN 10 YEARS BEFORE RECEIPT THEREOF IN THE GENERAL ACCOUNTING OFFICE IS INCONSISTENT WITH THE ABOVE-CITED DECISIONS AND VOUCHERS COVERING THE DISALLOWED PORTIONS THEREOF ARE SUBMITTED FOR RECONSIDERATION AS TO PROPRIETY OF PAYMENT.

THE ABOVE-CITED DECISIONS ARE FOR APPLICATION WITH RESPECT TO THE CASES OF THE RETIRED ENLISTED MEN HERE INVOLVED. SINCE THEIR RIGHT TO RETIRED PAY BASED ON THE HIGHER GRADE WAS DEPENDENT UPON THEIR ADVANCEMENT ON THE RETIRED LIST ON AUGUST 30, 1968, AND ON AUGUST 22, 1969, RESPECTIVELY, THEIR CLAIMS WERE TIMELY FILED. ACCORDINGLY, PAYMENT OF THE SUBMITTED VOUCHERS IS AUTHORIZED AND THEY ARE RETURNED HEREWITH FOR PAYMENT, IF OTHERWISE CORRECT.

YOU SAY THAT THERE ARE NUMEROUS OTHER SIMILAR CLAIMS NOW PENDING AT VARIOUS STAGES AND ASK THAT THE FOLLOWING ADDITIONAL RELATED QUESTIONS BE ANSWERED IN ORDER TO ESTABLISH GUIDELINES FOR HANDLING THESE AND OTHER TYPES OF CASES:

A. WILL IT BE NECESSARY, ON THOSE CASES WHERE THE CLAIMS DIVISION HAS DISALLOWED THAT PORTION ACCRUING PRIOR TO TEN YEARS FROM RECEIPT DATE IN GAO, TO RESUBMIT VOUCHERS FOR SUCH DISALLOWED AMOUNTS TO YOUR CLAIMS DIVISION FOR APPROVAL, PRIOR TO ANY SUPPLEMENTAL SETTLEMENT BY THIS OFFICE?

B. MAY FUTURE CASES, WHICH HAVE NOT YET BEEN SUBMITTED TO THE CLAIMS DIVISION, BE SETTLED HERE WITHOUT APPROVAL BY YOUR CLAIMS DIVISION?

C. DOES THE DATE OF THE SECRETARIAL ORDER EFFECTING CHANGE TO A HIGHER GRADE ON THE RETIRED LIST CONSTITUTE THE DATE OF AN ADMINISTRATIVE DETERMINATION OF SATISFACTORY SERVICE IN THE HIGHER GRADE WITHIN THE MEANING OF THAT TERM AS USED IN B-170331, 29 SEPTEMBER 1970, INSOFAR AS THE ACT OF 9 OCTOBER 1940 IS INVOLVED?

D. WOULD YOUR ANSWER IN THE TWO ATTACHED CASES (OR TO ANY OF THE PRECEDING QUESTIONS) BE DIFFERENT IF THE INDIVIDUALS INVOLVED WERE RETIRED FOR REASONS OTHER THAN PHYSICAL DISABILITY AND ADVANCED ON THE RETIRED LIST UNDER 10 U.S.C. 8964 AFTER 30 YEARS ACTIVE AND RETIRED SERVICE?

E. WOULD YOUR ANSWER LIKEWISE BE DIFFERENT IF THE MEMBER HELD SUCH HIGHER GRADE IN THE SERVICE FROM WHICH HE RETIRED (OR IN ITS PREDECESSOR FOR THOSE RETIRED FROM THE AIR FORCE) AS OPPOSED TO A HIGHER GRADE HELD IN ANOTHER BRANCH OF SERVICE?

ON THE BASIS OF THE FOREGOING DISCUSSION, QUESTIONS "B" AND "C" ARE ANSWERED IN THE AFFIRMATIVE AND QUESTIONS "A," "D" AND "E" ARE ANSWERED IN THE NEGATIVE. THE AFFIRMATIVE ANSWER TO QUESTION "C" IS BASED ON THE ASSUMPTION THAT THE SECRETARIAL ORDER EFFECTING A CHANGE TO A HIGHER GRADE IS ISSUED ON THE SAME DAY AN ADMINISTRATIVE DETERMINATION OF SATISFACTORY SERVICE IN THE HIGHER GRADE IS MADE. SEE B-170331, SEPTEMBER 29, 1970.