B-218714, O/M, AUG 23, 1985

B-218714: Aug 23, 1985

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RETURNED IS YOUR FILE Z-2851691 INVOLVING ARREARS OF RETIRED PAY DUE THE SURVIVORS OF JOHN MAIAROTA A DECEASED RETIRED MEMBER OF THE AIR FORCE. THE ISSUE IS WHETHER THE STATUTE OF LIMITATIONS BARE CONSIDERATION OF THIS CLAIM BY SURVIVORS OF A DECEASED RETIRED MEMBER OF THE AIR FORCE. THAT COMPENSATION WAS SUSPENDED FROM 1959 TO 1979. BECAUSE HE WAS BEING FURNISHED CARE IN VETERANS ADMINISTRATION FACILITIES CAUSING THE WAIVER OF RETIRED PAY TO BE SUSPENDED. WE CONCLUDE THAT THE CLAIM IS NOT BARRED. JOHN MAIAROTA WAS FOUND MENTALLY INCOMPETENT AND WAS RETIRED FROM THE AIR FORCE ON AUGUST 31. SEC. 3702(B)(1) PRECLUDES CONSIDERATION OF A CLAIM UNLESS IT IS RECEIVED IN THE GENERAL ACCOUNTING OFFICE WITHIN 6 YEARS OF ACCRUAL.

B-218714, O/M, AUG 23, 1985

PRECIS-UNAVAILABLE

CLAIM FOR ACCRUED RETIRED PAY - JOHN MAIAROTA, DECEASED (2-2851691)- B-218714-O.M.

RETURNED IS YOUR FILE Z-2851691 INVOLVING ARREARS OF RETIRED PAY DUE THE SURVIVORS OF JOHN MAIAROTA A DECEASED RETIRED MEMBER OF THE AIR FORCE.

THE ISSUE IS WHETHER THE STATUTE OF LIMITATIONS BARE CONSIDERATION OF THIS CLAIM BY SURVIVORS OF A DECEASED RETIRED MEMBER OF THE AIR FORCE. THEY CLAIM HIS MILITARY RETIRED PAY WHICH HE WAIVE IN 1955 IN ORDER TO RECEIVE VETERANS ADMINISTRATION COMPENSATION. HOWEVER, THAT COMPENSATION WAS SUSPENDED FROM 1959 TO 1979, BECAUSE HE WAS BEING FURNISHED CARE IN VETERANS ADMINISTRATION FACILITIES CAUSING THE WAIVER OF RETIRED PAY TO BE SUSPENDED. WE CONCLUDE THAT THE CLAIM IS NOT BARRED, AND WITH CERTAIN LIMITATIONS MAY BE PAID.

JOHN MAIAROTA WAS FOUND MENTALLY INCOMPETENT AND WAS RETIRED FROM THE AIR FORCE ON AUGUST 31, 1955. IMMEDIATELY AFTER HIS ADMISSION TO A VETERANS ADMINISTRATION HOSPITAL, HE WAIVED HIS RETIRED PAY IN ITS ENTIRETY IN ORDER TO RECEIVE VETERANS ADMINISTRATION COMPENSATION. HOWEVER, THE VETERANS ADMINISTRATION WITHHELD HIS BENEFITS FROM JANUARY 1, 1959, THROUGH APRIL 30, 1979, UNDER 38 U.S.C. SEC. 3203(B)(1) BECAUSE HIS TOTAL ASSETS EXCEEDED THE $1,500 LIMIT ALLOWED BY THAT PROVISION. (THIS PROVISION HAS BEEN CONTAINED IN VARIOUS SUBSECTIONS OF 38 U.S.C. SEC. 3203 OVER THE PERIOD OF THE CLAIM.) MR. MAIAROTA REMAINED HOSPITALIZED UNTIL HIS DEATH ON MAY 12, 1979.

MRS. GENEVIEVE M. DOUGLAS, SISTER AND ADMINISTRATOR OF JOHN MAIAROTA'S ESTATE, FILED A CLAIM IN THIS OFFICE FOR THE RETIRED PAY DUE FROM JANUARY 1, 1959, THROUGH APRIL 30, 1979. THE CLAIMS GROUP CONCLUDED THAT ONLY A PORTION OF THE CLAIM COULD BE PAID AND BARRED PAYMENT FOR THE PERIOD PRIOR TO OCTOBER 1, 1977, BECAUSE 31 U.S.C. SEC. 3702(B)(1) PRECLUDES CONSIDERATION OF A CLAIM UNLESS IT IS RECEIVED IN THE GENERAL ACCOUNTING OFFICE WITHIN 6 YEARS OF ACCRUAL. IT WAS DETERMINED THAT UNDER 10 U.S.C. SEC. 2771, MRS. MARY MAIAROTA, MOTHER OF THE DECEASED RETIREE, WAS ENTITLED TO THE PAY, WHICH WAS NOT SUBJECT TO THE BARRING ACT. APPARENTLY, PAYMENT SHOULD HAVE BEEN AUTHORIZED FOR AUGUST 1, 1977, THROUGH APRIL 30, 1979, SINCE AUGUST 1, 1983, WAS THE DATE OF RECEIPT OF THE CLAIM IN THIS OFFICE. THE CLAIMANT CONTENDS THAT THE ENTIRE CLAIM SHOULD BE PAID BECAUSE SHE WAS UNAWARE OF THE STATUE OF LIMITATION, AND HER INQUIRY TO THE AIR FORCE IN 1980 LED HER TO BELIEVE NO RETIRED PAY WAS DUE.

UNDER 38 U.S.C. SEC. 3105, A VETERAN WHO IS ENTITLED TO RETIRED PAY MAY BE PAID DISABILITY COMPENSATION BY THE VETERANS ADMINISTRATION ONLY IF HE WAIVE AN EQUAL AMOUNT OF HIS RETIRED PAY. PAYMENT OF VETERANS ADMINISTRATION COMPENSATION, INCOMPETENT VETERANS WHO HAVE NEITHER SPOUSE, CHILD, NOR DEPENDENT PARENTS IS GOVERNED BY 38 U.S.C. SEC. 3203. IF THE VETERAN'S ESTATE EXCEED $1,500, 38 U.S.C. SEC. 3203(B)(1) REQUIRES COMPENSATION PAYMENTS TO BE WITHHELD UNTIL THE ESTATE IS REDUCED TO $500. HOWEVER, UNDER THE SAME PROVISION, THE WITHHELD COMPENSATION IS PAYABLE, TO THE VETERAN IN A LUMP SUM 6 MONTHS AFTER HE IS FOUND COMPETENT, BUT IF THE VETERAN DIES AN INCOMPETENT, PAYMENT OF THE LUMP SUM IS PROHIBITED. WE HAVE HELD THAT WHEN PAYMENT OF VETERANS ADMINISTRATION COMPENSATION TO A MENTALLY INCOMPETENT VETERAN IS TERMINATED HIS WAIVER OF RETIRED PAY BECOMES INEFFECTIVE PROVIDED THE TERMINATION IS COMPLETE AND UNCONDITIONAL. IN CASES WHERE THE WITHHOLDING OF COMPENSATION IS ONLY TEMPORARY PENDING THE VETERAN'S RECOVERY, THE WAIVER DOES NOT BECOME INEFFECTIVE UNTIL THE MEMBER DIES BECAUSE ONLY UPON THE DEATH OF THE INCOMPETENT MEMBER DOES THE RIGHT TO RECEIVE THE WITHHELD COMPENSATION TERMINATE. AT SUCH TIME THE ACCRUED RETIRED PAY BECOMES PAYABLE. COMP.GEN. 315 (1969) AND 3 COMP.GEN. 39 (1963). THOSE PERSONS LISTED IN 10 U.S.C. SEC. 2771 WOULD BE ENTITLED TO RETIRED PAY ACCRUING FROM THE DATE THE COMPENSATION PAYMENTS WERE FIRST WITHHELD. 43 COMP.GEN. AT 41.

CONSIDERATION OF ANY CLAIM NOT RECEIVE IN THE GENERAL ACCOUNTING OFFICE WITHIN 6 YEARS OF THE DATE IT ACCRUES IS PRECLUDED BY 31 U.S.C. SEC. 3702(B)(1). HOWEVER, IF A RIGHT OF ACTION DEPENDS ON THE OCCURRANCE OF AN EVENT OR A CONTINGENCY, THE RIGHT DOES NOT ACCRUE AND THE STATUTE OF LIMITATION DOES NOT BEGIN TO RUN UNTIL THE EVENT OR CONTINGENCY OCCURS. 26 COMP.GEN. 734, 738 (1941). MR. MAIAROTA'S DEATH WHILE HE WAS STILL INCOMPETENT WAS THE EVENT NECESSARY TO COMPLETELY TERMINATE ANY RIGHT TO PAYMENT OF THE VETERANS ADMINISTRATION COMPENSATION, THUS MAKING HIS WAIVER OF RETIRED PAY INEFFECTIVE. THIS POINT WAS THE FIRST TIME A CLAIM FOR RETIRED PAY COULD BE CONSIDERED.

ACCORDINGLY, 31 U.S.C. SEC. 3702(B)(1) DOES NOT BAR THE CLAIM BECAUSE THE RIGHT TO RETROACTIVE REINSTATEMENT OF RETIRED PAY DID NOT ACCRUE UNTIL MR. MAIAROTA'S DEATH. THE 6-YEAR PERIOD FOR FILING A CLAIM BEGAN TO RUN ON MAY 12, 1979, AND THE CLAIM WAS RECEIVED IN THE GENERAL ACCOUNTING OFFICE ON AUGUST 1, 1983, WITHIN THE 6-YEAR STATUTORY PERIOD.

UNDER 38 U.S.C. SEC. 3203(B)(1) (1964 ED.) AN INCOMPETENT VETERAN WITH NEITHER WIFE, CHILD NOR DEPENDENT PARENT, WHO WAS FURNISHED HOSPITAL TREATMENT, INSTITUTIONAL OR DOMICILIARY CARE IN EXCESS OF 6 MONTHS WAS SUBJECT TO A 50 PERCENT WITHHOLDING OF HIS COMPENSATION OR RETIREMENT PAY. A LUMP-SUM PAYMENT OF THE AMOUNT SO WITHHELD COULD BE MADE TO THE VETERAN 6 MONTHS FOLLOWING A DETERMINATION THAT HE WAS COMPETENT. HOWEVER, IF HE DIED PRIOR TO PAYMENT OF THE LUMP SUM, NO PART THEREOF WAS TO BE PAID. THIS PROVISION REMAINED IN EFFECT UNTIL JULY 31, 1972, THE EFFECTIVE DATE OF THE AMENDMENT MADE BY PUBLIC LAW 92-328, JUNE 30, 1977, 86 STAT. 394. SECTION 106 OF PUBLIC LAW 92-328, PROVIDED THAT AMOUNTS WITHHELD UNDER FORMER SECTION 3203(A) AND (B)(1) OF TITLE 38 SHOULD BE PAID IN LUMP-SUM TO COMPETENT VETERANS: LUMP-SUM PAYMENTS OR SUCCESSIVE LUMP-SUM PAYMENTS COULD BE MADE TO INCOMPETENT VETERANS SUBJECT TO THE $1,500 AND $500 LIMITATION OF 38 U.S.C. SEC. 3203, AS AMENDED. IF AN INCOMPETENT VETERAN DIED BEFORE THE PAYMENT OF ALL WITHHELD AMOUNTS NO PART OF THE REMAINDER COULD BE PAID.

SINCE THE VETERANS ADMINISTRATION INDICATES THAT COMPENSATION HAD BEEN WITHHELD FROM JANUARY 1, 1959, THROUGH APRIL 30, 1979, SETTLEMENT MAY ISSUE FOR ONE-HALF THE RETIRED PAY ACCRUING FORM JANUARY 1, 1959, THROUGH JULY 31, 1972, AND FOR THE FULL AMOUNT OF RETIREMENT PAY FROM AUGUST 1, 1972, UNTIL OCTOBER 1, 1977. SETTLEMENT SHOULD BE IN ACCORDANCE WITH THE ORDER OF PRECEDENT IN 10 U.S.C. SEC. 2771. THEREFORE, HIS MOTHER, MARY MAIAROTA, IS ENTITLED TO THE AMOUNTS FOUND DUE.