B-242021, Apr 15, 1991

B-242021: Apr 15, 1991

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Waiver may be granted to a member of the Navy whose pay account was in a temporary. Was repeatedly assured that he was not being overpaid. That the negative balances were for the purpose of balancing his account. LCDR Schock was recalled to active duty on July 31. In May 1989 the Navy advised him that he was indebted to the United States due to erroneous payments of pay and allowances totaling $4. 520 lump sum overpayment concluding that the member could reasonably have believed the amount represented unpaid flight pay. They concluded that although he questioned each of these overpayments and was assured they were correct. He should have pursued the matter further. Precludes waiver where there is an indication of fault or lack of good faith on the part of the individual requesting the waiver.

B-242021, Apr 15, 1991

MILITARY PERSONNEL - Pay - Overpayments - Error detection - Debt collection - Waiver DIGEST: A member of the armed services may be granted waiver of the collection of erroneous overpayments of pay and allowances when he receives them in good faith. Thus, waiver may be granted to a member of the Navy whose pay account was in a temporary, unbalanced status for almost 2 years, who, when he questioned the overpaid status of his LES's, was repeatedly assured that he was not being overpaid, but that the negative balances were for the purpose of balancing his account.

Lieutenant Commander Frederick F. Schock, USN - Waiver of Erroneous Payments:

Lieutenant Commander (LCDR) Frederick F. Schock appeals our Claims Group's partial denial of his request for waiver of the United States Navy's claim against him for erroneous payments he received while serving in the Navy. We conclude that waiver should be granted for the erroneous payments made to him.

LCDR Schock was recalled to active duty on July 31, 1987. In May 1989 the Navy advised him that he was indebted to the United States due to erroneous payments of pay and allowances totaling $4,800.96 because of overpayments of $665.88 during the period from July 1987 through September 1988; a lump sum overpayment for a differential in flight pay received on October 11, 1988; and overpayments of $1,631 for the period November 1, 1988 through May 31, 1989.

Our Claims Group, following the Navy's recommendation, waived collection of the first overpayment on the basis that the member had not received any Leave and Earnings Statements (LES) for this period. It also waived the $2,520 lump sum overpayment concluding that the member could reasonably have believed the amount represented unpaid flight pay, as the Navy itself initially believed when it made the payment. However, the Claims Group denied the request for waiver of the remaining $1,631 in indebtedness, since the member received LES during this period which showed him to be in an overpaid status, symbolized by minus signs in the column totals on the LES. They concluded that although he questioned each of these overpayments and was assured they were correct, he should have pursued the matter further.

The Comptroller General may waive collection of erroneous payments of pay and allowances under 10 U.S.C. Sec. 2774 if collection would be against equity and good conscience and not in the best interests of the United States. Subsection 2774(b)(1), however, precludes waiver where there is an indication of fault or lack of good faith on the part of the individual requesting the waiver. Any significant, unexplained increase in pay or allowances which would require a reasonable person to make inquiry concerning the correctness of his pay or allowances, ordinarily would preclude a waiver when the employee or member fails to bring the matter to the attention of appropriate officials (4 C.F.R. Sec. 91.5).

The confusion regarding the member's pay account arose from the fact that he was under temporary pay status due to the Navy's inability to determine his flight pay entry date. The record shows that he received his first LES after almost 15 months on active duty. The record also shows that when he did receive his LES he questioned the apparent overpaid status continuously; that he was advised that the overpaid balance on the LES was necessary to balance his pay account; and that he was being paid the correct pay amount. In addition, the disbursing officer's statement, accompanying the member's waiver request indicates:

"It's possible that the member was not aware of overpayment due to the many times he was reassured by his payclerk that his account was being worked on and that although his LES showed him as being overpaid, he was being paid correctly, although his LES's showed the wrong entitlement and showed him as being over paid."

In view of the fact that the member's pay account remained unbalanced as long as 23 months after he resumed active duty and the assurances he received when he repeatedly questioned his pay, we conclude that he did all that he could reasonably be expected to do to assure himself that his pay was correct. We, therefore, conclude that he was without fault and is thus entitled to waiver of collection of all of the overpayments. Accordingly, the decision of the Claims Group granting partial waiver is sustained and its denial of partial waiver is reversed.