Matter of: Master Sergeant George M. McClain, USAF (Retired) (Deceased) File: B-248017 Date: September 16, 1992

Matter of: Master Sergeant George M. McClain, USAF (Retired) (Deceased) File: B-248017 Date: September 16, 1992

MILITARY PERSONNEL Pay Survivor benefits Benefit election Election time periods Former spouses Where divorce decree stated that member's former spouse was to be designated beneficiary under Survivor Benefit Plan (SBP) and both member and former spouse, under deemed election provisions, fail to take action to effect such election within 1-year period after divorce, subsequent court order holding member in contempt for failing to make such an election is without effect to extend or open a new 1-year period for such an election. Subsequent court order imposed no new obligation on member regarding SBP coverage.

DECISION

Mary Smith McClain has requested reconsideration of our Claims Group's action denying her request to be named the beneficiary of the Survivor Benefit Plan (SBP) annuity of her ex-spouse, Master Sergeant George M. McClain, USAF (Retired) (Deceased). For the reasons stated below, we affirm the action of the Claims Group.

MSgt McClain married Mary Smith McClain on September 19, 1956 and retired from the Air Force on October 3, 1971. On September 21, 1972, he elected reduced SBP spouse and child coverage. MSgt McClain and Mary Smith McClain were divorced on September 23, 1986. In the divorce proceedings, MSgt McClain agreed to continue to pay the SBP premiums and to continue Mary Smith McClain as the beneficiary of the annuity.

However, MSgt McClain did not make a former spouse election within 1 year of the date of the divorce decree as required by 10 U.S.C. Sec. 1448(b)(3)(A) nor did Mary Smith McClain request a "deemed election" within 1 year of the issuance of the decree as required by 10 U.S.C. Sec. 1450(f)(3)(A) & (B).

On August 25, 1989, MSgt McClain married Mary Caldwell McClain. On June 1, 1990, MSgt McClain's SBP deduction was reduced to provide spouse only coverage since there were no longer eligible children and as of that date, Mary Smith McClain was still listed as the SBP beneficiary. Later in the year, MSgt McClain health began to fail and he executed a Last Will and Testament in which he bequeathed his SBP annuity to Mary Smith McClain. Subsequently, Mary Smith McClain discovered that she was not the SBP beneficiary because of the failure of MSgt McClain or herself to make the required requests for election of former spouse coverage within 1 year of the divorce decree.

On March 18, 1991, the court that issued the divorce decree found MSgt McClain in contempt for failure to make the election and ordered him to do so. MSgt McClain died on April 13, 1991.

The Defense Finance and Accounting Service denied Mary Smith McClain's claim for the SBP annuity based on the failure to file a timely election and found that the court order of March 18, 1991 was without effect to permit such an election to be made after the lapse of the initial 1-year period.

Our Office has recently decided several cases involving the effect of the issuance of subsequent court orders on the ability of former spouses to file for elections after the initial 1-year period has passed. In Nawanna Driggers, B-244101, Aug. 3, 1992, we concluded that an order that merely reiterated an earlier order that SBP be elected for a former spouse did not begin a new 1-year period for electing coverage. The critical element for the election of the coverage is when the substantive obligation to make such an election was imposed. If the election of former spouse coverage was agreed to or ordered by an earlier court order, a subsequent order or modification that merely restates the previous provision and imposes no new obligation on the member does not begin a new 1-year period. See also, Constance L. Posner, B-245295.2, Aug. 3, 1992.

Here, MSgt McClain was obligated, based on the September 23, 1986 divorce decree, to continue Mary Smith McClain as his SBP beneficiary. Under the SBP law, as written at that time, either he or Mary (through a "deemed election") had 1 year to file with the Secretary for such coverage. The subsequent order dated March 18, 1991 did not add to or change this obligation but merely held MSgt McClain in contempt of court for failing to fulfill the prior agreement. This is not the type of court order or modification of a court order that can be used to begin a new 1-year period to deem an election.

We have also held that amounts payable from federal funds under federal law to the survivors of deceased service members are not assets of the members' estates, and that such amounts due may not be paid in any manner other than as specified by the applicable federal statutes. Master Chief Petty Officer John W. Todd, USN (Retired) (Deceased), B-230824, Nov.14, 1988. Therefore, service members may not dispose of SBP annuities by will or other testamentary instrument, since no provision of federal law authorizes them to do so, and MSgt McClain's designation in his will of his former spouse as the beneficiary of his SBP annuity is without effect.

The action of the Claims Group is affirmed.

Date: From: General Counsel - James F. Hinchman

Subject: MSgt George M. McClain, USAF--(B-248017)-- Z-2867421

Returned is Claims File No. Z-2867421 and a copy of our decision of today's date, affirming the Claims Group action.