B-49292, JULY 31, 1945, 25 COMP. GEN. 144

B-49292: Jul 31, 1945

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SAVINGS DEPOSITS - NAVY ENLISTED MEN TRANSFERRED TO FLEET RESERVE AND RETAINED ON ACTIVE DUTY A NAVY ENLISTED MAN TRANSFERRED TO THE FLEET RESERVE AND RETAINED ON ACTIVE DUTY AS A RESERVIST FOR AN EXTENDED PERIOD IS ENTITLED UNDER THE ACT OF FEBRUARY 9. AS FOLLOWS: THERE IS FORWARDED HEREWITH A LETTER FROM THE DISBURSING OFFICER. YOUR DECISION IS REQUESTED ON THE QUESTION AS TO WHETHER OR NOT ELECTRICIAN ALLEN IS ENTITLED TO PAYMENT OF INTEREST ON HIS SAVINGS DEPOSIT FOR THE PERIOD FROM DATE OF TRANSFER TO THE FLEET RESERVE TO THE DATE OF HIS TEMPORARY APPOINTMENT TO THE RANK OF WARRANT OFFICER. IS. I HAVE DECLINED TO MAKE PAYMENT OF THIS INTEREST DUE TO THE PRESENT INSTRUCTIONS AS CONTAINED IN REFERENCE (B) ( ARTICLE 2166-6 (A) BUSAND A MANUAL) AND CONTEND THAT THE TOTAL OF DEPOSITS AND INTEREST SHOULD HAVE BEEN PAID ALLAN ON BEING TRANSFERRED TO THE FLEET RESERVE.

B-49292, JULY 31, 1945, 25 COMP. GEN. 144

SAVINGS DEPOSITS - NAVY ENLISTED MEN TRANSFERRED TO FLEET RESERVE AND RETAINED ON ACTIVE DUTY A NAVY ENLISTED MAN TRANSFERRED TO THE FLEET RESERVE AND RETAINED ON ACTIVE DUTY AS A RESERVIST FOR AN EXTENDED PERIOD IS ENTITLED UNDER THE ACT OF FEBRUARY 9, 1889, TO MAKE DEPOSITS OF PAY AND TO BE CREDITED WITH ACCRUED INTEREST THEREON FOR THE PERIOD OF SUCH ACTIVE DUTY.

ASSISTANT COMPTROLLER GENERAL YATES TO THE SECRETARY OF THE NAVY, JULY 31, 1945:

THERE HAS BEEN CONSIDERED YOUR LETTER OF APRIL 20, 1945, AS FOLLOWS:

THERE IS FORWARDED HEREWITH A LETTER FROM THE DISBURSING OFFICER, U.S.S. ALSHAIN, DATED FEBRUARY 21, 1945, WITH ENCLOSURES AND ACCOMPANYING ENDORSEMENT, THEREON, RELATIVE TO THE CLAIM OF ELECTRICIAN JAMES COOPER ALLEN, USN, 242-35-74, FOR PAYMENT OF INTEREST ON SAVINGS DEPOSIT FOR THE PERIOD SEPTEMBER 6, 1940, TO DECEMBER 14, 1944.

YOUR DECISION IS REQUESTED ON THE QUESTION AS TO WHETHER OR NOT ELECTRICIAN ALLEN IS ENTITLED TO PAYMENT OF INTEREST ON HIS SAVINGS DEPOSIT FOR THE PERIOD FROM DATE OF TRANSFER TO THE FLEET RESERVE TO THE DATE OF HIS TEMPORARY APPOINTMENT TO THE RANK OF WARRANT OFFICER, UNDER THE CONDITIONS SET FORTH IN THE ENCLOSURE.

THE LETTER FROM THE DISBURSING OFFICER, U.S.S. ALSHAIN, IS, IN PERTINENT PART, AS FOLLOWS:

2. I HAVE DECLINED TO MAKE PAYMENT OF THIS INTEREST DUE TO THE PRESENT INSTRUCTIONS AS CONTAINED IN REFERENCE (B) ( ARTICLE 2166-6 (A) BUSAND A MANUAL) AND CONTEND THAT THE TOTAL OF DEPOSITS AND INTEREST SHOULD HAVE BEEN PAID ALLAN ON BEING TRANSFERRED TO THE FLEET RESERVE. I PAID ALLAN THE SUM OF HIS SAVINGS DEPOSITS AND INTERESTS UP TO THE EFFECTIVE DATE OF HIS TRANSFER TO THE FLEET RESERVE. THIS WAS PAID ON PUBLIC VOUCHER NO. 92 -45 DATED 2/17/45 IN THE AMOUNT OF FOUR THOUSAND THREE HUNDRED FIVE DOLLARS AND FIFTY NINE CENTS ($4,305.59) IN ACCORDANCE WITH REFERENCE (C) ( ARTICLE 2166-6 (B) BUS AND A MANUAL).

3. IF THE BUREAU OF SUPPLIES AND ACCOUNTS CONTENDS THAT THE CLAIM MAY BE SETTLED BY THE DISBURSING OFFICER CARRYING THE ACCOUNTS OF ALLAN, I WILL BE MORE THAN GLAD TO COMPLY.

IN THE ABSENCE OF ANY INDICATION TO THE CONTRARY, IT IS ASSUMED THAT THE FACTS INVOLVED IN THE MATTER ARE THOSE SET FORTH IN THE " STATEMENT OF FACTS" SUBMITTED BY MR. ALLAN IN CONNECTION WITH HIS APPLICATION FOR PAYMENT OF INTEREST ON HIS SAVINGS DEPOSIT, AS FOLLOWS:

ON SEPTEMBER 1, 1937 WHILE ON DUTY ABOARD THE U.S.S. POPE I MADE A SAVINGS DEPOSIT OF FIFTEEN HUNDRED DOLLARS ($1,500.00) AND WAS ISSUED DEPOSIT BOOK NO. 39834 BY J. W. BOUNDY. SUBSEQUENT DEPOSITS WERE MADE WHILE ON DUTY ABOARD THE U.S.S. MARBLE HEAD AND U.S.S. ANTARES. THE LAST DEPOSIT WAS MADE WHILE ABOARD THE U.S.S. ANTARES IN AUGUST 1940 AND THE DEPOSIT RECORD BOOK SHOWED A BALANCE ON DEPOSIT OF FOUR THOUSAND DOLLARS ($4,000.00) AT THAT TIME.

ON SEPTEMBER 5, 1940, WHILE ABOARD THE U.S.S. ANTARES, I WAS TRANSFERRED TO THE FLEET RESERVE, CLASS F4D ON AUTHORITY OF BUNAV. TR., NAV.-66- HJP/MM 242 35 74 OF AUGUST 8, 1940 AND RETAINED ABOARD ON ACTIVE DUTY IN ACCORDANCE WITH A1NAV 4713-1200 OF SEPTEMBER 1939. AT THE TIME OF TRANSFER TO THE FLEET RESERVE, I WAS INFORMED THAT I WAS NOT ENTITLED TO MY SAVINGS DEPOSITS AND INTEREST THEREON DUE TO THE FACT THAT I WAS RETAINED ON BOARD FOR ACTIVE DUTY AND WAS NOT BEING PAID OFF AND THAT I WOULD CONTINUE TO DRAW INTEREST ON THE MONEY DEPOSITED.

ON FEBRUARY 18, 1945, I ACCEPTED APPOINTED AS WARRANT ELECTRICIAN (T), U.S. NAVY MADE BY THE PRESIDENT OF THE UNITED STATES ON DECEMBER 15, 1944. IN ACCORDANCE WITH ARTICLE 2166-6 BUSAND A MANUAL I WAS ENTITLED TO BE PAID MY SAVINGS DEPOSITS AND ACCUMULATED INTEREST. MY DISBURSING OFFICER PAID ME MY DEPOSIT PLUS INTEREST AT 4 PERCENT UP TO AND INCLUDING THE DATE OF TRANSFER TO THE FLEET RESERVE ( SEPTEMBER 5, 1940,) BUT WOULD NOT PAY ME INTEREST FROM SEPTEMBER 6, 1940 TO DECEMBER 14, 1944 STATING THAT IN ACCORDANCE WITH PRESENT INSTRUCTIONS IN BUS AND A MANUAL, I SHOULD HAVE BEEN PAID MY SAVINGS DEPOSITS AND INTEREST WHEN I WAS TRANSFERRED TO THE FLEET RESERVE.

DUE TO THE MISINFORMATION I RECEIVED AT THE TIME OF TRANSFER TO THE FLEET RESERVE, OR A CHANGE IN THE INSTRUCTIONS IN ARTICLE 2166-6 BUSAND A MANUAL, I BELIEVE THAT I AM ENTITLED TO INTEREST AT FOUR PERCENT (4 PERCENT) ON FOUR THOUSAND DOLLARS ($4,000.00) ON DEPOSIT FROM SEPTEMBER 6, 1940 UP TO DECEMBER 14, 1944, INCLUSIVE (THE DAY PRECEDING MY APPOINTMENT AS WARRANT ELECTRICIAN), WHICH AMOUNTS TO SIX HUNDRED EIGHTY FOUR DOLLARS AND NO CENTS ($684.00.)

THE ACT OF FEBRUARY 9, 1889, 25 STAT. 657, 658, PROVIDES:

THAT ANY ENLISTED MAN OR APPOINTED PETTY OFFICER OF THE NAVY MAY DEPOSIT HIS SAVINGS, IN SUMS NOT LESS THAN FIVE DOLLARS, WITH THE PAYMASTER UPON WHOSE BOOKS HIS ACCOUNT IS BORNE; AND HE SHALL BE FURNISHED WITH A DEPOSIT BOOK, IN WHICH THE SAID PAYMASTER SHALL NOTE, OVER HIS SIGNATURE, THE AMOUNT, DATE, AND PLACE OF SUCH DEPOSIT. THE MONEY SO DEPOSITED SHALL BE ACCOUNTED FOR IN THE SAME MANNER AS OTHER PUBLIC FUNDS, AND SHALL PASS TO THE CREDIT OF THE APPROPRIATION FOR " PAY FOR THE NAVY," AND SHALL NOT BE SUBJECT TO FORFEITURE BY SENTENCE OF COURT-MARTIAL, BUT SHALL BE FORFEITED BY DESERTION, AND SHALL NOT BE PERMITTED TO BE PAID UNTIL FINAL PAYMENT ON DISCHARGE, OR TO THE HEIRS OR REPRESENTATIVES OF A DECEASED SAILOR, AND THAT SUCH DEPOSIT BE EXEMPT FROM LIABILITY FOR SUCH SAILOR'S DEBTS: PROVIDED, THAT THE GOVERNMENT SHALL BE LIABLE FOR THE AMOUNT DEPOSITED TO THE PERSON SO DEPOSITING THE SAME.

SEC. 2. THAT FOR ANY SUMS NOT LESS THAN FIVE DOLLARS SO DEPOSITED FOR THE PERIOD OF SIX MONTHS OR LONGER, THE SAILOR, ON HIS FINAL DISCHARGE, SHALL BE PAID INTEREST AT THE RATE OF FOUR PERCENTUM PER ANNUM.

SEC. 3. THAT THE SYSTEM OF DEPOSITS HEREIN ESTABLISHED, SHALL BE CARRIED INTO EXECUTION UNDER SUCH REGULATIONS AS MAY BE ESTABLISHED BY THE SECRETARY OF THE NAVY.

CURRENT INSTRUCTIONS RESPECTING SAVINGS DEPOSITS AUTHORIZED UNDER THE QUOTED ACT ARE CONTAINED IN ARTICLE 2166 OF THE BUREAU OF SUPPLIES AND ACCOUNTS MANUAL (CHANGE 40, DATED JULY 1, 1944,) AND PARAGRAPH 6 THEREOF-- - CITED BY THE DISBURSING OFFICER AS THE AUTHORITY UPON BASED HIS REFUSAL TO PAY INTEREST ON THE CLAIMANT'S SAVINGS DEPOSITS AF HIS TRANSFER TO THE FLEET RESERVE--- READS AS FOLLOWS:

6. REPAYMENT OF DEPOSITS WITH INTEREST UPON DISCHARGE OR RELEASE FROM ACTIVE DUTY.---

(A) IN GENERAL.---

(1) SEE ART. 1781 (7), N.R.

(2) UPON DISCHARGE OR RELEASE FROM ACTIVE DUTY, THE OFFICER CLOSING THE PAY ACCOUNT OF THE DEPOSITOR SHALL MAKE PAYMENT IN FULL, WITH INTEREST, OF ALL SUMS DEPOSITED DURING THE ENLISTMENT.

(3) AN ENLISTED MAN TEMPORARILY OR PERMANENTLY APPOINTED TO WARRANT OR COMMISSIONED RANK SHALL BE REPAID HIS DEPOSIT WITH INTEREST COMPUTED TO THE DATE PRECEDING THE EFFECTIVE DATE OF APPOINTMENT.

(4) AN ENLISTED MAN TRANSFERRED TO THE FLEET RESERVE SHALL BE REPAID HIS DEPOSITS WITH INTEREST COMPUTED TO THE EFFECTIVE DATE OF SUCH TRANSFER. WHILE THE QUOTED INSTRUCTIONS ARE SUBSTANTIALLY THE SAME AS THOSE IN EFFECT AT THE TIME OF THE CLAIMANT'S TRANSFER TO THE FLEET RESERVE THEY ARE NOT IDENTICAL THEREWITH IN ALL RESPECTS. PARAGRAPH 7, ARTICLE 2166, BUREAU OF SUPPLIES AND ACCOUNTS MANUAL (CHANGE 19, DATED JANUARY 1, 1939/- -- IN EFFECT WHEN ALLAN WAS TRANSFERRED TO THE FLEET RESERVE--- PROVIDED, IN PERTINENT PART, AS FOLLOWS:

7. PAYMENT OF DEPOSIT AND INTEREST UPON DISCHARGE.---

(D) WHEN AN ENLISTED MAN IS TRANSFERRED TO THE FLEET RESERVE, HE IS ENTITLED AT DATE OF SUCH TRANSFER TO BE PAID, WITH INTEREST, ANY DEPOSITS PREVIOUSLY MADE BY HIM. (COMP. DEC. JAN. 17, 1917.)

(F) DEPOSITS MADE BY MEN HOLDING ENLISTED RATINGS IN THE NAVAL RESERVE, MARINE CORPS RESERVE, AND THE NAVAL MILITIA ON ACTIVE DUTY WILL BE REPAID WITH INTEREST ON THE DATE OF DETACHMENT FROM SAID ACTIVE DUTY. (COMP. DEC. JULY 3, 1917.)

AS INDICATED, SUBPARAGRAPH (D), ABOVE, OF THE 1939 INSTRUCTIONS, WAS BASED UPON A DECISION DATED JANUARY 17, 1917, OF THE COMPTROLLER OF THE TREASURY, IN WHICH THERE WAS CONSIDERED THE QUESTION PRESENTED BY THE SECRETARY OF THE NAVY AS TO WHETHER ENLISTED MEN OF THE REGULAR NAVY TRANSFERRED TO THE FLEET NAVAL RESERVE, WERE, BY SUCH TRANSFER, TO BE CONSIDERED AS "DISCHARGED" WITHIN THE MEANING OF THE ACT OF FEBRUARY 9, 1889, SUPRA, SO AS TO ENTITLE THEM, ON THE DATE OF SUCH TRANSFER, TO PAYMENT OF THEIR SAVINGS DEPOSITS WITH INTEREST. IT WAS STATED IN THE DECISION THAT---

THE TRANSFER OF ENLISTED MEN FROM THE REGULAR NAVY TO THE FLEET NAVAL RESERVE TERMINATES THEIR STATUS AS ENLISTED MEN OF THE REGULAR NAVY AS COMPLETELY AS WOULD THEIR DISCHARGE IN FACT FROM THEIR ENLISTMENTS, AND IS I THINK THE EQUIVALENT OF SUCH A DISCHARGE FOR THE PURPOSE OF THE PAYMENT TO THEM ON FINAL PAYMENT FOR THEIR SERVICES IN SUCH ENLISTMENTS OF DEPOSITS AND INTEREST * * * . THERE WAS NOT INVOLVED IN THAT DECISION THE QUESTION OF THE RIGHTS OF ENLISTED MEN OF THE REGULAR NAVY SO TRANSFERRED, BUT RETAINED ON ACTIVE DUTY, TO CONTINUE THEIR SAVINGS ACCOUNTS OR TO MAKE DEPOSITS THEREIN WHILE THUS REMAINING ON ACTIVE DUTY. HOWEVER, AS INDICATED BY SUBPARAGRAPH (F) OF THE 1939 INSTRUCTIONS, SUPRA, THE COMPTROLLER OF THE TREASURY IN HIS SUBSEQUENT DECISION OF JULY 3, 1917, RECOGNIZED THE RIGHT OF MEMBERS OF THE NAVAL RESERVE FORCE CREATED BY THE ACT OF AUGUST 29, 1916, 39 STAT. 587--- WHICH INCLUDED THE FLEET NAVAL RESERVE, THE FORERUNNER OF THE PRESENT FLEET RESERVE--- TO MAKE DEPOSITS OF SAVINGS AND TO RECEIVE INTEREST THEREON DURING PERIODS OF EXTENDED ACTIVE DUTY IN TIME OF WAR OR NATIONAL EMERGENCY. AND, IN DECISION OF THIS OFFICE DATED APRIL 24, 1937, 16 COMP. GEN. 960, WITH RESPECT TO THE RIGHTS OF MEMBERS OF THE NAVAL RESERVE (WHICH INCLUDES THE FLEET RESERVE) AND THE MARINE CORPS RESERVE AS ESTABLISHED BY THE ACT OF FEBRUARY 28, 1925, 43 STAT. 1080-- WHICH REPEALED THE 1916 ACT, SUPRA--- TO MAKE DEPOSITS OF SAVINGS WHILE ON EXTENDED ACTIVE DUTY IN TIME OF PEACE, IT WAS STATED, AFTER A DISCUSSION OF THE SAID DECISION OF JULY 3, 1917, THAT---

THE ACT OF FEBRUARY 28, 1925, 43 STAT. 1080, CREATING THE NAVAL RESERVE AND THE MARINE CORPS RESERVE AS COMPONENTS OF THE REGULAR NAVY AND THE REGULAR MARINE CORPS OF THE UNITED STATES CONTAINS NOTHING WHICH WOULD REQUIRE DENYING TO ENLISTED RESERVISTS ON EXTENDED ACTIVE DUTY THE SAME RIGHT TO MAKE DEPOSITS OF THEIR PAY AND RECEIVE INTEREST THEREON AS WAS HELD TO BE AUTHORIZED FOR MEMBERS OF THE NAVAL RESERVE FORCE ON EXTENDED ACTIVE DUTY, UNDER THE CITED ACTS PROVIDING FOR SAVINGS DEPOSITS BY ENLISTED MEN OF THE NAVY AND MARINE CORPS.

THE NAVAL RESERVE ACT OF 1938, 52 STAT. 1175, WHICH REPEALED THE SAID ACT OF FEBRUARY 28, 1925, AND ESTABLISHED THE NAVAL RESERVE AS NOW CONSTITUTED, PROVIDES THAT THE NAVAL RESERVE "SHALL CONSIST OF THE FLEET RESERVE, THE ORGANIZED RESERVE, THE MERCHANT MARINE RESERVE, AND THE VOLUNTEER RESERVE.' THE PROVISIONS IN THE 1938 ACT RESPECTING PAY, ALLOWANCES, ETC., AUTHORIZED FOR MEMBERS OF THE NAVAL RESERVE ON ACTIVE DUTY ARE PRACTICALLY THE SAME AS THOSE CONTAINED IN THE 1925 ACT; AND WHAT WAS SAID IN THE DECISION OF APRIL 24, 1937, SUPRA, RELATIVE TO THE RIGHTS OF RESERVISTS UNDER THE EARLIER ACT TO DEPOSIT SAVINGS WHILE ON EXTENDED ACTIVE DUTY WOULD APPLY WITH EQUAL FORCE TO MEMBERS OF THE PRESENT NAVAL RESERVE, AS ESTABLISHED UNDER THE 1938 ACT. CONSEQUENTLY, THE ENLISTED MAN HERE INVOLVED, HAVING BEEN TRANSFERRED TO THE FLEET RESERVE AND RETAINED ON ACTIVE DUTY, WAS ENTITLED, BY VIRTUE OF HIS THEN EXISTING STATUS AS A NAVAL RESERVIST ON EXTENDED ACTIVE DUTY, TO MAKE DEPOSITS OF PAY AND TO BE CREDITED WITH ACCRUED INTEREST THEREON FOR THE PERIOD OF SUCH ACTIVE DUTY. HENCE, THERE APPEARS NO LEGAL OBJECTION TO THE PAYMENT TO HIM OF INTEREST ON HIS DEPOSIT BALANCE SUBSEQUENT TO THE DATE OF HIS TRANSFER TO THE FLEET RESERVE FOR THE PERIOD HE WAS RETAINED ON ACTIVE DUTY AS SUCH RESERVIST PRIOR TO HIS TEMPORARY APPOINTMENT AS A WARRANT OFFICER.

ACCORDINGLY, ON THE FACTS STATED BY MR. ALLAN, THE QUESTION IN THE SECOND PARAGRAPH OF YOUR LETTER IS ANSWERED IN THE AFFIRMATIVE.