B-143217, JUL. 1, 1963

B-143217, JUL. 1, 1963

TO COMMANDER M. M. ALEXANDER, SC, USN:

REFERENCE IS MADE TO YOUR LETTER DATED MAY 6, 1963, FORWARDING FOR ADVANCE APPROVAL AND CERTIFICATION FOR PAYMENT, THE CLAIM, WITH VOUCHER,OF REAR ADMIRAL CHARLES A. THORWALL FOR DISABILITY RETIRED PAY BASED ON THE RANK OF CAPTAIN BY REASON OF THE CORRECTION OF HIS NAVAL RECORDS, COVERING ADDITIONAL RETIRED PAY FOR THE PERIOD FROM JUNE 11, 1960, TO NOVEMBER 6, 1962, AND ADJUSTMENT OF ANNUITY COST DEDUCTIONS FOR THE PERIOD FROM NOVEMBER 1, 1953, TO NOVEMBER 6, 1962.

IT APPEARS THAT ADMIRAL THORWALL WAS PLACED ON THE NAVAL RESERVE RETIRED LIST, EFFECTIVE AUGUST 1, 1956, IN ACCORDANCE WITH 34 U.S.C. 440H AND 440I (1952 ED.); THAT HAVING BEEN SPECIALLY COMMENDED FOR HIS PERFORMANCE OF DUTY IN ACTUAL COMBAT, HE WAS TRANSFERRED TO THE NAVAL RESERVE RETIRED LIST WITH THE RANK OF REAR ADMIRAL BUT WITH THE RETIRED PAY BASED ON THE GRADE OF CAPTAIN, AND THAT MONTHLY CHECK AGES WERE MADE FROM HIS RETIRED PAY FROM AUGUST 1, 1956, TO COVER ANNUITY COSTS UNDER THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953 (CHAPTER 73, 10 U.S. CODE).

IT ALSO APPEARS THAT ON JUNE 10, 1960, THE DEFENDANT CONCEDED THAT THE PLAINTIFF IN THE CASE OF CHARLES A. THORWALL V. UNITED STATES, CT.CL.NO.15 -56, WAS ENTITLED TO RECOVER DISABILITY RETIRED PAY FROM SEPTEMBER 29, 1947, THE DATE OF THE PLAINTIFF'S LAST RELEASE TO INACTIVE DUTY, UNDER THE PROVISIONS OF SECTION 4 OF THE NAVAL AVIATION PERSONNEL ACT OF 1940, CHAP. 694, 54 STAT. 864; AND THAT JUDGMENT WAS ENTERED ON JANUARY 13, 1961, BY THE COURT OF CLAIMS ON THE DEFENDANT'S ADMISSION OF LIABILITY IN THE AMOUNT OF $37,513.66, REPRESENTING DISABILITY RETIRED PAY COMPUTED PURSUANT TO THE PROVISIONS OF THE 1946 AMENDMENT OF THE PAY READJUSTMENT ACT OF 1942, CHAP. 523, 60 STAT. 343, WITH SUBSEQUENT PERCENTAGE INCREASES, FOR THE PERIOD SEPTEMBER 30, 1947, THROUGH JUNE 10, 1960, LESS ANNUITY COSTS IN THE TOTAL AMOUNT OF $3,639.02 FOR THE PERIOD NOVEMBER 1, 1953, THROUGH JUNE 10, 1960; VETERANS ADMINISTRATION COMPENSATION PAYMENTS FOR THE PERIOD SEPTEMBER 30, 1947, THROUGH JULY 31, 1956; AND NONDISABILITY RETIRED PAY FOR THE PERIOD AUGUST 1, 1956, THROUGH JUNE 10, 1960.

IN OUR DECISION DATED FEBRUARY 19, 1962, IN RESPONSE TO THE QUESTIONS WHETHER REAR ADMIRAL THORWALL IS ENTITLED TO THE DIFFERENCE BETWEEN DISABILITY AND NONDISABILITY RETIRED PAY BEGINNING JUNE 11, 1960, THE DAY FOLLOWING THE TERMINAL DATE OF THE PERIOD COVERED BY THE ABOVE JUDGMENT, AND WHAT EFFECT, IF ANY, THE JUDGMENT HAS ON ANNUITY COSTS FROM JUNE 11, 1960, WE HELD---

"WHILE SEPTEMBER 30, 1947, WAS CONSIDERED AS THE DATE OF RETIREMENT FOR THE PURPOSE OF THE JUDGMENT ENTERED JANUARY 13, 1961, AND ANNUITY COSTS COMPUTED ON THE BASIS OF DISABILITY RETIREMENT PAY AS OF NOVEMBER 1, 1953 (EFFECTIVE DATE OF THE CONTINGENCY OPTION ACT), SUCH COMPUTATIONS ARE RESTRICTED TO THE PERIOD THERE CONSIDERED. INSOFAR AS THE PERIOD FROM JUNE 11, 1960, IS CONCERNED, AS INDICATED IN OUR CONSIDERATION OF YOUR BASIC QUESTION, THE COURT JUDGMENT IS INAPPLICABLE. ADMIRAL THORWALL HAS NOT BEEN RETIRED FOR DISABILITY AND IS NOT ENTITLED TO DISABILITY RETIRED PAY FROM JUNE 11, 1960, HENCE HIS ANNUITY COST DEDUCTIONS REMAIN AS PREVIOUSLY COMPUTED, PREDICATED ON THE NONDISABILITY RETIRED PAY TO WHICH HE BECAME ENTITLED ON AUGUST 1, 1956, AND THE JUDGMENT IS WITHOUT EFFECT ON THE ANNUITY COSTS FROM JUNE 11, 1960.'

IT FURTHER APPEARS THAT ON MARCH 22, 1962, ADMIRAL THORWALL FILED A PETITION, CT.CL.NO. 88-62, IN THE COURT OF CLAIMS SEEKING RECOVERY OF DISABILITY RETIRED PAY FROM JUNE 10, 1960; THAT ON NOVEMBER 7, 1962, THE UNDER SECRETARY OF THE NAVY, ON THE RECOMMENDATION OF THE BOARD FOR CORRECTION OF NAVAL RECORDS, UNDER THE PROVISIONS OF 10 U.S.C. 1552, APPROVED THE BOARD'S DECISION AND RECOMMENDATION AND DIRECTED THAT HIS NAVAL RECORDS BE CORRECTED TO SHOW THAT HIS NAME WAS PLACED ON THE RETIRED LIST BY REASON OF PHYSICAL DISABILITY ON SEPTEMBER 30, 1947, WITH THE RANK AND PAY OF CAPTAIN AND THAT, HAVING BEEN SPECIALLY COMMENDED FOR THE PERFORMANCE OF DUTY IN ACTUAL COMBAT, HE WAS ADVANCED ON THE RETIRED LIST TO THE GRADE OF REAR ADMIRAL, WITH RETIRED PAY IN THE GRADE OF CAPTAIN; THAT FOLLOWING THE CORRECTION OF HIS NAVAL RECORDS, ADMIRAL THORWALL'S ATTORNEY DEPOSITED WITH THE DEPARTMENT OF JUSTICE A MOTION TO DISMISS THE ACTION IN THE COURT OF CLAIMS TO BE HELD IN ESCROW PENDING THE SATISFACTORY SETTLEMENT OF HIS CLAIM FOR DISABILITY RETIRED PAY BY THE ADMINISTRATIVE OFFICES.

IN YOUR LETTER IT IS STATED THAT IN THE COMPUTATION OF THE NET AMOUNT PAID ON THE JUDGMENT RENDERED BY THE COURT OF CLAIMS ON JANUARY 13, 1961, IN THE THORWALL CASE, THERE WAS INCLUDED RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN (RSFPP FORMERLY USCO) ANNUITY COSTS AT $45.87 PER MONTH FOR THE PERIOD NOVEMBER 1, 1953, THROUGH JULY 31, 1956, AND THE DIFFERENCE IN RSFPP ANNUITY DEDUCTIONS BETWEEN $45.87 AND $25.79 PER MONTH FOR THE PERIOD AUGUST 1, 1956, THROUGH JUNE 10, 1960; THAT THE COST FIGURE OF $45.87 WAS ERRONEOUS IN THAT AN ERRONEOUS REDUCTION FACTOR WAS SED; THAT THE FACTOR WAS ERRONEOUSLY OBTAINED FROM THE NONDISABILITY TABLES IN EFFECT PRIOR TO MAY 1, 1954, WHEREAS IT SHOULD HAVE BEEN OBTAINED FROM THE DISABILITY TABLES; AND THAT THE PROPER RSFPP ANNUITY COST IS $51.70 A MONTH (FOR THE PERIOD NOVEMBER 1, 1953, THROUGH NOVEMBER 6, 1962).

YOUR SPECIFIC QUESTION IS WHETHER ADJUSTMENT OF RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN ANNUITY COSTS FROM $45.87 TO $51.70 FOR THE PERIOD NOVEMBER 1, 1953, THROUGH JUNE 10, 1960, THE PERIOD COVERED BY THE COURT JUDGMENT CITED ABOVE, SHOULD BE MADE.

IN DECISION OF JULY 7, 1954, TO THE SECRETARY OF THE ARMY, 34 COMP. GEN. 7, WE AFFIRMED AN EARLIER DECISION THAT PAYMENTS BASED ON CORRECTIONS OF MILITARY OR NAVAL RECORDS EFFECTED UNDER SECTION 207 OF THE LEGISLATIVE REORGANIZATION ACT OF 1946, AS AMENDED BY THE ACT OF OCTOBER 25, 1951, 65 STAT. 655, 5 U.S.C. 191A (NOW 10 U.S.C. 1552), ARE REQUIRED TO BE MADE IN THE AMOUNTS DETERMINED TO BE DUE BY APPLYING PERTINENT LAWS AND REGULATIONS TO ALL THE MATERIAL FACTS SHOWN BY THE RECORDS AS SO CORRECTED. HENCE, THE AMOUNT DUE ADMIRAL THORWALL BY REASON OF THE CORRECTION OF HIS NAVAL RECORDS IS A MATTER OF RECOMPUTATION OF RETIRED PAY ON THE BASIS OF A DISABILITY RETIREMENT RATHER THAN AN ADJUSTMENT OF RETIRED PAY ALREADY RECEIVED ON ANOTHER BASIS. IN OTHER WORDS, IN VIEW OF THE CORRECTION OF HIS NAVAL RECORDS AS INDICATED, ADMIRAL THORWALL IS ENTITLED TO PHYSICAL DISABILITY RETIRED PAY COMPUTED UNDER APPROPRIATE PAY STATUTES FOR THE PERIOD SEPTEMBER 30, 1947, THROUGH NOVEMBER 6, 1962, LESS APPROPRIATE ADJUSTMENTS FOR PAYMENTS RECEIVED BY HIM FROM THE VETERANS ADMINISTRATION FOR DISABILITY, NONDISABILITY RETIRED PAY PAYMENTS, THE AMOUNT OF THE JUDGMENT OBTAINED IN THE COURT OF CLAIMS IN CASE NO. 15 56, AND RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN ANNUITY COSTS IN THE PROPER AMOUNT OF $51.70 A MONTH FROM NOVEMBER 1, 1953. SINCE THE VOUCHER ACCOMPANYING YOUR LETTER IS NOT IN ACCORD WITH THE ABOVE, IT IS RETAINED HERE. A NEW VOUCHER, COMPUTED ON THE BASIS INDICATED, IN FAVOR OF ADMIRAL THORWALL MAY BE PAID, IF OTHERWISE CORRECT.

UPON ACCEPTANCE OF THE SETTLEMENT BY THE CLAIMANT, AND ISSUANCE OF THE CHECK IN PAYMENT THEREOF, THE DEPARTMENT OF JUSTICE SHOULD BE IMMEDIATELY NOTIFIED IN ORDER THAT IT MAY TAKE THE NECESSARY STEPS TO FILE IN THE COURT OF CLAIMS THE MOTION TO DISMISS IT NOW HOLDS IN ESCROW.