B-165543, JUNE 11, 1970, 49 COMP. GEN. 837

B-165543, JUNE 11, 1970, 49 COMP. GEN. 837

PAY -- RETIRED -- ANNUITY ELECTIONS FOR DEPENDENTS -- REVOCATION, ETC. - INEFFECTIVE AN ARMY OFFICER WHO WHEN INFORMED THAT HE MAY NOT REVOKE THE REDUCED ANNUITY PROVIDED FOR HIS WIFE UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN REQUESTED ON DATE OF RETIREMENT, AND THAT HE MAY ONLY FURTHER REDUCE THE ANNUITY OR WITHDRAW FROM THE PLAN PURSUANT TO 10 U.S.C. 1436(B), AND THAT HIS REQUEST WOULD BE CONSIDERED A WITHDRAWAL, SELECTS A FURTHER ANNUITY DEDUCTION WITH THE EXPLANATION HE WAS NOT PREVIOUSLY AWARE OF THE SELECTIONS AVAILABLE TO HIM, IS CONSIDERED TO HAVE SUBMITTED A PROPER APPLICATION FOR A REDUCED ANNUITY. WHERE A MEMBER'S REQUEST FOR A CHANGE IN ELECTION OVERLOOKS CERTAIN FACTORS, SECRETARIAL APPROVAL SHOULD BE WITHHELD UNTIL THE DOUBT IS RESOLVED, AND IF THE MEMBER WAS INFORMED THAT HIS DOUBTFUL REQUEST WILL BE CONSIDERED AN APPLICATION FOR REDUCTION OR WITHDRAWAL, SUCH A REQUEST IS ONLY A "PROPER APPLICATION" UPON AFFIRMATION.

TO SECRETARY OF THE ARMY, JUNE 11, 1970:

FURTHER REFERENCE IS MADE TO LETTER OF MAY 4, 1970, FROM THE ASSISTANT SECRETARY OF THE ARMY (FINANCIAL MANAGEMENT), REQUESTING A DECISION IN THE CASE OF BRIGADIER GENERAL NORMAN E. PEATFIELD, AS TO THE TREATMENT TO BE ACCORDED HIS REQUEST FOR REVOCATION AND SUBSEQUENT APPLICATION FOR A REDUCTION IN ANNUITY HE ELECTED UNDER THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431-1446. THE LETTER STATES THAT THIS REQUEST HAS BEEN ASSIGNED SUBMISSION NO. SS-A 1071 BY THE DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE.

IT IS REPORTED THAT ON MARCH 19, 1965, GENERAL PEATFIELD ELECTED OPTION I WITH OPTION IV AT ONE-HALF REDUCED RETIRED PAY. ON SEPTEMBER 17, 1965, A CHANGE FROM ONE-HALF TO ONE-FOURTH REDUCED RETIRED PAY WAS FILED BY THE OFFICER. HE RETIRED FROM ACTIVE DUTY ON SEPTEMBER 1, 1969. OPTION I AT ONE-FOURTH OF FULL RETIRED PAY WAS ESTABLISHED EFFECTIVE SEPTEMBER 1, 1969.

GENERAL PEATFIELD, BY LETTER DATED SEPTEMBER 1, 1969, REQUESTED THAT HIS OPTIONS UNDER THE PLAN BE "REVOKED." SUBSEQUENTLY THE FINANCE CENTER, U.S. ARMY, ADVISED THE OFFICER BY LETTER OF SEPTEMBER 23, 1969, THAT A RETIRED MEMBER MAY NOT REVOKE AN ELECTION BUT THAT HE CAN EITHER REDUCE THE AMOUNT OF THE ANNUITY ELECTED OR WITHDRAW FROM PARTICIPATION IN THE PLAN UNDER THE PROVISIONS OF 10 U.S.C. 1436(B)(1) OR (2). THIS LETTER ALSO INFORMED THE OFFICER THAT HIS LETTER DATED SEPTEMBER 1, 1969, WOULD BE CONSIDERED AS A REQUEST FOR WITHDRAWAL FROM THE PLAN, AND WOULD BE EFFECTIVE APRIL 1, 1970, THE FIRST DAY OF THE SEVENTH MONTH FOLLOWING THE MONTH OF APPLICATION. IN RESPONSE GENERAL PEATFIELD IN LETTER DATED SEPTEMBER 30, 1969, STATED THAT IF PERMITTED, RATHER THAN WITHDRAW FROM PARTICIPATION IN THE PLAN, HE WOULD LIKE TO REDUCE THE AMOUNT OF THE ANNUITY TO HIS WIFE TO $200 PER MONTH. THE STATED REASON FOR THIS ACTION BEING THAT HE WAS NOT PREVIOUSLY AWARE OF THE SELECTIONS AVAILABLE TO HIM. IN VIEW OF THE DOUBT WHICH HIS REPLY RAISED AS TO THE MEMBER'S INTENT TO REQUEST A WITHDRAWAL, THE APPLICATION HAS NOT BEEN FORMALLY APPROVED.

THE ASSISTANT SECRETARY IN HIS LETTER STATES:

IN A DECISION OF THE COMPTROLLER GENERAL, 48 COMP. GEN. 353, IN RESPONSE TO A SECRETARIAL REQUEST BASED ON MPAC COMMITTEE ACTION NO. 424, IT WAS HELD THAT UNDER THE LAW (PL 90-485) THE SECRETARY WAS WITHOUT DISCRETION TO ALLOW OR DISALLOW AN APPLICATION BASED ON HIS DETERMINATION AS TO WHETHER THE WITHDRAWAL (OR REDUCTION) WAS IN THE BEST INTEREST OF THE RETIRED MEMBER OR HIS BENEFICIARIES. THE COMPTROLLER GENERAL SIGNIFICANTLY ADDED THAT " *** IN THE ABSENCE OF EVIDENCE INDICATING THAT HE HAS OVERLOOKED CERTAIN FACTORS OR INFORMATION WHICH SHOULD BE BROUGHT TO HIS ATTENTION, HIS APPLICATION UNDER THE REDUCTION/WITHDRAWAL PROVISIONS OF THE NEW LAW SHOULD BE APPROVED AS A MATTER OF COURSE."

IN THE SAME DECISION, IT WAS ALSO HELD THAT THE SECRETARY COULD NOT APPROVE AN APPLICATION (UNDER 10 U.S.C. 1436(B)) AND LATER CANCEL THE APPROVAL PRIOR TO THE EFFECTIVE DATE; NOR COULD THE SECRETARY PROPERLY DEFER HIS APPROVAL ACTION UNTIL THE (6 MONTH) WAITING PERIOD HAD NEARLY EXPIRED, BUT MUST ACT WITHIN A REASONABLE TIME AFTER RECEIVING THE APPLICATION. AND FINALLY, THAT A MEMBER MAY NOT CANCEL HIS APPLICATION PRIOR TO THE SECRETARY'S APPROVAL OF THE APPLICATION NOR CANCEL THE APPLICATION AFTER APPROVAL AND BEFORE THE EFFECTIVE DATE. AS TO MEMBER'S ATTEMPTED CANCELLATION PRIOR TO APPROVAL, THE COMPTROLLER GENERAL STATED THAT THE SIX-MONTH WAITING PERIOD (BETWEEN APPLICATION AND EFFECTIVE DATE) WAS NOT INTENDED TO AFFORD THE MEMBER A PERIOD IN WHICH TO VACILLATE BETWEEN STAYING IN OR WITHDRAWING AND THAT "A PROPER APPLICATION" FOR WITHDRAWAL (OR REDUCTION) RECEIVED BY THE PROPER AUTHORITY BECOMES EFFECTIVE THE FIRST DAY OF THE SEVENTH MONTH AFTER HE APPLIES.

IN LIGHT OF THE FOREGOING FACTS AND DECISION, AND DUE TO THE LANGUAGE OF THE REQUEST DATED SEPTEMBER 1, 1969, THE ASSISTANT SECRETARY EXPRESSES DOUBT AS TO WHETHER IT WAS A VALID APPLICATION, WHICH WOULD REQUIRE APPROVAL.

IN 48 COMP. GEN. 353, 355 (1968), IT WAS STATED THAT:

*** THE MEMBER INVOLVED HAS THE BEST KNOWLEDGE OF HIS OWN FINANCIAL SITUATION OR OTHER CIRCUMSTANCES WHICH MIGHT MOTIVATE HIM TO MAKE AN ELECTION UNDER 10 U.S.C. 1436(B)(1) OR (2) AND IN THE ABSENCE OF EVIDENCE INDICATING THAT HE HAS OVERLOOKED CERTAIN FACTORS OR INFORMATION WHICH SHOULD BE BROUGHT TO HIS ATTENTION, HIS APPLICATION UNDER THE REDUCTION/WITHDRAWAL PROVISIONS OF THE NEW LAW SHOULD BE APPROVED AS A MATTER OF COURSE.

IT SEEMS CLEAR THAT ON SEPTEMBER 1, 1969, GENERAL PEATFIELD WANTED TO GET OUT OF THE PROGRAM. HOWEVER, THE FACT THAT HE USED THE TERM "REVOKED" RAISES DOUBT AS TO THE EXTENT OF THE INFORMATION HE HAD AT THE TIME OF HIS REQUEST, CONCERNING REDUCTION OF THE ANNUITY AND WITHDRAWAL FROM THE PLAN. HIS LETTER OF SEPTEMBER 30, 1969, INDICATES THAT HE WAS NOT AWARE OF THE SELECTIONS OPEN TO HIM AT THE TIME OF HIS ATTEMPTED REVOCATION. ARE OF THE OPINION THAT THE RECORD BEFORE US INDICATES THAT HE HAD "OVERLOOKED CERTAIN FACTORS OR INFORMATION WHICH SHOULD BE BROUGHT TO HIS ATTENTION." THUS, IN A CASE SUCH AS THIS, WHERE DOUBT EXISTS AS TO WHETHER THE MEMBER DESIRES TO WITHDRAW UNDER SECTION 1436(B) OR IS POSSIBLY SEEKING ACTION UNDER A DIFFERENT PROVISION OF THE LAW, HE SHOULD BE INFORMED HIS REQUEST MAY BE CONSIDERED AN APPLICATION FOR WITHDRAWAL, IF HE SO DESIRES, AND HE SHOULD BE GIVEN A REASONABLE TIME TO AFFIRM OR REJECT THIS ACTION, OR STATE HIS ACTUAL INTENT CONCERNING THE WITHDRAWAL OR REDUCTION PROVISIONS, IF THE EVIDENCE INDICATES HE HAD NOT PREVIOUSLY BEEN AWARE OF THESE PROVISIONS. UNTIL SUCH TIME, SECRETARIAL APPROVAL SHOULD BE WITHHELD.

ALSO IN 48 COMP. GEN. 353, 355, IT WAS HELD THAT:

*** IT IS OUR VIEW THAT A PROPER APPLICATION FOR A REDUCTION IN THE AMOUNT OF AN ANNUITY OR A WITHDRAWAL FROM PARTICIPATION IN THE PLAN RECEIVED BY THE PROPER ADMINISTRATIVE AUTHORITY, MAY NOT THEREAFTER BE CHANGED OR REVOKED AND BECOMES EFFECTIVE ON "THE FIRST DAY OF THE SEVENTH CALENDAR MONTH BEGINNING AFTER HE APPLIES FOR REDUCTION OR WITHDRAWAL."

IN VIEW OF THE FOREGOING DISCUSSION, IT IS OUR VIEW THAT WHEN A REQUEST IS RECEIVED BY THE PROPER ADMINISTRATIVE AUTHORITY, FROM WHICH IT WOULD APPEAR THAT THE MEMBER HAD OVERLOOKED CERTAIN FACTORS OR INFORMATION WHICH SHOULD BE BROUGHT TO HIS ATTENTION, AND THE APPLICATION RAISES DOUBT AS TO HIS ACTUAL INTENT, SECRETARIAL APPROVAL SHOULD NOT BE GIVEN AS A MATTER OF COURSE, BUT SHOULD BE WITHHELD UNTIL THE DOUBT IS RESOLVED. IN THE EVENT THE ADMINISTRATIVE AUTHORITY INFORMS THE MEMBER THAT THE DOUBTFUL REQUEST WILL BE CONSIDERED AN APPLICATION FOR REDUCTION OR WITHDRAWAL, IT MAY NOT BE CONSIDERED A "PROPER APPLICATION" UNTIL THIS ACTION IS AFFIRMED BY THE MEMBER.

GENERAL PEATFIELD HAS EXPRESSED HIS DESIRE TO PURCHASE A REDUCED ANNUITY FOR HIS WIFE RATHER THAN WITHDRAW FROM THE PLAN AND IN THE CIRCUMSTANCES DISCLOSED WE FIND NO REASON WHY HIS LETTER OF SEPTEMBER 30, 1969, SHOULD NOT BE ACCEPTED AS A PROPER APPLICATION FOR REDUCTION OF THE AMOUNT OF THE ANNUITY UNDER 10 U.S.C. 1436(B)(1) AND PARAGRAPH 406 OF THE REGULATIONS FOR THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, DECEMBER 18, 1968.