B-49360, JULY 18, 1951, 31 COMP. GEN. 9

B-49360, JULY 18, 1951, 31 COMP. GEN. 9

LUMP-SUM PAYMENTS UNDER NAVAL AVIATION CADET ACT OF 1942 OFFICERS APPOINTED IN THE NAVAL RESERVE OR MARINE CORPS RESERVE PURSUANT TO THE PROVISIONS OF THE NAVAL AVIATION RESERVE ACT OF 1939 OR THE NAVAL AVIATION CADET ACT OF 1942 WHOSE APPOINTMENTS WERE TERMINATED FOR THE PURPOSE OF ACCEPTING COMMISSIONS IN THE REGULAR NAVY OR MARINE CORPS ARE NOT ENTITLED TO THE LUMP-SUM PAYMENT AUTHORIZED BY SECTION 12 OF THE 1942 ACT FOR AVIATION RESERVE OFFICERS RELEASED FROM ACTIVE DUTY. 25 COMP. GEN. 170, AFFIRMED.

ASSISTANT COMPTROLLER GENERAL YATES TO THE SECRETARY OF THE NAVY, JULY 18, 1951:

THERE HAS BEEN CONSIDERED YOUR LETTER OF MARCH 28, 1951, WITH ENCLOSURES, REQUESTING RECONSIDERATION OF THAT PART OF THIS OFFICE'S DECISION OF AUGUST 10, 1945, B-49360, 25 COMP. GEN. 170, WHICH HELD THAT OFFICERS WHO WERE APPOINTED IN THE NAVAL RESERVE OR IN THE MARINE CORPS RESERVE PURSUANT TO THE PROVISIONS OF THE NAVAL AVIATION RESERVE ACT OF 1939, 53 STAT. 819, OR THE NAVAL AVIATION CADET ACT OF 1942, 56 STAT. 737, AND WHOSE APPOINTMENTS WERE TERMINATED FOR THE PURPOSE OF THEIR ACCEPTING COMMISSIONS IN THE REGULAR NAVY WERE NOT ENTITLED TO THE LUMP-SUM PAYMENT AUTHORIZED BY SECTION 12 OF THE ACT OF AUGUST 4, 1942, 56 STAT. 738. ALSO YOU REFER TO DECISION OF SEPTEMBER 4, 1944, B 41115, 24 COMP. GEN. 177, IN WHICH IT WAS HELD THAT THE RELEASE OF A MARINE CORPS RESERVE OFFICER FROM ACTIVE DUTY AS A NAVAL AVIATOR COMMISSIONED PURSUANT TO THE NAVAL AVIATION RESERVE ACT OF 1939, ALTHOUGH HE IMMEDIATELY WAS ASSIGNED TO ACTIVE DUTY AS A GROUND OFFICER, CONSTITUTED A "RELEASE FROM ACTIVE DUTY" WITHIN THE CONTEMPLATION OF SECTION 12 OF THE ACT OF AUGUST 4, 1942, SUPRA, SO AS TO ENTITLE HIM TO A LUMP-SUM PAYMENT UNDER THE SAID SECTION.

IT IS STATED IN YOUR LETTER THAT THE EXPERIENCE OF THE DEPARTMENT OF THE NAVY IN THE ADMINISTRATIVE APPLICATION OF THE ABOVE DECISIONS DEMONSTRATES THAT AN INEQUITABLE DISPARITY OF TREATMENT HAS RESULTED WITH RESPECT TO THOSE OFFICERS WHOSE RESERVE APPOINTMENTS WERE TERMINATED FOR THE PURPOSE OF ACCEPTANCE OF COMMISSIONS IN THE REGULAR NAVY AS COMPARED WITH THOSE OFFICERS WHOSE APPOINTMENTS AS "NAVAL AVIATORS" WERE TERMINATED AND WHO WERE CONTINUED ON ACTIVE DUTY IN SOME OTHER STATUS AS RESERVE OFFICERS. OFFICERS FALLING IN THE SECOND CATEGORY WERE PAID THE AUTHORIZED LUMP SUM WHEREAS NO SIMILAR PAYMENT WAS AUTHORIZED FOR THOSE OFFICERS FALLING IN THE FIRST CATEGORY. ALSO, IT IS STATED THAT, IN SOME INSTANCES, RESERVE OFFICERS COMMISSIONED AS ,NAVAL AVIATORS" HAVE BEEN RELEASED FROM ACTIVE DUTY, HAVE RECEIVED LUMP-SUM PAYMENTS, AND AFTER BRIEF PERIODS OF INACTIVE DUTY, HAVE RETURNED TO DUTY UNDER COMMISSIONS IN THE REGULAR NAVY OR MARINE CORPS WITHOUT PENALTY WITH REGARDING RETIREMENT BENEFITS AND, IN SOME CASES, WITHOUT LOSS OF PRECEDENCE; AND THAT IT WOULD APPEAR THAT THE PRACTICAL EFFECT OF THE SAID DECISION OF AUGUST 10, 1945, HAS BEEN TO PENALIZE THOSE RESERVE OFFICERS "OTHERWISE ENTITLED TO THE LUMP-SUM PAYMENT WHO TRANSFERRED TO THE REGULAR NAVY OR MARINE CORPS WITHOUT ACTUAL BREAK IN CONTINUOUS ACTIVE SERVICE FOR THEIR LOYALTY IN REMAINING ON ACTIVE DUTY.' RECONSIDERATION OF THE HOLDING IN 25 COMP. GEN. 170, IS REQUESTED ON THE SPECIFIC BASIS THAT THE INEQUITIES ENCOUNTERED BY THE DEPARTMENT OF THE NAVY IN ITS APPLICATION MAY NOT HAVE BEEN CONTEMPLATED BY THIS OFFICE WHEN THE SAID DECISION WAS RENDERED, AND THAT PAYMENT OF LUMP SUM IS NOT EXPRESSLY PROHIBITED BY LAW WITH RESPECT TO THOSE RESERVE OFFICERS, OTHERWISE ELIGIBLE, WHO WERE RELEASED FROM ACTIVE DUTY FOR THE PURPOSE OF ACCEPTING APPOINTMENTS IN THE REGULAR NAVY PRIOR TO THE EFFECTIVE DATE OF THE ACT OF APRIL 28, 1950, PUBLIC LAW 485, 81ST CONGRESS, 64 STAT. 90.

IN AN ACCOMPANYING LETTER DATED APRIL 5, 1950, COMMANDER EDWARD STERNLIEB, USN, URGES THAT SINCE THE STATUTES PROVIDING LUMP-SUM PAYMENTS TO CERTAIN RESERVE OFFICERS OF THE NAVY AND OF THE MARINE CORPS AUTHORIZED SUCH PAYMENTS IN ADDITION TO ANY PAY, ALLOWANCE, COMPENSATION, OR BENEFITS WHICH SUCH OFFICERS MIGHT OTHERWISE BE ENTITLED TO RECEIVE, AND THAT SINCE THIS OFFICE HAS HELD (24 COMP. GEN. 177, SUPRA) THAT SUCH LUMP-SUM PAYMENTS ARE NOT MERE GRATUITIES OR BONUSES BUT ARE IN THE NATURE OF ADDITIONAL COMPENSATION FOR SERVICES UNDER STIPULATED CONDITIONS, IT FOLLOWS THAT THE SAID LUMP-SUMS ARE EARNED FROM DAY TO DAY AT THE PRESCRIBED RATE OF $500 PER YEAR, AND THAT SUCH A BONUS, ALREADY EARNED, SHOULD NOT BE FORFEITED BY SUBSEQUENT TRANSFER TO THE REGULAR NAVY OR MARINE CORPS.

SECTION 6 OF THE NAVAL AVIATION PERSONNEL ACT OF 1940, APPROVED AUGUST 27, 1940, 54 STAT. 865, PROVIDED, INTER ALIA, THAT OFFICERS COMMISSIONED IN THE NAVAL OR MARINE CORPS RESERVE PURSUANT TO THE NAVAL AVIATION RESERVE ACT OF 1939 SHOULD, UPON RELEASE FROM ACTIVE DUTY, BE PAID A LUMP SUM OF $500 FOR EACH COMPLETE YEAR OF ACTIVE SERVICE, OTHER THAN DUTY AS AVIATION CADETS UNDERGOING TRAINING, WITH PROPORTIONAL AMOUNTS FOR FRACTIONS OF YEARS OF SUCH SERVICE IF RELEASE WAS NOT UPON THE OFFICER'S OWN REQUEST OR AS A RESULT OF DISCIPLINARY ACTION. SUCH LUMP-SUM PAYMENTS WERE AUTHORIZED AS AN AMOUNT IN ADDITION TO ANY PAY, ETC., WHICH SUCH OFFICERS OTHERWISE MIGHT BE ENTITLED TO RECEIVE. THE ABOVE SECTION WAS REPEALED BY SECTION 15 (C) OF THE NAVAL AVIATION CADET ACT OF 1942, APPROVED AUGUST 4, 1942, 56 STAT. 739, AND THERE WAS SUBSTITUTED THEREFOR SECTION 12 OF THE LATTER ACT, 56 STAT. 738, PROVIDING, INTER ALIA, THAT OFFICERS COMMISSIONED PURSUANT TO THAT ACT OR TO THE NAVAL AVIATION RESERVE ACT OF 1939 SHOULD UPON RELEASE FROM ACTIVE DUTY, BE PAID A LUMP SUM OF $500 FOR EACH COMPLETE YEAR OF CONTINUOUS COMMISSIONED ACTIVE SERVICE WITH PROPORTIONAL AMOUNTS FOR FRACTIONS OF YEARS OF SUCH SERVICE IF RELEASE WAS NOT UPON THE OFFICER'S OWN REQUEST OR AS A RESULT OF DISCIPLINARY ACTION. LIKE THE PRIOR STATUTE SUCH LUMP-SUM PAYMENTS, ALSO, WERE TO BE IN ADDITION TO ANY PAY, ETC., WHICH SUCH OFFICERS OTHERWISE MIGHT BE ENTITLED TO RECEIVE.

IN 25 COMP. GEN. 170, SUPRA, THE PERTINENT STATUTORY PROVISIONS WERE QUOTED IN FULL AND QUOTATIONS WERE MADE FROM THE LEGISLATIVE HISTORY OF THE ACT OF AUGUST 27, 1940, SHOWING THAT IN THREE INSTANCES, NAMELY, IN THE TESTIMONY OF ADMIRAL NIMITZ BEFORE THE HOUSE COMMITTEE ON NAVAL AFFAIRS ON H.R. 10030--- WHICH BECAME THE SAID ACT--- IN THE REPORT OF THAT COMMITTEE ON THE BILL, AND IN THE REPORT OF THE SENATE COMMITTEE ON THE BILL, CLEAR AND UNEQUIVOCAL STATEMENTS WERE MADE TO THE EFFECT THAT THE BILL OFFERED ALTERNATE INDUCEMENTS FOR ACTIVE DUTY AS NAVAL AVIATORS, SUCH INDUCEMENTS BEING AN OPPORTUNITY TO ELECT THE NAVAL PROFESSION AS A CAREER, OR A SUBSTANTIAL BONUS FOR THOSE WHO DID NOT SO ELECT BUT RETURNED TO CIVILIAN PURSUITS. IT WAS ALSO NOTED THAT SUCH NAVY LEGISLATION WAS PATTERNED AFTER EARLIER ARMY LEGISLATION WHICH AUTHORIZED PAYMENT OF THE LUMP SUM ONLY TO AIR CORPS RESERVE OFFICERS NOT SELECTED FOR COMMISSION IN THE REGULAR ARMY.

IT WAS CONCLUDED IN THE SAID DECISION THAT DESPITE THE FACT THAT SECTION 6 OF THE ACT OF AUGUST 27, 1940, CONTAINED NO EXPRESS LANGUAGE TO THAT EFFECT, THE LUMP SUM AUTHORIZED THEREIN CLEARLY WAS INTENDED AS A BENEFIT ONLY TO THOSE OFFICERS COMMISSIONED IN THE NAVAL OR MARINE CORPS RESERVE PURSUANT TO THE PROVISIONS OF THE NAVAL AVIATION RESERVE ACT OF 1939, WHO WERE NOT GIVEN APPOINTMENTS IN THE REGULAR NAVY OR IN THE REGULAR MARINE CORPS UPON RELEASE FROM ACTIVE DUTY AS RESERVISTS; THAT THERE WOULD APPEAR TO BE NO BASIS ON WHICH TO ASCRIBE A DIFFERENT INTENT TO THE ESSENTIALLY SIMILAR PROVISIONS OF SECTION 12 OF THE ACT OF AUGUST 4, 1941; AND, HENCE, THAT AN INDIVIDUAL COMMISSIONED UNDER THE NAVAL AVIATION RESERVE ACT OF 1939 OR UNDER THE NAVAL AVIATION CADET ACT OF 1942, WHOSE RESERVE APPOINTMENT WAS TERMINATED FOR THE PURPOSE OF HIS ACCEPTING A COMMISSION IN THE REGULAR NAVY WAS NOT ENTITLED TO A LUMP SUM, OTHERWISE PROPERLY PAYABLE, UNDER THE STATUTES (SECTION 6 OF THE ACT OF AUGUST 27, 1940, OR SECTION 12 OF THE ACT OF AUGUST 4, 1942) IN EFFECT AT THE TERMINATION OF SUCH APPOINTMENT.

AS INDICATED ABOVE, THE QUESTION OF LUMP-SUM PAYMENTS TO INDIVIDUALS COMMISSIONED IN THE REGULAR SERVICE AFTER ACTIVE DUTY AS RESERVISTS WAS CAREFULLY CONSIDERED IN THE DECISION OF AUGUST 10, 1945. THE PURPOSE OF THAT DECISION WAS, OF COURSE, THE DETERMINATION OF THE INTENT OF THE CONGRESS IN REGARD TO THE MATTER. THE CONCLUSION REACHED WAS REQUIRED IN VIEW OF THE FACT THAT THE REPRESENTATIVE OF THE NAVY DEPARTMENT IN ADVOCATING THE LEGISLATION, AND THE TWO COMMITTEES IN THEIR REPORTS THEREON FOR THE BENEFIT OF THEIR RESPECTIVE HOUSES, ALL AGREED THAT UNDER THE CONDITIONS CONSIDERED IN THE ABOVE DECISION, LUMPS SUMS WOULD NOT BE PAYABLE. THERE COULD HARDLY HAVE BEEN A MORE DEFINITE INDICATION OF LEGISLATIVE INTENT IN THE MATTER, SHORT OF SPECIFIC LANGUAGE IN THE ACT PROHIBITING PAYMENT.

THE REQUEST FOR RECONSIDERATION SUGGESTS THAT THERE IS DISCRIMINATION BETWEEN THE CASE OF AN OFFICER COMMISSIONED IN THE REGULAR SERVICE UPON RELEASE FROM ACTIVE DUTY AS AN AVIATION RESERVIST- - WHO IS NOT PAID THE LUMP SUM--- AND THE CASE OF ANOTHER OFFICER RELEASED FROM SUCH DUTY AND CONTINUED ON ACTIVE RESERVE DUTY IN ANOTHER CATEGORY, WHO IS PAID THE BONUS. WHILE THE FIRST OFFICER DOES NOT RECEIVE THE IMMEDIATE SUBSTANTIAL MONETARY BENEFIT WHICH IS GRANTED TO THE SECOND OFFICER HE OBTAINS THE ALTERNATIVE BENEFITS OF A PROSPECTIVE LIFETIME CAREER IN THE REGULAR NAVY, WHEREAS THE SECOND OFFICER FACES THE RETURN TO HIS CIVILIAN PURSUITS IN WHICH EXPERIENCE AND OPPORTUNITY FOR ADVANCEMENT HAVE BEEN FORFEITED DURING THE PERIOD OF HIS ACTIVE NAVAL SERVICE. IT MAY BE THAT THE DECISION WAS SOMEWHAT TOO LIBERAL IN PERMITTING PAYMENT IN SUCH CASES BEFORE THE RESERVE OFFICER WAS RELEASED FROM ALL ACTIVE DUTY IN ANY RESERVE CATEGORY BUT THAT PROVIDES NO ARGUMENT FOR EXTENDING THE RULE SO AS TO PERMIT PAYMENTS TO OFFICERS RELEASED FROM ACTIVE DUTY TO ACCEPT A COMMISSION IN THE REGULAR NAVY.

AS TO THE CASE OF AN OFFICER WHO IS RELEASED FROM ACTIVE DUTY, RECEIVES A LUMP-SUM PAYMENT, AND AFTER A "BRIEF PERIOD" OF INACTIVE DUTY IS COMMISSIONED IN THE REGULAR SERVICE, THUS RECEIVING THE ADVANTAGE OF BOTH THE INDUCEMENTS WHICH WERE INTENDED BY THE CONGRESS TO BE IN THE ALTERNATIVE, THE REMEDY WOULD APPEAR TO LIE IN THE ESTABLISHMENT OF ADMINISTRATIVE PROCEDURES DESIGNED TO SAFEGUARD AGAINST SUCH A SITUATION WHERE IT IS KNOWN THAT A RESERVE OFFICER ON ACTIVE DUTY IS SHORTLY TO BE COMMISSIONED IN THE REGULAR NAVY. IN OTHER CASES, THE OFFICER HAS NO ASSURANCE UPON RELEASE FROM ACTIVE DUTY THAT HE WILL EVER BE COMMISSIONED IN THE REGULAR NAVY AND THERE IS NO LEGAL BASIS TO DENY HIM THE LUMP-SUM PAYMENT AUTHORIZED BY THE STATUTE UPON SUCH RELEASE.

AS TO THE CONTENTION THAT A LUMP SUM IS EARNED FROM DAY TO DAY AND THAT THE SUBSEQUENT DENIAL THEREOF OPERATES AS A FORFEITURE OF MONEYS ALREADY EARNED, IT SEEMS SUFFICIENT TO POINT OUT THAT THE LUMP SUM IS ONLY CONTINGENTLY "EARNED" UNTIL RELEASE FROM ACTIVE DUTY UNDER THE CONDITIONS CONTEMPLATED BY THE STATUTE, AND IF THOSE CONDITIONS ARE NOT MET THE LUMP SUM IS NOT PAYABLE AND, HENCE, IS NOT FINALLY "EARNED" IN THE SENSE OF BECOMING A VESTED RIGHT.

THE REFERENCE IN YOUR LETTER TO THE EFFECTIVE DATE OF PUBLIC LAW 485, 81ST CONGRESS, AS BEARING UPON THE PRESENT QUESTION, IS NOT UNDERSTOOD. THE SAID ACT PRESCRIBES A CUT-OFF DATE FOR SERVICE CREDIT FOR LUMP-SUM PAYMENTS, AND PROVIDES CREDIT NOT THERETOFORE ALLOWED FOR FRACTIONAL YEARS OF SERVICE IN THE CASE OF RELEASE AT THE OFFICER'S OWN REQUEST. HOWEVER, THE SAID ACT AFFECTS ONLY THE AMOUNT OF LUMP SUM WHICH MAY BE PAID IN A PARTICULAR CASE; IT DOES NOT PURPORT TO AFFECT THE REQUIREMENTS FOR ENTITLEMENT TO LUMP SUMS.

BRIEFLY, THE HOLDING IN 25 COMP. GEN. 170 WAS BASED UPON WHAT APPEARS TO BE THE CLEAR INTENT OF THE CONGRESS WHEN THE ACTS AUTHORIZING LUMP-SUM PAYMENTS WERE ENACTED. WHILE THIS OFFICE DOES NOT VIEW THE STATUTES AS INTERPRETED IN 25 COMP. GEN. 170 AND 24 COMP. GEN. 177 AS RESULTING IN INEQUITIES, IT MAY BE POINTED OUT THAT EVEN IF SUCH INEQUITIES WERE SHOWN, THAT WOULD NOT PROVIDE A SUFFICIENT BASIS FOR THIS OFFICE TO REACH A CONCLUSION CONTRARY TO WHAT IT UNDERSTANDS TO BE THE LEGISLATIVE INTENT IN THE MATTER. ALSO, THAT ANY DISPARITIES IN THIS RESPECT WHICH MAY EXIST AS BETWEEN DIFFERENT CLASSES OF NAVAL RESERVE OFFICERS UNDER THE LAW AS PRESENTLY APPLIED WOULD BE RELATIVELY INSIGNIFICANT COMPARED TO THE MAJOR DISPARITY IN FAVOR OF THE NAVY OFFICERS WHICH WOULD RESULT FROM PAYING SUCH A BONUS TO OFFICERS COMMISSIONED IN THE REGULAR NAVY WHICH IS CLEARLY DENIED OFFICERS COMMISSIONED IN THE REGULAR ARMY UNDER LIKE CIRCUMSTANCES.

I HAVE TO ADVISE, THEREFORE, THAT THIS OFFICE FINDS NO SUBSTANTIAL REASONS FOR NOW MODIFYING THE CITED DECISION, AS SUGGESTED, AND IS CONSTRAINED TO ADHERE TO THE CONCLUSION THERE REACHED WITH RESPECT TO RESERVE OFFICERS RELIEVED FROM ACTIVE DUTY TO ACCEPT A COMMISSION IN THE REGULAR NAVY.