B-136111, JULY 7, 1958, 38 COMP. GEN. 10

B-136111, JULY 7, 1958, 38 COMP. GEN. 10

MILITARY PERSONNEL - RETIRED PAY - SERVICE CREDITS - INACTIVE SERVICE - INITIAL GRANT OF RETIRED PAY THE PROHIBITION IN SUBSECTION 202 (B) OF THE CAREER COMPENSATION ACT OF 1949, 37 U.S.C. 233 (B), AGAINST THE CREDIT OF INACTIVE RETIRED SERVICE FOR THE PURPOSE OF INCREASING RETIRED PAY WHILE ON THE RETIRED LIST IS INAPPLICABLE TO THE INITIAL GRANT OF RETIRED PAY WHICH IS EXPRESSLY AUTHORIZED BY LAW, AND THEREFORE, A RESERVE OFFICER WHO HAS SERVED ON THE HONORARY RETIRED LIST AND WHO IS SERVING ON THE RETIRED RESERVE LIST AT THE TIME HE IS GRANTED RETIRED PAY MAY HAVE THE INACTIVE RETIRED SERVICE CREDITED FOR BASIC PAY PURPOSES IN THE COMPUTATION OF ACTIVE DUTY PAY ON WHICH RETIRED PAY UNDER 10 U.S.C. 1401 IS BASED.

TO R. A. WILSON, DEPARTMENT OF THE NAVY, JULY 7, 1958:

REFERENCE IS MADE TO YOUR LETTER OF APRIL 2, 1958, XR:PH/HA:HM L16-4 (1) ( JAG:1342:2:SH 3939/--- ASSIGNED SUBMISSION NO. 341 BY THE MILITARY PAY AND ALLOWANCE COMMITTEE, DEPARTMENT OF DEFENSE--- REQUESTING A DECISION AS TO THE PROPER RATE OF BASIC PAY TO BE USED IN COMPUTING THE RETIRED PAY OF AN INDIVIDUAL GRANTED RETIRED PAY UNDER CHAPTER 67, TITLE 10, U.S.C. WHEN THE INDIVIDUAL CONCERNED HAS SERVED ON THE HONORARY RETIRED LIST AND IS SERVING ON THE RETIRED RESERVE LIST AT THE TIME HE IS GRANTED SUCH RETIRED PAY. YOU CITE THE CASE OF CAPTAIN PIERSON P. BROWN, SC, USNR, RETIRED, AS ILLUSTRATIVE OF THE QUESTION INVOLVED.

YOU SAY THAT CAPTAIN BROWN WAS GRANTED RETIRED PAY FEBRUARY 1, 1958, UNDER THE PROVISIONS OF CHAPTER 67, AT WHICH TIME HE HAD COMPLETED 21 YEARS, 3 MONTHS AND 23 DAYS OF SERVICE CREDITABLE FOR BASIC PAY PURPOSES EXCLUSIVE OF 11 YEARS, 8 MONTHS AND 28 DAYS OF INACTIVE SERVICE ON THE HONORARY RETIRED LIST CREATED BY SECTION 309 OF THE NAVAL RESERVE ACT OF 1938, 52 STAT. 1183, AND ON THE RESERVE RETIRED LIST ESTABLISHED PURSUANT TO THE ARMED FORCES RESERVE ACT OF 1952, 66 STAT. 481, 50 U.S.C. 901. YOU REPORT THAT HIS RETIRED PAY HAS BEEN COMPUTED ON THE BASIC PAY AUTHORIZED FOR A CAPTAIN WITH OVER 18 YEARS BUT LESS THAN 22 YEARS OF SERVICE FOR BASIC PAY PURPOSES. THE BASIS FOR SUCH ACTION APPEARS TO BE A PROVISO CONTAINED IN SUBSECTION 202 (B) OF THE CAREER COMPENSATION ACT OF 1949, 63 STAT. 808, 37 U.S.C. 233 (B), TO THE EFFECT THAT INACTIVE SERVICE ON A RETIRED LIST MAY NOT BE INCLUDED TO INCREASE RETIRED PAY WHILE ON A RETIRED LIST.

CHAPTER 67, TITLE 10 OF THE U.S.C. (SECTIONS 1331-1337), IS A CODIFICATION OF THE RESERVE RETIREMENT PROVISIONS OF TITLE III OF THE ACT OF JUNE 29, 1948, 62 STAT. 1087, EXCLUSIVE OF THOSE PROVISIONS RELATING TO THE COMPUTATION OF RETIRED PAY WHICH ARE RESTATED IN 10 U.S.C. 1401, FORMULA NO. 3. SECTIONS 1332 AND 1333 OF TITLE 10 CONTAIN PROVISIONS RELATING TO COMPUTING YEARS OF SERVICE FOR PURPOSES OF QUALIFYING FOR RETIRED PAY UNDER CHAPTER 67 AND DETERMINING THE PERCENTAGE MULTIPLE FOR PURPOSES OF COMPUTING SUCH RETIRED PAY. SECTION 1334 BARS THE COUNTING OF SERVICE IN AN INACTIVE STATUS AND TIME SPENT AFTER RETIREMENT OR TRANSFER TO THE RETIRED RESERVE IN THE COMPUTATION OF "YEARS OF SERVICE UNDER THIS CHAPTER.' SUCH "YEARS OF SERVICE" APPEAR TO BE THOSE WHICH RELATE TO QUALIFYING FOR RETIRED PAY AND THOSE WHICH ARE USED IN DETERMINING THE PERCENTAGE MULTIPLE FOR PURPOSES OF COMPUTING SUCH RETIRED PAY UNDER CHAPTER 67. FORMULA NO. 3 OF SECTION 1401 IS A SEPARATE STATUTORY PROVISION AND NOTHING HAS BEEN FOUND IN EITHER CHAPTER 67, IN ITS LEGISLATIVE HISTORY, OR IN THE STATUTORY PROVISIONS FROM WHICH SECTION 1334 WAS DERIVED (SECTIONS 304 AND 308 OF THE 1948 ACT AND SECTION 211 (B) OF THE ARMED FORCES RESERVE ACT OF 1952, 66 STAT. 485) WHICH INDICATES, IN ANY WAY, THAT SECTION 1334 WAS INTENDED TO BE A LIMITATION ON ANY RIGHTS GRANTED UNDER FORMULA NO. 3. UNDER SECTION 202 (B) OF THE CAREER COMPENSATION ACT OF 1949, SERVICE ON A RETIRED LIST, INCLUDING IN COMPUTING ACTIVE-DUTY PAY AND UNDER FORMULA NO. 3 OF SECTION 1401, THE RETIRED PAY OF PERSONS GRANTED SUCH PAY UNDER THE PROVISIONS OF CHAPTER 67 IS FOR COMPUTATION ON MONTHLY BASIC PAY. COMPARE B-135426, MAY 5, 1958, 37 COMP. GEN. 728.

SINCE THIS CASE DOES NOT INVOLVE ANY INCREASE IN CAPTAIN BROWN'S RETIRED PAY ON THE HONORARY RETIRED LIST OR THE RESERVE RETIRED LIST BUT CONCERNS AN INITIAL GRANT OF RETIRED PAY WHICH IS EXPRESSLY AUTHORIZED BY LAW IN THE SITUATION PRESENTED, THE PROVISO OF SUBSECTION 202 (B) OF THE CAREER COMPENSATION ACT, PROHIBITING THE CREDIT OF INACTIVE RETIRED SERVICE FOR THE PURPOSE OF INCREASING RETIRED PAY WHILE ON A RETIRED LIST, IS NOT FOR APPLICATION. COMPARE 36 COMP. GEN. 431, 433.

UNDER THE PROVISION OF 10 U.S.C. 1401, FORMULA NO. 3, THE MONTHLY RETIRED PAY OF A PERSON ENTITLED TO SUCH PAY UNDER THE PROVISIONS OF CHAPTER 67 IS COMPUTED BY MULTIPLYING THE MONTHLY BASIC PAY, APPLICABLE ON THE DATE WHEN RETIRED PAY IS GRANTED, OF THE HIGHEST GRADE HELD SATISFACTORILY BY THE PERSON CONCERNED AT ANY TIME IN THE ARMED FORCES BY 2 1/2 PERCENT FOR EACH OF THE YEARS OF SERVICE CREDITED TO HIM UNDER 10 U.S.C. 1333, NOT TO EXCEED 75 PERCENT OF THE BASIC PAY UPON WHICH THE COMPUTATION IS BASED. ASSUMING THAT THE HIGHEST GRADE HELD BY CAPTAIN BROWN IS THAT OF CAPTAIN, HIS RETIRED PAY IS FOR COMPUTATION ON THE BASIC PAY AUTHORIZED ON FEBRUARY 1, 1958, THE DATE HE WAS GRANTED SUCH RETIRED PAY, FOR A CAPTAIN WITH OVER 30 YEARS OF SERVICE, PLUS SUCH INCREASE AS IS AUTHORIZED, EFFECTIVE JUNE 1, 1958, BY SECTION 4 (A) OF THE ACT OF MAY 20, 1958, 72 STAT. 128, 37 U.S.C. 232 (D) (A).