B-158035, DEC. 7, 1966

B-158035, DEC. 7, 1966

TO LIEUTENANT WILLIAM C. SELLS, USN, RETIRED:

REFERENCE IS MADE TO YOUR CLAIM FOR INCREASED RETIRED PAY--- FORWARDED HERE BY THE RETIRED PAY DEPARTMENT, U.S. NAVY FINANCE CENTER,CLEVELAND, OHIO--- BASED ON 25 YEARS' SERVICE FOR PERCENTAGE MULTIPLE PURPOSES UNDER SECTION 516 OF THE CAREER COMPENSATION ACT OF 1949, RATHER THAN 24 YEARS' SERVICE AS COMPUTED IN OUR CLAIMS DIVISION SETTLEMENT OF FEBRUARY 17, 1966.

YOU SAY THAT YOU COMPLETED 9 MONTHS AND 21 DAYS' INACTIVE SERVICE IN THE NAVAL RESERVE FORCE, AND THAT THE SETTLEMENT DID NOT INCLUDE THIS SERVICE IN DETERMINING YEARS OF SERVICE FOR PERCENTAGE MULTIPLE PURPOSES. SINCE THIS MATTER WAS THE SUBJECT OF OUR DECISION OF JANUARY 10, 1966, B-158035, YOUR CLAIM WILL BE CONSIDERED AS A REQUEST FOR RECONSIDERATION OF THAT DECISION.

IN OUR DECISION OF JANUARY 10, 1966, TO YOUR ATTORNEY, MR. FRED W. SHIELDS, WE POINTED OUT THAT THE RECORD FURNISHED US BY THE BUREAU OF NAVAL PERSONNEL SHOWED THAT WHEN YOU TRANSFERRED TO THE FLEET RESERVE ON FEBRUARY 25, 1946, YOU WERE CREDITED WITH 21 YEARS, 4 MONTHS AND 19 DAYS OF SERVICE FOR PAY PURPOSES AND 21 YEARS, 8 MONTHS AND 1 DAY OF SERVICE FOR TRANSFER PURPOSES, INCLUDING 1 YEAR, 1 MONTH AND 3 DAYS OF CONSTRUCTIVE SERVICE. YOU SERVED ON ACTIVE DUTY FROM FEBRUARY 6, 1951, TO MARCH 5, 1953, A PERIOD OF 2 YEARS AND 1 MONTH, WHICH, WHEN ADDED TO THE 21 YEARS, 8 MONTHS AND 1 DAY OF SERVICE CREDITED TO YOU FOR TRANSFER PURPOSES, TOTALS 23 YEARS, 9 MONTHS AND 1 DAY. THE RECORD ALSO SHOWS THAT YOU HAD INACTIVE SERVICE IN THE NAVAL RESERVE FORCE DURING THE PERIOD DECEMBER 13, 1927, TO OCTOBER 3, 1928, A TOTAL OF 9 MONTHS AND 21 DAYS.

IN LINE WITH THE HOLDING OF THE COURT OF CLAIMS IN THE CASE OF CALLAHAN V. UNITED STATES, 164 CT.CL. 606 (1964), WE SAID IN OUR DECISION OF JANUARY 10, 1966, THAT WHERE THE YEARS OF SERVICE CREDITED TO AN ENLISTED MAN AT THE TIME OF HIS TRANSFER TO THE FLEET RESERVE INCLUDED SUCH PERIODS OF CONSTRUCTIVE SERVICE, THIS WAS THE BASE TO WHICH ACTIVE SERVICE PERFORMED AFTER TRANSFER SHOULD BE ADDED IN ORDER TO OBTAIN A NEW MULTIPLIER FACTOR UNDER SECTION 516 OF THE CAREER COMPENSATION ACT OF 1949, CH. 681, 63 STAT. 832. ON SUCH BASIS, WE CONCLUDED THAT YOU HAD COMPLETED 23 YEARS, 9 MONTHS AND 1 DAY OF SERVICE (COUNTED AS 24 YEARS) FOR PURPOSES OF DETERMINING THE MULTIPLIER FACTOR TO BE USED IN COMPUTING YOUR RETIRED PAY UNDER SECTION 516 OF THE 1949 ACT.

AS INDICATED IN YOUR CLAIM, AT THE TIME OF YOUR TRANSFER TO THE FLEET RESERVE YOU HAD TO YOUR CREDIT 21 YEARS, 8 MONTHS AND 1 DAY OF SERVICE, INCLUDING CONSTRUCTIVE SERVICE, FOR TRANSFER PURPOSES, PLUS 9 MONTHS AND 21 DAYS' INACTIVE SERVICE IN THE NAVAL RESERVE FORCE, OR A TOTAL OF 22 YEARS, 5 MONTHS AND 22 DAYS. YOU STATE THAT THE PERCENTAGE FACTOR IN COMPUTING YOUR RETAINER PAY AT THE TIME OF YOUR TRANSFER WAS NOT BASED ON LENGTH OF SERVICE BUT WAS NOT ESTABLISHED AT ONE-HALF BASE PAY BY SECTION 203 OF THE NAVAL RESERVE ACT OF 1938, CH. 690, 52 STAT. 1178. YOU REFER TO OUR DECISION REPORTED AT 31 COMP. GEN. 547 (ANSWER TO QUESTION 3), AND SAY THAT THE ADDITIONAL ACTIVE DUTY AFTER TRANSFER OF 2 YEARS AND 1 MONTH, WHEN ADDED TO THE 22 YEARS, 5 MONTHS AND 22 DAYS, TOTALS 24 YEARS, 6 MONTHS AND 22 DAYS, TO BE COUNTED AS 25 YEARS FOR PERCENTAGE MULTIPLE PURPOSES UNDER SECTION 516 OF THE 1949 ACT.

IN PERTINENT PART, SECTION 516 OF THE 1949 ACT PROVIDED THAT THE RETIRED PAY OR RETAINER PAY TO WHICH A MEMBER, OR FORMER MEMBER, SHALL BE ENTITLED UPON RELEASE FROM A PERIOD OF SUBSEQUENT ACTIVE DUTY---

"SHALL BE COMPUTED BY MULTIPLYING THE YEARS OF SERVICE CREDITABLE TO HIM FOR PURPOSES OF COMPUTING RETIRED PAY * * * RETAINER PAY * * * AT THE TIME OF HIS RETIREMENT OR TRANSFER PLUS THE NUMBER OF YEARS OF SUBSEQUENT ACTIVE DUTY PERFORMED BY HIM BY 2 1/2 PERCENTUM, AND BY MULTIPLYING THE PRODUCT THUS OBTAINED BY THE BASE AND LONGEVITY PAY OR THE BASIC PAY, AS THE CASE MAY BE, OF THE RANK OR GRADE IN WHICH HE WOULD BE ELIGIBLE, AT THE TIME OF HIS RELEASE FROM ACTIVE DUTY, TO BE RETIRED OR TRANSFERRED EXCEPT FOR THE FACT THAT HE IS ALREADY A RETIRED PERSON OR A MEMBER OF A FLEET RESERVE OR FLEET MARINE CORPS RESERVE.'

IN 31 COMP. GEN. 547, IN ANSWER TO QUESTION 3, THE DECISION ON WHICH YOU RELY, THERE WAS INVOLVED AN OFFICER WHO WAS RETIRED ON ACCOUNT OF PHYSICAL DISABILITY PRIOR TO OCTOBER 1, 1949, THE EFFECTIVE DATE OF THE CAREER COMPENSATION ACT OF 1949, AND WHO WAS ENTITLED UNDER THE LAW IN EFFECT AT THAT TIME TO HAVE HIS RETIRED PAY COMPUTED AT THE RATE OF 75 PERCENT OF THE ACTIVE DUTY PAY OF OF THE RANK HE HELD AT THE TIME OF RETIREMENT. SUBSEQUENT TO OCTOBER 1, 1949, THE OFFICER SERVED ON ACTIVE DUTY AND THEREAFTER HE WAS RELEASED AND RETURNED TO THE RETIRED LIST. SINCE THE OFFICER COULD COUNT HIS MIDSHIPMAN SERVICE FOR LONGEVITY PAY PURPOSES IN THE COMPUTATION OF HIS BASE PAY AT THE TIME OF HIS INITIAL RETIREMENT, THE QUESTION INVOLVED WAS WHETHER HE WOULD BE ENTITLED TO SUCH CREDIT IN DETERMINING THE PERCENTAGE FACTOR UNDER SECTION 516 OF THE 1949 ACT. ANSWERING THAT QUESTION IN THE AFFIRMATIVE, IT WAS STATED THAT SINCE THE ONLY SERVICE WHICH AFFECTED THE ORIGINAL COMPUTATION OF HIS RETIRED PAY WAS THE SERVICE CREDITABLE FOR LONGEVITY PAY PURPOSES, THERE WAS NO ALTERNATIVE BUT TO LOOK TO THAT SERVICE IN DETERMINING THE PERCENTAGE FACTOR TO BE USED IN COMPUTING HIS RETIRED PAY UNDER SECTION 516 OF THE 1949 ACT.

THIS DECISION, HOWEVER, AFFORDS NO BASIS FOR CONCLUDING THAT IN DETERMINING THE PERCENTAGE FACTOR UNDER THE PROVISIONS OF SECTION 516, IN THE CASE OF AN ENLISTED MAN TRANSFERRED TO THE FLEET RESERVE UNDER SECTION 203 OF THE NAVAL RESERVE ACT OF 1938, INACTIVE SERVICE IN THE NAVAL RESERVE FORCE, WHICH IS CREDITABLE FOR LONGEVITY PAY PURPOSES BUT WHICH IS NOT CREDITABLE UNDER APPLICABLE LAW FOR TRANSFER PURPOSES, MAY BE USED FOR PERCENTAGE MULTIPLE PURPOSES.

IT LONG HAS BEEN HELD THAT "INACTIVE DUTY IN THE NAVAL RESERVE FORCE CANNOT BE COUNTED AS SERVICE FOR TRANSFER TO THE FLEET NAVAL RESERVE UNDER ACT OF JULY 1, 1922 (42 STAT. 799-800).' SEE NOTE 17, PAGE 960, LAWS RELATING TO THE NAVY, ANNOTATED, SUPPLEMENT 1929 (MELLING), AND AUTHORITIES THERE CITED. SEE, ALSO, 5 COMP. GEN. 189. THIS PROHIBITION HAS BEEN CONTINUED AND CARRIED FORWARD IN ARTICLE H 9407 (2) (B), BUREAU OF NAVAL PERSONNEL MANUAL, 1942, AND IN ARTICLE H 9408 (2) (B) OF THE 1948 MANUAL PROVIDING THAT IN COMPUTING THE SERVICE OF ENLISTED MEN OF THE NAVY FOR TRANSFER TO THE FLEET RESERVE, DEDUCTIONS WILL BE MADE FOR INACTIVE SERVICE AS A MEMBER OF THE FLEET RESERVE, DEDUCTIONS WILL BE MADE FOR INACTIVE SERVICE AS A MEMBER OF THE NAVY (INCLUDING, AS LISTED IN THE 1942 MANUAL, THE NAVAL RESERVE FORCE). SEE ALSO ARTICLE C-13404 (1), CURRENTLY IN EFFECT.

THE CONCLUSION REACHED IN 31 COMP. GEN. 547 WAS BASED ON THE FACT THAT THERE WAS NO OTHER ALTERNATIVE TO THE USE OF SERVICE CREDITABLE FOR LONGEVITY PAY PURPOSES IN COMPUTING A RETIRED PAY INCREASE UNDER SECTION 516 IN THE CIRCUMSTANCES THERE INVOLVED, SINCE THE 75 PERCENT RATE AT WHICH DISABILITY RETIRED PAY WAS THEN PAYABLE HAD NO RELATIONSHIP TO THE YEARS OF SERVICE THE MEMBER CONCERNED HAD SERVED PRIOR TO HIS RETIREMENT. IN THE PRESENT CASE, THERE IS AN ALTERNATIVE, NAMELY, THE YEARS OF SERVICE CREDITABLE FOR THE PURPOSES OF TRANSFER TO THE FLEET RESERVE AND SUCH YEARS OF SERVICE (20 OR MORE) HAVE A DIRECT RELATIONSHIP TO A MEMBER'S RIGHT TO RETAINER OR RETIRED PAY AT THE RATE OF ONE-HALF OF HIS ACTIVE DUTY PAY. IT SHOULD BE NOTED ALSO, IN THIS CONNECTION, THAT THE COMPUTATION OF RETAINER PAY BY THE PERCENTAGE METHOD AUTHORIZED BY SECTION 204 OF THE NAVAL RESERVE ACT OF 1938, AS AMENDED BY SECTION 2 OF THE ACT OF AUGUST 10, 1946, CH. 952, 60 STAT. 993 (CURRENTLY CONTAINED IN 10 U.S.C. 6330), WAS BASED ON THE NUMBER OF YEARS OF "ACTIVE" SERVICE. THE CIRCUMSTANCES, WE SEE NO BASIS FOR THE CONCLUSION THAT IN ENACTING SECTION 516 THE CONGRESS INTENDED THAT INACTIVE SERVICE IN THE NAVAL RESERVE FORCE IN A CASE SUCH AS YOURS SHOULD BE COUNTED IN DETERMINING THE PERCENTAGE FACTOR FOR AN INCREASE IN RETAINER OR RETIRED PAY.

SINCE THE CREDITING OF INACTIVE NAVAL RESERVE FORCE SERVICE FOR TRANSFER PURPOSES TO THE FLEET RESERVE IS NOT PROPER, THE ONLY SERVICE CREDITABLE IN YOUR CASE FOR THE PURPOSE OF DETERMINING THE MULTIPLIER FACTOR IN COMPUTING YOUR RETAINER OR RETIRED PAY UNDER SECTION 516 OF THE 1949 ACT, WAS THE ACTIVE AND CONSTRUCTIVE SERVICE CREDITABLE TO YOU AT THE TIME OF TRANSFER PLUS YOUR ACTIVE DUTY SERVICE AFTER TRANSFER. AS STATED IN OUR DECISION OF JANUARY 10, 1966, THIS SERVICE TOTALED 23 YEARS, 9 MONTHS AND 1 DAY, OR A MULTIPLIER FACTOR OF 24 YEARS OF SERVICE.

EVEN IF THE COUNTING OF INACTIVE NAVAL RESERVE FORCE SERVICE WERE PERMISSIBLE THERE WOULD BE NO BASIS FOR INCREASING THE MULTIPLIER FACTOR IN YOUR CASE FROM 24 TO 25 YEARS OF SERVICE. BY INCLUDING YOUR INACTIVE SERVICE, YOUR TOTAL SERVICE WOULD BE 24 YEARS, 6 MONTHS AND 22 DAYS (COUNTED AS 25 YEARS). HOWEVER, IN A LETTER TO US DATED NOVEMBER 3, 1961, THE BUREAU OF NAVAL PERSONNEL, WITH RESPECT TO YOUR NAVAL HISTORY, REPORTED THAT YOU WERE AWOL (ABSENCE WITHOUT LEAVE) FROM FEBRUARY 23 TO APRIL 18, 1925, A PERIOD OF 56 DAYS. SINCE ABSENCE WITHOUT LEAVE DOES NOT CONSTITUTE SERVICE FOR TRANSFER PURPOSES TO THE NAVAL RESERVE (5 COMP. GEN. 189), THIS TIME (1 MONTH AND 26 DAYS) NECESSARILY WOULD BE REQUIRED TO BE DEDUCTED FROM THE 24 YEARS, 6 MONTHS AND 22 DAYS, LEAVING A TOTAL SERVICE OF 24 YEARS, 4 MONTHS AND 7 DAYS. SINCE 4 MONTHS AND 7 DAYS ARE LESS THAN ONE-HALF OF A YEAR, THE MULTIPLIER FACTOR WOULD BE 24 YEARS.

ACCORDINGLY, THE METHOD USED IN COMPUTING YOUR RETIRED PAY AS SET FORTH IN OUR DECISION OF JANUARY 10, 1966, WAS PROPER AND THAT DECISION IS SUSTAINED.