IN THE CASE OF:	

		BOARD DATE:	       12 MARCH 2009

		DOCKET NUMBER:  AR20080012639 


THE BOARD CONSIDERED THE FOLLOWING EVIDENCE:

1.  Application for correction of military records (with supporting documents provided, if any).

2.  Military Personnel Records and advisory opinions (if any).


THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests, in effect, that his retired pay and benefits based on 20 years of qualifying service at age 60 be restored.  

2.  The applicant states that he was issued orders from his State National Guard Headquarters which assigned him to the Retired Reserve until age 60.  Section E of the additional instructions, stated that he was transferred to the Retired Reserve until age 60.  The additional instructions also stated he was authorized disability severance pay.  It was his understanding that he could be recalled to serve at any capacity.  To him this meant that he would not be discharged from the Retired Reserve until age 60.  He received notification to apply for retired pay and benefits.  At no time was he informed that if he accepted severance pay, it would make him ineligible for retired pay and benefits.  If he had known this, he would not have taken the severance pay.  He states that a person was just handed the severance pay and that was all you were told.  Different agencies indicated he was informed of his options, but he claims that this is not true.  

3.  The applicant believed that when he turned age 60, two-thirds of his retired pay would be deducted until the severance pay was recouped.  When he filed for Veterans Affairs (VA) disability benefits, the law at that time stated he could not have both.  The law changed during the Clinton administration.  The law was amended to allow him to be eligible for severance pay and retired pay if he was at least 50 percent disabled.  Based on the information he was given, he was not completely out of the military until 19 April 2007.  The letter from the Army Human Resources Command, dated 26 September 2007, mentions separation pay (SP) and severance pay (SE) and he does not understand why this would make a difference.  

4.  The applicant provides a copy of a letter from the U.S. Army Human Resources Command, St. Louis, MO (HRC-STL), dated 26 September 2007; his HRC-STL Orders P04-784128R, dated 25 September 2007; his HRC-STL Orders P04-784128, dated 6 April 2007; his Notification of Eligibility for Retired Pay at Age 60 (commonly known as the 20-Year Letter), dated 9 January 1996; and his State of North Carolina, Department of Crime Control and Public Safety, Office of The Adjutant General, Raleigh, NC, Orders 001-009, dated 2 January 1996, in support of his application.

5.  On 22 December 2008, the applicant also provided a supplemental letter in support of his application.  

CONSIDERATION OF EVIDENCE:

1.  Title 10, U.S. Code, section 1552(b), provides that applications for correction of military records must be filed within 3 years after discovery of the alleged error or injustice.  This provision of law also allows the Army Board for Correction of Military Records (ABCMR) to excuse an applicant’s failure to timely file within the 3-year statute of limitations if the ABCMR determines it would be in the interest of justice to do so.  While it appears the applicant did not file within the time frame provided in the statute of limitations, the ABCMR has elected to conduct a substantive review of this case and, only to the extent relief, if any, is granted, has determined it is in the interest of justice to excuse the applicant’s failure to timely file.  In all other respects, there are insufficient bases to waive the statute of limitations for timely filing.

2.  The applicant was born on 19 April 1947.  He was inducted into the Army of the United States (AUS) on 18 July 1968 and was released from active duty on 17 July 1970.  On the following date, he was transferred to the U.S. Army Reserve (USAR) Control Group (Annual Training).  He was discharged from the 
USAR Control Group (Standby) on 1 July 1974 at his expiration of term of service.  

3.  After a break in service, the applicant enlisted in the North Carolina Army National Guard (NCARNG) on 6 January 1978.  He was ordered to active duty in the Active Guard Reserve (AGR) program on 1 March 1985.  

4.  On 10 April 1995, a Medical Evaluation Board (MEB) referred the applicant to a Physical Evaluation Board (PEB) for diagnoses of chronic atrial fibrillation, chronic lifelong anticoagulation with Coumadin, hypertension, and bilateral sensory neural hearing loss.  

5.  On 12 June 1995, an informal PEB found the applicant unfit due to chronic atrial fibrillation (the other diagnoses were not disqualifying) and recommended he be separated with a 10 percent disability rating.  The DA Form 199 (PEB Proceedings) informed him that "The PEB considers the proper disposition to be separated with severance pay.  Ratings of less than 30% [percent] for Soldiers with less than 20 years retirement service require separation with severance pay in lieu of retirement."  On 7 July 1995, the applicant signed the PEB proceedings and did not concur with the findings of the PEB.  He subsequently requested a formal hearing of his case.

6.  On 23 August 1995, a formal PEB found the applicant unfit due to atrial fibrillation and recommended he be separated with a 10 percent disability rating.  

7.  State of North Carolina, Department of Crime Control and Public Safety, Office of The Adjutant General, Raleigh, NC, Orders 001-009, dated 2 January 1996, show the applicant was being processed for separation from the NCARNG on 24 January 1996.  The additional instructions state, in pertinent part, "You are authorized disability severance pay in pay grade E7 based on
12 years, 10 months, and 24 days of service as computed under Title 10, 
U.S. Code, section 1208."

8.  The applicant was issued a 20-Year Letter on 9 January 1996.  The 20-Year Letter stated that "This is to notify you that, having completed the required years of service, you will be eligible for retired pay upon application at age 60 in accordance with provisions of Title 10, U.S. Code, Chapter 67."

9.  State of North Carolina, Department of Crime Control and Public Safety, Office of The Adjutant General, Raleigh, NC, Orders 10-100, dated 12 January 1996, discharged the applicant from the NCARNG on 25 January 1996.  On the following date, he was transferred to the Retired Reserve.  The additional instructions state, in pertinent part, "(1) You are transferred to the Retired Reserve until you reach age 60, at which time you will be placed on the retired list and will be eligible to receive retirement pay and benefits."

10.  Department of the Army, HRC-STL, Orders P04-784128, dated 6 April 2007, show the applicant was retired and placed on the retired list on 19 April 2007 in the retired grade of sergeant first class, E-7.  The additional instructions state, in pertinent part, that he was "Authorized retired pay under Title 10, U.S. Code, section 12731." 

11.  The applicant reached age 60 on 19 April 2007.  

12.  Department of the Army, HRC-STL, Orders P04-784128R, dated 25 September 2007, revoked Orders P04-784128, dated 6 April 2007, which placed the applicant on the AUS Retired List.  

13.  In a 26 September 2007 letter, the Chief, Transition and Separations Branch, HRC-STL, notified the applicant that the office had been contacted by the Defense Finance and Accounting Service (DFAS), Cleveland, OH to discuss his DD Form 108 (Application for Retired Pay Benefits), dated 12 January 2006.  The letter indicated that the applicant was released from the NYARNG and was issued a disability retirement with a 10 percent disability rating.  He was authorized severance pay in the pay grade of SFC, E-7 based on 12 years, 10 months, and 24 days of service as computed under Title 10, U.S. Code, section 1208.  The applicant was informed that "by accepting the severance pay you severed all ties with the military."

14.  The 26 September 2007 letter from HRC-STL also indicated that the applicant had been sent an application packet for retired pay at age 60.  The retired pay packet was returned to the office (Transition and Separations Branch, HRC-STL) along with a DD Form 2656 (Data for Payment of Retired Personnel).  In Section III (Separations Payment Information) of this form, the applicant stated that he received $60,696.80 for separation pay (SP).  The applicant did not indicate this amount was severance pay (SE).  The Finance Office processed action for overpayments to recoup payments of retired pay from 19 April 2007 to current date.  His retirement orders were revoked and he was advised to destroy the Certificate of Retirement.  The letter further indicated that any benefits to which he was entitled based on his military service would come under the jurisdiction of VA and the Social Security Administration (SSA).  

15.  On 8 March 2009, the applicant informed the Board analyst that he did want his retired pay and benefits restored and that he understood that his severance pay would be recouped.

16.  Title 38, U.S. Code, sections 310 and 331, permits the VA to award compensation for a medical condition which was incurred in or aggravated by active military service.  

17.  Title 10, U.S. Code, section 1209 states that any member of the armed forces who has at least 20 years of service (for a reserve retirement) and who would be qualified for disability retirement but for the fact that his disability is less than 30 percent may elect, instead of being separated, to be transferred to the inactive status list under section 12735 of this title and, if otherwise eligible, to receive (reserve) retired pay upon becoming 60 years of age.

18.  Title 10, U.S. Code, section 1212(c) states the amount of disability severance pay received shall be deducted from any compensation for the same disability to which the former member becomes entitled under any law administered by the VA.  Thus, VA compensation may be withheld as an offset on a monthly basis until the total amount of military severance pay has been recovered.

19.  Title 10, U.S. Code, section 1213 states that, unless a person who has received disability severance pay again becomes a member of an armed   force…he is not entitled to any payment from the armed force from which he was separated for, or arising out of, his service before separation, under any law administered by one of those services or for it by another of those services.  However, this section does not prohibit the payment of money to a person who has received disability severance pay, if the money was due him on the date of his separation or if a claim by him is allowed under any law.

DISCUSSION AND CONCLUSIONS:

1.  The applicant was discharged for disability with severance pay on 25 January 1996.

2.  The applicant's contention that he was not informed regarding the options available to him of accepting severance pay or retaining his entitlement to retired pay at age 60 has been carefully considered.  It appears that there is sufficient evidence to support the applicant's claim.

3.  The evidence of record shows that the State of North Carolina published orders on 2 January 1996 which indicate the applicant was being processed for separation and that he was authorized disability severance pay.  He was then issued a 20-Year Letter prepared on 9 January 1996 and was informed of his eligibility for retired pay.  

4.  Considering the brief period of time between the issuance of the applicant's separation orders and his 20-Year Letter, it appears that he may not have been properly informed regarding the consequences of his accepting severance pay in lieu of retired pay.  



5.  The applicant is correct when he contended that he was issued orders from his State National Guard Headquarters which assigned him to the Retired Reserve until age 60 (Orders 10-100, dated 12 January 1996).  It cannot be determined if those orders were ever revoked.
 
6.  The 26 September 2007 letter from HRC-STL indicates the applicant applied for retired pay in January 2006.  According to the letter, the applicant did not indicate that the amount ($60,696.80) he had received was severance pay (SE).  As a result, the Finance Office processed action for overpayment to recoup payments of retired pay from 19 April 2007 (date he turned age 60) to the current date (September 2007).  

7.  Since it appears the applicant was not properly informed that if he accepted severance pay then he would not be eligible for retired pay, and since he understands that granting his request would require him to pay back his severance pay, it would be equitable to restore the applicant's retired pay and benefits based on 20 years of qualifying service at age 60.

BOARD VOTE:

____X____  ___X____  ___X_____  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The Board determined that the evidence presented was sufficient to warrant a recommendation for relief.  As a result, the Board recommends that all Department of the Army records of the individual concerned be corrected by:

     a.  showing that, upon completion of his formal PEB, he elected transfer to the Retired Reserve with entitlement to retired pay in lieu of severance pay and that he was in fact transferred to the Retired Reserve effective 26 January 1996;

     b.  showing he was placed on the Retired List on 19 April 2007 in the retired grade of sergeant first class, E-7; and



     c.  paying to him any and all retired pay due him as a result of the above corrections after recouping any disability severance pay paid to him.




      _______ _XXX   _______   ___
               CHAIRPERSON
      
I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case.



ABCMR Record of Proceedings (cont)                                         AR20080012639





3


ARMY BOARD FOR CORRECTION OF MILITARY RECORDS

 RECORD OF PROCEEDINGS


1

ABCMR Record of Proceedings (cont)                                         AR20080012639



6


ARMY BOARD FOR CORRECTION OF MILITARY RECORDS

 RECORD OF PROCEEDINGS


1