IN THE CASE OF:	  

		BOARD DATE:	  7 June 2012

		DOCKET NUMBER:  AR20120000030 


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, the widow of a deceased former service member (FSM), requests payment of the Survivor Benefit Plan (SBP) annuity based on her husband's death.

2.  The applicant states:

* Upon retirement in 2002, her husband elected to enroll in the SBP and named his son as a beneficiary; however, in June 2009, she and her husband changed the beneficiary to her
* In December 2009, her husband received a check from the Defense Finance and Accounting Service (DFAS) with no explanation; they learned later that DFAS had cancelled the SBP
* Her husband passed away on 27 June 2010 and she filled out the forms to claim the annuity; however, DFAS did not respond to her
* After congressional intervention, DFAS responded and mailed her a check with no explanation, which confused matters even more
* She and her husband were a couple for 7 years and lived together for
5 years; they were married on 30 June 2009 and her husband passed away on 27 June 2010
* The law stipulates that SBP coverage begins upon the first anniversary of the marriage
* Because of his untimely death - 55 hours away from 1 year - she was denied the SBP
* 
She believes DFAS mishandled the records and should have been more sympathetic to her unfortunate situation
* She should be granted the SBP benefit as her husband intended it for her
* There is no logical reason for DFAS to cancel the SBP as he was paying the premiums in good faith

3.  The applicant provides:

* Letter from a DFAS official to her Member of Congress, dated 15 August 2011
* Final Settlement of Lump Sum Death Benefit Payment
* April 2009 and June 2010 Retiree Account Statement
* Copies of DFAS check
* FSM's Certificate of Death

CONSIDERATION OF EVIDENCE:

1.  The FSM was born on 14 January 1942.

2.  He served in the U.S. Navy from 27 August 1959 to 8 January 1963 and in the U.S. Naval Reserve from 9 January 1963 to 24 February 1964.

3.  He enlisted in the Army National Guard (ARNG) on 25 February 1964 and he served through multiple extensions or reenlistments in a variety of staff or leadership positions.  He attained the rank/grade of staff sergeant (SSG)/E-6.

4.  On 3 December 1982, the National Guard Bureau issued the FSM a Notification of Eligibility for Retired Pay at Age 60, commonly known as the
"20-year letter."

5.  On 16 December 1982, he completed a DD Form 1883 (SBP Election Certificate) wherein he indicated he was married to "Linda L." and they had four dependent children.  He elected participation in the Reserve Component SBP (RCSBP) for spouse only coverage based on the full amount under Option C (Immediate coverage).  His spouse at the time concurred.

6.  He appears to have been transferred to the Retired Reserve on 6 May 1997.

7.  On 14 January 2002, he submitted an application for retired pay at age 60.  In connection with this application, on 11 December 2001, he completed a DD Form 2656 (Data for Payment of Retired Personnel) wherein he stated he was single 

and elected not to participate in the SBP.  He also designated his son, "Tony," as the beneficiary for payment of 100 percent (%) of unpaid retired pay.  He and a witness authenticated this form with their signatures.

8.  He was placed on the Retired List in his retired rank/grade of SSG/E-6 on 14 January 2002, his 60th birthday.

9.  His marriage certificate to the applicant is not available for review with this case.  However, she states, and DFAS confirmed, they were married on 30 June 2009.

10.  On 27 June 2010, the FSM died.  His Certificate of Death listed the applicant's name as the informant.

11.  His April 2009 and June 2010 Retiree Account Statements show a deduction in the amount of $33.39 for SBP costs.  Additionally, the Remarks section contains the entries "SBP Coverage Type: Spouse" and "Spouse Only Cost: $33.59." 

12.  On 15 August 2011, by letter, a DFAS official notified the applicant's Member of Congress that:

* Entitlement to retired pay terminates on the date of the retiree's death
* The Arrears of Pay (AOP) include unencumbered amounts due to the deceased member
* An amount of $752.40 was mailed to the applicant on 1 September 2010 for his AOP from 1 to 27 June 2010
* The FSM retired on 14 January 2002 and he was automatically enrolled in spouse SBP coverage due to an invalid election
* On 1 December 2009, his account was corrected to show he did not have an eligible beneficiary at retirement
* He was issued a refund in the amount of $2,282.09 for the period 17 August 2002 to 30 November 2009
* Upon his marriage to the applicant on 30 June 2009, he requested to add her as his SBP spouse beneficiary
* By law, the applicant would not have become an eligible spouse beneficiary until 30 June 2010 - the 1-year anniversary of her marriage to the FSM
* The FSM died on 27 June 2010 - the applicant was not yet an eligible SBP beneficiary

13.  Public Law 92-425, the SBP, enacted 21 September 1972, provided that military members could elect to have their retired pay reduced to provide for an annuity after death to surviving dependents.

14.  Public Law 97-252, the Uniformed Services Former Spouses Protection Act (USFSPA), dated 8 September 1982, established SBP coverage for former spouses of retiring members.  Public Law 98-94, dated 24 September 1983, established former spouse coverage for retired members (to include Reserve members).

15.  Public Law 95-397, enacted 30 September 1978, provided a way for Reserve Component members who qualified for Reserve retirement, but were not yet age 60 and eligible to participate in the SBP, to provide an annuity for their survivors should they die before reaching age 60.  Elections are made by category, not by name.  Three options were available:  

* Option A - elect to decline enrollment and choose at age 60 whether to start SBP participation
* Option B - elect that a beneficiary receive an annuity if they die before age 60, but delay payment of it until the date of the member's 60th birthday
* Option C - elect that a beneficiary receive an annuity immediately upon their death if before age 60

Once a member elects either option B or option C in any category of coverage, that election is irrevocable.  Option B and C participants do not make a new SBP election at age 60.  They cannot cancel SBP participation or change options they had in the RCSBP - the options automatically roll into SBP coverage.  

16.  DOD Financial Management Regulation, Volume 7B, Chapter 54, dated April 2012, states in paragraph 5406 (Changes in Election and Coverage): Sub-
paragraph 540601 (in the case of a later-acquired spouse and/or child), this election must be received within 1 year of the event.  Sub-paragraph 540601(b) states a member with spouse or spouse and child coverage loses the spouse beneficiary through death or divorce, the member may, upon remarriage, increase the level of coverage up to and including full retired pay, or elect not to resume spouse coverage.  If the member takes no action, spouse coverage will automatically resume upon the 1-year anniversary of the remarriage.

DISCUSSION AND CONCLUSIONS:

1.  Subsequent to receiving his 20-year letter, the FSM submitted a DD Form 1883 wherein he elected enrollment in the RSCBP, spouse coverage, under Option C.  This means in the event he died before reaching age 60, his beneficiary would have been entitled to an annuity.  The form also warned him that he was making a permanent, irrevocable decision

2.  Once a member elects either option B or option C in any category of coverage, that election is irrevocable.  Option B and C participants do not make a new SBP election at age 60.  They cannot cancel SBP participation or change options they had in RCSBP - the options automatically roll into SBP coverage.  

3.  When he was transferred to the Retired Reserve in 2002, he completed a DD Form 2656 wherein he designated his son as the beneficiary of his AOP, which is a one-time payment made to a beneficiary after a retiree's death.  The payment includes the pro-rated amount of the retiree's final month's pay and any other money owed at the time of death.  In most cases, the AOP includes the pro-rated amount of a member's final month's retirement pay.  This is because entitlement to retirement pay ends on the date of a member's death.  When death is reported, DFAS will reclaim the final month's pay and audit the retired account. The amount of the payment actually owed to the retiree will then be computed and given to the member's AOP beneficiary, the FSM's son in this case.

4.  With respect to the SBP annuity, upon remarriage, a retiree may increase the level of coverage up to and including full retired pay, or elect not to resume spouse coverage.  If the member takes no action, spouse coverage will automatically resume upon the 1-year anniversary of the remarriage.

5.  In this case, she was married to the FSM on 30 June 2009 and he died on
27 June 2010.  She provides no evidence to show she was in a legal common law marriage with the FSM.  She would not have been entitled to the SBP as an eligible beneficiary until 30 June 2010.  Regretfully, at the time of his death, she was an ineligible beneficiary.

6.  Additionally, the applicant's marriage certificate and the FSM's Certificate of Death are documents that the Army cannot correct; they are not Army records.  Accordingly, the Board is constrained as a matter of law by the 1-year period in statute.

7.  In view of the foregoing, there is an insufficient evidentiary basis for granting the applicant's requested relief.






BOARD VOTE:

________  ________  ________  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

____X____  ___X_____  ____X____  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The evidence presented does not demonstrate the existence of a probable error or injustice.  Therefore, the Board determined that the overall merits of this case are insufficient as a basis for correction of the records of the individual concerned.



      _____________X__________
               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)                                         AR20120000030



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ABCMR Record of Proceedings (cont)                                         AR20120000030



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