IN THE CASE OF:	  

		BOARD DATE:	  18 September 2014

		DOCKET NUMBER:  AR20130020846 


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, in effect, correction of her late husband's DD Form 93 (Record of Emergency Data), dated 7 March 2009, to show she was the beneficiary for the death gratuity. 

2.  The applicant states:

	a.  The DD Form 93, dated 7 March 2009, contains designations to a non-person and percentages not allowed by law or regulation, which should have invalidated all designations.  Payment should have been made 100% by law to his spouse instead of partially (40%) to spouse. 
 
	b.  She was not notified when her husband changed the DD Form 93, which also violated a court order.

	c.  The OHARNG refused to open an investigation as to why she was not notified.  

3.  The applicant provides:

* DD Forms 93, dated 7 March 2009 and 5 February 2005
* Excerpt pertaining to Title 10, U.S. Code, section 1477
* FSM's death certificate
* Motion to prevent beneficiary change
* Restraining order from Ohio court
* Entry dismissing divorce
* Military Personnel Message Number 08-167
* Acknowledgment from Ohio Army National Guard (OHARNG)

CONSIDERATION OF EVIDENCE:

1.  Having prior commissioned service in the Regular Army and U.S. Army Reserve, the applicant was appointed as a major in the OHARNG on 25 June 1994.  He was appointed as a warrant officer one on 26 June 1996.  

2.  The FSM's DD Form 93, dated 5 February 2005, shows his grandson as the beneficiary for death gratuity.  The applicant is listed as the beneficiary for his unpaid pay/allowances.

3.  He was promoted to chief warrant officer three on 28 November 2005.  

4.  His DD Form 93, dated 7 March 2009, does not show the applicant as a beneficiary for death gratuity.  The beneficiaries included his mother, sister, brother, and two organizations.

5.  On 20 October 2010, while performing an airborne operation, the FSM landed hard on the drop zone and hit his head and lost consciousness.  He died from his injuries on 24 October 2010.

6.  The applicant provides a letter from the Detailed Inspector General (IG), OHARNG, dated 5 September 2012, which states:

	a.  The OHARNG leadership chose not to initiate an investigation into why she was not notified when her husband removed her from his DD Form 93.  She clearly should have been notified; however, this had no impact or marital affect on the disbursement of the death gratuity.  

	b.  In addition, she asked that office to look into the disbursement of the FSM's death gratuity entitlement.  The Defense Finance and Accounting Service (DFAS) disbursed the death gratuity in accordance with the Department of Defense Financial Management Regulation (FMR), Volume 7A, chapter 36, paragraph 360103B of this regulation which states "If a member does not make a designation under subparagraph 360103.A, or designates only a portion of the amount payable, then the remaining amount of the death gratuity not covered by a designation will be paid as follows: 1. To the surviving spouse of the member, if any."  This statement explains why she received the initial 25%.


	c.  The Office of General Counsel (OGC), the legal arm of DFAS, ruled that the FSM did not specify the death gratuity amounts in 10% increments as required by the FMR.  Therefore, DFAS awarded her an additional 15%.  This was done to meet legal requirements while meeting the intentions of the service member.  The DFAS decision is final.  Her case was closed.      

7.  In the processing of this case, on 27 November 2013, a staff advisory opinion was obtained from the Chief, Personnel Policy Division, National Guard Bureau (NGB).  The advisory official recommends disapproval of the applicant's request.  The opinion states:

	a.  The applicant is pursuing the correction of the FSM's DD Form 93 in order to obtain $60,000.00 she believes is owed to her from the government.  This allegation is the result form the Army processing an invalid DD Form 93 which did not meet the requirements established by Federal law (Title 10, U.S. Code, section 1477).  It reads "If a Service member does not make a designation or designates only a portion of the amount payable, the amount of the death gratuity not covered by a designation shall be paid to the surviving spouse of the service member, dependent, surviving parent or appointed executor of the estate."

	b.  In 2005, the FSM filed for a divorce from the applicant.  In August 2005, the FSM obtained a court restraining order stating that neither party may change beneficiary information on their insurances.  The death gratuity benefit is an entitlement, not insurance.  The only other insurance that the military provides other than TRICARE is the Soldier's Group Life Insurance (SGLI).  Soldiers who want the SGLI have to pay for it.  Soldiers do not pay for the death gratuity because it is an entitlement.  At the time of the court order, the DD Form 93 on record was dated 5 February 2005.  The FSM signed and validated his DD Form 93 twice more after that date and prior to his death.  The first time he changed it was on 5 December 2005 and the second time on 7 March 2009.  The DD Form 93, dated 9 March 2009, removed the applicant as a beneficiary.  

	c.  According to Federal law (Title 10, U.S. Code, section 1477), she was entitled to notification of being removed.  The DD Form 93 also designated increments that were outside the 10% increments specified by law.  Validating and signing the DD Form 93 is required by the Army on an annual schedule, usually during the Soldier's birth month.

	d.  On 24 October 2010, the FSM died without the divorce being finalized.  Therefore, the applicant lawfully remained his spouse.


	e.  After the FSM's death, the applicant learned she was not listed on the current DD Form 93 as a beneficiary to receive any of the death gratuity valued at $100,000.00.  The FSM designated the disbursements in this manner:  25% to his mother, brother, and sister and 12.5% to two organizations.  According to Federal law, she is only entitled to the portion of the death gratuity not appropriately designated.  Therefore, she was only entitled to the 25% that was designated to non persons.  In November 2010, she received notification that she would receive the $25,000.00 allotted to the organizations.  She contacted DFAS about the remaining death gratuity benefit in the amount of $75,000.00.

	f.  In November 2011, the applicant filed a congressional inquiry.  Within two months she received a check for $15,000.00.  According to Federal Law, the death gratuity benefit is to be issued in increments of 10% ($10,000.00).  DFAS, when made aware of their error in distributions, rectified the situation by sending the additional 15% ($15,000.00) to the applicant.  The new distribution was: 40% ($40,000.00) to the applicant and 20% ($20,000.00) to the FSM's mother, brother, and sister.      

	g.  DFAS has twice acknowledged and paid the applicant according to the law.  She is seeking compensation for the remaining 60% ($60,000.00) of the death gratuity because she thinks she is entitled to the entire 100% ($100,000.00).  According to the facts presented, she has received compensation in the proper amounts as stipulated by Federal Law (Title 10, U.S. Code, section 1477).   

	h.  The State concurs with this recommendation.

8.  A copy of the advisory opinion was forwarded to the applicant for information and to allow her the opportunity to submit comments or a rebuttal.  She responded and stated:  

	a.  She believes the advisory opinion provides substantiation for her request to either reinstate the 2005 DD Form 93 as the final approved valid DD Form 93 or to invalidate the designations made in the 2009 DD Form 93.

	b.  The advisory opinion admits to violations of law and by its recommendation, recommends continued violation of law.

	c.  The NGB admits the Army processed an invalid DD Form 93 that does not meet the requirements established by law.  Logic would reason that when one acknowledges that a form is invalid, the manner in which to ensure compliance with law would be to recognize the last validly completed form as the form of record.  The NGB and DFAS depart from this logic and presume that by stepping into the place of her deceased husband, they can change the amount of his elections to a percentage that would be in compliance with the law.  Her position is that when the law states "only," anything outside of that is an invalid designation to be paid out by law.  The Deputy Chief of Casualty and Mortuary Affairs Branch endorses this position with an article that is posted to the Army National Guard's G1 website.   

	d.  To endorse the NGB's position would be to endorse a position that an agency (DFAS) can arbitrarily choose designations on behalf of a deceased service member (as they did by changing allocation percentages) just to achieve payment percentages that are in compliance with the law.  She argues that they have no authority to make such election percentage allocations and that allocations outside of 10 percent increments are to be treated as amounts not covered by a designation.   The law states the distribution rules; DFAS does not have authority to choose distribution percentages.
	
	e.  The death gratuity entitlement has been denied to her through misapplication of law by the NGB and DFAS.  The restraining order not only restrained each party from changing insurance, but also from changing any intangible property/benefits.  The court order was broad, it was based upon the FSM's request, and it was not exclusive to insurance.

	f.  She was denied SGLI by the FSM changing his SGLI form subsequent to the restraining order and the Army paid other parties the SGLI.

	g.  The NGB admits she was entitled by law to be notified of being removed from the form as a beneficiary, but they fail to disclose that she was not in fact notified.
 
	h.  The NGB states she was only entitled to 25% that was designated to non-persons.  They then go on to contradict their position by later stating  that DFAS rectified the situation by sending the additional 15% to the applicant at a new distribution rate of 40%.  She points out these irregularities to draw attention to the inconsistencies of the NGB and DFAS actions with respect to this situation over time.  As organizations, they have taken a cavalier approach to the matter of the violation of Federal law, only responding to the violation of the 10% increment rule when questioned as part of a congressional inquiry.

	i.  DFAS does not have the authority to choose percentage increments; the law and All Army Activities (ALARACT) Message 146/2008 are clear.  The designations that were not in compliance with the requirement are designations that are not valid and the ALARACT provides DFAS clear instruction on what to do when a Soldier fails to or only designates a portion of the amount payable.
	j.  The fact that the OHARNG concurs with the recommendation made by the NGB should bear little weight in consideration of their purpose.  It was the OHARNG that violated the law from the outset by validating an invalid DD Form 93, processing an invalid DD Form 93 to be paid out, failed to notify a spouse of her removal as a beneficiary on a DD Form 93, and chose not to investigate the matter when brought to their attention.  

9.  ALARACT Message 146/2008 states on and after 1 July 2008, Soldiers may designate from one to ten persons to receive all or a portion of the $100,000.00 death gratuity payment.  Soldiers must designate amounts payable in 10% ($10,000.00) increments.  If a Soldier fails, at any time, to make a designation or designates only a portion of the amount payable, DFAS will pay the amount of the death gratuity not covered by a designation as follows:

* To the surviving spouse of the Soldier, in any
* To any surviving children
* To the surviving parents or their survivor; or
* If none of the above exist, to the duly appointed executor or administrator of the estate, for distribution to the estate, if any

10.  Title 10, U.S. Code, section 1477(a)(1) states, on and after 1 July 2008, the designation of a person to receive a portion of the amount of death gratuity shall indicate the percentage of the amount, to be specified only in 10 percent increments, that the designated person may receive.  The balance of the amount of the death gratuity, if any, shall be paid in accordance with subsection (b).

11.  Title 10, U.S. Code, section 1477(a)(2) states if a person covered by sections 1475 or 1476 (death gratuity) has a spouse, but designates a person other than the spouse to receive all or a portion of the amount payable, the Secretary concerned shall provide notice of the designation to the spouse.

12.  Title 10, U.S. Code, section 1477(b) states if a person does not make a designation under subsection (a) or designates only a portion of the amount payable, the amount of the death gratuity not covered by the designation shall be paid to one of five categories of persons, category one being the surviving spouse, if any.

DISCUSSION AND CONCLUSIONS:

1.  The applicant requests correction of her late husband's DD Form 93, dated 
7 March 2009, to show she was the beneficiary for 100% of the death gratuity. 

2.  The evidence shows that in March 2009 the FSM executed a DD Form 93 which removed the applicant as a beneficiary for the death gratuity.  The applicant was not notified of this change.  By law, spousal notification should have been conducted.  However, the law does not state that failure to notify the spouse invalidates any other valid election.  

3.  The FSM designated 25% of the death gratuity to two organizations.  By law, organizations may not be paid the death gratuity.  The applicant is only entitled to the portion of the death gratuity not appropriately designated.  She was entitled to the 25% ($25,000.00) that was designated to the two organizations.

4.  The OGC ruled the FSM did not specify the death gratuity amounts in 10% increments as required by the FMR and therefore the applicant was awarded an additional 15% ($15,000.00).  The applicant was paid a total of $40,000.00.

5.  Failure to notify a spouse does not invalidate the DD Form 93.  The Soldier is not obligated to name a spouse.  The Army is not obligated to change the election even if the spouse was notified and disagreed.  Therefore, there is insufficient evidence on which to base granting the 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 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)                                         AR20130020846





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ABCMR Record of Proceedings (cont)                                         AR20130020846



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