RECORD OF PROCEEDINGS
AIR FORCE BOARD FOR CORRECTION OF MILITARY RECORDS

IN THE MATTER OF:			DOCKET NUMBER:  BC-2015-03767
		
 						COUNSEL:  NONE

 						HEARING DESIRED:  YES

APPLICANT REQUESTS THAT:

She be designated as the former spouse beneficiary under the Survivor Benefit Plan (SBP).  

APPLICANT CONTENDS THAT:

The SBP has her listed as the spouse beneficiary instead of former spouse beneficiary.  The Defense Finance and Accounting Service (DFAS) states the paperwork required to change her status was not completed.  The mistake may have been caused by a clerical error after their divorce.  While DFAS has indicated she is eligible for the SBP benefit according to the divorce decree, a change to the SBP beneficiary form is required.  The final dissolution of marriage clearly indicates her eligibility to continue the SBP coverage, which she elected, and the premiums were paid through deductions of her alimony portion of the decedent’s military retirement pay.  

They were married on 9 October 1987 and divorced on 22 January 1998.  He passed away on 10 October 2014 and she filed for her SBP benefits on 20 January 2015.

The applicant’s complete submission, with attachments, is at Exhibit A.

STATEMENT OF FACTS:

The former service member retired effective 1 August 1993 in the grade of colonel (O-6).  He was credited with 28 years, 10 months and 3 days of active service for basic pay.  

The parties were married on 9 October 1987.

ARPC Form 0-508, Survivor Benefit Plan Election, dated 2 June 1993, reflects the former service member elected spouse only SBP coverage based on full retired pay naming the applicant as the designated spouse beneficiary.  
The parties divorced on 22 January 1998.  The Final Judgment of Dissolution of Marriage dated 22 January 1988, issued by the Circuit Court for Okaloosa County, FL states, “If she wishes, the wife may direct the SBP be continued in her favor provided she pays for the coverage of same.”  Furthermore, the Order of Commitment from the Circuit Court for Okaloosa County, FL dated 26 October 2007, states the former service member was ordered to provide proof to his former spouse that the SBP protection was still in place and that she was the designated beneficiary.  

According to the Certificate of Death issued by the Ohio Department of Health, the former service member died on 10 October 2014.  The death certificate reflects he was divorced at the time of his death.  

The applicant provides a copy of her W-4P, Withholding Certificate for Pension or Annuity Payments, dated 20 January 2015 indicating she is single and not married.   

In a letter dated 24 February 2015, DFAS advised the applicant a divorce decree alone does not constitute a deemed election and the former service member’s record reflects he did not make a former spouse election within one year of the divorce.  Therefore, she was not eligible for the benefit.  The applicant noted the letter referenced an incorrect grade of Master Sergeant (MSgt, E-7) and that beneficiary information had been processed by DFAS.  

In a letter dated 12 June 2015, DFAS advised the applicant’s Congressman that the requirement for former spouse coverage was not met after their divorce on 22 January 1998 and that the applicant is not entitled to be the beneficiary of the former service member’s SBP coverage.  

The applicant provides a signed/notarized affidavit dated 27 October 2016 which states she is not currently married, did not marry before age 55 and that her former spouse had not remarried.  

The remaining relevant facts pertaining to this application are described in the memorandum prepared by the Air Force office of primary responsibility (OPR), which is included at Exhibit C.  

AIR FORCE EVALUATION:

DFAS-JFBEB/CL states according to law they cannot provide former spouse SBP coverage without an election from the former service member or a deemed election from the former spouse, or her attorney on her behalf, within one year from the date of the order that awarded SBP coverage.  However, if the Board should correct the record to reflect the former service member made a timely former spouse election or that the applicant timely deemed former spouse SBP, DFAS will correct the SBP election to reflect former spouse coverage for the applicant.

The SBP as outlined in 10 U.S.C. § 1447-1455, was enacted on 21 September 1972 to allow retired members of the Uniformed  Services an opportunity to provide a portion of their retired pay to their surviving beneficiaries.  Public Law 98-94 dated 24 September 1983 amended the SBP to give retirees the option to change their spouse coverage to former spouse coverage within one year of divorce.  Public law 98-525 enacted on 19 October 1984 further amended the SBP by giving the former spouse of a retiree an option to request that a former spouse election be deemed to have been made by the retiree.  There are two requirements for a deemed election to be valid.  The first is that the divorce decree must clearly indicate the former spouse is entitled to coverage under the SBP.  The second is the request must be received within one year of the divorce.  In this case, the divorce decree indicates benefits; however, DFAS records do not reflect receipt of the former spouse election from the former service member nor was a deemed election from the applicant received within one year of the divorce.  Both requirements must be met in order to be the eligible SBP beneficiary.  Therefore, she is not entitled as the former spouse beneficiary.  

The former service member did fax a copy of the divorce decree to DFAS on 18 February 1998.  However, due to incorrect processing, the SBP was never suspended and premiums for SBP spouse costs continued to be withheld from his retired pay.  Another fax was received from the former service member on 13 December 1998.  However, SBP spouse premiums continued to be withheld from his monthly retired pay from 1 August 1993 (his retirement) through his death on 10 October 2014.  As a result, the former service member’s Retiree Account Statement reflects the applicant as “spouse” not “former spouse” based on his original election of spouse coverage never being changed.   The former service member designated his children to receive the Arrears of Pay (AOP) and the former service member was divorced (and not remarried) at the time of his death.  As a result, there is no competing claim for the former service member’s SBP annuity entitlement.  To date, the SBP spouse premiums have not been refunded and the AOP has not been paid.  
 
A complete copy of the DFAS-JFBEB/CL evaluation is at Exhibit C.

APPLICANT'S REVIEW OF AIR FORCE EVALUATION:

The former service member was court ordered to maintain the SBP for her and the premiums were deducted from the alimony he paid to her.  Status reports from DFAS provided to her by the former service member following their divorce indicated the insurance contract was in good standing.

DFAS treated the faxed documentation dated 18 February 1998 from the former service member as a de facto notification for change of spouse status to “former spouse” as DFAS continued to collect the premiums.  Additionally, the faxed document from the former service member dated 22 December 1998 states, “please make any changes necessary;” inference she is now the former spouse.  This was within the one year notification period following their divorce as required by law.  DFAS would have had no reason for continued collection of the premiums if they did not consider her to have appropriate former spouse status since there would not have been any beneficiary and no justification for collection of premiums through the date of his death.  

DFAS has not refunded or offered to refund the premiums paid, an acknowledgement of its equitable obligation to provide her the SBP annuity.  The facts in this case warrant a deemed proper election for former spouse benefits was made per the faxed documents dated 18 February and 13 December 1998.  The Board should correct the record to reflect the former service member made a timely election as required by law to change the beneficiary from spouse to former spouse.

She requests the Board consider the following:  (1) All premiums were paid for the SBP, (2) She relied on reports from DFAS provided by the decedent that the SBP was in-place, (3) DFAS was adequately informed by the former service member that she was the former spouse SBP beneficiary and (4) Premiums for the SBP continued to be collected after the notification of divorce, inferring she as the former spouse was the beneficiary.

A complete copy of the applicant’s complete submission, with attachments, is at Exhibit F.  

THE BOARD CONCLUDES THAT:

1.  The applicant has exhausted all remedies provided by existing law or regulations.

2.  The application was timely filed.

3.  Insufficient relevant evidence has been presented to demonstrate the existence of an error or injustice.   The applicant contends in her rebuttal response that the former service member’s faxed documents to DFAS on 18 February and 13 December 1998 changing his marital status is evidence he elected former spouse SBP coverage within one year following their divorce as required by law; however, we disagree.  In this respect, while the former service member faxed information to DFAS stating he had divorced, there is no evidence to substantiate he requested a change of his SBP election from spouse to former spouse.  We do not know why DFAS continued to deduct the costs for the SBP premiums; however, we find the documentation provided insufficient to find the former service member or the applicant deemed a former spouse SBP election within one year following their divorce as required by law.  Furthermore, the applicant has not demonstrated that extraordinary circumstances exist that are required for this Board to grant relief in cases of competing interests.  In this respect, we note the DFAS evaluation states that the former service member designated his children to receive the AOP and his daughter is listed on the death certificate.  Although there appears to not be a competing claim for the SBP annuity, we have been advised by our Agency Legal Counsel that in these types of cases a potential exists for competing interests based on the AOP beneficiary.  In cases involving potential competing interests, this Board has been advised not to consider such cases unless a court of competent jurisdiction has ruled in the case or remands the case to the Board to make a determination.  Therefore, we are precluded from granting the applicant the SBP benefit.  However, if the former service member’s heir(s) were to provide a notarized consent relinquishing the benefit, or complete the Survivor Benefit Program – Release of Arrears of Pay (AOP) affidavit, we would be willing to reconsider the applicant’s request.  Otherwise, the applicant’s only recourse is to return to a court of competent jurisdiction to have the issue decided.  Therefore, in the absence of evidence to the contrary, we find no basis to recommend granting the requested relief.

4.  The applicant’s case is adequately documented and it has not been shown that a personal appearance with or without counsel will materially add to our understanding of the issues involved.  Therefore, the request for a hearing is not favorably considered.

THE BOARD DETERMINES THAT:

The applicant be notified the evidence presented did not demonstrate the existence of material error or injustice; the application was denied without a personal appearance; and the application will only be reconsidered upon the submission of newly discovered relevant evidence not considered with this application.

The following members of the Board considered AFBCMR Docket Number BC-2015-03767 in Executive Session on 4 and 22 November 2016 under the provisions of AFI 36-2603:

	 , Panel Chair
	 , Member
	 , Member

The following documentary evidence pertaining to AFBCMR Docket Number BC-2015-03767 was considered:

	Exhibit A.  DD Form 149, dated 26 August 2015, w/atchs.
	Exhibit B.  Applicant's Master Personnel Records.
	Exhibit C.  Memorandum, DFAS-JFBEB/CL, dated 8 September
			  2016, w/atchs.
	Exhibit D.  Letter, AFBCMR, dated 12 October 2016.
	Exhibit E.  Letter, AFBCMR dated 26 October 2016, w/atch.
	Exhibit F.  Letter, Applicant, dated 26 October 2016, 
			  w/atchs.
	Exhibit G.  Affidavit, Applicant, dated 27 October 2016.

Pursuant to paragraph 1 of AFI 36-2603 (Title 32 Code of Federal Regulations, Part 865.1), it is certified that a quorum was present at the Board's review and deliberations, and that the foregoing is a true and complete record of the Board's proceedings in the above entitled matter.