PROCEEDINGS

	IN THE CASE OF:       

	BOARD DATE:           29 March 2000                  
	DOCKET NUMBER:   AR1999028367

	I certify that hereinafter is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in the case of the above-named individual.  

	Mr. Kenneth H. Aucock		Analyst	

  The following members, a quorum, were present:

	Mr. Robert G. Hinkle		Chairperson	
	Mr. Mark D. Manning		Member	
	Mr. James P. Steuve		Member	

	The applicant and counsel if any, did not appear before the Board.

	The Board considered the following evidence:

	Exhibit A - Application for correction of military 
                records
	Exhibit B - Military Personnel Records (including
	            advisory opinion, if any)

FINDINGS:

1.  The applicant has exhausted or the Board has waived the requirement for exhaustion of all administrative remedies afforded by existing law or regulations.

2.  The applicant is the former spouse of a deceased former service member (FSM), and requests annuities under the survivor benefit plan (SBP).   

3.  The applicant states that neither she nor the deceased FSM was aware of the deemed election form.  At no time prior to 10 February 1998 was she informed that she should follow up on the election of the SBP.  Her former husband made sure all information was updated.  He understood that his records concerning SBP were correct.  He would not have continued to pay premiums if he knew there were problems.  He corrected information after their divorce, right up to two months prior to his death. 

4.  The applicant states that both she and her former husband were blindly misled.  They believed the necessary documents had been submitted.  He continued to contribute to the SBP.  She was not aware that she could request, review, or change the benefits.  She submitted an application for annuities with necessary documents after his death, and was astounded to find out that she could not receive an annuity.

5.  The FSM entered on active duty on 18 February 1970.  On 19 April 1983 the FSM was retired with a permanent physical disability in the rank of staff sergeant with a disability rating of 40 percent.  On 13 April 1983, prior to his retirement, he elected to participate in the SPB at a reduced amount of $350.00.     

6.  The FSM was divorced from the applicant on 7 November 1991.  The divorce decree stipulated that the applicant would remain as the irrevocable beneficiary of the SBP of the FSM.

7.  On 5 February 1992 the FSM had designated the applicant, his former wife, as the beneficiary of unpaid compensation from his civilian employment with the postal service.  He also designated his ex-wife as the beneficiary to receive any benefit payable under the civil service retirement system.  On 31 January 1994 the FSM designated his former wife as one of the beneficiaries for his federal employees’ group life insurance (FEGLI).  On 4 September 1997 he changed his FEGLI election; however, again designated his former wife as one of the beneficiaries for his FEGLI.    
8.  The FSM passed away on 8 November 1997.  The certificate of death indicates that he was divorced.  The surviving spouse item on that certificate is blank.   

9.  On 18 November 1997 the superior court of Washington stated that the applicant was the executor of the will of the deceased FSM, and authorized the applicant to execute the will according to law. 

10.  In November 1997 the applicant applied for annuity under the SBP.

11.  On 10 February 1998 the Defense Finance and Accounting Service (DFAS) at Denver informed the applicant that if the FSM had not made a deemed election [for SBP] within one year after the divorce decree, the agreement in the divorce decree was not valid.  The DFAS stated that there was no deemed election in their records.

12.  Information obtained from an official of the technical branch of the DFAS at Cleveland on 20 March 2000 indicated that the FSM had been making SBP premiums up until the time of his death.  Upon discovery that the FSM was divorced the SBP annuity was suspended.

13.  In May 1997, in response to a congressional inquiry concerning a similar case, the director of customer assessment at the DFAS Cleveland Center informed a member of congress that:

•	a spouse loses status as an SBP beneficiary upon divorce.  The only means by which the divorced spouse may receive a survivorship annuity is if the service member voluntarily elects to provide a former spouse annuity.
•	The Department of Defense Authorization Act of 1984 (Public Law 98-94), approved on 24 September 1943 amended SBP so military retirees could elect former spouse coverage for a spouse who was a beneficiary under the plan, provided their divorce occurred after retirement.  Retirees who were participating in SBP could elect former spouse coverage within one year from the date the divorce became final.
•	The Department of Defense Authorization Act of 1985 (Public Law 98-525), approved on 19 October 1984, further amended SBP.  Section 644 of that law pertains to retired members who enter (in conjunction with a divorce, dissolution, or annulment) into a voluntary written agreement to provide an SBP annuity to a former spouse.  When the agreement has been incorporated in, ratified, or approved by a qualified court order, and the member then fails or refuses to made the required election, that member shall be deemed to have made such election if this Center receives a written request from the former spouse requesting that we implement the election.
•	A former spouse is not automatically covered as an SBP beneficiary, even if the court orders SBP be maintained for the former spouse.  SBP coverage must be changed to former spouse coverage, either voluntarily by the retired member, or by a deemed election request from the former spouse.  

CONCLUSIONS:

1.  Neither the applicant nor the FSM made application to have SBP coverage designation changed to former spouse within one year after their divorce in 1991, as required by law, and the financial records of the FSM apparently contain no evidence of an election.  This Board believes, however, that the applicant presumed that she had SBP coverage, as evidenced by the application she made for an annuity under the SBP in November 1997, during the same month of the death of her former husband.  And the Board believes that the FSM understood that his ex-wife continued to be covered under the SBP, by virtue of his paying premiums up until the date of his death.  Apparently, neither the FSM or the applicant were aware of the requirement to make an election to the DFAS within one year of the divorce decree.  The DFAS was apparently unaware that the FSM was divorced, and suspended payment of an annuity to the applicant upon notification of the divorce.

3.  The applicant was married to the FSM for some 17 years, and upon their divorce, the FSM was directed to provide SPB coverage to his former spouse.  Both he and the applicant supposed that the coverage was provided.  Had either he or the applicant known of the requirement to make an election to DFAS, that election would have been made, most certainly by the applicant, if not by the FSM. 

4.  Therefore, the record should indicate that the applicant made an election for former spouse SBP coverage within the one year period of her November 1991  divorce to the FSM.  Furthermore, she should receive the appropriate annuity associated with this coverage retroactive to the date of the death of the FSM.  

5.  In view of the foregoing, the applicant’s records should be corrected as recommended below.

RECOMMENDATION:

That all of the Department of the Army records related to this case be corrected by showing that the individual concerned made an election for former spouse SBP coverage within the one year period of her November 1991 divorce to the FSM.  Furthermore, she should receive the appropriate annuity associated with this coverage retroactive to the date of the death of the FSM.  

BOARD VOTE:  

___rgh__  ___mdm_  ___jps___  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

		______________________
		        CHAIRPERSON

INDEX

CASE ID	AR1999028367	
SUFFIX		
RECON	YYYYMMDD	
DATE BOARDED	20000329	
TYPE OF DISCHARGE	(HD, GD, UOTHC, UD, BCD, DD, UNCHAR)	
DATE OF DISCHARGE	YYYYMMDD	
DISCHARGE AUTHORITY	AR . . . . .  	
DISCHARGE REASON		
BOARD DECISION	GRANT	
REVIEW AUTHORITY		
ISSUES         1.  301	137.00	
2.		
3.		
4.		
5.		
6.