PROCEEDINGS

	IN THE CASE OF:  

	BOARD DATE:           10 September 2002
	DOCKET NUMBER:   AR2002074757

	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. Carl W. S. Chun		Director	
	Ms. Nancy L. Amos		Analyst	

  The following members, a quorum, were present:

	Mr. Fred N. Eichorn		Chairperson	
	Ms. Barbara J. Ellis		Member	
	Mr. William D. Barr		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 requests that his Survivor Benefit Plan (SBP) coverage be changed to former spouse coverage.  He also requests that all back premiums due be waived or, if this is not possible, that his former spouse be allowed to "double-up" on the monthly deduction rather than have it taken as a lump-sum deduction.

3.  The applicant states his former spouse was to receive the SBP in accordance with the divorce Settlement Agreement.  The Decree of Dissolution of Marriage was signed on 17 October 2000.  These documents are on file at the Defense Finance and Accounting Service (DFAS) but it appears someone there did not understand that the Decree of Dissolution of Marriage was the Final Divorce Decree.  SBP was stopped in December 2001/January 2002 as a result of this error.

4.  The applicant’s military records show that, after having had prior service, he entered active duty in an active Guard/Reserve (AGR) status as a commissioned officer with the Army National Guard in October 1983.  His notification of eligibility for retired pay at age 60 (his 20-year letter) is dated 26 March 1996.  On 8 May 1996, he completed a Survivor Benefit Plan Election Certificate, DD Form 1883, and elected to participate in the Reserve Component SBP (RCSBP) for spouse and children coverage, full base amount, option C.

5.  The applicant retired from active duty on 1 October 2000.

6.  On 17 October 2000, the applicant divorced.  The Settlement Agreement stated in part that the spouse would have "50% of (the applicant's) retirement minus the 7% deduction for her Survivor Benefit Plan (SBP).  SBP provides a lifetime of income in the event of (the applicant's) death.  If the finance and accounting office cannot take the 7% from (the spouse's) 50% then (the spouse) is to receive 43% of (the applicant's) retirement and of the 57% (the applicant receives), 7% will pay for the SBP…"

7.  In a 10 July 2002 response to Senator Lugar, DFAS noted their records indicated the applicant did not make a request to change his election to former spouse coverage nor did his former spouse make a request for a deemed election.  DFAS noted that the law required the request for change or request for a deemed election be received within one year of the divorce and that a divorce decree alone does not constitute a deemed election.

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

9.  Public Law 95-397, the RCSBP, enacted 30 September 1978, provided a way for those who had qualified for reserve retirement but were not yet age 60 to provide an annuity for their survivors should they die before reaching age 60.  Three options are available:  (A)  elect to decline enrollment and choose at age 60 whether to start SBP participation; (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; (C)  elect that a beneficiary receive an annuity immediately upon their death if before age 60.  Option B and C participants do not make a new SBP election at age 60.  Elected RCSBP options automatically roll into SBP coverage.  

10.  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 (Reservists, too).

11.  Public Law 98-525, enacted 19 October 1984, provided that a former spouse could request a deemed election within one year of the court order requiring SBP to be established on the former spouse’s behalf provided the member agreed to provide coverage.

12.  Title 10, U. S. Code, section 1448(b)(3) incorporates the provisions of the USFSPA relating to the SBP.  It permits a person who, incident to a proceeding of divorce, is required by court order to elect to provide an annuity to a former spouse to make such an election.  Any such election must be written, signed by the person making the election, and received by the Secretary concerned within one year after the date of the decree of divorce.  If that person fails or refuses to make such an election, section 1450(f)(3)(A) permits the former spouse concerned to make a written request that such an election be deemed to have been made.  Section 1450(f)(3)(C) provides that an election may not be deemed to have been made unless the request from the former spouse of the person is received within one year of the date of the court order or filing involved.

CONCLUSIONS:

1.  It appears either the applicant or his former spouse only provided a copy of the divorce decree to DFAS to initiate the provisions of the Settlement Agreement with respect to the SBP.  The law requires either the member's request for change or the former spouse's request for a deemed election to be in writing.  Without a cover letter requesting the change to SBP coverage, DFAS could not have effected the change.  

2.  However, it is the applicant's intent to now ensure that the provisions of the Settlement Agreement with respect to the SBP are initiated.  It would be equitable to correct his records to show that he requested, in writing, that his SBP coverage be changed to former spouse and children coverage within the one-year time frame as required by law.

3.  The applicant and/or his former spouse would have anticipated monthly SBP premiums to be due had coverage not been stopped.  Had the applicant died during this period, his former spouse would have been entitled to request this Board make this same correction and so obtain the annuity.  Therefore, there does not appear to be an inequity in requiring that any back SBP premiums due as a result of this correction be paid in full.  However, upon receipt of this Board action the applicant or his former spouse should contact DFAS - Cleveland Center to work out a mutually agreeable payback method.

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

RECOMMENDATION:

1.  That all of the Department of the Army records related to this case be corrected by showing that the applicant requested in writing, on 1 November 2000, that his SBP coverage be changed to former spouse and children coverage and that his request was received and processed by the appropriate office in a timely manner. 

2.  That so much of the application as is in excess of the foregoing be denied.

BOARD VOTE:  

__FNE __  __ BJE  _  __WDB __  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

		__Fred N. Eichorn  _
		   CHAIRPERSON

INDEX

CASE ID	AR2002074757	
SUFFIX		
RECON		
DATE BOARDED	2002/09/10	
TYPE OF DISCHARGE		
DATE OF DISCHARGE		
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	PARTIAL GRANT	
REVIEW AUTHORITY		
ISSUES         1.	137.04	
2.		
3.		
4.		
5.		
6.