Court Opinion

ID: 618698
Source: CourtListenerOpinion
Date Created: 2011-12-12 16:41:53+00
Date Added: 2024-06-11T17:50:45.846235
License: Public Domain

NOTE: This disposition is nonprecedential.

  United States Court of Appeals
      for the Federal Circuit
                __________________________

               ARTHUR ALFRED KOPP,
                    Petitioner,

                             v.
       OFFICE OF PERSONNEL MANAGEMENT,
                   Respondent.
                __________________________

                        2011-3181
                __________________________

   Petition for review of the Merit Systems Protection
Board in DC831M100653-I-1.
              ___________________________

               Decided: December 12, 2011
               ___________________________

      ARTHUR ALFRED KOPP, Pittsboro, North Carolina, pro
se.

    CAMERON COHICK, Trial Attorney, Commercial Litiga-
tion Branch, Civil Division, United States Department of
Justice, of Washington, DC, for respondent. With him on
the brief were TONY WEST, Assistant Attorney General,
JEANNE E. DAVIDSON, Director, and HAROLD D. LESTER,
JR., Assistant Director. Of counsel on the brief was
KOPP   v. OPM                                           2

JOANN CHABOT, Office of General Counsel, Office of Per-
sonnel Management, of Washington, DC.
             __________________________

 Before RADER, Chief Judge, BRYSON, and REYNA, Circuit
                        Judges.
PER CURIAM.

                        DECISION

    Arthur Alfred Kopp petitions for review of a final or-
der of the Merit Systems Protection Board denying his
request for a waiver of overpayment of annuity benefits
under the Civil Service Retirement System. We affirm.

                      BACKGROUND

    Mr. Kopp served in the United States military from
January 15, 1964, through November 7, 1969. On Janu-
ary 26, 1970, Mr. Kopp began working for the Federal
Aviation Administration (“FAA”) as an air traffic control
specialist. On July 22, 1982, he was separated from the
FAA and was granted a disability retirement annuity. On
July 23, 1982, he elected to receive workers’ compensation
benefits from the Labor Department instead of receiving
disability retirement benefits.

    On May 1, 2005, Mr. Kopp was reemployed by the
FAA as a Technical Assistant, where he worked until May
2, 2008, when he retired. Upon Mr. Kopp’s separation
from service, the Office of Personnel Management
(“OPM”) recalculated his annuity. In recalculating his
annuity, OPM gave Mr. Kopp service credit for his period
of reemployment as if he were a new hire. However,
because Mr. Kopp was over 60 years old at the time of his
reemployment, he should have been continued as an
3                                              KOPP   v. OPM

annuitant during his period of reemployment. See 5
U.S.C. § 8337(d). As an annuitant who worked more than
a year but less than five years, Mr. Kopp was entitled to a
supplemental annuity but not a recomputed annuity. See
5 C.F.R. §§ 837.503, 837.504. 1 The effect of OPM’s error
was not only to give Mr. Kopp service credit for the period
of his reemployment, but also to give him credit for the
period between July 22, 1982, and May 1, 2005, when he
was receiving workers’ compensation benefits. Those
errors resulted in an overpayment to Mr. Kopp of
$50,865.83 over the period between May 3, 2008, and
January 31, 2010.

    On February 19, 2010, OPM sent a letter to Mr. Kopp
explaining the error in the calculation of his annuity and
the resulting overpayment. OPM sought reimbursement
of the overpayment, but Mr. Kopp requested that OPM
waive the requirement that he refund the overpayment.
OPM rejected his request for a waiver, finding that recov-
ery of the overpayment would not be unconscionable
under the circumstances, that it would not cause financial
hardship, and that Mr. Kopp had not shown that he had
detrimentally relied on the overpayment.

    Mr. Kopp then appealed to the Merit Systems Protec-
tion Board. The administrative judge who was assigned
to the case affirmed OPM’s denial of Mr. Kopp’s request
for a waiver, finding that a waiver was not required based
either on financial hardship or detrimental reliance. As

    1   Although Mr. Kopp was receiving workers’ com-
pensation benefits rather than disability retirement
benefits, he was still considered an OPM annuitant
because if he stopped receiving workers’ compensation
benefits, his disability retirement annuity would be
restored.
KOPP   v. OPM                                            4

to financial hardship, the administrative judge found that
based on the information provided by Mr. Kopp in his
financial resources questionnaire, Mr. Kopp had enough
income and liquid assets to repay the overpayment ac-
cording to the schedule proposed by OPM. As to detri-
mental reliance, the administrative judge rejected Mr.
Kopp’s argument that the overpayment caused him to
move from Texas to North Carolina and take on new debt.

    The full Board denied Mr. Kopp’s petition to review
the initial decision. In addition to approving the adminis-
trative judge’s findings regarding financial hardship and
detrimental reliance, the full Board dismissed Mr. Kopp’s
argument that repayment would be unconscionable on the
ground that there was a relationship between the re-
quired repayment of the overpayment and health issues
Mr. Kopp claimed to have suffered.

                       DISCUSSION

    Mr. Kopp has not questioned the existence of the
overpayment, and OPM has determined that Mr. Kopp
was not at fault in causing or contributing to the over-
payment. Therefore, the only issue in this case is
whether the repayment should be waived because recov-
ery of the repayment would be against “equity and good
conscience.” 5 U.S.C. § 8346(b). OPM has provided by
regulation that recovery of an overpayment is against
equity and good conscience if

   (1) It would cause financial hardship to the person
   from whom it is sought;

   (2) The recipient of the overpayment can show . . .
   that due to the notice that such payment would be
   made or because of the incorrect payment either
5                                             KOPP   v. OPM

    he/she has relinquished a valuable right or
    changed positions for the worse; or

    (3) Recovery could be unconscionable under the
    circumstances.

5 C.F.R. § 831.1403.

     Mr. Kopp argues that requiring him to make the re-
payment would cause him financial hardship. The Board
properly considered Mr. Kopp’s financial situation as
described in his financial resources questionnaire. It
followed the Policy Guidelines on the Disposition of Over-
payments under the Civil Service Retirement System and
the Federal Employees’ Retirement System in finding that,
after considering Mr. Kopp’s household income and ex-
penses, he had enough income and liquid assets to refund
the overpayment according to OPM’s proposed schedule
without suffering financial hardship. That finding, based
on OPM’s analysis of Mr. Kopp’s financial information, is
supported by substantial evidence.

    Mr. Kopp next argues that the Board erred by not
considering the timeline of the overpayment. He argues
that during the 20 months in which he was receiving the
overpayment he made financial plans that were not
reversible and thus detrimentally relied on the overpay-
ment. The Board, however, considered that argument
and found that Mr. Kopp did not sustain his burden of
showing a causal link between the overpayment and his
decision to move from Texas to North Carolina and incur
more debt. The Board was also unpersuaded by Mr.
Kopp’s claim that the overpayment led him to make
irreversible financial commitments; in that regard, the
Board noted that to the extent Mr. Kopp used the over-
payment to fund the purchase of a house in North Caro-
KOPP   v. OPM                                             6

lina, he retained ownership of the house, an asset that
could be used to facilitate the repayment. In light of Mr.
Kopp’s failure to provide evidentiary support for his claim
of detrimental reliance, we conclude that the Board’s
findings on that issue were supported by substantial
evidence.

    Mr. Kopp notes that the FAA’s mistake in offering
him a job when he was over 60 years old and classifying
him as a new hire, rather than as a returning annuitant,
contributed to the overpayment. While it is true that Mr.
Kopp was not at fault for the overpayment, simply being
without fault does not entitle Mr. Kopp to retain the
overpayment. The applicable statute and regulations
make clear that, in addition to showing that he is without
fault, an individual seeking a waiver of the repayment
obligation must show that recovery “would be against
equity and good conscience.” 5 U.S.C. § 8346(b); 5 C.F.R.
§ 831.1401-1404.     Moreover, even assuming that Mr.
Kopp relied on the representations regarding his classifi-
cation as an inducement to accept reemployment in 2005,
any such reliance does not serve to entitle him to benefits
that were not authorized by statute. See Office of Pers.
Mgmt. v. Richmond, 496 U.S. 414, 416 (1990).

    Finally, Mr. Kopp argues that rejecting his request for
a waiver of overpayment would be unconscionable in light
of a variety of health issues he suffered prior to his sepa-
ration from service in 2008. Mr. Kopp did not provide the
Board with medical records documenting those conditions,
and he has not explained how those conditions relate to
his request for a waiver of the repayment requirement.
The Board therefore properly rejected that contention.

   In sum, the Board’s order upholding OPM’s denial of
Mr. Kopp’s request for a waiver of the repayment re-
7                                        KOPP   v. OPM

quirement was supported by substantial evidence and
was not contrary to law.

    No costs.

                   AFFIRMED