Court Opinion

ID: 9951938
Source: CourtListenerOpinion
Date Created: 2024-03-19 16:00:33.090628+00
Date Added: 2024-06-11T14:43:44.306927
License: Public Domain

UNITED STATES OF AMERICA
                   MERIT SYSTEMS PROTECTION BOARD

JANET SMITH,                                    DOCKET NUMBER
                    Appellant,                  NY-0831-18-0042-I-1

             v.

OFFICE OF PERSONNEL                             DATE: March 18, 2024
  MANAGEMENT,
              Agency.

             THIS ORDER IS NONPRECEDENTIAL 1

      Janet Smith , Brooklyn, New York, pro se.

      Carla Robinson , Washington, D.C., for the agency.

                                      BEFORE

                           Cathy A. Harris, Chairman
                        Raymond A. Limon, Vice Chairman

                                 REMAND ORDER

      The Office of Personnel Management (OPM) has filed a petition for review
of the initial decision, which reversed its reconsideration decision denying the
appellant’s application for a deferred Civil Service Retirement Systems (CSRS)
annuity.   For the reasons discussed below, we GRANT OPM’s petition for
review.    We AFFIRM the initial decision in part, as MODIFIED, still
1
   A nonprecedential order is one that the Board has determined does not add
significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
                                                                                     2

REVERSING OPM’s reconsideration decision and finding that the appellant
proved her nonreceipt of a refund for $1,028.12 in retirement deductions. We
VACATE the initial decision, in part, as to its determination that the appellant is
entitled to a CSRS annuity and REMAND this case to OPM for a reconsideration
decision on the issue of the appellant’s annuity entitlement.

                                  BACKGROUND
      The appellant worked for the Department of the Navy in a career position
from July 20, 1986, to June 30, 1994. Initial Appeal File (IAF), Tab 1 at 2,
11-12, Tab 7 at 22-25, 29. 2 In November 1994, she applied for a refund of her
CSRS retirement deductions.       IAF, Tab 7 at 35-36.       One month later, OPM
authorized a payment of $1,028.12, to reimburse the appellant for her deductions
from October 12, 1986, to June 30, 1994. Id. at 8, 21-23.
      In February 1996, the appellant wrote to the Defense Financing and
Accounting Service (DFAS) to obtain information regarding her payment. IAF,
Tab 1 at 14, Tab 12, Hearing Compact Disc (HCD) at 11:50-12:00 (testimony of
the appellant).   In March 1996, OPM wrote to the appellant that it could not
“authorize a refund of [her] retirement deductions” because her application was
more than a year old.      IAF, Tab 7 at 34.     The appellant submitted a second
application in April 1996.      Id. at 29-33.    Later that month, OPM paid the
appellant $9.49, representing her deduction for the earlier service period of
July 20 to October 11, 1986. Id. at 20, 24-25.
      In 2003, the appellant asked OPM for information as to the 1994 refund.
Id. at 18.   OPM provided her with a copy of her application and individual
retirement record (IRR), but because the payment was “older than 6 years and 7
2
  The appellant’s employing agency is referred to in various records as the Department
of the Navy and the Department of Defense. E.g., IAF, Tab 1 at 12-13, Tab 7 at 22,
24-25, 29. For purposes of this decision, we will refer to her employing agency as the
Navy. The appellant also had an initial period of employment with this agency in a
temporary position, which is not at issue in this appeal. IAF, Tab 7 at 24. Also not at
issue in this appeal is her employment with the U.S. Postal Service, for which she also
applied for a refund of her retirement deductions. Id. at 37-40.
                                                                                  3

months,” referred her to the Department of Treasury for information as to her
payment. Id. The appellant wrote to the Department of the Treasury in August
2003, but did not receive a response. Id. at 17; HCD at 10:13-10:21 (testimony of
the appellant).
      In late 2017, the appellant submitted an application for a deferred
retirement annuity, seeking a CSRS annuity for her employment with the Navy.
IAF, Tab 7 at 10-16. OPM issued a reconsideration decision on November 29,
2017, denying her request because of the prior refund of $1,028.12. Id. at 8-9. It
did not mention the subsequent refund of $9.49.       Id.   The appellant filed the
instant appeal, asserting that she was entitled to both a severance from the Navy
and an annuity from OPM. IAF, Tab 1 at 3. She denied receiving the payment of
$1,028.12.   Id. at 5.   She also disputed that the payment would have been
sufficient to refund her deductions. Id.
      After holding a telephonic hearing, the administrative judge issued an
initial decision reversing OPM’s reconsideration decision. IAF, Tab 13, Initial
Decision (ID) at 1-2, 6. She explained that the Board does not have jurisdiction
over the alleged nonpayment of a severance. ID at 1 n.1. As to the appellant’s
refund of her deductions, the administrative judge determined that the appellant
received the payment of $9.49. ID at 2 n.2. However, she concluded that the
appellant met her burden to prove that she did not receive the payment of
$1,028.12. ID at 3-6. Therefore, she found that the appellant was entitled to an
annuity. ID at 6.
      On review, OPM continues to argue that the appellant received the
$1,028.12 payment. IAF, Tab 7 at 5-6; Petition for Review (PFR) File, Tab 1
at 14-17. It further asserts that, even if she did not receive this refund payment,
she is only entitled to the refund, and not an annuity. PFR File, Tab 1 at 17-19.
The appellant has not responded to the agency’s petition for review.
                                                                                  4

                DISCUSSION OF ARGUMENTS ON REVIEW
The administrative judge properly found that the appellant met her burden to
show nonreceipt of the payment.
      The parties do not dispute that the appellant received a payment of $9.49. 3
HCD at 15:17-15:20 (testimony of the appellant). However, the agency disagrees
with the administrative judge’s determination that the appellant did not receive
the payment of $1,028.12.      PFR File, Tab 1 at 14-17.      We agree with the
administrative judge that the appellant proved nonreceipt. ID at 3-5.
      The appellant bears the burden to prove her entitlement to a retirement
annuity by preponderant evidence.      Rint v. Office of Personnel Management,
48 M.S.P.R. 69, 71, aff’d per curiam, 950 F.2d 731 (Fed. Cir. 1991) (Table). An
individual’s receipt of retirement deductions for a period of service generally
voids her right to a retirement annuity for that period absent a redeposit of those
deductions. 5 U.S.C. §§ 8334(d)(1), 8342(a); Rint, 48 M.S.P.R. at 72; 5 C.F.R.
§§ 831.112(a), 831.303(b).   Thus, at a minimum, the appellant must prove by
preponderant evidence that she did not receive the payment in question.       Rint,
48 M.S.P.R. at 71.
      The Board has held that normal office records, compiled in the ordinary
course of business, are admissible and are entitled to substantial weight.      Id.
at 72. Further, OPM is not required to produce definitive proof of an appellant’s
actual receipt of payment, such as a cancelled Treasury check, when its ability to
produce such evidence is impaired by an appellant’s lengthy delay in raising her
claim of nonpayment. Sosa v. Office of Personnel Management, 76 M.S.P.R. 683,
686 (1997); DeLeon v. Office of Personnel Management, 49 M.S.P.R. 369, 373
(1991). In such circumstances, the Board has found that OPM’s record of an
appellant’s application for a refund, combined with records reflecting that it
authorized payment, is sufficient to establish that the appellant received the

3
  In addition, they do not assert that the Board has jurisdiction over the alleged
nonpayment of a severance. We decline to disturb the administrative judge’s finding
that it does not.
                                                                                   5

refund. DeLeon, 49 M.S.P.R. at 372-73; Rint, 48 M.S.P.R. at 72. Such records
give rise to an inference that a refund was made accordingly. See Danganan v.
Office of Personnel Management, 55 M.S.P.R. 265, 269 (1992) (finding an IRR
reflecting the amount of the refund payment was persuasive evidence that the
payment was made), aff’d per curiam, 19 F.3d 40 (1994) (Table). However, the
Board will not infer receipt if an appellant placed OPM on notice that there was a
question as to her receipt of the refund within a period of time such that OPM
could have ascertained whether any mailed check had been negotiated, or
cancelled any issued check and issued a new check order.          See Manoharan v.
Office     of   Personnel   Management,    103 M.S.P.R.    159,   ¶¶ 16-18    (2006)
(distinguishing from DeLeon, Rint, and Sosa because the appellants in those
appeals waited between 22 and 32 years before bringing their alleged nonreceipt
of funds to OPM’s attention, while the appellant in Manoharan waited less than
4 months).
         The administrative judge credited the appellant’s testimony that she never
received the refund of $1,028.12. ID at 4. Although she concluded that OPM’s
business records created an inference of receipt of the payment, she found that the
appellant’s testimony outweighed this evidence. We agree that OPM’s business
records, compiled in the ordinary course of business, are entitled to substantial
weight.     DeLeon, 49 M.S.P.R. at 372.     However, we decline to infer that the
appellant received the refund payment based on OPM’s submission of the IRR
and voucher request. As discussed above, this inference arises when OPM would
be unduly prejudiced were we to require it to provide more definitive proof of the
appellant’s actual receipt of the check due to the passage of time.          DeLeon,
49 M.S.P.R. at 373; see Manoharan, 103 M.S.P.R. 159, ¶ 18.          Although OPM
argues that the appellant “affirmatively” raised her claim of nonpayment for the
first time in her Board appeal, it admits that she made an inquiry about it in
April 2003. PFR File, Tab 1 at 9-10, 14-15. We conclude that her April 2003
inquiry, made less than 10 years after OPM allegedly paid the appellant, should
                                                                                 6

have provided OPM with sufficient notice to ascertain whether the check was
negotiated or cancel and issue a new check.      PFR File, Tab 1 at 14-15; see
Manoharan, 103 M.S.P.R. 159, ¶ 16 (observing that, per OPM, Treasury retains
copies of cancelled checks for up to 10 years). Instead of doing so, OPM referred
the appellant to Treasury. IAF, Tab 7 at 18. Although the appellant inquired
with Treasury, she testified that she received no response.   IAF, Tab 7 at 17,
Tab 12, HCD at 10:13-10:21 (testimony of the appellant).
      OPM also disputes the administrative judge’s finding that the appellant’s
letter to DFAS in February 1996 and OPM’s March 1996 request that she submit
a new refund application support a finding that OPM did not make the earlier
payment of $1,208.12.    PFR File, Tab 1 at 16-17; ID at 4-5.     We agree and
modify the initial decision to the extent that the administrative judge relied on
this correspondence. ID at 5. In making this finding, the administrative judge
mistakenly found that the $9.49 payment was for retirement deductions associated
with service in a different agency. ID at 2 & n.2. However, as discussed above,
the $1,028.12 and $9.49 payments covered two portions of the appellant’s
continuous employment with the Navy. IAF, Tab 7 at 20-25. Assuming that
OPM received the appellant’s February 1996 inquiry from DFAS, it appears
likely that it believed the matter was resolved after it requested and received a
new application from the appellant and paid her $9.49 in April 1996, to cover
deductions during the remainder of her employment with the Navy. Id. at 29-34.
      Thus, we agree with the administrative judge’s finding that the appellant
proved nonreceipt of her refund payment, but modify her reasoning as discussed
above. We affirm the administrative judge’s reversal of OPM’s reconsideration
decision.
                                                                                    7

We vacate the administrative judge’s finding that the appellant is entitled to
annuity benefits and remand this issue to OPM for issuance of a new
reconsideration decision.
      OPM argues that, if the appellant did not receive her refund payment, the
most she is entitled to is a new payment. PFR File, Tab 1 at 17-18. It also asserts
that she should have been placed in the CSRS “interim plan” effective July 20,
1986, and the CSRS Offset plan effective January 1, 1987. Id. at 7 n.1. We find
that these issues are not properly before us, and vacate the administrative judge’s
finding that the appellant is entitled to an annuity. ID at 6. We remand this
matter to OPM for issuance of a new reconsideration decision that addresses the
appellant’s rights and benefits in light her nonreceipt of the $1,028.12 payment.
      The Board generally has jurisdiction over an OPM determination on the
merits of a matter affecting the rights or interests of an individual under CSRS
only after OPM has issued a reconsideration decision. 5 U.S.C. § 8347(d)(1);
Hasanadka v. Office of Personnel Management, 116 M.S.P.R. 636, ¶ 19 (2011);
5 C.F.R. § 831.110.    Because OPM has not yet considered the impact of the
appellant’s nonreceipt of the $1,028.12 payment on her entitlement to a
retirement annuity or issued a reconsideration decision in light of this finding, the
Board currently lacks jurisdiction to consider this issue. See Cooper v. Office of
Personnel Management, 43 M.S.P.R. 458, 460-61 (1990) (finding that OPM erred
in determining that an appellant was barred by statute from receiving survivor
annuity for her ex-husband’s service, and remanding for OPM to address whether
a subsequent spouse had a superior right to the annuity).
      For the reasons discussed above, we REMAND this appeal to OPM for
further adjudication in accordance with this Remand Order.

                                      ORDER
      We ORDER the agency to issue a new reconsideration decision addressing
whether the appellant’s nonreceipt of the $1,028.12 payment entitles her to an
annuity or a reimbursement payment.        In doing so, OPM shall calculate the
                                                                                  8

amount of any monthly annuity or lump-sum payment. OPM shall issue the new
reconsideration decision within 60 calendar days from the date of this Remand
Order and shall advise the appellant of her right to file an appeal with the New
York Field Office if she disagrees with that new decision.        Ott v. Office of
Personnel Management, 120 M.S.P.R. 453, ¶ 9 (2013).
      We further ORDER OPM to tell the appellant promptly in writing when it
believes it has fully carried out the Board’s Order and of the actions it has taken
to carry out the Board’s Order.       The appellant shall provide all necessary
information OPM requests to help it carry out this Remand Order. The appellant,
if not notified, should ask OPM about its progress. See 5 C.F.R. § 1201.181(b).
      No later than 30 days after OPM tells the appellant that it has fully carried
out the Board’s Order, the appellant may file a petition for enforcement with the
New York Field Office if she believes that OPM did not fully carry out the
Board’s Order. The petition should contain specific reasons why the appellant
believes that the agency has not fully carried out the Board’s Order, and should
include the dates and results of any communications with the agency. 5 C.F.R.
§ 1201.182(a).

FOR THE BOARD:                        ______________________________
                                      Gina K. Grippando
                                      Clerk of the Board
Washington, D.C.