Court Opinion

ID: 9373412
Source: CourtListenerOpinion
Date Created: 2023-02-22 16:04:50.954196+00
Date Added: 2024-06-11T17:16:42.022116
License: Public Domain

UNITED STATES OF AMERICA
                        MERIT SYSTEMS PROTECTION BOARD

     CARL A. CHAMBERS,                               DOCKET NUMBER
                  Appellant,                         SF-831M-21-0376-I-1

                  v.

     OFFICE OF PERSONNEL                             DATE: September 16, 2022
       MANAGEMENT,
                   Agency.

                  THIS ORDER IS NONPRECEDENTIAL 1

           Carl A. Chambers, Stockton, California, pro se.

           Jane Bancroft, Washington, D.C., for the agency.

                                           BEFORE

                               Cathy A. Harris, Vice Chairman
                                Raymond A. Limon, Member
                                 Tristan L. Leavitt, Member

                                     REMAND ORDER

¶1         The appellant has filed a petition for review of the initial decision, which
     affirmed an Office of Personnel Management (OPM) reconsideration decision
     finding the appellant ineligible for a waiver of a claimed $3,426 overpayment in
     Civil Service Retirement System (CSRS) death benefits based on the service of

     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        A nonprecedential order is one that the Board has determined does not add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 Parties may cite nonprecedential orders,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

     his father (the decedent).   For the reasons discussed below, we GRANT the
     appellant’s petition for review, VACATE the initial decision, and REMAND the
     case to the Western Regional Office for further adjudication in accordance with
     this Remand Order.

                    DISCUSSION OF ARGUMENTS ON REVIEW
¶2        The decedent retired based on a disability under the CSRS on April 12,
     1985, Initial Appeal File (IAF), Tab 11 at 88, and died on May 28, 2017, id.
     at 59. His spouse, whom he married in 1955, id. at 81, predeceased him in 2013,
     id. at 60.   Before her death, the decedent had designated his spouse as his
     beneficiary for lump-sum benefits payable under the CSRS upon his death. Id.
     at 61. The decedent did not remarry after his spouse’s death. Id. at 59. At the
     time of his death in 2017, the decedent had three children, all sons, id. at 37, two
     of whom—including the appellant—were over 18 years of age, id. at 44, 73, and
     one born on September 7, 2001, id. at 30. The mother of the decedent’s youngest
     son was not the decedent’s spouse. Id. at 30, 81.
¶3        The appellant filed an application with OPM in 2019 for death benefits
     based on the service of the decedent.      Id. at 44-47.    In response to OPM’s
     requests, the appellant notified OPM that the decedent had two other sons and
     provided their names and home addresses. Id. at 37-39. OPM accordingly paid
     the appellant a lump-sum benefit of $3,426.83, one-third of the decedent’s
     $10,280.49 in contributions to the Civil Service Retirement and Disability Fund
     (Retirement Fund), reserving the remaining two-thirds for the decedent’s other
     sons. Id. at 23, 35-36.
¶4        In a June 24, 2020 initial decision, OPM informed the appellant that,
     because lump-sum benefits are not payable if a child of a deceased annuitant is
     eligible for monthly benefits, and the decedent’s youngest son was a minor child
     eligible for monthly benefits, it was seeking a return of the $3,426.83 paid to the
     appellant in error. Id. at 23-24. The appellant asked for a waiver of recovery of
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     the overpayment in a request for reconsideration, citing his lack of fault in
     creating the overpayment. Id. at 20-21. In an April 13, 2021 reconsideration
     decision, OPM affirmed its initial decision and denied the appellant’s request for
     a waiver. 2 Id. at 11-13. The appellant appealed the reconsideration decision to
     the Board. IAF, Tab 1.
¶5        After holding the appellant’s requested hearing, the administrative judge
     found that OPM established the existence and amount of the overpayment, based
     on his finding that it was undisputed that the appellant was not entitled to the
     death benefits he received.      IAF, Tab 18, Initial Decision (ID) at 3.        The
     administrative judge further found that the appellant was not entitled to a waiver
     of recovery of the overpayment despite his lack of fault, or to an adjustment of
     the repayment schedule.       ID at 3-8.     On review, the appellant claims the
     administrative judge failed to consider that he was without fault in creating the
     overpayment, and that OPM’s “position is unconscionable.” Petition for Review
     (PFR) File, Tab 2 at 3-4. OPM filed a response in opposition. PFR File, Tab 5.
     The evidence is ambiguous as to the decedent’s third son’s entitlement to a
     survivor annuity.

¶6        The appellant bears the burden of establishing his entitlement to a waiver of
     recovery of an overpayment by substantial evidence. Cool v. Office of Personnel
     Management, 31 M.S.P.R. 270, 273 (1985); 5 C.F.R. § 831.1407(b). The burden
     of proof does not shift to the appellant, however, until OPM has first proven the
     existence and amount of an overpayment by a preponderance of the evidence.

     2
       OPM affirmed its initial decision in an earlier reconsideration decision, which the
     appellant also appealed to the Board. Chambers v. Office of Personnel Management,
     MSPB Docket No. SF-831M-21-0020-I-1, Initial Appeal File (0020 IAF), Tab 1. OPM
     subsequently rescinded this reconsideration decision on the grounds that it failed to
     address the appellant’s request for a waiver of recovery of the overpayment, and moved
     to dismiss the appeal for lack of jurisdiction. 0020 IAF, Tab 10 at 4 -5. The
     administrative judge dismissed the appeal pursuant to OPM’s motion. 0020 IAF,
     Tab 15, Initial Decision at 1-3.
                                                                                         4

     Sansom v. Office of Personnel Management, 62 M.S.P.R. 560, 567 (1994); see
     5 C.F.R. § 831.1407(a).
¶7        The applicable law governing claims for CSRS benefits based on the
     decedent’s service—the law in effect when the decedent retired in 1985, Jackson
     v. Office of Personnel Management, 81 M.S.P.R. 107, ¶ 4 (1999)—is, in relevant
     part, unchanged. Under 5 U.S.C. § 8341(e)(2), 3 a surviving child of an employee
     who dies after retiring is entitled to a survivor annuity. Meanwhile, 5 C.F.R.
     § 831.2003(a), which the agency asserts to support its position, IAF, Tab 15,
     Hearing Recording (HR) (agency closing argument), states that “[i]f there is no
     survivor who is entitled to monthly survivor annuity benefits on the death” of a
     former employee or annuitant, the total lump-sum to the former employee’s
     credit in the Retirement Fund “is payable to the person(s) entitled in the normal
     order of precedence” described in 5 U.S.C. § 8342(c).             In turn, 5 U.S.C.
     § 8342(c) provides, in relevant part, that lump-sum benefits are paid to an
     employee’s survivors “alive at the date title to the payment arises,” in an order of
     precedence that lists the deceased employee’s designated beneficiary first, the
     deceased employee’s widow second, and the deceased employee’s children third.
¶8        OPM thus asserts that, because the decedent’s third son is entitled to a
     survivor annuity, the appellant was not entitled to payment of a share of the
     decedent’s lump-sum death benefits.         IAF, Tab 11 at 6.       However, under
     5 U.S.C. § 8341(a)(4), eligibility for a surviving child’s annuity under
     subsection (e) is limited to an unmarried dependent child under age 18, an
     unmarried dependent child incapable of self-support because of a mental or
     physical disability incurred before age 18, or an unmarried dependent child
     between ages 18 and 22 pursuing a full-time course of study at a recognized
     educational institution.     In addition to the requirement that the child be

     3
       The statute codified in 5 U.S.C. § 8341(e)(1) when the decedent retired was
     redesignated as section 8341(e)(2) in 1986, Pub. L. No. 99-251, § 205(a)(1), 100 Stat.
     25 (1986), and remains so designated at present.
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     unmarried, common to each of these categories is the requirement that the child
     be a “dependent,” which 5 U.S.C. § 8341(a)(3) defines to mean that the
     annuitant 4 was, at the time of his death, either living with or contributing to the
     support of the child.
¶9         The only evidence OPM submitted of the decedent’s third son’s eligibility
     for a child’s annuity under 5 U.S.C. § 8341(e) was his birth certificate and
     Standard Form (SF) 2800, Application for Death Benefits, which established that
     he was under age 18 at the time of the decedent’s death and that the decedent
     was his father. 5 IAF, Tab 11 at 30, Tab 14 at 11-14. This evidence does not

     4
       Title 5, United States Code, section 8341(a)(3) defines “dependent” only in relation to
     an involved employee or Member of Congress, apparently omitting any child of an
     annuitant from its purview. However, excluding a child of an annuitant from this
     definition of “dependent” would result in a scenario in which an “employee” who “dies
     after retiring,” meaning an annuitant such as the decedent can leave a surviving child
     entitled to an annuity under 5 U.S.C. § 8341(e)(2), who could never qualify for that
     annuity because he is excluded from the definitions of a qualifying “dependent” or
     “child” under section 8341(a)(3) and (a)(4). Because provisions of a statute should be
     read in harmony, leaving no provision inoperative, superfluous, redundant, or
     contradictory, Foret v. Department of the Army, 105 M.S.P.R. 437, ¶ 9 (2007), we
     interpret the definitions of “dependent” and “child” in 5 U.S.C. § 8341(a)(3) and (a)(4),
     respectively, to apply to an annuitant, as doing so is necessary for the entitlement to a
     child’s survivor annuity under 5 U.S.C. § 8341(e)(2) for the surviving child of an
     employee who “dies after retiring” to have any operative effect. This interpretation is
     consistent with Board precedent. Seth-Morris v. Office of Personnel Management,
     94 M.S.P.R. 166, ¶ 4 (2003); Rajbhandary v. Office of Personnel Management ,
     91 M.S.P.R. 192, ¶ 4 (2002).
     5
       The administrative judge excluded the decedent’s third son’s SF-2800—in which he
     lists himself under “Section E,” which covers a decedent’s unmarried dependent
     children, IAF, Tab 14 at 12—from admission into evidence as untimely, while also
     noting that the exhibit did not appear relevant. HR (administrative judge’s discussion
     of exhibits). Though the exhibit may have been relevant to the issue of whether an
     overpayment existed, it was indeed untimely filed, as OPM filed it with an amended
     prehearing submission 5 days after the deadline for prehearing submissions provided in
     the administrative judge’s order, without demonstrating good cause. IAF, Tab 9 at 1,
     Tab 14. We thus find no basis to disturb the administrative judge’s exclusion of the
     exhibit. However, even if the exhibit were to have been admitted, the decedent’s
     youngest son’s listing of himself under “Section E” as an unmarried dependent child of
     the decedent is contradicted by his listing of himself as an “other heir” of the decedent
     under “Section F,” IAF, Tab 14 at 13, a category which the instructions to SF-2800
                                                                                        6

  establish that the decedent’s third son satisfied the other requirements for
  eligibility for a child’s survivor annuity, including that he was unmarried, either
  of the conditions that would qualify him as a “dependent” under 5 U.S.C.
  § 8341(a)(3), or that after he turned 18, he was incapable of self -support because
  of a mental or physical disability incurred before age 18, or pursuing a full -time
  course of study at a recognized educational institution. OPM’s evidence of the
  decedent’s third son’s entitlement to a survivor annuity, and consequently, its
  evidence of the existence and amount of the claimed overpayment to the
  appellant, is therefore ambiguous. Although the administrative judge based his
  finding that OPM established the existence and amount of the overpayment on
  his finding that they were not disputed, 6 ID at 3, this was an error, as OPM’s
  burden of proof is not met simply based upon the absence of an objection from
  the appellant, Sansom, 62 M.S.P.R. at 567 (citing 5 C.F.R. § 831.1407(a)). The
  Board will require OPM to meet its burden of proof, regardless of whether the
  appellant objects specifically to elements of that proof, and to produce all of the
  relevant, material, and credible evidence bearing on the amount and existence of
  the overpayment. Id.
  The administrative judge erred in denying OPM’s request to notify the decedent’s
  non-party children of their rights to intervene in the appeal.

¶10     The Board’s regulations provide that administrative judges have the
  authority to require that persons who can be identified from the record as being
  “clearly and directly affected” by a pending retirement-related case be notified of

  state include “[c]hildren of the deceased not included in Section E,” IAF, Tab 11 at 49.
  These inconsistent representations render the SF-2800 non-probative as to the
  decedent’s third son’s eligibility for a survivor annuity under 5 U.S.C. § 8341(e).
  6
    There is no indication in the record that the appellant was aware of the detailed
  eligibility requirements for a child’s survivor annuity under 5 U.S.C. § 8341(e) to
  knowingly concede or dispute the overpayment. On the contrary, the appellant testified
  at the hearing that he did not know what government entitlements the decedent’s third
  son was eligible for. HR (testimony of the appellant). The appellant made the same
  assertion in his reconsideration request to OPM. IAF, Tab 11 at 20.
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  their right to request intervention in the appeal so that their interests can be
  considered in the adjudication. 5 C.F.R. § 1201.41(b)(13). The Board has stated
  that an administrative judge must invite any person or organization directly
  affected by an appeal to intervene. Holser v. Office of Personnel Management,
  72 M.S.P.R. 247, 250 (1996).
¶11    During the appeal, OPM requested that the administrative judge notify the
  decedent’s non-party children of their rights to intervene in the appeal under
  5 C.F.R. § 1201.34. IAF, Tab 11 at 10. The administrative judge denied this
  request, finding that the decedent’s non-party children’s rights were not
  potentially implicated by his decision in the appeal. HR (administrative judge’s
  summary of prehearing discussion).
¶12    As indicated in the reconsideration decision, OPM determined the appellant
  was paid lump-sum death benefits erroneously based on its finding that the
  decedent’s third son was entitled to a child’s survivor annuity, IAF, Tab 11 at 11,
  and thus, whether the decedent’s third son was in fact entitled to a survivor
  annuity was placed directly at issue in this appeal. The decedent’s third son is
  therefore “clearly and directly affected” by this appeal.       The rights of the
  decedent’s other non-party child to CSRS benefits based on the decedent’s
  service appear to be equivalent to those of the appellant, and the effect of this
  appeal on those rights are therefore also clear and direct.      Accordingly, the
  interests of justice would be served by allowing the decedent’s non-party
  children the opportunity to intervene in this proceeding, and the administrative
  judge’s denial of OPM’s request to notify them of their rights to intervene was
  an error. See Alexander v. Office of Personnel Management, 58 M.S.P.R. 358,
  368 (1993) (finding that an administrative judge should have afforded a deceased
  employee’s former spouse an opportunity to intervene in an appeal when her
  entitlement to a lump-sum survivor benefit could have been directly affected by
  the outcome of the appeal). We therefore remand this appeal to the Western
  Regional Office for further adjudication and order that attempts be made to
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  afford the decedent’s non-party children an opportunity to intervene.        On
  remand, all parties shall be permitted to introduce additional evidence and
  argument on the issues relevant to this case.

                                       ORDER
¶13    For the reasons discussed above, we remand this case to the Western
  Regional Office for further adjudication in accordance with this Remand Order.

  FOR THE BOARD:                                  /s/ for
                                           Jennifer Everling
                                           Acting Clerk of the Board
  Washington, D.C.