Court Opinion

ID: 211004
Source: CourtListenerOpinion
Date Created: 2011-03-13 08:22:30+00
Date Added: 2024-06-11T10:14:04.476198
License: Public Domain

United States Court of Appeals for the Federal Circuit

                                      06-3178

                              RICHARD L. GODBOUT,

                                                           Petitioner,

                                          v.

                     OFFICE OF PERSONNEL MANAGEMENT,

                                                           Respondent.

      Richard L. Godbout, of Tuscola, Texas, pro se.

       Roger A. Hipp, Trial Attorney, Commercial Litigation Branch, Civil Division,
United States Department of Justice, of Washington, DC, for respondent. With him on
the brief were Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director,
and Bryant G. Snee, Assistant Director. Of counsel on the brief was Paul St. Hillaire,
Attorney, Office of Personnel Management, of Washington, DC.

Appealed from: United States Merit Systems Protection Board
 United States Court of Appeals for the Federal Circuit
                                        06-3178

                               RICHARD L. GODBOUT,

                                                             Petitioner,

                                           v.

                      OFFICE OF PERSONNEL MANAGEMENT,

                                                             Respondent.

                           ___________________________

                           DECIDED: October 25, 2006
                           ___________________________

Before MAYER, RADER, and LINN, Circuit Judges.

Opinion for the court filed by Circuit Judge RADER. Dissenting opinion filed by Circuit
Judge MAYER.

RADER, Circuit Judge.

      Mr. Godbout appeals a decision from the Merit Systems Protection Board

(Board) affirming an Office of Personnel Management (OPM) decision to recover

annuity overpayments. See Godbout v. Office of Pers. Mgmt., DA-0845-05-0383-I-1

(Aug. 8, 2005) (Board Decision). The Board affirmed the finding that an overpayment

had occurred and denied Mr. Godbout’s appeal of the overpayment because he did not

request a waiver from OPM. Finding no reversible error, this court affirms.

                                                I.

      In its reconsideration decision, OPM determined that it had overpaid Mr. Godbout

$35,820.55 in civil service annuity benefits. Board Decision at 2. OPM announced that
the agency would collect the overpayment by deducting monthly installments from Mr.

Godbout’s Federal Employees’ Retirement System (FERS) annuity payments. Id. at 2-

3.

      At the time of his retirement in 1994, Mr. Godbout “indicated on his retirement

application that he was awarded military retired pay ‘for a disability incurred in combat

or caused by an instrumentality of war.’”1 Id. at 2. Based on that declaration, OPM

included his active duty in the computation of his FERS annuity benefits. More than ten

years later, OPM learned from the Military Retired Pay Center that Mr. Godbout’s

disability did not occur in combat or by an instrumentality of war. Id. Accordingly, Mr.

Godbout’s annuity benefits should not have included his active duty years.         OPM

requested the information about Mr. Godbout’s disability in 1995. The record on appeal

does not show a reason for the lapse of ten years before recalculation of Mr. Godbout’s

annuity based on the Military Retired Pay Center’s determination.

      The Board found that OPM met its burden of proving the overpayment. Id. at 6.

Specifically, the Board determined that the record showed “that OPM received

certification that [Mr. Godbout’s] disability was not incurred in enemy combat or caused

by an instrumentality of wa[r].” Id. Thus, the Board held that Mr. Godbout had received

an overpayment of $35,820.55. Id. The Board further held that appellant had not met

his burden to allow waiver of the overpayment.         Id. at 7-8.   Finally, the Board

determined that equity and good conscience did not bar recovery of the overpayment.

Id.

1
      Mr. Godbout suffers from Meniere’s Syndrome and Disease which arose
because of his military duties as a Section Leader for the Davy Crockett nuclear
weapons system.

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       On appeal, Mr. Godbout argues that the overpayment was not his fault and

seeks a waiver. Specifically, he argues that Navy personnel helped him complete his

forms and informed him that his disability qualified for credit because it occurred during

a period of war. Further he asserts the ten years of delay before notifying him of an

overpayment absolves him of responsibility.

       In response, the Government argues that Mr. Godbout did not properly request a

waiver. Mr. Godbout admits that he did not check the box to request reconsideration by

OPM.      Moreover, he did not complete the necessary financial questionnaire for

assessment of the waiver. Thus, the Government argues, the Board should never have

considered Mr. Godbout’s waiver request, nor should it be considered on appeal.

                                                II.

       This court may reverse a decision of the Board only if the decision is arbitrary,

capricious, an abuse of discretion, or unlawful; procedurally deficient; or unsupported by

substantial evidence. 5 U.S.C § 7703(c); Hayes v. Dep’t of Navy, 727 F.2d 1535, 1537

(Fed. Cir. 1984).

       This court finds no reason on appeal to disturb the Board's decision that OPM

met its burden of proving an overpayment. OPM showed that Mr. Godbout, whose

injury did not occur during wartime, was not entitled to service credit for his military

service. Therefore, this court affirms the Board’s finding of an overpayment. Board

Decision at 6-7.

       Section 8470(b), United States Code, Title 5, governs the Government’s recovery

of overpayments:

06-3178                                     3
              (b) Recovery of payments . . . may not be made from an individual when,
      in the judgment of the Office, the individual is without fault and recovery would be
      against equity and good conscience.

      By its terms, section 8470(b) prohibits any recovery of payments when OPM has

made a finding that an individual is without fault and that recovery would be against

equity and good conscience. The statute is silent, however, as to whether recovery is

permitted when no finding has been made at all, and as to when OPM must seek to

make a finding. To implement this statutory scheme, OPM requires a waiver to trigger

the finding obligation. In other words, without a waiver request, OPM will not undertake

an investigation into fault and equity. Because this practice represents a reasonable

interpretation of a statute within its purview to implement, this court acknowledges and

upholds the OPM trigger requirement. Chevron v. Natural Def. Res. Council Inc., 467

U.S. 837, 844 (1984). Thus, the Government argues, Mr. Godbout is not entitled to a

consideration of waiver of the debt because he did not check the box on the form sent

to him by OPM when he was initially informed that OPM had discovered its

overpayment.

      In retort, Mr. Godbout states that he did not check the waiver box because,

based on the definition of “waiver” provided on the form, it would be an

acknowledgement of fault on his part (i.e., that he knew all these years of the

overpayments.) OPM’s form directs an individual to check the waiver box when an

individual acknowledges that an overpayment has been made but seeks to waive an

overpayment. Thus, Mr. Godbout interpreted OPM’s form to mean that a request for

waiver would acknowledge, but seek to avoid responsibility for, an overpayment.

Because Mr. Godbout challenged the occurrence of an overpayment (based on his

06-3178                                    4
reliance on Navy Human Resources Personnel in completing his annuity forms in the

first place he never realized he was being paid in excess), he did not check the box for

a waiver.    Thus, Mr. Godbout requested reconsideration, but not waiver, of the

overpayment.

       This court notes that OPM retains the discretion in these circumstances to

undertake a fault and equity finding without a formal waiver request. According to the

Policy Guidelines on the Disposition of Overpayments under the Civil Service

Retirement System and the Federal Employees’ Retirement System, I.A.5, Retirement

and Insurance Service, U.S. Office of Personnel Management (May 1995) (Policy

Guidelines), in a situation such as this, where an “overpayment debtor requests

reconsideration, but not waiver, and in the course of reviewing the reconsideration

request it becomes clear that the debtor is without fault, a pre-request waiver should be

considered and granted if all the conditions for a waiver are fulfilled. If all the conditions

for a waiver are not fulfilled, the reconsideration letter should not address the waiver

issue.” The conditions of waiver are met if OPM determines that the debtor is without

fault and recovery would be against equity. Id., I.A.1. Thus, OPM retains discretion to

waive repayment in some instances without a waiver request. Id., I.A.5. Nonetheless,

the requirement for a waiver to trigger a mandatory finding in the “judgment of the

Office” remains in place.      5 U.S.C. § 8470(b); Policy Guidelines, I.A.5.          Unless

specifically requested by the debtor, the Office has no obligation to make fault and

equity findings. Policy Guidelines, I.A.5.

       Here, in OPM’s February 18, 2005, letter to Mr. Godbout addressing the

discovery of the overpayment, OPM addresses the entire question neutrally: "An

06-3178                                       5
overpayment has resulted due to a delay in re-computing your annuity where the non-

creditable military service was excluded from your annuity computation." OPM makes

no finding about fault.    Moreover, the initial decision letter also contains no OPM

findings about responsibility for the lengthy delay – a contributing factor in both the fault

and equity decisions.

       Later, in its reconsideration decision dated April 14, 2005, OPM identifies that

“the inclusion of military service in the computation of your annuity benefits was

erroneous.”    This decision notes that Mr. Godbout “indicated on [his] retirement

application that [he was] awarded military retired pay for a disability incurred in combat.”

Thus, OPM attributes fault to Mr. Godbout in his incorrect annuity application. The

reconsideration decision did not consider or attribute fault to the lengthy delay. The

reconsideration decision is silent about waiver and without a waiver request, OPM does

not formally address waiver in the reconsideration letter.         Therefore, either OPM

considered waiver and determined that all the conditions for waiver were not present, or

OPM did not consider the issue of waiver period.

       Because OPM did not discuss the issue of waiver in its reconsideration letter the

Board could not reach the question of waiver. In simple terms, waiver was not before

the Board. In its discretion, OPM can weigh the equities without the waiver request. In

the absence of the request, however, Mr. Godbout did not trigger a finding “in the

judgment of the Office” under the statute. Therefore, the Board also could not reach a

finding on waiver. Although the Board purports to affirm OPM’s finding of waiver, this

court determines that OPM did not make such a finding. In practical effect, however,

the Board affirms OPM. This court perceives no reason to disturb that result.

06-3178                                      6
                                            COSTS

     Each party shall bear its own costs.

                                        AFFIRMED

06-3178                                     7
 United States Court of Appeals for the Federal Circuit

                                         06-3178

                                RICHARD L. GODBOUT,

                                                                   Petitioner,

                                             v.

                      OFFICE OF PERSONNEL MANAGEMENT,

                                                                   Respondent.

MAYER, Circuit Judge, dissenting.

        Because 5 U.S.C. § 8470(b) is not ambiguous, and the Office of Personnel

Management (“OPM”) has incorrectly interpreted it, I dissent from the majority’s contrary

view.

        Section 8470(b) provides, “Recovery of payments . . . may not be made from an

individual when, in the judgment of the Office, the individual is without fault and recovery

would be against equity and good conscience.”         Under OPM’s interpretation of the

statute, a determination about fault and equity occurs only upon a waiver request or at

its discretion. See Ante at 3-5. Accordingly, it invariably does not make a determination

respecting some individuals who are in fact without fault and from whom recovery is

against equity and good conscience, and recovers from them. The statute explicitly

provides, however, that recovery may not be had under these circumstances. The only

way to prevent such recovery, and thereby give meaning to Congress’ intent, is for OPM
to automatically make a determination of fault and equity whenever recovery is sought.

See Lacavera v. Dudas, 441 F.3d 1380, 1383 (Fed. Cir. 2006) (setting forth our analysis

under the Chevron framework). Accordingly, I would send the case back to OPM so it

can conduct the inquiry of fault and equity mandated by section 8470(b).

06-3178                                    2