The opinion
UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
ELIZABETH A. EMOND, DOCKET NUMBER
Appellant, DC-831M-12-0383-I-2
v.
OFFICE OF PERSONNEL DATE: June 25, 2015
MANAGEMENT,
Agency,
and,
JANICE BURNS,
MARILYN EDINGTON
Intervenors.
THIS FINAL ORDER IS NO NPRECEDENTIAL 1
John J. Rigby, Esquire, Arlington, Virginia, for the appellant.
Rebecca J. Wade, Esquire, Alexandria, Virginia, for the intervenors.
Cynthia Reinhold, Washington, D.C., for the agency.
BEFORE
Susan Tsui Grundmann, Chairman
Mark A. Robbins, Member
1
A nonprecedential order is one that the Board has determined does not add
sign ificantly 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 Parties may cite nonprecedential orders,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
REMAND ORDER
¶1 The Office of Personnel Management (OPM) has filed a petition for review
of the initial decision, which reversed OPM’s reconsideration decision finding
that the appellant received an overpayment of civil service annuity benefits and
was not eligible for a waiver of the overpayment. For the reasons discussed
below, we GRANT OPM’s petition for review, VACATE the initial decision, and
REMAND the case to the regional office for further adjudication in accordance
with this Order.
BACKGROUND
¶2 The appellant and federal employee Bobby Burns divorced in 1989. When
he died in 2008, while he was still employed by the Internal Revenue Service, the
appellant filed an Application for Death Benefits as a former spouse. Emond v.
Office of Personnel Management, MSPB Docket No. DC-831M-12-0383-I-1 (I-1),
Initial Appeal File (IAF), Tab 4 at 96. With her application, she submitted a copy
of a Final Decree of Divorce, entered on March 24, 1989, in the Commonwealth
of Virginia, awarding her a former spouse retirement annuity. Id., Tab 1 at 10-13.
In an initial decision dated March 31, 2009, OPM notified her that it would honor
the court order and grant her a former spouse survivor annuity under the Civil
Service Retirement System (CSRS). Id., Tab 4 at 92. On the same day, OPM
issued another initial decision advising Mr. Burns’ mother that she was not
eligible for survivor benefits as a result of her son’s death because the appellant,
as a former spouse, was entitled to monthly annuity payments. Id. at 69. The
executor of Mr. Burns’ estate subsequently submitted a certified copy of a final
decree of divorce between the appellant and Mr. Burns, also entered on March 24,
1989, which the executor stated she had “personally retrieved” from the court and
which differed from the decree that the appellant had submitted in that it did not
contain any language awarding the appellant a survivor annuity. Id. at 71-76. On
that basis, Mr. Burns’ mother requested reconsideration of OPM’s initial decision
3
denying her benefits. Id. at 68. On May 26, 2010, OPM issued another initial
decision advising the appellant that, based on the additional documentation it had
received, she was not eligible for a former spouse survivor annuity. Id. at 54.
She requested reconsideration of that decision. Id. at 15-20. In yet another initial
decision, OPM notified the appellant that, in addition to being ineligible for
benefits, based on its delay in terminating her annuity, she had been overpaid in
the amount of $62,739.96, for the period from December 16, 2008, to
February 28, 2010. Id., Tab 1 at 65-66. In its reconsideration decision, OPM
explained that it had received from the Circuit Court of Fairfax County, Virginia,
a certified copy of the appellant’s final divorce decree, which did not award her a
survivor annuity, and that she therefore must return to the Retirement Fund all
monies paid her. Id., Tab 4 at 10. OPM stated that, unless the appellant could
present indisputable evidence that the court order she provided was authentic,
OPM could not honor it. Id. at 12. OPM further advised the appellant that she
was not totally without fault in the matter 2 and that, therefore, she did not meet
the eligibility requirements for waiver of the overpayment. Id.
¶3 On appeal, the appellant argued that the copy of the divorce decree she
submitted was certified on August 6, 2002, and that there was no information to
indicate that it was invalid in any way. Id., Tab 1 at 17. She did not request a
hearing before the Board. Id. at 4.
2
In an earlier reconsideration decision, OPM found that the appellant was not at fau lt in
causing or contributing to the overpayment. I-1, IAF, Tab 1 at 88. The parties agree
that OPM rescinded that decision. I d. at 15; Emond v. Office of Personnel
Management, MSPB Docket No. DC-831M-12-0383-I-2 (I-2), Petition for Review
(PFR) File, Tab 9 at 7. The appellant’s appeal from that rescinded reconsideration
decision was dismissed for lack of jurisd iction. Emond v. Office of Personnel
Management, MSPB Docket No. DC-831M-11-0232-I-1, Initial Decision at 1-2
(Jan. 20, 2011).
4
¶4 After considering the parties’ written submissions, the administrative judge
issued an initial decision reversing OPM’s reconsideration decision. 3 Emond v.
Office of Personnel Management, MSPB Docket No. DC-831M-12-0383-I-2 (I-2),
IAF, Tab 4, Initial Decision (ID) at 1, 8. He found that the appellant had
submitted to OPM a copy of a “certified [court] order”/divorce decree which
awarded her survivor benefits and otherwise complied with OPM’s regulations. 4
I-2, ID at 4. Notwithstanding the conflicting order that Mr. Burns’ mother had
submitted, the administrative judge found no evidence whatsoever that the
appellant’s certified copy was invalid or illegitimate in any way, that she was
entitled to the former spouse survivor annuity, and that therefore no overpayment
had occurred. 5 I-2, ID at 5.
¶5 OPM filed a petition for review in which it argued that the administrative
judge erred by not requiring the appellant to prove her entitlement to the benefit
she seeks and in not examining or inquiring into the best evidence of the
authenticity of the documents. Petition for Review (PFR) File, Tab 1. In
response, the appellant argued in support of the administrative judge’s findings in
the initial decision. Id., Tab 8. Determining that the record was not fully
3
Pursuant to the appellant’s request, the administrative judge d ismissed her initial
appeal without prejudice to her right to refile. I-1, IAF, Tab 12; Emond v. Office of
Personnel Management, MSPB Docket No. DC-831M-12-0383-I-1, Initial Decision at
1-2 (June 12, 2012). The appellant timely refiled the appeal, I-2, IAF, Tab 1, and
adjudication continued.
4
The administrative judge repeatedly stated that the appellant provided this copy to
OPM in 2002. I-2, ID, at 4-6. OPM disputes that date, arguing instead that the
appellant submitted the copy along with her application for benefits in 2009. PFR File,
Tab 1 at 11. Since Mr. Burns died in December 2008, it seems likely that the
administrative judge erred in using the 2002 date. Any such error, however, did not
adversely affect the substantive rights of either party. Karapinka v. Department of
Energy, 6 M.S.P.R. 124, 127 (1981).
5
The administrative judge found that, even if the appellant were overpaid annuity
benefits, she had shown that she was entitled to waiver of the overpayment because she
was without fault and because recovery would be against equity and good conscience
based on financial hardship. I-2, ID at 5-8.
5
developed on the issue of which copy of the court decree was invalid, the Board
ordered OPM to obtain an order from the state court specifically declaring that
either the copy of the decree submitted by the appellant or by her ex-husband’s
estate was invalid. Id., Tab 11. OPM submitted a number of documents in the
form of pleadings previously filed by the appellant and her ex-husband in the
Virginia Court of Appeals and the Supreme Court of Virginia concerning their
divorce, documents which OPM argued established that the appellant was not
awarded a former spouse survivor annuity. Id., Tab 14. OPM did not, however,
submit a definitive order from the state court, as ordered by the Board.
¶6 The Board determined that the rights and interests of the estate of the
appellant’s ex-husband could be affected by the decision in this case and afforded
the executor the right to participate in the appeal as an intervenor. Id., Tab 16.
The Board directed that, if the estate invoked its right to intervene, it then must
file an order from the state court declaring that the copy of the divorce decree
submitted by the appellant as the basis for her survivor annuity was invalid or
setting it aside. Id., Tab 17.
¶7 Subsequently, a daughter of Mr. Burns’ mother filed a motion to intervene
in the proceedings. Id., Tab 18. She explained that her mother had since died,
leaving her and her sister as heirs, that they had made a claim with OPM for
Mr. Burns’ retirement benefits in place of their late mother, that the estate of
Mr. Burns was closed, that she was seeking to qualify as the executor of her late
mother’s estate, and that her interests would be directly affected by the outcome
of these proceedings. She also explained that she had retained counsel to file an
action in the Circuit Court of Fairfax County, Virginia, seeking an Order of
Declaratory Judgment regarding the invalidity of the divorce decree submitted by
the appellant. Id. The Board granted the request to intervene 6 and ordered her to
6
The Board initially granted the daughter’s request to intervene only in her individual
capacity but afforded her an opportunity to file a supplemental pleading with evidence
6
file within 30 days an order from the state court declaring that the copy of the
divorce decree submitted by the appellant as the basis for her survivor annuity
was invalid or had been set aside. Id., Tab 20. The intervenors sought an
extension of time, documenting that their attorney had filed suit against the
appellant for fraud and a declaratory judgment, id., Tab 23 at 8-11, but explaining
that, due to the rules and procedures of the state court, they did not expect to be
able to obtain the state court order by the Board’s deadline, id. at 4-5. The Board
granted the extension. Id., Tab 24. The intervenors subsequently submitted an
Order signed by a judge of the Circuit Court of Fairfax County, Virginia,
sustaining the appellant’s claim that the fraud count was barred by the statute of
limitations but allowing the claim for a declaratory judgment to proceed. Id., Tab
25 at 47-48.
¶8 Following the Board’s granting of another extension of time, id., Tab 27,
the intervenors submitted a true certified copy of an Order signed by a judge of
the Circuit Court of Fairfax County, Virginia, after a hearing, finding that the
“alleged Final Decree of Divorce” that was “allegedly certified” by the court on
August 6, 2002 (the copy originally submitted to OPM by the appellant), “is not a
true and accurate copy of this court’s true Order,” and that the Final Decree of
Divorce (the copy originally submitted by the executor of Mr. Burns’ estate, by
OPM during these proceedings, and by the intervenors) “is a true and accurate
copy of this Court’s final order and should be given full faith and credit and
enforced as an order of this Court.” Id., Tab 28 at 46-47, 58-61, 63-66. The
appellant replied, albeit late, and claimed, among other things, that she is entitled
to the annuity payment because the Circuit Court did not expressly find that her
relied-upon divorce decree was “invalid” and “did not overtly set [her divorce
decree] aside.” Id., Tab 29 at 3.
of her sister’s consent to her representing both of their interests, PFR File, Tab 20 at 3
n*, and she submitted such a pleading, id., Tab 22.
7
ANALYSIS
¶9 Part 838 of Title 5 of the Code of Federal Regulations addresses Court
Orders Affecting Retirement Benefits, and Subpart G of Part 838 sets forth the
procedures for processing court orders awarding former spouse survivor
annuities. The regulations specifically provide that an employee, retiree, or
person adversely affected by a court order who alleges that a court order is
invalid must prove the invalidity of the court order and may do so by submitting
to OPM a court order that declares invalid the court order submitted by the former
spouse. 5 C.F.R. § 838.724(a)(1). It is well established that state courts are
responsible for determining when court orders are invalid. 5 C.F.R. § 838.122(d);
see 5 C.F.R. § 838.101(a)(2) (disagreement between the parties concerning the
validity or the provisions of any court order must be resolved by the court).
¶10 In this case, the administrative judge found that the appellant was entitled to
the former spouse survivor annuity initially awarded her by OPM based on the
terms of a divorce decree, which dissolved her marriage to Mr. Burns,
notwithstanding the competing decree submitted by Mr. Burns’ mother, the same
decree now relied upon by the intervenors. In so doing, the administrative judge
erred because he lacked the authority to determine which court order was valid.
We acknowledge the lengthy litigation in which the parties have engaged since
OPM filed its petition for review. However, consistent with 5 C.F.R.
§ 838.724(a)(1), the intervenors now have submitted a court order that declares
invalid the decree submitted by the appellant. Contrary to the appellant’s claim,
the April 8, 2015 Circuit Court order explicitly states that her submitted decree
“is not a true and accurate copy” of the court’s divorce decree. PFR File, Tab 28
at 9. Moreover, the court order declares valid the competing decree, which favors
the intervenors. Id..
¶11 Under these circumstances, because the administrative judge relied upon the
divorce decree that the appellant submitted, now found to be invalid, in
determining that there was no overpayment, we must vacate his finding and
8
affirm OPM’s reconsideration decision finding that, because the appellant was not
eligible for the former spouse survivor annuity she received, she was, in fact,
overpaid. Nonetheless, OPM bears the burden of proving not only the existence,
but also the amount, of an annuity overpayment by preponderant evidence.
Holbrook v. Office of Personnel Management, 105 M.S.P.R. 520, ¶ 6 (2007); see
5 C.F.R. § 831.1407(a).
¶12 Recovery of an overpayment may be waived when the annuitant proves by
substantial evidence that she is without fault and recovery would be against
equity and good conscience. 5 U.S.C. § 8346(b); Bacani v. Office of Personnel
Management, 64 M.S.P.R. 588, 594-95 (1994), overruled on other grounds by
Conner v. Office of Personnel Management, 120 M.S.P.R. 670 (2014). A
recipient of an overpayment is without fault if she performed no act of
commission or omission that resulted in the overpayment. 5 C.F.R. § 831.1402.
The pertinent considerations in finding fault are as follows: (1) whether payment
resulted from the individual’s incorrect, but not necessarily fraudulent statement,
which she should have known to be incorrect; (2) whether payment resulted from
the individual’s failure to disclose material facts in her possession which she
should have known to be material; or (3) whether she accepted a payment which
she knew or should have known to be erroneous. 5 C.F.R. § 831.1402(a)(1)-(3).
Certain factors may mitigate against finding fault. 5 C.F.R. § 831.1402(b).
¶13 Recovery is against equity and good conscience when it would cause
financial hardship to the person from whom it is sought, the recipient of the
overpayment can show, regardless of her financial circumstances, that, due to the
notice that such payment would be made, or because of the incorrect payment, she
either has relinquished a valuable right or changed positions for the worse, or
recovery could be unconscionable under the circumstances. 5 C.F.R. § 831.1403.
Financial hardship may be deemed to exist in, but not limited to, those situations
where the annuitant from whom collection is sought needs substantially all of her
current income and liquid assets to meet current ordinary and necessary living
9
expenses and liabilities. 5 C.F.R. § 831.1404. Similarly, inasmuch as the divorce
decree that the appellant submitted and upon which the administrative judge
relied has now been found to be invalid, we must vacate his alternative findings
that, even if the appellant were overpaid annuity benefits, she showed that she
was entitled to waiver of the overpayment because she was without fault and
because recovery would be against good conscience based on financial hardship.
¶14 Because resolving these issues may require credibility determinations that
are best first made by the administrative judge, we remand this appeal for further
adjudication. On remand, should he deem it necessary, the administrative judge
also should afford the appellant the opportunity to submit an updated Financial
Resources Questionnaire for consideration of her financial hardship claim. See
Zucker v. Office of Personnel Management, 114 M.S.P.R. 288, ¶ 9 (2010).
ORDER
¶15 For the reasons discussed above, we REMAND this case to the regional
office for further adjudication in accordance with this Remand Order. 7
FOR THE BOARD: ______________________________
William D. Spencer
Clerk of the Board
Washington, D.C.
7
To the extent that the intervenors have requested that the Board award them a survivor
annuity, there is nothing in the record indicating that OPM has issued or has refused to
issue a final decision providing the Board with jurisdiction over this claim. See Tatum
v. Office of Personnel Management, 82 M.S.P.R. 96, 99, ¶ 7 (1999) (the Board has
jurisdiction to adjudicate an individual’s rights and interests under CSRS only after
OPM has rendered a final or reconsideration decision on the issue in question). If,
however, the intervenors receive a final OPM decision on this claim and they disagree
with OPM’s determination, they may then file a new Board appeal of that decision with
the appropriate regional office.