Rosa D. Bonewell v. United States

In the United States Court of Federal Claims

No. 08-745C

(Filed: May 29, 2013)

*************************************

ROSA D. BONEWELL, *

*

Plaintiff, *

*

v. * RCFC 52.1(c); Survivor Benefit Plan, 10

* U.S.C. §§ 1447-1455; Former Spouse

THE UNITED STATES, * Election; Office of Personnel Management

* v. Richmond; Substantial Compliance With

Defendant, * Statute and Regulations; Injustice; Bad

* Faith; Inducement

and *

*

CARMEN TITONG-BONEWELL, *

*

Defendant-Intervenor. *

*************************************

Chester H. Morgan, II, Colorado Springs, CO, for plaintiff.

John S. Groat, United States Department of Justice, Washington, DC, for defendant.

Patrick R. Quigley, Washington, DC, for defendant-intervenor.

OPINION AND ORDER

SWEENEY, Judge

In this case, plaintiff Rosa D. Bonewell, as the former spouse of a deceased United States

Air Force (“Air Force”) retiree, claims that she is entitled to annuity payments through the

military’s Survivor Benefit Plan (“SBP”). Defendant and defendant-intervenor, Carmen Titong-

Bonewell, the retiree’s widow, dispute plaintiff’s claim. In two earlier opinions, the court

concluded that it possesses jurisdiction over plaintiff’s claim for an SBP annuity and that plaintiff

has stated a claim upon which the court could grant relief.1 Now before the court is plaintiff’s

renewed motion for judgment on the administrative record. For the reasons set forth below, the

1

See Bonewell v. United States, 95 Fed. Cl. 752 (2010); Bonewell v. United States, 87

Fed. Cl. 413 (2009).

court denies plaintiff’s motion. In addition, the court sua sponte dismisses the remainder of

plaintiff’s complaint for lack of jurisdiction.

I. BACKGROUND

A. Statutory and Regulatory Framework

The SBP was enacted by Congress in 1972 to provide benefits to surviving spouses and

dependent children of deceased military retirees. Act of Sept. 21, 1972, Pub. L. No. 92-425, 86

Stat. 706 (codified as amended at 10 U.S.C. §§ 1447-1455 (2000)).2 In 1982, Congress expanded

the list of potential SBP beneficiaries to include former spouses. See Uniformed Services

Former Spouses’ Protection Act, Pub. L. No. 97-252, § 1003, 86 Stat. 706, 735-36 (1982). A

service member who is married or has dependent children at retirement is automatically enrolled

in the SBP unless he or she affirmatively elects not to participate. 10 U.S.C. § 1448(a)(2). The

retired pay of SBP participants is reduced in accordance with the type and number of designated

beneficiaries. Id. § 1452. Upon the death of an SBP participant, his or her beneficiaries receive

monthly annuity payments. Id. § 1450(a).

A former spouse can receive an SBP annuity through one of two methods: an election of

former spouse coverage pursuant to 10 U.S.C. § 1448(b) or a deemed election of former spouse

coverage pursuant to 10 U.S.C. § 1450(f)(3). Only the first method is at issue in this case.3 See

Bonewell, 95 Fed. Cl. at 726 & n.12. Under that method, the service member bears the burden of

making the election. 10 U.S.C. § 1448(b)(3)(A)(i). “Any such election must be written, signed

by the person making the election, and received by the Secretary concerned within one year after

the date of the decree of divorce, dissolution, or annulment.” Id. § 1448(b)(3)(A)(iii). Further:

2

Unless otherwise stated, all citations to 10 U.S.C. §§ 1447-1455 are to the 2000 version

of the United States Code, the law in effect when the relevant events in this case occurred.

3

Under the second method, a deemed election, the appropriate service must receive “[a]

written request, in such manner as the Secretary shall prescribe, from the former spouse

concerned requesting that such an election be deemed to have been made,” and either “a copy of

the court order, regular on its face, which requires such election or incorporates, ratifies, or

approves the written agreement” of the service member to make an election in favor of the

former spouse or “a statement from the clerk of court (or other appropriate official)” that the

agreement to make the election “has been filed with the court in accordance with applicable State

law.” 10 U.S.C. § 1450(f)(3)(A). The request must be received “from the former spouse . . .

within one year of the date of the court order or filing involved.” Id. § 1450(f)(3)(C). In this

case, plaintiff did not submit, prior to her former husband’s death, any documentation to the Air

Force that could constitute a request for a deemed election of former spouse coverage, such as a

written request, a copy of the separation agreement, or a copy of the Decree of Dissolution. See

Bonewell, 95 Fed. Cl. at 726 & n.12.

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A person who elects to provide an annuity to a former spouse . . . shall, at the time

of making the election, provide the Secretary concerned with a written statement

(in a form to be prescribed by that Secretary and signed by such person and the

former spouse) setting forth–

(A) whether the election is being made pursuant to the requirements of a

court order; or

(B) whether the election is being made pursuant to a written agreement

previously entered into voluntarily by such person as a part of, or incident

to, a proceeding of divorce, dissolution, or annulment and (if so) whether

such voluntary written agreement has been incorporated in, or ratified or

approved by, a court order.4

Id. § 1448(b)(5) (footnote added). The pertinent regulation setting forth the form of the required

written statement indicates that an Air Force retiree must submit DD Form 2656-1, Survivor

Benefit Plan (SBP) Election for Former Spouse Coverage, and a copy of the divorce decree to

elect coverage for a former spouse.5 Air Force Instruction 36-3006, supra note 4, at ¶ 3, Attach.

4

In contrast to the requirement in 10 U.S.C. § 1448(b)(5) that the “Secretary concerned”

prescribe the form of the written statement, 10 U.S.C. § 1455 requires the President to prescribe

SBP regulations. The President delegated this authority to the Secretary of Defense, see

Proclamation No. 11687, 37 Fed. Reg. 21479 (Oct. 12, 1972), who thereafter issued SBP

regulations, see Department of Defense Directive 1332.27, Survivor Benefit Plan (Jan. 4, 1974).

To implement Department of Defense Directive 1332.27, the Secretary of the Air Force issued

Air Force Policy Directive 36-30, Military Entitlements (Aug. 2, 1993), which in turn was

implemented by Air Force Instruction 36-3006, Survivor Benefit Plan (SBP) and Supplemental

Survivor Benefit Plan (SSBP) (Active, Guard, Reserve, and Retired) (July 1, 1996). Thus, the

requirements of both 10 U.S.C. § 1448(b)(5) and 10 U.S.C. § 1455 have been satisfied.

5

Rather than citing the relevant Air Force regulation, the parties cite the following:

United States Department of Defense Financial Management Regulation 7000.14-R, vol. 7B, ch.

43 (Sept. 1999) (“FMR”). With respect to the election of former spouse coverage under the SBP,

FMR section 430503 provides:

When a member elects former spouse coverage, the member and the former

spouse must complete an election statement indicating whether the election is

being made pursuant to the requirements of a court order or by a voluntary written

agreement. If the member entered into a voluntary written agreement as a part of,

or incident to, a proceeding of divorce, dissolution or annulment, the member

must indicate on the written statement whether the agreement has been

incorporated in, or ratified or approved by, a court order.

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14. Information to be provided on the DD Form 2656-1 includes the retiree’s name and social

security number; the former spouse’s name, birth date, and social security number; the dates of

marriage and divorce; and the signatures of both the service member and the former spouse. DD

Form 2656-1 (Apr. 1999).

B. Factual and Procedural History

On July 6, 1968, plaintiff married Technical Sergeant Rodney L. Bonewell (“TSgt

Bonewell”) in the Republic of the Philippines, where TSgt Bonewell was stationed with the Air

Force.6 Compl. ¶ 6; JA 12, 50. During the course of their thirty-two-year marriage, plaintiff and

TSgt Bonewell had two children: a son and a daughter. JA 98. TSgt Bonewell retired from

active duty on August 1, 1984, after twenty years of service. Id.; Compl. ¶ 6. Upon his

retirement, TSgt Bonewell elected to participate in the SBP, providing coverage for his children,

but not plaintiff. JA 29, 32. Subsequently, on March 31, 1993, TSgt Bonewell elected to

provide coverage for both plaintiff and their children. Id. at 98-100. His retired pay was reduced

accordingly. Compl. ¶ 6.

Plaintiff and TSgt Bonewell legally separated on October 27, 2000. JA 15-18. Then, on

May 10, 2001, they filed a pro se petition to dissolve their marriage. Id. at 13-14. The Decree of

Dissolution, which incorporated the prior separation agreement, was issued by the El Paso

County, Colorado District Court on May 11, 2001. Id. Paragraph eight of the separation

In addition, FMR section 430303 requires a service member to provide the following information

when making an election: the service member’s name, social security number, birth date, and

retirement date; the base amount of requested coverage; the former spouse’s name, social

security number, and birth date; the dates of marriage and divorce; and the signatures of both the

service member and the former spouse. The requirements described in the FMR generally

conform to the requirements set forth in the statute and relevant Air Force regulation.

6

Although the court included a comprehensive statement of facts in its November 4,

2010 Opinion and Order, it presents the facts again, with appropriate modifications, to provide a

backdrop for the current motion. The court derives the facts in this section from plaintiff’s

complaint (“Compl.”), the exhibits attached to the complaint (“Compl. Ex.”), the portion of the

joint appendix (“JA”) constituting the record before the Air Force Board for Correction of

Military Records (“AFBCMR”), and the two supplements to the AFBCMR’s record–the

supplemental appendix filed with the court on September 27, 2011 (“SA”), and the exhibit

attached to defendant’s June 18, 2012 status report (“Def.’s Ex.”). Defendant’s exhibit is not

paginated; thus, the court uses the page numbers assigned by the court’s electronic filing system

in its citations. Moreover, any facts derived solely from the complaint or the exhibits attached to

the complaint are included only to form a complete narrative, and will not be used as a basis for

ruling on plaintiff’s renewed motion for judgment on the administrative record. See Walls v.

United States, 582 F.3d 1358, 1368 (Fed. Cir. 2009) (indicating that “review of a military

corrections board is limited to the administrative record”).

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agreement provided: “The pension and retirement accounts will be divided as follows: Wife

shall receive $472.54 per month of Husband’s Air Force Retirement and SSP [sic] benefits.” Id.

at 16. Accordingly, on May 16, 2001, TSgt Bonewell submitted DD Form 2558, Authorization

to Start, Stop or Change an Allotment, to the Defense Finance and Accounting Service

(“DFAS”), requesting that plaintiff receive a monthly allotment of $472.54 from his retired pay.

Id. at 95. On the form, TSgt Bonewell indicated that the allotment was being made pursuant to a

“court ordered divorce settlement,”7 id., and the evidence reflects that TSgt Bonewell submitted a

portion of the Decree of Dissolution with his DD Form 2558. Specifically, TSgt Bonewell

attached to his DD Form 2558 a copy of the notice setting the final hearing on the dissolution and

a copy of the page from the separation agreement containing paragraph eight.8 Id. at 95-97

(containing the three pages); accord id. at 32 (containing a February 9, 2004 advisory opinion

from the Office of the Judge Advocate General indicating that TSgt Bonewell submitted the

Decree of Dissolution/separation agreement to the DFAS); SA 67-69 (containing the three pages,

each bearing the same unique identifier (i.e., “LKY3070300375”) and a consecutive page

7

Despite this notation suggesting that he was no longer married, TSgt Bonewell’s retired

pay continued to reflect a deduction for SBP spouse coverage. JA 67.

8

In 2006, the Air Force claimed, in contrast to its earlier position, that “[a]lthough the

allotment request form acknowledges the divorce decree, [it had] no basis to know whether

Rodney Bonewell submitted a full or partial copy of his divorce decree and separation agreement

along with the allotment authorization.” JA 93 (containing a July 31, 2006 advisory opinion

from the DFAS). According to the DFAS:

[T]he copy of the member’s DD 2558 . . . was entered into DFAS’[s]

computerized records on July 3, 2003, and was copied into the pay system along

with two random pages from [the] divorce proceedings in Colorado. . . . We have

no basis to know whether these two pages from different parts of [the] divorce

proceeding were submitted by the member along with the original allotment

authorization or why these documents were imaged into the record over two years

after the allotment form was executed.

Id.; accord id. at 83 (containing a February 17, 2006 advisory opinion from the Office of the

Judge Advocate General); cf. id. at 83 n.7 (indicating that the DFAS informed the Office of the

Judge Advocate General that the “May 2001 voluntary allotment form appears in the DFAS

records ‘only because someone submitted it to DFAS in July 2003’”). Although defendant

recognized the conflicting nature of the evidence, it ultimately decided not to “‘contest that the

three pages in question were apparently received by DFAS in May 2001.’” Bonewell, 95 Fed.

Cl. at 755 n.4 (quoting defendant’s reply brief). Given this representation, the court expressed

concern in its November 4, 2010 Opinion and Order that at least two of the advisory opinions

solicited by the AFBCMR were based on a faulty premise–that the DFAS did not receive part of

the Decree of Dissolution along with the DD Form 2558–and resulted in the denial of a benefit to

plaintiff that TSgt Bonewell specifically agreed to and provided for in the Decree of Dissolution.

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designation (i.e., “Page 1 of 3,” “Page 2 of 3,” or “Page 3 of 3”) along the top of the page); see

also JA 97 (containing the page from the separation agreement on which paragraph eight has

been highlighted). The DFAS processed the DD Form 2558 and plaintiff began receiving a

monthly payment of $472.54. JA 93.

Although TSgt Bonewell reallocated a portion of his retired pay in conformance with the

Decree of Dissolution, he did not make a separate, specific request to the DFAS to change his

SBP coverage for plaintiff from “spouse” to “former spouse.” Id. at 83, 92-94. TSgt Bonewell

subsequently married defendant-intervenor on August 13, 2001. Id. at 116. He did not notify the

DFAS of his new marriage or attempt to change his election from plaintiff to his new spouse as

the proper recipient of the SBP annuity.9 Id. at 83, 94.

TSgt Bonewell died on April 29, 2003. Id. at 19. Thereafter, on May 27, 2003, plaintiff

submitted an application to receive the SBP annuity awarded to her pursuant to the Decree of

Dissolution, along with TSgt Bonewell’s death certificate.10 Id. at 83, 109-10. The DFAS denied

plaintiff’s application. In a June 19, 2003 letter, the London, Kentucky office of the DFAS

indicated that the “[r]ecords on file at” that location showed that TSgt Bonewell “elected to

participate in the [SBP] . . . for spouse and child coverage” and that because plaintiff was “not

married to Mr. Bonewell at the time of his death,” it was denying her application for the SBP

annuity. Id. at 24. Consequently, when the DFAS received an application for the SBP annuity

from defendant-intervenor in July 2003, appended to which was a copy of the Decree of

Dissolution, it granted the application and began making monthly annuity payments to her.11 Id.

at 83, 116-17.

9

In contrast, TSgt did take such steps with his subsequent employer. After retiring from

the military, TSgt Bonewell entered civilian employment with the Air Force. JA157, 159; SA

64. On September 24, 2001, he advised the United States Office of Personnel Management that

he had divorced in May 2001 and remarried in August 2001. JA 156. Subsequently, in

November 2001, he began submitting the forms and supporting documents necessary to

designate defendant-intervenor as his beneficiary to receive his Federal Employees’ Retirement

System death benefit and the proceeds of his Federal Employee Group Life Insurance policy. Id.

at 157-63.

10

Plaintiff also submitted a claim for unpaid compensation. JA 111-12. In a June 14,

2003 letter, the Cleveland, Ohio office of the DFAS indicated that because the “[r]ecords on file

at” that location showed that TSgt Bonewell “designated a beneficiary to receive unpaid

compensation due upon his/her death,” it was denying plaintiff’s “claim for arrears . . . .” Id. at

108.

11

Defendant-intervenor had previously called the DFAS to inquire about the SBP

annuity on May 9, 2003. JA 83.

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Plaintiff ultimately retained an attorney, who, in an October 2, 2003 letter to the DFAS,

sought reconsideration of the June 19, 2003 denial. Id. at 22-23. The DFAS responded on

October 6, 2003, as follows:

A spouse loses eligibility as an SBP beneficiary upon divorce. It is important to

know that there is no provision in the SBP, which makes former spouse coverage

an automatic benefit. The only means by which the divorced spouse may receive

a survivorship annuity is if former spouse coverage is elected/deemed in writing

within one year of divorce. A court order cannot, by itself, be used to institute

coverage. The service member must submit a signed election request, before

coverage can be established.

You divorced the member on May 11, 2001. The former spouse and the

member had until May 11, 2002 to inform DFAS-Cleveland of the divorce and

state your deemed election as former spouse to continue the SBP coverage.

Our records do not reflect a written request from you or the service

member within one year of your divorce date. Therefore, you are not an eligible

beneficiary for SBP, effective May 11, 2001.

Id. at 25.

On November 14, 2003, plaintiff submitted an Application for Correction of Military

Records to the AFBCMR in a further attempt to obtain the SBP annuity. Id. at 47-49. The

AFBCMR returned the application to plaintiff on December 12, 2003, explaining that it could

not “rule on a disputed claim to a benefit only one person can receive.” Id. at 26. Dissatisfied

with this response, on January 9, 2004, plaintiff entreated the Office of the Judge Advocate

General directly for assistance. Compl. ¶ 10. As a result, the AFBCMR changed course and

decided to consider plaintiff’s application. Id.

The AFBCMR sought two advisory opinions. The first was prepared by the Air Force

Personnel Center on January 29, 2004. JA 67-68. It noted that the relevant law required an

election or deemed election of former spouse coverage within one year of a divorce. Id. at 67.

However, it found that there was “no evidence” that TSgt Bonewell requested that plaintiff’s

“SBP coverage be terminated following their divorce” and that “it would be inappropriate to

deny her an asset the court intended she receive.” Id. at 68. The Air Force Personnel Center

recommended that although there was “no evidence of Air Force error in this case,” TSgt

Bonewell’s military record should be corrected to reflect that on May 12, 2001, “he submitted a

valid election for former spouse and child coverage based on full retired pay, naming Rosa D.

Bonewell as the eligible beneficiary.” Id.

The second advisory opinion was prepared by the Office of the Judge Advocate General

on February 9, 2004. Id. at 63-65. After reiterating the applicable statutory law, it framed the

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relevant issue as “whether the filing of the divorce decree, which included the separation

agreement awarding the applicant SBP benefits, with DFAS meets the statutory requirements of

‘a written request, in such a manner as the Secretary shall prescribe . . . requesting that such an

election be deemed to have been made,’” such that a deemed election of former spouse coverage

could be established. Id. at 64 (quoting 10 U.S.C. § 1450(f)(3)(A)(i)). It concluded that based

upon the plain statutory language, as reinforced by two decisions from the United States Court of

Federal Claims (“Court of Federal Claims”), “the written request and court order are two

different items and the latter does not incorporate the former.” Id. at 64-65. Accordingly, the

Office of the Judge Advocate General recommended the denial of plaintiff’s application, noting

that plaintiff’s complaint was “with the estate of her former spouse and her only recourse [might]

be to bring suit against the estate or the person now receiving the SBP annuity.” Id. at 65.

Plaintiff responded to this latter advisory opinion on April 14, 2004. Id. at 36-38. In her

response, she distinguished the cited Court of Federal Claims cases, disputed the suggestion of an

available alternative remedy, and took issue with the lack of discussion of the AFBCMR’s

equitable powers. Id. In addition, she emphasized the extent to which an injustice had occurred

in her case. Id. Ultimately, plaintiff concurred with the conclusion of the Air Force Personnel

Center in the first advisory opinion that the interests of justice would be best served by correcting

TSgt Bonewell’s military record to reflect a timely election of former spouse coverage. Id. at 37-

38.

The AFBCMR issued its decision on October 14, 2004. Id. at 5-9. After reviewing the

underlying facts, the advisory opinions, and plaintiff’s response to the advisory opinions, it

concluded:

Insufficient relevant evidence has been presented to demonstrate the existence of

an error or an injustice. Through counsel the applicant essentially contends the

submission of the divorce decree to the [DFAS] was sufficient to change the SBP

spouse coverage to former spouse coverage. Counsel argues that by providing the

divorce decree, which incorporated the separation agreement, within one year of

its issuance[, she] satisfied the statutory “deemed election” written request

required of former military spouses pursuant to the law. However, after

thoroughly reviewing the evidence of record and the applicant’s submission, we

agree with the opinion and recommendation of the . . . Office of the Judge

Advocate General, in his memorandum of February 9, 2004, on the subject, and

adopt his rationale as the basis for our conclusion that the applicant has not been

the victim of an error or injustice. Specifically, the Chief notes by the statute’s

plain wording, the written request and the court order are two different items and

the latter does not incorporate the former. Therefore, in the absence of evidence

to the contrary, we find no compelling basis to recommend granting the relief

sought in this application.

Id. at 8-9.

-8-

Unsuccessful before the AFBCMR, plaintiff filed suit in the United States District Court

for the District of Colorado (“district court”) on July 19, 2005, seeking legal and equitable relief

under the Little Tucker Act, 28 U.S.C. § 1346 (2000). JA 71-79. Plaintiff alleged that the

AFBCMR’s denial of her claim was arbitrary, capricious, an abuse of discretion, and without

basis in law or fact. Id. After filing suit, plaintiff entered into settlement negotiations with

Assistant United States Attorney Kurt Bohn, who was coordinating with the Office of the Judge

Advocate General’s litigation division, represented by Lieutenant Colonel Joseph Wendelberger.

Compl. ¶ 14. Lieutenant Colonel Wendelberger suggested “that in view of recent cases coming

from” the Court of Federal Claims, were plaintiff to “voluntarily dismiss her suit from district

court[,] the AFBCMR would reconsider its earlier denial and [the Office of the Judge Advocate

General] would recommend relief.” Id. Based upon this representation, plaintiff voluntarily

dismissed her complaint in district court. Id. ¶ 15; JA 69-70. The Stipulation for Dismissal

indicated that the Air Force “agreed to reconsider” the AFBCMR’s denial of plaintiff’s

application “in light of the recent case law,” which took “into consideration the equitable factors

overlooked or not applied in the AFBCMR’s original decision.” JA 69-70.

On November 23, 2005, plaintiff resubmitted her claim to the AFBCMR. Id. at 43-46.

The AFBCMR again solicited an advisory opinion from the Office of the Judge Advocate

General, asking whether, in light of the new decisions from the Court of Federal Claims, the

Office of the Judge Advocate General would amend the position set forth in its February 9, 2004

advisory opinion. Id. at 81. The Office of the Judge Advocate General issued its advisory

opinion on February 17, 2006. Id. at 81-85. It determined, after consultation with the DFAS,

that the facts of the case appeared to be different from what it believed to be the case two years

previously. Id. at 82-84. Specifically, it rejected its previous belief that TSgt Bonewell had

submitted a copy of some or all of the Decree of Dissolution with his DD Form 2558, instead

asserting that it appeared that TSgt Bonewell’s widow first submitted the “divorce paperwork” to

the DFAS in July 2003 with her application to receive the SBP annuity. Id. at 83. Based upon

this new information, the Office of the Judge Advocate General suggested that the appropriate

inquiry was whether the AFBCMR should reconsider plaintiff’s application “when the member

submitted to DFAS a request for voluntary allotment to his former spouse referring to ‘court

ordered divorce settlement,’ but not attaching the court order or mentioning the SBP benefits.”

Id. at 82. However, the Office of the Judge Advocate General did not formally answer this

inquiry. Instead, it provided:

We believe that a discussion of the applicability of the two recent court

cases to this case is premature until a better factual record is established. If Rosa

Bonewell did not file any paperwork with DFAS until after her [ex-]husband’s

death, it seems to us that neither case would apply. Additionally, even if the

requisite paperwork was filed, it now appears that there is another interested party

in TSgt Bonewell’s SBP. If that turns out to be the case, the Board should request

an advisory opinion on the state of the law on the propriety of acting on the

applicant’s request.

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Id. at 85. Thus, the Office of the Judge Advocate General recommended that the AFBCMR

“reopen this matter to obtain an advisory opinion from DFAS to obtain documentary support for

the additional facts DFAS has provided this office and to establish a more accurate record upon

which to base the Board’s decision,” and represented that once the facts had been more clearly

established, it would “be happy to provide an opinion at that time on the state of the law

concerning the various issues in this matter.” Id. Plaintiff responded to this advisory opinion on

March 24, 2006, arguing that (1) the AFBCMR was bound by the record considered in rendering

its October 14, 2004 decision; (2) even if the new facts were true, the DFAS’s unilateral

changing of TSgt Bonewell’s beneficiary was improper; and (3) the equities still remained with

plaintiff. Id. at 87-91.

As suggested by the Office of the Judge Advocate General, the AFBCMR requested an

advisory opinion from the DFAS, which the DFAS issued on July 31, 2006. Id. at 92-94. As

alluded to in the Office of the Judge Advocate General’s advisory opinion, the DFAS reevaluated

the facts and determined that there was “no evidence that would substantiate Rosa D. Bonewell’s

claim . . . that the Decree of Dissolution and Separation Agreement were timely submitted to

DFAS in order that she begin receiving her portion of Rodney Bonewell’s retired pay.” Id. at 93.

Indeed, as noted above, the DFAS asserted that it had “no basis to know whether Rodney

Bonewell submitted” any part of the Decree of Dissolution or the incorporated separation

agreement prior to July 3, 2003, the date it contends that the DD Form 2558 and the two pages

from the dissolution proceedings were entered into its computerized records. Id. After this

supposed “clarifi[cation]” of the fact record,12 the DFAS opined that the Court of Federal Claims

decisions relied upon by plaintiff were distinguishable from plaintiff’s case. Id. at 94.

In light of the DFAS’s advisory opinion containing the putative “clarified” facts, the

AFBCMR requested another advisory opinion from the Office of the Judge Advocate General.

In its November 17, 2006 memorandum, the Office of the Judge Advocate General, incorporating

its February 9, 2004, and February 17, 2006 advisory opinions, concluded that where a “former

spouse wants her court-ordered SBP benefits, and the new spouse presumably believes she

remains entitled to the SBP benefits,” the AFBCMR was “not the proper forum . . . .” Id. at 125.

It explained:

While the AFBCMR is expected to honor unambiguous court orders timely filed

pursuant to federal law and may recognize undisputed court orders as evidence of

member intent, its role is not to construe or enforce court orders, reconcile

conflicting court orders and statutes, or decide, in effect, claims disputes between

two or more private parties.

12

The court notes that all of the “clarified” facts were known to the DFAS at the time

that plaintiff first filed her application to correct TSgt Bonewell’s military record with the

AFBCMR. Moreover, plaintiff avers that she was not provided with the records supporting these

“clarified” facts while the AFBCMR was first considering her application. Compl. ¶ 16.

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Id. at 13-14. Accordingly, it concluded that “[t]he AFBCMR should not consider cases involving

disputed claims unless a court of competent jurisdiction has ruled in the case or requires the

AFBCMR to make a determination in the case.” Id. at 14.

On March 5, 2007, plaintiff sent the AFBCMR two affidavits, one that she executed and

the other executed by her son. See Compl. Ex. 1 at 9-10 (reflecting that plaintiff’s counsel

forwarded the two affidavits to the AFBCMR); see also SA 64-66 (containing the affidavits).

Plaintiff’s affidavit was captioned as an “amended and supplemental affidavit,” and was intended

“to correct errors in some of the dates in [a] previous affidavit . . . and to supplement what [she

knew] about what was done to ensure that DFAS was on notice about the divorce and the

agreement that [she] was to get SBP.” SA 64. Her original affidavit, executed on March 15,

2006, provided:

Right after our divorce I started receiving the money we had agreed on

through an automatic deposit from DFAS. Because it was the correct amount and

started pretty much right after the divorce, I believed that Rodney had kept his

promise to send the right paperwork to Finance.

....

. . . I do not know what he sent in to DFAS when we were divorced, but

he knew that he was supposed to send in the divorce decree when we were

divorced, he promised me he’d do it, and when I started receiving the retired pay I

believed he had. I had no reason to believe otherwise.

Id. at 63. In her second affidavit, plaintiff stated:

I believed then and now that DFAS had a copy of the divorce decree. In

the first place, Rodney told me that he had sent everything in. He assured me that

I would get SBP, not just after the divorce, but again when we knew he was

terminal and I was taking care of him, he repeatedly assured me that he had made

sure I’d get SBP and that everything was in place.13

13

Plaintiff stated in her second affidavit that she, and not defendant-intervenor, was

caring for TSgt Bonewell because defendant-intervenor resided in the Philippines. SA 64. She

explained:

Unfortunately, my [then-]husband began going on the internet and met somebody

named Carmen. . . .

....

Before we were divorced, my husband had gone to the Philippines and

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Id. (footnote added). Plaintiff’s son confirmed her recollection:

In November of 2002 [my father] stayed with me at my residence, and the topic

came up. My dad told me that whatever happened he’d make sure that mom was

cared for, and that she was already getting part of his military retired pay and that

she’d get the Survivors Benefit Plan if he passed away. To the best of my

recollection his specific words were “Your mother will be getting my Air Force

retirement.” . . .

. . . . [A]round February of 2003, when he knew that he was probably

terminal, we talked about it again. My uncle, . . . (my dad’s brother), had been

asking me whether my mom would be okay financially when my dad died. . . .

Dad again repeated that there was nothing to worry about, that he had already

taken care of everything.

Id. at 66. The AFBCMR did not consider any of these three affidavits in ruling on plaintiff’s

application.14 See JA 171 (listing the exhibits considered by the AFBCMR); see generally id. at

1-172 (containing the administrative record, which does not include the affidavits).

On April 11, 2007, the AFBCMR forwarded to plaintiff two memoranda for review and

comment. Id. at 128. The first memorandum was prepared by the Air Force Deputy General

Counsel for National Security and Military Affairs on October 18, 2006, and contained “general

guidance” concerning the AFBCMR’s authority “to correct an error or remove an injustice in

cases where there are competing interests for [SBP] benefits.” Id. at 134. He explained:

actually met Carmen. He then returned to the Philippines after the divorce in

August 2001. Carmen did not return to the States with him. Rodney made

various trips to and from the Philippines, but in December of 2002 after he

returned he moved in with our son . . . . He became very ill the following spring

and the doctor told us that he was dying of lung cancer. Both children and I

stayed with him and tended to him. We tried to get Carmen, who continued to

live in the Philippines, to come to visit him, and finally she did come sometime in

March. He died on April 29, 2003.

Id. Defendant-intervenor indicated, in a May 1, 2007 letter she sent to the AFBCMR, that she

was unable to care for TSgt Bonewell because she was “waiting for [her] papers to enter . . . the

United States legally.” JA 153-54.

14

In fairness, there is no evidence before the court that the AFBCMR possessed

plaintiff’s original affidavit, and only extrarecord evidence that the AFBCMR possessed the

other two affidavits.

-12-

In our view, as a general proposition, the AFBCMR has the authority to

correct a record in an SBP case where it considers it necessary to do so to correct

an error or remove an injustice. In such cases, “deemed” elections may not

necessarily be outcome-determinative. Legal authority in this area must be

determined on a case-by-case basis . . . .

We have long maintained that the Board should exercise prudence when

the consequence of correcting a record may be unfavorable to another person.

While not a strict statutory prohibition, we nevertheless believe that in cases

where there are possible competing interests, there should be a rebuttable

presumption that no record correction should be made if the result would be

unfavorable to another person eligible to seek relief from the [AF]BCMR.

In such circumstances, the Board must carefully weigh the equities of the

competing interests (and we recommend each side be given the opportunity to

comment). Only in the most extraordinary of circumstances, where the Board

determines that equity demands a correction be made to remove an injustice, even

though such a correction may be unfavorable to another person, should the Board

make a correction.

Id. The second memorandum was an advisory opinion prepared by the Office of the Judge

Advocate General on October 19, 2006, for another case before the AFBCMR. Id. at 129-33. In

that case, the AFBCMR inquired whether a military record should be corrected to reflect SBP

coverage for a former spouse despite the DFAS having established the service member’s widow

as the SBP beneficiary. Id. at 129. Based on the incomplete facts it was provided, the Office of

the Judge Advocate General presumed that neither the service member nor the former spouse

“made a proper former spouse SBP election within a year” of the court order directing the

member to make the election, thus making the widow the “lawful SBP beneficiary” by operation

of law. Id. at 131. Based on this presumption, the Office of the Judge Advocate General

concluded that because the widow had “a vested interest in the SBP,” the former spouse could

not “summarily take away her lawful designation as an SBP beneficiary by seeking a correction

of the member’s military records.” Id. at 131-32. Moreover, it reiterated its contention that the

AFBCMR was not the proper forum to resolve such a contested case. Id. at 132. Ultimately, the

Office of the Judge Advocate General perceived no error or injustice that could be corrected by

the AFBCMR and suggested that the former spouse’s recourse existed elsewhere. Id.

The AFBCMR forwarded one final submission to plaintiff for her review and comment

on June 6, 2007: a May 1, 2007 letter, with attachments, from defendant-intervenor. Id. at 166;

see also id. at 152-65 (containing the letter and attachments). In her letter, defendant-intervenor

indicated that it was her position that she was the proper SBP beneficiary because the necessary

paperwork on plaintiff’s behalf was not submitted to the DFAS within the one-year time limit.

Id. at 152, 154. Based upon this letter, the AFBCMR “encouraged settlement” between plaintiff

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and defendant-intervenor, but defendant-intervenor “did not reply to Plaintiff’s repeated efforts to

contact her by mail and by e-mail.” Compl. ¶ 22.

The AFBCMR rendered its decision on plaintiff’s resubmitted application on March 20,

2008. JA 167-72. After summarizing the additional facts and advisory opinions added to the

record subsequent to its October 14, 2004 decision, with the exception of the affidavits of

plaintiff and her son, the AFBCMR concluded that there was “no evidence of an error warranting

corrective action in this case” and that it was not “persuaded by counsel’s assertions that the

applicant has been the victim of an injustice.” Id. at 170. In support of its conclusion, the

AFBCMR noted that there was no evidence of a timely, proper election of former spouse

coverage under the SBP and discounted the possibility that, upon the dissolution of his marriage,

TSgt Bonewell submitted the relevant portion of his Decree of Dissolution with his DD Form

2558. Id. Moreover, the AFBCMR concluded that “taking action ‘to preclude the possibility’ of

an injustice” to plaintiff would “create an injustice to another”–defendant-intervenor. Id. In

sum, the AFBCMR found that plaintiff had “failed to sustain her burden of proof regarding the

existence of an error or injustice” and that the intervening case law from the Court of Federal

Claims relied upon by plaintiff was distinguishable. Id.

Plaintiff filed the instant suit on October 20, 2008, asserting three claims for relief. In her

first claim, plaintiff avers that the AFBCMR’s decision denying her initial application was

arbitrary, capricious, and without a basis in law and fact. Compl. ¶¶ 24-26. In her second claim,

plaintiff contends that the AFBCMR’s decision denying her renewed application, after the Office

of the Judge Advocate General’s litigation division induced her to dismiss her district court

action by assuring her a favorable recommendation to the AFBCMR, was arbitrary, capricious,

contrary to law and equity, in bad faith, and an abuse of discretion. Id. ¶¶ 27-33. In her third

claim, plaintiff asserts that the Air Force acted in bad faith by inducing her to dismiss her federal

court action by assuring her a favorable recommendation to the AFBCMR. Id. ¶¶ 34-38. As

remedies, plaintiff seeks a declaration that she is the proper beneficiary of the SBP annuity; back

SBP annuity payments beginning from May 1, 2003; the correction of TSgt Bonewell’s Air Force

records to reflect that the DFAS was timely notified of the former spouse election; attorney’s

fees; and “[s]uch other and further relief as the Court deems just and proper under the

circumstances.” Id. ¶¶ (1)-(5).

On December 19, 2008, defendant moved to dismiss plaintiff’s complaint for lack of

jurisdiction pursuant to Rule 12(b)(1) of the Rules of the United States Court of Federal Claims

(“RCFC”). The court denied defendant’s motion in a May 26, 2009 Opinion and Order. See

Bonewell, 87 Fed. Cl. at 413. TSgt Bonewell’s widow subsequently intervened in the action.

She and defendant then moved to dismiss plaintiff’s complaint for failure to state a claim upon

which relief could be granted and the parties cross-moved for judgment on the administrative

record. In a November 4, 2010 Opinion and Order, the court denied all of the motions and

remanded the case to the AFBCMR for reconsideration of plaintiff’s application. Bonewell, 95

Fed. Cl. at 752. Specifically, the court directed the AFBCMR to

-14-

(1) obtain new advisory opinions that assume that TSgt Bonewell submitted part

of his Decree of Dissolution to the DFAS in May 2001 with his DD Form 2558;

(2) consider all of the evidence that was submitted by plaintiff, including her

affidavit and the affidavit of her son; (3) decide whether TSgt Bonewell

substantially complied with 10 U.S.C. § 1448(b) and explain why or why not; and

(4) decide whether, given the thirty-two-year marriage between plaintiff and TSgt

Bonewell and TSgt Bonewell’s specific intent to provide the SBP annuity to

plaintiff, equity demands a correction be made to remove an injustice to plaintiff,

and explain why or why not.

Id. at 769.

In compliance with the court’s remand order, the AFBCMR solicited a new advisory

opinion from the Air Force Review Boards Agency. The legal advisor for that agency

recommended in a February 28, 2011 advisory opinion that the AFBCMR should “find there was

not substantial compliance with 10 U.S.C., Section 1448(b),” and “advise the court that the

equities are in favor of the applicant, but that absent consent of the second spouse,” it “decline[s]

to correct the record under the authority of 10 USC 1552.” SA 51. Plaintiff submitted a

response to this advisory opinion on March 25, 2011, challenging the agency’s recommendations

that the AFBCMR should find that TSgt Bonewell did not substantially comply with 10 U.S.C.

§ 1448(b) and that the AFBCMR should decline to exercise its equitable power to correct TSgt

Bonewell’s military record. Id. at 53-62.

The AFBCMR did not follow the recommendations contained in the advisory opinion.

Rather, in a July 7, 2011 decision, it concluded that “[s]ufficient relevant evidence has been

presented to demonstrate the existence of an injustice warranting relief” because, it believed,

TSgt Bonewell’s “actions complied with the intent of the provisions of Title 10 U.S.C. 1448(b)

and clearly indicate[d] his desire to provide former-spouse SBP coverage for the applicant.” Id.

at 16. It gave “great deference” to the advisory opinion and recognized the existence of contrary

AFBCMR precedent. Id. It stated, however, that justice dictated that it rule in plaintiff’s favor,

and therefore recommended that TSgt Bonewell’s records be corrected “to show that on 12 May

2001, he elected to change his Survivor Benefit Plan (SBP) coverage from ‘spouse’ to ‘former-

spouse’ based on full retired pay, naming Rosa D. Bonewell as the eligible beneficiary.” Id. at

17. The recommendation of the AFBCMR panel was unanimous. Id.

Because the AFBCMR’s determination departed from the recommendation contained in

the advisory opinion, the record of proceedings was forwarded to the Assistant Secretary of the

Air Force for Manpower and Reserve Affairs for a final decision. See 32 C.F.R. § 865.4(l)

(2011) (requiring the record of proceedings to be forwarded to the Secretary of the Air Force or

his designee);15 Air Force Instruction 36-2603, Air Force Board for Correction of Military

15

This regulation went into effect on October 28, 2010. Personnel Review Boards, 75

Fed. Reg. 59,613 (Sept. 28, 2010) (to be codified at 32 C.F.R. pt. 865). Before that date, the

-15-

Records (Mar. 1, 1996) (same). In a July 18, 2011 memorandum, amended on August 1, 2011,

the Assistant Secretary declined to adopt the AFBCMR’s recommendation. SA 2-4. Instead, he

“decided to deny the application based upon [his] determination that granting it [was] not

appropriate and would not be consistent with prior decisions of the AFBCMR in similar cases.”

Id. at 4. He indicated that he did not “fully agree with the conclusions” reached by the

AFBCMR. Id. at 3. More specifically, he did not “agree that TSgt Bonewell’s actions complied

with the intent of the provisions of 10 U.S.C., Section 1448(b) and clearly indicate[d] his desire

to provide former-spouse coverage for the applicant,” and instead adopted the rationale contained

in the advisory opinion supporting the position that there was not substantial compliance. Id. at

2. The Assistant Secretary further noted that he did not agree with the AFBCMR’s

“determination that based upon the principles of equity, the AFBCMR should correct the record.”

Id. at 3.

The case then returned to the court for further proceedings. Plaintiff renewed her motion

for judgment on the administrative record and the other parties filed briefs in opposition. One of

the preliminary issues that emerged from the court’s review of the record and the parties’ briefs

was whether the Assistant Secretary was the appropriate official to review the AFBCMR’s

recommendation and issue a final decision rejecting that recommendation. Upon reviewing the

pertinent Air Force regulations in effect during the relevant time period, the court concluded that

in situations where the AFBCMR does not follow the recommendation contained in an advisory

opinion and unanimously recommends that the application be granted, only the Secretary of the

Air Force, and not the Assistant Secretary, could overrule the AFBCMR’s decision and deny an

application for the correction of military records.16 Accordingly, the court remanded the case to

the Air Force to allow the Secretary to render a decision.

The Secretary denied plaintiff’s application in a May 25, 2012 memorandum. Def.’s Ex.

5-6. In his decision, he determined that TSgt Bonewell did not substantially comply with the

requirements for electing former spouse coverage under 10 U.S.C. § 1448(b). Id. at 5. He then

determined that the case did not present a remediable injustice. Id. at 5-6. In summary, he

concluded that “the evidence presented in this case did not demonstrate the existence of a

material error or injustice.” Id. at 6.

The case again returned to this court for further proceedings. The parties filed

supplemental briefs and the court is now prepared to rule.

substance of this regulation was found at 32 C.F.R. § 865.4(p)-(q).

16

A detailed analysis of the relevant Air Force regulations can be found in the court’s

January 10, 2012 Order.

-16-

II. DISCUSSION

Plaintiff moves for judgment on the administrative record, seeking to overturn the

Secretary’s denial of her application for the correction of TSgt Bonewell’s military record to

reflect an election of former spouse coverage under the SBP. In ruling on such a motion, the

court makes “factual findings . . . from the record evidence as if it were conducting a trial on the

record.” Bannum, Inc. v. United States, 404 F.3d 1346, 1357 (Fed. Cir. 2005);17 see also id. at

1356 (“[J]udgment on the administrative record is properly understood as intending to provide

for an expedited trial on the administrative record.”).

A. Threshold Issues

1. Existence of a Claim

The court begins by addressing a threshold issue raised by defendant: whether the court

properly remanded the case to the AFBCMR to consider the issue of substantial compliance.

Relying on the decision of the United States Supreme Court (“Supreme Court”) in Office of

Personnel Management v. Richmond, 496 U.S. 414 (1990), defendant argues that the remand

was improper. In Richmond, a federal government employee incorrectly advised a retiree

regarding how much income he could earn before losing eligibility for disability retirement

benefits. Id. at 416. Based on this erroneous advice, the retiree earned more income than the

relevant statute allowed, leading to a six-month loss of his disability payments. Id. at 417-18.

The Supreme Court rejected the retiree’s argument that based on the faulty advice its employee

provided, the government was equitably estopped from withholding his disability payments. Id.

at 423-34. It explained that equitable estoppel could not be used to override the express terms of

the disability retirement statute, which specifically disallowed the benefits claimed by the retiree,

because the Appropriations Clause of the United States Constitution requires the payment of

money from the United States Treasury (“Treasury”) to be authorized by statute. Id.; see also id.

at 425 (“Any exercise of a power granted by the Constitution to one of the other branches of

Government is limited by a valid reservation of congressional control over funds in the

Treasury.”), 427-28 (noting that the “fundamental and comprehensive purpose” of the

Appropriations Clause “is to assure that public funds will be spent according to the letter of the

difficult judgments reached by Congress as to the common good and not according to the

individual favor of Government agents or the individual pleas of litigants.”), 432 (“[F]unds may

be paid out only on the basis of a judgment based on a substantive right to compensation based

on the express terms of a specific statute.”).

Defendant interprets Richmond to preclude plaintiff’s argument that TSgt Bonewell

substantially complied with the election requirements set forth in 10 U.S.C. § 1448(b), arguing

17

The decision in Bannum was based upon RCFC 56.1, which was abrogated and

replaced by RCFC 52.1. RCFC 52.1, however, was designed to incorporate the decision in

Bannum. See RCFC 52.1, Rules Committee Note (June 20, 2006).

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that because SBP annuities are paid from the Treasury, the Appropriations Clause requires strict

adherence to the election requirements. There is no dispute that TSgt Bonewell did not adhere to

the express terms of 10 U.S.C. § 1448(b) to elect former spouse coverage for plaintiff. As a

result, defendant contends, plaintiff could not have stated a claim for an SBP annuity for which

the court could grant relief, and the court therefore should not have remanded the case to the

AFBCMR to consider the issue of substantial compliance. The court disagrees.

As explained by the Supreme Court, to a survive an RCFC 12(b)(6) motion to dismiss, a

complaint must contain “enough facts to state a claim to relief that is plausible on its face.” Bell

Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). In other words, a plaintiff must “plead[]

factual content that allows the court to draw the reasonable inference that the defendant is liable

for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp.,

550 U.S. at 556). Plaintiff has met this pleading requirement for at least two reasons.

First, under the facts pleaded by plaintiff, the Appropriations Clause would not be

offended by amending TSgt Bonewell’s military record to reflect an election of former spouse

coverage. Congress has already authorized the payment of an SBP annuity to TSgt Bonewell’s

spousal beneficiary, whether that beneficiary is his widow or his former spouse. If TSgt

Bonewell’s military record was amended to reflect a former spouse election, no additional money

would be withdrawn from the Treasury; instead, payments to his widow would end and payments

to his former spouse would begin. This is not a case where allowing a claim for benefits would

result in the payment of money from the Treasury that would not have been paid at all if the

express terms of the statute were strictly applied.

Second, as the court discussed in its November 4, 2010 Opinion and Order, the United

States Court of Appeals for the Federal Circuit (“Federal Circuit”) continued to accept the

application of the substantial compliance doctrine post-Richmond in cases in which compliance

with the statute at issue was a prerequisite to a payment of money from the Treasury. For

example, the Federal Circuit recognizes that in tax refund suits, substantial compliance with

unimportant or confusing provisions in the relevant statutes or regulations may be sufficient,

even though such compliance is required to obtain the tax refund and that refund is payable from

the Treasury.18 See Credit Life Ins. Co. v. United States, 948 F.2d 723, 726-27 (Fed. Cir. 1991).

In addition, the Federal Circuit permitted contractors filing claims under the Contract Disputes

Act of 1978 (“CDA”) to substantially comply with the statute’s certification provision despite the

certification being required to recover damages from the government that were payable from the

Treasury.19 See, e.g., Fischbach & Moore Int’l Corp. v. Christopher, 987 F.2d 759, 760 (Fed.

18

Both tax refunds, 26 U.S.C. § 6402 (2012), and judgments against the government in

tax refund suits, 28 U.S.C. §§ 2414, 2517 (2012); 31 U.S.C. § 1304 (2012), are payable by the

Secretary of the Treasury.

19

The federal government pays its contractors from money appropriated by Congress.

See 31 U.S.C. § 1341(a)(1)(B) (prohibiting the award of a government contract before an

-18-

Cir. 1993); Heyl & Patterson, Inc. v. O’Keefe, 986 F.2d 480, 481 (Fed. Cir. 1993), overruled on

other grounds by Reflectone, Inc. v. Dalton, 60 F.3d 1572 (Fed. Cir. 1995); Transam. Ins. Corp.,

Inc. ex rel. Stroup Sheet Metal Works v. United States, 973 F.2d 1572, 1580 (Fed. Cir. 1992).

In its November 4, 2010 Opinion and Order, the court held that “a plaintiff who alleges

substantial compliance with 10 U.S.C. § 1448(b) has stated a claim upon which relief can be

granted.” Bonewell, 95 Fed. Cl. at 766. Upon further consideration, the court concludes that this

holding is too broad and should be limited to cases presenting factual circumstances similar to

those in this case; in other words, situations where the dispute concerns who should receive an

SBP annuity, and not whether a SBP annuity should be awarded in the first instance.

Accordingly, the court concludes that under the facts pleaded in this case, plaintiff has stated a

claim upon which relief could be granted.

2. Judicial Relief for an Alleged Injustice

Defendant raises a second threshold issue: whether the court can grant relief based on the

existence of an alleged injustice. Defendant argues that the court may only award monetary relief

authorized by statute, and therefore if a plaintiff in a military pay case is not statutorily entitled to

a particular benefit, the court lacks the authority to remand a case to a corrections board to

address an alleged injustice related to the denial of that benefit or review a decision by the

relevant military service that an injustice does not exist. Applying that argument to this case,

defendant asserts that because plaintiff cannot receive an SBP annuity based on the express

provisions of 10 U.S.C. § 1448(b), the court should not have remanded the case to the AFBCMR

to consider plaintiff’s allegation of injustice, and even if the remand was proper, the court cannot

review the Secretary’s determination that no injustice exists. Defendant’s argument is flawed.

Under 10 U.S.C. § 1552(a), the Secretary of the Air Force, acting through the AFBCMR,

may correct any military record of the Air Force when “necessary to correct an error or remove

an injustice.” If the Secretary denies an application for the correction of military records, and the

reversal of that decision would lead to a money judgment, then the applicant can contest the

decision in the Court of Federal Claims. See Strickland v. United States, 423 F.3d 1335, 1339

(Fed. Cir. 2005) (“Once the final decision issues, the service member may contest this final

agency action in a court.”); Sanders v. United States, 594 F.2d 804, 812 (Ct. Cl. 1979) (en banc)

(“A claim for back pay within our jurisdiction presents an appropriate occasion for reviewing the

actions of correction boards.”), superseded in nonrelevant part by statute, 10 U.S.C. § 628 (2000

appropriation is made). And, judgments against the federal government on CDA claims are

payable from the Judgment Fund, 41 U.S.C. § 7108(a) (2012) (citing 31 U.S.C. § 1304), which is

a permanent appropriation created “to satisfy judgments against federal agencies,” Bell BCI Co.

v. United States, 91 Fed. Cl. 664, 668 (2010). The Secretary of the Treasury and his designees

are responsible for disbursing appropriated funds from the Treasury to other executive agencies.

31 U.S.C. §§ 321, 3321-3322.

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& Supp. I 2002), as recognized in Richey v. United States, 322 F.3d 1317, 1323-24 (Fed. Cir.

2003).

The court’s review extends to determinations related to both alleged legal error and

alleged injustice, so long as the requested correction would result in a money judgment. See

Grieg v. United States, 640 F.2d 1261 (Ct. Cl. 1981) (“[T]he court cannot itself correct a simple

injustice or direct a correction board to do so, without the correction implementing a money

judgment.”); Sanders, 594 F.2d at 813 (“To recover for failure to correct an alleged injustice, . . .

it must be proved that such failure was . . . with monetary consequences.”). The decision of the

Federal Circuit in Murphy v. United States, 993 F.2d 871 (Fed. Cir. 1993), is not to the contrary.

In Murphy, the Federal Circuit noted:

[N]otwithstanding the language of 10 U.S.C. § 1552(a), invocation of the rubric

“injustice” provides no basis for judicial relief. There must be a “pure legal

error.” Section 1552(a) describes the Correction Boards’ jurisdiction to act on

behalf of the Secretary to “remove an injustice.” It says absolutely nothing about

the Claims Court’s jurisdiction which is circumscribed solely by the Tucker Act,

and which demands that the government be called upon to answer in money.

Absent that, there is no review in the Claims Court of alleged “injustice.”

993 F.2d at 874 (emphasis added) (footnote and citations omitted). In other words, the Court of

Federal Claims may review a failure to remove a purported injustice so long as the removal of

the injustice would require the payment of money.

Moreover, binding precedent does not reflect that this injustice-related payment of money

needs to be based on a strict adherence to the relevant statutory provision. For example, the

United States Court of Claims remarked in Sanders:

Whether the claim is based on legal error or material factual error, or

injustice amounting to such error, is thus immaterial in regard to our power to

review. It may be relevant, however, to the nature of proof necessary for plaintiff

to recover. . . . To recover for failure to correct an alleged injustice, such as

perhaps based on gross material error of fact or an action contrary to all evidence,

it must be proved that such failure was arbitrary and capricious, or in bad faith, or

contrary to law, or without rational basis, seriously prejudicial to plaintiff, and

with monetary consequences. In such event, the abuse of administrative

discretion rises to the level of legal error which merits judicial relief.

594 F.2d at 813 (footnote omitted); see also Yee v. United States, 512 F.2d 1383, 1387 (Ct. Cl.

1975) (“As this court has said before and reaffirms today, when a correction board fails to correct

an injustice clearly presented in the record before it, it is acting in violation of its mandate. And

such a violation, contrary to the evidence, is arbitrary and capricious.”).

-20-

In this case, there is no question that the correction of TSgt Bonewell’s military record to

remove the alleged injustice would result in the payment of money pursuant to a money-

mandating statute. Thus, the court is entitled to review the Secretary’s determination that no

remediable injustice exists in this case. For the same reason, it was proper for the court to

remand the case to the Air Force to make a new determination regarding plaintiff’s allegation of

injustice. In fact, upon determining that plaintiff stated a claim upon which the court could grant

relief in its November 4, 2010 Opinion and Order, the court was compelled to remand the case to

the AFBCMR because plaintiff submitted evidence with her complaint–affidavits–that were not

included in the administrative record considered by the AFBCMR or discussed in the

AFBCMR’s March 20, 2008 decision.20 Bonewell, 95 Fed. Cl. at 768-69 (citing Walls, 582 F.3d

at 1368). Because the AFBCMR had not rendered its March 20, 2008 ruling based on all of the

evidence that was likely before it, the court directed the AFBCMR to reevaluate plaintiff’s

application based on all of the evidence. Id. at 769. In doing so, it explained that the AFBCMR

should consider whether there was legal error (“the AFBCMR shall . . . decide whether TSgt

Bonewell substantially complied with 10 U.S.C. § 1448(b)”) or an injustice (“the AFBCMR shall

. . . decide whether, given the thirty-two-year marriage between plaintiff and TSgt Bonewell and

TSgt Bonewell’s specific intent to provide the SBP annuity to plaintiff, equity demands a

correction be made to remove an injustice to plaintiff”). Id. In other words, in its remand order

the court was merely instructing the AFBCMR to comply with 10 U.S.C. § 1552(a), which

permits the correction of military records when “necessary to correct an error or remove an

injustice,” and its implementing regulation, 32 C.F.R. § 865.4(h)(4), which requires the

AFBCMR to determine “[w]hether the applicant has demonstrated the existence of a material

error or injustice . . . .”

B. Plaintiff’s Renewed Motion for Judgment on the Administrative Record

Having disposed of the threshold issues raised by defendant, the court turns its attention

to the merits of plaintiff’s renewed motion for judgment on the administrative record. Due to the

AFBCMR’s decision not to follow the Air Force Review Boards Agency’s advisory opinion, the

court reviews the decision of the Secretary of the Air Force, which constitutes the final,

reviewable decision.21 See 32 C.F.R. § 865.4(l); see also Strickland, 423 F.3d at 1339 (holding,

20

According to a letter attached to the complaint but not later made part of the

administrative record, plaintiff’s attorney forwarded the two affidavits dated March 2, 2007, to

the AFBCMR on March 5, 2007. Compl. Ex. 1 at 9-10. In that letter, plaintiff’s counsel

indicated that the affidavit from plaintiff supplemented and superseded her earlier affidavit, id. at

9, implying that plaintiff’s first affidavit had also been submitted to the AFBCMR.

21

Plaintiff’s contention that the Secretary is not entitled to overrule the AFBCMR when

the court remands the case to the AFBCMR for reconsideration is without merit. The applicable

regulation does not distinguish between situations where the AFBCMR is considering an

application in the first instance or reconsidering an application on remand–in both cases the

-21-

under the regulations of the United States Navy, that if “the Secretary disagrees with the Board

and rejects its recommendation, then the Secretary must provide a written statement supporting

his rejection. In that case, the court reviews the decision on the basis of the Secretary’s written

statement.”). The Secretary’s decision is entitled to deference. Bray v. United States, 515 F.2d

1383, 1391 (Ct. Cl. 1975) (per curiam); see also Heisig v. United States, 719 F.2d 1153, 1156

(Fed. Cir. 1983) (noting that a court is not to substitute its judgment for that of a military service

“when reasonable minds could reach differing conclusions on the same evidence”); Sanders, 594

F.2d at 814 (holding that even if a court disagrees with a correction board’s conclusion “about

whether or not a specific situation was unjust, [it] will not substitute [its] judgment for the

board’s when reasonable minds could reach differing conclusions.”). Accordingly, the court may

only “review the rationale underlying the Secretary’s decision to determine if the decision was

arbitrary, capricious, unsupported by substantial evidence, or in violation of law.” Strickland,

423 F.3d at 1339; accord Boyd v. United States, 207 Ct. Cl. 1, 4 (1975) (“The court . . . may

reject the decision of a Secretary only if he has exercised his discretion arbitrarily, capriciously,

in bad faith, contrary to substantial evidence, or where he has gone outside the board record, or

fails to explain his actions, or violates applicable law or regulations.”).

1. Substantial Compliance

The Secretary addressed both substantial compliance and injustice in his May 25, 2012

decision. With respect to the issue of substantial compliance, he found:

TSgt Bonewell did not substantially comply with the requirements for making a

former-spouse election under 10 U.S.C. § 1448(b), for the reasons discussed in the

AFBCMR legal advisory opinion. In particular, the submission of a DD Form

2558, Permission to Start, Stop Or Change An Allotment, does not substantially

comply with the requirement to submit a written statement, signed by both parties,

in the form of a DD Form 2656, Survivor Benefit Plan (SBP) Election Statement

For Former Spouse. As their titles indicate, these two forms are used for specific

and entirely different purposes. Moreover, expressions of intent, however clear,

do not constitute substantial compliance with specific statutory and regulatory

decision of the AFBCMR is not a final decision when the AFBCMR does not follow the advice

set forth in an advisory opinion. See 32 C.F.R. § 865.4(l).

Further, plaintiff’s contentions that the Secretary is not entitled to overrule the AFBCMR

(1) without identifying any evidence in the administrative record demonstrating factual or legal

error made by the AFBCMR or (2) so long as the AFBCMR’s findings were justified by the

record are equally unavailing. Pursuant to 32 C.F.R. § 865.5(a), “[t]he Secretary may direct such

action as he or she deems appropriate on each case,” and is only required to issue a written

decision that includes “a brief statement of the grounds for his/her final decision.” There is no

requirement that the Secretary review the AFBCMR’s decision under a deferential standard;

rather, his review of the record of proceedings is de novo.

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requirements, especially given the clear and unambiguous requirement to submit a

DD Form 2656 in order to designate a former spouse as the beneficiary for SBP

benefits.22

Def.’s Ex. 5 (footnote added). In the advisory opinion referred to by the Secretary, the legal

advisor for the Air Force Review Boards Agency analyzed the substantial compliance issue, and

summarized his recommendation as follows:

I find a lack of substantial compliance in this case based upon: the missing DD

2656-1; the missing full court order; the quantity and nature of the required

information missing and the fact that there is no specific reference to requesting

ex-spouse SBP coverage in what TSgt Bonewell submitted. This is not a matter

of an uncrossed T, or undotted I, but significant missing statutory requirements,

(the written statement requirement and the requirement it be “signed by such

person and the former spouse”) as well as missing most of the information

requested in the manner that the statute said the Secretary was to proscribe [sic].

SA 49.

Plaintiff raises a number of objections to the Secretary’s discussion of substantial

compliance: (1) he did not address substantial compliance, only strict compliance; (2) he

improperly relied on the Air Force Review Boards Agency legal advisor’s “find[ing]” that TSgt

Bonewell did not substantially comply with 10 U.S.C. § 1448(b); (3) he did not explain how

congressional purposes would be undercut by TSgt Bonewell’s failure to strictly comply with 10

U.S.C. § 1448(b); and (4) he did not provide an independent analysis. Plaintiff’s objections

cannot be sustained.

The Secretary concluded that TSgt Bonewell did not substantially comply with the

requirements of 10 U.S.C. § 1448(b), for the reasons set forth in the advisory opinion. He then

expanded on that conclusion, explaining his primary problem with TSgt’s Bonewell’s

submission–that the submission of DD Form 2558 was insufficient to comply with the statute’s

requirement that a written statement signed by both the service member and the former spouse be

submitted to the Air Force on a DD Form 2656-1. The court finds no error in this aspect of the

Secretary’s decision.

The Secretary is only required to provide “a brief statement of the grounds” for his

decision. 32 C.F.R. § 865.5(a). He satisfied this requirement in two ways. First, he agreed with,

and incorporated, the reasoning set forth in the advisory opinion. Nothing in the relevant statutes

and regulations prohibit him from adopting the analysis of others. And, it is of no moment that

22

It is apparent from the Secretary’s discussion that he is referring to DD Form 2656-1,

Survivor Benefit Plan (SBP) Election for Former Spouse Coverage, and not DD Form 2656, Data

for Payment of Retired Personnel.

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the legal advisor used the word “find” in the advisory opinion; there is no indication that the

Secretary treated the advisory opinion as binding on him. Second, the Secretary explained why

in particular he believed that there was no substantial compliance in this case. That he did not

address every factor that might support a finding of substantial compliance–for example,

congressional intent–does not render his decision improper. To require the Secretary to address

every possible relevant factor is contrary to the prescription that his statement of the grounds for

his decision be brief.

In addition, contrary to plaintiff’s assertion, the Secretary did address substantial

compliance. As the Secretary noted, 10 U.S.C. § 1448(b) requires a written statement signed by

both the service member and the former spouse on a form he prescribes. His determination that

the documents submitted by TSgt Bonewell were insufficient to satisfy 10 U.S.C. § 1448(b)’s

requirements, as reflected in his decision and in the advisory opinion with which he agreed, is

entirely consistent with his conclusion of a lack of substantial compliance. Moreover, the

Secretary’s statement that clear expressions of intent do not constitute substantial compliance

does not signify that he was requiring strict, rather than substantial, compliance. He did not

declare that it was impossible for a service member to substantially comply with 10 U.S.C.

§ 1448(b)’s requirements, therefore leaving open the possibility that a finding of substantial

compliance might be proper if, for example, a service member submitted both the proper form

without the former spouse’s signature and a copy of the separation agreement containing the

signatures of both the service member and his former spouse.

Reviewing the Secretary’s decision, the court cannot conclude that he was incorrect to

find that TSgt Bonewell did not substantially comply with the relevant statute and regulations.

TSgt Bonewell’s submission was deficient in a number of ways, and the court would be hard-

pressed to find that the submission of a form relating to allotments, along with a page from a

separation agreement that briefly, and incorrectly, refers to the SBP, provided the Air Force with

adequate notice of an intent to elect former spouse coverage. Accordingly, for all of the reasons

stated above, the court finds that the portion of the Secretary’s decision directed at the issue of

substantial compliance is not arbitrary, capricious, unsupported by substantial evidence, or in

violation of law.

2. Injustice

On the issue of injustice, the Secretary found:

I have considered all of the evidence submitted by Ms. Rosa Bonewell, including

her affidavit and the affidavit of her son, and determine that a correction is not

appropriate to remove an injustice in this case. Congress has created specific

requirements for SBP elections, and here there was no compliance or substantial

compliance with those requirements. Consequently, I have determined that

entitlement to TSgt Bonewell’s SBP annuity vested in his widow at the time of his

death–Ms. Carmen Titong-Bonewell–and not in his former spouse, Ms. Rosa

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Bonewell. In making this decision, I took into account the fact that a decision

either way would be to the disadvantage of one of the former spouses of TSgt

Bonewell. Under these circumstances, my obligation is to determine whether

there is an injustice that should produce a different result. I’ve determined under

the facts of the case that a decision either way would create an injustice of denying

one of the former spouses of TSgt Bonewell of the payment of the SBP annuity.

While I agree with the AFBCMR panel that certain equities lie with Ms. Rosa

Bonewell, correcting the record as Ms. Rosa Bonewell asks would necessarily

entail vacating Ms. Carmen Titong-Bonewell’s legal entitlement to TSgt

Bonewell’s SBP annuity. Such a correction would create an injustice for Ms.

Carmen Titong-Bonewell under the law.

Def.’s Ex. 5-6. Plaintiff contends that this analysis is faulty in three respects: (1) the Secretary

improperly rested his decision on policy grounds external to the administrative record; (2) the

Secretary did not balance the equities as between plaintiff and defendant-intervenor; and (3) it

was improper for the Secretary to determine that when there are competing interests, an injustice

that would be suffered by an individual who would lose the benefit to which she was legally

entitled cancels out the injustice that the other individual would suffer through not receiving a

benefit that she might be entitled to on equitable grounds.

The court can easily dispose of plaintiff’s first two objections. First, the Secretary does

not indicate that he based his decision on general policy grounds; his discussion relates solely to

the facts and equities in this case. And even if he did base his decision on policy grounds, he

would have been entitled to do so, so long as he provided an adequate explanation. Hertzog v.

United States, 167 Ct. Cl. 377, 387 (1964). Second, although the Secretary did not specifically

enumerate the various equities involved, it is clear from his decision that he took them under

advisement. Moreover, he was not required to provide a detailed and expansive decision, but

only a “a brief statement of the grounds for his[] final decision.” 32 C.F.R. § 865.5(a).

Plaintiff’s third objection also lacks merit. There is no doubt that plaintiff has suffered,

and continues to suffer, from the operation of a statutory scheme that punishes former spouses

who are entitled to a SBP annuity pursuant to a divorce decree and, due to the amicable nature of

the divorce and the repeated assurances of the retiree, have no reason to suspect that the retiree

did not file the proper paperwork. While the SBP statute allows individuals like plaintiff to

protect themselves by seeking a deemed election of former spouse coverage, there is no

mechanism for advising them of this right, even if the relevant military service has been made

aware of the divorce through other means. As the Secretary remarked, there are equities that lie

with plaintiff.

Nevertheless, the Secretary was also correct in noting that defendant-intervenor would

suffer from an injustice if he corrected TSgt Bonewell’s military record to reflect an election of

former spouse coverage. Defendant-intervenor was TSgt Bonewell’s spouse at the time of his

death, and because TSgt Bonewell neither strictly nor substantially complied with the provisions

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of 10 U.S.C. § 1448(b) to change his SBP coverage from “spouse” to “former spouse,” she was,

by operation of law, the proper beneficiary of the SBP annuity. The Secretary has the discretion

to correct a military record to remove an injustice, but he also has the discretion to weigh the

effect that the proposed correction might have on others. Indeed, it will be a “comparatively

rare” case in which the failure to remove an alleged injustice rises “to the level of legal error

which merits judicial relief.” Sanders, 594 F.2d at 813. This is likely “because the proof must

overcome the strong, but rebuttable, presumption that administrators of the military, like other

public officers, discharge their duties correctly, lawfully, and in good faith” and “[s]trong

policies compel the court to allow the widest possible latitude to the armed services in their

administration of personnel matters.” Id.; accord Dodson v. U.S. Gov’t, Dep’t of the Army, 988

F.2d 1199, 1204 (Fed. Cir. 1993) (“[M]ilitary administrators are presumed to act lawfully and in

good faith . . . , and the military is entitled to substantial deference in the governance of its

affairs.”). Accordingly, the court concludes that the Secretary’s decision not to remove the

injustice alleged by plaintiff does not rise “to the level of legal error which merits judicial relief.”

Sanders, 594 F.2d at 813. In other words, the portion of the Secretary’s decision directed at the

issue of injustice is not arbitrary, capricious, unsupported by substantial evidence, or in violation

of law.

C. Bad Faith and Inducement

As noted above, plaintiff asserted three claims for relief in her complaint. The court’s

determination that the Secretary’s decision should be upheld disposes of plaintiff’s first two

claims, which concern the AFBCMR’s earlier denials of her applications for the correction of

military records. Plaintiff’s third claim for relief, however, does not contain a challenge to an

AFBCMR decision. Rather, plaintiff contends that the Air Force acted in bad faith by inducing

her to dismiss her district court action by assuring her a favorable recommendation to the

AFBCMR. The court lacks jurisdiction to adjudicate allegations of bad faith as they sound in

tort.23 See, e.g., Minehan v. United States, 75 Fed. Cl. 249, 259 (2007) (“[T]he law is clear that

allegations regarding bad faith or fraudulent actions by government officials or agencies do

sound in tort.”); Franklin Savs. Corp. v. United States, 56 Fed. Cl. 720, 731 (2003) (“[T]o the

extent that Franklin alleges the appointment of the conservator was made in bad faith, those

claims were ones sounding in tort over which this court has no jurisdiction . . . .”); Richards v.

23

The court may only entertain allegations that the final administrative decision maker,

here the Secretary of the Air Force, acted in bad faith in rendering his decision. See, e.g., Heisig,

719 F.2d at 1156 (“‘[R]eview of the administrative decision is limited to determining whether the

. . . action was arbitrary, capricious, or in bad faith, or unsupported by substantial evidence, or

contrary to law, regulation, or mandatory published procedure of a substantive nature by which

[the complainant] has been seriously prejudiced.’” (quoting Clayton v. United States, 225 Ct. Cl.

593, 595 (1980))); Boyd, 207 Ct. Cl. at 4 (“The court . . . may reject the decision of a Secretary

only if he has exercised his discretion arbitrarily, capriciously, in bad faith, contrary to substantial

evidence, or where he has gone outside the board record, or fails to explain his actions, or

violates applicable law or regulations.”).

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United States, 20 Cl. Ct. 753, 758 (1990) (“Finally, plaintiff’s Complaint suggests that the

District Court and other government employees acted fraudulently and in bad faith in their

dealings with him. [S]uch claims sound in tort and as such also are clearly outside the

jurisdiction of the United States Claims Court.”). Nor does the court have jurisdiction to

entertain claims of fraudulent inducement, which also sound in tort. See, e.g., Aetna Cas. & Sur.

Co. v. United States, 655 F.2d 1047, 1059 (Fed. Cir. 1981) (holding that inducement is a claim

sounding in tort that is beyond the court’s Tucker Act jurisdiction); Phang v. United States, 87

Fed. Cl. 321, 325 (2009) (“[T]his court has no jurisdiction under the Tucker Act to hear

plaintiff’s claims for fraud, fraud in the inducement, and breach of contract. . . . Plaintiff’s

claims for fraud and fraud in the inducement sound in tort.”), aff’d, 388 F. App’x 961 (Fed. Cir.

2010) (unpublished decision). Accordingly, the court must dismiss plaintiff’s third claim for

relief for lack of jurisdiction.

III. CONCLUSION

For the reasons set forth above, the court DISMISSES plaintiff’s third cause of action for

lack of jurisdiction, and DENIES plaintiff’s renewed motion for judgment on the administrative

record. No costs. The clerk is directed to enter judgment for defendant and defendant-

intervenor.

IT IS SO ORDERED.

s/ Margaret M. Sweeney

MARGARET M. SWEENEY

Judge

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