Clary v. U.S., 02-5133.

• Decision Date: 24 June 2003
• Docket Number: No. 02-5133.,02-5133.
• Citation: 333 F.3d 1345
• Parties: Robert W. CLARY, Jr., Plaintiff-Appellee, v. UNITED STATES, Defendant-Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1345

333 F.3d 1345

Robert W. CLARY, Jr., Plaintiff-Appellee, v. UNITED STATES, Defendant-Appellant.

No. 02-5133.

United States Court of Appeals, Federal Circuit.

June 24, 2003.

William E. Cassara, of Evans, GA, argued for plaintiff-appellee.

Patrick T. Murphy, Trial Attorney, Commercial Litigation Branch, Civil Division, Department of Justice, of Washington, DC, argued for defendant-appellant. With him on the brief were Robert E. McCallum, Assistant Attorney General; David M. Cohen, Director; and James M. Kinsella, Deputy Director. Of counsel was Lt. Warren A. Record, Attorney, Department of the Navy, of Washington, DC.

Before BRYSON, GAJARSA, and DYK, Circuit Judges.

Opinion for the court filed by Circuit Judge GAJARSA. Concurring-in-part and dissenting-in-part opinion filed by Circuit Judge BRYSON.

GAJARSA, Circuit Judge.

In the present action, the United States appeals an order of the Court of Federal Claims ruling that Robert W. Clary, Jr. was illegally discharged from military service; correcting Mr. Clary's record to show that he was retired under 10 U.S.C. § 1186(b)(1); and granting Mr. Clary back pay and interest for the period between his separation and the time he was placed on retirement. Clary v. United States, 52 Fed.Cl. 390, 394 (2002). Because the Court of Federal Claims correctly determined Mr. Clary was entitled to retire under 10 U.S.C. § 1186(b)(1), but incorrectly granted Mr. Clary interest for the period between his separation and the time he was placed on retirement, we affirm-in-part and reverse-in-part.

I.

Mr. Clary joined the United States Navy on June 2, 1978 and remained on active duty until May 31, 1994. He achieved the rank of Lieutenant Commander in 1987. In 1990, Mr. Clary began an extra-marital relationship with the woman that is currently his wife. On January 29, 1991, as a result of this relationship, Mr. Clary received his first non-judicial punishment ("Mast") and a letter of reprimand for conduct unbecoming an officer.¹ Despite the first Mast, Mr. Clary continued this extra-marital relationship and on October 2, 1992, he received a second Mast for adultery and failure to obey an order. Following this second Mast, a Board of Officers convened and determined that sufficient evidence of misconduct and substandard performance existed to require Mr. Clary to "show cause" for retention in the Navy. Consistent with Navy procedures, a Board of Inquiry ("BOI") met in April 1993 and recommended Mr. Clary receive a general discharge from the Navy. A Board of Review met in August 1993 and upheld the finding and recommendation of the BOI.

While the BOI's recommendation was being reviewed, Mr. Clary failed for a second time to be promoted. In July 1993, Mr. Clary was notified that officers who had been passed over twice were required to be discharged within six months unless they applied and were accepted for continuation of active duty. On August 10, 1993, Mr. Clary spoke to his civilian personnel officer ("CPO"), Mr. Moffett, about continuation on active duty and his eligibility for early retirement. Mr. Moffett, in turn, spoke to a Lieutenant Biron, the Officer in charge of the Navy's Continuation Board Section and Mr. Clary's personal detailer, Lieutenant Commander Smith. Both Lieutenant Biron and Lieutenant Commander Smith told Mr. Moffett that Mr. Clary should be eligible for early retirement regardless of whether he was selected for continuation of his duties. Mr. Moffett relayed that information to Mr. Clary. Based on this information, Mr. Clary promptly applied for a continuation of active duty through August 1994.

In a letter dated October 22, 1993, the Navy notified Mr. Clary that he had been selected for continuation of active duty. Mr. Clary was also warned that he had been identified as an officer who should be required to show cause for retention, but that separation processing was not appropriate at that time. The Navy informed Mr. Clary that if he declined continuation, he would receive an Honorable Discharge and might be entitled to full separation pay or early retirement. Finally, the Navy warned Mr. Clary that if he elected to continue his service, he might receive a general or less than honorable discharge, receive an adverse separation code, and lose entitlement to retirement or separation pay. Despite these warnings, Mr. Clary accepted continuation of active duty on October 26, 1993.

In a February 18, 1994 letter, the Navy recommended that Mr. Clary receive a general discharge. He was subsequently discharged on May 31, 1994. Mr. Clary applied for a review of his discharge to the Board of Correction for Naval Records ("Board") on March 14, 1995. The Board denied Mr. Clary's petition on February 26, 1996, finding that the evidence did not establish the existence of material error or injustice.

While the Navy and Mr. Clary were addressing Mr. Clary's disciplinary issues, Congress, as a part of the National Defense Authorization Act for Fiscal Year 1993, enacted the Temporary Early Retirement Authority ("TERA"). Pub.L. No. 102-484, § 4403(a), 106 Stat. 2315 (1993). TERA provided the Secretary of Defense with a "temporary additional force management tool with which to affect the drawdown of military forces through 1995." Id. One of TERA's provisions gave the Secretaries of the military branches temporary authority to lower the number of years of service required for an officer to be eligible to retire from twenty to fifteen years.²

In July 1993, the Navy elected to utilize TERA to facilitate drawdown of the Navy's forces. To implement TERA, the Chief of Naval Operations issued Administrative Message ("NAVADMIN") 111/93 setting forth the eligibility requirements for TERA. NAVADMIN 111/93 stated as follows:

This NAVADMIN implements the Navy FY-94 15 year early retirement fleet reserve program for eligible officers and enlisted members. It is not an entitlement but a temporary early retirement authority (TERA), authorized until 30 Sep 95 to help facilitate personnel drawdown... TERA offers early retirement at a somewhat reduced monthly stipend to eligible [members] prior to completing twenty years active duty service. Officers and enlisted with at least 15 years active duty service between 1 Oct 93 and 30 Sep 94 may be eligible for TERA.... This voluntary offering is limited by competitive category/grade/rate/rating with caps for each.... Since TERA is not an entitlement, all eligible members may not be approved.

NAVADMIN 111/93 also specifically defined the officer eligibility requirements for TERA.

2. Officer Eligibility Requirements. Any officer, regular or reserve on the active duty list (ADL), with between 15 and 20 years of active duty, who is required to be separated for failure of selection (FOS) for promotion to the next higher grade may apply for TERA. These officers must have over 15 [years of service] before the date on which they would be required by law to be involuntarily separated from active duty. In addition to this broad category, only the following specific categories are eligible:

* * *

C. Lieutenant Commanders in the following categories only:

2. [Lieutenant Commanders] who have two or more FOS to 0-5, who will have between 15 and 20 [years of service] as of 30 Sep 94, will be required to apply for the early retirement program (to retire no later than 1 Sep 94).

(Emphasis added.)

Mr. Clary filed suit in the Court of Federal Claims on February 11, 1998. He sought a change of status from a general discharge to that of retirement with an honorable discharge with related financial benefits and record corrections. In particular, he alleged that 10 U.S.C. § 1186(b)(1) and TERA entitled him to retire in lieu of a discharge. Specifically, he argued that he was "eligible" for retirement under TERA, and therefore should have been retired, with benefits pursuant to 10 U.S.C. § 1186(b)(1).

The Court of Federal Claims agreed and determined that under 10 U.S.C. § 1186, Mr. Clary was entitled to a correction of his record to show that he was retired under 10 U.S.C. § 1186(b)(1) and that he receive back pay and interest for the period between his separation and the time he was placed on retirement.

The United States filed this appeal over which we have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3).

II.

The primary issue in this appeal is the interrelationship between 10 U.S.C. § 1186 and TERA. We must determine whether the Court of Federal Claims erred in interpreting 10 U.S.C. § 1186(b)(1) as mandating retirement of an officer under the provisions of TERA, a temporary force reduction tool. We review issues of statutory interpretation de novo. O'Connor v. United States, 308 F.3d 1233, 1239 (Fed.Cir.2002); Cathy v. United States, 191 F.3d 1336, 1338 (Fed. Cir.1999). To interpret a statute we first look to the statutory language and then to the legislative history if the statutory language is unclear. Allen v. Principi, 237 F.3d 1368, 1375 (Fed.Cir.2001); Rigsbee v. United States, 226 F.3d 1376, 1378-79 (Fed.Cir.2000); Madison Galleries, Ltd. v. United States, 870 F.2d 627, 629 (Fed.Cir.1989). We must first "determine whether the language at issue has a plain and unambiguous meaning with regard to the particular dispute in the case." Robinson v. Shell Oil Co., 519 U.S. 337, 340, 117 S.Ct. 843, 136 L.Ed.2d 808 (1997). "Our inquiry must cease if the statutory language is unambiguous and `the statutory scheme is coherent and consistent.'" Id.

A.

The pertinent statute which we need to interpret is title 10, section 1186(b) of the United States Code. It states:

An officer removed from active duty under section 1184 of this title shall — (1) if eligible for voluntary retirement under any provision of law on the date of such removal, be retired in the grade and with the retired pay for which he would be eligible if retired under such provision....

10 U.S.C. § 1186(b) (2000) (emphases added). One such "provision of law" is 10 U.S.C. §...