United States v. Larionoff

• Decision Date: 13 June 1977
• Docket Number: No. 76-413,76-413
• Citation: 431 U.S. 864,53 L.Ed.2d 48,97 S.Ct. 2150
• Parties: UNITED STATES et al., Petitioners, v. Nicholas J. LARIONOFF, Jr., et al
• Court: U.S. Supreme Court

431 U.S. 864

97 S.Ct. 2150

53 L.Ed.2d 48

UNITED STATES et al., Petitioners,

v Nicholas J. LARIONOFF, Jr., et al.

No. 76-413.

Argued April 27, 1977.

Decided June 13, 1977.

Syllabus

Respondent enlisted members of the United States Navy and others similarly situated, who agreed to extend their enlistments at a time when a statute provided for a Variable Re-enlistment Bonus (VRB), in addition to the Regular Re-enlistment Bonus (RRB), for members of the Armed Forces whose ratings were classified as a "critical military skill" held entitled to VRB's determined according to the award level in effect at the time they agreed to extend their enlistments, notwithstanding that the Navy eliminated their ratings from the "critical military skill" list before they began serving their extended enlistments, and that the statutes authorizing the RRB and VRB were repealed and a new Selective Re-enlistment Bonus (SRB) substituted before one of the respondents began to serve his extended enlistment. Pp. 869-882.

(a) Implementing regulations requiring that the amount of the VRB to be awarded to an enlisted member who extended his enlistment be determined by reference to the award level in effect at the time he began to serve his extended enlistment, rather than at the time he agreed to the extension, are invalid as being contrary to Congress' purpose, as manifested by the legislative history, in enacting the VRB program as an inducement to selected service members to extend their period of service. Whether a service member re-enlists or agrees to extend his enlistment, the VRB could only be effective as a selective incentive to extension of service if at the time he made his decision the service member could count on receiving it if he elected to remain in the service. Pp. 869-877.

(b) There is nothing in either the language or legislative history of the statute repealing the RRB and VRB system and establishing a new bonus system to show any intention on the part of Congress to affect the rights of those service members who had extended their enlistments and became entitled to receive VRB's. Pp. 878-882.

175 U.S.App.D.C. 32, 533 F.2d 1167, affirmed.

Keith A. Jones, Washington, D.C., for the petitioners.

Stephen Daniel Keeffe, Washington, D.C., for the respondents.

Mr. Justice BRENNAN delivered the opinion of the Court.

Seven enlisted members of the United States Navy brought this class action in the District Court for the District of Columbia under the Tucker Act, 28 U.S.C. § 1346(a)(2), alleging that their agreements to extend their enlistments, made at various times from 1968 to 1970, entitled each of them to payment of a re-enlistment bonus. The District Court ordered that the bonuses be paid, 365 F.Supp. 140 (1973), and the Court of Appeals for the District of Columbia Circuit affirmed. 175 U.S.App.D.C. 32, 533 F.2d 1167 (1976). We granted certiorari, 429 U.S. 997, 97 S.Ct. 522, 50 L.Ed.2d 607 (1976). We affirm.

I

From early in our history, Congress has provided by statute for payment of a re-enlistment bonus to members of the Armed Services who re-enlisted upon expiration of their term of service, or who agreed to extend their period of service before its expiration.¹ Prior to the enactment of Pub.L. No. 89-132, 79 Stat. 547 (1965), this bonus was determined for an enlistee's first re-enlistment or extension of enlistment by multiplying his monthly pay at the time of expiration of the initial period of service by the number of years specified in the re-enlistment agreement. See former 37 U.S.C. §§ 308(a), (b).

The perceived defect of this system was that "it failed to vary the monetary incentive for reenlistment according to the needs of the armed services for personnel with particular skills." 175 U.S.App.D.C., at 38, 533 F.2d, at 1173. Consequently, Congress enacted former 37 U.S.C. § 308(g), which authorized the services to provide, in addition to the Regular Re-enlistment Bonus (RRB) just described, a Variable Re-enlistment Bonus (VRB) to members of the Armed Services whose particular skills were in short supply. The VRB was to be a multiple, no greater than four, of the RRB.²

This program was in effect when respondent Nicholas J. Larionoff enlisted in the Navy for four years on June 23 1969.³ Shortly after his enlistment, Larionoff chose to participate in a Navy training program, completion of which would qualify him for the service rating "Communications Technician Maintenance" (CTM). At that time, as Larionoff was aware,⁴ the CTM rating was classified by Navy regulations as a "critical military skill," whose holders were eligible upon re-enlistment or extension of enlistment for payment of a a VRB in the amount of four times the RRB, the highest allowable rate. Before entering the training program, which entailed a six-year service obligation, Larionoff entered a written agreement to extend his enlistment "in consideration of the pay, allowances, and benefits which will accrue to me during the continuance of my service." Larionoff successfully completed the program and was advanced to the CTM rating, expecting to receive a VRB upon entering the period of his extended enlistment on June 23, 1973.⁵

On March 24, 1972, however, the Navy announced that effective July 1, 1972, the CTM rating would no longer be considered a "critical military skill" eligible for a VRB. When Larionoff, through his congressional representatives, inquired into his continued eligibility for a VRB, he was informed that since the CTM rating was no longer listed, he would not receive the expected bonus. Accordingly, in March 1973, respondents filed this lawsuit, and in September of that year the District Court certified a class and granted summary judgment for respondents, ordering payment of the disputed VRB's.

(1) While the Government's appeal of this order was pending in the Court of Appeals, Congress repealed the statutes authorizing both the RRB and the VRB, and substituted a new Selective Re-enlistment Bonus (SRB), effective June 1, 1974. Armed Forces Enlisted Personnel Bonus Revision Act of 1974, 88 Stat. 119, 37 U.S.C. § 308 (1970 ed., Supp. V). The Government concedes that this action had no effect on six of the named respondents; like Larionoff, they were scheduled to begin serving their extended enlistments prior to the effective date of the Act, and therefore should have received their VRB's, if at all, while the program was still in effect.⁶ Respondent Johnnie S. Johnson, however, first enlisted in the Navy in August 1970, and did not begin serving his extended enlistment until August 1974. The Court of Appeals was thus confronted with two questions: (1) whether Larionoff and those in his position were entitled to receive VRB's despite the Navy's elimination of their rating from the eligible list in the period after their agreement to extend their enlistments but before they began serving those extensions; and (2) whether Johnson and others in his situation were entitled to receive VRB's despite the repeal of the VRB program in the same period. The Court of Appeals held that both were entitled to receive VRB's.

II

A.

(2) Both the Government and respondents recognize that "(a) soldier's entitlement to pay is dependent upon statutory right," Bell v. United States, 366 U.S. 393, 401, 81 S.Ct. 1230, 1235, 6 L.Ed.2d 365 (1961), and that accordingly the rights of the affected service members must be determined by reference to the statutes and regulations governing the VRB, rather than to ordinary contract principles.⁷ In this case, the relevant statute, former 37 U.S.C. § 308(g), provided:

"Under regulations to be prescribed by the Secretary of Defense, . . . a member who is designated as having a critical military skill and who is entitled to (an RRB) upon his first reenlistment may be paid an additional amount not more than four times the amount of (the RRB)."

The regulations governing individual eligibility were set forth in Department of Defense Instruction 1304.15, P V.B.1 (Sept. 3, 1970).⁸

The Government contends that these eligibility criteria are to be applied as of the time the enlisted member completes service of his original enlistment and enters into the extended enlistment. This is a reasonable construction, since the statute requires that the VRB not be paid until that time. See n. 5, supra. At that time, it is argued, respondents did not satisfy two related criteria prescribed by P V.B.1, although it is conceded they met the others. First, they were not then "serving . . . in a military specialty designated" as a critical military skill, P V.B.1.a, since the CTM rating was by that time no longer so designate; second, they had not "(a)ttain(ed) eligibility prior to the effective date of termination of awards" for the CTM rating. P V.B.1.f.

The Government also relies upon the regulations governing the amount of the award to be received. Under Department of Defense Directive 1304.14, P IV.F (Sept. 3, 1970):

"When a military skill is designated for reduction or termination of award an effective date for reduction or termination of awards shall be established and announced to the field at least 90 days in advance. All awards on or after that effective date in military skills designated for reduction of award level will be at the level effective that date and no new awards will be made on or after the effective date in military skills designated for termination of awards." ⁹ (Emphasis added.)

Similarly, Department of Defense Instruction 1304.15, supra, P VI.A, stated:

"Members serving in a military specialty designated for reduction or termination of award under the provisions of subsection IV.F. of (Directive 1304.14, supra) will receive the award level effective on the date of their reenlistment or extension of enlistment, except at provided in paragraph V.B.l.f. above." ¹⁰

The Government argues that these regulations, read together, establish that respondents were entitled to receive only the VRB in...