Donnal S. Mixon v. Office of Personnel Management
Background
- Mixon was approved for FERS disability retirement effective August 2007; OPM warned him to apply for and report Social Security Disability Insurance (SSDI) benefits because FERS would be reduced by SSDI for the first 12 months.
- SSA approved Mixon for SSDI effective August 2007; Mixon alleges he notified OPM by phone but OPM has no record and did not offset his annuity.
- From Aug. 1, 2007 to Aug. 30, 2014 OPM later determined Mixon was overpaid $125,524 and denied his waiver request; Mixon appealed to the MSPB.
- Mixon obtained from his FEGLTD insurer reimbursement of most of the overpayment (about $118,384), but sought waiver/adjustment from OPM and then the Board.
- The administrative judge found OPM proved the overpayment, Mixon was without fault, but denied waiver/adjustment: he failed to show detrimental reliance or unconscionability and was required to set aside suspected overpayments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence & amount of overpayment | Mixon disputed calculation nuances but admitted amounts once OPM explained; sought insurer reimbursement | OPM proved amount by records and recalculation | OPM met burden; overpayment $125,524 proven |
| Waiver — without-fault element | Mixon argued he promptly informed OPM and was debilitated, so he was without fault | OPM agreed he was without fault (AJ so found) | Board affirmed he was without fault |
| Waiver — against equity & good conscience (detrimental reliance / tax burden) | Mixon said tax consequences and having received taxable FERS rather than nontaxable FEGLTD made waiver appropriate | OPM/Board: tax liability resulted from receiving an overpayment; recuperation from insurer is not controlling; Mixon could have monitored income or sought remedies | Denied waiver on detrimental reliance ground; tax consequences insufficient to show entitlement |
| Waiver — unconscionability / set-aside rule | Mixon argued delay by OPM (Jan–Sep 2014) and his medical condition made agency handling egregious and he lacked actual knowledge | OPM/Board: delay not egregious; Mixon had notice/instructions and suspected an overpayment so had duty to set funds aside; Policy Guidelines do not require actual knowledge | Denied partial waiver for unconscionability; set-aside rule applied and recovery not against equity and good conscience |
Key Cases Cited
- Slater v. Office of Personnel Management, 42 M.S.P.R. 510 (1989) (tax consequences from receipt of an overpayment do not necessarily support detrimental-reliance waiver)
- Day v. Office of Personnel Management, 873 F.2d 291 (Fed. Cir. 1989) (discusses waiver standard and tax consequences from retroactive awards)
- Parker v. Office of Personnel Management, 75 M.S.P.R. 688 (1997) (articulates waiver elements: without fault and against equity and good conscience)
- Vojas v. Office of Personnel Management, 115 M.S.P.R. 502 (2011) (defines standards for equity and good conscience, including unconscionability)
- Zucker v. Office of Personnel Management, 114 M.S.P.R. 288 (2010) (explains set-aside rule: those who know or suspect overpayments must set funds aside)
- Newcomb v. Office of Personnel Management, 42 M.S.P.R. 552 (1989) (delay alone does not establish unconscionability)
- Taylor v. Office of Personnel Management, 87 M.S.P.R. 214 (2000) (unconscionability is a high standard; waiver granted only in exceptional circumstances)