Malcolm v. United States and the Pitfalls of Federal Litigation in Military Records Correction Board Cases
Last week, the United State Court of Federal Claims issued a decision dismissing a complaint in Malcolm v. United States, No. 16-545C (Ct. Cl. Jan. 11, 2017). It was an easy case for the court to dispatch and because it was unpublished, it lacks precedential weight. But its discussion of the applicable law provides a great illustration of the jurisdictional nuances and common pitfalls that often doom those seeking relief before military record-correction boards and the Court of Federal Claims. Most cases that suffer the same fate are pro se cases (those brought without legal counsel), but many attorneys make these mistakes.
The underlying facts of Mr. Malcolm’s case are quite common. Before completing basic training, he was separated from the Navy with an adverse discharge despite possibly having an unfitting mental health condition that wasn’t diagnosed until after his discharge. His DD 214 discharge document reflected that he was separated “under other than honorable conditions” based on “misconduct” as a result of two disciplinary actions and a negative performance evaluation. However, during his time at basic training, he had made repeated visits to the ship’s medical personnel for dizziness, recurrent headaches, confusion, and severe stress. In 2013, he was diagnosed with Bipolar I disorder by two separate psychologists, one of which noted that Mr. Malcolm had suffered “longstanding symptoms of mania and [that] he [was] vulnerable to stressors.”
In 2014, Mr. Malcolm applied pro se to the Naval Discharge Review Board (NDRB), requesting that his discharge be upgraded to honorable on grounds that his then-undiagnosed mental health condition caused him to violate Navy rules. The NDRB denied his application and Mr. Malcolm then applied to the Board for Correction of Naval Records (BCNR) seeking the same relief, asserting similar arguments. The BCNR denied his application in July 2015.
Mr. Malcolm filed suit in the United States Court of Federal Claims (CFC) in May 2016 and amended his complaint in June 2016. He alleged that he was unlawfully discharged and sought an order correcting his discharge and “monetary compensation for $1,000,000 . . . for legal employment compensation, medical retirement pay, disability benefits[,] and any and all other legal[l]y mandated compensation.” The Court construed Mr. Malcolm’s complaint as asserting claims for wrongful discharge under the Military Pay Act and for disability retirement pay under 10 U.S.C. § 1201. The Court dismissed both claims for lack of jurisdiction. The Court’s decision illustrates a number of important pitfalls that generally could be avoided if the applicant or his counsel is aware of some key principles.
Unlawful discharge claims made under the Military Pay Act accrue on the date of discharge regardless of date a military record correction board issues a decision.
Established by The Tucker Act, the Court of Federal Claims is a court of limited jurisdiction as it waives the government’s sovereign immunity only to allow claims for money damages. Despite common misconception, the CFC does not have jurisdiction over tort claims, Administrative Procedure Act claims, and many other common sources of jurisdiction typically brought in federal district courts against the U.S. Government. Further, as the Malcolm court explains very well, the Tucker Act Does not confer any substantive rights so a plaintiff must assert an independent source of a substantive right of money or a “money-mandating” statute. For unlawful discharge cases, this statute is the Military Pay Act.
Military Pay Act claims are subject to a six-year statute of limitations that begins to toll on the date “such claim accrues.” 28 U.S.C. § 2501. It is a long-held rule in the CFC that, absent extraordinary circumstances the court is exceedingly unlikely to find, the date of accrual for unlawful discharge claims is the date of discharge. This rule often creates a bit of confusion for military-separation cases because plaintiffs typically begin challenging their involuntary separation at a military records-correction board under 10 U.S.C. § 1552. Indeed, records-correction boards do have the authority to overturn a separation and make corrections that might entitle a service member to back pay. But the Federal Circuit has deemed § 1552 applications to be permissive rather than mandatory remedies and, as such, they do not toll the statute of limitations for Military Pay Act claims. See Martinez v. United States, 333 F.3d 1295, 1307 (Fed. Cir. 2003). Military records-correction board decisions still can be reviewed by the CFC as part of a Military Pay Act claim but the action must nonetheless be brought within six years of the plaintiff’s discharge.
In Malcolm, the court easily dismissed the Military Pay Act claim as the statute of limitations had expired years before, even though the BCNR had recently issued a decision 2015. There is no way to salvage this claim; he is simply out of time. However, he would still be able to seek judicial review of the BCNR’s decision in a federal district court under the Administrative Procedure Act but, for a variety of reasons I will not delve into in this post, the path to meaningful relief is much more cumbersome.
Claims for medical disability retirement pay are subject to the “first competent board” rule.
The money mandating statute in claims involving possible entitlement to military disability pay is 10 U.S.C. § 1201. Generally, § 1201 claims in the CFC involve one of two scenarios: (1) the plaintiff is challenging the findings of a Physical Evaluation Board or a denial of a request for a PEB or (2) the plaintiff is separated without a PEB hearing, asserts a disability retirement claim before military records-correction board and seeks to challenge the board’s decision in court. To determine jurisdiction, the court applies a “first-competent board” rule which essentially states that a § 1201 claim does not accrue until “a military board evaluates a service member's entitlement to such retirement in the first instance.” Chambers v. United States, 417 F.3d 1218, 1225 (Fed. Cir. 2005). Thus, in scenario (1) above, the date of accrual would be the date of discharge. In scenario (2) the date of accrual would be the date of the records-correction board decision. Therefore, in such instances, an application to a records-correction board is a mandatory prerequisite; a plaintiff must raise his disability retirement claim before a records-correction board before filing suit. The two dates could be years apart, especially given that § 1552 board can—and routinely do—waive their three-year deadline period for applications.
In Malcolm, no competent board had yet considered his § 1201 claim. He did not request a PEB nor had he been evaluation by one prior to discharge and he had not asserted the claim before the BCNR before filing suit. The court easily determined that it lacked jurisdiction over his claim. He may still bring the claim before the BCNR but there is no guarantee, given that he has previously applied to the Board.