Citation Nr: 0117428 Decision Date: 06/29/01 Archive Date: 07/03/01 DOCKET NO. 97-33 994A ) DATE ) ) THE ISSUE Whether a November 16, 1982, decision of the Board of Veterans' Appeals which denied entitlement to a total rating based on individual unemployability after February 28, 1981, should be revised or reversed on the basis of clear and unmistakable error. REPRESENTATION Appellant represented by: The American Legion ATTORNEY FOR THE BOARD R. L. Shaw, Counsel INTRODUCTION The veteran had active military service from April 1947 to January 1948, from October 1948 to September 1949, from October 1950 to December 1950, and from February 1955 to June 1958. This matter is before the Board of Veterans' Appeals (Board) as an original action on a motion by the veteran pursuant to 38 U.S.C.A. §§ 5109A(a) and 7111 (Supp. 2000) alleging clear and unmistakable error (CUE) in a November 16, 1982, Board decision which denied the veteran's appeal for a total disability rating for compensation purposes based on individual unemployability due to service-connected disabilities (TDIU). The issue was before the Board in November 1982 on appeal from a rating decision by the Des Moines, Iowa, Regional Office (RO) of the Department of Veterans Affairs (VA) which terminated, effective February 28, 1981, a TDIU rating that had been in effect since February 1, 1970. The November 16, 1982, Board decision also denied a rating higher than 20 percent for lumbosacral strain, a rating higher than 10 percent for plantar warts of the right foot with resection of the second metatarsal head, a rating higher than 10 percent for plantar warts of the left foot with resection of the second metatarsal head, and a rating higher than 10 percent for anxiety reaction. The veteran has not disputed these determinations on the basis of CUE; accordingly, these matters will not be addressed herein. The veteran's original petition for review of the November 16, 1982, Board decision consisted of a motion for reconsideration pursuant to 38 U.S.C.A. §§ 7103, 7104 (West 1991 & Supp. 2000); 38 C.F.R. §§ 20.1000, 20.1001 (2000). A June 1, 1998, letter from the Acting Chairman of the Board informed the veteran that the motion had been denied. Following further argument by the veteran in support of the motion, the Senior Deputy Vice Chairman of the Board, by a September 16, 1998, letter, reaffirmed the denial of reconsideration. The Acting Chairman's June 1, 1998, letter advised the veteran that the request for reconsideration would be regarded also as a motion for review of the Board's November 16, 1982, decision on the basis of CUE. Thereafter, on April 15, 1999, the Board provided the veteran with a copy of the final regulation amending the Board's Rules of Practice to reflect newly-enacted statutory authority granted to the Board under Pubic Law 105-111 to review prior Board decisions on the basis of CUE, and sought verification of the veteran's desire to seek such review. The Board explained that the regulations contained "very specific rules for what you must do to prevail," and warned that once a motion for review on the basis of CUE was finally denied, the Board would not consider another CUE motion on that decision. The veteran responded by a May 1999 letter which reasserted his allegations of CUE in the Board's November 1982 decision. The Board notes that in connection with his requests for reconsideration and CUE review, the veteran has submitted evidence which has been associated with the claims file. Much of this material consists of documents that were of record and before the Board on November 16, 1982. The original copies of the documents previously of record before the Board will be reviewed to the extent that they are relevant to the present determination. The remainder of the documents submitted did not come into existence until after November 16, 1982, and the most recent statement of CUE allegations by the veteran includes a brief statement by the veteran's wife which is offered as evidence to support the CUE motion. Pursuant to Rule 1405(b) of the Board's Rules of Practice, found at 38 C.F.R. § 20.1405(b) (2000), no new evidence will be considered in conjunction with the disposition of a motion based on CUE. FINDINGS OF FACT 1. In September 1970 the RO assigned a TDIU from February 1, 1970, based on service-connected disabilities rated in combination as 60 percent disabling. 2. A rating decision of December 1980 reduced the ratings for service-connected disabilities of the veteran's feet and terminated the TDIU from March 1, 1981. 3. The Board of Veterans' Appeals entered a decision on November 16, 1982, which, among other determinations, held that the veteran was not entitled to a TDIU after February 28, 1981. 4. The November 16, 1982, Board decision which denied a TDIU after February 28, 1982, did not include a determination of actual employability and the record before the Board was insufficient to support such a finding. 5. The November 16, 1982, Board decision which denied a TDIU after February 28, 1982, was not consistent with or supported by the evidence then of record and involved misapplication of applicable VA regulations such as to undebatably result in an incorrect decision. CONCLUSION OF LAW The November 16, 1982, Board decision denying entitlement to a TDIU after February 28, 1981, involved clear and unmistakable error. 38 U.S.C.A. § 7111 (Supp. 2000); 38 C.F.R. §§ 20.1403 and 20.1404 (2000). REASONS AND BASES FOR FINDINGS AND CONCLUSION I. Factual Background By a rating decision of September 10, 1970, the RO reviewed the veteran's original claim for a total rating based on individual unemployability, received in April 1970, and awarded a TDIU from February 1, 1970. By the same decision, the RO terminated a 10 percent rating in effect for bilateral plantar warts that had been in effect since October 1969 and replaced it with individual 30 percent ratings for plantar warts of the right foot and left foot with resection of the second metatarsal heads, also effective February 1, 1970. A 10 percent rating for a psychiatric disorder classified as anxiety reaction with simple adult maladjustment was assigned from November 26, 1969. The combined rating for service-connected disabilities increased to 60 percent from February 1, 1970, as a result of these determinations. The veteran subsequently submitted yearly employment questionnaires wherein he reported that he remained unemployed. The veteran underwent a VA compensation examination in November 1980. He complained of problems with his feet, legs and back. On examination of the back, straight leg raising was to 45 degrees on the right and to 50 degrees on the left. There was a full range of motion of the back. He complained of swelling and pain in the feet. At the time of the examination there was no swelling of the feet. There were no plantar warts and the soles of each foot appeared to be normal. The diagnoses included lumbosacral strain, by history, not diagnosed today; and status post resection of plantar warts, each foot, by history. On neurosurgical consultation, the veteran gave an 11-year history of low back pain secondary to foot surgery. He complained that the pain had been present ever since the operation and that it radiated from the low back to the hips and was worse with movement. The veteran was able to walk without a list. Forward-backward bending was within normal limits. Straight leg raising and bowstring tests were negative. Sensory examination was normal. Review of lumbosacral X-rays showed no abnormalities. The examiner stated that the neurological examination was normal. VA medical records show that the veteran received treatment during and after service for bilateral plantar warts. In June 1969 he underwent an excision of a plantar wart on the right foot at a VA hospital. In October 1969 he was readmitted and underwent surgical resection of the second metatarsal head of each foot. In October 1980, R. J. Blommer, M.D., reported that he had followed the veteran since April 1977 and that current diagnoses included situational anxiety and depressive reaction. The veteran had been hospitalized on three occasions in 1979 and 1980 for depressive reaction and alcoholic excess, depressive reaction, and excess medication ingestion and alcoholic excess. By a rating decision of December 29, 1980, the individual 30 percent ratings for the right and left feet were reduced to zero percent from March 1, 1981, thereby reducing the combined rating for service-connected disabilities to 30 percent. The TDIU was terminated from February 28, 1981. The veteran submitted a timely notice of disagreement with the December 1980 rating decision and a further VA examination was performed in April 1981. According to the examiner, the claims file was available and was reviewed in detail. The veteran complained that his feet swelled and hurt. He complained of pain in the hips and back which he related to his foot condition. Examination showed a well-healed scar of the right foot at the surgical site which was tender to deep palpation. There were no callosities on the plantar surface of the foot but there was a small pin- like hole directly below the surgical scar on the dorsum of the foot where the veteran claimed that a pin had been run through the foot. There was no swelling of the foot. Examination of the left foot showed a 4-centimeter surgical scar on the dorsum similar to the scar on the right foot. The scar was tender to deep palpation. There was no callosity on the plantar surface or pit holes. The veteran was able to balance himself on his heels and raise himself on his toes. He tandem walked with some "tippy difficulty" at a few points but got the walking done fairly well. He had never had special shoes. The diagnoses were plantar wart with resection of the second toe of the right foot and of the left foot. An orthopedic consultation was performed in April 1981. The veteran complained of pain in the back radiating to both hips and of bilateral foot pain with weight bearing. Neurological examination of the lower extremities was within normal limits. There was marked tenderness of both metatarsal head and neck areas. There was no pain with medial/lateral compression of the forefoot. The clinical impression was bilateral metatarsalgia over the second metatarsal heads and chronic low back pain. It was recommended that the veteran avoid stooping, bending or lifting and that he be referred to prosthetics for bilateral molded acrylic insoles to relieve weight from the second metatarsal heads. On further review of the case on April 24, 1981, the RO assigned a 10 percent rating for the right foot and a 10 percent rating for the left foot from March 1, 1981, thereby raising the combined rating for service-connected disabilities to 40 percent as of that date. The veteran underwent a VA compensation examination in January 1982. The examiner reviewed the claims file in detail. The veteran complained that his back was painful, especially on the left, and that it was hard for him to bend. He reported that he had had a job in Las Vegas working on cars and doing automobile salvage but had been fired because he could not do the work due to his back. He related that his feet had improved as a result of orthopedic shoes with built-in arches that he had gotten through a friend. He complained that his nerves upset his stomach. On examination there was some flattening of the lumbosacral spine and percussion tenderness in the lumbosacral area and some muscle spasm. There was limited range of motion. Examination of the feet showed tenderness to palpation but less than before. X-rays showed no evidence of deformity or acute fracture of the feet. There was an old fracture at the distal end of the second metatarsal on the left. X-rays of the lumbosacral spine showed spur formations on the lumbar vertebra. The disc spaces were preserved. The diagnoses included lumbosacral strain, plantar wart of the right foot and plantar wart of the left foot. On a VA psychiatric examination in January 1982, the veteran related that his wife had died in 1978 after heart surgery. He had three adult children. After his disability was reduced to 30 percent he had had to move from place to place and with his wife's hospital bills he could no longer afford the house. He was living in the basement of a house. His time was spent watching television. His job in Nevada taking engines out of cars had lasted a week and a half. The examiner believed that the probable diagnosis on Axis I was adjustment disorder with mixed emotional features. Severe psychosocial stressors involving personal relationships and financial matters were reported. The highest level of adaptive function during the past year "might be rated poor." In its decision of November 16, 1982, the Board upheld the denial of increased ratings for lumbosacral strain, each foot, and anxiety neurosis. The Board noted that the veteran had the equivalent of a high school education and had last worked in February 1969, that he had occupational experience as a welder and assembler, and that he had technical or vocational training in automobile mechanics and police work. The Board found that the veteran's service-connected disabilities were not so incapacitating as to preclude him from some employment compatible with his education and past experience. The record shows that the rating for anxiety reaction was subsequently raised to 30 percent from August 1984 and that the rating for plantar warts of the left foot was raised to 20 percent from October 1986. In January 1991 the veteran applied for a TDIU which the RO denied in February 1991. On appeal, the Board awarded a TDIU in September 1993 for which the RO assigned an effective date of January 28, 1991. In a decision dated September 15, 1993, the Board revised the effective date of the TDIU as March 20, 1990. II. Legal Criteria Before November 21, 1997, a claimant was precluded by law from collaterally attacking a prior final Board decision by alleging CUE in either the Board's decision or in a rating decision that was subsumed in that decision. Smith v. Brown, 35 F.3d, 1516 (Fed. Cir. 1994). However, such challenges have been permitted since November 21, 1997, the date of enactment of Pub. L. No. 105-111, 111 Stat. 2271. The statutory authority for the revision of Board decisions on the basis of CUE granted by Public Law No. 105-111 is found in 38 U.S.C.A. §§ 5109A (a) and 7111 (West 1991 & Supp. 2000) which codified, without substantive change, the existing regulation, 38 C.F.R. § 3.105(a), providing for revision of RO decisions on the basis of CUE. Donovan v. West, 158 F.3d 1377 (Fed. Cir. 1998); Dittrich v. West, 163 F.3d 1349, 1352 (Fed Cir. 1998). The Board has original jurisdiction to determine whether CUE exists in a prior final Board decision. Such review may be initiated by the Board on its own motion or by a party to the decision. 38 C.F.R. § 20.1400 (2000). The VA General Counsel has held that the Board's new authority applies to any claim pending on or filed after November 21, 1997, the date of enactment of the statute. See 38 C.F.R. § 20.1400 (2000); VAOPGCPREC 1-98 (Jan. 13, 1998). Rule 1403 of the Board's Rules of Practice, found at 38 C.F.R. § 20.1403, defines what does and does not constitute CUE. The regulation provides as follows: (a) General. Clear and unmistakable error is a very specific and rare kind of error. It is the kind of error, of fact or of law, that when called to the attention of later reviewers compels the conclusion, to which reasonable minds could not differ, that the result would have been manifestly different but for the error. Generally, either the correct facts, as they were known at the time, were not before the Board, or the statutory and regulatory provisions extant at the time were incorrectly applied. (b) Record to be reviewed.--(1) General. Review for clear and unmistakable error in a prior Board decision must be based on the record and the law that existed when that decision was made. (2) [Omitted] (c) Errors that constitute clear and unmistakable error. To warrant revision of a Board decision on the grounds of clear and unmistakable error, there must have been an error in the Board's adjudication of the appeal which, had it not been made, would have manifestly changed the outcome when it was made. If it is not absolutely clear that a different result would have ensued, the error complained of cannot be clear and unmistakable. (d) Examples of situations that are not clear and unmistakable error.-- (1) Changed diagnosis. A new medical diagnosis that "corrects" an earlier diagnosis considered in a Board decision. (2) Duty to assist. The Secretary's failure to fulfill the duty to assist. (3) Evaluation of evidence. A disagreement as to how the facts were weighed or evaluated. (e) Change in interpretation. Clear and unmistakable error does not include the otherwise correct application of a statute or regulation where, subsequent to the Board decision challenged, there has been a change in the interpretation of the statute or regulation. (Authority: 38 U.S.C.A. § 501(a), 7111). The regulatory definition of CUE was based on prior rulings of the United States Court of Appeals for Veterans Claims (previously known as the United States Court of Veterans Appeals) (Court), and Congress intended that the VA adopt the Court's interpretation of the term "clear and unmistakable error." Therefore, the jurisprudence that has evolved from years of court decisions is applicable in the present adjudication. The Court has consistently stressed the rigorous nature of the concept of CUE, stating that "[c]lear and unmistakable error is an administrative failure to apply the correct statutory and regulatory provisions to the correct and relevant facts; it is not mere misinterpretation of facts." Oppenheimer v. Derwinski, 1 Vet.App. 370, 372 (1991). CUE denotes "errors that are undebatable, so that it can be said that reasonable minds could only conclude that the original decision was fatally flawed at the time it was made." Russell v. Principi, 3 Vet.App. 310, 313 (1992). "It must always be remembered that [CUE] is a very specific and rare kind of 'error.'" Fugo v. Brown, 6 Vet.App. 40, 43 (1993). A disagreement with how the Board evaluated the facts is inadequate to raise the claim of CUE. Luallen v. Brown, 8 Vet.App. 92, 95 (1995). A finding of CUE "must be based on the record and the law that existed at the time of the prior . . . decision." Russell v. Derwinski, 3 Vet. App. 310, 313-14 (1992). Subsequently developed evidence may not be considered in determining whether error existed in the prior decision. Porter v. Brown, 5 Vet. App. 233, 235-36 (1993). The mere misinterpretation of facts does not constitute clear and unmistakable error. Thompson v. Derwinski, 1 Vet. App. 251, 253 (1991). Moreover, the error must be one which would have manifestly changed the outcome at the time that it was made. Kinnaman v. Derwinski, 4 Vet. App. 20, 26 (1993). "It is a kind of error, of fact or of law, that when called to the attention of later reviewers, compels the conclusion, to which reasonable minds cannot differ, that the results would have been manifestly different but for the error." Fugo v. Brown, 6 Vet. App. 40, 43 (1993). For VA purposes, total disability will be considered to exist when there is present any impairment of mind or body which is sufficient to render it impossible for the average person to follow a substantially gainful occupation. 38 C.F.R. § 3.340. The version of 38 C.F.R. § 4.16(a), the VA regulation in effect in November 1982 containing the criteria for TDIU provided as follows: A total rating for compensation may be assigned where the schedular rating is less than total, when the disabled person is, in the judgment of the rating agency, unable to secure or follow a substantially gainful occupation as a result of service-connected disabilities, Provided That, if there is only one such disability, this disability shall be ratable at 60 percent or more, and that if there are two or more disabilities, there shall be at least one disability ratable at 40 percent or more, and sufficient additional service-connected disability to bring the combined rating to 70 percent or more. The provisions of 38 C.F.R. § 3.343(c) (as in effect in November 1982) set forth the evidentiary standard for termination of a TDIU: In reducing a rating of 100 percent service-connected disability based on individual unemployability, the provisions of § 3.105(e) are for application [requiring notice and a 60-day response before the reduction of a rating] but caution must be exercised in such a determination that actual employability is established by clear and convincing evidence. Also in effect was 38 C.F.R. § 3.344 which set forth the criteria that must be satisfied for reduction of a rating in effect for a period of more than five years: Rating agencies will handle cases affected by change of medical findings or diagnosis, so as to produce the greatest degree of stability of disability evaluations consistent with the laws and [VA] regulations governing disability compensation and pension. It is essential that the entire record of examinations and the medical-industrial history be reviewed to ascertain whether the recent examination is full and complete, including all special examinations indicated as a result of general examination and the entire case history.... Examinations less full and complete than those on which payments were authorized or continued will not be used as the basis of reduction.... Moreover, though material improvement in the physical or mental condition is clearly reflected the rating agency will consider whether the evidence makes it reasonably certain that the improvement will be maintained under the ordinary conditions of life. 38 C.F.R. § 3.344(a) (as in effect in November 1982). III. Analysis The veteran's CUE motion and supporting arguments are vague and imprecise as to the precise legal basis by which he seeks to invalidate the November 1982 Board decision. He maintains first that the termination of the TDIU was "illegal and irresponsible," and second, that the VA examination performed in November 1980 was inadequate. To the extent that he is specific, he argues that he had never previously been examined in Iowa City and that when he arrived there, the examiner had no records and had to spend an hour or more waiting for records to be faxed. When the information came, it consisted of only two small pages. In effect, he argues, if the examiner had had the multiple volumes of medical records, a better examination could have been performed and the ratings would not have been reduced. He alleges that the poor quality of the examination is shown by the fact that after a further examination in Des Moines in April 1981, the rating was raised 10 percent. The lack of specificity as to the nature of the alleged CUE is not by itself fatal to the motion, however, in view of the decision of the United States Court of Appeals for the Federal Circuit (Federal Circuit) in Disabled American Veterans, et. al, v. Gober, 234 F.3d, 682 (2000), wherein the Federal Circuit invalidated Rule 1404(b) (38 C.F.R. § 20.1404(b)) as it operated in conjunction with Rule 1404(c) (38 C.F.R. § 20.1404(c)) to deny review of a CUE motion for failure to comply with the regulatory pleading requirements. The Board is now free to review the decision for CUE regardless of whether there are specific allegations of fact or law that would have satisfied the regulation. In this regard, it is relevant to point out that the Board's decision mischaracterized the issue before it in November 1982 as entitlement to a TDIU. The case was before the Board on a direct appeal of a rating decision that had terminated a TDIU that had previously been awarded. Consequently, by deciding an issue that was not on appeal, i.e., whether the veteran had initial entitlement to a TDIU, the Board did not address the issue that was procedurally before it, which was whether the reduction of the rating was proper. The Court has held that VA failure to properly apply the regulations controlling reduction of ratings renders such a reduction void ab initio. Brown v. Brown, 5 Vet. App. 413, 422 (1993); Dofflemyer v. Derwinski, 2 Vet. App. 277 (1992). See also Kitchens v. Brown, 7 Vet. App. 320, 325 (1995); Ternus v. Brown, 6 Vet. App. 370, 376 (1994) (Failure to apply reduction regulation was clear and unmistakable error). The result of failing to acknowledge the distinction between the propriety of the termination and a determination of initial entitlement to a TDIU was to deny the veteran the benefit of the more stringent evidentiary standard applied in considering the propriety of the termination of a TDIU. Under § 3.343(c), actual employability must be shown by clear and convincing evidence. The "clear and convincing" standard requires that capacity for work be proven to a "reasonable certainty" but not necessarily be "undebatable." Vanerson v. West, 12 Vet. App. 254, 258 (1999). The clear and convincing standard of proof is an intermediate standard between preponderance of the evidence and beyond a reasonable doubt. Fagan v. West, 13 Vet. App. 48, 55 (1999); Olson v. Brown, 5 Vet. App. 430, 434 (1993). The procedural burden of showing clear and convincing evidence of actual employability for purposes of terminating the TDIU continued to apply even though the veteran no longer satisfied the schedular prerequisites for a TDIU under 4.16(a) after the RO reduced the individual ratings for the service-connected disabilities. The medical evidence of record in November 1982 consisted of the reports of VA examinations performed in November 1980, April 1981, and January 1982, and the report of a private psychiatrist, Dr. Blommer. The content of the reports was limited to current complaints and findings with no discussion of the extent to which service-connected disabilities affected the veteran's capacity to engage in gainful employment. The reports noted that the veteran had been employed briefly doing automobile salvage work but did not discuss the reasons for the termination of this employment other than to repeat the veteran's complaint that he could not work because of his feet and back. There was no inquiry as to whether the disabilities were in fact severe enough to preclude further pursuit of this or any other occupation. The Board merely repeated the evidence without comment. While the decision referred briefly to the veteran's occupational and educational background and included brief and conclusory statements alleging a lack of incapacity to work due to service-connected disabilities, there was no attempt to correlate such conclusions to any actual reported findings in the record. The Board's analysis was clearly inadequate to satisfy the requirements of 38 C.F.R. § 3.343 inasmuch as the applicable standard, actual employability, was not discussed. By ignoring § 3.343(c), the Board in effect reversed the standard of proof required for a TDIU termination by requiring that the veteran meet the criteria for initial entitlement to such a rating rather than requiring the Government to satisfy the legal standard for termination. The Board failed to cite the applicable reduction criteria or discuss the evidence of record in light of such criteria. The Board's failure to apply the correct legal standard in evaluating this evidence constituted CUE as a matter of law. See Russell, Id. Furthermore, even if the correct standard had been applied, the evidence of record in November 1982 did not establish actual employability by any standard, clear and convincing or otherwise. There was no medical opinion or other evidence of record to support a finding that the veteran had the physical or mental capacity to engage in substantially gainful employment in November 1982. A determination as to employability or unemployability is inherently one of fact rather than law, and the law precludes weighing and evaluating of the evidence as a basis for CUE. See 38 C.F.R. § 20.1403(d)(3); Baldwin v. West, 3 Vet. App. 1, 5 (1999); Damrel v. Brown, 6 Vet. App. 242, 246 (1994). However, the deficiency in the November 1982 decision was not merely that the evidence regarding employability was improperly weighed and balanced, but that the decision was made without any such evidence at all, favorable or unfavorable. In effect, the Board found evidence where there was none. Under both the regulation and the case law, the entry of a decision when the correct facts as known at the time were not before the Board provides an additional independent basis for a finding of error. Lastly, the Board would note that the situation here is factually similar to that presented in Olson v. Brown, 5 Vet. App. 430 (1993) wherein the Court reviewed a November 1990 Board decision that had denied entitlement to a TDIU following an RO termination of such rating on the basis that service-connected disability did not prevent the veteran from engaging in all forms of gainful employment. On appeal, the Court reversed the Board's decision as a result of its failure to apply § 3.343(c). The Court stated that there was no evidence of employability at the time of the 1981 RO decision; the RO certainly did not have 'clear and convincing evidence' with which to terminate the veteran's [TDIU]. Reasonable minds could only conclude that the original decision was fatally flawed because of the failure to consider the applicable regulations. The Board finds that if the provisions of 38 C.F.R. § 3.343(c) been applied as the basis for the Board's review in accordance with the law and if the sufficiency of the evidence to establish actual unemployability been considered under the "clear and convincing standard," the outcome of that decision would have manifestly different. Therefore, the Board's November 1982 decision denying the veteran's appeal of the termination of a TDIU involved CUE. Such decision is reversed and restoration of a TDIU from the date of its termination is granted. ORDER Restoration of a TDIU on the basis of CUE in the Board's decision of November 16, 1982, is granted. ROBERT E. SULLIVAN Member, Board of Veterans' Appeals