Citation Nr: 0625305 Decision Date: 08/16/06 Archive Date: 08/24/06 DOCKET NO. 04-20 198 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Hartford, Connecticut THE ISSUE Whether VA compensation benefits awarded under the provisions of 38 U.S.C.A. § 1151 should be offset by the entire amount of a $500,000.00 settlement under the Federal Tort Claims Act (FTCA). REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD K.A. Kennerly, Associate Counsel INTRODUCTION The veteran served on active duty from October 1967 to October 1969. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a March 2003 rating decision of the Hartford, Connecticut, Regional Office (RO) of the Department of Veterans Affairs (VA). The veteran participated in RO hearings on this particular issue in October 2001 and May 2004. The veteran also had a hearing before a Veterans Law Judge in August 2004. Since that Judge has since retired from the Board, the veteran had another hearing before the undersigned in June 2006. FINDINGS OF FACT 1. In August 1999, the RO granted the veteran entitlement to compensation benefits under 38 U.S.C.A. § 1151 for residuals of excision of a meningioma, to include a skull defect; seizures; headaches; scars of the left thigh, left forearm and left frontal area; right upper extremity ataxia; right lower extremity ataxia; impotence; major depression and worsening of pre-existing diabetes. 2. Pursuant to 28 U.S.C. § 2672, the veteran also obtained a settlement of an FTCA claim in the amount of $500,000.00 based on the same disability. CONCLUSION OF LAW The veteran's compensation benefits awarded pursuant to 38 U.S.C.A. § 1151 are subject to offset in the amount of $500,000.00 against his FTCA settlement award. 38 U.S.C.A. § 1151(b) (West 1991); 38 C.F.R. § 3.800(a)(2) (2005). REASONS AND BASES FOR FINDINGS AND CONCLUSION In August 1999 the RO granted the veteran entitlement to compensation benefits for his disabilities pursuant to the provisions of 38 U.S.C.A. § 1151 for additional disability resulting from VA medical treatment beginning in 1995. In the instant case, the RO granted the veteran compensation benefits pursuant to the provisions of 38 U.S.C.A. § 1151 for residuals of excision of a meningioma, to include a skull defect; seizures; headaches; scars of the left thigh, left forearm and left frontal area; right upper extremity ataxia; right lower extremity ataxia; impotence; major depression and worsening of pre-existing diabetes. By letter dated in April 2001, the Director of the VA Compensation and Pension Service notified the RO of the settlement of the tort claim and advised the RO of the provisions of 38 C.F.R. § 3.800(a)(2) providing that if entitlement to benefits was established under 38 U.S.C.A. § 1151, such benefits were subject to offset. The RO notified the veteran that the settlement amount of $500,000.00 was subject to offset until the amount of settlement had been recouped from his compensation in July 2001. The RO proposed to begin recoupment of benefits effective October 1, 2001. However, the veteran requested a hearing, and this was conducted in late October 2001. In accordance with VA law, the veteran's compensation payments were not discontinued while the Decision Review Officer (DRO) considered his case. The veteran has complained that it then took 17 months for the DRO to decide his case, which she did in March 2003. Although the veteran's concern over the length of time it took to adjudicate his claim is certainly understandable, it must be noted that VA deals with many, many claims, and 17 months does not seem an unreasonable period of time. Moreover, the veteran's due process rights were protected during this time period as his VA compensation benefits remained in force. The veteran argues his VA award should not be offset by the settlement agreement because while he was awaiting a decision from the DRO, VA sent a letter to him indicating he had been awarded VA compensation benefits in the amount of $2323 per month and that he then used that letter to obtain financing to purchase a home. The letter does not state that the monthly payments would continue indefinitely, as he alleges, and, moreover, the fact that he chose to use this information to obtain a loan does not bind VA to any particular course of action. The settlement agreement signed by the veteran in 2001 clearly stated the offset would occur (as discussed in more detail below), and he had already had notice from VA that offset would occur, and a hearing on this question. He then chose in the following year to ignore the fact that the offset question was still pending before VA and incur financial obligations and it is his actions alone that created the future financial difficulties he now complains of. As for the offset question, a Stipulation for Compromise Settlement signed by the veteran and his attorney in March 2001 provided that pursuant to 28 U.S.C.A. § 2672, the defendant, the United States (U.S.), would pay to the veteran a sum of money ($500,000.00) as full settlement and satisfaction of the claim arising from the acts of omission that gave rise to the administrative claim filed with VA Regional Counsel in Newington, Connecticut, related to medical care provided at the Newington and West Haven VA medical centers beginning in February 1995. The Stipulation for Compromise Settlement further provided that this sum was in full settlement and satisfaction of any and all claims, demands, rights and causes of action of whatsoever kind and nature, arising from, and by reason of any and all known and unknown, foreseen and unforeseen bodily and personal injuries, damage to property and consequences thereof, resulting, and to result, from the subject matter of this settlement, including any claims for wrongful death, for which the claimant now have or may hereafter acquire. It was also noted that the veteran was in receipt of VA compensation benefits pursuant to 38 U.S.C.A. § 1151, which would be suspended due to the settlement in accordance with the provisions of the statute. However, continuing eligibility for hospital care, medical services and nursing home care under 38 U.S.C.A. §§ 1710(a)(2)(c) is preserved under the Settlement Agreement. In his personal injury claim, the veteran asserted that his disabilities included significant problems with the right arm and leg, difficulty standing and walking, dizzy spells, balancing problems, extreme headaches, sleep difficulties, memory loss, scars, sexual dysfunction, head and neck pain and inability to work. See Form 95-109, dated September 9, 1998. The veteran and his representative contend that VA should not offset the entire amount of his monthly compensation because the compensation is being paid for several different disabilities, only some of which were contemplated in the personal injury settlement. It was indicated that the service-connected disabilities of skull defect and right-sided focal seizures were not included in the personal injury claim and as such, are not part of the $500,000.00 settlement, so any compensation due based on these two disabilities should not be offset. See RO hearing transcript, dated in October 2001. Under 38 U.S.C.A. § 1151, "[w]here an individual is, on or after December 1, 1962, awarded a judgment against the United States in a civil action brought pursuant to section 1346(b) of title 28, or . . . enters into a settlement or compromise under section 2672 or 2677 of title 28 by reason of a disability or death treated pursuant to this section as if it were service-connected, then no benefits shall be paid to such individual for any month beginning after the date such judgment, settlement, or compromise becomes final until the aggregate amount of benefits which would be paid but for this subsection equals the total amount included in such judgment, settlement or compromise." See 38 U.S.C.A. § 1151(b). The provisions of this paragraph do not apply, however, to any portion of such compensation or dependency and indemnity compensation payable for any period preceding the end of the month in which such judgment, settlement, or compromise becomes final. See 38 C.F.R. § 3.800(a)(2) (2005). The veteran has obtained a $500,000.00 settlement from a FTCA claim under 28 U.S.C. § 2672 based on the same injury. 38 U.S.C.A. § 1151 provides that where an individual is awarded a judgment against the United States or enters into a settlement or compromise under the FTCA by reason of disability, aggravation, or death treated pursuant to § 1151 as if it were service-connected for purposes of compensation paid by VA, then no such benefits shall be paid to such individual by VA until the aggregate amount of benefits which would have been paid equals the total amount included in such award. At the 2001 RO hearing, the veteran's attorney argued that the FTCA settlement included amounts for future medical expenses, pain and suffering, and economic injury due to inability to work, and that only a portion of the settlement amount should be offset by VA's compensation benefits. However, offset against VA benefits of both economic and non- economic elements of damage recoveries under the FTCA, 28 U.S.C. §§ 2671-2680, is consistent with the terms of 38 U.S.C.A. § 1151 and its stated purpose. See VAOPGCPREC 52-91 and 7-94; Kubrick v. United States, 444 U.S. 111 (1979) (rev'd on other grounds). The veteran also argues that the wording of the settlement agreement is unfair and he should not be subject to a "blanket" offset. Regardless of the equities of the situation, the fact remains that he, with counsel of a private attorney, chose to sign the settlement agreement which plainly and unequivocally stated the offset would occur, as detailed above, and this is in accordance with the laws enacted by Congress. To the extent that the veteran argues that there should not be an offset against the portion of the settlement pertaining to his skull defects and seizures, the Board disagrees. The language of the RO's August 1999 rating decision granting § 1151 compensation as well as the veteran's statement in conjunction with his personal injury claim pertain to the same injuries. The language of the Settlement Agreement is clear, that the monetary award is to cover all present and future claims arising out of the veteran's § 1151 benefits. The Board also notes that the veteran retained the same attorney to assist him with his personal injury claim as with his VA claim, thus leaving no room for confusion. Though the Board is sympathetic to the extent of the veteran's medical problems, the law is clear on this issue. The veteran may not be compensated twice for the same injuries. In conclusion, the Board finds that the veteran's compensation benefits awarded pursuant to 38 U.S.C.A. § 1151 are subject to offset in the amount of $500,000.00 against his FTCA settlement award and that the RO's offset of these benefits was proper. When a veteran is awarded benefits pursuant to the FTCA, compensation shall not be paid pursuant to 38 U.S.C.A. § 1151 based on the same incident until an amount equal to the tort award is offset by VA. See VAOPGCPREC 79-90 (the offset provision of section 351(now § 1151) was intended to assure that the same individual does not recover twice for the same disability or death). The Board notes that at the 2006 hearing before the undersigned, some concern was raised as to whether the overpayment that was created when VA retroactively discontinued the veteran's compensation benefits in 2003 was in addition to offset of the $500,000 amount of the settlement. An August 2003 routing slip in the file indicates that although the overpayment was initially created in addition to the offset, the overpayment was cleared from the veteran's account, so that the retroactive discontinuance of compensation benefits would be credited toward the offset amount. Duties to Notify and Assist The Veterans Claims Assistance Act of 2000 (VCAA), Pub. L. No. 106-475, 114 Stat. 2096 (2000) (codified at 38 U.S.C.A. §§ 5100, 5102-5103A, 5106, 5107, 5126 (West 2002 & Supp. 2005)), imposes obligations on VA in terms of its duties to notify and assist claimants. However, the facts are not in dispute, and where, as in this case, the decision rests on the interpretation of the law, the VCAA is inapplicable. See Dela Cruz v. Principi, 15 Vet.App. 143 (2001). Similarly, compliance with the VCAA is not required if no reasonable possibility exists that any notice or assistance would aid the appellant in substantiating the claim. See Wensch v. Principi, 15 Vet. App. 362, 368 (2001). Therefore, any deficiencies of VCAA notice or assistance are rendered moot. ORDER The appeal to establish that proceeds of a settlement under FTCA should not be offset against compensation benefits granted under 38 U.S.C.A. § 1151 is denied. ____________________________________________ MICHELLE L. KANE Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs