Citation Nr: 0816848 Decision Date: 05/22/08 Archive Date: 06/04/08 DOCKET NO. 05-35 804A ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Montgomery, Alabama THE ISSUE Eligibility for payment of attorney fees from past-due benefits. REPRESENTATION Appellant represented by: Disabled American Veterans ATTORNEY FOR THE BOARD Nadine W. Benjamin, Counsel INTRODUCTION The veteran served on active duty from May 1976 to November 1978. This matter comes to the Board of Veterans' Appeals (Board) on appeal from an April 2005 determination of the Department of Veterans Affairs (VA) Regional Office (RO) in Montgomery, Alabama, that determined that the veteran's former attorney was entitled to attorney's fees in the amount of $53,472.53. The veteran challenges this determination. FINDINGS OF FACT 1. In June 1997, the Board entered a final decision finding that new and material evidence had not been submitted to reopen claim for service connection for a psychiatric disorder. 2. There is of record a VA Form 22a Appointment of Attorney as Claimant's Representative, signed by the veteran and dated in August 1998, in favor of the veteran's former attorney. 3. The written fee agreement signed by the veteran and his former attorney and dated August 3, 1998, provided that 20 percent of any past-due benefits were to be paid to the veteran's former attorney; this agreement was first received by the Board in December 1998. 4. In January 2005, the RO granted service connection for a psychiatric disorder, rated as 100 percent disabling effective from August 12, 1992. 5. The January 2005 RO decision resulted in the award of past-due benefits to the veteran in a cash payment in the amount of $267,362.67, from which the attorney fee of $53,472.53 could be deducted. CONCLUSION OF LAW The requirements for payment of attorney fees in the amount of 20 percent of past-due benefits payable to the veteran, in the calculated in the amount of $53,472.53, have not been met. 38 U.S.C.A. § 5904 (West 2002); 38 C.F.R. § 20.609 (2007). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS An attorney fee dispute is not a "claim" for disability compensation benefits. The Court has held that VA's duties to notify and assist do not apply to cases where, as here, the applicant is not seeking benefits under Chapter 51 of Title 38 of the United States Code, but rather, is seeking a decision regarding how benefits will be distributed under another Chapter, i.e., Chapter 59. See Sims v. Nicholson, 19 Vet. App. 453, 456 (2006). This matter comes to the Board from an April 2005 RO decision which determined that the veteran's former attorney was entitled to 20 percent of past due benefits paid to the veteran as a result of a January 2005 RO decision granting service connection for a psychiatric disorder. The veteran appealed the April 2005 determination, claiming that his attorney is not entitled to payment since the attorney had not represented him since 1999. The veteran has stated that his former attorney did very little work on the case. In regard to the fee arrangement, in August 1998, the veteran retained his former attorney to represent him in connection with his appeal to the Court. Of record is a fee agreement dated August 3, 1998, signed by the veteran and his former attorney. In exchange for representation, the veteran agreed to pay a fee equal to 20 percent of the total amount of any past-due benefits awarded by VA. The agreement specified that the veteran could discharge the attorney at any time. The agreement also stipulated that if the veteran discharged his former attorney after he had fully or substantially performed or contributed substantially to the results finally obtained by the veteran, the veteran would be liable for the payment of the fee set forth above. This document was received by the Board in December 1998. In a June 1997 decision, the Board found that no new and material evidence had been received to reopen a claim of entitlement to service connection for a psychiatric disorder. At that time the veteran was represented by Disabled American Veterans. In June 1998, the Board denied a motion by the veteran for reconsideration, filed by DAV. The veteran appealed the Board's decision to the Court, and in October 1998, pursuant to an unopposed motion to remand filed by the Secretary, the Court vacated the Board's June 1997 decision and remanded the case to the Board. The veteran's former attorney was his attorney of record before the Court. In April 1999, and again in December 1999, the Board remanded the claim to the RO. In April 2000, the Board reopened the claim and remanded the issue to the RO for further development. The veteran's former attorney was his representative. In May 2000, the veteran appointed DAV as his representative. In January 2003, the veteran appointed The American Legion as his representative, and in August 2004, the veteran appointed the DAV as his representative. In January 2005, the RO granted service-connection for a psychiatric disorder and assigned a 100 percent evaluation effective from August 1992. Pursuant to the January 2005 RO decision, in an April 2005 letter, the RO notified that veteran that he had been awarded past due benefits in the amount of $267,362.67. He was advised that 20 percent of the past due benefits, or $53,472.53, would be withheld and paid to his attorney. The veteran appealed the RO's determination. In his April 2005 notice of disagreement, he claimed that the attorney had not represented him since 1999, and that he was not entitled to any payment. In his November 2005 substantive appeal, the veteran reported that he was sent a blank copy of a fee agreement in January 1999 and was told to sign it but not to date it. He stated that the former attorney told him in 1999 that he no longer represented the veteran, and that he told his former attorney in May 2000 that he no longer required his services. A claimant may have attorney representation for the prosecution of claims for VA benefits. 38 U.S.C.A. § 5904(a). An attorney may charge a fee for such representation only if specified statutory and regulatory criteria are satisfied. 38 U.S.C.A. § 5904(c), (d); 38 C.F.R. § 20.609(c), (g), and (h). Under 38 U.S.C.A. § 5904(c)(1), a fee may not be charged, allowed, or paid for services of an attorney with respect to services provided before the date on which the Board of Veterans' Appeals first makes a final decision in the case. Such a fee may be charged, allowed, or paid in the case of services provided after such date only if an attorney is retained with respect to such case before the end of the one- year period beginning on that date. The regulation implementing 38 U.S.C.A. § 5904(c)(1), provides in pertinent part, that an attorney may charge fees only if the following conditions have been met: (1) a final decision has been promulgated by the Board with respect to the issue or issues involved; and (2) the attorney was retained not later than one year following the date on which that Board decision was promulgated, (i.e., there was a qualifying fee agreement within that time period). 38 C.F.R. § 20.609(c); see also, In re Mason, 13 Vet. App. 79, 83-86 (1999). It also provides that a copy of the fee agreement must be filed with the Board [the regulation provides the specific address] within 30 days of its execution. See 38 C.F.R. § 20.609(g). Subject to the requirements set forth above, a claimant and an attorney-at-law may enter into a fee agreement providing that payment for the services of the attorney-at-law will be made directly to the attorney-at-law by VA out of any past- due benefits awarded as a result of a successful appeal to the Board or an appellate court or as a result of a reopened claim before VA following a prior denial of such benefits by the Board or an appellate court. Such agreement will be honored by VA only if the following conditions are met: (1) the total fee payable (excluding expenses) does not exceed 20 percent of the total amount of the past-due benefits awarded; (ii) the amount of the fee is contingent on whether or not the claim is resolved in a manner favorable to the claimant or appellant; and (iii) the award of past-due benefits results in a cash payment to a claimant or an appellant from which the fee may be deducted. 38 C.F.R. § 20.609(h). Additionally, the attorney must notify the agency of original jurisdiction [i.e., the RO] of the existence of the agreement within 30 days of its execution. 38 C.F.R. § 20.609(h)(4). Past-due benefits means a nonrecurring payment resulting from a benefit, or benefits, granted on appeal or awarded on the basis of a claim reopened after a denial by the Board or the lump sum payment which represents the total amount of recurring cash payments which accrued between the effective date of the award, as determined by applicable laws and regulations, and the date of the grant of the benefit by the agency of original jurisdiction, the Board, or an appellate court. 38 C.F.R. § 20.609(h)(3). The veteran challenges the RO's determination that his former attorney is entitled to attorney's fees owed by the veteran from VA from the veteran's past due benefits. Such payment is authorized if there was a fee agreement stipulating such mode of payment, and the fee agreement was in compliance with legal requirements (see 38 C.F.R. § 20. 609(h)). The record shows that a final Board decision was promulgated on June 6, 1997. However, here the agreement was not compliant with legal requirements. The veteran's former attorney was not retained by the veteran until August 3, 1998, more than a year after the Board decision was issued. This is evidenced by the attorney fee agreement dated on August 3, 1998, and as noted above, the retaining of an attorney is shown by a qualifying fee agreement within the required time period. Additionally a copy of the fee agreement (rather than just a designation of representation) was not timely filed with the Board (See 38 C.F.R. § 20.609(g)), that is, within 30 days after August 3, 1998, since it was not received until December 1998, and the appellant did not notify the RO of the fee agreement, as required by regulation. See 38 C.F.R. § 20.609(h)(4). In light of the foregoing, the veteran's former attorney is not entitled to attorney's fees based on past due benefits. The law and regulations governing attorney fees is specific regarding the process that must be undertaken. The veteran's former attorney is presumed to have knowledge of governing statute and regulations. As such, the veteran's appeal must be granted. ORDER The fee agreement not having been timely filed by the veteran's former attorney, the veteran's claim for revocation of the award of attorney fees from past-due benefits, in the calculated amount of $53,472.53, is granted. ____________________________________________ STEVEN D. REISS Acting Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs