Citation Nr: 1127710 Decision Date: 07/25/11 Archive Date: 08/02/11 DOCKET NO. 11-08 271 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Los Angeles, California THE ISSUE Whether the rating reduction from 10 percent to zero percent effective December 15, 1957, for anxiety reaction was proper. REPRESENTATION Appellant represented by: George E. Quillen, Attorney WITNESS AT HEARING ON APPEAL The Veteran ATTORNEY FOR THE BOARD Michael T. Osborne, Counsel INTRODUCTION The Veteran had active service from June 1943 to November 1945. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an October 1957 rating decision issued by the Department of Veterans Affairs (VA) Regional Office (RO) in Los Angeles, California. In May 2010, the Board determined that statements on a VA Form 8-4138, "Statement In Support of Claim," dated on November 4, 1957, and date-stamped as received by the RO on November 6, 1957, constituted a valid notice of disagreement (NOD) with the October 1957 rating decision. The Board then remanded this claim for the issuance of a Statement of the Case (SOC). See Manlincon v. West, 12 Vet. App. 238, 240-241 (1999). The Veteran subsequently perfected a timely appeal. Please note this appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2010). 38 U.S.C.A. § 7107(a)(2) (West 2002). In a May 2011 Brief filed at the Board, the Veteran, through his attorney, appears to contend that the October 1957 rating decision constituted clear and unmistakable error (CUE) because the RO misapplied VA regulations on rating reductions then in effect. See 38 C.F.R. § 3.172 (1957), currently 38 C.F.R. § 3.344 (2010) (discussing rating reductions). The Veteran also filed a waiver of RO jurisdiction over the Brief. The Board notes in this regard that, in May 2010, it found the Veteran's November 1957 VA Form 8-4138 to be a valid NOD with respect to the October 1957 rating decision, making that rating decision not final for VA adjudication purposes. See 38 U.S.C. § 709 (1952); Veterans Administration Regulations No. 2(a), Part II, Par. III and 1008, currently 38 U.S.C.A. § 7105(c) (West 2002); 38 C.F.R. §§ 3.104, 20.302, 20.1103 (2010) (discussing finality of RO decisions). The Board also dismissed the Veteran's CUE claim with respect to the October 1957 rating decision. Given the favorable disposition of the Veteran's rating reduction claim in this decision, the Board finds that the allegations of CUE raised in the May 2011 Brief need not be addressed. A videoconference Board hearing was held at the RO in June 2011 before the undersigned Veterans Law Judge and a copy of the hearing transcript has been added to the record. FINDINGS OF FACT 1. In December 1945, the RO granted service connection for anxiety reaction (characterized as anxiety psychoneurosis), assigning a 50 percent rating effective December 1, 1945. 2. In April 1948, the RO reduced the disability rating from 50 percent to 30 percent effective June 2, 1948, for the Veteran's service-connected anxiety reaction (characterized as moderately severe anxiety state, rated as neurasthenia). 3. In June 1950, the RO reduced the disability rating from 30 percent to 10 percent effective May 12, 1950, for the Veteran's service-connected anxiety reaction. 4. In June 1952 and in September 1955, the RO confirmed and continued the 10 percent rating assigned for the Veteran's service-connected anxiety reaction. 5. In October 1957, the RO reduced the disability rating from 10 percent to zero percent effective December 15, 1957, for the Veteran's service-connected anxiety reaction. 6. The RO improperly reduced the disability rating from 10 percent to zero percent effective December 15, 1957, for the Veteran's service-connected anxiety reaction by relying on a single September 1957 VA examination which was less full and complete than VA examinations in May 1952 and in June 1955 which authorized and continued prior payments at the 10 percent disability rating. CONCLUSION OF LAW The rating reduction from 10 percent to zero percent effective December 15, 1957, for anxiety reaction was not warranted. Veterans Administration Regulations No. 1(a), Part I, Par. 1(a), and 1172(A) (1956); 38 C.F.R. § 3.172 (1957), currently 38 U.S.C.A. §§ 1155, 5103, 5103A, 5112(b)(6) (West 2002 & Supp. 2010); 38 C.F.R. §§ 3.103(b), 3.105(e), 4.1, 4.2, 4.7, 4.130, Diagnostic Code (DC) 9413 (2010). REASONS AND BASES FOR FINDINGS AND CONCLUSION In this decision, the Board grants entitlement to restoration of a 10 percent rating effective December 15, 1957, for anxiety reaction, which constitutes a complete grant of the Veteran's claim. Therefore, no discussion of VA's duty to notify or assist is necessary with respect to this rating reduction claim. The Veteran contends that the rating reduction from 10 percent to zero percent effective December 15, 1957, for anxiety reaction was improper. He specifically contends that the RO unlawfully relied upon a single VA examination in September 1957 which was less full and complete than 2 earlier VA examinations in May 1952 and in June 1955 which authorized and continued prior payments at the 10 percent disability rating. He also specifically contends that the RO's actions in the October 1957 rating decision directly contravened the regulation in effect at that time which governed rating reductions. See Veterans Administration Regulations (VAR) 1172(A) (1956); 38 C.F.R. § 3.172 (1957). Given the RO's failure to comply with the regulations governing rating reductions in 1957, the Veteran contends that the prior 10 percent disability rating for service-connected anxiety reaction should be restored effective December 15, 1957. As noted, in December 1945, the RO granted service connection for anxiety reaction (characterized as anxiety psychoneurosis), assigning a 50 percent rating effective December 1, 1945. In April 1948, the RO reduced the disability rating from 50 percent to 30 percent effective June 2, 1948, for the Veteran's service-connected anxiety reaction (characterized as moderately severe anxiety state, rated as neurasthenia). In June 1950, the RO reduced the disability rating from 30 percent to 10 percent effective May 12, 1950, for the Veteran's service-connected anxiety reaction. In June 1952 and in September 1955, the RO confirmed and continued the 10 percent rating assigned for the Veteran's service-connected anxiety reaction. It appears that the RO continued the 10 percent rating assigned for the Veteran's service-connected anxiety reaction in June 1952 and in September 1955 based on VA examinations in May 1952 and in June 1955, respectively, which showed no changes in this disability. There is a handwritten note on the September 1955 rating decision which indicates that the Veteran's 10 percent rating was confirmed and continued "under VAR 1172" for 24 months. The Board notes that the relevant regulation in effect in 1957 provided: Examinations less full and complete than those on which payments were authorized or continued will not be used as the basis for reduction...Ratings on account of diseases subject to temporary and episodic improvement...[including] manic-depressive or other psychosis...[and] psychoneurosis...will not be reduced on any one examination except in those instances where all the evidence of record clearly warrants the conclusion that permanent improvement of physical or mental condition has been demonstrated. See VAR 1172(A) (1956); 38 C.F.R. § 3.172 (1957). This regulation also provided at subparagraph (B) that: If, after according due consideration to all the evidence discussed in subparagraph (A) of this paragraph, doubt remains, the rating agency will continue the rating in effect, citing the former diagnosis with the new diagnosis in parentheses, and following the appropriate code there will be added the reference "Rating continued pending reexamination _____ months from this date, VA Regulation 1172." See VAR 1172(B) (1956); 38 C.F.R. § 3.172 (1957). In this case, the RO noted at the outset of the October 1957 rating decision that the Veteran's previous 10 percent rating for service-connected anxiety reaction had been continued "under VAR 1172" in the September 1955 rating decision. The Board notes that this appears to be a reference to VAR 1172(B). Id. A review of the September 1955 rating decision shows that the RO previously had confirmed and continued the 10 percent rating for the Veteran's service-connected anxiety reaction "under VAR 1172" for 24 months. Although the language used in the September 1955 rating decision referring to VAR 1172(B) did not track the language used in the regulation itself, the Board finds that, because that decision complied with VAR 1172(B), the RO properly confirmed and continued the 10 percent rating. Id. The Board also notes that the appellant, through his attorney, has contended that the reference to VAR 1172 in the September 1955 rating decision somehow was "misinterpreted" by the RO in the October 1957 rating decision because the appropriate citation was to 38 C.F.R. § 3.172 and this alleged misinterpretation of VAR 1172 by the RO constituted error. The Board observes in this regard that, because 38 C.F.R. § 3.172 codified the former VAR 1172, any error committed by the RO in referring to VAR 1172 rather than to 38 C.F.R. § 3.172 in the October 1957 rating decision was harmless. Similarly, any error committed by the RO in referring to VAR 1172 rather than 38 C.F.R. § 3.172 in the prior rating decision issued in September 1955 also was harmless. After citing to VAR 1172 and the prior rating decision issued in September 1955, the RO then discussed the results of the Veteran's September 1957 VA examination in the October 1957 rating decision. The RO noted in the October 1957 rating decision that the Veteran had reported at his September 1957 VA examination that he was self-employed and, since January 1956, had earned an average income of $400 monthly with a satisfactory social adjustment although he also was slightly worrisome. The RO concluded in October 1957 that the Veteran's social and economic adjustment and lack of neurological findings on VA examination indicated minimal nervous disability. Thus, the RO reduced the disability rating from 10 percent to zero percent effective December 15, 1957, for the Veteran's service-connected anxiety reaction. In an advisory opinion dated in February 2011, the Director, Compensation & Pension (C&P) Service, concluded that the October 1957 rating decision was in accordance with VAR 1172 and 38 C.F.R. § 3.172. It was noted that VAR 1172 "was the forerunner of 38 C.F.R. § 3.172 which was the actual regulatory provision extant at the time" of the October 1957 rating decision. It also was noted that VAR 1172 and 38 C.F.R. § 3.172 "were essentially similar in substance." The Director, C&P Service, determined that the Veteran had been examined in May 1952, June 1955, and September 1957, although the latter examination "was ultimately used as the basis for reduction." The Director, C&P Service, concluded that each of these examinations had been "full and complete" and the RO's actions in October 1957 complied with VAR 1172 and 38 C.F.R. § 3.172. The Veteran's attorney contended at the June 2011 videoconference Board hearing that the rating reduction implemented in the October 1957 rating decision was improper because it impermissibly relied upon a single VA examination in September 1957 which violated 38 C.F.R. § 3.172. The attorney emphasized that the Veteran sought reinstatement of the 10 percent rating which he had been receiving prior to December 15, 1957. The Veteran testified that his service-connected anxiety reaction had not changed between his May 1952, June 1955, and September 1957 VA examinations. He also testified that he had been unable to work more than part-time throughout this time period. The Board finds that the Veteran is entitled to restoration of a 10 percent rating for service-connected anxiety reaction effective December 15, 1957. The Veteran, through his attorney, has contended that the rating reduction implemented in the October 1957 rating decision was improper because it was based on a single VA examination in September 1957 which was "less full and complete" than prior VA examinations in May 1952 and in June 1955, respectively, "on which payments were authorized or continued." VAR 1172(A) (1956); 38 C.F.R. § 3.172 (1957). In other words, the Veteran has contended that, because the May 1952 and June 1955 VA examinations were more comprehensive than the September 1957 VA examination, and because the earlier VA examinations formed the basis for payments authorized or continued at the level of a 10 percent disability rating for service-connected anxiety reaction, the rating reduction implemented in the October 1957 rating decision was improper. The Board agrees with the Veteran's argument concerning the impropriety of the rating reduction challenged in this appeal. The evidence clearly shows that the RO impermissibly reduced the disability rating from 10 percent to zero percent effective December 15, 1957, for the Veteran's service-connected anxiety reaction based on a single VA examination in September 1957. This action directly contravened the relevant regulation in effect at that time governing rating reductions. See VAR 1172(A) (1956); 38 C.F.R. § 3.172 (1957). The RO did not find in the October 1957 rating decision that "all the evidence of record clearly warrants the conclusion that permanent improvement of physical or mental condition has been demonstrated" such that a rating reduction based on a single VA examination might have been permitted under the relevant regulation then in effect. Id. Nor is there any indication in the October 1957 rating decision that the RO relied upon any VA examination reports other than the September 1957 VA examination when it reduced the disability rating assigned for the Veteran's service-connected anxiety reaction (as the Director, C&P Service, seemed to suggest in his February 2011 advisory opinion). Instead, the RO relied upon a one-paragraph VA examination in September 1957 which the Board views as cursory at best especially when compared with the more comprehensive VA examinations in May 1952 and in June 1955 (each of which took over a page and a half of single-spaced text to describe the Veteran's psychiatric history, symptomatology, and examination results). Given the fatal procedural error that occurred in the October 1957 rating decision, which reduced the disability rating from 10 percent to zero percent effective December 15, 1957, for anxiety reaction, the Board finds that the Veteran is entitled to restoration of a 10 percent rating effective December 15, 1957, for his service-connected anxiety reaction. ORDER The rating reduction from 10 percent to zero percent effective December 15, 1957, for anxiety reaction was not warranted, and a 10 percent rating is restored effective December 15, 1957. ____________________________________________ ROBERT C. SCHARNBERGER Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs