Citation Nr: 1416002 Decision Date: 04/10/14 Archive Date: 04/24/14 DOCKET NO. 11-34 124 ) DATE ) ) Received from the Department of Veterans Affairs Regional Office in St. Louis, Missouri THE ISSUE Whether the overpayment of Department of Veterans Affairs (VA) pension benefits in the amount of $13,949.90 was validly created. REPRESENTATION Veteran represented by: Daniel G. Krasnegor, Attorney WITNESS AT HEARING ON APPEAL The Veteran ATTORNEY FOR THE BOARD M. M. Olson, Associate Counsel INTRODUCTION The Veteran served on active duty from October 1972 to January 1974. This matter comes to the Board of Veterans' Appeals (Board) on appeal from a January 2006 determination by the Department of Veterans Affairs (VA) Debt Management Center (DMC) at Fort Snelling, Minnesota. Jurisdiction rests with the VA Regional Office (RO) in St. Louis, Missouri, from which the appeal was certified. In March 2008, the Veteran testified before the undersigned Veterans Law Judge (VLJ) at a hearing held at the RO in St. Louis, Missouri. A transcript of the hearing is associated with the record. The Veteran and his representative also submitted additional evidence directly to the Board with a waiver of initial RO consideration. As such, this evidence is accepted for inclusion in the record on appeal. See 38 C.F.R. §§ 20.800, 20.1304 (2013). In a May 2008 decision, the Board denied the Veteran's claim of entitlement to a waiver of overpayment of VA nonservice-connected pension benefits in the amount of $13,949.90. In the decision, the Board found the issue as to whether the entire debt was justified was not on appeal. Subsequently, the Veteran appealed the Board's May 2008 decision to the United States Court of Appeals for Veterans Claims (Court). In a July 2007 Memorandum Decision, the Court vacated the Board's decision and remanded the case. In August 2010, the Board remanded the issue as to whether the overpayment of VA pension benefits in the amount of $13,949.90 was validly created, to include whether the Veteran timely disputed the validity of the creation of the overpayment debt, to the RO for additional development. Upon review, the Board finds the RO substantially complied with the August 2010 remand directives. See 38 U.S.C.A. § 5103A(b); Stegall v. West, 11 Vet. App. 268 (1998). The RO determined that the Veteran had filed a timely disagreement as to the validity of the creation of the indebtedness and adjudicated the issue in an October 2011 statement of the case. In December 2011, the Veteran's representative submitted a written statement as a substantive appeal in lieu of VA Form 9, and the RO certified the issue to the Board for appellate review. FINDINGS OF FACT 1. Effective from December 3, 1996, the Veteran has been in receipt of VA nonservice-connected pension benefits. 2. On June 30, 2003, a warrant for the Veteran's arrest was issued in Wright County (Missouri) for second degree assault and attempt to escape confinement, both of which are felonies in the State of Missouri. 3. VA received notice of the warrant in March 2004, and in December 2004, the Veteran's pension benefits were suspended, effective June 30, 2003. 4. The Veteran has been charged with an overpayment of VA pension benefits based on his status as a fugitive felon during the period from June 30, 2003 to December 1, 2004; there is no evidence the overpayment amount of $13,949.90 was improperly calculated. 5. The Veteran was at fault in the creation of the debt in failing to resolve felony charges against him in the State of Missouri. CONCLUSION OF LAW An overpayment of VA pension benefits in the valid amount of $13,949.90 was properly created. 38 U.S.C.A. §§ 5107, 5313B (West 2002); 38 C.F.R. § 3.102, 3.665 (2013). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veterans Claims Assistance Act of 2000 (VCAA) describes VA's duty to notify and assist claimants in substantiating a claim for VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126 (West 2002 & Supp. 2013); 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326(a) (2013). The Court has held, however, that VCAA notification procedures do not apply in cases where the applicable chapter of Title 38, United States Code contains its own notice provisions. See Barger v. Principi, 16 Vet. App. 132 (2002). The Board finds that general due process concerns have been satisfied in connection with the issue on appeal. Prior to reducing or terminating an award of pension, VA is required to comply with pertinent VA regulations concerning due process. Specifically, VA must create a proposal for the reduction that sets forth all material facts and reasons, notify the beneficiary of the contemplated action at his or her latest address of record, and furnish detailed reasons thereof. The beneficiary must be given 60 days for the presentation of additional evidence to show that compensation payments should be continued at the present level. 38 C.F.R. §§ 3.103(b), 3.105 (2013). In a March 2004 letter, the RO complied with the procedures set forth above and notified the Veteran of the proposed termination of pension benefits. The record shows this correspondence was mailed to the Veteran's last address of record and does not indicate that it was returned as undeliverable. In Bryant v. Shinseki, 23 Vet. App. 488 (2010), the Court held that 38 C.F.R. § 3.103(c)(2) (2013) requires that the VLJ who conducts a hearing fulfill two duties to comply with the above regulation. These duties consist of (1) the duty to fully explain the issues and (2) the duty to suggest the submission of evidence that may have been overlooked. In a March 2008 hearing, the VLJ noted the elements necessary to substantiate the claim and asked questions to ascertain the circumstances surrounding the warrant and the subsequent creation of the debt. The VLJ also solicited information to determine whether there existed pertinent evidence that might have been overlooked and that might substantiate the claim. The hearing focused on the elements necessary to substantiate the claim, and the Veteran, through his testimony, demonstrated that he had actual knowledge of the elements necessary to substantiate the claim. The Veteran has not suggested any deficiency in the conduct of the hearing and was assisted at the hearing by his representative. Therefore, the Board finds that, consistent with Bryant, the VLJ complied with the duties set forth in 38 C.F.R. § 3.103(c)(2). An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits to which he or she is not entitled. 38 U.S.C.A. § 5302 (West 2002); 38 C.F.R. § 1.962 (2013). An overpayment may arise from virtually any benefits program administered pursuant to VA law, including pension and compensation. 38 C.F.R. § 1.956(a) (2013). A claimant has the right to dispute the existence and amount of a debt. 38 U.S.C.A. § 501 (West 2002); 38 C.F.R. § 1.911(c) (2013). In this case, the Veteran asserts that because he was unaware of the outstanding warrant, he should not be considered a fugitive felon under VA law. In addition, the Veteran asserts that VA failed to timely notify him of the circumstances necessitating the suspension of benefits and then unnecessarily waited to effectuate the suspension, thus contributing to the growth of the debt. A veteran eligible for pension benefits may not be paid such benefit for any period during which he is a fugitive felon. 38 U.S.C.A. § 5313B. The implementing regulation applicable in this case, 38 C.F.R. § 3.666, provides that pension is not payable on behalf of a veteran for any period during which he or she is a fugitive felon. The term fugitive felon means a person who is a fugitive by reason of: (i) fleeing to avoid prosecution or custody or confinement after conviction for an offense, or an attempt to commit an offense, which is a felony under the laws of the place from which the person flees; or (ii) violating a condition of probation or parole imposed for commission of a felony under the Federal or State law. The term felony includes a high misdemeanor under the laws of a State which characterizes as high misdemeanors offenses that would be felony offenses under Federal law. 38 C.F.R. § 3.666(e). The Court has held that an adjudication of guilt is not required under 38 U.S.C.A. § 5313B for a Veteran to be considered a fugitive felon and that actual knowledge that a warrant had been issued is not part of the statutory requirement. In this case, VA records show an overpayment was created based upon the receipt of information that a warrant had been issued for the Veteran in June 2003 for the charges of second degree assault and attempt to escape confinement, both of which constitute felonies under the laws of the State of Missouri. A court approved surety was set in the amount of $20,000.00. Records from the State of Missouri Associate Circuit Court Division in Wright County include a probable cause statement, which details how the Veteran attacked an arresting officer and attempted to flee police custody on the day in question. The warrant remained outstanding until the Veteran was arrested on August 1, 2005 and pled guilty to the charge of attempted escape from custody. VA records show the Veteran was notified by correspondence dated in March 2004 of a proposal to terminate his VA pension benefits, effective June 30, 2003, based upon evidence of a warrant for his arrest having been issued on that date. The Veteran has been in receipt of VA nonservice-connected pension benefits from December 3, 1996. The Veteran did not respond to the March 2004 notice letter, and on December 1, 2004, VA terminated his pension benefits and notified the Veteran of this action. A VA Audit shows the Veteran's monthly rate from June 30, 2003 to December 1, 2003 was $807.00, and from December 31, 2003 to December 1, 2004, his monthly rate was $824.00. Accordingly, an overpayment in the amount of $13,949.90 was created. The Veteran asserts that he had no knowledge of the outstanding warrant, and therefore, he should not be considered a fugitive felon under VA law. In a November 2006 written statement, the Veteran contended that on the day of the incident, he was actually arrested for two outstanding traffic tickets and subsequently spent 18 days in jail for those tickets. The Veteran reported that he was not booked or charged for the second degree assault or attempted escape from confinement during that time, and in support of this statement, the evidence shows the warrant was issued in June 2003, one month following the incident. In his statement, he claimed that he received no notice of the warrant until the December 2004 letter from the RO notifying him of the termination of his benefits. The Veteran asserts that he acted immediately thereafter to clear the warrant and would have done so at an earlier date if he had been aware of his fugitive felon status. The evidence shows a private attorney appeared before the Associate Circuit Court Division in Wright County in January 2005, which corroborates the Veteran's statements regarding his actions to clear the warrant following the December 2004 notice letter. Based upon the evidence, however, the Board finds the Veteran was a fugitive felon for VA pension purposes for the period from June 30, 2003 to August 1, 2005. In a case specifically addressing the applicability of statutes and regulations concerning a "fugitive felon" and the termination of VA benefits, the Court in Mountford held that actual knowledge that a warrant had been issued is not part of the statutory requirement. See Mountford v. Shinseki, 24 Vet. App. 443 (2011). The evidence clearly shows the Veteran was the subject of a felony warrant and avoided prosecution until August 1, 2005. In addition, correspondence dated in June 2011 shows the VA Office of Inspector General (OIG) found the Veteran was in fugitive felon status from June 30, 2003 to August 1, 2005 because he was the subject of a valid outstanding felony arrest warrant. The OIG further found "it would be pure speculation to know for certain if the Veteran was aware or not to the existence of the felony warrant" and determined that no waiver should be granted as the felony warrant was valid and subsequently served. The Board finds this determination supports the Court's finding in Mountford that actual knowledge of the existence of the warrant is not pertinent to the legal question of fugitive felon status. Here, the Board recognizes the Veteran's assertions regarding his lack of knowledge of the warrant and his subsequent actions to clear the warrant. However, the Board finds the Court's determination in Mountford and the OIG's findings more probative with respect to whether the Veteran was considered a fugitive felon for VA pension purposes. Therefore, the Veteran was not entitled to payment of benefits during the period from the issuance of the warrant to the date the warrant was cleared. Benefits were improperly paid from June 30, 2003 to December 1, 2004, and the Veteran has not disputed the amount of the benefits he was paid. The overpayment was not due to the sole administrative error of VA. Accordingly, the evidence shows that the overpayment was properly created. With respect to the amount of the debt, the Veteran contends that a large part of the debt was due to VA administrative error as he did not receive the initial March 2004 letter notifying him of his status as a fugitive felon. In addition, the Veteran argues the VA did not terminate his benefits until December 1, 2004, which contributed to the growth of the debt. First, the record shows VA did not receive notice of the warrant until March 2004. In addition, the evidence includes a copy of the March 2004 notice letter, which was sent to the Veteran's last address of record, and there is no evidence showing it was returned as undeliverable. See Mindenhall v. Brown, 7 Vet. App. 271, 274 (1994) (citing Ashley v. Derwinski, 2 Vet. App. 62, 64-65 (1992) (discussing that the presumption of regularity of the administrative process applies to notices mailed by the VA)). In addition, at the March 2008 hearing, the Veteran admitted that he had changed residences a couple of times during the period in question and that there was the possibility that the RO had mailed the March 2004 letter to a wrong address. The evidence does not demonstrate that the Veteran notified VA of any address changes during that period. As clear evidence to the contrary is required to rebut the presumption of regularity, the Board finds the Veteran was made aware of his fugitive felon status and the proposed reduction of pension benefits in March 2004 to his most recent address of record. All benefits accepted after notification of non-entitlement are the responsibility of the payee. Consequently, the amount of the debt is valid. In view of the above, the Board concludes that the overpayment of VA pension benefits in the amount of $13,949.90 was validly created. As the preponderance of the evidence is against the claim, the claim must be denied. 38 U.S.C.A. § 5107(b) (West 2002); Gilbert v. Derwinski, 1 Vet. App. 49, 50 (1990). ORDER The overpayment of VA pension benefits in the amount of $13,949.90 was validly created. ____________________________________________ U. R. POWELL Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs