Citation Nr: 1327866 Decision Date: 08/30/13 Archive Date: 09/05/13 DOCKET NO. 05-41 039 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Winston-Salem, North Carolina THE ISSUE Whether an April 2005 determination that terminated an award of compensation benefits awarded in an August 2003 decision was proper. ATTORNEY FOR THE BOARD R. Kessel, Counsel INTRODUCTION The Veteran had active military service from February 1950 to December 1953 and from November 1959 to August 1988. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an April 2005 decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Winston-Salem, North Carolina. In a March 2009 decision, the Board denied entitlement to VA disability compensation benefits during a period from March 1, 1997 through the end of July 2002, during which the Veteran renounced VA benefits in lieu of military retirement pay. The Veteran appealed this decision to the United States Court of Appeals for Veterans Claims (Court). In a March 2011 Memorandum Decision, the Court vacated the Board's March 2009 decision and remanded the matter to the Board for further proceedings consistent with the Court's decision. Thereafter, in December 2011, the Board again denied entitlement to VA disability compensation benefits during a period from March 1, 1997 through the end of July 2002, during which the Veteran renounced VA benefits in lieu of military retirement pay. The Board also denied the claim that VA had wrongly garnished VA disability compensation payments in the amount of $27,664 pursuant to a state court garnishment order. The Veteran appealed this decision to the Court. In a December 2012 Memorandum Decision, the Court determined that the claim for entitlement to VA disability compensation benefits during a period from March 1, 1997 through the end of July 2002, during which the Veteran renounced VA benefits in lieu of military retirement pay, was deemed abandoned. However, the Court also vacated the Board's December 2011 decision and remanded the matter to the Board for further proceedings consistent with the Court's decision. This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2012). 38 U.S.C.A. § 7107(a)(2) (West 2002). The appeal is REMANDED to the RO via the Appeals Management Center (AMC), in Washington, DC. VA will notify the appellant if further action is required. REMAND In the December 2012 Memorandum Decision, the Court held that the Board's December 2011 decision did not comply with the Court's prior March 2011 Memorandum Decision. See Stegall v. West, 11 Vet. App. 268, 271 (1998). In response to the Court's March 2011 decision, the Board expanded the matter on appeal in December 2011 to include the issue of whether VA had wrongly garnished VA disability compensation payments in the amount of $27,664 pursuant to a state court garnishment order. The Court noted that it was unclear whether that was the proper issue on appeal. This was so because the Court found that an August 2003 award by VA created a property interest entitled to due process protection, and that right of entitlement could not properly be discontinued without due process. See Cushman v. Shinseki, 576 F.3d 1290, 1298 (Fed. Cir. 2009). According to the Court, in the April 2005 decision on appeal, the RO made a substantive legal determination when the benefit awarded in the August 2003 decision was terminated. Thus, the Board did not address the Veteran's appeal of the April 2005 decision against the backdrop of the prior August 2003 award. By way of background, the August 2003 award determined that the Veteran's compensation benefits were erroneously withheld from February 1, 1992 through February 28, 1997, which equated to $27,664. The August 2003 decision also noted that compensation benefits were not payable from March 1, 1997 to August 1, 2002, because the Veteran had renounced his compensation benefits. Finally, the RO indicated that the Veteran would be paid as a single veteran with no dependents effective August 1, 2002 and did not indicate that any benefits would be withheld due to a state court garnishment order. In the April 2005 decision, with the August 2003 decision as a backdrop, the RO determined that it erred in the prior decision when it terminated the garnishment that was previously in place. The RO further indicated that the garnishment order was valid and that the RO must garnish the Veteran's compensation benefits in the amount of $971.60 per month. Therefore, the RO "terminated" the benefit awarded in the August 2003 decision; that is, the payment of non-garnished compensation benefits. In view of the above, the Board finds it necessary to remand the case to ensure compliance with due process in the termination of the property interest awarded in the August 2003 decision. Significantly, in an October 2005 statement of the case, the RO noted that the resumption of garnishment was not part of the appeal. However, in the March 2011 Memorandum Decision, the Court stated that "[the Veteran] is appealing the RO's April 2005 decision..." Additionally, the Court noted in the December 2012 Memorandum Decision that VA concedes that the April 2005 decision is "the agency determination from which the instant appeal stems," when the Court referred to VA General Counsel's June 2012 Appellee's Brief to the Court. Accordingly, on remand, the RO will have the opportunity to adjudicate the proper issue on appeal with consideration of the evidence of record and in light of any due process concerns. "Due process of law has been interpreted to include notice and a fair opportunity to be heard." Cushman, 576 F.3d at 1296 (citations omitted). The Board notes that the RO did send the Veteran a letter dated in January 2005 in which it notified him of the RO's intent to withhold $971.60 per month due to the state court garnishment order. The RO provided the Veteran with 20 days to submit information to support a different amount of withholding. The regulations provide that no award of compensation shall be terminated, reduced or otherwise adversely affected unless the beneficiary has been notified of such adverse action and has been provided 60 days in which to submit evidence for the purpose of showing that the adverse action should not be taken. 38 C.F.R. § 3.103(b)(2) (2012). A claimant is also entitled to a hearing at any time on any issue involved in a claim. 38 C.F.R. § 3.103(c). In addition, where a reduction or discontinuance of benefits is warranted by reason of information received concerning income, net worth, dependency, or marital or other status, a proposal for the reduction or discontinuance will be prepared setting forth all material facts and reasons. The beneficiary will be notified at his or her latest address of record of the contemplated action and furnished detailed reasons therefor, and will be given 60 days for the presentation of additional evidence to show that the benefits should be continued at their present level. 38 C.F.R. § 3.105(h) (2012). Moreover, in the advance written notice, the beneficiary will be informed that he or she will have an opportunity for a predetermination hearing. 38 C.F.R. § 3.105(i). Notably, exceptions exist to § 3.103(b)(2) and § 3.105(h), (i) where VA will send a written notice to the beneficiary at the same time it takes an adverse action. See 38 C.F.R. §§ 3.103(b)(3), 3.105(h). One exception is for an adverse action based upon a garnishment order issued under 42 U.S.C. § 659(a). 38 C.F.R. § 3.103(b)(3)(vi). That section of the United States Code pertains to the consent by the United States to income withholding, garnishment, and similar proceedings for enforcement of child support and alimony obligations. Lastly, as to the previously garnished VA disability compensation payments in the amount of $27,664, VA Compensation and Pension Award forms in the claims file document that amount and it appears that this was paid after the August 2003 award. Additionally, in a January 2004 statement, the Veteran stated "I was reimbursed $27,664.00 in erroneously garnished waived retired pay for the period February 1, 1992, to February 28, 1997..." In a February 2005 statement, the Veteran stated that he "was reimbursed $27,664 in August 2003." Thus, this aspect is not in controversy as it appears that the Veteran has received those funds and has acknowledged as much. Accordingly, this case is REMANDED for the following actions: 1. Ensure all due process requirements are met for the Veteran concerning the termination of benefits awarded in the August 2003 decision (i.e., the withholding of $971.60 per month due to the state garnishment order), including any necessary notice and hearing requirements. 2. Then, after undertaking any other development deemed appropriate, adjudicate the issue of whether an April 2005 determination that terminated an award of compensation benefits awarded in an August 2003 decision was proper. If any benefit sought is not granted, furnish the Veteran with a supplemental statement of the case and afford him an opportunity to respond before the record is returned to the Board for further review. No action is required of the Veteran until he is notified by VA. The Veteran has the right to submit additional evidence and argument on the matter the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). This case must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board or by the Court for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West Supp. 2013). _________________________________________________ DENNIS F. CHIAPPETTA Veterans Law Judge, Board of Veterans' Appeals Under 38 U.S.C.A. § 7252 (West 2002), only a decision of the Board is appealable to the Court. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (2012).