Citation Nr: 1329410 Decision Date: 09/13/13 Archive Date: 09/20/13 DOCKET NO. 11-05 885 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Columbia, South Carolina THE ISSUE Whether the debt for an overpayment of non-service-connected pension benefits in the currently calculated amount of $22,372.00 was properly created and calculated and, if there is a properly created and calculated overpayment debt, whether the Veteran is entitled to waiver of recovery of that debt. REPRESENTATION Appellant represented by: The American Legion WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD M. Hannan, Counsel INTRODUCTION The Veteran appellant served on active duty in the United States Army from January 1973 to May 1973. This case comes before the Board of Veterans' Appeals (Board) on appeal from an August 2010 determination issued by the Committee on Waivers and Compromises (COWC) at the Philadelphia, Pennsylvania, Regional Office (RO) and Insurance Center (IC) of the Department of Veterans Affairs (VA). The Columbia, South Carolina RO otherwise has jurisdiction of the claims file. The August 2010 COWC decision considered the question of waiver of recovery of an overpayment of non-service- connected pension benefits of $22,372.00, and denied a waiver of that overpayment based on a finding that the appellant had had income in excess of the maximum amount allowed for payment of a pension to a veteran with one dependent. The COWC also concluded that the appellant had not acted in bad faith, that a failure to seek restitution would result in unjust enrichment to the appellant and that repayment of the debt might impair his ability to provide for basic necessities. In August 2011, a Travel Board hearing was held at the Columbia, South Carolina RO before the undersigned Veterans Law Judge. A transcript is in the claims file. In addition to the paper claims files, there is an electronic file (Virtual VA) associated with the claim. Virtual VA does currently contain evidence pertinent to the claim that is not already included in the paper claims files. 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 A determination has been made that additional evidentiary development is necessary. Accordingly, further appellate consideration will be deferred; this case is remanded for action as described below. The evidence of record reflects that the appellant was granted non-service-connected pension benefits in a rating issued in August 2007. These benefits were payable from March 26, 2007. It also appears from the evidence of record that payments were made through June 2010. The appellant submitted his initial claim for pension benefits in March 2007. He reported that he was receiving $1212.00 per month in unemployment benefits. He also stated that he would receive $7272.00 (six months) in unemployment benefits in the next 12 months. The appellant further reported that he had a total of $902.11 in unreimbursed medical expenses per month ($10,825/year). An August 2007 rating action awarded pension benefits in the amount of $1,192 per month based on the information the appellant provided in his application. In a VA Form 21-0516 dated in February 2008, the appellant reported that his unemployment benefits had stopped in April 2007. In a May 2008 letter, the RO informed the appellant that his pension benefits had been reduced to $586.00 per month effective April 1, 2007. This was based on a finding that the appellant's unreimbursed medical expenses were $487.65 instead of $10,825 as reflected in the appellant's medical expense report. The reduction in medical expenses therefore increased the appellant's income and created an overpayment; the overpayment was calculated in the amount of $7878.00. In June 2008, the COWC granted the appellant's request for a waiver of the debt and found that collection of the debt of $7878.00 would be against equity and good conscience. On December 1, 2009, the RO received notice from the appellant that he had been approved for Social Security Administration (SSA) disability benefits in the amount of $1500. The appellant also stated that these benefits would start on December 1, 2009. The RO subsequently undertook verification of the figures provided by the appellant. A February 2010 letter to the appellant indicated that income besides his unemployment benefits, namely interest income of $1,000 and wages of $3,570, had been identified. The Board notes that the appellant has never specifically addressed these identified sources of income. In June 2010, the appellant was informed that his pension benefit had been changed to $0, effective from April 1, 2007 through June 2010, and that an overpayment had been created thereby. In his October 2010 Notice of Disagreement, the appellant indicated that there had been confusion over his unemployment benefits. He also pointed out that a waiver of overpayment had been already been granted. The appellant continued to express a lack of understanding as to how the overpayment was calculated during his August 2011 Travel Board hearing testimony. A debtor may dispute the amount or existence of a debt, which is a right that may be exercised separately from a request for waiver or at the same time. See 38 C.F.R. § 1.911(c)(1) (2012); see also VAOPGCPREC 6-98 (Apr. 24, 1998). The propriety and amount of the overpayment at issue are matters that are integral to a waiver determination. See Schaper v. Derwinski, 1 Vet. App. 430, 434 (1991). The Board presumes that, by these statements, the appellant intended to challenge the creation and/or the calculation of his indebtedness. The Board notes that it is unclear from a review of the evidence of record what calculations were used in determining that a $22,372.00 overpayment had been created, in part because the appellant's benefit amount was recalculated a number of times, because his unemployment benefits only occurred during a portion of the period at issue, because SSA disability benefits started during the period at issue and because a waiver of overpayment of pension benefits in the amount of $7,878.00 was granted in June 2008. It is also unclear whether the appellant was entitled to pension benefits during a period of time during which he received no unemployment benefits and had no income prior to his initial receipt of SSA disability benefits. The appellant testified at his August 2011 Travel Board hearing that he had received unemployment benefits from March 5, 2007 to August 27, 2007. It appears from the evidence of record that SSA found the onset date of the appellant's disability to be in February 2007, with an initial benefit entitlement date in August 2007. As previously noted, the appellant reported to VA that he was to begin receipt of SSA benefits as of December 2009. The Board therefore finds that a remand for development is necessary with regards to the issue of whether the debt as calculated is correct. In particular, the August 2010 letter from the COWC does not delineate how the amount of the debt was calculated. It is unclear from a review of the evidence of record what calculations were used in determining that a $22,372.00 overpayment had been created, in part because the income and medical expense amounts reported by the Veteran and his spouse have varied over time. Accordingly, it will be necessary for the RO to adjudicate the issue of the creation and calculation of the Veteran's debt and thereby provide clarification as to the calculations and figures used in determining the amount of the overpayment. Once the RO has adjudicated this issue, the COWC may readjudicate the Veteran's request for waiver of recovery of any debt that is found by the RO to validly exist. Therefore, to ensure full compliance with due process requirements, this case is REMANDED to the AMC/RO for the following: 1. Make certain that all notification and development action required by 38 U.S.C.A. §§ 5102, 5103, and 5103A, the implementing regulations found at 38 C.F.R. § 3.159, and any other applicable legal precedent has been completed. 2. Obtain and associate with the claims file any outstanding documents relating to the claim on appeal, to include any correspondence from the Columbia RO, the COWC and the Philadelphia RO and Insurance Center. 3. Thereafter, provide the Veteran an audit of his account in writing, which clearly shows the date of the start of pension benefit payments, the amount of the pension benefit, the date of the reduction or cessation of the pension benefit and the reason for the reduction or cessation. The audit and accompanying letter must clearly explain to the Veteran the creation of the amount of any debt or overpayment that was assessed against him and take into account the June 2008 waiver of overpayment in the amount of $7,878.00. Set forth in the record a chart reflecting for the entire period beginning April 1, 2007, and ending when pension benefits were terminated: a. Month-by-month amounts of pension benefits paid to the Veteran as shown by a paid and due audit; b. Month-by-month amounts of the Veteran's total family income from all sources; and c. Month-by-month amounts of the Veteran's total deductable medical expenses. 4. A copy of the audit and a copy of the chart must be placed in the claims file. The Veteran must be provided an appropriate opportunity to respond. 5. Following completion of the above- referenced development, determine whether the Veteran's debt was properly created and, if so, whether the amount of such debt was correctly calculated. Address the issue of administrative error and set forth in detail the bases for the calculation of the amount of the debt, to include the June 2008 waiver of $7,878.00. 6. Inform the Veteran of: a. The determination as to the creation and calculation of any indebtedness; and b. His appellate rights as they pertain to such determination. If he files a notice of disagreement on this issue, a statement of the case should be issued, and the Veteran and his representative must be afforded the appropriate amount of time to perfect his appeal to the Board by filing a substantive appeal. 7. The COWC must then review the waiver claim and determine whether such a waiver is warranted under applicable laws and regulations. 8. If the decision of the COWC remains adverse to the Veteran, then he and his representative must be furnished an appropriate supplemental statement of the case (SSOC). The SSOC must contain notice of all relevant actions taken on the waiver claim, to include a summary of the evidence and applicable law and regulations considered pertinent to the issue currently on appeal. An appropriate period of time for response must be allowed. The appellant has the right to submit additional evidence and argument on the matter the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). Thereafter, the case should be returned to the Board, if in order. The Board intimates no opinion as to the ultimate outcome of this case. The Veteran need take no action unless otherwise notified. This claim must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West Supp. 2012). _________________________________________________ KATHLEEN K. GALLAGHER Veterans Law Judge, Board of Veterans' Appeals Under 38 U.S.C.A. § 7252 (West 2002), only a decision of the Board of Veterans' Appeals is appealable to the United States Court of Appeals for Veterans Claims. 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).