Citation Nr: 1331309 Decision Date: 09/27/13 Archive Date: 10/01/13 DOCKET NO. 07-34 590A ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Albuquerque, New Mexico THE ISSUES 1. Entitlement to an extraschedular rating in excess of 50 percent for the Veteran's service-connected back disability. 2. Entitlement to total disability based on individual unemployability (TDIU). REPRESENTATION Veteran represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL Veteran ATTORNEY FOR THE BOARD Andrea Johnson, Associate Counsel INTRODUCTION The Veteran served on active duty from February 1972 to April 1975. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an August 2006 rating decision of the Department of Veterans Affairs (VA) Regional Office (RO) in Albuquerque, New Mexico. In June 2010, the Veteran testified in a Travel Board hearing before the undersigned Veterans Law Judge. A copy of the hearing transcript is associated with the claims file. This matter was previously before the Board in September 2010. In that decision, the Board remanded the issue of entitlement to an extraschedular evaluation for referral to the Director of Compensation and Pension Service. The Direct of Compensation and Pension Service denied an extraschedular evaluation and this matter returned to the Board. In May 2012 the Board granted a 10 percent extraschedular evaluation, resulting in a total 50 percent rating for the Veteran's service-connected back condition. The Veteran appealed the Board's May 2012 determination to the Court of Appeals for Veterans Claims (Court). In May 2013 the Court issued a Joint Motion for Partial Remand (JMR) of the May 2012 Board's grant, remanding the case for consideration of an extraschedular evaluation greater than "10 percent", as well as consideration of whether an inferred claim for total disability based on individual unemployability (TDIU) was raised. The Board, in light of the JMR, will address issue number (2). In this regard, it is important for the parties of the JMR and the Veteran to understand that the Veteran is not receiving a 40 percent "schedular evaluation" with a 10 percent "extraschedular evaluation" (two separate evaluations), but, as noted correctly within the July 2012 RO's rating action, a 50 percent extraschedular evaluation for the back (one rating action). This is important in terms of calculating the Veteran's overall disability evaluation. This appeal was processed using the VBMS paperless claims processing system. Accordingly, any future consideration of this Veteran's case should take into consideration the existence of this electronic record. In this regard, it is unclear if the May 2013 JMR was ever imputed into the paperless record. This oversight should be corrected. A copy of the JMR can be found on the Court's web site. In light of the JMR, the issue of entitlement to total disability based on individual unemployability (TDIU) is addressed in the REMAND portion of the decision below and is REMANDED to the RO via the Appeals Management Center (AMC), in Washington, DC. FINDING OF FACT The evidence of record reflects that the Veteran's service-connected back disability moderately impaired his average earning capacity. CONCLUSION OF LAW The criteria for an extraschedular evaluation in excess of 50 percent is denied. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. §§ 3.102, 3.321(b) (2013). REASONS AND BASES FOR FINDING AND CONCLUSION In exceptional cases where schedular evaluations are found to be inadequate, the RO may refer a claim to the Chief Benefits Director or the Director, Compensation and Pension Service, for consideration of "an extra-schedular evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities." 38 C.F.R. § 3.321(b)(1). "The governing norm in these exceptional cases is: A finding that the case presents such an exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of the regular schedular standards." Floyd v. Brown, 9 Vet. App. 88, 96 (1996). As discussed above, in an April 2011 Administrative Review the Director of the Compensation and Pension Service determined that an extraschedular rating was not warranted in this case. However in a May 2012 decision the Board granted an extraschedular rating of 50 percent for the Veteran's back condition. In a May 2013 JMR the Court remanded this issue stating the Board "provided an inadequate statement of reasons or bases with regard to whether an extraschedular rating greater than the 10-percent extraschedular rating assigned is warranted." (JMR 2) Specifically, the JMR stated that in the May 2012 decision the Board reasoned that extraschedular assessments were meant to "accord justice, " citing 38 C.F.R. § 3.321(b)(1). However, the JMR found that VA regulations do not say the appropriate extraschedular rating should be determined to "accord justice." Instead the regulation states extraschedular ratings will be allowed in order to accord justice but that the extraschedular rating assigned should contemplate an evaluation "commensurate with the average earning capacity impairment due exclusively to the service-connected disability." 38 C.F.R. § 3.321(b)(1). Accordingly the JMR ordered the Board to apply the correct standard and determine if an extraschedular rating in excess of "10 percent" was warranted. The schedular portion of the Veteran's back condition is currently rated under Diagnostic Code 5237, based on limitation of motion of the back. 38 C.F.R. § 4.71a. Because the Court did not vacate the portion of the September 2010 Board decision determining the Veteran was not entitled to a schedular rating in excess of 40 percent for his back condition, the appropriateness of the schedular rating assigned is no longer before the VA and will not be further addressed. The Board has again carefully reviewed and considered all evidence and determined that an extraschedular rating in excess of 50 percent is not warranted. Evidence relevant to the extraschedular consideration and impact of the Veteran's back condition on his earning capacity is summarized below: During the Travel Board hearing in June 2010, when questioned by the undersigned, the Veteran admitted that because of the pain to his back, he was able to sleep only three hours per night. The Veteran stated, "I'd get all these pillows and I'd turn this way, and lay down in the bed and then I'd get up and [the pain] wakes me up. I can't lay on my side. It has to be on my back, or nothing." Hearing transcript at 14. This testimony suggests the Veteran's back pain has caused a loss of sleep, a criteria not contemplated in the schedular criteria. In a June 2008 written statement the Veteran asserted he could not work due to his back, ankle, and other disabilities, including bilateral hip, bilateral knee, and a headache conditions. Importantly, the Veteran stated all these conditions made him unemployable. Accordingly this statement provides evidence the Veteran believes his back condition has contributed to his inability to work, but he does not assert he is currently unemployable due to his back condition alone, providing limited evidence against the Veteran's claim for an increased extraschedular rating. The Veteran was clear on this point. In this regard, it is important for the Veteran to understand that no one would dispute the statement that his back condition would contribute, along with several other disabilities, to his unemployment. A 50% back disability would clearly be part of any quandary associated with a failure of the Veteran not being able to work. The critical question before the Board at this time, however, is what should the Veteran's back disability be evaluated, notwithstanding any of the Veteran's other service connection or non-service connected disabilities. In August 2008, the Veteran was afforded a VA examination to evaluate his joint and back conditions. During range of motion testing of the Veteran's back the examiner noted the Veteran had pain with repetitive activity in all directions. He specifically noted "marked facial grimacing," "grunting," and "sweating" during this testing. The examiner also indicated the Veteran did not display any evidence of malingering. Additionally the examiner indicated that the Veteran experienced two to three flare-ups per year, lasting five to nine days each time. These flare-ups were described as "severe." The examiner indicated that the Veteran has "marked limitation of motion in the lumbar spine" and that the "limitation of motion with pain would prevent the [Veteran] from performing his [former] occupation as a production manager as he would be required to do considerable walking and be on his feet for most of the day." The examiner also concluded that the Veteran's back disability would prevent him from being qualified for a light occupation which is described as "capable of ambulating frequently." The examiner noted that the Veteran has marked limitation of walking capabilities on the basis of his back condition. As the Veteran would be required to sit for an extended period of time to do paperwork as a production manager, his back disability would prevent him from qualifying in the category of a sedentary occupation. The examiner also indicated that the Veteran would not be capable of a medium or heavy occupation as he would not be able to lift the requisite weight minimums. The Board finds this report provides some evidence the Veteran's back condition alone impaired the Veteran's earning capacity (a point not in dispute). In June 2012, since the Board's previous decision, the Veteran was provided with an additional VA examination to evaluate his back condition. The Veteran reported he had daily back pain at a grade of 5 to 7 out of 10 which got worse over time. Additionally he reported experiencing flares which severely limited his activity. The examiner indicated the Veteran's back condition caused the following functional impairments: more movement than normal, weakened movement, excess fatigability, incoordination, pain on movement, instability of station, disturbance of locomotion, and interference with sitting, standing, and/or weight-bearing. The examiner also noted the Veteran had guarding or muscle spasm, but these conditions did not result in abnormal gait or spinal contour. The examiner indicated the Veteran constantly used a cane and walker for his back condition and occasionally used a back brace. Finally the examiner opined the Veteran's painful back "moderately to severely" impaired his physical employment and "mildly to moderately" impaired his sedentary employment, providing additional evidence in support of an extraschedular rating. According, the Board finds the evidence tends to show the Veteran's back disability results in increased pain, functional and occupational impairment, and lack of sleep. Accordingly, a rating higher than that contemplated by the rating schedule is warranted to "accord justice." 38 C.F.R. § 3.321(b)(1). In assigning the level of schedular rating warranted VA regulations provide that the evaluation shall be "commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities." Id. The Court has held that the consideration of extraschedular ratings shall be made specific to each disability and not based on the collective basis of all the Veteran's service-connected disabilities. Johnson v. Shinseki, 26 Vet. App. 237 (2013). Based on the foregoing evidence the Board finds an extraschedular rating not to exceed 50 percent is warranted, for the Veteran's entire service-connected back disability. Essentially, the Board has awarded the Veteran the next highest percentage that is available under the rating schedule for the Veteran's back disability to consider the problems the Veteran uniquely has with this disability. In doing so, the Board has considered that while the schedular criteria for a disability rating in excess of 40 percent is not warranted (adjudicated in the September 2010 Board decision and not appealed), the Veteran's back disability does have an exceptionally disabling effect particularly on his abilities to ambulate and sleep due to pain, causing a fifty percent reduction in the Veteran's ability to function. This disabling effect, in turn, has impaired the Veteran's ability to perform some light, medium, and heavy occupations. The Board finds an extraschedular rating in excess of 50 percent is not warranted at this time. Although the Veteran's back condition has impaired the Veteran's ability to perform some occupations, the evidence does not establish the Veteran's service-connected back condition alone has resulted in an impairment of more than 50 percent total of the Veteran's average earning capacity. Most recently in the June 2012 VA examination the examiner specifically opined the Veteran's service-connected back condition "moderately to severely" impaired his physical employment and "mildly to moderately" impaired his sedentary employment. The Board finds moderate to severe impairment of physical employment and mild to moderate impairment of sedentary employment most closely approximately a 50 percent overall employment impairment. That is, the Veteran's back condition alone has caused an overall moderate impairment of his earning capacity. In this regard, it is important for the Veteran to understand that a 50% evaluation is a highly significant disability evaluation, indicating, very generally, a 50% reduction in the ability of the Veteran's industrial adaptability. It is only in taking into consideration the Veteran's complaints and concerns that the Board was able to come to this finding, overturning the finding of the VA Director of the Compensation and Pension Service and taking the Veteran's rating outside the normal schedular criteria. In this regard, the Board was attempting to provide the Veteran an evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability that takes into consideration his problems, as he has stated them at hearing before the undersigned. The assigning of an extraschedular rating is always complex, but the Board does have some "markers" in making this decision: (1) the Veteran does not meet the criteria for a higher evaluation under the rating criteria beyond 40% (an issue not on appeal); and (2) the Veteran's own statement suggests that it is not his back alone that is the cause of his unemployment, suggesting that while a 40% evaluation for his back may not be enough to compensate the Veteran for his back disability, a 100% disability evaluation is also not warranted for this disability. Based on these facts, the Board is seeking an evaluation that his higher than 40 percent but lower than 100% and that would not take into consideration the Veteran's other service connected and/or non-service connected disabilities. Because his back condition alone has not caused more than moderate impairment of his earning capacity, a total rating for his back condition in excess of 50 percent is not warranted. Accordingly, the Board finds an extraschedular rating in excess of 50 percent is not warranted at this time, for the reasons cited above. Duties to Notify and Assist Under applicable criteria, VA has certain notice and assistance obligations to veterans. See 38 U.S.C.A. §§ 5102, 5103, 5103A, 5107; 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326(a). In cases such as this, the typical service connection claim has been more than substantiated, it has been proven, thereby rendering 38 U.S.C.A. § 5103(a) notice no longer required because the purpose that the notice is intended to serve has been fulfilled. Dingess, 19 Vet. App. at 473; Dunlap v. Nicholson, 21 Vet. App. 112 (2007). Nevertheless, the record reflects that the Veteran was provided a meaningful opportunity to participate effectively in the processing of his claim for an increased rating on an extraschedular basis. Indeed, the Veteran's representative submitted a Post-Remand Brief in April 2012 and accurately included the criteria necessary to substantiate a claim for an increased rating on an extraschedular basis. As such, the Veteran had actual knowledge of the provision governing general rating considerations in exceptional cases and had a meaningful opportunity to participate in the adjudication of his claim such that the essential fairness of the adjudication was not affected. Vazquez-Flores v. Peake, 22 Vet. App. 37 (2008), vacated on other grounds sub nom. Vazquez-Flores v. Shinseki, 580 F.3d 1270 (Fed. Cir. 2009). The RO has also provided assistance to the Veteran as required under 38 U.S.C.A. § 5103A and 38 C.F.R. § 3.159(c), as indicated under the facts and circumstances in this case. Indeed service treatment records, VA treatment records, and records from the Social Security Administration have all been obtained and associated with the claims file. The Veteran indicated he did not receive any private treatment for his back condition. Additionally, the Board remanded this matter to the RO in September 2010 for referral of the claim to the Director of Compensation and Pension Service. The Director's April 2011 Administrative Review is associated with the claims file. The Veteran was also provided with a hearing before the undersigned VLJ in June 2010. In Bryant v. Shinseki, the United States Court of Appeals for Veterans Claims (Court) held that 38 C.F.R. 3.103(c)(2) requires that the VLJ who conducts a hearing fulfill two duties to comply with the regulation. They 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 this case, during the Board personal hearing, the VLJ fully explained the issue on appeal. The Veteran was assisted at the hearing by an accredited representative from the Disabled American Veterans, and the VLJ and the representative asked questions regarding the nature and etiology of the Veteran's claimed back condition, specifically regarding the impairment of the Veteran's back condition on his daily activities. In addition, the VLJ sought to identify any pertinent evidence not currently associated with the claims file that might have been overlooked or was outstanding that might substantiate the claim. No pertinent evidence that might have been overlooked and that might substantiate the claim was identified by the Veteran or his representative. Neither the Veteran nor his representative has asserted that VA failed to comply with 38 C.F.R. § 3.103(c)(2) or identified any prejudice in the conduct of the Board hearing. As such, the Board finds that, consistent with Bryant, the VLJ complied with the duties set forth in 38 C.F.R. § 3.103(c)(2), and that any error in notice provided during the Veteran's hearing constitutes harmless error. The Veteran was also provided with several VA examinations throughout the course of this appeal, the reports of which have been associated with the claims file. The Board finds the VA examinations were thorough and adequate and provide a sound basis upon which to base a decision with regard to the Veteran's claim. The VA examiners personally interviewed and examined the Veteran, including eliciting a history from him, and provided the information necessary to evaluate his disability. Furthermore, neither the Veteran nor his representative has voiced any issue with the adequacy of the examinations. As discussed, VA has satisfied its duties to notify and assist, and additional development efforts would serve no useful purpose. See Soyini v. Derwinski, 1 Vet. App. 540, 546 (1991); Sabonis v. Brown, 6 Vet. App. 426, 430 (1994). Because VA's duties to notify and assist have been met, there is no prejudice to the Veteran in adjudicating this appeal. ORDER Entitlement to an extraschedular rating in excess of 50 percent for service-connected back condition is denied. REMAND In the May 2013 JMR the Court also stated the Board "failed to address whether [the Veteran] re-raised his claim for total disability based on individual unemployability (TDIU) in his June 2010 hearing testimony." In this regard, as discussed in the September 2010 Board decision, in a report of contact from December 2009, the Veteran clarified that he was not continuing a claim for TDIU. Given that the Veteran's claim for TDIU was readjudicated by the RO in an April 2009 rating decision and the Veteran clarified that he was not pursuing an appeal of the April 2009 denial of TDIU, the Board emphasized that the issue of TDIU was not before the Board at this time. The Board acknowledges that in his June 2010 hearing the Veteran testified that his back and knee conditions made him unable to work. Therefore despite clearly stating he was not pursuing an appeal of the April 2009 denial of TDIU in December 2009 the Veteran's statements in June 2010 were indicated by the JMR to override the Veteran's written statement or the full adjudication of this claim by the RO, without appeal. In any event, since the Board's previous decision in September 2010, in February 2011 the Veteran submitted a formal application for increased compensation based on individual unemployability, initiating a new appeal regarding this issue. Because the Veteran filed a formal new claim for TDIU such a claim does not also need to be inferred from his June 2010 testimony. The RO then developed the Veteran's new claim for TDIU, including providing a VA examination in June 2012 in which the examiner specifically considered the impact of the Veteran's service-connected back and lower extremity conditions on his ability to secure and maintain substantially gainful employment. After this development the RO adjudicated the Veteran's claim in a July 2012 and denied his claim for TDIU. Most recently in April 2013 the Veteran's representative submitted a new claim for entitlement to TDIU. In September 2013 the RO sent a letter to the Veteran informing him they were working on his claim for TDIU and requesting additional information from the Veteran. Accordingly, the Board finds the issue of entitlement to TDIU is currently being adjudicated by the RO. This is complex situation. The Board recognizes that TDIU is a component of any claim for an increase in disability rating where evidence of unemployability is reasonably raised by the record under Rice v. Shinseki, 22 Vet. App. 447, 453-54 (2009). Accordingly under Rice the Veteran's claim of TDIU is a component of the current claim for an extraschedular rating in excess of 50 percent and is therefore before the Board (the prior Board decision has been vacated). However, as discussed, this issue is also currently being adjudicated by the RO. Therefore remand is required for the RO to submit a supplemental statement of the case (SSOC) in consideration of the additional information obtained during development and before this matter may be returned to the Board, in light of the new evidence and the actions now being undertaken by the RO. Accordingly, the case is REMANDED for the following action: Once the actions the RO was undertaking to develop the Veteran's current TDIU claim have been fully developed by the RO/AMC, issue a supplemental statement of the case concerning entitlement to total disability based on individual unemployability (TDIU), including consideration of all recent development. 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 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). ______________________________________________ JOHN J. CROWLEY Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs