Citation Nr: 1338239 Decision Date: 11/21/13 Archive Date: 12/06/13 DOCKET NO. 10-44 040A ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Philadelphia, Pennsylvania THE ISSUE Legal entitlement to all (or any portion of) the Veteran's non-negotiated payment for retroactive VA benefits ($32,617.00), for purposes of accrued benefits. REPRESENTATION Appellant represented by: Veterans of Foreign Wars of the United States WITNESSES AT HEARING ON APPEAL Appellant and M.G. ATTORNEY FOR THE BOARD L. B. Yantz, Counsel INTRODUCTION The appellant is the surviving daughter of a Veteran who served on active duty from December 1957 to December 1961. The Veteran died in March 2009. This matter is before the Board of Veterans' Appeals (Board) on appeal from an October 2009 administrative decision of the Philadelphia, Pennsylvania Department of Veterans Affairs (VA) Regional Office (RO). In November 2011, a videoconference hearing was held before the undersigned. A transcript of the hearing is associated with the claims file. The Board directs the RO to arrange for an audit of the payments previously reimbursed in this case, and send a summary of the findings to the appellant. The Board notes that it has reviewed both the physical claims file and Virtual VA to ensure that the complete record is considered. FINDINGS OF FACT 1. A February 2009 rating decision awarded the Veteran was the following VA benefits: service connection for loss of use of the upper extremities due to amyotrophic lateral sclerosis (ALS), rated 100 percent, effective September 23, 2008; service connection for loss of use of the lower extremities due to ALS, rated 100 percent, effective September 23, 2008; service connection for aphonia due to ALS, rated 100 percent, effective September 23, 2008; service connection for dysphagia due to ALS, rated 50 percent, effective September 23, 2008; and special monthly compensation based on loss of use of the upper and lower extremities, from September 23, 2008; he was also awarded basic eligibility to Dependents' Educational Assistance, from September 23, 2008, and entitlement to financial assistance for the purchase of an automobile and adaptive equipment and specially adapted housing. 2. The Veteran died on March [redacted], 2009. 3. On March [redacted], 2009, one day after the Veteran's death, VA issued a retroactive award payment check for his VA benefits totaling $32,617.00; the Veteran did not receive the retroactive payment award check for VA benefits issued on March [redacted], 2009 (as it was issued after his death); the check was not negotiated, and was reclaimed by the United States Treasury. 4. The appellant is not the Veteran's spouse, child (as defined by VA regulation), or dependent parent; she did not make any payments for the Veteran's terminal illness expenses; she has been reimbursed for her payment of the Veteran's burial expenses. CONCLUSION OF LAW The criteria for establishing legal entitlement to all, or any portion of, the Veteran's non-negotiated payment for VA benefits (in the amount of $32,617.00), for purposes of accrued benefits, are not met. 38 U.S.C.A. §§ 101(4), 5121, 5122 (West 2002); 38 C.F.R. §§ 3.57(a), 3.1000, 3.1003 (2013). REASONS AND BASES FOR FINDINGS AND CONCLUSION Veterans Claims Assistance Act of 2000 (VCAA) The VCAA, in part, describes VA's duties to notify and assist claimants in substantiating a claim for VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126; 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326(a). The VCAA need not be considered because the issue presented is solely one of statutory interpretation (and the claim by this claimant is barred as a matter of law). See Smith v. Gober, 14 Vet. App. 227, 231-232 (2000), aff'd, 281 F.3d 1384 (Fed. Cir. 2002), cert. denied, 537 U.S. 821 (2002). See also 38 C.F.R. § 3.159(b)(3)(ii) (VCAA notice not required when, as a matter of law, entitlement to the benefit claimed cannot be established); 38 C.F.R. § 3.159(d)(3) (VA will refrain from or discontinue assistance with regard to a claim requesting a benefit to which the claimant is not entitled as a matter of law). The Board notes that at the hearing before the undersigned it was explained to the appellant that the matter at hand would be decided on the basis of statutory interpretation (which would be researched thoroughly before a decision was rendered). Legal Criteria Benefits to which a beneficiary was entitled at his death, based on evidence on file at the date of death or under existing ratings or decisions, i.e., accrued benefits, will be paid to survivors as provided by law. 38 U.S.C.A. § 5121(a); 38 C.F.R. § 3.1000(a). The entitlement of the accrued benefits claimant is derived from the Veteran's entitlement, and the accrued benefits claimant cannot be entitled to a greater benefit than the Veteran would have received had he lived. Zevalkink v. Brown, 6 Vet. App. 483, 489-90 (1994). Upon the death of a Veteran beneficiary, accrued benefits are paid to the first living person in a list as follows: the Veteran's spouse, the Veteran's children (in equal shares), or the Veteran's dependent parents (in equal shares). 38 U.S.C.A. § 5121(a)(2); 38 C.F.R. § 3.1000(a)(1). In all other cases, accrued benefits may be paid only as necessary to reimburse the person who bore the expense of last sickness and burial. 38 U.S.C.A. § 5121(a)(6); 38 C.F.R. § 3.1000(a)(5). The term "child" for purposes of Title 38 of the United States Code is specifically defined. For purposes of determining eligibility as a claimant under Title 38, a child must be unmarried and must be either under the age of 18, have become permanently incapable of self-support before the age of 18, or be between the ages of 18 and 23 and pursuing a course of instruction at an approved educational institution. 38 U.S.C.A. § 101(4)(A); 38 C.F.R. §§ 3.57(a)(1), 3.315(a), 3.356. The effective date of discontinuance of compensation, dependency and indemnity compensation, or pension by reason of the death of the payee is the last day of the month before death occurred. 38 U.S.C.A. § 5112(b)(1); 38 C.F.R. § 3.500(g). Accrued benefit payments that were not negotiated by a payee prior to his or her death are discussed within 38 U.S.C.A. § 5122 and 38 C.F.R. § 3.1003. The statute (38 U.S.C.A. § 5122) provides that a check received by a payee in payment of accrued benefits shall, if the payee died on or after the last day of the period covered by the check, be returned to the issuing office and canceled, unless negotiated by the payee or the duly appointed representative of the payee's estate. The amount represented by such check, or any amount recovered by reason of improper negotiation of any such check, shall be payable in the manner provided in section 5121 of this title, without regard to section 5121(c) of this title (that is, there is no one-year time limit for filing the claim for accrued benefits if section 5122 applies). Any amount not paid in the manner provided in section 5121 of this title shall be paid to the estate of the deceased payee unless the estate will escheat. 38 U.S.C.A. § 5122. The accompanying regulation (38 C.F.R. § 3.1003) pertaining to section 5122 clarifies that where the payee of a check for benefits has died prior to negotiating the check, the check shall be returned and canceled. 38 C.F.R. § 3.1003. The amount represented by the returned check, less any payment for the month in which the payee died, shall be payable to the living person or persons in the order of precedence set forth for accrued benefits. 38 C.F.R. § 3.1003(a). Payments to persons who bore the payee's last expenses are limited to the amount necessary to reimburse those expenses. Id. There is no limit on the retroactive period for which payment of the amount represented by the check may be made, and no one-year time limit for filing a claim to obtain the proceeds of the check or for furnishing evidence to perfect a claim. 38 C.F.R. § 3.1003(a)(1). Any amount not paid in this manner shall be paid to the estate of the deceased payee, provided that the estate will not revert to the state because there is no one eligible to inherit it. 38 C.F.R. § 3.1003(b). The VA Adjudication Procedure Manual (M21-1MR) provides further instructive guidance. It states that payments made to the beneficiary but not negotiated prior to his/her death are not technically accrued benefits but are considered non-negotiated benefits. These benefits are payable in the same manner as accrued benefits, but they are not subject to any restriction on either the retroactive period which may be covered by the amount payable or to the other time limits contained in that section of the law. Payment may also be made as reimbursement for last illness and burial expenses if there is no one within a permitted class. If payment cannot be made on the basis of relationship or reimbursement, it will be made to the deceased beneficiary's estate, unless the funds will revert to the State. The M21-1MR adds that 38 U.S.C.A. § 5122 and 38 C.F.R. § 3.1003 provide for the disposition of funds represented by checks, the whole proceeds of which are for a period not extending beyond the effective date of termination for death, which were received but not negotiated by the payee and which were returned and canceled. However, these policies do not apply to any check delivered after the payee's death or representing payment for a period extending beyond the date of termination due to death. See M21-1MR, Part VIII, Chapter 4, Topic 4, Blocks a, b, c. The Court has interpreted the requirement that the check be "received" by a payee, for purposes of applying 38 U.S.C.A. § 5122, as requiring actual receipt by the payee during the payee's lifetime, that is, that the benefit payment be at least delivered to or under the control of the payee prior to the payee's death, even if not negotiated, signed, or used by the payee during his or her lifetime. See Wilkes v. Principi, 16 Vet. App. 237, 242-243 (2002) (electronic transfer to deceased payee's account six days after payee's death did not constitute "receipt" by the payee for purposes of 38 U.S.C.A. § 5122). In essence, if the payment at issue was made to the payee after his or her death, the provisions of 38 U.S.C.A. § 5122 and 38 C.F.R. § 3.1003 are inapplicable; rather, the provisions of 38 U.S.C.A. § 5121 and 38 C.F.R. § 3.1000 govern as to an accrued benefits claim. Id. Factual Background and Analysis The Board notes that it has reviewed all of the evidence in the claims file, with an emphasis on the evidence relevant to this appeal. Although the Board has an obligation to provide reasons and bases supporting its decision, there is no need to discuss, in detail, every piece of evidence of record. Gonzales v. West, 218 F.3d 1378, 1380-81 (Fed. Cir. 2000). Hence, the Board will summarize the relevant evidence as appropriate, and the Board's analysis will focus specifically on what the evidence shows, or fails to show, as to the claim being decided. A February 2009 rating decision awarded the Veteran the following VA benefits: service connection for loss of use of the upper extremities due to amyotrophic lateral sclerosis (ALS), rated 100 percent, effective September 23, 2008; service connection for loss of use of the lower extremities due to ALS, rated 100 percent, effective September 23, 2008; service connection for aphonia due to ALS, rated 100 percent, effective September 23, 2008; service connection for dysphagia due to ALS, rated 50 percent, effective September 23, 2008; and special monthly compensation based on loss of use of the upper and lower extremities, from September 23, 2008; he was also awarded basic eligibility to Dependents' Educational Assistance, from September 23, 2008 and entitlement to financial assistance for the purchase of an automobile and adaptive equipment and specially adapted housing. The Veteran died on March [redacted], 2009. One day later, on March [redacted], 2009, VA issued a retroactive payment check for VA benefits totaling $32,617.00. As this check was issued after he died, he did not receive it. The check remained non-negotiated and was reclaimed by the United States Treasury. First, the Board will address entitlement to accrued benefits under 38 U.S.C.A. § 5122 and 38 C.F.R. § 3.1003. Because the Veteran never received the award check for his service-related benefits (as it was issued after his death), the Board has determined that neither the appellant nor the estate of the Veteran is entitled to any portion of the non-negotiated $32,617.00 under 38 U.S.C.A. § 5122 and 38 C.F.R. § 3.1003 (as this law and regulation do not apply when a payee does not receive the payment in question). Next, the Board will address entitlement to accrued benefits under 38 U.S.C.A. § 5121 and 38 C.F.R. § 3.1000 for a "child" of the Veteran as defined by VA regulation. The evidence of record reflects that the Veteran did not have a spouse or dependent parents at the time of his death. The appellant filed a claim for accrued benefits in May 2009; while the appellant is the Veteran's biological daughter, she does not qualify as a "child" as defined by VA regulation because she is not unmarried and under the age of 18, did not become permanently incapable of self-support before the age of 18, and is not between the ages of 18 and 23 and pursuing a course of instruction at an approved educational institution. Because the appellant does not qualify as a "child" of the Veteran as defined by VA regulation, the Board has determined that the appellant is not entitled to any portion of the non-negotiated $32,617.00 under 38 U.S.C.A. § 5121(a)(2) and 38 C.F.R. § 3.1000(a)(1). Finally, the Board will address entitlement to accrued benefits under 38 U.S.C.A. § 5121 and 38 C.F.R. § 3.1000 for someone who is not the spouse, "child" (as defined by VA regulation), or dependent parent of the Veteran. The evidence of record reflects that the Veteran received in-home health care during the last months of his life. Invoices for this treatment listed the Veteran himself as the payee for such care. At the November 2011 hearing, the appellant affirmed that the Veteran paid these "last sickness" care expenses himself. She testified that such care amounted to $47,272.79. Furthermore, the evidence of record reflects that the appellant paid the Veteran's burial expenses (totaling $1,553.25). An August 2009 rating decision granted a burial allowance in the amount of $1,553.25 to reimburse the appellant for the burial expenses. Because the appellant did not make any payments for the Veteran's last sickness expenses, and has already been reimbursed for her payment of the Veteran's burial expenses, the Board has determined that she is not entitled to any portion of the non-negotiated $32,617.00 under 38 U.S.C.A. § 5121(a)(5) and 38 C.F.R. § 3.1000(a)(5). [The estate of a deceased Veteran does not fall within the class of individuals eligible to receive accrued benefits under 38 U.S.C.A. § 5121 and 38 C.F.R. § 3.1000.] As an additional matter, the Board notes that the appellant has contended that the Veteran's estate should be reimbursed the $47,272.79 which was paid by the Veteran for his in-home health care during the last months of his life. However, the Board notes that the Veteran never filed a claim during his lifetime for reimbursement of these unauthorized medical expenses. Therefore, his estate is not entitled to reimbursement of such expenses, either automatically or otherwise. Furthermore, because no action was ever taken to determine whether VA owed the Veteran this $47,272.79 during his lifetime, such an amount cannot constitute a portion of an accrued benefits claim, as accrued benefits are defined by law as benefits to which a beneficiary was entitled at his death, based on evidence on file at the date of death or under existing ratings or decisions. 38 U.S.C.A. § 5121(a); 38 C.F.R. § 3.1000(a). As neither the appellant nor the estate of the Veteran has any legal entitlement to any portion of the Veteran's non-negotiated service-related benefits ($32,617.00), for purposes of accrued benefits, the law is dispositive, and legal entitlement to such payment must be denied. ORDER The appeal seeking legal entitlement to all, or any portion of, the Veteran's non-negotiated payment for retroactive VA benefits for purposes of accrued benefits (in the amount totaling $32,617.00) is denied. ____________________________________________ GEORGE R. SENYK Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs