Citation Nr: 1316594 Decision Date: 05/21/13 Archive Date: 05/29/13 DOCKET NO. 12-12 220 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Houston, Texas THE ISSUES 1. Entitlement to restoration of 38 U.S.C.A. § 1151 compensation for hepatitis C with rheumatological autoimmune disease. 2. Entitlement to restoration of compensation for depressive disorder, not otherwise specified. 3. Entitlement to restoration of special monthly compensation. 4. Entitlement to restoration of Chapter 35 Dependents' Educational Assistance. REPRESENTATION Veteran represented by: Jerry N. Whiteker, Attorney at Law WITNESS AT HEARING ON APPEAL The Veteran ATTORNEY FOR THE BOARD P. Childers, Counsel INTRODUCTION Please note 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 Veteran served on active duty from October 1969 to September 1971. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a June 2011 rating decision of a Department of Veterans Affairs (VA) Regional Office (RO). In September 2012 the Veteran testified before the undersigned Veterans Law Judge at a Travel Board hearing in Houston, Texas. A transcript of that hearing is in the claims file. FINDINGS OF FACT 1. In a rating decision in September 2006, the RO granted Section 1151 compensation for hepatitis C with rheumatological autoimmune disease, effective March 15, 2001. 2. In a rating decision in May 2008 the RO increased the Section 1151 compensation award to 100 percent and granted derivative benefits of special monthly compensation and Dependents' Educational Assistance; and compensation for depressive disorder, not otherwise specified, secondary to the Veteran's hepatitis C disability. 3. In a rating decision in August 2010, the RO proposed to sever the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease; and, in turn, compensation for depressive disorder secondary to the Veteran's hepatitis C disability, entitlement to special monthly compensation, and entitlement to Dependents' Educational Assistance. 4. In a rating decision in June 2011, the RO severed the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease and the respective grants of compensation for depressive disorder secondary to hepatitis C; entitlement to special monthly compensation; and entitlement to Dependents' Educational Assistance; all effective September 1, 2011. 5. The award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease had been in effect for more than 10 years on September 1, 2011; and there is no evidence that the original grant was based on fraud, or that the Veteran does not have requisite military service and character of discharge. CONCLUSION OF LAW The criteria for restoration of the severed award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease, and the respectively severed awards of compensation for depressive disorder (not otherwise specified) secondary to hepatitis C with rheumatological autoimmune disease, entitlement to special monthly compensation, and entitlement to Dependents' Educational Assistance, are met effective September 1, 2011. 38 U.S.C.A. §§ 1110, 1159 (West 2002 & Supp. 2012); 38 C.F.R. §§ 3.105(d), 3.957 (2012). REASONS AND BASES FOR FINDINGS AND CONCLUSION In this decision, the Board is restoring all of the benefits sought on appeal; namely, Section 1151 compensation for hepatitis C with rheumatological autoimmune disease, compensation for depressive disorder not otherwise specified (secondary to hepatitis C with rheumatological autoimmune disease), entitlement to special monthly compensation, and entitlement to Dependents' Educational Assistance. As this represents a complete grant of the benefits sought on appeal, no discussion of VA's duty to notify and assist is necessary. Facts DD Form-214 confirms that the Veteran was Honorably discharged after active duty service in the U.S. Army from October 1969 to September 1971. On August 31, 1983, the Veteran underwent a cholescystectomy and intraoperative cholangiogram at the Houston VAMC. VA medical records dating from July 1998 reflect a diagnosis of hepatitis C. A VA treatment record dated February 1, 1999, notes that the Veteran was being followed for hepatitis C, and that the Veteran had "physiologic depression - most likely from hepatitis C." A VA medical record (gastrointestinal consult note) dated November 10, 1999, relates that the Veteran had been diagnosed with hepatitis C three years previously, and that the Veteran had had a blood transfusion in 1983. In an opinion dated in May 2006, a VA Compensation and Pension examiner averred that in view of the negative history of intravenous drug abuse and the possibility of blood transfusion in 1983 it was at least as likely as not that the Veteran acquired hepatitis C through the blood transfusion. In a rating decision in September 2006, the RO granted Section 1151 compensation for hepatitis C with an evaluation of 40 percent effective March 15, 2001. On VA examination in April 2008, the axis I diagnosis was depressive disorder not otherwise specified and the axis III diagnosis was hepatitis C, cirrhosis of the liver. The examiner added that the Veteran's depressive disorder was most likely caused by or a result of the Veteran's chronic medical problems. In a rating decision dated in May 2008 the RO increased the rating for the Veteran's hepatitis C disability to 100 percent, and granted compensation for depressive disorder not otherwise specified with a rating of 30 percent, on the grounds that the psychiatric disorder was related to the Veteran's hepatitis C disability. The RO also granted entitlement to special monthly compensation and Dependents' Educational Assistance in that decision. In a rating decision dated in August 2010, the RO proposed to sever the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease (and in turn the related grants of compensation for depressive disorder secondary to hepatitis C; entitlement to special monthly compensation; and entitlement to Dependents' Educational Assistance) based on "conclusive evidence that [the Veteran] never received a blood transfusion during the routine cholecystectomy procedure." In a rating decision dated in June 21, 2011, the RO severed the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease; compensation for depressive disorder secondary to hepatitis C; entitlement to special monthly compensation; and entitlement to Dependents' Educational Assistance; all effective September 1, 2011. Law and Analysis Under VA law and regulations, service connection for any disability that has been in effect for 10 or more years will not be severed except upon a showing that the original grant was based on fraud or that military records show a lack of the required service or character of discharge (38 U.S.C.A. § 1159; 38 C.F.R. § 3.957). The 10 year period is computed from the effective date of the finding of service connection to the effective date severing service connection. The Court of Appeals for Veterans' Claims (Court) held that this same protection from severance applies to awards of Section 1151 compensation. Hornick v. Shinseki, 24 Vet. App. 50, 56 (2010) (holding that the Section 1159 protection from severance of awards of "service connection" in effect for 10 or more years also extends to awards of compensation under Section 1151 that have been in effect for 10 or more years). In this case the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease had been in effect for more than 10 years on September 1, 2011, the date of severance, so, absent a finding of fraud by the Veteran or a lack of honorable service, the award of Section 1151 compensation may not be severed. 38 C.F.R. § 3.957. In this case the RO does not allege, and the evidence does not show, that the grant of Section 1151 compensation was based on fraud by the Veteran or that he lacked proper military service. Rather, the severance was based on a later conclusion that the grant was in error. This is not one of the grounds for severance for an award in effect 10 years pursuant to 38 C.F.R. § 3.957, which is controlling in this matter. Therefore, and in accordance with Hornick, supra, the Board finds that the award of Section 1151 compensation in effect from March 15, 2001, until September 1, 2011, is protected and may not be severed. 38 U.S.C.A. § 1159; 38 C.F.R. § 3.957. As the award of Section 1151 compensation for hepatitis C with rheumatological autoimmune disease is restored, the respective grants of special monthly compensation, Dependents' Educational Assistance, and compensation for depressive disorder secondary to hepatitis C with rheumatological autoimmune disease, which were severed for no reason other than the ill-advised severance of Section 1151 compensation, are in turn restored. ORDER The appeal for restoration of §1151 compensation for hepatitis C with rheumatological autoimmune disease is granted, effective September 1, 2011. The appeal for restoration of compensation for depressive disorder not otherwise specified is granted, effective September 1, 2011. The appeal for restoration of special monthly compensation is granted, effective September 1, 2011. The appeal for restoration of Chapter 35 Dependents' Educational Assistance is granted, effective September 1, 2011. ____________________________________________ MICHAEL E. KILCOYNE Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs