Citation Nr: 1419087 Decision Date: 04/30/14 Archive Date: 05/06/14 DOCKET NO. 11-12 039 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Reno, Nevada THE ISSUE Entitlement to an additional apportionment of $34.00 from January 27, 2005 to March 1, 2005 on behalf of minor child, A.S.H. REPRESENTATION Appellant represented by: Virginia Department of Veterans Services ATTORNEY FOR THE BOARD S.M. Kreitlow INTRODUCTION The Veteran had active military service from April 1989 to December 2003. The appellant is the custodian of the Veteran's dependent child, A.S.H. This matter comes before the Board of Veterans' Appeals (Board) on appeal from decisions of the Department of Veterans Affairs (VA) Regional Office (RO) in Reno, Nevada. FINDINGS OF FACT 1. The Veteran's dependent child, A.S.H., resides with the appellant, her mother. 2. As of February 2010, the Veteran was obligated to pay child support for his dependent child in the monthly amount of $562.50, which obligation he had not met and had an arrearage due of $28,170.00. 3. On January 27, 2005, the RO received the appellant's initial request for apportionment of the Veteran's benefits on behalf of his dependent child, A.H.S., at which time the Veteran was receiving compensation for service-connected disabilities at a combined rating of 80 percent with a total disability rating due to individual unemployability (TDIU) and including additional compensation for his child, A.S.H. The claim was denied in an August 2005 Special Apportionment Decision on the basis the both the Veteran and the appellant failed to submit income and expense information requested. 4. In February 2010, the appellant filed a second claim for an apportionment for the Veteran's dependent child, A.H.S. 5. By Special Apportionment Decision in September 2010, an apportionment in the amount of $100.00 was awarded on behalf of A.S.H. effective March 1, 2010. The appellant disagreed with the effective date of that award. 4. In a July 2011 Special Apportionment Decision, the RO found that the August 2005 denial of apportion was clearly and unmistakably erroneous in that the appellant had submitted the requested income and expenses information and awarded an apportionment in the amount of $66.00 (the amount of the dependency award) effective January 27, 2005, the date of the appellant's original claim. The appellant has continued to disagree with the amount of the apportionment, requesting payment of the additional $34.00 a month to equal the $100.00 awarded in the September 2010 decision. 5. The effective date of the basic apportionment award of $100.00 should be January 27, 2005. CONCLUSION OF LAW An additional apportionment of the Veteran's monthly compensation in the amount of $34.00 from January 27, 2005 until March 1, 2010 is warranted. 38 U.S.C.A. §§ 5107, 5307 (West 2002 & Supp. 2013); 38 C.F.R. §§ 3.102, 3.450, 3.451 (2013). REASONS AND BASES FOR FINDINGS AND CONCLUSION A veteran's benefits may be apportioned if the veteran is not residing with his or her spouse or his or her children and a claim for apportionment is filed for or on behalf of the spouse or children. 38 C.F.R. § 3.452(a). VA regulations provide for two types of apportionments. The first type is a "general" apportionment, which may be paid under the circumstances set forth in 38 C.F.R. § 3.450. More specifically, all or any part of the compensation payable on account of any veteran may be apportioned if the veteran is not residing with his spouse or children, and the veteran is not reasonably discharging his responsibility for the spouse's or child's support. 38 U.S.C.A. § 5307(a)(2); 38 C.F.R. § 3.450(a)(1)(ii). It is not necessary for the claimant to establish the existence of hardship in order to obtain an apportionment under 38 C.F.R. § 3.450. See Hall v. Brown, 5 Vet. App. 294 (1993). The second type is a "special" apportionment. Under this type of apportionment, without regard to any other provision regarding apportionment, where hardship is shown to exist, compensation may be apportioned between the veteran and his dependents on the basis of the facts of the individual case as long as it does not cause undue hardship to the other persons in interest. In determining the basis for special apportionment, consideration is to be given to such factors as the amount of VA benefits payable, other income and resources of the veteran and those dependents in whose behalf the apportionment is claimed, and the special needs of the veteran, his dependents and the apportionment claimants. Apportionment of more than 50 percent of the veteran's benefits is ordinarily considered to constitute undue hardship on him or her; but apportionment of less than 20 percent of his or her benefits is ordinarily considered insufficient to constitute a reasonable basis for any apportionee. 38 C.F.R. § 3.451. The special apportionment was apparently designed to provide for an apportionment in situations where a veteran is reasonably discharging his responsibility for the support of any claimant who might be entitled to a "general" apportionment, but special circumstances exist which warrant giving "dependents" additional support. See, e. g., Vet. Reg. No. 6(c), Instruction No. 2, VI (Oct. 1934); cf. Vet. Reg. No. 6(c), 4 (June 1934). Both of these types of apportionments (either "general" or "special" apportionment) are payable to a spouse or dependent. 38 U.S.C.A. § 5307(a)(2); 38 C.F.R. §§ 3.450(a)(1)(ii), 3.451. The effective date of an apportionment based on a dependent's original claim is established in accordance with the facts found; otherwise, it is the first day of the month following the month in which the claim for apportionment is received unless otherwise provided. 38 C.F.R. § 3.400(e). In the present case, the mother of the Veteran's dependent child (appellant) originally submitted a claim for apportionment of the Veteran's benefits on January 27, 2005, on behalf of their child, A.S.H. A.S.H. was born on May [redacted], 1996. Thus, at the time the application was filed, and at all time since, A.S.H. has been a minor. Paternity is not contested. The minor child is currently in the custody of the appellant. By letters dated in May 2005, the appellant and Veteran were advised of what information was required for VA to consider the request for apportionment of the Veteran's VA benefits on behalf of A.H.S. The appellant responded on a VA Form 21-4138 received by the RO in July 2005. Nevertheless, the claim for apportionment was denied in August 2005 on the basis that neither the Veteran nor the appellant has submitted the requested information. In February 2010, the appellant submitted a VA Form 21-0788, Information Regarding Apportionment of Beneficiary's Award and a printout from the Maryland Child Support Enforcement Program, Department of Human Resources, showing the Veteran's child support monthly obligation and arrearages due. In May 2010, the appellant was informed that her claim was denied because she failed to respond to an April 2010 letter advising her that the original claim paperwork could not be found and asking her to submit it. In June 2010, the appellant resubmitted her claim for an apportionment on a VA Form 21-4138. By Special Apportionment Decision issued in September 2010, the RO granted an apportionment of the Veteran's benefits on behalf of his dependent child, A.S.H. in the amount of $100.00 effective March 1, 2010 (the first day of the month after the most recent claim was received). In rendering the decision, the RO noted that the Veteran had not responded to its request for information but it could proceed on the evidence of record, which showed that he was not contributing to the support of his child, A.S.H., that he was rated 80 percent and that he is in receipt of compensation for A.S.H. as his dependent on his award. Thus, the RO granted the apportionment based on the lack of support the Veteran provides for A.S.H. and that the apportionment will not cause him undue hardship. Thereafter, the appellant disagreed with the date in which the apportionment went into effect, arguing that she initially filed her claim in January 2005 and did send in the information requested. In a Special Apportionment Decision issued in July 2011, the RO found that there was clear and unmistakable error in the August 2005 decision originally denying an apportionment because the appellant had submitted the requested evidence. It, therefore, granted an apportionment effective January 27, 2005; however, it only granted $66.00, the amount of the dependency allowance at that time. The RO stated that, based on the evidence in the file at the time that the clear and unmistakable error was made, it has been determined that, although the appellant stated that she has $270.00 per month after her basic expenses are met, an apportionment for at least $66.00 per month should have been granted. This amount is based on the fact that the Veteran provided no support for his estranged dependent child and the additional amount received for that child at the time the apportionment request was made is $66.00 per month. In October 2011, the appellant advised the RO that she was not fully satisfied with this partial grant as she believes she should receive the full $100.00 per month originally awarded back to January 2005. In a July 2013 Supplemental Statement of the Case, the RO denied entitlement to the additional $34.00 a month from January 2005 to March 2010 because there is no evidence of undue hardship at the time of the claim and no evidence of additional error in the evidence considered. If it is decided that an apportionment should be made, the amount should be determined from an equitable assessment of any hardship or demonstrated need on the part of the primary beneficiary and the claimant. Factors to be considered include the amount of VA benefits available, other resources and income of the primary beneficiary and the claimant, and special needs of the primary beneficiary and the claimant. When the primary beneficiary is receiving additional benefits for dependents and the evidence shows he/she is not reasonably contributing to their support, hardship for the primary beneficiary would not normally result from apportionment of the additional amount payable for such dependents. VA Adjudication Procedure Manual, M21-1 Manual Rewrite, Part III, Subpart v, 3.A.3.a. In the present case, the Board finds that the RO has failed to provide a reasonable explanation as to why the $100.00 apportionment awarded effective March 1, 2010 should not be taken back to January 27, 2005, the date of the appellant's original claim for apportionment, rather than just $66.00, except to say that the $66.00 was the least amount that should be paid since that was the dependency amount paid to the Veteran for A.S.H at the time of her original claim. The dependency allowance that was effective in January 2005 when the appellant first filed for apportionment did not, however, stay at $66.00 over the next five years but was increased each year in December. The RO, however, only granted $66.00 for each year from January 27, 2005 to March 1, 2010. It did not adjust each year for the amount of the dependency allowance paid to the Veteran. (See the February 2012 notice to the Veteran effectuating the retroactive apportionment award.) Moreover, the $100.00 apportionment granted effective March 1, 2010 was a basic apportionment under 38 C.F.R. § 3.450, not a special apportionment under § 3.451. The dependency allowance in effect on March 1, 2010 was $75.00. Thus the apportionment granted effective March 1, 2010 was not solely based upon the dependency allowance. Rather the September 2010 decision awarding the $100.00 apportionment clearly shows that the Veteran's failure to meet his child support obligations, the lack of a hardship on the Veteran, and the appellant's need based upon her income and expenses reported were considered. The evidence shows that in July 2005, the appellant reported that she had only $270.00 of residual monthly income. In the September 2010 decision, however, it was calculated that she had residual income of $1,205.00 based upon the income and expenses she reported on her February 2010 VA Form 21-0788. Following the RO's reasoning in the September 2010 decision, therefore, it does not make sense that the $100.00 apportionment allowance was not taken back to January 27, 2005, because clearly the appellant's need for an apportionment in January 2005 (when she only had residual monthly income of $207.00) was greater than in February 2005 (when she had residual income of $1,205.00). Furthermore, the Board finds that the finding in the July 2013 Supplemental Statement of the Case that the appellant did not establish a hardship in 2005 and, therefore, is not entitled to the additional apportionment amount of $34.00 is flawed. The awards of apportionment in September 2010 and July 2011 were for basic apportionment under 38 C.F.R. § 3.450, not a special apportionment under 38 C.F.R. § 3.451. The need for an appellant to show hardship (beyond that the Veteran was not meeting his child support obligations) is only required for a special apportionment under § 3.451. Furthermore, the rationale shows an error in the way that the issue was characterized and thought of by the RO adjudicator. Although stated as entitlement to an additional apportionment of $34.00, the issue really is entitlement to an earlier effective date of the $100.00 apportionment awarded effective March 1, 2010. Even though a partial grant of $66.00 was given, the appellant is seeking the additional $34.00 of the original $100.00 awarded, which was given under the provisions for a basic apportionment. Consequently, the issue remains one of an earlier effective date of the full $100.00 basic apportionment award and the appellant is not required to show a hardship in order to be entitled to the additional apportionment amount of $34.00 per month. Finally, in a February 2011 statement, the Veteran agreed that he was willing to have $110.00 of his VA compensation apportioned to his daughter, A.S.H. Furthermore, the Board notes that s substantial portion of the $100.00 apportioned is the dependency allowance paid to the Veteran on behalf of his daughter (which ranged from $66.00 in 2005 to $75.00 in 2010). Thus, clearly there is no hardship on the Veteran in awarding an apportionment of $100.00 for the period of January 27, 2005 to March 1, 2010. Consequently, the Board finds that the reasoning for only granting the $66.00 apportionment allowance from January 27, 2005 to March 1, 2010 based solely upon the dependency allowance paid to the Veteran is flawed. Instead, the Board finds that the evidence establishes that the appellant was entitled to a basic apportionment effective January 27, 2005 and that the apportionment amount should have been $100.00. Hence, the Board finds that the appellant is entitled to the additional apportionment amount of $34.00 per month from January 27, 2005 until March 1, 2010. ORDER Entitlement to an additional apportionment of $34.00 from January 27, 2005 to March 1, 2005 on behalf of minor child, A.S.H, is granted. ____________________________________________ ROBERT E. SULLIVAN Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs