Citation Nr: 20003866 Decision Date: 01/16/20 Archive Date: 01/15/20 DOCKET NO. 14-29 778 DATE: January 16, 2020 ORDER The overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing, and $300.00 for books and supplies, was properly created. REMANDED Entitlement to waiver of recovery of the overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing, and $300.00 for books and supplies, is remanded. FINDINGS OF FACT 1. The Veteran received Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing allowance, and $300.00 for books and supplies, to which he is not legally entitled. 2. The creation of the overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing allowance, and $300.00 for books and supplies, was not due to sole VA error. CONCLUSION OF LAW The overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing, and $300.00 for books and supplies, was properly created. 38 U.S.C. §§ 5112, 5302, 5314; 38 C.F.R. §§ 1.911, 1.956, 1.962, 3.500, 21.4022, 21.9635, 21.9695. REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty in the United States Air Force June 1992 to October 2002. This matter comes to the Board of Veterans' Appeals (Board) on appeal from a March 2014 determination by a Department of Veterans Affairs (VA) Regional Office (RO) which, in pertinent part, denied a waiver of recovery of the overpayment in this case. The statement of the case (SOC) also included the issue of the validity of the overpayment; the Veteran indicated in his substantive appeal that he wanted to appeal all issues listed in the SOC; and the certification of appeal listed both validity and waiver issues. Accordingly, both issues are before the Board for appellate consideration. The Veteran’s representative asserted in an April 2019 written submission that the appellate issues also included the inextricably intertwined issue of entitlement to education benefits under Chapter 33 (Post-9/11 GI Bill) in excess of the 60 percent level. See Harris v. Derwinski, 1 Vet. App. 180, 183 (1991) (two or more issues are inextricably intertwined if one claim could have significant impact on the other). However, the record does not reflect the Veteran has initiated or perfected an appeal with respect to that issue. Moreover, the creation of the overpayment in this case, as detailed below, was not based upon the percentage level of his Chapter 33 benefits; nor does it appear to be one of the factors that is generally considered in determining whether a waiver is warranted. See 38 C.F.R. § 1.965. In fact, if he had been in receipt of a higher percentage level in this case, the amount of the overpayment would have been higher. The Board concludes that this issue is not properly before it for appellate review; nor is it inextricably intertwined with the issues otherwise properly developed for appeal. In his July 2014 substantive appeal, the Veteran indicated that he wanted to appear at a Board hearing at the RO. Hearings were scheduled for November 2018 and July 2019, but the Veteran did not report. Although he indicated in a January 2019 statement that he missed the November 2019 hearing due to circumstances beyond his control, no good cause has been provided as to why he did not report for the July 2019 hearing. Consequently, his hearing request is deemed withdrawn. See 38 C.F.R. § 20.704. Whether the overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing allowance, and $300.00 for books and supplies, was properly created The Board notes that the Veteran's basic eligibility for Chapter 33 (Post-9/11 GI Bill) education benefits is not in dispute. Rather, the dispute is whether he received an overpayment of such benefits, and, if so, whether he is entitled to a waiver of such overpayment. An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits to which he or she is not entitled. See 38 U.S.C. § 5302; 38 C.F.R. § 1.962. An overpayment may arise from virtually any benefits program administered pursuant to VA law, including pension, compensation, dependency and indemnity compensation (DIC), educational assistance benefits and subsistence allowance, insurance benefits, burial and plot allowances, clothing allowance, and automobile or other conveyance and adaptive equipment allowances. 38 C.F.R. § 1.956(a). VA generally is required to recover erroneous VA payments or overpayments of benefits. See Edwards v. Peake, 22 Vet. App. 57, 59 (2008); 38 U.S.C. § 5314(a) (generally requiring VA to deduct from future benefit payments a debt arising from a person's participation in a VA benefits program); 38 C.F.R. § 1.912a(a) (same); 38 U.S.C. § 5316 (authorizing VA to recover a benefit(s) related debt by bringing a suit if the person fails to appropriately respond to reasonable administrative efforts to collect the debt). That is, whenever the Secretary finds that an overpayment has been made to a veteran or eligible person, the amount of such overpayment shall constitute a liability of such veteran or eligible person to the United States. 38 U.S.C. § 3685; Mountford v. Shinseki, 24 Vet. App. 443, 450, n.6 (2011). The preliminary issue of the validity of a debt is a threshold determination that must be made prior to a decision on a request for waiver of the indebtedness. See Schaper v. Derwinski, 1 Vet. App. 430, 437 (1991). In other words, before making a decision on a request for waiver, VA must first consider the validity of the debt. See also 38 U.S.C. § 5314(b) (prohibiting offset of a debt from future benefit payments unless VA first makes a determination with respect to the beneficiary's dispute as to the existence or amount of debt). 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); see also VAOPGCPREC 6-98. The propriety and amount of the overpayment at issue are matters that are integral to a waiver determination. See Schaper, 1 Vet. App. at 434. For a determination that an overpayment was not properly created, such that the debt is not valid, it must be established that the appellant was either legally entitled to the benefits in question or, if the appellant was not legally entitled, then it must be shown that VA was solely responsible for the appellant being erroneously paid benefits. Administrative errors include all administrative decisions of entitlement, whether based upon mistake of fact, misunderstanding of controlling regulations or instructions, or misapplication of law. VAOPGPREC 2-90 (July 17, 1989), 55 Fed. Reg. 27757 (1990). Sole administrative error connotes that the appellant neither had knowledge of nor should have been aware of the erroneous award. Further, neither the appellant's actions nor his or her failure to act must have contributed to payment pursuant to the erroneous award. 38 U.S.C. § 5112(b)(9), (10); 38 C.F.R. § 3.500(b)(2); Jordan v. Brown, 10 Vet. App. 171 (1997) (sole administrative error is not present if the payee knew, or should have known, that the payments were erroneous). Thus, a finding of sole administrative error requires not only error on the part of VA, but that the beneficiary is unaware that the payments are erroneous. Specific to VA educational assistance, an overpayment of educational assistance paid to an eligible individual under 38 U.S.C. Chapter 33 constitutes a liability of that individual, unless: (1) the overpayment was waived as provided in 38 C.F.R. §§ 1.957 and 1.962; or (2) the overpayment results from an administrative error or an error in judgment. 38 C.F.R. § 21.9695(b) (cross-referencing 38 C.F.R. § 21.9635 (r)). When an administrative error or error in judgment by VA is the sole cause of an erroneous award, the award will be reduced or terminated effective the date of last payment. 38 C.F.R. § 21.9635(r). If fault for an overpayment cannot "clearly be ascribed to the beneficiary," VA's policy is to assume that fault and not create a debt against the beneficiary. Dent v. McDonald, 27 Vet. App. 362, 380 (2015) (citing VAOPGCPREC 2-90 (March 1990)). However, when both VA and the beneficiary are partially at fault, the debt based on the effective date of reduction or discontinuance of benefits is properly created. See Jordan v. Brown, 10 Vet. App. 171, 174 (1997). The record reflects the overpayment in this case was created when the Veteran was awarded and accepted Chapter 31 (vocational rehabilitation) education benefits for an August 2013 to December 2013 program, and Chapter 33 (Post-9/11 GI Bill) education benefits for that period. The Board notes that the creation of the overpayment under these circumstances is consistent with the legal requirement that payment of education benefits under more than one VA educational program at the same time is not permitted. See 38 C.F.R. § 21.4022. As such, the record reflects the overpayment reflects benefits the Veteran was not legally entitled to keep, nor was it due to sole VA error. The Board notes the Veteran disputed the amount of the $300 overpayment for books and supplies, to include in his NOD, noting that he had received notification from VA that this amount had been reduced. A review of this notification reflects the reduction was due to a payment made by the Veteran, and the remaining overpayment was consistent with the amount of payment being subtracted from the $300. The Veteran also contended that the Chapter 31 (vocational rehabilitation) benefits did not cover his books and supplies. However, the legal prohibition against payment of education benefits under more than one VA education program at the same time is not based upon whether a claimant receives the same amount of benefits. The Veteran has not contended, nor does the record otherwise reflect, that there is error in the calculated amounts of overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits of $2,252.10 for housing allowance and $300.00 for books and supplies. The Veteran has also noted that he had to withdraw from his program due to surgical procedures on his neck and right arm. Although the Board is sympathetic to the impairment experienced by the Veteran as a result of these procedures, the record reflects they occurred in 2014 after the period and circumstances which gave rise to the overpayment in this case. He did contend that the circumstances of these procedures were among the factors which demonstrated that recovery of the overpayment would result in financial hardship. Such contentions, however, go to the issue of whether waiver of the overpayment is warranted, and not the validity of the creation of the overpayment. See 38 C.F.R. § 1.965. In light of the foregoing, the Board concludes the overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing allowance, and $300.00 for books and supplies, was properly created. Therefore, this aspect of the appeal must be denied. REASONS FOR REMAND Entitlement to waiver of recovery of the overpayment of Chapter 33 (Post-9/11 GI Bill) education benefits in the calculated amounts of $2,252.10 for housing allowance, and $300.00 for books and supplies is remanded. As noted above, the Veteran has contended that recovery of the overpayment in this case would result in financial hardship. In pertinent part, he submitted a Financial Status Report in February 2014 to the effect that his monthly expenses exceeded his monthly income by over $600. No updated financial information has since been obtained. At the time of the February 2014 Report, the Veteran stated that his only income was through VA. More recent evidence reflects that he subsequently completed his education program and obtained full-time employment. On the other hand, he also reported in January 2019 that he was dealing with complications and damages from a recent hurricane. A remand is required to obtain updated financial information. This matter is REMANDED for the following action: 1. Ask the Veteran to complete and submit updated Financial Status Report(s) covering the period from 2014 to the present. 2. After completing any additional development deemed necessary, readjudicate the matter of whether a waiver of overpayment is warranted in this case in accord with the principles of equity and good conscience. If any portion of benefit sought on appeal remains denied, the Veteran and his representative should be issued a supplemental statement of the case. An appropriate period of time should be allowed for response. DAVID A. BRENNINGMEYER Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board Department of Veterans Affairs The Board’s decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.