Citation Nr: 21062769 Decision Date: 10/12/21 Archive Date: 10/12/21 DOCKET NO. 14-17 953 DATE: October 12, 2021 ORDER Entitlement to waiver of recovery of an overpayment of VA non-service connected disability pension benefits in the amount of $7,946 plus accrued interest thereon is denied. FINDINGS OF FACT 1. The Veteran did not commit, fraud, misrepresentation, or bad faith in the creation of the debt. 2. Repayment of the $7,946 debt, would not deprive the Veteran of the basic necessities of life, would not result in financial hardship, and recovery of the overpayment would not defeat the purpose for which benefits were intended. 3. A waiver of the debt would result in unjust enrichment to the Veteran. CONCLUSION OF LAW The criteria for entitlement to waiver of recovery of an overpayment of VA non-service connected disability pension benefits in the amount of $7,946 plus accrued interest thereon have not been met. 38 U.S.C. § 5302; 38 C.F.R. §§ 1.911, 1.963(a), 1.965. REASONS AND BASES FOR FINDINGS AND CONCLUSION This matter comes before the Board of Veterans' Appeals (Board) from an October 2013 decision by the Department of Veterans Affairs (VA) Pension Management Center in Milwaukee, Wisconsin. The Veteran testified at a videoconference hearing in June 2015. A transcript of the hearing is associated with the claims file. In December 2015, the Board remanded the appeal to the RO for additional development. In May 2018 the Board found that an overpayment of VA nonservice-connected pension benefits in the amount of $7,946 plus accrued interest thereon was validly created. In May 2018 and September 2019, the Board remanded the issue of waiver entitlement to the RO for additional development. The appeal has been returned to the Board for further consideration. The Veteran was informed via a March 2021 letter that the Veterans Law Judge who had conducted the June 2015 videoconference hearing was no longer with the Board. The letter informed him that he could request a hearing with a new Veterans Law Judge who would then be able to decide his appeal. The Veteran did not reply to this letter, and the Board has proceeded with the adjudication of this appeal. Entitlement to waiver of recovery of an overpayment of VA non-service connected disability pension benefits in the amount of $7,946 plus accrued interest thereon As noted above, in a May 2018 decision the Board found that the overpayment debt in the amount of $7,946 was validly created. In October 2013, the Department of Veterans Affairs (VA) Committee on Waivers and Compromises (COWC) of the RO did not find fraud, misrepresentation, or bad faith in this case; however, the COWC determined it would be against the principles of equity and good conscience if the debt was not collected as the Veteran was at fault in the creation of the debt because he failed to notify VA of his income, there was unjust enrichment at government expense, and repayment of the debt would not defeat the purpose of the benefit. Thus, the request for a waiver of the recovery of the overpayment at issue was denied. The Veteran appealed that determination. Despite the validity of the overpayment debt, the Veteran may still receive a waiver for the debt created. 38 C.F.R. § 1.962. Recovery of overpayments of any benefits made under the laws administered by VA shall be waived if there is no indication of fraud, misrepresentation, or bad faith on the part of the person or persons having an interest in obtaining the waiver and if the recovery of the indebtedness from the payee who received such benefits would be against equity and good conscience. 38 U.S.C. § 5302; 38 C.F.R. §§ 1.962, 1.963(a), 1.965. The (COWC) did not find fraud, misrepresentation, or bad faith in this case. The Board agrees with this determination. The next question is whether the facts dictate that a waiver should be granted under the standard of "equity and good conscience." The phrase "equity and good conscience" means the arrival at a fair decision between the obligor and the Government. In making this determination, consideration will be given to the following elements (which are not intended to be all-inclusive): (1) fault of the debtor, (2) balancing of faults between the debtor and VA, (3) undue hardship of collection on the debtor, (4) defeat of the purpose of an existing benefit to the appellant, (5) unjust enrichment of the appellant, and (6) whether the appellant changed positions to his or her detriment in reliance upon a granted VA benefit. 38 U.S.C. § 5302; 38 C.F.R. § 1.965(a). After reviewing all the evidence of record, the Board finds that recovery of the debt would not violate principles of equity and good conscience. The first and second elements pertain to the fault of the debtor versus the fault of VA. The Board finds that the Veteran is at fault in the creation of the debt. In his February 2011 application for pension benefits, the Veteran reported his spouse's Social Security income but did not report any income for himself. In February 2011, VA informed the Veteran that he had not provided complete income information and asked the Veteran to complete VA Form 21-527. The Veteran did not respond. VA subsequently confirmed that the Veteran was in receipt of Social Security benefits in the amount of $1,642.50 per month. In an August 2011 Notification Letter, VA notified the Veteran that he was awarded special monthly pension based on the need for aid and attendance, and that he was being paid as a single veteran with no dependents. The Veteran was further informed that the income used to award his benefits was based solely on his Social Security income, less his reported medical expenses. In a December 2011 Notification Letter, the Veteran was informed that VA records showed his only income was from Social Security benefits, and that he must inform VA if he began receiving other income. In a January 2013 Notification Letter, the Veteran was notified of the requirement that he inform VA of all sources of income, to include retirement income. In August 2013, the Veteran reported Social Security income of $1,729.90 and $434.90 per month for himself and his spouse, respectively, as well as pension income of $616.66 per month. As such, the record shows that although the Veteran notified VA of his spouse's Social Security income in his February 2011 application for benefits, he did not provide complete income information for his household and did not respond to VA efforts to gather this information. Although he was notified in August 2011 that VA based his award only on his Social Security income and was informed of the requirement to report all sources of income, the Veteran did not provide complete income information until August 2013. As such, the Veteran did not timely report his income. The Board finds that the Veteran is at fault in the creation of the debt. With respect to the third factor, financial hardship, the pertinent regulation provides that consideration should be given to whether collection of the indebtedness would deprive the debtor of basic necessities. 38 C.F.R. § 1.965 (a)(3). "Financial hardship" is primarily intended to mean that he or she would be deprived of basic necessities, such as food, clothing, and shelter. The Board has considered whether the Veteran would suffer undue financial hardship if forced to repay the debt. The Veteran asserts repayment of the debt would cause financial hardship, as his spouse has significant medical expenses related to chronic illness. In the September 2013 Financial Status Report (FSR), the Veteran reported medical expenses of $1,254.00 per month. However, a review of itemized medical expenses reported by the Veteran indicates that this expense is inflated on the FSR. In February 2013, the Veteran submitted a medical expense report which showed medical expenses averaging $430.00 per month in 2012. In July 2015 the Veteran submitted a list of itemized medical expenses, in which he reported monthly medical expenses of $542.00. The Board notes that per the September 2019 Board remand, in February 2020 the RO requested that the Veteran complete and return a FSR for each year since 2013 to assist in the consideration of his assertion of financial hardship due to substantial medical expenses. The Veteran did not respond. The Board emphasizes that the duty to assist is a two-way street; the Veteran must actively participate in the process of obtaining evidence to support his claim. See Wood v. Derwinski, 1 Vet. App. 190, 193 (1991). Here, he has not provided the requested information to clarify pertinent income and expenses to assist in determining whether repayment of the overpayment debt would cause undue financial hardship. The available FSR shows that the Veteran's household income exceeds his basic expenses, even after accounting for the itemized medical expenses reported in 2012 and 2013. While the Veteran has other consumer debt, the current valid debt to the U.S. Government should be accorded the same consideration as other creditors. Therefore, the Board finds that collection of the debt would not impair the Veteran's ability to provide for basic necessities. The Board finds that recovery of the overpayment would not defeat the purpose for which benefits were intended. The award and disbursement of pension benefits was made for the support of the Veteran for the period from March 2011 through July 2013 at a rate based on the Veteran's income. Because he failed to identify relevant income during this time period, he received benefits in excess of what he was entitled. Thus, the collection of the debt would not defeat the purpose for which the benefits were intended. Because the Veteran was in receipt of VA pension benefits to which he was not entitled, the Board finds that he was unjustly enriched by the amount of the overpayment. Additionally, because the debt has already been repaid, a waiver of such an overpayment would essentially require VA to pay the Veteran additional benefits that were not due to him and would, again, result in unjust enrichment. The Board finds that there is no evidence showing that the Veteran relinquished a valuable right or incurred any legal obligations resulting from reliance on VA benefits. The Board also notes that there is no indication that the Veteran detrimentally changed his position in reliance on the overpayment or incurred a legal obligation. Based on the above, the Board finds the weight of the elements of equity and good conscience are not in the Veteran's favor. Accordingly, waiver of recovery of the overpayment is not warranted, and the claim must be denied. TANYA SMITH Veterans Law Judge Board of Veterans' Appeals Attorney for the Board T. Bynum, Associate Counsel 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.