Citation Nr: 21075759 Decision Date: 12/21/21 Archive Date: 12/21/21 DOCKET NO. 18-38 500A DATE: December 21, 2021 ORDER As the appellant's request for waiver of recovery of an overpayment of educational assistance benefits under the Transfer of Entitlement provisions of Chapter 33, Title 38, United States Code (known as the Post-9/11 GI Bill) in the total initial amount of $80,607.70 was timely filed, the appeal as to this issue is granted. REMANDED The issue of entitlement to waiver of recovery of an overpayment of Chapter 33 educational assistance benefits in the amount of $80,607.70, to include whether the debt was validly created, is remanded. FINDINGS OF FACT 1. The February 10, 2016, notices of indebtedness in the amounts of $3,375.00, $33,317.70, and $43,915.00 were not mailed to the appellant's last known address. 2. The appellant's application for waiver of recovery of the assessed overpayment of Chapter 33 educational assistance benefits in the calculated total amount of $80,607.70 was received on September 7, 2017, the same month that she was notified by a VA employee of her right to request a waiver. CONCLUSION OF LAW The appellant's request for waiver of recovery of overpayment of Chapter 33 educational assistance benefits was timely filed. 38 U.S.C. § 5302(a); 38 C.F.R. § 1.963(b). REASONS AND BASES FOR FINDINGS AND CONCLUSION Evidence of record indicates that the Veteran served in the United States Army Reserves from March 15, 1994, to December 14, 2015, which service included periods of active duty from May 22, 2006, to November 17, 2007, from December 15, 2007, to December 6, 2009, and from November 8, 2011, to December 11, 2012. The appellant in this case is the Veteran's former spouse. This matter comes to the Board of Veterans' Appeals (Board) on appeal from September 2017 decisions issued by the Department of Veterans Affairs (VA) Debt Management Center (DMC) in Fort Snelling, Minnesota, in which the DMC determined that the appellant's request for a waiver of indebtedness in the initial amounts of $3,375.00 (books and supplies), $33,317.70 (housing allowance), and $43,915.00 (tuition and fees) was untimely. The appellant disagreed with that decision and this appeal ensued. In August 2021, the appellant testified during a Board hearing before the undersigned Acting Veterans Law Judge. A transcript of that hearing is of record. Timeliness of Waiver At the outset, the Board notes that the issue perfected for appeal to the Board is whether the appellant's request for a waiver of recovery was timely made. Given the Board's favorable finding with regard to this issue, the Board has expanded the appellant's appeal to encompass the underlying issue of entitlement to waiver of recovery of an overpayment of Chapter 33 educational assistance benefits in the amount of $80,607.75, to include whether the debt was validly created, which issue is remanded, as set forth below. Turning to whether the appellant's request for waiver of recovery of an overpayment of VA educational assistance benefits under the Transfer of Entitlement provisions of Chapter 33 in the amount of $80,607.70 was timely filed, the Board points out that a request for waiver of indebtedness must be made within 180 days following the date of a notice of indebtedness, for notices issued on or after April 1, 1983. 38 U.S.C. § 5302(a); 38 C.F.R. § 1.963. The 180-day period may be extended if the individual requesting waiver demonstrated to the Chairperson of the Committee that, as a result of an error by either VA or the postal authorities, or due to other circumstances beyond the debtor's control, there was a delay in such individual's receipt of the notification of indebtedness beyond the time customarily required for mailing (including forwarding). Id. If the requester does substantiate that there was such a delay in the receipt of the notice of indebtedness, the Chairperson shall direct that the 180-day period be computed from the date of the requester's actual receipt of the notice of indebtedness. 38 C.F.R. § 1.963. In this regard, the Board notes that a letter was sent on January 7, 2016, with the intent to inform the appellant that because the Veteran did not complete his service obligation, she was not eligible for VA educational assistance benefits under the Transfer of Entitlement provisions of Chapter 33. The letter informed the appellant that because of this change, VA had paid her more than she was due, which resulted in an overpayment of tuition and fees, books and supplies, and monthly housing allowance in the total amount of $80,607.70. The letter stated that VA's DMC would be sending additional information about the debt, how to repay the debt, and the appellant's rights regarding the debt. Notably, that letter was sent to the appellant at an address on [REDACTED] in [REDACTED], New York. It appears then that the January 2016 letter was returned as undeliverable as the claims file shows that that letter was remailed to the appellant at an address on [REDACTED] in [REDACTED], New York. The record then contains three debt notification letters from the DMC, each dated on February 10, 2016. A review of these letters shows that they contained information regarding the amounts of the overpayment, as well as informed the appellant of her right to request a waiver. However, these debt notification letters were mailed to the appellant at the same address on [REDACTED] to which the January 2016 letter had first been sent. During her August 2021 hearing, the appellant testified that she did not receive any of the February 2016 debt notification letters informing her of the right to request a waiver and notifying her of the time limit in which to do so. The appellant also pointed out that the January 2016 letter that was resent to her at her then-current address on [REDACTED] in [REDACTED], New York, did not contain any information regarding her right to request a waiver. The appellant reported that she only learned of her right to request a waiver in September 2017 when she contacted VA regarding her debt after her tax refund was garnished. The appellant then requested a waiver of recovery of the overpayment of Chapter 33 educational assistance benefits that same month, which waiver was denied as the appellant's request for such was not received within 180 days of the February 2016 debt notification letters. In the instant case, although there is no evidence that the February 10, 2016, debt notification letters were returned as undeliverable, it is clear that the appellant had provided VA with a different address prior to the February 10, 2016, mailing. Notably, the appellant reported that she ceased living at the address on [REDACTED] in [REDACTED], New York, on April 15, 2014. A review of the record then shows that letters from the DMC dated in January and April 2015 were sent to the appellant at an address on [REDACTED] in [REDACTED], New York, and that DMC letters dated in July and August 2015 were sent to the appellant at her address on [REDACTED] in [REDACTED], New York. The Board again points out that the January 2016 letter initially sent to the appellant at the address on [REDACTED] was later resent to her at her address on [REDACTED]. The Court has held that the "[t]here is a presumption of regularity under which it is presumed that government officials 'have properly discharged their official duties.'" Ashley v. Derwinski, 2 Vet. App. 307, 308 (1992) (quoting U.S. v. Chem. Found., Inc., 272 U.S. 1, 14-15 (1926)); see Mindenhall v. Brown, 7 Vet. App. 271 (1994) (applying presumption of regularity to procedures at the Regional Office). The presumption of regularity may, however, be rebutted by clear and convincing evidence to the contrary. While "[a]n 'assertion of nonreceipt, standing alone, does not rebut the presumption of regularity in VA's mailing process,'" Clarke v. Nicholson, 21 Vet. App. 130, 133 (2007) (quoting Jones v. West, 12 Vet. App. 98,102 (1998)), the Court has specifically held that VA's use of an incorrect address for a claimant will constitute the "clear evidence" needed to rebut the presumption of regularity. Crain v. Principi, 17 Vet. App. 182, 189 (2003) (holding that use of "an incorrect ZIP Code for the appellant, in conjunction with the appellant's assertion of nonreceipt . . . constitutes the clear evidence that is needed to rebut the presumption of regularity"); see Piano v. Brown, 5 Vet. App. 25, 27 (1993) (finding that one-digit error in the street address showed that "the mailing . . . appeared to be 'irregular'"). Upon review of the evidence of record, to include the various addresses known by VA as evidenced by their use of addresses other than the one on [REDACTED] after April 2014, the Board cannot conclude that the February 10, 2016, letters notifying the appellant of the amount of the overpayment and of her right to request a waiver were mailed to the appellant's then-known current address. Although there is no evidence that the February 10, 2016, letters were returned as undeliverable, the appellant alleged that she did not receive those letters, and it is clear that the DMC was aware of her address on [REDACTED] at the time the February 2016 letters were mailed. Again, the Board points out that the DMC mailed letters to the appellant at her address on [REDACTED] in July and August 2015. Given these facts, the Board finds that the record contains clear evidence necessary to rebut the presumption of regularity that the agency of original jurisdiction (AOJ) properly mailed notice of its February 2016 notices of indebtedness to the appellant at her then-known address. As such, the 180-day period for filing a request for waiver of indebtedness did not begin to run until the appellant received information concerning her repayment of indebtedness that included information on requesting a waiver. See 38 C.F.R. § 3.1(q) (providing that "notice" means written notice sent to a claimant or payee at his latest address of record); see generally Lamb v. Peake, 22 Vet. App. 227, 230 (2008) ("It is now well established that if a claimant is not properly notified of an RO decision and how it may be appealed, then the time to appeal that decision is tolled."). Here, the appellant has reported that she did not receive information regarding her right to request a waiver until September 2017, when she contacted VA regarding her debt. The Board has no reason to disbelieve the appellant's report in this regard, and the evidence of record does not otherwise suggest that the appellant was informed of her right to request a waiver prior to September 2017. Accordingly, the Board finds that the appellant's September 2017 request for waiver of recovery of an overpayment of VA educational assistance benefits under the Transfer of Entitlement provisions of Chapter 33 in the amount of $80,607.70 was timely. REASONS FOR REMAND Having found that the appellant's request for waiver was timely filed, the Board finds it necessary to remand the underlying issue of entitlement to waiver of recovery of an overpayment of Chapter 33 educational assistance benefits in the amount of $80,607.70, for adjudication by the AOJ in the first instance. The Board also finds that, on remand, the AOJ must consider whether the debt was validly created. This is so because the appellant, in her notice of disagreement, questioned whether the debt was validly created, noting that the circumstances surrounding the Veteran's discharge from service were not evident from the record. In this regard, the Board notes that the law provides that that the Secretary of Defense or, in this case, the Secretary of the Army, may approve a member of the Armed Forces who is entitled to basic educational assistance under Chapter 33, under certain circumstances, to elect to transfer to one or more dependents the unused portion of entitlement to such assistance. 38 U.S.C. § 3319(a). To be eligible to transfer educational assistance benefits, a transferor must have served six years on active duty or in the Selected Reserve at the time of his approval by the Secretary of the Army and must have entered into an agreement to serve at least four more years as a member of the Armed Forces. 38 U.S.C. § 3319(b). The law further provides that if an individual transferring entitlement under 38 U.S.C. § 3319 fails to complete the service agreed to in accordance with the terms of the agreement of the individual under 38 U.S.C. § 3319(b)(1), the amount of any transferred entitlement under this section that is used by a dependent of the individual as of the date of such failure shall be treated as an overpayment of educational assistance. 38 U.S.C. § 3319 (i)(2)(A). Exceptions however exist and subparagraph (A) will not apply in the case of an individual who fails to complete service agreed to by the individual (1) by reason of the death of the individual or (2) for a reason referred to in 38 U.S.C. § 3311(c)(4). 38 U.S.C. § 3319(i)(2)(B). In accordance with 38 U.S.C. § 3311(c)(4), if the individual transferring entitlement fails to complete the service agreed to due to early discharge or release from active duty for (1) a medical condition which preexisted the applicable period of service of the individual and which the Secretary of the military department concerned determines is not service-connected; (2) hardship; or (3) a physical or mental condition that was not characterized as a disability and did not result from the individual's own willful misconduct but did interfere with the individual's performance of duty, as determined by the Secretary concerned in accordance with regulations prescribed by the Secretary of Defense, an overpayment of education assistance benefits will not be assessed. 38 U.S.C. § 3311(c)(4); 38 C.F.R. § 21.9570(l)(1)(i). The record shows that the Veteran was originally approved to transfer his remaining Chapter 33 benefits to the appellant. However, after the appellant had used her transferred entitlement, it was discovered that the Veteran did not complete his obligated period of service. It was thus determined that the appellant was paid Chapter 33 benefits to which she was not entitled and a debt resulting from the overpayment was created. However, the appellant has questioned whether the revocation of the transferred entitlement was valid, asserting that the record does not contain sufficient information to determine whether the Veteran falls within one of the exceptions identified in 38 C.F.R. § 21.9570(l)(1)(i). The Board agrees. Accordingly, prior to adjudicating whether the education debt at issue in this case was validly created, the AOJ should obtain all relevant records related to the Veteran's discharge from service, so as to determine whether the circumstances of his separation from service prior to his service obligation date qualify for an exception to the general rule that failure to complete the service agreed to in accordance with the terms of the agreement of the individual under individual under 38 U.S.C. § 3319(b)(1) will result in an overpayment of educational assistance benefits used by a transferee. The matter is REMANDED for the following action: (Continued on the next page) 1. Obtain and associate with the claims file the Veteran's service personnel records, to include all records related to his discharge from service. All attempts to obtain these records should be documented. 2. Then, after undertaking any other development deemed appropriate, the adjudicate the issue of entitlement to waiver of recovery of an overpayment of Chapter 33 educational assistance benefits in the amount of $80,607.70, to include whether the debt was validly created. In doing so, the AOJ must specifically consider whether the circumstances of the Veteran's separation from service prior to his service obligation date qualify for an exception to the general rule that failure to complete the service agreed to in accordance with the terms of the agreement of the individual under individual under 38 U.S.C. § 3319(b)(1) will result in an overpayment of educational assistance benefits used by a transferee. TRACIE N. WESNER Acting Veterans Law Judge Board of Veterans' Appeals Attorney for the Board K. Neilson, 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.