Citation Nr: 21077509 Decision Date: 12/30/21 Archive Date: 12/30/21 DOCKET NO. 18-48 081 DATE: December 30, 2021 REMANDED Whether a waiver of recovery of an overpayment of Department of Veterans Affairs (VA) compensation benefits in the amount of $27,699.96, is warranted, to include the validity of the debt, is remanded. REASONS FOR REMAND The Veteran served on active duty from December 1986 to December 2012. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a June 2018 decision issued by the Committee on Waivers and Compromises (COWC) of the Department of Veterans Affairs (VA) Regional Office (RO). In May 2021, the Veteran testified before the undersigned Acting Veterans Law Judge at a hearing. A copy of the transcript is associated with the Veteran's claims file. As an initial point of clarification, the Board, on review, found that the Veteran filed a notice of disagreement (VA Form 21-0958) under the legacy review system in July 2018, and then filed a notice of disagreement seeking Higher-Level Review by the agency of original jurisdiction (AOJ) under the Rapid Appeals Modernization Program (RAMP) in the modernized review system, one month later. As a statement of the case was issued under the legacy review system shortly after receiving both notices of disagreement, and the Veteran has not objected to being reviewed under the legacy review system, the Board finds this matter is currently and properly docketed under the legacy review system, and thus, will proceed with de novo review under such system. Whether a waiver of recovery of an overpayment of VA compensation benefits in the amount of $27,699.96, to include the validity of the debt, is remanded. The Veteran contends that his overpayment was created by mistake when he accidentally checked box 20 that indicated he did not want to receive VA compensation in lieu of military retired pay on his January 2017 VA Form 21-526EZ. He avers that he was unable to correct that error when he did not timely receive VA's letter in May 2017 that proposed to stop his VA compensation benefits due to his election, because he moved, and the letter was sent to his old address. See Hearing Transcript, pages 2-3; July 2018 correspondence. Historically, the Veteran had been receiving VA compensation benefits for service-connected disabilities that exceeded 30 percent, effective January 1, 2013. As his combined disabilities rating exceeded 30 percent, he may receive an additional amount of compensation payable for a dependent or dependents as per 38 C.F.R. § 3.4(b). By October 2014, VA notified him that he was being paid VA compensation benefits at a rate for a veteran plus four dependents (spouse plus three minor children), effective February 2013. The letter also informed him that he may be eligible for full or partial concurrent receipt of VA compensation and military retired pay. Additionally, due to the number of years served by the Veteran, he was automatically enrolled in the Concurrent Retirement and Disability Payment (CRDP) program. CRDP is a program that is available to military retirees who served a minimum of 20 years creditable service and restores some or all of the military retired pay that was deducted due to receipt of VA service-connected disability compensation, which applies here, as the Veteran initially elected to receive VA compensation at the time he first applied and was awarded service connection. Retirees are not required to apply for this benefit; enrollment is automatic. Given his eligibility, he was informed in December 2014 that he was entitled to retroactive compensation benefits beginning February 2013 due to CRDP. Thereafter, in April 2015, the Veteran submitted two VA Forms 21-674, Report of School Attendance forms; one for B.D., and one for B.T., twins who reached 18 years of age and would normally otherwise have been removed from being counted toward the additional allowance added to the Veteran's VA compensation benefits. The allowance is generally discontinued when a dependent child turns 18, or when the child turns 23 if he or she is enrolled in school. 38 C.F.R. §§ 3.503, 3.667. However, the additional allowance may continue from a child's 18th birthday based upon school attendance, if the child was at that time pursing a course of instruction at an approved educational institution and a claim for such benefits is filed within one year from the child's 18th birthday. In May 2015, VA informed the Veteran that he would now be paid at a rate for a veteran and three dependents. VA removed B.T., as he turned 18, effective August [REDACTED], 2004, but B.D. continued to be counted, effective September 1, 2014, as he was enrolled in school. Then, in January 2017, the Veteran submitted a VA Form 21-526EZ to apply for an increase in benefits due to his service-connected disabilities and for additional service-connected disabilities. On page nine, he checked box 20 that elected to receive military retired pay instead of VA compensation. Subsequently, in May 2017, VA informed him of the decision for his claim and also pointed out to him that on his January 2017 application for benefits, the Veteran elected to no longer receive VA compensation. VA explained that his compensation payments would be stopped from the date of his election, January 2017, and let him know that if this election was in error, to please complete the enclosed VA Form 21-651, Election of Compensation in Lieu of Retired Pay or Waiver of Retired Pay to Secure Compensation from Department of Veterans Affairs, within 60 days. VA would not take action to stop benefits for these 60 days. This letter was mailed to an address in the city of Englewood. In March 2018, VA stopped the Veteran's VA compensation as no response was received. The Debt Management Center (DMC) informed the Veteran 11 days later that an overpayment in the amount of $27,699.96 was created. These letters were mailed to an address in the city of Englewood. The Veteran called twice in late March 2018. The first was to request a copy of the March 2018 VA letter, and the second was in reference to the VA letter that stopped his VA compensation benefits. In the second telephone conversation, he stated that both of his twin children were enrolled in college, that proper VA forms were submitted in June 2014, but that only one was processed. He also requested a reconsideration of the halt in VA compensation benefits, as checking box 20 on the application for benefits form was a mistake. The Veteran also submitted a signed VA Form 21-651 that indicated he elected to receive VA compensation and not military retired pay. See March 2018 VA Form 21-651. Along with that form, the Veteran submitted another authorization form that reflected that his current address was now in the city of Clayton. He stated that he never intended to elect military retired pay in lieu of VA compensation and that this overpayment created a financial hardship. This statement also reflected his current address was now in the city of Clayton. See April 2018 VA Form 21-4138, Statement in Support of Claim. Additionally, the Veteran submitted current enrollment verification certificates that indicated both B.D. and B.T. were enrolled and continuing their education. See June 2018 VA Form 4-1837 Decision of Waiver on Indebtedness, pages 11-12. In June 2018, the COWC denied his request for waiver. Three months later, VA informed him that his VA compensation was restored on March 26, 2018, as a result of receiving his signed VA Form 21-651. At the hearing before the undersigned, the Veteran testified that at the time the May 2017 letter was sent, he was in the process of moving from Englewood to Clayton and never received that notice in the mail. He indicated that he would have acted and corrected his error at that time, had he received it. See Hearing Transcript, page 3. The Veteran indicated that he fully intended to receive VA compensation and never intended to check that box on his application for benefits. See Hearing Transcript, page 4. Given the complex history above, the Board finds that a remand is warranted for the RO to resolve whether the overpayment was validly created. Based on the record, the Board construes the Veteran's hearing testimony and statements as a challenge to the validity of the debt. The Board notes that a Veteran has the right to dispute the existence and amount of the debt. 38 C.F.R. § 1.911(c). In determining whether a waiver of overpayment is appropriate, VA must first determine if the overpayment at issue was validly created. See Schaper v. Derwinski, 1 Vet. App. 430, 434-35 (1991) (noting that before adjudicating a waiver application, the lawfulness of the overpayment must first be decided). As noted, the Veteran contends that he did not receive the May 2017 letter that afforded him an opportunity to correct his error. The letter was sent to his address in the city of Englewood, and the evidence received thereafter showed that he was actually in the city of Clayton. The Board finds that this statement is supported by findings from the record, (i.e., calling in to ask for a copy of the March 2018 letter, indicating he did not receive the initial letter) and thus, finds the Veteran credible. Based on the facts that he did not receive the May 2017 VA letter that proposed to reduce his benefits, that B.T. was not properly added to the Veteran's award for an additional allowance in VA compensation benefits, and that VA shortly reinstated the Veteran's VA compensation benefits in March 2018 after receive VA Form 21-651, a remand is warranted for the RO to correct their error in accounting, provide an audit and explain how the overpayment was calculated, and to reconsider the identified circumstances that resulted in the non-receipt of the May 2017 VA notice. The matter is REMANDED for the following actions: 1. Review and correct the Veteran's accounting based on receipt of the Veteran's April 2015 VA Form 21-674 for B.T. 2. Adjudicate the issue of whether the overpayment debt in this case was properly created, to include consideration of the Veteran's credible statement that he did not receive the May 2017 letter and returned VA Form 21-651 as soon as he discovered his error. Prepare a complete audit of the Veteran's account for the period covering August 2014 to the present, after considering an additional allowance and any CRDP pay, if applicable. The audit should include the amount of overpayment, if any, and a detailed explanation of how the overpayment amount was calculated, and the amount recouped. A copy of the audit must be associated with the claims file. The Veteran must be provided with the proper notice of the amount of the debt and a copy of the audit, as well any appellate rights, if necessary. Jenna Brant Acting Veterans Law Judge Board of Veterans' Appeals Attorney for the Board M. Tang, 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.