Citation Nr: A21020048 Decision Date: 12/15/21 Archive Date: 12/15/21 DOCKET NO. 210227-140109 DATE: December 15, 2021 ORDER Entitlement to a waiver of recovery of overpayment of Department of Veterans Affairs (VA) benefits in the amount of $18,810.00, to include the question of whether the overpayment was properly created, is remanded. REASONS FOR REMAND The Veteran served on active duty from July 1976 to May 1977. In a December 2020 VA Form 10182 Notice of Disagreement (NOD), the Veteran selected Direct Review and expressed disagreement with a November 2020 notification letter, indicating that she notified VA in June 2012 of her divorce, that she cannot afford to repay the full amount of the debt, and that she was not aware that she was in receipt of benefits to which she was not entitled. In a subsequent February 2021 VA Form 10182 NOD, the Veteran noted disagreement with a December 2020 decision, noting that she had previously informed VA of her divorce but that she would agree to a payment plan. Generally speaking, an overpayment debt is created when VA determines that a beneficiary has received benefits to which they were not entitled. When a Veteran's dependency status changes, it results in a reduction in their eligible benefits. Until VA is made aware of the change and adjusts the benefits accordingly, the Veteran may incorrectly continue to receive benefits at the previous rate. Upon notification of the change, VA discontinues the dependent benefits retroactively at the proper rate, assessing a debt to the Veteran for benefits received but to which they were no longer entitled from the effective date of the change in dependency status. Here, it appears from review of the record that the overpayment debt in question was created because the Veteran continued to receive dependency benefits after her divorce from her husband in March 2011. In a June 2012 status of dependents questionnaire, the Veteran indicated that she was not married. Since that time, the Veteran received multiple notification letters regarding her benefits; the letters do not mention any changes in her dependents' status. In June 2020 correspondence, it advised that she must immediately notify VA of any change in her dependents' status, and in September 2020, VA notified the Veteran that they proposed to reduce her benefits because she did not verify the status of her dependents. In response, the Veteran submitted a statement indicating that she and her husband divorced in 2011. In a November 2020 notification letter, VA advised that her ex-husband was removed from her award, effective April 1, 2011. Presumably, the Veteran's benefits were adjusted as of April 2011, and that the debt resulted in the difference between benefits eligible to a single Veteran with no dependents as opposed to a Veteran with one dependent. However, none of the correspondence sent to the Veteran, the most pertinent of which is discussed below, explains fully how the debt was created or calculated, and the Veteran has not been notified of all of her due process rights. As the Veteran was not fully advised of the reasons for or the calculation of her debt, and she was not adequately advised of her rights to request a waiver or to appeal the creation of the debt, this represents a failure of VA's duty to notify and assist the Veteran in her claim. Thus, remand is warranted to correct this pre-decisional duty to assist error. In the November 2020 notification letter, it advises the Veteran that her spouse was removed from her benefits, effective April 1, 2011 because they divorced on March 29, 2011. It advises that the Veteran had one year from the date of the letter to appeal the decision. It also explains that it was found that the Veteran was overpaid benefits and that a separate letter from the VA's Debt Management Center (DMC) will her more about the overpayment and explain how much she has been overpaid and how to repay the debt. A November 2020 Award Print shows a debt of $18,810.00 and includes remarks of "removed dependent spouse from award: ADL Letter. 0538 6/20/12 no action taken when she indicated she was divorced." In a December 2020 Report of General Information, it shows that the Veteran requested an appeal of the recent dependency award removal of spouse. It notes that a review of the file shows that notification of divorce was received on June 12, 2012 from the Veteran. The VA employee noted that questions remained regarding why a subsequent development letter was not sent to the Veteran requesting marriage or divorce information due to her being paid at the Dependent Rate for the spouse in June or July of 2012. A First Demand Letter from DMC is not of record and attempts to associate any letters from DMC with the record have been unsuccessful. As noted in the October 2021 email correspondence, there is no record of a DMC letter available, there is no waiver request of record, and there is no decision from the Committee on Waivers and Compromises. 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. 38 C.F.R. § 1.911(c)(1). Resolution of the creation issue must precede any consideration of a waiver issue. Here, in the December 2020 and February 2021 NODs, the Veteran noted disagreement with the debt. In a December 2020 statement accompanying the NOD, she noted financial difficulties, that she informed VA in June 2012 of her divorce, and that she was not aware that she was still receiving benefits for him. In addition, in the June 2021 brief, the Veteran's representative asserted that the debt was created due to sole VA administrative error. Thus, this represents a challenge to the validity of the debt as well as an assertion that a waiver of the debt is needed. The Board shall decide all questions pertaining to its jurisdictional authority to review a particular case. 38 C.F.R. § 20.104(c). Additionally, decisions of the Board must be based on a de novo review of the evidence of record at the time of the agency of original jurisdiction (AOJ) decision on the issue or issues on appeal, and any additional evidence considered as part of the evidentiary record pursuant to applicable statute and regulation. 38 U.S.C. §§ 7104(d), 7113; 38 C.F.R. § 20.801(a). In this case, the Board does not have before it the evidence necessary to determine its jurisdiction, such as the DMC First Demand Letter regarding the Veteran's overpayment debt, and the Veteran has not been notified of her due process rights. As such, she was not put on notice of the additional steps that must be taken if she disagreed with the overpayment debt assessed to her. In this case, there was a pre-decisional duty to assist error as the AOJ erred in not providing sufficient notice explaining the Veteran's overpayment debt and not ensuring that all the necessary evidence was of record for review by the Board. Without adequate notice of the basis for the denial, a claimant cannot make an informed decision as to whether or not to accept or appeal the decision or know what evidence they need to submit in order to substantiate their appeal. See Ingram v. Nicholson, 21 Vet. App. 232, 252 (2007) (discussing the legislative history of 38 U.S.C. § 5104 and the importance of clear and informative notice of decisions). Thus, the Board cannot determine whether it has jurisdiction to adjudicate the instant appeal and cannot fulfill its statutory and regulatory requirement to base its decision on a review of the evidence of record at the time of the AOJ decision on the issue(s) on appeal. Under AMA, the Board may remand for correction of either a pre-decisional duty to assist error or "any other error by AOJ in satisfying a regulatory or statutory duty, if correction of the error would have a reasonable possibility of aiding in substantiating the appellant's claim." See 38 C.F.R. § 20.802. The Board considers it a correctible error by the AOJ in satisfying their regulatory and statutory duties under 38 U.S.C. § 5302(b) and 38 C.F.R. § 1.965 and that correction raises a reasonable possibility of aiding in substantiating the Veteran's claim. Accordingly, remand under AMA for these and similar circumstances remains appropriate. The matter is REMANDED for the following action: 1. The AOJ must ensure that the electronic record is complete, to include obtaining a copy of the original DMC First Demand Letter, if available. The AOJ should ensure that all evidence upon which the debt decision is based is identified in the notice to the Veteran and associated with the record. If it is determined that no such document exists due to a typographical or other error, issue a formal finding in accordance with the provisions of 38 C.F.R. § 3.159(e)(1). 2. If an original DMC First Demand Letter is not available, re-issue notice of the overpayment to the Veteran. Associate the notice with the record. (a.) Provide the Veteran with notice of the specific reasons for the overpayment debt, the full amount of the debt, and her rights regarding contesting the creation of the debt and requesting a waiver, in simple and concise language. 3. Perform a detailed paid and due audit of the Veteran's compensation payments. 4. Adjudicate the issue of whether the Veteran's debt was properly created, including the assertion of sole VA administrative error. The AOJ must make an administrative decision regarding the validity of the debt. The AOJ must address the Veteran's assertion that she notified VA in June 2012 of her divorce. 5. Afford the Veteran with the opportunity to submit a VA Form 5655, Financial Status Report, listing all monthly income, expenses, assets, and debts, for the Veteran and any dependents. Supporting documentation should be requested from the Veteran as deemed appropriate. 6. After affording the Veteran all necessary due process, and undertaking the necessary development, adjudicate the issue of waiver of recovery of an overpayment of VA compensation benefits, including referral of the waiver request to the Committee on Waivers and Compromises. 7. The Veteran must be advised how to timely appeal and/or request review of the decision. 38 C.F.R. § 20.203. L. B. CRYAN Veterans Law Judge Board of Veterans' Appeals Attorney for the Board A. Labi, 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.