Citation Nr: 21008308 Decision Date: 02/16/21 Archive Date: 02/16/21 DOCKET NO. 18-38 402A DATE: February 16, 2021 ORDER Entitlement to waiver of recovery of an overpayment of additional Department of Veterans Affairs (VA) compensation benefits for a dependent spouse in the amount of $4,768.68 is granted. FINDINGS OF FACT 1. The overpayment was not due to the Veteran’s fraud, misrepresentation, or bad faith. 2. Recovery of the debt in this case in the amount of $4,768.68 is against equity and good conscience. CONCLUSION OF LAW Recovery of the overpayment of VA compensation benefits in the amount of $4,768.68 would not be contrary to the principles of equity and good conscience. 38 U.S.C. § 5302; 38 C.F.R. §§ 1.963(a), 1.965. REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran honorably served on active duty from April 1968 to December 1978 and from July 1981 to July 1991. This matter is before the Board of Veterans’ Appeals (Board) on appeal from a July 2017 administrative decision of the VA Committee on Waivers and Compromises (Committee). The Veteran testified before the undersigned at a travel Board hearing in February 2020. A transcript of the hearing is of record. In April 2020, the Board remanded the matter for further development, which has been completed. Entitlement to waiver of recovery of an overpayment of additional Department of Veterans Affairs (VA) compensation benefits for a dependent spouse in the amount of $4,768.68 In July 2017, the Committee denied the Veteran’s request for a waiver. Although the Committee determined that the creation of the overpayment of VA compensation benefits was not due to the Veteran’s fraud, misrepresentation, or bad faith, it further determined that recovery of the remainder of the debt was not against equity and good conscience. VA law provides that recovery of overpayment of any benefits 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 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. § 1.963 (a). The standard “Equity and Good Conscience” will be applied when the facts and circumstances in a particular case indicate a need for reasonableness and moderation in the exercise of the government’s rights. 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. Where actions of the debtor contribute to the creation of the debt. (2) Balancing of faults. Weighing fault of the debtor against VA fault. (3) Undue hardship. Whether collection would deprive debtor or family of basic necessities. (4) Defeat the purpose. Whether withholding of benefits or recovery would nullify the objective for which benefits were intended. (5) Unjust enrichment. Failure to make restitution would result in unfair gain to the debtor. (6) Changing position to one’s detriment. Reliance on VA benefits results in relinquishment of a valuable right or incurrence of a legal obligation. See 38 U.S.C. § 5302; 38 C.F.R. § 1.965 (a). In this case, the Committee found, and the Board agrees, that there is no evidence demonstrating that the indebtedness resulted from fraud, misrepresentation, or bad faith on the Veteran’s part with regard to the remainder of the debt. Therefore, waiver of indebtedness is not precluded if shown that it would be against the principles of equity and good conscience to require the Veteran to repay the debt to the government. 38 C.F.R. §§ 1.963, 1.965. With regard to fault, the Board finds that the Veteran was not at fault in the creation of the debt. The law provides for the rates of disability compensation, and for payment of additional compensation for dependents of veterans who are at least 30 percent disabled. 38 U.S.C. §§ 1114 (c), 1115, 1134, 1135. The Veteran was rated appropriately to receive additional compensation for a spouse during the time period in question. When the Veteran was first awarded benefits for her dependent, specifically her dependent spouse, J., she was informed by July 1995 letter that the failure to notify the RO in a prompt fashion of a dependency change would result in an overpayment. However, here, the Veteran and her spouse were both veterans in receipt of VA benefits. In June 2012, the Veteran submitted an Application for Dependency and Indemnity Compensation, Death Pension, and Accrued Benefits by a Surviving Spouse or Child, as well as a death certificate indicating that her spouse, J., had died in April 2012. This notified the VA of the Veteran’s spouse’s death with respect to his own benefits. The Board acknowledges that the Veteran did not separately notify VA of her spouse’s death with respect to her own benefits. However, the Veteran should not be penalized for not knowing that she needed to notify VA twice. It was reasonable for her to assume that notifying VA of her husband’s death with respect to his benefits also put VA on notice with regards to her own benefits. Unfortunately, the veterans’ benefits system does not take into consideration dual-veteran households. As such, the Board finds the Veteran was not at fault in the creation of the debt. In regard to whether failure to collect would cause unjust enrichment to the debtor, the Board notes that the Veteran received benefits to which she was not entitled and as such, would cause unjust enrichment to the debtor. Likewise, there is no indication that the Veteran’s reliance on VA benefits resulted in relinquishment of another valuable right. As to whether recoupment of those benefits would defeat the purpose of the benefit, it would not because the Veteran was receiving benefits for a spouse during this time when her spouse was deceased. The Board has also considered whether the Veteran would suffer undue financial hardship if forced to repay the debt at issue. A review of the financial status report reveals that monthly income exceeds expenses. The Board acknowledges that in an October 2020 statement, the Veteran reported that she was also financially supporting her now-deceased sister and brother-in-law. However, the financial status report indicates significant assets in the form of cash and real estate; as such, there is no financial hardship.   In this case, the Board finds that a waiver is warranted. The Veteran was not at fault in the creation of the debt, and based on the particular facts of this case, the Board finds that element outweighs the elements not in the Veteran’s favor, and she should therefore not be penalized. Accordingly, a waiver of the recovery of the overpayment of the debt of $4,768.68 is warranted. DAVID L. WIGHT Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board A. Dean, 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.