Citation Nr: 21010815 Decision Date: 02/25/21 Archive Date: 02/25/21 DOCKET NO. 11-31 954 DATE: February 25, 2021 ORDER Entitlement to waiver of recovery of disability benefits in the amount of $42,848.00 is denied. 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 is not against equity and good conscience. CONCLUSION OF LAW Recovery of the overpayment of VA disability benefits 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 had active service from January 1969 to February 1971. This matter comes before the Board of Veterans’ Appeals (Board) on appeal from a December 2010 administrative decision of the Department of Veterans Affairs (VA) Regional Office (RO). It was most recently before the Board in February 2018, when it was remanded for further development, specifically for adjudication of whether the overpayment was properly created. This separate issue is not in appellate status. Entitlement to waiver of recovery of disability benefits in the amount of $42,848.00 The Veteran’s overpayment is derived from VA pension. A September 2006 rating decision granted entitlement to pension benefits. The Veteran was provided VA Form 21-8768 which stated, in pertinent part, that the Veteran was obligated to provide prompt notice of any change in family income or net worth and that a failure to provide such would result in the creation of an overpayment which would be subject to recovery. It further stated that when reporting income, the total amount and source of all income received should be reported. A review of the evidence reflects that the Veteran had income in 2006, 2007, and 2008 that he did not timely report to VA. As well, VA erred by failing to consider part of his income that he reported when calculating his award. These actions resulted in an overpayment. The Veteran requested a waiver of the recovery of the overpayment. 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. Therefore, waiver of indebtedness is not precluded if shown that it would be against the principles of equity and good conscience to require the appellant to repay the debt to the government. 38 C.F.R. §§ 1.963, 1.965. Here, the Veteran did not promptly notify VA of all of his income. As noted earlier, VA also made an error when processing the Veteran’s pension claim, as discussed in a March 2020 administrative decision. Therefore, the Board finds the Veteran and VA were both at fault in the creation of the debt. However, waiving recovery of the overpayment would defeat the purpose of the benefit because the Veteran was not entitled to receive the amount of pension he was paid. There is also no evidence that the Veteran changed position to his detriment due to his reliance upon receipt of VA benefits. To the extent the Veteran contends there is financial hardship, that factor is outweighed by the other elements of equity and good conscience. The Veteran has stated on an April 2011 Financial Status Report that his monthly net income is $700.00. He reported that his monthly expenses total $1,000.00. Therefore, his monthly expenses exceed his income. However, the Board notes that this information does not include the Veteran’s since-restored pension benefits. The Board acknowledges the Veteran’s financial difficulties, including that he has minimal assets and reports various debts. However, as the overpayment at issue represents a valid debt to the U.S. Government, there is no reason that the Veteran should not accord the Government the same consideration that he accords his other creditors. For these reasons, the Board finds that any financial hardship the Veteran may experience from recovery of this debt is outweighed by the other elements of equity and good conscience. In this case, the Board finds that a waiver of the recovery of the overpayment is not warranted. Nathaniel J. Doan 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.