Citation Nr: 21011289 Decision Date: 03/01/21 Archive Date: 03/01/21 DOCKET NO. 20-12 383 DATE: March 1, 2021 ORDER The September 2016 request for waiver of indebtedness was timely filed; to this extent only, the appeal is granted. REMANDED Entitlement to waiver of recovery of an overpayment of VA pension benefits in the amount of $141,770.00 is remanded. FINDING OF FACT The record reflects that the Veteran did not receive proper notice of the time limit or period to file his application to request a waiver of overpayment of pension benefits in the amount of $141,770.00 for the debt created from August 28, 2012; therefore, his application for wavier of recovery must be deemed timely filed. CONCLUSION OF LAW Resolving all doubt in the Veteran’s favor, his request for waiver of overpayment was timely filed. 38 U.S.C. § 5302(a); 38 C.F.R. § 1.963(b). REASONS AND BASES FOR FINDING AND CONCLUSION The Veteran served on active duty from January 1962 to February 1965. Timeliness of Request for Waiver on Indebtedness A request for waiver of a debt, other than for loan guaranty, shall only be considered if made within 180 days following the date of a notice of the indebtedness to the debtor. The 180-day period may be extended if the individual requesting waiver demonstrated to the Chairperson of the Committee that, because 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. 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. See 38 C.F.R. § 1.963(b); see also 38 U.S.C. § 5302(a). Analysis The Veteran contends that he should be granted a waiver of the debt that was created due to the retroactive adjustment of his pension benefits. In October 1979, the Veteran was awarded VA pension benefits. The Veteran was instructed to immediately notify VA if there was any change in his income or net worth or the net worth of any dependent for whom he was receiving benefits. On a May 2011 Award Print, it was noted that the Veteran received income that he did not reported. On June 3, 2011, the Debt Management Center (DMC) assessed a debt of $8,060.00. The letter informed the Veteran of his right to request a waiver of recovery of the overpayment. The Veteran did not request a waiver or challenged the validity of the debt. As such, the debt created in June 2011 is not before the Board. In February 2012, the Veteran submitted an Eligibility Verification Report (EVR). He noted that his wife received bonds worth $447.45, and she also had 134 acres in real property. Based on this information, VA proposed to terminate the Veteran’s pension benefits. An August 24, 2012 award print noted that the Veteran owed $141,770.00. On August 28, 2012, VA terminated the Veteran’s pension benefits from January 1, 1994. VA stated that because of this change, the Veteran was paid too much. VA also stated that it would inform the Veteran of how much he was overpaid and how he could repay this debt. On September 13, 2016, the Veteran requested a waiver of his $141,770.00 overpayment debt. In March 2017, the Committee on Waivers and Compromises (COWC) denied waiving the Veteran’s overpayment debt of $149,958.00. COWC stated that the Veteran was notified of his waiver rights on June 3, 2011. However, his waiver request was not submitted within 180 days of the DMC notice letter. As such, COWC denied his request. Based on the evidence of record, the Board finds that the Veteran’s request for a waiver of recovery of the debt was timely filed. The Board notes that VA initially informed the Veteran of the debt in August 2012. VA also informed him that he would receive a separate letter regarding this overpayment. However, the Veteran was not provided a DMC notice informing him of the debt amount created from January 1, 1994 and his waiver rights. The Board notes that the only mention of a debt amount exceeding $140,000.00 was generated prior to the termination, and it does not appear that that document was sent to the Veteran. The Board also notes that COWC stated that the Veteran was notified of his waiver rights in June 2011; however, the Board notes that the 2011 DMC letter references a $8,060.00 overpayment debt. As the Veteran never received proper notice of the time limits to file his application to request a waiver of overpayment based on termination of his pension benefits effective January 1, 1994, his application for wavier of recovery must be deemed timely filed. 38 C.F.R. § 1.963(b) (if the debtor does substantiate there was such a delay in the receipt of the notice of indebtedness, the 180-day period shall be computed from the date of the debtor’s actual receipt of the notice of indebtedness). To that extent, the appeal is granted. REASONS FOR REMAND During his June 2019 DRO hearing, the Veteran stated that the property in question was not his wife’s property. He stated that his son owned the property and his wife was listed as a secondary owner. The property was sold in 2012, and the proceeds were used to pay off his son’s debts. The Board finds that the Veteran has challenged the creation of the debt. When a Veteran raises the validity of the debt as part of a waiver claim, it is arbitrary and capricious and an abuse of discretion to adjudicate the waiver application without first deciding a veteran’s challenge to the lawfulness of the debt. Schaper v. Derwinski, 1 Vet. App. 430, 437 (1991). As such, the issue is remanded for consideration of the validity issue. Accordingly, the Board must remand the claim for adjudication of the threshold issue of validity of the debt. Regarding the waiver issue, the Board notes that it is the COWC that has jurisdiction over the question of whether waiver of the Veteran’s debt is appropriate. In this case, the Board notes that the COWC did not adjudicate the issue on its merits. If the debt is deemed valid, the waiver issued should be submitted to COWC for adjudication. The matter is REMANDED for the following action: 1. The AOJ must make an administrative decision regarding the validity of the debt. 2. If the debt is deemed valid, the Veteran should be afforded the opportunity to submit 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. If the Veteran submits the form, his claims file should be sent to the COWC for adjudication of his request for a waiver of recovery of an overpayment. 2. If the benefit sought on appeal remains denied, furnish the Veteran and his representative a Supplemental Statement of the Case (SSOC). An appropriate period of time should be allowed for response. MICHAEL LANE Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board T. Moore 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.