Citation Nr: 21025598 Decision Date: 04/28/21 Archive Date: 04/28/21 DOCKET NO. 09-08 820 DATE: April 28, 2021 ORDER An effective date of June 19, 2007, for the resumption of an award of compensation at the full rate following release from felony incarceration is granted, subject to special apportionment. FINDINGS OF FACT 1. The Veteran was incarcerated for a felony offense from May 1995 to June 1, 2007. 2. The Veteran provided Department of Veterans Affairs (VA) with notice of his release on June 19, 2007. 3. The proper date of last payment to the appellee is June 1, 2007. CONCLUSION OF LAW The criteria for an effective date of June 19, 2007, for the resumption of an award of compensation at the full rate, are met. 38 U.S.C. § 5313; 38 C.F.R. § 3.665. REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty from October 1976 to June 1977. This matter comes before the Board of Veterans’ Appeals (Board) on appeal from an April 2008 rating decision issued by a VA Regional Office (RO). The appellee in this case is the Veteran’s former spouse and, for the period in question, apportionee of the Veteran’s disability compensation benefits. In July 2012, the Board remanded the case for additional development and application of the contested claims procedures. The case now returns for further appellate review. The appellee is concurrently pursuing an appeal for additional apportionment benefits for a different time period which will be addressed under separate cover. Entitlement to an effective date prior to April 1, 2008, for the resumption of an award of compensation at the full rate. The Veteran contends that an effective date earlier than April 1, 2008, for the resumption of full compensation benefits is warranted. Specifically, he argues that he notified VA of his release from incarceration in June 2007, and thus his benefits should have resumed at the full rate from the date of release. After a review of the record, the Board agrees and finds a date of June 19, 2007, is proper for the resumption of full benefits, as the Veteran did not reunite with the appellee. When a recipient of VA benefits is incarcerated in a penal institution as a result of conviction of a felony, the amount of benefits payable will be no more than the rate for a 10 percent disability rating for the duration of the incarceration. 38 U.S.C. § 5313; 38 C.F.R. § 3.665. This reduction in benefits is to be effective on the 61st day of such confinement and is to remain in effect until the time of release. While the benefits paid to the Veteran or dependent are reduced, the rating is not affected, and full payments are to resume after release. If there was an apportionment award during incarceration, it shall be discontinued as of the date of last payment to the apportionee upon receipt of notice of release of the incarcerated person. Payment to the released person shall then be resumed at the full rate from date of last payment to the apportionee. Payment to the released person from date of release to date of last payment to the apportionee shall be made at the rate which is the difference between the released person’s full rate and the sum of (i) the rate that was payable to the apportionee and (ii) the rate payable during incarceration. 38 C.F.R. § 3.665(i)(1). If there was an apportionment granted during incarceration and the released person is not reunited with all dependents for whom an apportionment was granted, the released person’s award shall be resumed as stated in paragraph (i)(1) of this section except that when the released person’s award is resumed it shall not include any additional amount payable by reason of a dependent(s) not reunited with the released person. The award to this dependent(s) will then be reduced to the additional amount payable for the dependent(s). 38 C.F.R. § 3.665(i)(2). In the present case, the Veteran has been in receipt of a 100 percent disability rating since December 1990. He was incarcerated for a felony conviction from May 1995 to June 1, 2007. As a result, he was only entitled to receive compensation at the 10 percent rate beginning the 61st day of incarceration. 38 U.S.C. § 5313(a)(1); 38 C.F.R. § 3.665(a), (d)(1). On June 19, 2007, VA received a correspondence from the Veteran, including a notice from the Michigan Department of Corrections that the Veteran was discharged from incarceration on June 1, 2007. Consequently, the resumption of full compensation benefit is effective the date of date of last payment to the Veteran’s former spouse. See 38 C.F.R. § 3.665(i)(1). While the Veteran was incarcerated, the remainder of his benefits were apportioned to his former spouse. See January 1996 Notification Letter. In April 2007, the Veteran’s former spouse filed a claim for apportionment, indicating that she knew that he was soon to be released from incarceration and that she needed an apportionment of his award because she was disabled and could no longer work. Of note, VA compensation benefits, including apportioned awards, are paid the first day of the month following the month for which the benefit is paid. See 38 C.F.R. § 3.31 (2020). Thus, the date of payment of the award apportioned due to the Veteran’s incarceration was June 1, 2007. The Board concludes that the Veteran’s full rate payments should resume June 1, 2007. 38 C.F.R. § 3.665(i). The record, however, reflects that payment of full benefits to the Veteran did not begin until April 1, 2008. The file contains memoranda in which the RO staff expressed confusion over the correct process and whether the Veteran’s now-former spouse was entitled to a continuing apportionment beyond $142, the amount payable to a married Veteran with a disability rating in excess of 30 percent. The delay in resuming the Veteran’s payments may be attributable to the RO’s confusion over the standard procedure to modify running awards of compensation benefits which requires notice of the proposed adverse action, a 60-day period to respond, and an implementing decision with an additional implementation lead in period. 38 C.F.R. §§ 3.105, 3.500-503. The Board concludes this process is not applicable here. If this process was required, the effective date requirements of 38 C.F.R. § 3.665(i) could never be satisfied and the benefits could never be paid. Following the rule that the specific trumps the general, the Board concludes the RO erred in following the typical modification procedure. See VA Adjudication Manual M21-1 III.v.8.B.2.k (directing RO staff not to delay for notice of proposed adverse action to an apportionee when incarceration ends). The Veteran’s now-former spouse pursued an appeal for an increased special apportionment for the period following the Veteran’s release from prison, culminating in a July 2012 Board decision granting an award of 20 percent the Veteran’s disability compensation, but considered only the period from April 1, 2008. Neither party appealed that decision or filed for reconsideration or revision. 38 U.S.C. §§ 7103, 7111, 7252 (2020). Although the current decision awards the Veteran an earlier effective date of June 1, 2007, for resumption of his payments, that award remains subject to the claim for special apportionment filed by the appellee in April 2007. The Board lacks jurisdiction to consider the special apportionment for that time period as it is downstream of the matter considered here. The parties may pursue that matter before the RO when this decision is implemented. Additionally, payment to the released person from the date of release to date of last payment to the apportionee shall be made at the rate which is the difference between the released person’s full rate and the sum of (i) the rate that was payable to the apportionee and (ii) the rate payable during incarceration. 38 C.F.R. § 3.665(i)(1). The compensation and pension awards reflect that the amounts paid to the appellee and to the Veteran accounted for the full rate, as the appellee received the remainder of the Veteran’s entire award. Further, by grace of this decision, the Veteran is in receipt of his full benefit payment from the first month of his release from incarceration. Therefore, there is no difference in the full rate and the sum of the rate that was payable to the appellee and the rate payable during incarceration, and there was no period from the date of release to the date of last payment to the appellee wherein full benefits were not paid to the Veteran. Finally, the Board remanded this case in 2012 for compliance with the simultaneously contested claims procedures. The RO accomplished the necessary tasks and returned the case. Upon redocketing, the Board attempted to obtain briefs from the representatives from both parties. The Veteran’s representative did not file a brief as to the issue; however, as this decision is entirely favorable to the Veteran, there is no prejudice. The Board requested a brief from the appellee’s representative, but the representative filed a November 3, 2020, letter waiving the right to file a brief. Even assuming a due process error, the appellee has been aware that the Veteran’s release from incarceration would alter her benefits since April 2007, before the release occurred. The Veteran has not filed additional argument or evidence of which she is unaware. The outcome of this appeal is dictated by payment dates and the date of notice of the Veteran’s release from prison, which are not subject to reasonable dispute. The Board concludes that any due process error would be nonprejudicial. Sapp v. Wilkie, 32 Vet. App. 125, 144 (2019). In sum, the Board finds that the Veteran provided notice of release from incarceration on June 19, 2007, and the date of last payment to the appellee should have been May 2007. Consequently, the effective date for resumption of full benefit is correctly June 19, 2007. 38 C.F.R. § 3.665(i). Therefore, his claim for an (Continued on the next page)   earlier effective date for the resumption of full payment of compensation benefits granted, subject to the RO’s determination on special apportionment as discussed. J. B. FREEMAN Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board Jonathan M. Estes 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.