Citation Nr: 21025752 Decision Date: 04/28/21 Archive Date: 04/28/21 DOCKET NO. 16-41 934 DATE: April 28, 2021 ORDER The termination of Department of Veterans Affairs (VA) compensation benefits during the Veteran’s period of active duty beginning May 22, 2013 was proper; the appeal is denied. The request for waiver of recovery of overpayment of VA benefits in the amount of $18,960.48 was not timely filed; the appeal is denied. FINDINGS OF FACT 1. The Veteran has received a compensable service-connected benefits rating since February 28, 2011. 2. The Veteran was on active duty from May 22, 2013 until June 30, 2015. 3. The Veteran received both active duty pay and VA compensation for the period between May 2013 and December 2014. 4. The Regional Office (RO) retroactively terminated the Veteran’s VA compensation benefits during the Veteran’s period of active duty between May 2013 and December 2014; this action resulted in an overpayment in the amount of $18,960.48. 5. In a January 1, 2015 letter, the Veteran was notified that she owed a debt of $18,960.48; the letter stated that the Veteran could request a waiver of the recovery of the debt within 180 days. 6. In a statement received August 27, 2015, the Veteran requested a waiver of the recovery of the debt. 7. There was no delay in the Veteran’s receipt of the notification of indebtedness as a result of VA or postal authority error, or due to other circumstances beyond the Veteran’s control. CONCLUSIONS OF LAW 1. The termination of VA compensation benefits during the Veteran’s period of active duty between May 2013 and December 2014 was proper. 38 U.S.C. § 5304(c); 38 C.F.R. §§ 3.654, 3.700. 2. The Veteran did not file a timely request for a waiver of recovery of overpayment of VA benefits in the amount of $18,960.48. 38 U.S.C. § 5302(a); 38 C.F.R. § 1.963(b)(2). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran served on active duty from September 2004 to November 2005, from March 2007 to February 2011, from May 2013 to June 2015, and from November 2015 to September 2016. This matter is on appeal before the Board of Veterans Appeals (Board) from a December 2014 decision letter from the VA Regional Office (RO), which notified the Veteran that her benefits would be stopped effective May 22, 2013 due to her return to active duty, and the November 2015 Decision on Waiver of Indebtedness by the VA Committee on Waivers and Compromises (COWC). The Veteran has suggested the debt is invalid due to VA’s delay in processing her return to active duty, and is also requesting a waiver due to the hardship created by repayment of the debt. The Board recognizes the Veteran’s request for a hearing in this case, which was indicated on her August 2016 VA Form 9. However, in June 2019, the Veteran sent a statement to the Board indicating her wish to cancel the hearing, indicating, “I no longer have this debt.” As it was unclear whether the debt was deemed invalid by VA or whether the Veteran paid the debt, the Board sought clarification. In April 2021, a memorandum was added to the claims file from VA’s Support Services Division Finance, which confirmed that the Veteran’s debt balance is $0.00 because the debt was paid off via collection from VA’s Debt Management Center (DMC) from the Veteran’s VA benefits, and cash transfers made by the Veteran to the DMC. Thus, the matters related to the validity of the debt and the waiver request remain before the Board. Validity The Veteran has had several periods of active duty. Pertinent to this appeal, she served on active duty from May 22, 2013 until June 30, 2015. She was receiving active duty pay and VA compensation benefits during a portion of this active duty period. A review of the record reveals that the Veteran notified VA of her pending reactivation early in May 2013. She again called VA in February 2014 to report her active duty status as she was concerned that the RO had not processed her request to stop her benefits. The record shows she again called VA in September 2014 because it had been over twelve months and she was still receiving payments. It was not until December 2014 that VA communicated with the Veteran to indicate her benefits were being stopped as of May 22, 2013. An internal memo in the claims file shows the Veteran’s benefits were stopped in December 2014 and a retroactive debt in the amount of $18,960.48 was created due to the overpayment. In August 2015, the Veteran submitted a statement indicating this debt should not have to be paid due to its creation being the fault of VA’s delay in processing her report of returning to active duty. 38 U.S.C. § 5304(c) prohibits the receipt of VA disability compensation benefits for any period for which the person receives active service pay. See 38 C.F.R. §§ 3.654, 3.700. This includes active duty pay, drill, and active duty for training payments, and inactive duty training payments made to Reservists and members of the National Guard. Reservists may waive their pension, compensation, or retirement pay for periods of field training, instruction, other duty, or drills. In this case, the Veteran does not argue that the debt at issue is invalid due to her not being on active duty for the time period assessed; rather she argues that the debt is invalid because VA failed to process the change in a timely manner. The Board has, therefore, considered whether there was sole administrative error in the payment of VA compensation benefits during the Veteran’s period of active duty between May 2013 and December 2014 due to VA’s processing delay. Under 38 U.S.C. § 5112(b)(10), the effective date of a reduction or discontinuance of compensation by reason of an erroneous award based solely on administrative error or error in judgment shall be the date of last payment. See also 38 C.F.R. § 3.500(b)(2). “Stated another way, when an overpayment has been made by reason of an erroneous award based solely on administrative error, the reduction of that award cannot be made retroactive to form an overpayment debt owed to VA from the recipient of the erroneous award.” Erickson v. West, 13 Vet. App. 495, 499 (2000). The Board notes, however, that sole administrative error may be found to occur only in cases where the appellant neither had knowledge of nor should have been aware of the erroneous award. Further, such error contemplates that neither the appellant’s actions nor his or her failure to act contributed to the erroneous award. 38 U.S.C. § 5112(b)(10); 38 C.F.R. § 3.500(b)(2). In this case, the Veteran called VA several times to ask the RO to stop her benefits due to her active duty status; thus, it is clear she knew she was receiving an erroneous award. She argues that she should not be penalized for VA’s administrative delay in processing the change. The Board recognizes that VA undoubtedly delayed in making the change. However, VA policy dictates that payment of benefits in an amount exceeding a beneficiary’s entitlement that is due to claims-processing delay is not considered administrative error. Thus, because the retroactive reduction of benefits was made in accordance with VA law and regulation, the creation of the debt occurred with the Veteran’s knowledge of erroneous payments, and VA’s delay in processing the change cannot be deemed administrative error, the creation of the $18,960.48 debt in this case was not the result of sole administrative error on the part of VA. Accordingly, the $18,960.48 debt is valid. This appeal is denied Waiver Under applicable criteria, a request for waiver of an indebtedness shall only be considered if made within 180 days following the date of a notice of indebtedness to the debtor. The 180-day period may be extended if the individual requesting waiver demonstrates, as a result of 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. 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. 38 U.S.C. § 5302 (a); 38 C.F.R. § 1.963 (b)(2). In December 2014, the RO informed the Veteran that a debt was being created following a retroactive termination of her VA compensation benefits effective May 22, 2013 due to her return to active duty. In a letter mailed on January 1, 2015, the Veteran was notified by the DMC that she owed a debt of $18,960.48. The letter stated that the Veteran could request a waiver of the recovery of the debt in certain circumstances. She was informed that she had 180 days to request a waiver of the recovery of this debt. 180 days from January 1, 2015 was June 30, 2015. The Veteran requested a waiver of the recovery of the debt by way of a statement sent to VA on August 27, 2015, nearly two months past the filing deadline. The Veteran’s request was denied as it was not received with 180 days of the notification letter. With her notice of disagreement (NOD), the Veteran submitted a statement indicating that at the time the DMC letter was received, she was moving out of her home due to being in the process of a divorce. She indicated that her husband was not retaining her mail at the time. On her NOD form, she reported that her former husband gave her the mail in mid-August 2015. She also argued that collecting this debt would create a financial hardship. In January 2016, she again reported that her ex-husband did not give her the mail and that her delay in requesting a waiver was due to this situation, which was out of her control. She submitted several documents at this time showing the divorce was contentious and difficult. In fact, a copy of a Joint Inspector General Action Request form completed by her husband in January 2015 shows the Veteran reporting that they were living separately at that time, which corroborates the Veteran’s suggestion that she had moved out at the time the DMC letter was sent. The Board, therefore, finds the Veteran’s report of moving out and, therefore, not receiving the DMC letter to be credible. However, if the Veteran had moved, it was her duty to notify VA of an updated address for mailing. There is no evidence that this was done in this case. Moreover, the Veteran has not suggested she did not receive the December 2014 letter notifying her that her benefits would be stopped and that an overpayment was created, which she would receive information about in a separate letter. She, therefore, should have reasonably expected VA to be contacting her; yet, she did not provide VA with an updated address. Thus, while the Board recognizes the difficulty the Veteran was experiencing at the time, it appears the Veteran moved, knew she was not receiving mail, knew a letter was coming with overpayment debt information, but did not provide VA with an updated mailing address. The Board, therefore, finds that the non-receipt of the DMC letter was not due to a situation outside of her control. Because there is no evidence in the record establishing that there was a delay in the Veteran’s receipt of the notification of indebtedness a result of an error by either VA or the postal authorities, or due to other circumstances beyond the Veteran’s control, the Board concludes that the Veteran did not timely request a waiver of recovery of an overpayment of VA benefits. This appeal is, therefore, denied. (Continued on the next page)   The arguments the Veteran has made for entitlement to a waiver, including due to hardship, cannot be considered, as the waiver matter is not being considered on the merits. MICHAEL E. KILCOYNE Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board A. Adamson, 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.