Citation Nr: 21028399 Decision Date: 05/11/21 Archive Date: 05/11/21 DOCKET NO. 17-53 634 DATE: May 11, 2021 ORDER The reduction in Department of Veterans Affairs (VA) compensation benefits for the purpose of recouping military drill pay for 53 days during Fiscal Year (FY) 2011 was proper; the appeal is denied. FINDING OF FACT The Veteran was in receipt of disability compensation benefits when he received drill pay for 53 drill days during FY 2011. CONCLUSION OF LAW The withholding of the Veteran's VA compensation benefits for 53 drill days for FY 2011 was proper. 38 U.S.C. § 5304; 38 C.F.R. §§ 3.654, 3.700. REASONS AND BASES FOR FINDING AND CONCLUSION The Veteran served on active duty from January 2004 to January 2007. In March 2020, the Veteran testified before a Veterans Law Judge (VLJ). A transcript of the hearing is of record. In March 2021, the Veteran was notified that the VLJ who conducted his hearing is no longer at the Board. He was given an opportunity to request a new hearing and informed that if he did not respond within 30 days the Board would assume that he did not want another hearing. The Veteran did not respond. Therefore, the Board will adjudicate the claim. In April 2020, the Board remanded the claim for further development. Validity of debt An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits to which he or she is not entitled. 38 U.S.C. § 5302; 38 C.F.R. § 1.962. When the validity of a debt is challenged, a threshold determination must be made on that question prior to a decision on waiver of indebtedness. Schaper v. Derwinski, 1 Vet. App. 430, 431 (1991); see also 38 C.F.R. § 1.911(c); VAOPGCPREC 6-98 (Apr. 24, 1998). To establish improper creation of an overpayment, i.e. an invalid debt, evidence must show that the claimant was legally entitled to the VA compensation benefits at issue, or, if he was not legally entitled to these benefits, then it must be shown that VA was solely at fault for the erroneous payment of excess benefits. As relevant to this appeal, 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 and inactive duty training payments made to Reservists and members of the National Guard. Id. Reservists may waive their pension, compensation, or retirement pay for periods of field training, instruction, other duty, or drills. A waiver may include prospective periods and contain a right of recoupment for the days for which the reservist did not receive payment for duty by reason of failure to report for duty. 38 C.F.R. § 3.700(a)(1)(iii). An administrative error resulting in an overpayment will not be classified as a VA administrative error or error in judgment if the error is "based on an act of commission or omission by the beneficiary, or with the beneficiary's knowledge." Dent, 27 Vet. App. at 380 (citing 38 U.S.C. § 5112 (b)(9); see 38 C.F.R. § 3.500(b)(1); VAOPGCPREC 2-90 (March 20, 1990)). Sole administrative error connotes that the claimant neither had knowledge of nor should have been aware of the erroneous award. Further, neither the claimant's actions nor his or her failure to act must have contributed to payment pursuant to the erroneous award. 38 U.S.C. § 5112(b)(9), (10); 38 C.F.R. § 3.500(b)(2); Jordan v. Brown, 10 Vet. App. 171 (1997) (sole administrative error is not present if the payee knew, or should have known, that the payments were erroneous). Thus, a finding of sole administrative error requires not only error on the part of VA, but that the beneficiary is unaware that the payments are erroneous. Analysis The Veteran disputes the propriety of the reduction of his VA disability compensation benefits to offset the concurrent receipt of active service drill pay during FY 2011. In September 2007, the Veteran was awarded compensation benefits for his disabilities. Attached to the Notification Letter was VA Form 21-8764 which informed the Veteran that receipt of active duty or drill pay as a reservist or member of the Federally recognized National Guard could affect his rights to compensation payments. In May 2009, May 2011, and August 2011, VA mailed the Veteran VA Form 21-8951, Notice of Waiver of VA Compensation or Pension to Receive Military Pay and Allowances. The forms notified the Veteran that, based on his social security number, the Defense Manpower Data Center (DMDC) had identified him as a reservist or guardsman who received training pay for 74 days during FY 2008, 59 days for FY 2009, and 52 days during FY 2010. The forms advised the Veteran that active or inactive duty training pay could not legally be paid concurrently with VA disability compensation. He was advised to sign and return the waivers; however, if he did not return the waivers, it would be assumed that he wished to waive VA compensation for the number of days printed on the front of the forms. The Veteran signed the form and acknowledged drilling 74 days in FY 2008, and in August 2009, VA reduced his benefits for 74 days for FY 2008. The Notification letter stated that VA would begin recouping the debt from September 1, 2009 through November 14, 2009. The Veteran also signed the form and acknowledged drilling 48 days for FY 2010. In August 2011, VA reduced the Veteran's benefits for 48 days for FY 2010. The Notification letter stated that VA would begin recouping the debt from September 1, 2011 through October 19, 2011. The Veteran did not return the form for FY 2009. In December 2011, VA reduced the Veteran's benefits for 59 drill pay days for FY 2009. The Notification letter stated that VA would begin recouping the debt from January 1, 2012 through February 29, 2012. The Board notes that the Veteran did not appeal these decisions. As such, they are not before the Board. In July 2015, VA informed the Veteran that it recently received information from the Defense Manpower Data Center indicating that the Veteran had received 53 days of military drill pay in FY 2011. An October 2015 Notification Letter finalized the decision and reduced the Veteran's VA compensation benefits. The reduction resulted in an overpayment. The Notification letter stated that VA would begin recouping the debt from November 1, 2015 through December 23, 2015. In his September 2015 Statement in Support of Claim and during his March 2020 Board hearing, the Veteran stated that VA had already recouped the overpayment debt in full. During his Board hearing, the Veteran stated for FY 2011, instead of forfeiting his drill pay, he opted for a prorated program. With this program, he was paid at a prorated rate throughout the FY, and the following spring, the prorated amount was taken from his VA pay. In his September 2015 statement, the Veteran stated that his normal compensation rate was $845.00 per month. However, in October 2011, he received no compensation benefits, $338.00 for November, regular benefits in December, and his payments were reduced in February and March 2012 to $29.00. The Veteran stated that based on these numbers, he believed that VA had already recouped the debt. In his February 2016 Statement in Support of Claim, the Veteran stated that VA was to deduct only $845.00 in November 2015. However, there was also a deduction taken in December. In April 2020, the Board acknowledged the Veteran's statements. Based on his contentions, the Board remanded the claim in order to conduct an audit of the Veteran's account for FY 2011. In October 2020, VA completed the audit. The audit report confirmed that VA collected the debt created for FY's 2008 debt from September 2009 through November 2009, FY 2009's debt was collected from September 2011 through October 2011, and FY 2010's debt was collected from January 2012 through February 2012. The audit noted that FY 2011's debt was collected in November ($845.00) and December 2015 ($647.63). Based on the evidence of record, the Board finds that the creation of the debt is valid. The Veteran's debt was created when he received monetary benefits, i.e., VA compensation benefits concurrently with military drill pay, to which he was not legally entitled. The law prohibits the receipt of VA disability compensation benefits for any period for which the person receives active service drill pay. See 38 C.F.R. §§ 3.654, 3.700. Additionally, the overpayment was not solely due to VA administrative error. Sole administrative error entails no knowledge or fault on the part of the debtor. See Jordan, 10 Vet. App. 171. In September 2007, the Veteran received VA Form 21-8764. The form noted that receipt of active duty or drill pay as a reservist or member of the Federally recognized National Guard could affect his rights to compensation payments. Additionally, from May 2009, the Veteran began receiving VA Form 21-8951 informing him that active or inactive duty training pay could not legally be paid concurrently with VA disability compensation. Therefore, the Board finds that the Veteran knew that he was not legally entitled to receive compensation benefits concurrently with military drill pay. As such, the Board finds that the Veteran's debt was not solely due to VA administrative error. The Board notes that in his September 2015 Statement in Support of Claim and during his March 2020 Board hearing, the Veteran stated that VA had already recouped the overpayment debt in full. However, the Board notes that VA did not receive information about the Veteran's FY 2011 drill days until 2015. Therefore, the debt collection could not have been completed in 2012. The Board also notes that the 2011 deduction was for 53 days, i.e., 30 days in November plus 23 days in December. As such, the Board finds that VA had not already recouped payment for FY 2011, and the recoupment in both November and December was proper. The Board finds that the debt created for FY 2011 is valid. The Board is bound by the law and is without authority to grant benefits on an equitable basis. See 38 U.S.C. §§ 503, 7104; Harvey v. Brown, 6 Vet. App. 416, 425 (1994). The application of the law to the facts in this case is dispositive. L. ANDERSEN Acting 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.