Citation Nr: 21028581 Decision Date: 05/11/21 Archive Date: 05/11/21 DOCKET NO. 14-34 106 DATE: May 11, 2021 ORDER An overpayment of transferred educational assistance benefits under 38 U.S.C. Chapter 33 (Post-9/11 GI Bill) in the amount of $28,246.09 for tuition and fees was properly created. Waiver of overpayment of transferred educational assistance benefits under 38 U.S.C. Chapter 33 (Post-9/11 GI Bill) in the amount of $28,246.09 for tuition and fees is denied. FINDINGS OF FACT 1. The Veteran did not complete his service contract. 2. The discontinuance of VA educational assistance benefits under the Post 9/11 GI Bill was proper; the overpayment of transferred educational assistance benefits under 38 U.S.C. Chapter 33 (Post-9/11 GI Bill) in the amount of $28,246.09 was validly created. 3. In January 2013, the Agency of Original Jurisdiction (AOJ) notified the appellant of the overpayment of transferred educational assistance benefits under 38 U.S.C. Chapter 33 (Post-9/11 GI Bill) in the amount of $28,246.09 and included her appeal rights; this was followed by notice to the appellant of the overpayment from VA's Debt Management Center in February 2013 with an enclosed document entitled, Notice of Rights and Obligations. 4. The Veteran submitted a request for waiver of overpayment in February 2014, which was outside of the 180-day window required to request a waiver of the debt. CONCLUSIONS OF LAW 1. The debt created by the overpayment of transferred VA educational assistance benefits under the Post 9/11 GI Bill, Chapter 33, through the Transfer of entitlement (TOE) program in the amount of $28.246.09 for tuition and fees is valid. 38 U.S.C. §§ 3301, 3311, 3313, 3319; 38 C.F.R. §§ 21.9550, 21.9570, 21.9695. 2. The request for a waiver of indebtedness resulting from an overpayment of transferred Post-9/11 GI Bill educational assistance benefits through the TOE program in the amount of $28,246.09 for tuition and fees was not timely filed. 38 U.S.C. § 5302; 38 C.F.R. § 1.963. REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran served on active duty from January 2001 to January 2005 and May 2007 to November 2012. The appellant is the Veteran's former spouse. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a February 2014 decision by the Committee on Waivers and Compromises (Committee) of the Department of Veterans Affairs (VA) Debt Management Center. In October 2015, the appellant testified at a hearing held at the Regional Office before the undersigned Veterans Law Judge. A transcript of the hearing has been associated with the claims file. This matter was previously before the Board in December 2017 and May 2020 at which times the case was remanded for additional development. The matter is once again before the Board. Validity of Debt The issue of whether the underlying debt is valid is a threshold determination that must be made prior to a decision on a request for waiver of the indebtedness. See Schaper v. Derwinski, 1 Vet. App. 430 (1991). It can be made separate from or part of a waiver request. Id. In this appeal, VA construed the appellant's waiver request as including a disagreement as to the validity of the debt. For a determination that the overpayment was not properly created, such that the debt was not valid, it must be established that the claimant was either legally entitled to the benefits in question or, if the claimant was not legally entitled, then it must be shown that VA was solely responsible for the claimant being erroneously paid benefits. Administrative errors include all administrative decisions of entitlement, whether based upon mistake of fact, misunderstanding of controlling regulations or instructions, or misapplication of law. VAOPGPREC 2-90 (July 17, 1989), 55 Fed. Reg. 27757 (1990). Education benefits under the Post-9/11 GI Bill (Chapter 33) were established for "individuals who served on active duty after September 10, 2001" and were made effective August 1, 2009. 38 C.F.R. § 21.9500. The provisions of the Act are codified at 38 U.S.C.A. §§ 3301-3327 with the implementing regulations found at 38 C.F.R. §§ 21.9500-21.9770. In specific regard to the liability of overpayments of Chapter 33 educational assistance benefits, the overpayment becomes a liability to the individual that was paid the benefits unless the liability was waived as provided in sections 1.957 and 1.962 of the chapter, or the overpayment results from an administrative error or an error in judgment. 38 C.F.R. § 21.9695. The Chapter 33 provisions that pertain to the authority to transfer unused education benefits to family members under the TOE program are found in 38 U.S.C. § 3319. An eligible individual is any member of the uniformed services who, at the time of the approval of the individual's request to transfer entitlement to educational assistance under this section, has completed at least (1) six years of service in the armed forces and enters into an agreement to serve at least four more years as a member of the uniformed services; or (2) the years of service as determined in regulations pursuant to subsection (j). 38 U.S.C. § 3319(b). The provisions under 38 C.F.R. § 21.9570(l) pertain to when a transferor fails to complete the required service contract that afforded participation in the transferability program. In this regard, dependents are not eligible for transferred entitlement if the transferor fails to complete the amount of service he or she agrees to serve in the Armed forces in the TOE program and VA will treat all payments of educational assistance to dependents as overpayments if the transferor does not complete the required service, unless- (i) The transferor did not complete the service due to: (A) His or her death; (B) A medical condition that preexisted such service on active duty and that the Secretary of the military department concerned determines is not service-connected; (C) A hardship, as determined by the Secretary of the military concerned; or (D) A physical or mental condition that was not characterized as a disability and did not result from the individual's own willful misconduct but interfered with the individual's performance of duty, as determined by the Secretary of the military department concerned; or (ii) The transferor is considered to have completed his or her service agreement as a result of being discharged for- (A) A disability; or (B) A reduction in force. See also 38 U.S.C. §§ 3319(i), 3311(c)(4). In addition, the statute provides that in the event of an overpayment of TOE benefits, the dependent and the individual making the transfer of benefits shall be jointly and severally liable to the United States for the amount of the overpayment for purposes of section 3685. 38 U.S.C. § 3319 (i). "Joint and several liability" is a legal phrase which means that both parties are independently liable for the full amount of the debt. In the instant case, in applying to transfer his Chapter 33 benefits, the Veteran agreed to serve until August 1, 2013 which is the date of his eligibility under the TOE program pursuant to 38 U.S.C. § 3319(b). This date is reflected in information obtained from the Veterans Information Solution (VIS) system in July 2007. VIS is a web-based application that provides VA with access to information from the Defense Enrollment Eligibility Registration System. In August 2009, the appellant applied for Chapter 33 benefits through the TOE program and in October 2009, she was approved for 14 months of full-time benefits. She was informed in the October 2009 letter, as well as a subsequent award letter in December 2009, that VA cannot pay benefits for changes in active duty status. Thereafter, in December 2012, VA obtained information from VADIR (Veterans Affairs and Department of Defense Identity Repository) which shows that the Veteran he did not meet the eligibility requirements for the TOE program due to his service discharge in November 2012 under other than honorable conditions. This information is consistent with his separation record (DD Form 214) for his second period of active duty which shows that the narrative reason for separation was in lieu of trial by Court Martial and that the character of discharge was under other than honorable conditions. By letter dated in January 2013, the AOJ informed the appellant that because her transferor (the Veteran) did not fulfill the obligation he incurred in order to transfer benefits to her, she was not entitled to payment for the terms at Drexel University that began on June 22, 2009 and ended on January 13, 2011. A decision as to transferability of Chapter 33 benefits rests with the service department, not VA. See 38 U.S.C. § 3319 and 38 C.F.R. § 21.9570. With that said, the appellant does not dispute the character or date of the Veteran's discharge or the finding that he did not meet the service requirements for the TOE program. Rather, she asserts that the Veteran had served honorably prior to his discharge and she had no knowledge of or control over his behavior that led to his early discharge from service. The appellant's argument for invalidating the debt is essentially on an equitable basis which the Board sympathizes with. However, the Board cannot grant the benefit sought on an equitable basis, as "no equities, no matter how compelling, can create a right to payment out of the United States Treasury which has not been provided for by Congress." Smith (Edward F.) v. Derwinski, 2 Vet. App. 429, 433 (1992). Here, the facts clearly show that the exceptions under 38 C.F.R. § 21.9570(l) for finding the appellant eligible for Chapter 33 benefits under the TOE program when a transferor has not completed his or her required service have not been met. As such, the Veteran was ineligible to transfer his Chapter 33 benefits to the appellant under this program. The appellant, in turn, is not legally entitled to the Chapter 33 benefits that she received. In consideration of this and the fact that the overpayment is not due to VA error, the Board finds that the payment of Chapter 33 benefits to the appellant under the TOE program for her enrollment at Drexel University in the calculated amount of $28, 246.09 in tuition and fees is a valid debt. Waiver of Debt The Board notes that there has been some confusion regarding the waiver issue due to an incomplete record. In this regard, prior to April 2021, the electronic file before the Board was incomplete because it did not contain the appellant's education file, only the Veteran's education file. This resulted in missing records that necessitated additional development to obtain the records, including the appellant's waiver request. With that said, it must be emphasized that a remand is a preliminary order and does not constitute a final decision of the Board. 38 C.F.R. § 20.100(b). Thus, any discussion or directives by the Board with respect to the waiver issue does not constitute a binding decision on the matter. Id. The threshold question in any claim concerning a request for a waiver of overpayment is whether the waiver request was timely filed. Under the applicable criteria, a request for waiver of indebtedness shall only be considered if it is made within 180 days from the date of notification of the indebtedness that is issued by VA to the debtor. See 38 U.S.C. § 5302 (a); 38 C.F.R. § 1.963 (b). The 180-day period may be extended if the individual requesting waiver demonstrates that, as a result 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). See 38 C.F.R. § 1.963 (b)(2). In this case, as noted, VA provided notice to the appellant at her latest address of record in January 2013 of the overpayment in the amount of $28, 246.09. Enclosed with this letter was a copy of the appellant's appeal rights. This letter also informed the appellant that she would be receiving notice from the VA's DMC regarding the debt and paying it back. In February 2013, the DMC informed the appellant of the overpayment of educational assistance in the calculated amount of $28,246.09 and provided instructions for paying it back. The DMC also informed the appellant that a document was enclosed entitled, Notice of Rights and Obligations, and that she should read it carefully. See VA Form 0748. This document informed the appellant she had the right to dispute the existence or amount of the debt and that she had 180 days from the date of the notice letter to request a waiver of the debt. The 180-day requirement for filing the waiver request was highlighted in bold. In February 2014, approximately one year after the February 2013 DMC notice letter, VA received a "To Whom It May Concern" from the appellant dated in February2014 requesting waiver of her debt of Chapter 33 educational assistance benefits. The appellant has neither asserted nor is there any evidence indicating that there was a delay in her receiving notice of the overpayment from the DMC. 38 C.F.R. § 1.963 (b)(2). Accordingly, the Board finds that the request for a waiver of indebtedness resulting from an overpayment of Post-9/11 GI Bill educational assistance benefits through the TOE program in the amount of $23,246.09 for tuition and fees for the appellant's enrollment at Drexel University was not timely filed. As the law is dispositive in this case, the claim must be denied based on a lack of legal entitlement under the law. See Sabonis v. Brown, 6 Vet. App. 426 (1994). M. E. Larkin Veterans Law Judge Board of Veterans' Appeals Attorney for the Board Shawkey, Anne M. 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.