Citation Nr: 21040245 Decision Date: 07/02/21 Archive Date: 07/02/21 DOCKET NO. 16-12 392 DATE: July 2, 2021 REMANDED Entitlement to service connection for panic disorder with agoraphobia (on a direct basis only) is remanded. Entitlement to an initial rating in excess of 40 percent for panic disorder with agoraphobia (service connection granted on a secondary basis) is remanded. Entitlement to a total disability rating based on individual unemployability (TDIU) is remanded. REASONS FOR REMAND The Veteran served on active duty in the United States Marine Corps from January 1978 to March 1982. The Veteran filed his initial claim requesting service connection for panic attacks on February 17, 2012. In the May 2013 VA rating decision, service connection for an acquired psychiatric disorder (claimed as panic attacks, anxiety, and depression) was denied by the agency of original jurisdiction (AOJ) on a secondary basis to his service-connected tinnitus and on a direct basis. See 38 U.S.C. § 1110; 38 C.F.R. §§ 3.303, 3.310. Within one year, the Veteran filed a timely notice of disagreement (NOD) in July 2013 expressing disagreement with service connection and the evaluation of disability (inapplicable because no evaluation was assigned). In the January 2015 VA rating decision, the AOJ granted service connection for panic disorder with agoraphobia because the disability was permanently worsened as a result of his service-connected tinnitus. See 38 C.F.R. § 3.310(b). The AOJ assigned a 20 percent disability rating (after the pre-aggravation rate of 30 percent was subtracted from the 50 percent current level of disability) for the entire appeal period effective from February 17, 2012. See 38 C.F.R. § 4.130, Diagnostic Code 9412. The Veteran was notified of the January 2015 VA rating decision in February 2015 and, within one year, he obtained his current representative on file (attorney) and submitted a timely NOD in December 2015. The AOJ issued a statement of the case (SOC) in March 2016 for the issue of entitlement to an initial rating in excess of 20 percent for panic disorder with agoraphobia, the Veteran submitted a timely substantive appeal (VA Form 9) in March 2016 disagreeing only with the evaluation of disability. The issue was timely perfected on appeal and certified to the Board in July 2017 (VA Form 8). In November 2018, the Board increased the disability rating for service-connected panic disorder with agoraphobia to 40 percent (after the pre-aggravation rate of 30 percent was subtracted from the 70 percent current level of disability) for the appeal period from February 17, 2012 to April 30, 2014 (prior to May 1, 2014) and denied an initial rating in excess of 40 percent thereafter, as well as denied entitlement to a TDIU. See 38 C.F.R. § 4.130, Diagnostic Code 9412. The Veteran appealed the November 2018 Board decision to the United States Court of Appeals for Veterans Claims (Court). Counsel for the Veteran and the Secretary of VA (the parties) filed a partial Joint Motion for Remand (JMR). An Order of the Court dated April 10, 2020 granted the motion and remanded the case to the Board. 1. Entitlement to service connection for panic disorder with agoraphobia (on a direct basis only) As previously noted, the AOJ denied the issue of service connection for acquired psychiatric disorder (claimed as panic attacks, anxiety, and depression) on direct and secondary bases in the May 2013 VA rating decision. See 38 U.S.C. § 1110; 38 C.F.R. §§ 3.303, 3.310. In response to the Veteran's timely NOD in July 2013, the AOJ granted the issue of service connection for panic disorder with agoraphobia on a secondary basis for aggravation in the January 2015 VA rating decision. See 38 C.F.R. § 3.310(b). The Veteran was notified of the January 2015 VA rating decision in February 2015 and, within one year, he obtained his current representative on file (attorney) and submitted a timely NOD in December 2015 expressing disagreement with only the evaluation of disability. In a written brief submitted with the NOD, the Veteran's attorney also noted the Veteran's "desire to appeal this case to the Board [and] [t]he Veteran is continuing to seek a rating in excess of 20 percent for his service-connected panic disorder with agoraphobia." In March 2016, the Veteran submitted a VA Form 21-8940 initially raising explicit disagreement with whether the AOJ should have granted service connection for panic disorder with agoraphobia on a direct basis. See 38 U.S.C. § 1110; 38 C.F.R. § 3.303. Specifically, the Veteran stated he had experienced panic attacks in service. In a December 2016 written brief, the Veteran's attorney reiterated the Veteran's challenge to the basis for the grant of service connection for panic disorder with agoraphobia, specifically noting the Veteran's report that his panic attacks started at the same time during service. In a February 2021, the Veteran's attorney submitted a January 2021 private vocational assessment and asserted the following in a written brief: the AOJ erroneously limited the Veteran's claim in 2015 to one based on aggravation due to the VA medical opinion provided in the January 2015 VA examination report and failed to appreciate that the Veteran's psychiatric disorder and tinnitus had the same root in-service cause and that the Veteran had provided credible lay testimony indicating that he had been experiencing both panic attacks and tinnitus since service. In April 2021, a VA notification letter was sent to the Veteran and his attorney informing them that by the AOJ granting service connection on a secondary basis under 38 C.F.R. § 3.310(b), the AOJ implicitly denied service connection for the issue on a direct basis and the record was silent for any challenge to the implicit denial within a year after the February 2015 notice letter. In fact, the Veteran and his attorney had the opportunity to explicitly challenge the basis for the grant of service connection for panic disorder with agoraphobia in the December 2015 NOD, March 2106 VA Form 9, or in any other written correspondence, but did not until the March 2016 VA Form 21-8940. As a result, the Board does not have jurisdictional authority to address the matter. The Veteran and his attorney were notified of this potential jurisdictional defect under 38 C.F.R. § 20.104(c) and provided the opportunity to respond. In a June 2021 written brief, the Veteran's attorney responded, in part, that the Veteran's July 2013 NOD and August 2013 letter requesting a Decision Review Officer (DRO) hearing encompassed his original allegation that his panic attacks manifested during service alongside his tinnitus. While the AOJ issued a rating decision in 2015 granting service connection on a secondary basis for aggravation, the AOJ has not issued a SOC as of this date regarding service connection on a direct basis and on a secondary basis for causation. The Board makes clear that it is not taking a stance as to whether the Veteran and his attorney's approach to challenging the basis for the grant of service connection for panic disorder with agoraphobia is correct in this case or in all other cases. However, under the specific facts of this case and affording the Veteran the benefit of the doubt, the Board remands the issue of entitlement to service connection for panic disorder with agoraphobia (on a direct basis only) for issuance of a SOC by the AOJ. Manlincon v. West, 12 Vet. App. 238, 240-241 (1999). 2. Entitlement to an initial rating in excess of 40 percent for panic disorder with agoraphobia (service connection granted on a secondary basis) 3. Entitlement to a TDIU While the Board remands the issue of entitlement to service connection for panic disorder with agoraphobia (on a direct basis only) for issuance of a SOC, as discussed above, that decision may impact these claims for an initial rating in excess of 40 percent for panic disorder with agoraphobia (service connection granted on a secondary basis) and a TDIU. As such, these issues are inextricably intertwined. See Harris v. Derwinski, 1 Vet. App. 180, 183 (1991). The matters are REMANDED for the following actions: 1. Issue a SOC addressing the issue of entitlement to service connection for panic disorder with agoraphobia (on a direct basis only). A timely perfected appeal must be filed to vest the Board with appellate jurisdiction over the claim. Otherwise the appeal may be closed by the AOJ. 2. Then, readjudicate the claims. If any decision is adverse to the Veteran, issue a Supplemental Statement of the Case and allow the applicable time for response. Then, return the case to the Board. D. Martz Ames Veterans Law Judge Board of Veterans' Appeals Attorney for the Board T. Carter, 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.