Citation Nr: A21016008 Decision Date: 09/27/21 Archive Date: 09/27/21 DOCKET NO. 210802-176199 DATE: September 27, 2021 ORDER The overpayment in the calculated amount of $7,114.62 as a result of the removal of the Veteran's former spouse as a dependent effective January 1, 2007, and the addition of his current spouse as a dependent with payment effective September 1, 2019, was properly created, and the appeal is denied. FINDINGS OF FACT 1. In November 1987, the Veteran was informed he was receiving additional benefits relating to his service-connected disabilities for his spouse R.C. and that any change in the number or status of his dependents would need to be promptly reported to the Department of Veterans Affairs (VA). 2. In April 2020, VA notified the Veteran that his claim for additional compensation, to include service connection for diabetes, was granted and he was assigned at least a 30 percent disability rating effective August 23, 2019. 3. The claims file does not include any written statement from the Veteran informing VA of his current spouse or the death of R.C. until March 9, 2021. 4. In March 2021, the Veteran was notified that payment of additional dependency compensation for R.C. as a dependent spouse would cease beginning January 1, 2007, and that M.A.V. was added to his award as his current dependent spouse with payment effective September 1, 2019. CONCLUSION OF LAW The overpayment of VA compensation benefits based on the removal of R.C. from the Veteran's award as a current spouse and the addition of M.A.V. as his current spouse was properly created. 38 U.S.C. §§ 1115, 1135, 1506, 5112; 38 C.F.R. §§ 3.103(b)(3), 3.401, 3.500, 3.501(d)(2). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served honorably on active duty in the United States Navy from April 1967 to May 1987. This matter comes before the Board of Veterans' Appeals (Board) from a March 2021 decision issued by a VA Regional Office that removed R.C. from the Veteran's award as a dependent spouse effective January 1, 2007, and added M.A.V. to his award as a dependent spouse effective September 1, 2019. As the rating decision on appeal was issued in March 2021 and constitutes an initial decision, the modernized review system, also known as the Appeals Modernization Act (AMA), applies. In the August 2021 VA Form 10182, Decision Review Request: Board Appeal, the Veteran elected the Direct Review docket. Therefore, the Board may only consider the evidence of record at the time of the agency of original jurisdiction decision on appeal. 38 C.F.R. § 20.301. Evidence was added to the claims file during a period of time when new evidence was not allowed, which the Board may not consider this evidence in its decision. 38 C.F.R. § 20.300. The Veteran may file a Supplemental Claim and submit or identify this evidence. 38 C.F.R. § 3.2501. If the evidence is new and relevant, VA will issue another decision on the claim, considering the new evidence in addition to the evidence previously considered. Id. Specific instructions for filing a Supplemental Claim are included with this decision. It appears from the Veteran's appeal to the Board that he also wishes to obtain a waiver of the indebtedness caused by the March 2021 decision. The Board's review of the claims file has not uncovered a demand letter for this overpayment. If the Veteran has not yet received such a letter, he is free to request a waiver of the amount of the debt owed to VA in accordance with the rights explained to him in that demand letter. Whether an Overpayment was Properly Created An overpayment is created when VA determines that a beneficiary or payee has received benefit payments in excess of the amount due or to which such beneficiary or payee is entitled. 38 C.F.R. § 1.962. The debtor may challenge the validity or amount of the debt owed. 38 C.F.R. § 1.911 (c)(1); see also Schaper v. Derwinski, 1 Vet. App. 430, 437 (1991); VAOPGCPREC 6-98. The debtor may also apply for a waiver of any debt found to be valid. 38 U.S.C. § 5302; 38 C.F.R. §§ 1.911(c)(2), 1.963. Here, only the validity of the debt is at issue in this appeal. The law provides for the rates of disability compensation, and for payment of additional compensation for dependents of veterans who have a disability rated at least 30 percent disabling. 38 U.S.C. §§ 1114(c), 1115, 1134, 1135. The Veteran was, at all times relevant to this issue and the period of time in question, eligible to receive additional compensation for a spouse. In order for the Board to determine that the overpayment was not properly created, such that the resulting debt is not valid, it must be established that the Veteran was legally entitled to the benefits in question or, if the Veteran was not legally entitled, then it must be shown that VA was solely responsible for the Veteran being erroneously paid benefits. 38 U.S.C. § 5112(b)(9), (10); 38 C.F.R. § 3.500(b)(2); Jordan v. Brown, 10 Vet. App. 171 (1997); VAOPGREC 2-90 (March 20, 1990)). The Board begins its analysis with determining whether the Veteran was legally entitled to the additional dependency compensation for a spouse that was awarded to him and is the basis for the overpayment created. In his arguments and contentions submitted since the appeal to the Board, the Veteran does not necessarily contend that he was entitled to additional dependency compensation between the period his former spouse R.C. died in December 2006 and the date that he has currently been awarded additional dependency compensation for his current wife in September 2019. However, he appears to have suggested in a July 2021 statement that he should be awarded dependency compensation for his current spouse dating back to August 2013. With respect to the Veteran's receipt of additional compensation for R.C., the Board finds that VA has properly determined that he was not entitled to additional dependency compensation for this spouse beginning January 1, 2007. Here, the record reflects that R.C. died on December [REDACTED], 2016. As this occurred after October 1, 1982, the last date of entitlement to additional dependency compensation for her was the last day of the month in which the death occurred (i.e., December 31, 2006). See 38 C.F.R. § 3.500(g)(2)(ii). Beginning the next day (i.e., January 1, 2007), he was no longer entitled to any additional dependency compensation for this spouse. The Board next must determine whether he is entitled to additional dependency compensation for his current spouse prior to the currently set effective date of compensation of September 1, 2019. When determining the effective date for an award of additional compensation for dependents, the effective date will be the last of the following dates provided that sufficient evidence is received: (1) the date of claim; (2) the date the dependency arises; (3) the effective date of the qualifying disability rating; or (4) the date of commencement of the veteran's award. 38 C.F.R. § 3.401(b). The "date of claim" for additional compensation for a spouse is the date of marriage, if evidence of the event is received within a year of the event; otherwise, the date notice is received of the dependent's existence, if evidence is received within a year of a request from VA. 38 U.S.C. § 5110; 38 C.F.R. § 3.401. Under 38 U.S.C. § 5101(a), a specific claim must be filed in order for benefits to be paid or furnished to any individual under the laws administered by VA. See also 38 C.F.R. § 3.151(a). The Secretary has authority to prescribe the nature and extent of the proof required in order to establish a right to VA benefits. See 38 U.S.C. § 501. If a claimant's application for a benefit under the laws administered by the Secretary is incomplete, the Secretary shall notify the claimant and the claimant's representative, if any, of the information necessary to complete the application. 38 U.S.C. § 5102(b). If information that a claimant and the claimant's representative, if any, are notified under subsection (b) is necessary to complete an application is not received by the Secretary within one year from the date such notice is sent, no benefit may be paid or furnished by reason of the claimant's application. 38 U.S.C. § 5102 (c). Except as otherwise provided by law, a claimant has the responsibility to present and support a claim for benefits under laws administered by the Secretary. 38 U.S.C. § 5107(a). VA will accept, for purposes of determining entitlement to benefits under laws administered by VA, the statement of a claimant as proof of marriage, dissolution of a marriage, birth of a child, or death of a dependent, provided that the statement contains: the date (month and year) and place of the event; the full name and relationship of the other person to the claimant; and the social security number of the other person. 38 U.S.C. § 5124; 38 C.F.R. § 3.204. Regardless of the regulation governing effective dates of awards, payment of monetary benefits based on compensation begins the first day of the month following the effective date. 38 C.F.R. § 3.31. Although VA's regulations now require the use of a standardized claims form prescribed by the secretary, prior to March 24, 2015, VA accepted both formal and informal claims. An informal claim was any communication or action indicating an intent to apply for one or more benefits. 38 C.F.R. § 3.155. While there was no set form that an informal claim must have taken, the regulations required that such a claim be in writing. 38 C.F.R. § 3.1(p). All that was required is that the written communication indicates an intent to apply for one or more benefits under the laws administered by VA, and identify the benefits sought. Rodriguez v. West, 189 F.3d 1351 (Fed. Cir. 1999). Here, the record does not include any evidence that the Veteran submitted a written claim for additional dependency compensation for his current spouse prior to the March 2021 submission of VA Form 21-686c (Declaration of Status of Dependents). The Veteran also does not argue that he submitted a written claim for dependency compensation for his current spouse prior to that March 2021 form. As it was received more than a year after his March 2012 marriage to his current spouse, the receipt of that claim form in March 2021 would ordinarily be the earliest possible date that VA could add her to his award as a dependent spouse. However, the United States Court of Appeals for Veterans Claims (Court) has made clear that the effective date for additional compensation for dependents shall be the same as the effective date of the rating decision giving rise to such entitlement if evidence of the dependency is received within a year of that decision. Sharp v. Shinseki, 23 Vet. App. 267, 276 (2009); see also 38 C.F.R. § 3.401 (b)(3). In other words, if VA receives a claim within a year of the Veteran's notification of a rating decision assigning at least a 30 percent disability rating, the effective date for the addition of the dependent to his award will coincide with the effective date of that disability rating assigned in the rating decision. The Veteran was awarded additional compensation for service-connected disabilities and assigned at least a 30 percent disability rating effective August 23, 2019, in an April 2020 rating decision. He was notified of that decision later that month. Because the receipt of the VA Form 21-686c notifying VA of his spouse was received within a year of the April 2020 notification of this qualifying disability rating, the proper effective date for the addition of this spouse coincides with the effective date of the grant from that April 2020 rating decision (i.e., August 23, 2019). However, payment of compensation for this grant does not commence until the first day of the month following that effective date. See 38 C.F.R. § 3.31. The record reflects that September 1, 2019, is the date that payment has commenced for the additional dependency compensation for the Veteran's current spouse, and the Board finds that that date is the appropriate effective date for the calculation of the overpayment in the instant case. Although the Veteran suggests that a date in 2013 is more appropriate, no earlier claim was received which would entitle him to such an early effective date. As such, the Board finds that the Veteran was not legally entitled to additional dependency compensation for M.A.V. until September 1, 2019. As legal entitlement to the benefit of additional dependency compensation for the period giving rise to the overpayment has not been established, the Board must turn ot the question of whether the debt in question was created solely by VA. In deciding this question, it is important to note that a beneficiary is charged with knowing the rules governing compensation. Dent v. McDonald, 27 Vet. App. 362, 382 (2015) (summarizing Jordan v. Brown, 10 Vet. App. 171, 174-75 (1997)). "Knowledge" is "[a]n awareness or understanding of a fact or circumstance; a state of mind in which a person has no substantial doubt about the existence of a fact." BLACK'S LAW DICTIONARY 950. A person may have actual or constructive knowledge of a fact, the latter of which is defined as "[k]nowledge that one using reasonable care or diligence should have, and therefore that is attributed by law to a given person." Dent v. McDonald, 27 Vet. App. 362, 380 (2015). 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); 38 C.F.R. § 3.500(b)(1); VAOPGREC 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. Here, there are no contentions that the Veteran submitted to VA evidence of his current marriage or the fact that his previous spouse had died prior to the March 2021 VA Form 21-686c. The record also contains numerous letters sent to the Veteran prior to the death of his late spouse informing him of the additional payment he was receiving for her as well as the need to inform VA right away if any change were to occur in the status of his dependents. VA sent such letters in July 1992, January 1997, May 1998, August 2000, and April 2014. For example, in the April 2014 letter notifying the Veteran that, among other claims, his claim for an increase in the disability rating for his service-connected coronary artery disease had been granted, VA informed him explicitly that his compensation included an additional amount for his spouse R.C. It further informed him that he needed to let VA know right away if there were any change in his marital status "(for example, death, divorce, annulment)." Based on these numerous letters, the Board finds that the Veteran knew, or should have known, that he was in receipt of additional dependency compensation for R.C. and that he was required to inform VA right away if any change in their marital status occurred, to include due to her death. The Board acknowledges that the Veteran does not challenge these facts and sympathizes with his request that VA consider an earlier payment date for his current spouse. However, the Board is bound by the statutes and regulations governing the provision of VA benefits. In light of his knowledge that he was in receipt of additional dependency compensation for R.C. to which he was not entitled, the Board cannot say as a matter of law that the overpayment caused by the delayed reporting of her death and the delayed reporting of his marriage to his current spouse was not properly created. The Board emphasizes to the Veteran, however, that if he has not yet received a demand letter for this overpayment and wishes to request a waiver of the debt, he should promptly submit such a request in accordance with the instructions on any such demand letter he may receive in the future. Shamil Patel Acting Veterans Law Judge Board of Veterans' Appeals Attorney for the Board B. Whitelaw, 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.