92 Decision Citation: BVA 92-29319 Y92 BOARD OF VETERANS' APPEALS WASHINGTON, D.C. 20420 DOCKET NO. 89-46 569 ) DATE ) ) ) THE ISSUE Entitlement to restoration of a compensable rating for bilateral hearing loss. REPRESENTATION Appellant represented by: Disabled American Veterans ATTORNEY FOR THE BOARD Martin F. Dunne, Counsel INTRODUCTION This matter comes before the Board of Veterans' Appeals (Board ) on REMAND from the United States Court of Veterans Appeals (Court). In a decision of June 25, 1991, the Board denied the veteran entitlement to a compensable disability rating for service-connected bilateral defective hearing. In so doing, the Board affirmed the April 1989 rating action of the Baltimore, Maryland regional office (RO) which reduced the veteran's prior 10 percent evaluation, which had been in effect since November 1983 for service-connected bilateral hearing loss, to a noncompensable rating effective from July 1989. The Court, in Fugere v. Derwinski, 1 Vet.App. 103 (1990), held that the Department of Veterans Affairs' (VA) attempted recision of M21-1 (that is, the Department of Veterans Affairs Adjudication Procedure Manual), Part I, para. 50.13(b), which instructed VA rating boards not to reduce benefits for hearing loss where the reduction is due to changed criteria, without complying with the requirements of 5 U.S.C. §§ 552(a)(1) and 553 was "without observance of procedure required by law." The Court then remanded the case to the Board with the direction to reinstate the appellant's disability rating in accordance with para. 50.13(b). On August 7, 1992, the United States Court of Appeals for the Federal Circuit affirmed the Court's decision in Fugere. On October 27, 1992, the United States Court of Appeals for the Federal Circuit denied the Secretary of Veterans Affairs' request for an en banc rehearing of its August 7, 1992, decision. Subsequently, in November 1992, the Office of the General Counsel, Department of Veterans Affairs, advised the Under Secretary for Benefits, Department of Veterans Affairs, that further review of this case would not be sought. Consequently, the case is now before the Board for implementation of the Fugere guidelines. CONTENTIONS OF APPELLANT ON APPEAL The veteran contends that the RO committed error in reducing his 10 percent rating for service-connected bilateral defective hearing. Specifically, it is argued that the action of the RO reducing the veteran's 10 percent evaluation for service-connected bilateral defective hearing to a noncompensable rating was in violation and contrary to the provisions set forth in para. 50.13(b) of the VA's Adjudication Procedure Manual (M21-1). DECISION OF THE BOARD In accordance with the provisions of 38 U.S.C.A. § 7104 (West 1991), following review and consideration of all evidence and material of record in the veteran's claims file, and for the following reasons and bases, it is the decision of the Board that the record supports restoration of a 10 percent evaluation for service-connected bilateral defective hearing. FINDINGS OF FACT 1. The RO reduced the evaluation of the veteran's service-connected bilateral hearing loss from 10 percent to a noncompensable rating based solely on a change in rating criteria and not on any showing of auditory improvement. 2. No improvement in the service-connected hearing loss had been shown at the time of the April 1989 rating action. CONCLUSION OF LAW Restoration of a 10 percent evaluation for service-connected bilateral defective hearing is warranted. 5 U.S.C. §§ 552(a)(1), 553 (1988); 38 U.S.C.A. § 7261(a)(3)(D) (West 1991); 38 C.F.R. §§ 1.12, 1.551(c) (1991); Department of Veterans Affairs Adjudication Procedure Manual, M21-1, para. 50.13(b); Fugere v. Derwinski, 1 Vet.App. 103 (1990), aff'd 972 F.2d 331 (Fed. Cir. 1992). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The veteran served on active duty from March 1970 to September 1976. His discharge certificate indicated that he also had 10 years and 7 months of active duty prior to March 1970. He seeks review of an April 1989 decision of the RO reducing his 10 percent rating for bilateral defective hearing to a noncompensable rating. The veteran argues that para. 50.13(b) of the VA Adjudication Procedure Manual (M21-1) was changed to his detriment in violation of 5 U.S.C. §§ 552(a)(1) and 553 (1988), in that he was not given notice and an opportunity to comment. Effective in December 1987, new criteria for the evaluation of service-connected defective hearing were established by VA. Despite the adoption of such new rating criteria and testing methods, veterans were to be protected against a decrease in benefits if there had not been improvement in the veteran's condition or disability. Para. 50.13(b) of M21-1 specifically provided the following direction to adjudicators: "Changed Criteria. If the decrease in evaluation is due to changed criteria or testing methods, rather than a change in disability, apply the old criteria and make no reduction." Notwithstanding the aforementioned, the VA Chief Benefits Director, by an internal memorandum to the RO Directors, dated November 23, 1988, rescinded the protective manual paragraph. Such rescission had the effect of legitimizing a reduction in benefits for service-connected bilateral defective hearing based solely upon revised schedular criteria, with no demonstrated clinical improvement in the veteran's service-connected hearing loss. The Court, in Fugere v. Derwinski, 1 Vet.App. 103 (1990), aff'd 972 F.2d 331 (Fed. Cir. 1992) found that, in deleting Manual para. 50.13(b) without giving notice or an opportunity to comment, the VA had failed to comply with the requirements of 5 U.S.C. §§ 552(a)(1) and 553. Such compliance was required by 38 C.F.R. §§ 1.12 and 1.551(c). The Court, therefore, held that the attempted rescission of Manual para. 50.13(b) was "without observance of procedure required by law" and was, accordingly, to be held "unlawful and set aside" pursuant to what is now codified at 38 U.S.C.A. § 7261(a)(3)(D). In light of such holding, the provisions of para. 50.13(b) of the VA's Adjudication Procedure Manual (M21-1) must be considered to be a valid rule. Consequently, the 10 percent evaluation previously assigned for the veteran's bilateral defective hearing must be reinstated. ORDER Restoration of a 10 percent rating for service-connected bilateral hearing loss is granted, subject to the regulations governing the payment of monetary benefits. BOARD OF VETERANS' APPEALS WASHINGTON, D.C. 20420 J. E. DAY DOMENIC E. SABATINI, M.D. SAMUEL W. WARNER NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West 1991), a decision of the Board of Veterans' Appeals granting less than the complete benefit, or benefits, sought on appeal is appealable to the United States Court of Veterans Appeals within 120 days from the date of mailing of notice of the decision, provided that a Notice of Disagreement concerning an issue which was before the Board was filed with the agency of original jurisdiction on or after November 18, 1988. Veterans' Judicial Review Act, Pub. L. No. 100-687, § 402 (1988). The date which appears on the face of this decision constitutes the date of mailing and the copy of this decision which you have received is your notice of the action taken on your appeal by the Board of Veterans' Appeals.