93 Decision Citation: BVA 93-01017 Y93 BOARD OF VETERANS' APPEALS WASHINGTON, D.C. 20420 DOCKET NO. 90-46 688 ) DATE ) ) ) THE ISSUE 1. Restoration of a 60 percent disability rating for a bilateral hearing loss. 2. Propriety of the reduction from a 30 percent to 10 percent disability rating for psychoneurosis, mixed type, effective from May 1, 1990. REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL The Appellant and his spouse ATTORNEY FOR THE BOARD R. M. Pelletier, Counsel INTRODUCTION The appellant served on active duty during World War II. This matter came to the Board of Veterans' Appeals (hereinafter the Board) from a January 1990 rating decision of the Department of Veterans Affairs (VA) St. Petersburg, Florida, Regional Office (RO). The purpose of that rating action was to effectuate an administrative review under 38 C.F.R. 3.105(e) in which the veteran's 60 percent disability rating from January 1984 for a bilateral hearing loss was reduced to a 20 percent evaluation from May 1990; and the 30 percent disability rating for psychoneurosis, mixed type, effective from March 15, 1985, was reduced to a 10 percent evaluation from May 1, 1990. The veteran's notice of disagreement was received in March 1990. A rating action in April 1990 confirmed and continued the prior rating decision. A statement of the case was issued in May 1990. The substantive appeal was received in May 1990. In July 1990, the veteran and his spouse appeared and presented testimony before a hearing officer at the RO. In August 1990, the hearing officer confirmed and continued the prior rating actions, noting that despite the veteran's contention that he had not been properly notified of his right to refuse the hearing examination, the findings justified the reduction in the veteran's rating. A supplemental statement of the case was issued in August 1990. The appeal was docketed at the Board in October 1990. Throughout the appellate process, the veteran has been represented by the Disabled American Veterans. An informal brief was presented to the Board by that organization in November 1990. In May 1991, the Board denied entitlement to increased ratings for the bilateral hearing loss or the psychoneurosis, mixed type. Following the Board's action, the veteran appealed the decision to the United States Court of Veterans Appeals (the Court). The Court, in Fugere v. Derwinski, 1 Vet.App. 103 (1990), held that the VA's attempted rescission of M21-1 (that is, the Department of Veterans Affairs Adjudication Procedure Manual), Part I, paragraph 50.13(b), which instructed VA rating boards not to reduce benefits for hearing loss where the reduction was due to changed criteria, without complying with the requirements of 5 U.S.C. §§ 552(a)(1) and 533 (1988) was "without observance of procedure required by law." The Court then remanded the Fugere appeal to the Board with the direction to reinstate the appellant's disability rating in accordance with paragraph 50.13(b). The VA appealed the case to the United States Court of Appeals for the Federal Circuit, and on August 7, 1992, that Court affirmed the Court of Veterans Appeals decision in Fugere. On October 27, 1992, the Court of Appeals for the Federal Circuit declined the Secretary of Veterans Affairs suggestion for a hearing en banc of its August 7, 1992, decision. Concerning the case presently before the Board, on December 6, 1991, the Court, citing Fugere v. Derwinski, 1 Vet.App. 103 (1990)reversed and remanded the previous BVA decision, directing the Board to "...consider and follow as appropriate the precedential decisions of this Court in the readjudication of the appellant's claim." Consequently, the case is now once again before the Board for further adjudicatory action. The veteran's representative, in the November 1992 informal hearing presentation, requested consideration of the issue of entitlement to a total rating for compensation purposes based on individual unemployability by reason of service- connected disabilities. That issue has not been developed and is not certified for Board review. It will be referred to the RO for actions deemed appropriate. CONTENTIONS OF APPELLANT ON APPEAL In essence, it is averred by the appellant that he was not properly advised by the VA of his right to refuse evaluation of his hearing and that audiological testing performed on December 13, 1989, would be evaluated by new and different criteria. It is averred that there has been a violation of the VA policy. Concerning his psychoneurotic disorder, it is averred that the reduction from 30 percent to 10 percent was in violation of the provisions of 38 C.F.R. § 3.344, as he had been in receipt of the 30 percent rating in excess of five years. 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 the 60 percent evaluation for bilateral hearing loss; and restoration of the 30 percent disability rating for psychoneurosis, mixed type. FINDINGS OF FACT 1. All relevant evidence necessary for an equitable disposition of this appeal has been obtained by the RO. 2. By rating action in January 1990 the 60 percent evaluation from January 1984 for a bilateral hearing loss was reduced to 20 percent from May 1990, based on a change in VA regulations. 3. No improvement in the service-connected hearing loss had been shown at the time of the January 1990 rating. 4. The January 1990 rating decision which reduced the evaluation for psychoneurosis from 30 percent to 10 percent did not apply the regulatory requirements of "sustained improvement" and "reasonable certainty" that improvement would be maintained under the ordinary conditions of life, and examination. CONCLUSIONS OF LAW 1. Restoration of a 60 percent evaluation for service-connected bilateral hearing loss is warranted. Department of Veterans Affairs Adjudication Procedure Manual, M21-1, paragraph 50.13(b); Fugere v Derwinski, 1 Vet.App. 103 (1990). 2. The January 1990 rating decision is void ab initio and the 30 percent rating for psychoneurosis must be restored. 38 C.F.R. § 3.344(a) (1991). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Board finds that the veteran's claims are well grounded and are not inherently implausible. We find that the facts relevant to the issues on appeal have been properly developed and that the statutory duty of the VA to assist the veteran in the development of his claim has been satisfied. 38 U.S.C.A. § 5107(a) (West 1991). I. Bilateral Hearing Loss The veteran in this case seeks review of the January 1990 decision of the RO reducing the 60 percent evaluation for service-connected bilateral hearing loss. In effect, it is argued that paragraph 50.13(b) of the VA's Adjudication Procedure Manual (M21-1) was changed to his detriment in violation of 5 U.S.C.A. §§ 552(a)(1) and 553 (1988) of the Administrative Procedure Act, in that he was not given notice and an opportunity to comment. In June 1984, the veteran was afforded a VA audiometric examination. Examination of the right ear revealed pure tone thresholds of 100, 80, and 85 decibels at the frequencies of 500, 1000 and 2000 cycles per second, respectively, for an average decibel loss of 88. Left ear pure tone thresholds were certified as 110, 90, and 70 decibels at frequencies of 500, 1000, and 2000, respectively. On that basis, he was awarded a 60 percent evaluation for the bilateral hearing loss, effective March 15, 1985. On VA audiometric testing in December 1989, right ear pure tone thresholds were certified as 90, 95, 105 and 105-plus decibels at frequencies of 1000, 2000, 3000 and 4000 Hertz with an average decibel loss of 99. Left ear pure tone thresholds were certified as 95, 75, 90 and 90 decibels at frequencies of 1000, 2000, 3000 and 4000 Hertz with an average decibel loss of 88. Following that evaluation, the veteran's 60 percent evaluation for the hearing loss was reduced to 20 percent. This action was based on new criteria for measuring hearing loss. In December 1987, new criteria for the evaluation of service-connected defective hearing were established by the VA. Despite the adoption of such new rating criteria and testing methods, veterans service connected for a hearing loss were to be protected against a decrease in benefits if there had not been any change in the veteran's condition or disability. Paragraph 50.13(b) of the VA's Adjudication Procedure Manual, 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 VARO directors dated November 23, 1988, rescinded the protective manual paragraph. Such rescission had the effect of legitimizing a reduction in benefits for service-connected 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 found that, in deleting Manual paragraph 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 (1988). 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 paragraph 50.13(b) was "without observance of procedure required by law" and was, accordingly, to be held "unlawful and set aside" pursuant to 38 U.S.C.A. § 7261(a)(3)(D). In light of such holding, the provisions of paragraph 50.13(b) of the VA's Adjudication Procedure Manual (M21-1) must be considered to be a valid rule. Consequently, the reduction of the veteran's prior 60 percent evaluation for service-connected bilateral hearing loss to 20 percent was in error, and the 60 percent rating must be reinstated. II. Psychoneurosis, Mixed Type The issue presented for Board review is whether the RO properly reduced the 30 percent disability rating for service-connected psychoneurosis, mixed type, to a 10 percent evaluation. Some of the basic facts are not in dispute. Effective March 15, 1985, the RO awarded the veteran a 30 percent disability rating for service-connected psychoneurosis, mixed type. In December 1989, he was afforded a VA psychiatric examination. He complained of an inability to tolerate crowds or noises. He was preoccupied with his hearing deficit. He was described as having difficulty hearing the examiner. He did not show disturbance of mood or affect. Cognitive functions were appropriate for his age. There was no evidence of hallucinations, delusions or psychosis. There was no suicidal or homicidal thinking noted. The impression was: Adjustment reaction with anxiety due to hearing loss. On the basis of that examination, the RO, in January 1990, reduced the 30 percent evaluation for the anxiety reaction to 10 percent. Evidence in support of the appellant's claim, includes testimony presented at his hearing held before a hearing officer at the RO. He testified that he was unable to understand the examiner during his November 1989 psychiatric examination, because of the examiner's foreign accent. Transcript, hereinafter T., at 8. He stated that he was prescribed hydroxyzine pamoate for his nervous disorder. T.9. His wife testified that his hearing loss contributed to his frustration. T.10. The Board has carefully reviewed this claim. In reviewing the January 1990 rating decision and the statement of the case provided to the veteran, it does not appear that the RO considered 38 C.F.R. § 3.344 when making its determination. In pertinent part, the regulation states: "Rating agencies will handle cases affected by change of medical findings or diagnosis so as to produce the greatest degree of stability of disability evaluations consistent with the laws and Department of Veterans Affairs regulations governing disability compensation and pension. It is essential that the entire record of examinations and the medical-industrial history be reviewed to ascertain whether the recent examination is full and complete, including all special examinations indicated as a result of general examination and the entire case history....Ratings on account of diseases subject to temporary or episodic improvement, e.g., manic-depressive or other psychotic reaction,...will not be reduced on any one examination, except in those instances where all the evidence of record clearly warrants the conclusion that sustained improvement has been demonstrated....Moreover, though material improvement in the physical or mental condition is clearly reflected the rating agency will consider whether the evidence makes it reasonably certain that the improvement will be maintained under the ordinary conditions of life." 38 C.F.R. § 3.344(a). In the present case, the reduction was based solely on the December 1989 VA psychiatric examination. Additional VA outpatient records were obtained after the rating decision reducing the evaluation, and cannot be used to retroactively bolster that decision. See, Johns v. Derwinski, 2 Vet.App. 346, 349 (1992). It is clear that the rating decision in question did not specifically compare the findings on the November 1989 to those on earlier examinations to determine if there had been "sustained improvement" and if it was "reasonably certain that the improvement will be maintained under the ordinary conditions of life" as required by 38 C.F.R. § 3.344(a). This indicates an administrative failure to apply the correct regulatory provisions to the correct and relevant facts. The reduction is therefore void ab initio. Murincsak v. Derwinski, 2 Vet.App. 363, 369 (1992); Lehman v. Derwinski, 1 Vet.App. 339, 343-44 (1991). ORDER Restoration of a 60 percent disability rating for a bilateral hearing loss is granted. Entitlement to a restoration of the 30 percent disability rating for psychoneurosis, mixed type, effective May 1, 1990, is granted. The appeal is granted subject to the law and regulations governing the criteria for an award of monetary benefits. BOARD OF VETERANS' APPEALS WASHINGTON, D.C. 20420 * J. E. DAY (MEMBER TEMPORARILY ABSENT) SAMUEL W. WARNER *38 U.S.C. § 7102(a)(2)(A) (1992) permits a Board of Veterans' Appeals Section, upon direction of the Chairman of the Board, to proceed with the transaction of business without awaiting assignment of an additional Member to the Section when the Section is composed of fewer than three Members due to absence of a Member, vacancy on the Board or inability of the Member assigned to the Section to serve on the panel. The Chairman has directed that the Section proceed with the transaction of business, including the issuance of decisions, without awaiting the assignment of a third Member. NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C. § 7266 (1992), 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.