Groves: "Pausing" Adjudication and Prejudicial Error

Groves v. McDonough, Opinion Number 17-3084, was decided March 25, 2021 and involves whether a veteran can “pause” adjudication of an issue and the Court’s increasing use of prejudicial error.

The central issue in this case is whether the Board erred in adjudicating the appellant's VRE claim in light of his requests that VA refrain from doing so and in the absence of his reauthorization to do so. With respect to this issue, the Board stated:

The [appellant] has submitted numerous "motions to enjoin" the Board from issuing a decision with regard to the VRE claim. However, these notices do not constitute a withdrawal of the appeal, such that there is no basis for the Board to not proceed with its appellate review of this claim.

Id. at *10.

The Court began by “mak[ing] clear that the appellant's requests that VA refrain from adjudicating his VRE claim did not deprive the Board of jurisdiction to address that claim, because jurisdiction is conferred by statute.”  Id. at *10.

It then determined:

Having found that Hamilton is clear that VA must honor a claimant's request to pause adjudication of his or her claim, a request that the Board found that the appellant in this case made with respect to his VRE claim, we must consider the effect of the Board's error in proceeding prematurely with its adjudication.  In that regard, the Court has already concluded that a request pursuant to Hamilton does not divest the Board of jurisdiction to act.  The question remains whether the Board proceeding without authority renders its decision void ab initio.

Id. at *13.

The Court then pivoted toward a prejudicial error analysis and stated: “Because the Board's procedural error does not render its decision denying the appellant's claim for VRE benefits void ab initio, we must next consider whether the appellant has "alleged with specificity any prejudice that resulted from" the Board's adjudication of his VRE claim.”  Id. at *13.  It then explained:

“neither the appellant nor amici explain how he was harmed by the Board's adjudication of his VRE claim. Although the appellant raises matters of equity, due process, and spoliation of records, the Court finds, as discussed below, that those arguments are unpersuasive; accordingly, they do not serve to establish that the Board's error prejudiced him in any way. Moreover, the appellant does not allege that if he had been afforded additional time prior to the Board's decision, he would have submitted additional evidence or argument that could have affected the outcome of his VRE claim. Cf. Bryant, 33 Vet.App. at 49-50 (finding prejudice where the appellant asserted that he would have submitted argument and evidence if afforded the maximum time to do so). In the absence of demonstrated prejudice, the Court need not remand this matter for the Board to correct its procedural error.”

Id. at *14.

C.J. Bartley wrote a concurrence stating she agreed in result because she did not read Hamilton as creating a procedural tool that allows claimants to indefinitely pause the VA adjudication process at will.  Id. at *19. 

She explained:

as the majority here notes, Hamilton then stated "where, as here, the claimant expressly indicates an intent that adjudication of certain specific claims not proceed at a certain point in time, neither the RO nor BVA has authority to adjudicate those specific claims, absent a subsequent request or authorization from the claimant or his or her representative." Id. This sentence has been interpreted as allowing a claimant to suspend VA adjudication at will, and the majority hangs its hat on that quote. However, "[i]t is axiomatic that the language in . . . [any case] must be read in light of the facts and issues that were before the court when the language was written." Grantham v. Brown, 114 F.3d 1156, 1158 (Fed. Cir. 1997). Because suspension of adjudication wasn't at issue in Hamilton—Mr. Powell merely asked that his three additional claims not proceed with the lung cancer and HD appeals—that case cannot stand for the proposition that VA is required to indefinitely suspend adjudication of a claim at the claimant's will.

Id. at *20.

It appears the Court has reiterated that Hamilton creates a right of a veteran to pause adjudication of an issue.  However, the Court then so dramatically limited prejudicial error as to render the right created by Hamilton seemingly useless.  The import of this case is probably less about Hamilton or VRE, but the Court’s increasing use of prejudicial error to insulate their opinions from effective review.

Opinion by Judge Meredith and joined by Judge Falvey. Dissent by C.J. Bartley.

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Sheppard: Board's Decision as to New and Material Evidence in the First Instance and Without Notice

Sheppard v. Shinseki, Opinion Number 19-4776, was decided March 15, 2021 and involves whether the Board had to provide notice that there was a new and material evidence issue where the RO had previously reopened a claim. 

A claim for service connection for a hand and mental health disability had been denied several times and ultimately a September 2016 SOC found the claims were reopened, but denied service connection based on a lack of a nexus opinion.  The case was appealed to the Board, which found new and material evidence had not been submitted and denied reopening the claims.

The veteran argued the issue of new and material evidence is a jurisdictional requirement of the Board, but 38 CFR Section 20.101(d) applies to require that the Board give notice of the issue to the veteran. The VA argued Jackson v. Principi, 265 F.3d 1366, 1369 2 (Fed. Cir. 2001), controlled.  Jackson found the degree of overlap in the evidence that would require reopening or the merits of claim are so similar that a claimant is not prejudiced when not given notice the Board will consider the issue.

The Court noted:

no one should ever be surprised that the Board independently considered whether there was sufficient evidence to reopen a claim because it is required to do so. However, although the Board generally must ensure its jurisdiction, if it sua sponte raises an issue with an NOD, SOC, or SA, that may come as a surprise to a claimant and necessitates different evidence and argument than the merits of the claim.

Id. at *8.

The Court then notes:

The Federal Circuit's and our cases may characterize the new and material evidence question as a jurisdictional one.  But how the Board has always handled and disposed of requests to reopen versus other jurisdictional matters and that our Court has never faulted the Board for denying a request to reopen, rather than dismissing the appeal of that claim, further demonstrates the distinction between the two.

Id. at *9.

The Court then found the procedural safeguards of Section 20.104(c)-(d) do not apply to requests to reopen claims because Jackson supports the proposition that the issues of reopening and merits are so similar that the arguments would overlap and notice from the Board is not required.

The Court then undertook a prejudicial error analysis and determined the veteran had not identified newly submitted evidence showing a nexus (the missing link in this case). 

Chief Judge Bartley wrote a cogent and blistering dissent.  Succinctly she argues: “Section 20.101(d) is a VA-created rule that affords veterans the right to notice, a hearing, and the opportunity to submit evidence where the Board raises a potential jurisdictional defect, and the Board was bound to apply it here.”  Id. at *15.  She roots her analysis in the plain meaning of the regulation.  She also argues Jackson does not apply as it predates the notice regulation.  As far as overlapping evidence in reopening and merits of a claim, she argues the reopening legal threshold is lower.  She also argues holding a claimant to a higher legal standard than the law requires is not harmless error.  Id. at *18.

This determination that the issues involved in a claim before the Board (moving down from the merits to whether it should even have been reopened) does not trigger a notice requirement is troubling and demonstrates the willingness of the Board to deny veteran’s a voice.  This decision seems to support such a finding.  I can only hope it is appealed and set right by the Federal Circuit.

Opinion by Judge Falvey and joined by Judge Allen. Dissent by C.J. Bartley.

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Hatfield: Section 1151 Claims and Informed Consent

Hatfield v. Shinseki, Opinion Number 19-7165, was decided March 8, 2021 and a Section 1151 claim (VA’s own medical malpractice) and specifically informed consent.

The veteran developed Stage 2B Hodgkin’s disease which manifested as a large mass in the chest wall of his lungs.  His VA physician recommended radiation therapy to reduce the size of the tumor, which occurred from September to November 1978.  The veteran’s medical records contained no evidence of any informed consent for the radiation therapy.

The radiation therapy eliminated the veterans’s Hodgkins’s disease, but produced adverse effects including severe pulmonary complications.  He died in 1979 due to those pulmonary complications.

The veteran’s widow filed a DIC claim and a VA medical opinion stated the VA had provided an appropriate care plan and standard of care.  The opinion also noted radiation pneumonitis is a predictable  result of radiation therapy, but also that the rate at which patients can experience it can vary as much as 50%.  The VA denied which led to a multi-decade procedural history replete with Board and Court remands.

The widow argued:

First, she argues that the Board erred in determining that informed consent was obtained because it misapplied both 38 C.F.R. §§ 17.32 and 3.361 as well as our decision in McNair. 38 Appellant asserts that VA obtained no informed consent and as a matter of law such a lack of consent satisfies the proximate causation requirement of § 3.361(d)(1)(ii).39 She contends the Board erred when it used McNair to establish consent instead of curing consent that was otherwise defective. Appellant seeks reversal on this basis.40 Second, appellant argues that the Board erred in finding no pending issues remaining from the time of the 1980 Board decision.41 Specifically, she contends that the October 1980 Board decision denying her claim did not address whether the quickness of the veteran's death was an unforeseeable event.

Id. at *4-5.

The Court centered its Section 1151 analysis on proximate causation and then turns to the implementing regulation, 38 C.F.R. 3.361.  In part, Section 3.361 “provides that proximate causation can be established with a showing of "carelessness, negligence, lack of proper skill, error in judgment, or similar instance of fault on VA's part in furnishing hospital care, medical or surgical treatment, or examination caused for the additional disability or death.”  Id. at *9.  Informed consent fits into Section 3.361(d)(1) because

[t]o establish that the proximate cause of a disability was . . . carelessness, negligence, lack of proper skill, error in judgment, or similar instance of fault on the part of VA, the claimant must show either (1) VA failed to exercise the degree of care that would be expected of a reasonable health care provider; or (2) VA furnished the care, treatment, or examination without the veteran's informed consent.

 

***

The plain language of subparagraphs 3.361(d)(1)(i) and (ii) further show that proximate causation is established when VA fails to exercise the expected standard of care of a reasonable health care provider or, as relevant here, when VA fails to obtain the veteran's informed consent based on the requirements of 38 C.F.R. § 17.32.

Id. at *9-10.

In this case, the Board noted informed consent was established by substantially complying with Section 17.32 or “by evidence that a reasonable person in similar circumstances would have proceeded with the medical treatment even if informed of the foreseeable risk.” See McNair v. Shinseki.”  Id. at *11.

The Court noted that in McNair v. Shinseki, informed consent was given with a signed informed consent form, but the consent was defective.  However, McNair stood for the proposition that: “VA's failure to inform a patient about a potential adverse effect did not defeat a finding of informed consent if a reasonable person faced with similar circumstances would have proceeded with the treatment.”  Id. at *12.

In the case at hand, the Court determined:

the facts before us are different from those in McNair, because here there was no documentation of the veteran's informed consent at all. We conclude that McNair does not apply when there is no attempt to obtain consent (as opposed to where defective consent has been obtained). Therefore, the Board legally erred by applying the McNair minor-deviation standard to appellant's case.

Id. at *12.

In sum, the Court holds that that the minor-deviation exception provided in § 3.361(d)(1)(ii) applies only when there has been a predicate finding of informed consent (as directed by the first sentence in that subparagraph) that is in substantial compliance with § 17.32's requirements (as contemplated under the second sentence). Furthermore, we hold that the McNair rule does not apply to situations where no informed consent was obtained or attempted. Thus, the Board legally erred in applying the third sentence of § 3.361(d)(1)(ii) and the reasonable person standard from McNair when it made no finding of an attempt to provide informed consent in substantial compliance with § 17.32. Simply put, the minor-deviation exception does not allow the Board to conjure informed consent when no attempt at obtaining consent can be demonstrated and, especially, when the Board itself makes a finding that there was no informed consent.

Id. at *14.

The Court then considered the remedy in this case.  The Court noted that under Section 1151 the three elements are

(1) The veteran must have experienced a qualifying additional disability or death that was not the result of the veteran's willful misconduct; (2) the additional disability or death must be caused by VA medical treatment, care, or examination (i.e., actual causation); and (3) the proximate cause of the veteran's additional disability or death was "carelessness, negligence, lack of proper skill, error in judgment, or similar instances of fault on the part" of VA or "an event not reasonably foreseeable" (i.e., proximate causation).

Id. at *14.  The Court then noted the Board itself determined the first two factors were met.  It also noted normally remand would be appropriate, but noted the Board determined there was no attempt to obtain informed consent.  Id. at *15.  “The fact of the matter is that there is little room to read the Board decision as doing anything other than making a factual finding that there was no proper procurement of informed consent because VA did not document the informed consent process according to § 17.32. The Board thought that was not dispositive because of its erroneous view of the law.”  Id. at *16.

This case is remarkable in limiting McNair to cases where there is a showing of an attempt at informed consent (i.e., the minor deviation exception can't save a situation where their was no evidence of informed consent) and that the Court actually reversed and granted DIC.  A reversal and grant is very rare, but likely made in this case due to the fact the case had gone on for so long—sympathy is still a factor.  The facts in this case might make the ruling limited, but it is still a nice victory for a veteran.

Decision by Judge Allen and joined in by Chief Judge Bartley and Judge Greenberg.

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Healey: Hypertension, The PurpleBook, and a Reasonably Raised Claim

Healey v. Shinseki, Opinion Number 18-6970, was decided February 24, 2021 and concerns several issues of importance: hypertension and what the Board knows based on the Purple Book and National Academy of Sciences Agent Orange Updates.

The veteran served in Vietnam and sought service connection for hypertension.  The National Academy of Sciences has published a Veterans and Agent Orange: Update 2012 which found a potential connection between hypertension and herbicide.  After the NAS’s report, the Board issued internal guidance in something called The Purplebook which addresses the existence of the NAS report and notes in claims involving hypertension and herbicide exposure, the Board cannot deny a claim without a medical opinion.

The PurpleBook is:

a document that describes itself as "encompass[ing] all Board policies and procedures." Appellant's Br., Exhibit A at 2.5 (Board of Veterans' Appeals, U.S. Dep't of Veterans Affairs, The Purplebook, Version 1.0.0 (March 8, 2018)). Subject to routine updates, it serves as "a repository of guidance for all Board employees on the internal operating processes of the Board" and is meant to "ensure consistency and accountability in the handling of appeals throughout the Board.”

Id. at *4.

A prior case, Euzebio v. Wilkie, 31 Vet. App. 394 (2019) had found the mere existence of the NAS report does not trigger the VA’s duty to obtain a medical opinion.  There, the Court found the NAS report was not constructively before the Board because it did not have a direct relationship with his claim. The Secretary argued Euzebio was dispositive.  However, the Court noted the interceding inclusion of the topic on hypertension and herbicide in The PurpleBook and relied on Overton v. Wilkie, 30 Vet. App. 257 (2018) to find the Board cannot ignore a relevant portion of the VA’s own internal manuals. It noted:

Because the Purplebook provision Mr. Healey cites is relevant to the issue of whether a medical nexus opinion was warranted in these circumstances, the Board erred in not addressing it.  So, irrespective of whether the Purplebook binds the Board, this omission requires that we vacate the decision on appeal and remand for further proceedings.

Id. at *2. 

The Court explained:

Like the M21-1, the Purplebook can be deemed analogous to "agency action" insofar as it constitutes interpretations adopted by the agency, notwithstanding the lack of binding effect. DAV, 859 F.3d at 1075–76. As was the M21-1 for frontline adjudications, the Purplebook was designed to assist Board members and to provide a comprehensive source account of various considerations and procedures that may be relevant to an individual claim or disability. Regardless of whether the Purplebook is binding, the Board's public adoption of it as the repository of its "internal guidelines and procedures," Mason Memo at 1, brings it within Overton's rationale

Id. at *9.

The Court helpfully explained:

In short, where a provision of the Purplebook is relevant to a veteran's appeal, the Board must incorporate a discussion of the relevant provision into its analysis. And even as the Board remains free to determine whether or how to apply such provision, it must provide a reasoned basis for departing from the guidance offered by the provision.

Id. at *10.

Judge Meredith concurred that a remand was necessary, but sought to limit the theory of entitlement raised.  She argued did the Board did not address the veteran’s hypertension and herbicide argument because the veteran did not advance that theory below, but made a secondary service connection argument related to diabetes.  She took the majority to task for assuming the theory was reasonably raised without fully explaining that result and specially focused on her view that a theory need not be addressed if not specifically alleged in that claim stream.

This case is helpful for hypertension cases and shows how to use The PurpleBook on appeal to the Court.  However, Judge Meredith’s evident desire to restrict what has reasonably been raised needs to be squared with what is supposed to be a non-adversarial system designed to maximize a veteran’s claim.  Her viewpoint pushed to its extreme could force veterans to become physicians or at least employ them in order to fully argue their claim.

Opinion by Judge Toth, joined by Judges Allen and Meredith.

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Cooper: Unemployment and a Non-Service Connected Pension

Cooper v. McDonough, Case Number 19-2009, decided February 26, 2021 involves how countable income is calculated for a non-service connected pension.  The Court determined state unemployment compensation is counted as income.

A non-service connected pension provides an income floor for wartime veterans, the idea was to prevent our wartime veteran from sinking into poverty.  However, a veteran only receives it if they have very little income.  This year that amount is approximately $13,000.  However, a provision in the statute excludes certain types of income, including:  “donations from public or private relief or welfare organizations.” 

This case arose when the veteran started receiving a NSC pension and then later started receiving social security disability insurance.  The VA reduced his monthly NSC pension payment and created an overpayment, which it later waived.  Later, he received state unemployment compensation for several years and as a result the VA determined that compensation should count toward the limit and resulted in a $13,094 overpayment.  The veteran sought a waiver of the debt and argued his state unemployment compensation should not be considered income.  The VA took the position that it was income.

Before the Court, the veteran argued state unemployment compensation is "public relief for the unemployed," and constitutes a donation from public relief or welfare organizations and is thus excluded from countable income under 38 U.S.C. § 1503(a)(1).

The Court found that unemployment compensation is not specifically excluded as income, but then considered whether it counts as a donation from public relief or welfare organization.  The Court determined based on the plain meaning that:

Taken together, the plain meaning of "public . . . relief . . . organization[]" is understood as a governmental entity providing aid or assistance to a population in need; and a "public . . . welfare organization[]" similarly pertains to a governmental entity formed for the purpose of providing financial or other assistance to individuals and communities in need. And, the payment provided by these organizations—the donation—must be a voluntary or charitable transfer of money to a recipient in need.   

Id. at *8.  The veteran argued unemployment compensation fit within this definition, but the Court determined otherwise.  Id. at *10.

The Court also considered if this would lead to an absurd result.  “Specifically, he asserts that it would be inconsistent to exclude from countable income compensation from CWT [Compensated Work Therapy], as outlined in 38 U.S.C. § 1718(g)(3), but not income from unemployment compensation because both constitute public relief for the unemployed.  The Court disagrees.”  Id. at *11.   The Court explained that it was “not persuaded that the two categories are so similar that unemployment compensation should also be considered a "donation" for NSC pension purposes and, as discussed above, the nature of the unemployment benefits reflects that those payments are not considered public relief.”  Id. at *13.

Decision by Judge Meredith and joined by Judges Pietsch and Toth. 

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Carpenter: Electronic Access for Law Firm Support Staff

Carpenter v. McDonough, Case Number 19-1136, decided February 24, 2021 involves how the VA provides electronic access to non-accredited law firm support staff.  The VA currently denies such access and the Court affirmed.

The VA uses a case management system called VBMS which provides an accredited agent or attorney who is representing a veteran, a look at the electronic claims folder.  The VA denies access to it to unaccredited paralegals and staff.  Two law firms with a deep history of VA benefits challenged the regulation, which resulted in this decision.  The Court accepted the VA’s decision to bar non-accredited law firm support staff from using VBMS finding the law firms had not proven they were prejudiced by such denial.

This is a decision with limited interested to most veterans, but in some capacity shows the Court will defer to a VA decision supported by a decent rationale.

Decision by Judge Falvey and joined by Judges Greenberg and Meredith. 

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Carr: Extending Transferred Education Benefits

Carr v. McDonough, Case Number 16-3438, decided February 19, 2021 involves a veteran who transferred a portion of his 48 months of education benefits to his daughter.  After using the benefits for two semesters, his daughter had only one day of eligibility left.  She sought to use 38 CFR Section 21.9635(o) to extend her benefits until the end of that semester.  The Board determined that 21.9635(y) prevented a transferee from receiving such an extension even though a veteran in the same situation was entitled to such an extension.

The daughter appealed arguing the regulation (21.9635) was inconsistent with the statute (38 USC Section 3319).  In a prior decision, the Veterans Court concluded 38 USC 3695  prevented veterans or transferees from receiving more than 48 months of benefits.  However, the Federal Circuit reversed that decision interpreting the phrase “may receive” as referring not to the amount of benefits a person “may receive”, but as a baseline limit on entitlement to benefits when combined under more than one chapter.  The Veterans Court then reconsidered the regulation question.

A veteran can receive 45 months of education benefits under chapter 34 and 36 months under chapter 33.  When a veteran receives benefits from more than one chapter, section 3695(a) provides a 48 month cap of total benefits.  However, if a veteran uses up chapter 33 entitlement during the middle of a semester, VA will provide financial assistance until the end of the semester.  38 C.F.R. § 21.9635(o) provides that "If an individual enrolled in an institution of higher learning that regularly operates on the quarter or 3 semester system exhausts his or her entitlement under 38 U.S.C. chapter 33, the effective discontinuance date will be the last day of the quarter or semester in which the entitlement is exhausted."

In this case, the veteran earned 45 months of benefits under chapter 34 and personally used 41 months and 11 days.  He returned to active duty and would have earned up to 36 more months, but section 3695 limited his total accumulated months to 48.  Thus, he earned another 6 months and 19 days.  He transferred his education benefits to his daughter who used a portion to pay for classes in the fall of 2010.  After a calculation error was discovered by the VA, it determined she had 19 additional days of eligibility, of which 18 were applied retroactively to the fall of 2010.  She applied the remaining day to her fall 2013 semester and sought to extend her benefits to the end of the semester.

The Board denied the argument relying on 38 C.F.R. § 21.9635(y), stating it decides the ending date of an award of educational assistance to a dependent who exhausts the entitlement transferred to him or her is the date he or she exhausts the entitlement.

The Court started by saying:

Ms. Carr argues that VA's regulation is invalid because it treats veterans and dependents differently and so conflicts with its enabling statute. Specifically, Ms. Carr contends that, by discontinuing her educational assistance benefits immediately upon her exhaustion of entitlement, § 21.9635(y) prevents her from using her educational benefits in the same manner as a similarly situated veteran, thus violating the authorizing statute for the regulation, 38 U.S.C. § 3319(h)(2). Section 3319 is the only authority cited for subsection (y). See 74 Fed. Reg. 14,654, 14,684 (March 31, 2009). On this basis, Ms. Carr has requested that the Court declare subsection (y) invalid as inconsistent with the law enacted by Congress.

Id. at *3-4.

After a close textual reading, the Court determined:

Because § 21.9635(y) prevents transferees from using the statutory extension provision enjoyed by veterans (as recognized in § 21.9635(o)), § 12.9635(y) arbitrarily restricts the manner in which a transferee is entitled to educational assistance benefits. Therefore § 21.9635(y)'s exhaustion provision conflicts with subsection (h)(2) of its authorizing statute and is invalid.

Id. at *8.

This is a helpful decision for individuals who received transferred benefits and puts them on the saying playing field as the veteran they received the benefits from.

Decision by Chief Judge Bartley and Judges Pietsch and Toth. 

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