Fuller v. McDonough, Case Number 18-7000, decided February 23, 2022 discusses the ability for a veteran to challenge an effective date for spousal apportionment for the spouse.
The veteran filed an appeal asking for an earlier effective date for apportion of VA benefits to his spouse. It specifically considered whether California community property law conferred standing on Mr. Fuller to pursue this appeal. The Court determined: “that as a consequence of his intact marriage to Ms. Fuller, the lack of evidence of planned marital dissolution, the fact that the claim at issue will benefit both spouses, their mutually expressed unity of interest in the pursuit and outcome of the earlier effective date claim, and the economic injury to their community property sustained by VA's denial of an earlier effective date for the apportioned benefits, Mr. Fuller has standing to pursue the appeal.”
Mr. Fuller was married and was granted a disability rating, but a portion was withheld because he was incarcerated. The 2004 notification letter informed him his dependents may be entitled to apportionment of the withheld portion. The veteran than filed a declaration of status of dependents resulting in the VA sending a letter to his wife and notifying her of the right to file an apportionment claim and seeking verification of her income and expenses. It appears she did not respond to the VA’s letter.
Approximately 5 years later, the veteran provided the VA with an updated address for his the wife, which indicated his belief she was receiving apportionment of his benefits. Meanwhile, within days of that letter, his wife expressed her desire to file for apportion from any benefits due.
The VA sent the veteran a letter acknowledging the request for apportionment and asking for further information. The veteran responded by a letter expressing his belief apportionment had occurred already. Finally, the VA established an apportionment in 2009 with a 2009 effective date. The veteran filed a NOD requesting an earlier effective date. The claim was remanded by the Board because it was not apparent the wife had received a copy of the SSOC or been told of the hearing. Notice was given to the wife and then the Board remanded again for the RO to address whether the veteran had standing to file a NOD on behalf of the spouse. The RO and Board next determined the veteran did not have such standing. The result was a Court appeal and remand for the RO to address whether the veteran was authorized to file an NOD as to the apportionment effective date.
The Board ultimately admitted the veteran’s standing but said a claim for apportionment was not submitted until 2009.
On appeal, the Court agreed with the issue of standing based on the fact California is a community property state. “Put plainly, in a community property system spouses jointly own all property created or acquired during the marriage, regardless of which spouse earned that property.” The Court distinguished this case from separation or divorce cases: “Simply put, the USFSPA, Mansell, and Howell do not apply in this case. Mr. and Ms. Fuller were married at the time that Mr. Fuller was first awarded benefits; married when Mr. Fuller first identified Ms. Fuller as a dependent eligible for an apportionment of his benefits during his incarceration; and their marriage has continued, including the period during which Mr. Fuller appealed to this Court. Unlike in Mansell and Howell, where veterans in the context of divorce proceedings asserted a property interest that was diametrically opposed to their former spouses' financial interest, the Fullers have an intact marriage, they have jointly asserted entitlement to an earlier effective date for apportionment, and Mr. Fuller is not asserting a property interest in opposition to Ms. Fuller's.”
After determining the veteran had standing, the Court turned to the merits (proper effective date). This portion turned on the presumption of regularity. The Court explained: “The Board considered the Fullers' assertion that Ms. Fuller did not receive the April 2004 VA letter, as well as her statement that she had no contact from VA until 2009. However, the Board applied the presumption of regularity, concluded that VA in April 2004 properly sent Ms. Fuller notice of her right to apportionment, and determined that the presumption was not rebutted by clear evidence to the contrary.”
The veteran essentially argued he erroneously gave the VA an incorrect address for his wife due to his incarceration. The Court accepted this argument finding a reasons and bases error and explained: “The Board considered the Fullers' assertion that Ms. Fuller did not receive the April 2004 VA letter, as well as her statement that she had no contact from VA until 2009. However, the Board applied the presumption of regularity, concluded that VA in April 2004 properly sent Ms. Fuller notice of her right to apportionment, and determined that the presumption was not rebutted by clear evidence to the contrary.”
The Court even noted “the troubling opportunities for error in the establishment and development of apportionment claims, as evinced by the Fullers' experience.” The Court focused on the fact the VA relies on the veteran to provide an address for the person who might seek apportionment and noted “Such a system evokes fair process concerns.”
This decision is a blueprint for challenging a failure to apportion earlier.
Judge Allen dissented explaining based on a lack of standing focusing on a lack of statutory right to appeal to the Board and a lack of a legally cognizable interest in his wife’s apportioned benefits.
Decision by Chief Judge Bartley and Greenberg. Dissent by Judge Allen.
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