Shorette v. McDonough, Case Number 23-7775, decided September 20, 2024 delves into the abuses of the VA Fiduciary Program.
The petitioner was the spouse of a veteran who had served as her husband’s VA fiduciary and was removed by the VA. From 2008 until 2018 she had served and allocated approximately $3,000 per month toward family expenses for the veteran’s dependents. However, she was removed after a medical record suggested she was misusing the veteran’s funds. When a successor fiduciary was appointed, no benefits were allocated for his dependents and family expenses.
Three years later, in 2021, the VA determined their had been no misuse of funds and did not restore the wife as the fiduciary and ignored her appeal, as guardian under state court order, of VA’s appointment of a paid fiduciary. Finally, the VA’s inaction resulted in a request that the Court order the VA to o (1) issue a decision regarding her entitlement to be reinstated as representative payee for Mr. Shorette, (2) address her complaints that his then-current fiduciary was violating a July 2010 fiduciary agreement in which VA approved monthly expenses to support the veteran's family, and (3) release the withheld funds. Id. at *1.
After an oral argument, the Court ordered the VA to process the NOD. Additionally, the petitioner tried to resolve the familial expenses issue with the VA. Finally, in December 2023, the petitioner filed another petition because the VA ignored her requires for the VA’s fiduciary file, still had not process her 2018 NOD, and had not address the familial expenses issue. As to the familial expenses issue, the VA argued that the paid fiduciary had all control.
Next, the VA found the surviving spouse and veteran were estranged because they did not live together and thus could not be treated as a spouse fiduciary, which is less cumbersome. In fact, they did not live together because the veteran was a nursing home.
At the same time the VA in response to one argument stated “the fiduciary must provide evidence that reimbursement is warranted before VA will authorize a reimbursement of funds.”
The Court then noted that at oral argument
“VA admittedly erred in 2018 when it determined that Mrs. Shorette misused the veteran's funds, and the undisputed facts reflect that VA compounded that error over the next 6 years by ignoring Mrs. Shorette's complaints and failing to ensure that the prior paid fiduciary was fulfilling his duties to assess the welfare and overall financial situation of the veteran's dependents. In that regard, counsel for the Secretary could not offer any reason why the fiduciary budget for familial expenses was reduced from roughly $3,200 per month to zero, other than an unfounded allegation that the petitioner refused to comply with a field examination, and counsel was unable or unwilling to say that VA will not investigate Mrs. Shorette if she reimbursed herself with those funds that would not have accumulated in the veteran's managed account but for VA's or the prior fiduciary's errors.”
Id. at *7.
The Court ordered the Secretary to file a memorandum explaining why the VA will not make a preemptive decision that it will not initiate a misuse determination or seek to remove the spouse as fiduciary if she reimburses herself the amount of familial expenses that was in the initial budget but was never paid.
While the entire VA claims process can be byzantine, the VA’s fiduciary program makes the rest of the VA look like quick and accurate justice. The fiduciary program is simply the worst process I’ve ever heard of at the VA. It should reiterate that any veteran who can, should avoid it if possible. I am frankly shocked that the Veteran’s Court did not go further in its order and direct more forceful action.
Per Curiam decision by Chief Judge Bartley, Meredith and Laurer.
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