Fournier: When is a Denial a Denial?

Fournier: When is a Denial a Denial?

The case of Richard C. Fournier v. Eric K. Shinkseki, Opinion Number 08-1087, decided June 18, 2010, affirmed a denial of an earlier effective service-connection date.

The facts are simple. The veteran had served for approximately 5 years when while walking on the street near his base he was hit on the head during an assault. He was subsequently honorably discharged for unsuitability based on having an inadequate personality disorder. The veteran was ultimately service-connected for a mood disorder secondary to a head injury but was seeking an earlier effective date based on a filing in 1971. Importantly, he had initially filed for service-connection in 1968 and again in 1971 before finally being connected after a 1980 filing.

The veteran argued the 1971 denial was defective based on reasons of notice and thus still pending. Specifically, the veteran argued the 1971 denial was so misleading as to fail to notify him of the reason for disallowing the claim and further that the RO should have had a duty to read the claim for a nervous disorder sympathetically to include psychoneurotic disorders. The argument essentially boiled down to saying a better explanation of the denial would have allowed the veteran to know what evidence he needed to substantiate his claim. The problem was that this was a duplicate claim in that a claim had been denied in 1968 and the veteran had not submitted any new evidence.

The Court rejected the claim and focused the question of a pending claim on law which states a claim remains alive until there is either a recognition of the substance of the claim in an RO decision from which a claimant could deduce that he claim was adjudicated or an explicit adjudication of a subsequent claim for the same disability. The Court then determined the 1971 claim denial letter clearly complied with then existing regulations and that a reasonable person would have not have delayed filing an appeal of the decision. The Court then elaborated on the sympathetic reading requirement to say it does not “obligate [the VA] to read a claimant’s mind.”

The case also involved language from the M21-1 manual which required a formal rating decision setting forth the denial; however, the Court found the language applied to claims requiring reconsideration, new and material evidence, or increased ratings and that this claim was merely duplicative without presenting new evidence.

The Court used the opportunity to clarify its view of the M21-1 manual. It repeated that the manual can result in either substantive or interpretative rules, with substantive rules being ones the VA has to follow. This is in contrast to the VA which likes to see the manual as merely interpretative. Of course, whether a rule is substantive or interpretative is essentially a call for the Court which will be guided by looking to see if the manual “created” additional rights beyond those of preexisting regulations on the same subject. Here, the Court held the manual provision did not establish or alter the criteria for benefits but illuminated a suggested procedural practice (issuing a formal rating decision); therefore, the manual provision does not limit the agency’s action.

Decision drafted by Chief Judge Greene and joined in by Judges Hagel and Davis.

Raugust: VA Medical Benefits and the 24-Month Rule

Raugust: VA Medical Benefits and the 24-Month Rule

The case of Richard C. Raugust v. Eric K. Shinkseki, Opinion Number 08-2064, decided June 11, 2010, was a matter of first impression where the Court affirmed the constitutionality of the 24-month minimum service requirement.

The veteran served for 17 months and 25 days before receiving an honorable discharge. The Court noted the reason for his separation was for “misconduct – pattern of misconduct”. The veteran requested access to VA health care benefits but was denied because of the 24-month minimum service requirement. This rule which was established by Congress only applies to those who enlisted after September 7, 1980, and requires an individual serve at least 24 continuous months of active duty to qualify for any VA benefits. Importantly, there are some exclusions from the 24-month minimum service requirement, which include: discharge based on hardship or early discharge agreement or due to a disability.

The veteran appealed on two grounds: a failure to assist and a constitutional challenge to the rule.

Regarding the failure to assist, the Board admitted it did not find the duty to assist satisfied but instead said any deficiencies are moot because no reasonable possibility exists that additional records would substantiate the claim. The veteran argued the service records might have addressed some of the exclusions to the 24-month minimum service requirement. The Court admitted that conceivably records could address an exclusion, but then pointed to the fact there was “no specific reason to believe” records would reveal an exclusion because the veteran had not made a specific and credible allegation that an exclusion would be established by the records. The Court found without a specific and credible reason to believe the additional records would tend to establish an exception, the Board did not commit clear error in concluding there was no need to obtain additional records.

Regarding the constitutional challenge, the veteran argued the 24-month minimum service requirement violated the guarantee of equal protection. The argument was that the provision created an arbitrary absurdity because only fractionally longer or shorter service could determine eligibility. The Court properly assessed under equal protection clause jurisprudence and found a rational basis for the creation of the 24-month minimum service requirement, reduction of attrition.

The problem with this decision is that the Court seems to have forgotten the VA duty to assist is founded upon the principle that the system is proudly non-adversarial and gives the benefit of the doubt to the veteran. The result is a large number of veterans are unrepresented prior to the case reaching the Court. What happens to an attorney that looks at the case and realizes the veteran has a good argument for fitting within an exclusion to the 24-month minimum service requirement but that the records are not a part of the record and the veteran did not know to make the argument earlier? Should he just tell the veteran to start over or can he rely on the fact that the VA did not fulfill the duty to assist and use that failing to get the case sent back to the Board to address the information and arguments he has found?

In that vein, perhaps the lesson to a veteran is to find representation before you reach the Court of Appeals. Of course, we can hope the Federal Circuit Court of Appeals gets its crack at the case and re-imposes on the VA and the Court of Appeals for Veterans Claims the inviolate requirement of the duty to assist.

Decision drafted by Judge Hagel and joined in by Judges Moorman and Lance.

King v. Shinseki: What Does It Take To Reopen A Claim?

King: What Does It Take To Reopen A Claim?

The case of Earlee King v. Eric K. Shinseki, Opinion Number 07-1214, decided May 28, 2010, affirmed a denial for an earlier effective date for service connected schizophrenia.

The veteran was initially denied service connection by the VA in 1992 and the Board in 1993. Thereafter he continued to be treated by the VA. The veteran was finally granted service connection and a 100% disability rating going back to 2000. However, medical notes from prior to 2000 discussed his schizophrenia and a specifically a 1997 medical report noted the veteran told the physician he wanted to file a claim for service connection for his schizophrenia. The veteran sought to use this notation as proof that he had reopened his claim and should be granted an earlier effective date.

The majority found these notations “failed to manifest the requisite intent to reopen a previously denied schizophrenia service-connection claim” and “the VA examiner’s suggestion to Mr. King in December 1997 that he file a service-connection claim reveals that neither party had reason to believe that any claim had been presented”.

A dissent by Judge Hagel argues that there are only three requirements to be fulfilled to file an informal claim: (1) written communication, (2) an intent to apply for benefits, and (3) identifying the benefits sought. Judge Hagel then argues that all three requirements were fulfilled in that the physician rendered the communication into writing and the veteran intended to apply for a benefit, service-connection for schizophrenia. Essentially Hagel argues it is not important who writes an informal claims, the veteran, a representative, or even as in this case a VA physician and that the majority got it wrong when it measured intent and found King did not intent to seek benefits.

The majority’s reasoning is troublingly incomplete. They denied based on the veteran lacking intent to apply for benefits because the physician told him that he should file for service-connection, this is problematic because the measure of intent is the veteran’s at the time of the request and not the physician’s intent or what the veteran should have known after being instructed by the physician. Either King intended to request benefits when talking to the VA physician or he did not.

Perhaps the Court could have gotten out of the subjective intent question by more strictly policing the “written requirement”, however, a strong counterargument could be made that the physician (due to the close doctor-patient relationship) was acting as the veteran’s representative when filling out the form. Still, I am sympathetic to the Court and the VA in that allowing VA physician notes to be used to seek an earlier effective date could open a can of worms in light of the inherently different roles of the VA physician and VA ratings adjudicator.

The lesson from the case is that if you want to reopen a denied claim, due so in writing and for that matter make sure you keep a copy.

Decision by Chief Judge Green and Judge Davis with a dissent by Judge Hagel.

DIC: What is Intentional and Wrongful

DIC: What is Intentional and Wrongful

The case of Keith A. Roberts v. Eric K. Shinkseki, Opinion Number 06-2699, decided May 17, 2010, remanded a denial for DIC.

This remand occurred after the Court of Appeals for the Federal Circuit vacated and remanded and a decision by the court which affirmed denial of disability and indemnity benefits to a woman because she killed her husband, the veteran.

The woman had entered a plea of nolo contendre and been found guilty of manslaughter. 28 C.F.R. section 3.11 prohibits receipt of any DIC benefits for someone who intentionally and wrongfully caused the death of the veteran. The case was reversed because in Florida (the site of the crime and plea) intent is not necessarily an element of manslaughter, and the Court required that the VA make a factual determination as to whether a possible beneficiary intentionally or wrongfully caused the death.

Many States do not require intent for manslaughter which means the VA can not simply deny a claim based on the conviction but must make a further factual determination regarding intentionality and wrongfulness.

Decision by Judges Kasold, Davis and Schoelen.

Roberts: Severing Service Connection Based on Fraud

Severing Service Connection for PTSD Based on Fraud

The case of Keith A. Roberts v. Eric K. Shinkseki, Opinion Number 05-2425, decided April 23, 2010, affirmed the severing of service connection for PTSD based on fraud.

Here, the Board had severed service connection for PTSD based on fraud and clear and unmistakable error. Additionally, they denied service connection for a number of ailments that were alleged to have been secondary to the PTSD. Finally, the Board denied service connection for dysthymia and depression.

The Court largely affirmed by affirming the severance of service connection and denial of service connection on any secondary theory, while reversing as to depression and dysthymia because the Board had not considered whether they were directly related to service.

Factually, the veteran claimed that he witnessed his friend’s death in an accident while working on an airplane and led the efforts to try to save his friend. However, at some time the veteran had filed a complaint with the VA Office of Inspector General regarding VA mishandling of his claim. The Office of Investigations investigated and found that the veteran was not actually a witness to his friend’s death and according to other witnesses not even a friend to the decedent.

The Court found the veteran had committed fraud. The Court closely looked at sections 3.105, 3.957, and 3.500. If service connection has existed for 10 years the VA generally cannot sever service connection. However, the Court found “when fraud is found to have formed the basis for an award of service-connected benefits, regardless of the length of time a claimant has been in receipt of these benefits, severance of the award can be made upon a showing of fraud.”

Judges Hagel wrote and Schoelen joined in a concurring and dissenting opinion. In it, Judge Hagel saw the issue of this case as the fair process of adjudication of the claim. Basically, they disagreed with the failure to provide 3.105(d) protections. These are essentially notice of reasons of severance and allowing a beneficiary 60 days to present evidence. Additionally, 3.105(d) shifts the burden to the VA and requires clear and unmistakable error in the original rating decision.

Judge Hagel also expressed concern regarding the impact of the Court’s action on a situation such as this one where the veteran claimed various PTSD stressors but the VA only awarded on one of them. He wrote that “I believe that-certainly before VA may sever service-connection in a case such as Mr. Roberts’-where VA is aware of other stressors that could serve as a basis for continuing the award of post-traumatic stress disorder, VA must consider the validity of the other potential stressors. After such review, if VA determines that the accumulated evidence regarding another potential stressor is not adequately developed, it should be take appropriate steps to further develop that evidence.”

He also called into question the adequacy of the medical examination which found the veteran did not have PTSD. The examination basically found that because the stressor was no longer considered valid, the veteran could not possibly have PTSD. Notably, the examination did not discuss other possible stressors. Disturbingly, the VA tabbed what it considered to be “pertinent evidence” while saying the “much of the other documentation consists of duplicate copies of the claims folder.” Judges Hagel and Schoelen found a medical examination undertaken in such a manner did not meet standards of basic fair play (that evidence be procured in a manner that is impartial, unbiased, and neutral).

The case is difficult because the bad actions by the veteran make it understandable that the Court and VA would reach a conclusion of severance. However, Judges Hagel and Schoelen certainly raise important objections, especially as to the potential duty to develop other stressors that were raised at the original during the initial claim and concerns over the impartiality of the medical examination. This might be an example of bad facts making bad law.

Decision by Judge Greene, with a dissenting opinion by Judge Hagel and joined in by Judge Schoelen. And, a concurring opinion by Judge Lance..

Posey: The Misfiled Notice of Appeal and the VA's Duty

The Misfiled Notice of Appeal and the VA’s Duty

The case of Robert V. Posey v. Eric K. Shinkseki, Opinion Number 08-0240, decided April 23, 2010, concerns an improperly filed notice of appeal and is another extension of a line of cases arising from the Court’s 2009 decision in Irwin v. Shinseki and coming on the heals of William C. Rickett v. Eric K. Shinseki, Opinion Number 09-2493, decided March 17, 2010.

This is one of a long line of cases that deals with a possibly improperly filed notice of appeal. Here, the VA had sent a BVA decision to the wrong address and resent it to the correct address apparently two months later. The veteran sent a letter to the VA 114 days after the decision was apparently resent. The VA interpreted the letter to be a notice of appeal. The letter was received by the VA on November 8, 2007 and forwarded to the Court of Appeals on January 19, 2008. By the time the letter was received at the Court of Appeals, more than 120 days had elapsed, meaning the purported notice of appeal was untimely.

The Court called the VA to task for waiting over 2 months to forward the purported notice of appeal to the Court and instead determined that the document was not a notice of appeal but a motion for reconsideration directed to the BVA. This effectively meant the motion for reconsideration tolled the finality of the BVA decision and meant that the BVA had to render a decision on the motion to reconsider before the notice of appeal had to be sent.

The Court considered the document a motion to reconsider because it requested a Board hearing in Washington, DC, had attached a VA form 1-9, was directed to the Board of Veteran Appeals in salutation, and does not in its body refer to the Court.

The Court further dealt with a side issue regarding the presumption of regularity of the Secretary’s actions before two concurring opinions took the VA to task for possibly sitting on a notice of appeal to “run…out the clock.”

Judge Hagel said “it has become clear to me that VA somewhat routinely holds correspondence from claimants that it determines, sometime after receipt, are Notices of Appeal to this Court. As a result, in far too many cases, the Court receives the Notices of Appeal from VA only after the 120-day appeal period has expired.” Judge Hagel suggested that Congress address this issue by amending 38 U.S.C. Section 7266 (regarding Notices of Appeals) to say that if it is sent to the VA during the 120-day appeal period that it will be regarded as a motion for reconsideration.

Judge Lance also wrote a separate concurrence wherein he noted the problem and stated, “The perception [that the VA is willfully failing to return or forward the purported notices of appeals in a timely manner] will persist until such time as the Secretary develops uniform practices and procedures dealing with misfiled NOAs…. Of course, the Secretary, if he elects, can merely return the misfiled NOAs within a reasonable amount of time and advise veterans to perfect their appeal in a timely manner with instructions as to where to send their NOA.” The judge noted that while it is ultimately the Secretary’s responsibility to develop practices to take care of the misfiled NOAs, “it is this Court’s obligation to ensure that rights and protections given to veterans by Congress and a grateful citizenry are effectuated in the spirit as well as letter of the law”. Judge Lance then noted it is appropriate in some circumstances for the Court to construe misfiled NOAs that are not timely and appropriately addressed by the Secretary as a request for reconsideration by the Board or in the alternative that the Secretary’s actions can result in waiver of the technical requirements associated with filing an appeal.

While this decision is not an ultimate resolution of the problem of misfiled NOAs, it does represent a significant signal to the VA that the Court is concerned about a possible pattern by the VA of not adequately addressing misfiled NOAs and that the Court (especially Judges Lance, Hagel, Kasold (see his dissent in Rickett) and Schoelen) might be willing to assist a veteran who has misfiled a NOA.

Decision by Judges Hagel, Lance and Schoelen, with separate concurrences by Hagel and Lance.

Osbon: Overbilling?

Overbilling?

The decision Michael J. Osbon v. Eric K. Shinseki, Opinion Number 09-0824(E), decided April 23, 2010, drastically reduced an EAJA request.

This case probably is only interesting to attorneys and has limited appeal to appellants, because while attorneys who work in the veterans’ benefits arena do so because it is an awarding area where you can help people, they also have law offices and families to support. This decision deals strictly with the amount of an EAJA award.

The attorney secured a benefit to his client by securing a Joint Motion for Remand and no one disagreed that he was entitled to an EAJA award. The problem was the amount. It was a single issue case with said issue being TDIU. The attorney submitted an EAJA application for $8,222,55, which accounted for 40.4 attorney hours and 21.2 paralegal hours. The Secretary objected and the attorney did not reply to the Secretary’s response.

Numerous objections were raised by the Secretary including: (1) time spent on clerical tasks (copying, preparing, reviewing and mailing appeals documents to the client), (2) spending excessive time preparing and mailing standard documents, and spending excessive time receiving documents, (3) billing excessively for “simple tasks and receipt of routine documents”, (4) unreasonable and excessive billing for repetitive paralegal acts, (5) spending too long to review the record for counter-designation, (6) excessive and duplicative time spent reviewing and annotating the Record Before the Agency, (7) vague descriptions of attorney time, (8) unreasonable billed for corrective actions take pursuant to the attorney’s own delay, (9) excessive and duplicative time on the EAJA application, 11.8 attorney hours and 5.2 paralegal hours.

The Court agreed with the Secretary that time was billed that was clerical, unreasonable excessive or duplicative, and inefficient in requiring corrective documents. The Court also discounted all paralegal time because the EAJA application did not contain a statement of the paralegal’s qualifications and experience. But, what really seemed to upset the Court was the amount of time billed for the EAJA application. They noted it was basically boilerplate and yet in other applications submitted by the attorney he had billed a similar amount. The Court was also upset that the attorney charged what it considered to be an excessive amount of time to assemble, calculate, and check the time and billing statements. The Court seemed to say that if the times had been kept contemporaneously with the acts that the amounts would have been less. The end result was that the Court reduced by 80% the award to $1,372.80.

This is a tough case to judge. Surely some of the billing does not seem to be as problematic as the Court found. For instance, I am not sure that preparing documents for a client is clerical. Also, billing .1 for receiving and reviewing a document is not out of line with private practice. I also wonder what is an appropriate time to review and annotate the Record Before the Agency? Many practitioners have found that by going page by page they come across something the VA did not consider, this is necessarily a time consuming task.

Still, the Court seemed to be motivated by anger, probably by what it considered the excessive amounts of time spent preparing a largely boilerplate EAJA application and the fact that it was similar to amounts from other applications.

All in all, it seems like a case that reinforces the need to (1) keep contemporaneous and descriptive time records, (2) show some discretion by reducing or eliminating some mundane tasks (perhaps combine some of the smaller tasks into a larger listing and only bill .1) and never billing the government for work that is required because of you (i.e., billing for time spent when you request an extension), (3) and remember that it is the person seeking the award who has the burden to show that the fee request is reasonable.

As a young attorney I worked at an insurance defense firm that refused to bill its clients for fancy lunches. We might be out of town for a deposition and all the other attorneys going out to a nice lunch spot but the firm took the position that we were going to eat anyway and the client should not have to pay for it. The result was that I paid for a lot of my own lunches when other attorneys were expensing their clients. However, we always had plenty of good work to do while I was employed with that firm and I think our clients appreciated the fact that we did not just see them as an unlimited ATM.

With this decision, the Court is reminding all of the attorneys who practice before it that we should and will be paid for our work but that they are not paying for any fancy lunches.

Decision by Judge Hagel.