Citation Nr: 0002363	
Decision Date: 01/31/00    Archive Date: 02/02/00

DOCKET NO.  99-25 147	)	DATE
	)
	)


THE ISSUE

Payment of attorney fees from past-due benefits.


INTRODUCTION

The veteran had active service from November 1986 to April 
1991.


FINDINGS OF FACT

1.  On Department of Veterans Affairs (VA) examination in 
July 1991, a diagnosis of "postural lumbosacral strain 
related to limping from knee disease" was made. 

2.  In a January 1994 Board of Veterans' Appeals (Board) 
decision reference to the lumbar spine disability was not 
made.  Notice of disagreement leading to that decision was 
received subsequent to November 18, 1988.

3.  In February 1994 the veteran appointed W. G. S. as his 
attorney; the parties entered into a fee agreement.

4.  In May 1995, the United States Court of Appeals for 
Veterans Claims (the Court) vacated the Board's January 1994 
decision and remanded the matter for further proceedings, 
thereby granting the joint motion for remand which indicated 
that the Board should consider whether a claim of secondary 
service connection for the veteran's back disorder had been 
raised by the record, and if so, proceed to adjudicate the 
claim or refer it for appropriate development.

5.  In a September 1995 remand, the Board asked the Regional 
Office (RO) to ascertain whether the veteran wanted to reopen 
a claim for service connection for a low back disability or 
whether he wanted to pursue a new claim.  That same month, 
the veteran indicated that he wanted to pursue the claim.  

6.  In a January 1997 Board decision, the low back disorder 
claim was not addressed, and in February 1997, the veteran 
and W. G. S., enter into a modified fee agreement, wherein 
the parties agreed that upon favorable resolution of the 
appeal the attorney fee would be based upon a contingency fee 
of 20 percent resulting from any past due benefits.  

7.  In February 1998, the Court vacated the January 1997 
Board decision and granted a joint motion for remand to, 
inter alia, determine whether the claim for service 
connection for a lower back disorder on a direct basis had 
been reopened and to allow the veteran the opportunity to 
perfect his appeal.

8.  In a July 1998 remand, the Board asked to RO to ascertain 
whether the veteran wished to pursue the low back disorder 
claim.  

9.  By a letter dated July 31, 1999, W. G. S. withdrew power 
of attorney.

10.  In September 9, 1999, the RO granted service connection 
for lumbosacral strain with disc disease disability.

11.  In the Matter of Fee Agreement of W. G. S., the February 
1997 fee agreement is reasonable, with respect to payment of 
a contingency fee of 20 percent based upon the grant of 
entitlement to service connection for lumbosacral strain with 
disc disease rated at 10 percent, effective from May 1, 1991.

12.  On September 21, 1999, the veteran appointed D. D. W. as 
his attorney and the parties entered into a fee agreement, 
agreeing that upon favorable resolution of the appeal the 
attorney fee would be a contingency fee of 20 percent from 
any past due benefits awarded.  

13.  In the Matter of Fee Agreement of D. D. W., payment of 
attorney's fees in the amount of 20 percent resulting from 
the grant of service connection for residuals of a 
lumbosacral strain, evaluated at 10 percent, effective May 1, 
1991, are excessive and unreasonable.  The veteran and D. D. 
W. entered into a contractual agreement after benefits were 
granted.


CONCLUSIONS OF LAW

1.  The criteria under which a valid fee agreement between 
the veteran and his attorneys as to representation before VA 
may be executed have been met.  38 U.S.C.A. § 5904(c) (West 
1991 & Supp. 1999); 38 C.F.R. § 20.609(c) (1999).

2.  In the Matter of the Fee Agreement of W. G. S., the 
criteria for eligibility for direct payment of attorney fees 
by VA from past-due benefits, arising from the grant of 
service connection for lumbosacral strain with disc disease, 
have been met.  38 U.S.C.A. § 5904(c) (West 1991); 38 C.F. § 
20.609(h) (1999).

3.  The fee specified in the agreement as being payable 
directly to the attorney by VA, and amounting to no more than 
20 percent of past-due benefits awarded to the veteran is 
reasonable.  38 U.S.C.A. § 5904(d) (West 1991); 38 C.F.R. § 
20.609(f), (h) (1999).

4.  In the Matter of the Fee Agreement of D. D. W., the fee 
agreement, to the extent that it provides that attorney fees 
in the amount equal to 20 percent of past-due benefits 
resulting from the grant of service connection for a 
lumbosacral spine disability, evaluated at 10 percent 
effective from May 1, 1991, is excessive and unreasonable.  
38 U.S.C.A. § 5904(c) (West 1991 & Supp. 1999); 
38 C.F.R. § 20.609(c) (1999).


REASONS AND BASES FOR FINDINGS AND CONCLUSIONS

Background

In November 1991, the RO granted service connection for 
chondromalacia of the knees, rated as noncompensably 
disabling effective May 1, 1991.  Service connection for a 
low back disability was denied.  In November 1991, the 
veteran filed notice of disagreement.  A statement of the 
case was issued in January 1992 and the veteran filed a 
substantive appeal in March 1992.  

In January 1994, the Board denied entitlement to a 
compensable evaluation for chondromalacia of the knees and 
entitlement to a compensable evaluation under the provisions 
of 38 C.F.R. § 3.324.  In February 1994 the veteran appointed 
W. G. S., an attorney, as his representative and the parties 
entered into a fee agreement.

The veteran thereafter appealed to the Court.  In 
[citation redacted], a Court Order, 
the Court vacated the Board's January 1994 decision and 
granted a joint motion to remand and to stay further 
proceedings.  In the joint motion to remand, the parties 
stipulated that "the Board should consider whether a claim 
of secondary service connection for Appellant's back has been 
raised by record, and if so, proceed to adjudicate the claim 
or refer it for appropriate development." 

In September 1995, the Board remanded the case to the RO for 
additional development, to include the scheduling of an 
orthopedic examination, to readjudicate the increased rating 
issue, including consideration of the provisions of 38 C.F.R. 
§ 3.324, and to ask the veteran to provide clarification 
indicating whether he wanted to reopen a claim for service 
connection for low back disability or whether he wanted to 
pursue a new claim for service connection for low back 
disability based on aggravation resulting from service-
connected disability.

In September 1995, the veteran, through W. G. S., told VA 
that he wanted to pursue the claim of service connection for 
a low back disability.  In May 1996, the RO deferred 
adjudicating the claim of service connection for the low back 
disability, but increased the rating for the bilateral 
chondromalacia disability from zero to ten percent, effective 
from May 1, 1991, which rendered the issue of a compensable 
evaluation for multiple noncompensable service-connected 
disabilities moot.  In July 1996, the veteran, again through 
W. G. S., disagreed with the assigned rating.  

In a January 30, 1997, decision, the Board denied the 
veteran's claim for a rating in excess of 10 percent for 
bilateral chondromalacia.  The Board did not reference the 
low back disability.  The veteran once again appealed to the 
Court.  

In February 1997, the veteran and W. G. S. entered into a 
modified Attorney-Fee Contractual Agreement.  The parties 
agreed that the VA would pay to the attorney 20 percent of 
past-due benefits awarded on the basis of the claim.  In the 
discharge and withdrawal section, the parties agreed that the 
client may discharge the attorney at any time and attorney 
may withdraw with client's consent or for good cause.  
Thereafter some factors indicative of good cause were listed.  
The parties also agreed that if the attorney withdraws before 
completing his duties under the contract, the client may be 
entitled to a refund of some or all of the fixed fee, if any, 
depending on the facts and circumstances.  Reference to the 
contingency fee was not made.

The Court, in a February 1998 Order, vacated the Board's 
January 1997 decision, and in so doing, remanded the case to 
the Board for certain action pursuant to the parties February 
1998 joint motion for remand.  In the joint motion, the 
parties, among other things, found that a remand was 
necessary to determine whether the veteran's claim for 
service connection for a lower back disorder on a direct 
basis has been reopened and to allow the veteran an 
opportunity to perfect his appeal from the August 1996 RO 
decision denying service connection for a low back disorder 
on a secondary basis.  

The parties explained that the infirmity with the post-remand 
treatment regarding the issue of service connection for a 
lower back disability existed because the Board remanded the 
veteran's case to determine if he sought to pursue a claim 
regarding a back disability either as (1) an attempt to 
reopen a previously denied claim or as (2) a new claim of 
entitlement to service connection for a back disability on a 
secondary basis.  The record did not indicate that the RO 
made these determinations.  Instead, the RO determined that 
no new and material evidence had been presented to reopen a 
claim for a lower back disability on a secondary basis and 
denied service connection.  Thereafter the veteran, through 
counsel, disagreed with this decision.  However, a SOC was 
not issued and the veteran was unable to perfect his appeal.  
38 C.F.R. §§ 20.200, 20.201; see also 38 C.F.R. § 20.202.  
Accordingly, in its subsequent decision, the Board did not 
address the lower back disability claim.

In July 1998, the Board again remanded the issue of 
entitlement to an increased rating in excess of 10 percent 
for bilateral chondromalacia.  In the remand, the Board asked 
the RO to contact the veteran for the purpose of determining 
whether he wanted to reopen a previously denied claim for 
service connection for a lower back disability and, if so, to 
take appropriate action to adjudicate such a claim.  The 
Board also noted that the veteran and his attorney should be 
furnished with a SOC for the RO's August 1996 decision, 
determining that no new and material evidence had been 
presented to reopen the service connection for a low back 
disability claim, and afforded the applicable opportunity to 
respond.  

In June 1999, the veteran, via counsel, again indicated that 
he wanted to pursue the low back disability claim.  By a 
letter dated July 31, 1999, however, the veteran's attorney 
canceled power of attorney.  W. G. S. stated "[e]ffective 
immediately, the Power of Attorney is canceled [and] the 
claimant has been notified of this cancellation."  The 
record thereafter indicates that W. G. S. died on 
August [redacted], 1999.  

In a rating action dated September 9, 1999, the RO granted 
service connection for lumbosacral strain with mild L5 disc 
disease (pursuant to 38 C.F.R. § 3.105(a)), and rated the 
disability at 10 percent effective May 1, 1991.  The issue of 
entitlement to an increased evaluation in excess of 10 
percent for bilateral chondromalacia was deferred pending 
additional development.

On September 21, 1999, the veteran appointed D. D. W. as his 
attorney and at the same time the parties entered into a fee 
agreement.  The parties stipulated that the veteran's 
objectives were to obtain an increased rating in excess of 10 
percent for his service-connected bilateral chondromalacia; 
to obtain service-connected disability benefits for a low-
back disorder; and any other benefits to entitlement which is 
reasonably inferred from the record.  The fee agreement also 
stated that it superseded all prior agreements, and the 
following:

Attorney is undertaking prosecution of 
the claims described . . . [therein] that 
ha[d] been continuous since the 
January 11, 1994, BVA decision.  However:  
The client expressly agrees that if the 
BVA determines that payment of attorney 
fees to Attorney is not reasonable 
pursuant to 38 U.S.C.A. § 5904(d) (West 
1991 & Supp. 1999) or 38 C.F.R. § 20.609 
(1998), and if appealed, such 
determination is affirmed by the Court, 
the paragraph 4 of the February 8, 1997, 
agreement between the client and [W. G. 
S.] shall remain in full force and effect 
notwithstanding the foregoing paragraph 
of this section.  

On November 12, 1999, the VA told the veteran that service 
connection for lumbosacral strain with mild disc disease had 
been granted and found to be 10 percent disabling, effective 
May 1, 1991.  However, twenty-percent of retroactive 
benefits, pending a Board decision on potential attorney fee 
payments, were being withheld.  The veteran was advised of 
applicable law and regulations associated with attorney fees 
and told that attorney fees are only at issue through the 
last day of the month in which the rating decision granted 
retroactive benefits is completed.  In this case, that date 
is September 9, 1999.  It was also noted that the record 
contains an attorney fee agreement which provided for the 
payment of attorney fees by VA directly from past-due 
benefits.  The maximum amount of past-due benefits resulting 
from this award was computed as $9,024 and twenty percent of 
the maximum amount of the past-due benefits was $1,804.80, 
the maximum attorney fee payable from past-due benefits may 
not exceed 20 percent of the past-due benefits.  The veteran 
was also told that the records were being transferred to the 
Board for a determination of eligibility for payment of 
attorney fees from any past-due benefits.  When the Board 
made its decision, VA would pay the amount of fees authorized 
and any excess amounts withheld would be returned.  The 
veteran was also told that he and his attorney should send 
any evidence or argument concerning payment of attorney fees 
from past-due benefits directly to the Board.

In response, D. D. W. submitted a November 1999 argument on 
his behalf.  In his letter D. D. W. maintained that the 
requirement of Section 5904 had been met and as such, he was 
entitled to payment of past-due benefits.  In the 
alternative, D. D. W. asserted that if he did not meet the 
requisite criteria, then the fee agreement between the 
veteran and W. G. S. remained in effect and any monies 
withheld should be paid to W. G. S. 

Law and Regulations

Section 5904, Title 38 of the United States Code provides 
except as provided in paragraph (3), in connection with a 
proceeding before the Department with respect to benefits 
under laws administered by the Secretary, a fee may not be 
charged, allowed, or paid for services of agents and 
attorneys with respect to services provided before the date 
on which the Board first makes a final decision in the case.  
Such a fee may be charged, allowed, or paid in the case of 
services provided after such date only if an agent or 
attorney is retained with respect to such case before the end 
of the one-year period beginning on that date.  The 
limitation in the proceeding sentence does not apply to 
service provided with respect to proceedings before a court.  
38 U.S.C.A. § 5904(c)(1).

Applicable regulation provides attorneys-at-law may charge 
appellants for their services only if (1) a final decision 
has been promulgated by the Board with respect to the issue 
or issues, involved (fees may not be charged, allowed, or 
paid for services provided before the date of the Board's 
decision); (2) the Notice of Disagreement which preceded the 
Board decision with respect to the issue or issues, involved 
was received by the agency of original jurisdiction on or 
after November 18, 1988; (3) and the attorney-at-law or agent 
was retained not later than one year following the date that 
the decision by the Board with respect to the issue or 
issues, involved was promulgated (This condition will be 
considered to have been met with respect to all successor 
attorneys-at-law or agents acting in continuous prosecution 
of the same matter if a predecessor was retained within the 
required time period).  38 C.F.R. § 20.609(c).

The agreement for the payment of fees for services of 
attorneys-at-law must be in writing and signed by the veteran 
and attorney-at-law.  The agreement also must include the 
names of the veteran and attorney, the applicable VA file 
number, and the specific terms under which the amount to be 
paid for the services of the attorney-at-law will be 
determined.  In addition, a copy of the agreement must be 
filed with the Board within 30 days of its execution.  
38 C.F.R. § 20.609(g).

Although the attorney may charge the veteran for legal 
services provided and even though the record shows that the 
parties have entered into a valid fee agreement, VA law also 
provides that the fees permitted for services of an attorney 
must be "reasonable," see 38 C.F.R. § 20.609(e), and in 
accordance with applicable law and regulation, the veteran 
and attorney must be apprised of this regulation and provided 
with the opportunity to submit additional evidence and 
argument.  38 C.F.R. § 20.609(i).

Subject to the above-discussed applicable criteria, the 
veteran and an attorney-at-law may enter into a fee agreement 
providing that payment for the services of the attorney-at-
law will be made directly to the attorney-at-law by VA out of 
any past-due benefits awarded as a result of a successful 
appeal to the Board or an appellate court or as a result of a 
reopened claim before VA following a prior denial of such 
benefits by the Board or an appellate court only if the 
following criteria are met:  (1) the total fee payable 
(excluding expenses) does not exceed 20 percent of the total 
amount of the past-due benefits awarded; (2) the amount of 
the fee is contingent on whether or not the claim is resolved 
in a manner favorable to the claimant, i.e., if all or any 
part of the relief sought is granted; and (3) the award of 
past-due benefits results in a cash payment to a claimant 
from which the fee may be deducted.  38 U.S.C.A. § 5904(d); 
38 C.F.R. § 20.609(h).

Fees permitted for services of an attorney admitted to 
practice before VA must be reasonable.  They may be based on 
a fixed fee, hourly rate, a percentage of benefits recovered, 
or a combination of such bases.  38 C.F.R. § 20.609(e).  
Factors considered in determining whether fees are reasonable 
include: (1) the extent and type of service the 
representative performed; (2) the complexity of the case; (3) 
the level of skill and competence required of the 
representative in giving the services; (4) the amount of time 
the representative spent on the case; (5) the results the 
representative achieved, including the amount of any benefits 
recovered; (6) the level of review to which the claim was 
taken and the level of review at which the representative was 
retained; (7) rates charged by other representatives for 
similar services; and (8) whether, and to what extent, the 
payment of fees is contingent upon the results achieved.  38 
C.F.R. § 20.609(e).  Fees which total no more than 20 percent 
of any past-due benefits awarded are presumed reasonable.  
38 C.F.R. § 20.609(f).

It is also noted that "past-due benefits" means a 
nonrecurring payment resulting from a benefit, or benefits, 
granted on appeal or awarded on the basis of a claim reopened 
after a denial by the Board or the lump sum payment which 
represents the total amount of recurring cash payments which 
accrued between the effective date of the award, as 
determined by applicable laws and regulations, and the date 
of the grant of the benefit by the agency of original 
jurisdiction, the Board, or an appellate court.  Id.

Finally, 38 C.F.R. § 20.609(h)(4) provides that the attorney-
at-law must notify the agency of original jurisdiction within 
30 days of the date of execution of the agreement of the 
existence of a fee agreement providing for the direct payment 
of fees out of any benefits subsequently determined to be 
past due and provide that agency with a copy of the fee 
agreement. 

Analysis

At the outset, it is acknowledged that the requisite criteria 
prescribed in 38 U.S.C.A. § 5904; 38 C.F.R. § 20.609 have 
been met.  Although the January 1994 Board decision denying 
entitlement to a compensable rating for bilateral 
chondromalacia did not address the claim of entitlement to 
service connection for a low back disorder, the issue was 
reasonably raised by the evidence of record at that time.  
Thus, the Board's failure to address that issue became the 
law of the case.  In the Matter of the Fee Agreement of 
Smith, 10 Vet. App. 311, 314 (1997); In the Matter of the Fee 
Agreement of Cox, 11 Vet. App. 158, 162 (1998); Browder v. 
Brown, 5 Vet. App. 268, 270 (1993); see also Ledford v. West, 
136 F.3d 776 (Fed. Cir. 1998); Collaro v. West, 136 F.3d 1304 
(Fed. Cir. 1998).  This is also evinced by procedural 
development undertaken subsequent to the Board's January 1994 
determination, as indicated in the May 1995 joint motion for 
remand, September 1995 Board remand, and February 1998 joint 
motion for remand.  Accordingly, a final Board decision with 
respect to service connection for the low back disability has 
been rendered.  Id.  Further notice of disagreement for that 
decision was received in November 1991, subsequent to 
November 18, 1988.  It is also noted that the veteran 
retained W. G. S. in February 1994, within a year of the 
Board's January 1994 decision and for this reason, the 
requisite criteria have been met with respect to not only W. 
G. S., but also D. D. W., as he is the successor attorney 
acting in the continuous prosecution of the same matter.  38 
C.F.R. § 20.609(c).

The Board also notes that the requisite criteria of 
38 C.F.R. § 20.609(g) have been met.  The February 1994, 
February 1997, and September 1997 fee agreements record the 
name of the veteran and the respective attorney, the VA file 
number, and specify the terms under which the amount to be 
paid would be determined.  The fee agreements were also filed 
with VA within 30 days of execution.  Id.

In the Matter of the Fee Agreement of W. G. S.

Here, the facts are not in dispute.  Instead, the crux of the 
matter rests upon whether W. G. S. is entitled to payment on 
a contingency fee basis, subsequent to terminating the 
attorney-client relationship with the veteran.  

W. G. S.'s July 1999 letter confirms the termination of the 
attorney-fee client relationship.  38 C.F.R. §§ 20.608, 
20.1304 (1999) provides that an attorney may not withdraw 
services as a representative in the appeal unless good cause 
is shown on motion.  Good cause for such purposes is the 
extended illness or incapacitation of an attorney-at-law.  
Such motions must be in writing and must include the name of 
the veteran and reason for the withdrawal.  38 C.F.R. 
§ 20.208(a)(2).  

Here, the Board finds that W. G. S. was justified in 
withdrawing power of attorney.  The record indicates that W. 
G. S. was ill when he terminated employment with the veteran 
and, in fact, that he died on August [redacted], 1999, after 
terminating the attorney-client relationship.  Thus, W. G. S. 
had good cause when terminating the attorney-client 
relationship.

At this time, the Board points out that the February 1994 and 
February 1997 fee agreements entered into by the veteran and 
W. G. S. are silent with respect to the creation or 
continuation of any definite rights or obligations with 
respect to the agreed upon contingency fee following the 
exercise of the attorney's right to terminate the 
relationship with consent or for good cause.  

However, in a precedent opinion, the Office of General 
Counsel noted that current representation was not a statutory 
or regulatory prerequisite to VA's payment of attorney fees 
from past-due benefits.  See 38 U.S.C.A. § 5904(c) and (d); 
38 C.F.R. § 20.609(e).  The fact that an attorney no longer 
represents a veteran does not bar VA from directly paying 
fees from past-due benefits to the attorney, provided all 
other statutory and regulatory requirements for payment of 
fees, as well as other terms of the fee agreement, are met.  
See VAOGCPREC. 22-95 (September 28, 1995). 

Given the fact that W. G. S. satisfied the mandates of 
Section 5904 and in light of the aforementioned General 
Counsel opinion, the evidence shows that in the matter of the 
fee agreement of W. G. S., the criteria for executing a valid 
fee agreement for payment of attorney fees are met. 

In light of the foregoing, the Board must determine whether 
the criteria for payment of fees by VA directly to W. G. S. 
are met.  In this matter the requisite criteria proscribed in 
38 U.S.C.A. § 5904(d) and 38 C.F.R. § 20.609(h) are met.  The 
total fee payable does not exceed 20 percent of the total 
amount of past-due benefits awarded.  The February 1997 fee 
agreement between the veteran and attorney specifically 
states that the fee for representation is contingent upon the 
award of back-pay benefits by the VA and it further provides 
that if an award is made, the fee will equal 20 percent of 
the total past-due benefits payable to the veteran.  Fees 
totaling no more than 20 percent of any past-due benefits 
awarded will be presumed to be reasonable, and it is noted 
that prior to terminating employment, W. G. S., represented 
the veteran in his appeal before the Court and Board on two 
separate occasions dated from 1994 to 1999, and during this 
period he submitted several arguments on the veteran's 
behalf.  It is also presumed the attorney and veteran met on 
several occasions during this period to discuss case 
strategy.  As such, the requirements of 38 C.F.R. § 20.609(e) 
are met.  See also 38 C.F.R. § 20.609(f).

The amount of the fee is also contingent on whether or not 
the claim is resolved in a manner favorable to the claimant 
or appellant.  As noted above, in September 1999, the RO 
granted entitlement to service connection for the low back 
disability, rated at 10 percent effective May 1, 1991.  
Additionally, the language of the attorney fee agreement 
clearly makes the payment of the fee dependent on favorable 
action taken in the veteran's case and as previously noted, 
the claimed benefits were granted.

In view of the foregoing and in conjunction with the November 
12, 1999, letter which expressly states that the amount of 
past-due benefits resulting from the award of benefits was 
computed as $9,024 and from that the maximum amount of 
attorney fees payable, 20 percent ($1,804), had been 
withheld, the record clearly shows that the award of past-due 
benefits has resulted in a cash payment to the veteran from 
which the attorney fee may be deducted.

It is also noted that in this matter the provisions of 38 
C.F.R. § 20.609(h)(4) are met.  In February 1997, the VA 
received notice of the fee agreement; thus, the mandates of 
the foregoing provision have been substantially complied 
with.  Id.

Based on the evidence of record, the requisite criteria for 
payment of fees by the VA directly to W. G. S. from past-due 
benefits have been met.  Past-due benefits resulting from 
entitlement to service connection for a disability will be 
based on the initial disability rating assigned by the RO 
following the award of service connection.  The sum will 
equal the payments accruing from the effective date of the 
award to the date of the initial disability rating decision.  
The grant of entitlement to service connection for 
lumbosacral strain with disc disease was assigned an 
effective date of May 1, 1991, rated at 10 percent and the 
assigned evaluation was effectuated by a September 9, 1999 
rating decision.  Thus, the inclusive dates for the payment 
of benefits arising from that grant of benefits are from 
April 1, 1991, (because payment of monetary benefits may not 
be made before the first day of the calendar month following 
the date of an award, see 38 U.S.C.A. § 5111(a) (West 1991)), 
to September 9, 1999, the date of the rating decision that 
effectuated the grant.

The RO has retained 20 percent of the veteran's total past 
due benefits pending a determination by the Board for 
eligibility for payment of attorney fees from those past-due 
benefits.  As such, it is now incumbent upon the RO to 
compute what amount would be payable to the estate of W. G. 
S.  38 U.S.C.A. § 5904(d) and 38 C.F.R. § 20.609(h).

In the Matter of the Fee Agreement of D. D. W.

In this claim, the Board reiterates that the requisite 
criteria of Section 5904 (c)(1) and 20.609(g) have been met.  
The Board also acknowledges that the record shows that the 
parties entered into a valid fee agreement in September 1999, 
which requires the payment of a 20 percent contingency fee 
upon the successful completion of the claim and the awarding 
of past-due benefits.  VA regulation provides that fees which 
total no more than 20 percent of any past due benefits are 
presumed reasonable.  38 C.F.R. § 20.609(f).  Although this 
presumption has arisen, the Board notes that it is not 
absolute.  See generally 38 C.F.R. § 20.609(i) (The Board may 
review expenses charged by a representative upon the motion 
of the claimant or appellant and may order a reduction in the 
expenses charged if it finds that they are excessive or 
unreasonable in light of the standards set forth in paragraph 
(e) of this section.)  As such, here, the ultimate 
disposition of the matter rests upon whether payment of the 
attorney fee agreed upon in the September 1999 fee agreement 
is reasonable.  38 C.F.R. § 20.609(e) (Fees permitted for 
services of an attorney must be "reasonable").  In this 
case it is noted that the due process requirements mandated 
by 20.609(i) have been satisfied.

Section 20.609(e) provides that fees permitted for services 
of an attorney admitted to practice before VA must be 
reasonable.  They may be based on a fixed fee, hourly rate, a 
percentage of benefits recovered, or a combination of such 
bases.  38 C.F.R. § 20.609(e).  Factors considered in 
determining whether fees are reasonable include: (1) the 
extent and type of service the representative performed; (2) 
the complexity of the case; (3) the level of skill and 
competence required of the representative in giving the 
services; (4) the amount of time the representative spent on 
the case; (5) the results the representative achieved, 
including the amount of any benefits recovered; (6) the level 
of review to which the claim was taken and the level of 
review at which the representative was retained; (7) rates 
charged by other representatives for similar services; and 
(8) whether, and to what extent, the payment of fees is 
contingent upon the results achieved.  38 C.F.R. § 20.609(e).

In this matter, the Board finds that a payment of 20 percent 
of past due benefits, resulting from granting of service 
connection for a low back disorder, to D. D. W. is excessive 
and unreasonable.  Here, the facts show on September 9, 1999, 
the RO granted service connection for a low back disability, 
rated at 10 percent effective from May 1, 1991, and on 
September 21, 1999, after the granting of benefits, the 
veteran appointed D. D. W. as his representative.  The 
parties entered into a fee agreement at that time as well.  
Additionally, the record is devoid of any evidence showing 
that D. D. W. spent any time on the veteran's claim, e.g. the 
attorney has filed no arguments, briefs, or informal hearing 
presentations on the veteran's behalf.  The record shows that 
the attorney has only filed an argument for eligibility to 
payment of attorney fees.  In consideration of the foregoing 
and the absence of any evidence to the contrary, the Board 
finds that, in this matter and only in this matter, the 20 
percent contingent fee is unreasonable and excessive.  Thus, 
in the matter of the fee agreement of D. D. W., the requisite 
criteria for eligibility for payment of attorney fees are not 
met.  

Further, in light of the payment of attorney fees to the 
estate of W. G. S., the Board notes that the arguments 
presented in D. D. W.'s November 1999 statement, which 
address the viability of the fee agreement between the 
veteran and W. G. S., are rendered moot and need not be 
addressed. 

Additional Matter

Finally, the Board is cognizant of the ongoing nature of the 
veteran's appeal, as noted in the Background section above, 
the veteran continues to pursue a claim for entitlement to an 
increased rating in excess of 10 percent for bilateral 
chondromalacia of the knees.  Since the veteran could 
potentially be awarded additional past-due benefits in the 
future with respect to that claim, the Board is compelled to 
clarify that the impact of this decision is limited 
exclusively to the above-discussed eligibility for attorney 
fees for the past-due benefits awarded prior to this 
decision.  It is not intended to affect future Board 
dispositions, if any, of the eligibility for the payment of 
additional attorney fees from any future award of past-due 
benefits resulting from subsequent decisions rendered in any 
ongoing appeal.


ORDER

In the Matter of the Fee Agreement of W. G. S., eligibility 
for direct payment by VA of attorney fees resulting from the 
grant of service connection for lumbosacral strain with disc 
disease and assignment of a compensable evaluation for the 
period from April 1, 1991, to September 9, 1999, from past-
due benefits has been established.  

In the Matter of the Fee Agreement of D. D. W., eligibility 
for payment of attorney fees from past-due benefits is 
denied.  None of the veteran's past-due benefits resulting 
from the grant of service connection for lumbosacral strain 
with disc disease by the September 9, 1999, rating decision 
should be paid to the attorney.



		
	C. Crawford
Acting Member, Board of Veterans' Appeals