BVA9505819 DOCKET NO. 93-10 932 ) DATE ) ) On appeal from the decision of the Department of Veterans Affairs Regional Office in Detroit, Michigan THE ISSUE Whether the discontinuance of compensation benefits, from July 1, 1992 to October 1, 1992, due to the value of the veteran's estate was proper. REPRESENTATION Appellant represented by: Veterans of Foreign Wars of the United States WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD Susan S. Toth, Associate Counsel INTRODUCTION The veteran had active service from September 1964 to December 1965. The Regional Office (RO) informed the appellant, through a letter of January 1992, that the RO proposed to terminate the veteran's compensation benefits pursuant to Public Law 101-508, the Congressional Omnibus Budge Reconciliation Act of 1990. This matter arises from an administrative action of June 1992, whereby the RO terminated the veteran's compensation benefits based on an excessive estate, from February 1, 1992. The Board of Veterans' Appeals (Board) notes that the hearing officer issued a decision in November 1992, whereby compensation benefits were reinstated from February 1, 1992 to June 30, 1992. On January 31, 1992, the United States District Court for the Southern District of New York granted plaintiff's motion for a preliminary injunction to prevent the Department of Veterans Affairs from "applying or enforcing § 8001 of the Omnibus Budget Reconciliation Act of 1990, codified at 38 U.S.C.A. § 3205" (renumbered § 5505 in 1991) in Disabled American Veterans v. United States Department of Veterans Affairs, C.A. No. 91 Civ. 1413 (SWK) (S.D.N.Y.), a class action suit. The parties subsequently stipulated in February 1992 that the Board would suspend the adjudication of constitutional issues in appeals concerning the application of 38 U.S.C.A. § 5505 (West 1991), but would not suspend the adjudication of nonconstitutional issues to the application of 38 U.S.C.A. § 5505 brought by class members before the Board, in appeals which were pending or which were filed after the date of the stipulation and order. The stipulation and order were signed by the Court on February 24, 1992. The temporary injunction was subsequently vacated. The Board notes that the provisions of 38 U.S.C.A. § 5505 expired as of September 30, 1992. In addition, on March 10, 1993, the United States District Court for the Southern District of New York approved the Proposed Stipulation and Order of Settlement and Dismissal in Disabled American Veterans v. United States Department of Veterans Affairs, C.A. No. 91 Civ. 1413 (SWK) (S.D.N.Y.), a class action suit involving the application of 38 U.S.C.A. § 5505. The parties stipulated that the action, including all claims raised by plaintiffs in their proposed third amended and supplemented complaint and all claims that could have been raised in this action, including but not limited to any cause of action under the Americans With Disabilities Act, be dismissed with prejudice, subject to certain terms and conditions. In pertinent part, the parties agreed that members of the nationwide class of veterans are not precluded from claiming that their entitlement to disability compensation did not meet the prerequisites of § 5505 during any part of the life of § 5505 or from requesting a waiver of recoupment from VA of any overpayment of disability compensation made after June 1992. The VA agreed to relinquish the right to recoup payments made during the five months after the injunction was ordered (and to refund any that the veterans voluntarily returned), and plaintiffs relinquished any claim to the benefits that were suspended during the remaining 18 months the law was in effect. Accordingly, the instant appellate determination will deal solely with whether compensation benefits were properly discontinued between July 1, 1992 and October 1, 1992. CONTENTIONS OF APPELLANT ON APPEAL The appellant contend that the action to terminate the veteran's compensation was unconstitutional and discriminatory against veterans with mental disabilities. It is asserted that the veteran's estate will be reduced which could result in a hardship for the veteran if the estate is unable to pay for future expenses. DECISION OF THE BOARD The Board, in accordance with the provisions of 38 U.S.C.A. § 7104 (West 1991), has reviewed and considered all of the evidence and material of record in the veteran's claims file. Based on its review of the relevant evidence in this matter, and for the following reasons and bases, it is the decision of the Board that this incompetent veteran's estate was excessive for the receipt of compensation benefits prior to October 1, 1992. FINDINGS OF FACT 1. The veteran, who has been rated as incompetent for many years, does not have a spouse or other dependents. 2. The veteran's estate, excluding the value of any home, was in excess of $25,000 during the period of time in question. CONCLUSION OF LAW The incompetent veteran's estate was a bar to the receipt of compensation benefits from July 1, 1992 to September 30, 1992. 38 U.S.C.A. § 5505(a) (West 1991). REASONS AND BASES FOR FINDINGS AND CONCLUSION Effective from November 1, 1990 to September 30, 1992, compensation may not be paid to any veteran without a spouse, child or dependent parent who is rated incompetent and who has an estate valued in excess of $25,000, excluding the value of the veteran's home. Further payment of compensation to which the veteran would otherwise be entitled may not be made until the value of such estate is reduced to less than $10,000. 38 U.S.C.A. § 5505(a). The RO issued a rating decision in April 1966, whereby service connection was awarded for schizophrenic reaction. Incompetency status was also established, effective from March 24, 1966. The veteran's status as incompetent has continued until the present. To date, the appellant has not contended or shown either that the veteran is competent, his estate has been reduced to less than $10,000, or that he has a qualifying dependent. As of June 30, 1990, the veteran's estate was valued at $106,559.51. In November 1992, the appellant appeared and testified at a hearing conducted at the RO. At that time, the appellant reported that the veteran lived in a foster home and it was unknown whether or not his parents were then living. His estate totaled $125,882.00. After review of the claims folder, the Board concludes that the incompetent veteran's compensation benefits were properly terminated prior to October 1, 1992, since he had neither qualifying dependents nor an estate totaling less than $25,000. The argument concerning the possibility that the veteran might experience future hardship has been considered; however, this is not dispositive. The law is clear and leaves no alternative. The United States Court of Veterans Appeals has held that in a case where the law is dispositive of the claim, the claim should be denied or the appeal to the Board terminated because of the absence of legal merit or the lack of entitlement under the law. Sabonis v. Brown, 6 Vet.App. 426, 430 (1994). The Board will not address the constitutional arguments raised in this appeal other than to comment that the Court case referred to in the Introduction section of the decision dismissed with prejudice, claims to the constitutionality of the statute in question. ORDER Since the value of the veteran's estate was excessive for the receipt of compensation benefits from July 1, 1992 to September 30, 1992, the appeal is denied. C. W. SYMANSKI Member, Board of Veterans' Appeals The Board of Veterans' Appeals Administrative Procedures Improvement Act, Pub. L. No. 103-271, § 6, 108 Stat. 740, ___ (1994), permits a proceeding instituted before the Board to be assigned to an individual member of the Board for a determination. This proceeding has been assigned to an individual member of the Board. NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West 1991), a decision of the Board of Veterans' Appeals granting less than the complete benefit, or benefits, sought on appeal is appealable to the United States Court of Veterans Appeals within 120 days from the date of mailing of notice of the decision, provided that a Notice of Disagreement concerning an issue which was before the Board was filed with the agency of original jurisdiction on or after November 18, 1988. Veterans' Judicial Review Act, Pub. L. No. 100-687, § 402 (1988). The date which appears on the face of this decision constitutes the date of mailing and the copy of this decision which you have received is your notice of the action taken on your appeal by the Board of Veterans' Appeals.