BVA9507168 DOCKET NO. 95-02 399 ) DATE ) ) Related to a decision of the Department of Veterans Affairs Regional Office in Phoenix, Arizona THE ISSUE Eligibility for payment of attorney fees from past-due benefits. ATTORNEY FOR THE BOARD R. D. Turano, Counsel INTRODUCTION This matter came before the Board of Veterans' Appeals (Board) following a December 1994 rating decision of the Phoenix, Arizona, Department of Veterans Affairs (VA) decision which effectuated a November 1994 Hearing Officer decision granting service connection on a secondary basis for several disorders found to be related to the veteran's service connected polycythemia and assigning a 100 percent schedular evaluation for this disorder. It was determined that in light of the 100 percent schedular evaluation assigned for the veteran's service connected polycythemia, the issue of entitlement to a total rating for compensation purposes was moot. The effective date of these awards was January 29, 1990. The veteran was notified of this action by letter dated in January 1995. The veteran had entered into a fee agreement with T.J., attorney at law, in October 1993 for representation before the VA and the Board, the agreement of which is the subject of the current review. In November 1994, the veteran submitted a statement in which he specifically revoked his power of attorney for representation by T.J. in this matter. The matter was then transferred to the Board for a determination concerning eligibility for payment of attorney fees out of past-due benefits by the VA to attorney T.J. The parties were notified in letters dated in January 1995 that past due benefits were payable as a result of the above noted determinations and that the Board would be reviewing the matter of the fee agreement. No additional evidence or argument was forthcoming, and the case is now ready for review. CONTENTIONS The parties in this case have made no specific contentions regarding whether the fee should be paid or whether or not the fee is reasonable. 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 files. 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 the evidence is against eligibility for payment of attorney fees from past-due benefits. FINDINGS OF FACT 1. The veteran served on active duty from November 1951 to November 1956, February 1957 to June 1957 and from June 1958 to May 1972. 2. In a decision by the Board dated in September 1991, entitlement to an increased rating for polycythemia was denied. 3. Several issues, apparently raised by the veteran but not in appellate status were referred to the RO for appropriate action, which included entitlement to secondary service connection for angina, tachycardia and chronic obstructive pulmonary disease, as well as entitlement to a total rating for compensation purposes based on individual unemployability. 4. In June 1992, a motion for reconsideration of this September 1991 Board decision in accordance with 38 U.S.C.A. § 7103 (West 1991) was denied. 5. In September 1992 the veteran was examined by the Department of Veterans Affairs (VA) to determine the degree of impairment associated with his service connected polycythemia. 6. In a rating action dated in September 1992, the RO denied entitlement to service connection for several disabilities as well as an increased rating for polycythemia and a total rating for compensation purposes based on individual unemployability. 7. The veteran submitted a timely notice of disagreement to this determination in September 1993. 8. In October 1993, the veteran entered into an agreement to pay a fee to attorney T.J. for representational services before the VA and the Board. 9. In a November 1994 decision, the Hearing Officer at the RO determined that service connection was warranted for several disabilities as secondary to the veteran's service connected polycythemia and that a 100 percent schedular evaluation, effective January 29, 1990, was in order. The issue of entitlement to a total rating for compensation purposes based on individual unemployability was found to be moot based on the above action. 10. In a December 1994 rating decision, the RO effectuated the November 1994 hearing officer's decision. 11. The favorable action by the RO creating an award of past due benefits was not promulgated or derived from a final decision by the Board addressing these particular issues but rather stemmed from new claims. CONCLUSION OF LAW The criteria for a valid fee agreement between the attorney and the veteran for representational services before the VA have not been met. 38 U.S.C.A. § 5904(c)(1) (West 1991); 38 C.F.R. § 20.609(c) (1994). REASONS AND BASES FOR FINDINGS AND CONCLUSION In the present case, the veteran has disabilities for which service connection has been established including polycythemia. In a decision by the Board dated in September 1991, entitlement to an increased rating for polycythemia was denied. Several issues, apparently raised by the veteran during a January 1990 personal hearing but not in appellate status were referred to the RO for appropriate action. These issues included entitlement to service connection on a secondary basis under 38 C.F.R.§ 3.310 for angina, tachycardia and chronic obstructive pulmonary disease, as well as entitlement to a total rating for compensation purposes based on individual unemployability. In June 1992, a motion for reconsideration of the September 1991 decision of the Board in accordance with 38 U.S.C.A. § 7103 (West 1991) was denied. In September 1992 the veteran was examined by the VA in order to determine the degree of impairment associated with his service connected polycythemia and in an effort to assist in the review of these newly raised issues. In a rating action dated in September 1992, the RO denied entitlement to service connection for these disabilities at issue as well as for an increased rating for polycythemia and a total rating based on individual unemployability. The veteran submitted a timely notice of disagreement to this determination in September 1993. In October 1993, the veteran entered into an agreement to pay a fee to attorney T.J. for representational services before the VA and the Board. A copy of this fee agreement has been associated with the record on appeal and in essence provides that a fee of 20 percent of any past due benefits will be paid directly by the VA for representational services by T.J. in the veteran's claims. In a November 1994 decision, the Hearing Officer at the RO determined that service connection was warranted for several disabilities as secondary to the veteran's service connected polycythemia and that a 100 percent schedular evaluation was in order. The issue of entitlement to a total rating for compensation purposes based on individual unemployability was found to be moot based on the above action. Records demonstrate that in November 1994, the veteran submitted a statement in which he specifically revoked his power of attorney for representation by T.J. in the matters before the VA. In a December 1994 rating decision, the RO effectuated the Hearing Officer's decision. Presently, the fee agreement executed by the parties in October 1993 is the subject of review by the Board. It should be noted that fees which could be lawfully charged by attorneys at law and accredited agents for services and proceedings before VA had been limited to $10 since the 1860's. See Walters v. National Ass'n of Radiation Survivors, 473 U.S. 305 (1985). The Veterans Judicial Review Act (VJRA), Pub.L. 100-687, 102 Stat. 4105 (1988), now allows VA claimants and appellants to enter into agreements with attorneys and agents for the payment of fees for services in representing them in proceedings before VA, as long as the fees are neither "unreasonable" nor "excessive." Under the governing criteria, attorneys and agents may charge claimants or appellants for their services before VA, including the Board, only if all of the following conditions have been met: (1) A final decision has been promulgated by the Board with respect to the issue, or issues involved; (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; and (3) 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. 38 U.S.C.A. § 5904(c) (West 1991); 38 C.F.R. § 20.609(c) (1994). All agreements for the payment of fees for services of attorneys- at-law and agents must be in writing and signed by both the claimant or appellant and the attorney-at-law or agent. The agreement must include the name of the veteran, the name of the claimant or appellant if other than the veteran, the applicable VA file number, and the specific terms under which the amount to be paid for the services of the attorney-at-law or agent will be determined. 38 C.F.R. § 20.609(g). Further, the legal criteria provide that 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 of Veterans' Appeals first makes a final decision in the case." 38 U.S.C.A. § 5904(c)(1) (West 1991). In a precedent opinion, the VA's Office of General Counsel cited an analysis of the legislative history of the VJRA contained in the United States Court of Veterans Appeals (Court) decision in In the Matter of Smith, 1 Vet.App. 492, 508-09 (1991) (Steinberg, J., concurring), which highlighted the fact that Congress only envisioned paid attorney representation after the Board first enters a final decision on a claim. The General Counsel concluded that an attorney may not receive or solicit a fee in connection with a representation of a claimant before the Department on a benefits issue until after the Board first issues a final decision on that claim. VA O.G.C. Prec. No. 18-92, 57 Fed. Reg. 49747 (1992). In this case, the Board has not currently adjudicated the underlying claims at issue in the September 1992 RO decision or those matters addressed by a hearing officer in a decision dated in November 1994. The Board promulgated a decision denying entitlement to an increased rating for polycythemia in September 1991 and referred several issues to the RO to address these issues which were not in appellate status. A motion for reconsideration of this September 1991 decision was denied in June 1992. Thereafter, the veteran had apparently undergone a VA examination in January 1992, the report of which was not available. As such, he was scheduled for a new VA examination which was performed in September 1992. Following review of this examination report, the RO adjudicated the new issues of entitlement to service connection for disabilities secondary to the veteran's service connected polycythemia and entitlement to a total rating for compensation purposes based on individual unemployability. As was required in reviewing these issues, the RO reviewed the evaluations assigned for each of the veteran's service connected disabilities, including the 60 percent rating for polycythemia. It was thereby determined that service connection would be granted for disabilities found to be proximately related to this service connected disabilities and that a 100 percent schedular rating was in order for the service connected polycythemia. As such, continuing adjudication of the issue of entitlement to a total rating for compensation purposes based on individual unemployability was determined to be unnecessary as this matter became moot. Accordingly, the Board finds that the September 1992 decision by the RO did not derive from the September 1991 decision by the Board which denied the veteran an increased rating. The United States Court of Veterans Appeals (Court) has concluded that a claim for increased compensation benefits is a new claim not subject to the finality of a prior decision. Proscelle v. Derwinski, 2 Vet. App. 629 (1992). Hence, there plainly can be no final Board decision on these issues upon which favorable action was taken that would bring the fee agreement between the veteran and attorney, T.J., within the required statutory and regulatory parameters. Accordingly, the Board finds that the favorable action by the RO creating an award of past due benefits was not promulgated or derived from a final decision by the Board addressing these particular issues but rather stemmed from new claims. Consequently, under 38 U.S.C.A. § 5904(c)(1) (West 1991) and 38 C.F.R. § 20.609(c)(1) (1994), the attorney may not charge the veteran a fee for representational services before VA. In view of the foregoing, the Board concludes that attorney T.J. is not entitled to payment of attorney fees under the fee agreement in this case from the veteran's past-due benefits and, thus, eligibility for payment of such benefits is not established. ORDER Eligibility for payment by the VA of attorney fees from past-due benefits is denied. None of the veteran's past-due benefits resulting from the December 1994 rating decision which implemented a November 1994 RO Hearing Officer decision should be paid by the VA to the attorney in this case. G.H. SHUFELT 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. § 5904(c)(2) (West 1991), a finding or order of the Board of Veterans' Appeals upon review of an agent's or attorney's fee agreement may be reviewed by the United States Court of Veterans Appeals under 38 U.S.C.A. § 7263(d) (West 1991). Under 38 U.S.C.A. § 7266 (West 1991), a final decision of the Board of Veterans' Appeals may be appealed to the United States Court of Veterans Appeals by a person adversely affected by the decision within 120 days from the date of mailing of notice of the decision. 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 by the Board of Veterans' Appeals.