BVA9501767 
DOCKET NO.  93-03 084     )       DATE
          )
          )

On appeal from the decision of the
Department of Veterans Affairs Regional Office in Nashville,
Tennessee

THE ISSUE

Entitlement to waiver of recovery of an overpayment of improved
disability pension benefits.

REPRESENTATION

Appellant represented by: Tennessee Department of
Veterans' Affairs

INTRODUCTION

The veteran served on active duty from December 1945 to April
1946 and from January 1947 to May 1950.  This matter comes before
the Board of Veterans' Appeals (Board) on appeal from a decision
of the Committee on Waivers and Compromises at the Department of
Veterans Affairs (VA) Nashville, Tennessee, Regional Office (RO).

CONTENTIONS OF APPELLANT ON APPEAL

The veteran contends that waiver of recovery of an overpayment of
improved disability pension benefits should be granted due to the
financial hardship which would result from such recovery.  He
maintains that the overpayment was created due to his inability
to handle financial affairs as a consequence of mental and
physical conditions which required his hospitalization.

DECISION OF THE BOARD

In accordance with the provisions of 38 U.S.C.A. § 7104 (West
1991), following review and consideration of all evidence and
material of record in the veteran's claims file and for the
following reasons and bases, it is the decision of the Board that
the evidence of record supports waiver of recovery of the
overpayment in question.

FINDINGS OF FACT

1.  All relevant evidence necessary for an equitable disposition
of the veteran's appeal has been obtained by the RO.

2.  There was fault on the part of the veteran in creation of the
overpayment by failing to promptly report his receipt of Social
Security benefits.

3.  Recovery of the indebtedness would seriously impair the
veteran's ability to discharge his financial obligations and
would defeat the purpose for which VA disability compensation
benefits are awarded.

CONCLUSION OF LAW

Recovery of the overpayment of improved disability pension
benefits would be against equity and good conscience.
38 U.S.C.A. §§ 5107, 5302 (West 1991); 38 C.F.R. §§ 1.963, 1.965
(1993).

REASONS AND BASES FOR FINDINGS AND CONCLUSION

The veteran's claim is well grounded within the meaning of
38 U.S.C.A. § 5107(a); effective on and after September 1, 1989.
That is, he has presented a claim which is plausible.  All
relevant facts have been properly developed.

The veteran was notified of his award of improved disability
pension benefits, effective May 1990, by letter dated in August
1990.  His award was based on zero countable annual income.  He
was advised that the rate of his pension was directly related to
his family's income and that his payments would be adjusted
whenever his income changed.  He was cautioned to notify the VA
immediately if there were any changes in his income as failure to
do so could result in the creation of an overpayment in his
account.

An Eligibility Verification Report was received from the veteran
in May 1991.  He reported receiving Social Security benefits in
the amount of $779 per month.  He subsequently submitted a copy
of his Social Security award letter which indicates that he was
to receive his first payment of Social Security benefits shortly
after June 12, 1990.  In August 1991, the veteran's award of
improved disability pension benefits was retroactively terminated
effective July 1990, resulting in an overpayment in the amount of
$6,973.

In its decision in February 1992, the Committee on Waivers and
Compromises at the RO held that there had been no fraud, bad
faith or misrepresentation on the part of the veteran in the
creation of the overpayment.  The Board agrees with this
determination.  The veteran has not questioned the amount of the
overpayment or claimed that the overpayment was improperly
created.

As the overpayment did not arise as a result of fraud, bad faith
or misrepresentation on the part of the veteran, waiver of its
recovery may be waived if such recovery would be against equity
and good conscience.  38 C.F.R. § 1.965.

The standard "equity and good conscience" will be applied when
the facts and circumstances in a particular case indicate need
for reasonableness and moderation in the exercise of the
Government's rights.  The decision reached should not be unduly
favorable or adverse to either side.  The phrase, "equity and
good conscience" means arriving at a fair decision between the
obligor and the Government.  In making this determination,
consideration is given to the following elements, which are not
intended to be all-inclusive:  (1)  Fault of the debtor.  Where
actions of the debtor contribute to creation of the debt.  (2)
Undue hardship.  Whether collection would deprive the debtor or
family of basic necessities.  (3)  Defeat the purpose.  Whether
withholding of benefits or recovery would nullify the objective
for which benefits were intended.  (4)  Unjust enrichment.
Failure to make restitution would result in unfair gain to the
debtor.  (5) Changing position to one's detriment.  Reliance on
VA benefits results in relinquishment of a valuable right or
incurrence of a legal obligation.  38 U.S.C.A. § 5302; 38 C.F.R.
§§ 1.963, 1.965.

The overpayment in question unarguably arose due to the veteran's
failure to report promptly his receipt of Social Security
benefits.  He knew or should have known, after being specifically
advised, that he was to report immediately any change in his
income as his rate of pension was directly related to his income.
There was no fault on the part of the VA in the creation of the
overpayment.  The veteran has contended that his failure to
promptly report his receipt of Social Security benefits was due
to mental and physical conditions which required his
hospitalization.  Although records of the reported
hospitalization have not been obtained, the Board notes that the
veteran was found entitled to a permanent and total disability
rating for pension purposes in large part due to a bipolar
disorder, evaluated as 70 percent disabling.  Further, the report
of an examination conducted for aid and attendance purposes in
September 1991 reveals that the veteran had a significant
neurological deficit of uncertain etiology.  Consequently, it
does appear likely that the veteran's mental and physical
condition may have affected his awareness of the necessity to
promptly report his receipt of Social Security benefits.

In his most recent Financial Status Report filed with the RO,
dated in November 1992, the veteran reported that he and his
spouse had a combined monthly net income of $1,335.59, and total
monthly expenses of $942.75, leaving a positive cash flow of just
under $393.  The Board observes that the veteran reported assets
of only $10,400, consisting of furniture and household goods and
two older vehicles.  He had debts in the amount of $3,200 for
medical treatment.  Notwithstanding the positive cash flow
reported by the appellant in November 1982, the Board believes
that, given the veteran's significant medical problems and
limited assets, recovery of the indebtedness likely will result
in financial hardship.  Recovery of the overpayment would further
defeat the purpose for which the benefits were intended, i.e., to
provide the veteran and his spouse a minimum level of financial
support based on his inability to obtain or retain gainful
employment.  As the veteran has meager personal assets, it does
not appear that there was any unjust enrichment of the veteran as
a result of the overpayment in this case.  After carefully
reviewing the entire record, the Board is of the opinion that
recovery of the overpayment of improved disability pension
benefits in the amount of $6,973 would be against equity and good
conscience.  Accordingly, it follows that waiver of recovery of
the indebtedness is in order.  38 U.S.C.A. § 5302; 38 C.F.R.
§§ 1.963, 1.965.  The benefit of the doubt has been resolved in
the veteran's favor.  38 U.S.C.A. § 5107.

ORDER

Entitlement to waiver of recovery of an overpayment of improved
disability pension benefits is granted.

          WAYNE M. BRAEUER
          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.