Citation Nr: 0007507 Decision Date: 02/11/00 Archive Date: 09/08/00 DOCKET NO. 98-17 621 DATE FEB 11, 2000 On appeal from the Department of Veterans Affairs Regional Office in San Juan, Puerto Rico THE ISSUE Entitlement to waiver of recovery of an overpayment of Department of Veterans Affairs improved pension benefits in the amount of $8,065.00. ATTORNEY FOR THE BOARD J. Andrew Ahlberg, Counsel INTRODUCTION The veteran served on active duty from August 1967 to August 1969. In April 1997, the San Juan, Puerto Rico, Regional Office (RO) retroactively terminated payment of the veteran's Department of Veterans Affairs (VA) improved pension benefits as of May 1996 due to his receipt of Social Security Administration (SSA) benefits and reinstated payment of his disability compensation. In May 1997, the veteran was informed in writing of an overpayment of VA improved pension benefits in the amount of $8,065.00 and his waiver rights. This matter came before the Board of Veterans' Appeals (Board) on appeal from a September 1997 decision of the RO's Committee on Waivers and Compromises (Committee) which denied the veteran's request for waiver of recovery of the overpayment of VA improved pension benefits in the amount of $8,065.00. The veteran has been represented himself throughout this appeal. FINDINGS OF FACT 1. All relevant available evidence necessary for an equitable disposition of the veteran's appeal has been obtained by the RO. 2. The veteran was overpaid VA improved pension benefits in the amount of $8,065.00 between May 1996 and April 1997 due to his failure to promptly and accurately inform the VA of his receipt of SSA benefits. 3. Notwithstanding the veteran's fault in creating the overpayment of VA improved pension benefits, recovery of the indebtedness would result in severe financial hardship to the veteran. CONCLUSIONS OF LAW 1. The overpayment of VA improved pension benefits in the amount of $8,065.00 was not due to error solely on the part of the VA and was otherwise properly created. 38 U.S.C.A. 5107(a) (West 1991); 38 C.F.R. 3.660(a) (1999). 2. Recovery of the overpayment of VA improved pension benefits in the amount of $8,065.00 would be against the principles of equity and good conscience. 38 U.S.C.A. 5302 (West 1991 & Supp. 1999); 38 C.F.R. 1.963(a), 1.965(a) (1999). 2 - REASONS AND BASES FOR FINDINGS AND CONCLUSIONS I. Creation of the Debt Generally, a veteran in receipt of VA pension benefits must notify the VA of all circumstances which will affect his entitlement to receive pension benefits or the rate of those benefits. Such notice must be furnished when the recipient acquires knowledge that his income has changed. 38 C.F.R. 3.660(a)(1) (1999). An April 1996 SSA award letter indicates that the veteran had been awarded SSA disability benefits effective as of February 1996 and would receive his first payment in April 1996. In May 1996, the veteran was granted VA improved pension benefits. In its May 1996 written notification to the veteran of his award, the RO stated that he had reported receiving no income from any source including SSA benefits. The RO informed the veteran that he was required to promptly report any change in his family's income in order to avoid creation of an overpayment of benefits to him. A March 1997 RO notice to the veteran states that he had failed to complete an eligibility verification report which had been sent to him in January 1997. In his April 1997 VA Improved Pension Eligibility Verification Report (Veteran with No Children), the veteran reported that he received monthly SSA benefits in the amount of $1089.00. Based upon his reported SSA benefits, the RO retroactively terminated payment of the veteran's VA improved pension benefit,; as of May 1996 and reinstated payment of his disability compensation. In a May 1997 written statement, the veteran acknowledged that he had been informed in writing of the overpayment of VA improved pension benefits in the amount of $8,065.00 and requested waiver of recovery of the overpayment. Additionally, he stated that he had not intended to deceive either the VA or the Federal Government. The veteran failed to promptly report his receipt of SSA benefits. lie has not contested the amount of the overpayment. In light of this fact, the Board finds that - 3 - the overpayment of VA improved pension benefits in the amount of $8,065.00 was solely the consequence of the veteran's own action and thus properly created. II. Waiver of Recovery Recovery of an overpayment of VA improved pension benefits may be waived if recovery of the indebtedness from the payee who received the benefit would be against equity and good conscience. 38 U.S.C.A. 5302 (West 1991 & Supp. 1999); 38 C.F.R. 1.963 (a) (1999). The equity and good conscience standard means arriving at a fair decision between the obligor and the Government. In making this decision, consideration is to be given to factors such as: the fault of the debtor; a balancing of the fault of the debtor against any fault of the VA; whether collection would deprive the debtor of basic necessities; whether recovery would nullify the objective for which the benefits were intended; whether a failure to make restitution would result in unfair gain to the debtor; and whether reliance on the benefits would result in relinquishment of a valuable right or incurrence of a legal obligation. 38 C.F.R. 1.965(a) (1999). The report of an April 1996 VA examination for compensation purposes notes that the veteran was diagnosed with arteriosclerotic heart disease, coronary artery disease, myocardial infarction residuals, coronary artery bypass graft residuals, congestive heart failure, and hypertension. In his May 1997 Financial Status Report (VA Form 20-5655), the veteran indicated that: his family's gross monthly income consisted of SSA benefits in the amount of $1,089.00 and VA disability compensation in the amount of $94.00; they had a net monthly income of $1,183.00; their monthly expenses totaled $1,413.00; and their assets consisted of a 1983 automobile. The veteran advanced that recovery of the overpayment of VA improved pension benefits would cause him serious economic hardship and destabilize his health condition as his monthly expenses currently exceeded his monthly income by $230.00. 4 - In his September 1998 Financial Status Report (VA Form 20-5655), the veteran indicated that: his family's gross monthly income consisted of SSA benefits in the amount of $1,112.00 and VA disability compensation in the amount of $95.00; they had a net monthly income of $1,207.00; their monthly expenses totaled $1,460.00; and their assets consisted of a 1983 automobile. In his September 1998 substantive appeal, the veteran advanced that his current financial situation was extremely restricted. The Board has reviewed the probative evidence including the veteran's statements on appeal. While the veteran was at fault in the creation of the overpayment of VA improved pension benefits,, the Board observes that recovery of the overpayment would clearly result in severe financial hardship to the veteran and probably render him unable to meet his family's basic necessities. In May 1997, the veteran reported monthly expenses which exceeded his net monthly income by $230.00. In September 1998, the veteran reported monthly expenses which exceeded his net monthly income by approximately $253.00. He has several significant post-operative cardiovascular disabilities. Upon application of the aforementioned authorities to the instant appeal, the Board concludes that recovery of the overpayment from the veteran would be against equity and good conscience. According, a waiver of recovery of the overpayment of VA improved pension benefits to the veteran in the amount of $8,065.00 is granted. ORDER Waiver of recovery of VA improved pension benefits in the amount of $8,065.00 is granted. J. T. HUTCHESON Acting Member, Board of Veterans' Appeals 5 -