Veteranclaims’s Blog

June 13, 2022

Single Judge Application; Agent fees; 38 U.S.C. § 5904, when an attorney enters into a valid direct-pay contingency fee agreement with a claimant and the matter is resolved in a manner favorable to the claimant, the Secretary “is obligated to withhold and pay the agreed-upon fee directly to the attorney and that duty also creates a corresponding right for the attorney to collect that fee.” Cox v. Principi,15 Vet.App. 280, 282 (2001) (per curiam order) (emphasis omitted); see 38 U.S.C. § 5904(d)(2)(A)(i) (providing that the agent or attorney will be paid “from any past-due benefits awarded on the basis of the claim”);

Filed under: Uncategorized — veteranclaims @ 7:33 pm

Designated for electronic publication only
UNITED STATES COURT OF APPEALS FOR VETERANS CLAIMS
No. 20-8597
JAMES J. PERCIAVALLE, APPELLANT,
V.
DENIS MCDONOUGH,
SECRETARY OF VETERANS AFFAIRS, APPELLEE.
Before MEREDITH, Judge.
MEMORANDUM DECISION
Note: Pursuant to U.S. Vet. App. R. 30(a), this action may not be cited as precedent.
MEREDITH, Judge: The appellant, James J. Perciavalle, representative of veteran John
Abram, through counsel appeals a September 2, 2020, Board of Veterans’ Appeals (Board)
decision dismissing as moot the issue of entitlement to agent fees based on past-due benefits
granted in a January 2019 rating decision. Record (R.) at 6-13. This appeal is timely, and the Court
has jurisdiction to review the Board’s decision pursuant to 38 U.S.C. §§ 7252(a) and 7266(a).
Single-judge disposition is appropriate. See Frankel v. Derwinski, 1 Vet.App. 23, 25-26 (1990).
For the following reasons, the Court will vacate the Board’s decision and remand the matter for
further proceedings consistent with this decision.
I. BACKGROUND
A. The Veteran’s Claims
The veteran served on active duty in the U.S. Marine Corps from February 1965 to
February 1969. R. at 3040. In August 2016, a VA regional office (RO) awarded the veteran
entitlement to disability compensation for prostate cancer and entitlement to special monthly
compensation (SMC) based on the housebound criteria, each effective June 27, 2016 (the date the
veteran’s claim was received). R. at 1683-88. The following month, the appellant submitted a VA
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Form 21-22a, Appointment of Individual as Claimant’s Representative, notifying VA that he
represented the veteran regarding the claim for benefits. R. at 1491-92. The veteran subsequently
filed a Notice of Disagreement (NOD) as to the effective date assigned for the award of benefits
for prostate cancer, R. at 1484-85, and in August 2018, he elected to opt in to the Rapid Appeals
Modernization Program (RAMP) and requested a higher-level review by the agency of original
jurisdiction (AOJ), R. at 1049.
In January 2019, the AOJ issued a RAMP rating decision awarding entitlement to an earlier
effective date of April 21, 2016, for the prostate cancer and SMC benefits. R. at 1016-28. The
veteran appealed to the Board, R. at 983-84, and in June 2019, the Board denied entitlement to an
effective date prior to April 21, 2016, R. at 917-38. On appeal to the Court, the parties entered into
a joint motion for partial remand, agreeing that “the Board erred when it issued the June 6, 2019,
decision before the 90-day period in which [the veteran] had to submit new evidence expired.”
R. at 57. It is undisputed that this claim stream is still ongoing. See Secretary’s Brief (Br.) at 9 n.1.
Meanwhile, the RO, in April 2020, found clear and unmistakable error (CUE) in the
January 2019 rating decision assigning an effective date of April 21, 2016, for prostate cancer and
SMC benefits, and the RO proposed severing entitlement to benefits for the period from April 21,
2016, to June 27, 2016. R. at 78-81. The veteran appealed that decision to the Board in June 2020.
R. at 54. However, later that month, the RO found that the grants of earlier effective dates for
prostate cancer and SMC were the result of CUE and finalized the severance, explaining that the
veteran was notified of the proposed severance in April 2020, that “[d]ue process has since
expired,” and that “this rating serves to take final action on [the] proposed decision.” R. at 34; see
R. at 34-37. The veteran appealed that decision to the Board in August 2020. R. at 15. It is
undisputed that the Board has not yet decided that appeal. See Appellant’s Br. at 10; Secretary’s
Br. at 8.
B. The Appellant’s Appeal for Agent Fees
Following the January 2019 rating decision awarding the veteran entitlement to an earlier
effective date of April 21, 2016, for the grant of benefits for prostate cancer and for entitlement to
SMC based on housebound status, the RO notified the appellant that fees resulting from past-due
benefits awarded to the veteran would not be paid directly to the appellant from VA because he
had not filed a valid direct-pay fee agreement in the veteran’s case. R. at 996-99; see R. at 1016-28.
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The next month, the appellant filed an NOD. R. at 980-81. He subsequently perfected an appeal to
the Board. R. at 90; see R. at 162-229.
On September 2, 2020, the Board dismissed as moot the appeal of entitlement to agent fees
based on past-due benefits granted in the January 2019 rating decision. R. at 6-13. This appeal
followed.
II. ANALYSIS
A. Parties’ Arguments
The appellant argues that the Board’s decision to dismiss the appeal was void ab initio and
should be reversed by the Court. Appellant’s Br. at 6-11; Reply Br. at 3-5. In that regard, he avers
that the statutes and regulations cited by the Board in concluding that dismissal was appropriate
do not support dismissal of an appeal to the Board. Appellant’s Br. at 7-8. He also contends that
the June 2020 CUE decision, on which the Board relied to find his appeal moot, was unlawful and
that the Board is bound by previous favorable findings supporting an earlier effective date for the
veteran’s prostate cancer and SMC benefits. Id. at 8-10; see Reply Br. at 1-3 (appellant clarifying
that he is not seeking the Court’s review of the June 2020 CUE decision). Furthermore, he argues,
even if the June 2020 CUE decision is valid, fair process required that the Board defer his appeal
regarding agent fees until the veteran’s appeal of the June 2020 CUE decision is final. Appellant’s
Br. at 10-11; Reply Br. at 6-7.
The Secretary generally disputes the appellant’s arguments and asserts that the Court does
not in this appeal have jurisdiction to address the propriety of the June 2020 decision that severed
the veteran’s prior award of an April 2016 effective date. Secretary’s Br. at 7-13. However, the
Secretary concedes that remand of the agent fee claim on appeal is warranted because it is
inextricably intertwined with the veteran’s appeal of the June 2020 rating decision. Id. at 10-11.
B. Discussion
Pursuant to 38 U.S.C. § 5904, when an attorney enters into a valid direct-pay contingency
fee agreement with a claimant and the matter is resolved in a manner favorable to the claimant, the
Secretary “is obligated to withhold and pay the agreed-upon fee directly to the attorney and that
duty also creates a corresponding right for the attorney to collect that fee.” Cox v. Principi,
15 Vet.App. 280, 282 (2001) (per curiam order) (emphasis omitted); see 38 U.S.C.
§ 5904(d)(2)(A)(i) (providing that the agent or attorney will be paid “from any past-due benefits
4
awarded on the basis of the claim”)
. The Court in Cox explained that, “in the case of a 20%
contingency fee agreement, the veteran and the attorney each have a separate entitlement; the
veteran is entitled to 80% of a fixed amount (i.e., the past-due benefits awarded), and the attorney
is entitled to 20% of that fixed amount.” Id. Agents and attorneys seeking fees must comply with
the power of attorney requirements provided in 38 C.F.R. § 14.631 and file with the Agency,
within 30 days of its execution, a written fee agreement containing specific information. See
38 C.F.R. § 14.636(c), (g) (effective to Feb. 18, 2019).
In the decision on appeal, the Board acknowledged the appellant’s assertion that he is
entitled to agent fees based on the January 2019 award to the veteran of earlier effective dates for
entitlement to benefits for prostate cancer and SMC. R. at 8. After summarizing the relevant law
pertaining to agent fees, the procedural history of the veteran’s prostate cancer and SMC claims,
and the procedural history of the appellant’s appeal, the Board noted that the June 2020 rating
decision had severed service connection for prostate cancer and SMC from April 21, 2016, to
June 26, 2016. R. at 8-10. The Board found that the appellant’s claim for agent fees was moot
because, as a result of the RO’s June 2020 CUE decision, the veteran was not awarded earlier
effective dates based on the January 2019 rating decision, and thus there were no past-due benefits
on which to base an agent fee. R. at 10-11. Accordingly, the Board dismissed the appeal. R. at 11.
The Court concludes that the Board provided inadequate reasons or bases for finding that
dismissal is appropriate based on the June 2020 finding of CUE as to the veteran’s benefits. In that
regard, the Board did not acknowledge, as conceded by the parties, that the veteran’s appeal of the
June 2020 rating decision has not become final, nor did the Board explain on what basis the two
matters are related. See Appellant’s Br. at 10; Secretary’s Br. at 10-11; see also R. at 54 (the
veteran’s appeal to the Board of the April 2020 rating decision proposing severance of service
connection for prostate cancer and entitlement to SMC), 15 (the veteran’s appeal to the Board of
the June 2020 rating decision implementing the severance); 38 U.S.C. § 7105(c) (providing that
the decision of the AOJ becomes final if no NOD is filed with the Board). Rather, the Board, after
acknowledging that “past-due benefits [were] awarded in the January 2019 RO decision,” R. at 10,
summarily concluded that there was no such award in light of the 2020 RO decision finding CUE,
without discussing why that decision would be controlling for purposes of determining whether
“past-due benefits [were] awarded on the basis of the claim,” 38 U.S.C. § 5904(d)(2)(A)(i).
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Additionally, the record appears to reflect that VA paid the veteran a lump-sum payment
based on the January 2019 award of past-due benefits, see R. at 997, and that the RO informed the
veteran that VA would not seek recoupment of any overpayment resulting from the June 2020
CUE finding, R. at 24, 69. Yet, the Board did not discuss this history or how, if at all, it may factor
into its finding that there is no award of past-due benefits from which the appellant may be entitled
to a fee. Given these deficiencies in the Board’s reasons or bases, the Court’s review of the Board’s
finding that there was no award of past-due benefits, and its decision to dismiss based on that
finding, is frustrated. See 38 U.S.C. § 7104(d)(1); Allday v. Brown, 7 Vet.App. 517, 527 (1995)
(holding that, with any material issue of fact or law, the Board must provide a statement of reasons
or bases that is “adequate to enable a claimant to understand the precise basis for the Board’s
decision, as well as to facilitate review in this Court”); see also Gilbert v. Derwinski, 1 Vet.App.
49, 56-57 (1990). Accordingly, the Court will vacate the Board decision and remand the matter for
further proceedings. See Tucker v. West, 11 Vet.App. 369, 374 (1998) (“[W]here the Board . . .
failed to provide an adequate statement of reasons or bases for its determinations, . . . a remand is
the appropriate remedy.”).
In doing so, the Court is cognizant of its obligation to consider whether Board errors are
prejudicial. See 38 U.S.C. § 7261(b)(2); Shinseki v. Sanders, 556 U.S. 396, 409 (2009). In that
regard, the Board here noted that the appellant had not submitted a fee agreement in September
2016 when VA received a signed form appointing him as the veteran’s representative and that, in
its January 2019 decision denying the appellant entitlement to agent fees, the RO stated that he
had not filed a direct-pay fee agreement as required by VA’s regulation. R. at 9-10. Because the
Board determined that the June 2020 CUE finding rendered the agent fee appeal moot, the Board
did not assess whether the appellant had filed a valid fee agreement. Although a finding that the
appellant had not filed a required fee agreement could potentially render moot a discussion of
whether there was an award of past-due benefits, the Court may not resolve that factual dispute in
the first instance. See Tadlock v. McDonough, 5 F.4th 1327, 1337-38 (Fed. Cir. 2021).
Given this disposition, the Court will not now address the remaining arguments and issues
raised by the appellant. See Quirin v. Shinseki, 22 Vet.App. 390, 395 (2009) (“[T]he Court will not
ordinarily consider additional allegations of error that have been rendered moot by the Court’s
opinion or that would require the Court to issue an advisory opinion.”); Best v. Principi,
15 Vet.App. 18, 20 (2001) (per curiam order). On remand, the appellant is free to submit additional
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evidence and argument on the remanded matter, including the specific arguments raised here on
appeal, and the Board is required to consider any such relevant evidence and argument. See Kay
v. Principi, 16 Vet.App. 529, 534 (2002); Kutscherousky v. West, 12 Vet.App. 369, 372-73 (1999)
(per curiam order). The Court reminds the Board that “[a] remand is meant to entail a critical
examination of the justification for the decision,” Fletcher v. Derwinski, 1 Vet.App. 394, 397
(1991), and the Board must proceed expeditiously, in accordance with 38 U.S.C. § 7112.
III. CONCLUSION
After consideration of the parties’ pleadings and a review of the record, the Board’s
September 2, 2020, decision is VACATED, and the matter is REMANDED for further
proceedings consistent with this decision.
DATED: June 10, 2022
Copies to:
Kenneth H. Dojaquez, Esq.
VA General Counsel (027)

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