[00:00:34] Speaker ?:
Thank you.

[00:01:05] Speaker 00:
Yes.

[00:01:20] Speaker ?:
Yes.

[00:01:20] Speaker ?:
Yes.

[00:01:37] Speaker ?:
Okay.

[00:01:52] Speaker ?:
Okay.

[00:01:56] Speaker ?:
Okay.

[00:02:13] Speaker ?:
Bye.

[00:02:43] Speaker 02:
Thank you.

[00:03:27] Speaker 00:
All rise.

[00:03:33] Speaker 04:
The United States Court of Appeals for the Federal Circuit is now open and in session.

[00:03:41] Speaker ?:
God save the United States.

[00:03:41] Speaker ?:
Amen.

[00:03:42] Speaker 01:
Please be seated.

[00:03:50] Speaker 01:
Our first case today is 2016-1529.

[00:03:56] Speaker 01:
Snyder vs. Secretary of Veterans Affairs.

[00:03:59] Speaker 02:
Mr. Carpenter, please proceed.

[00:04:03] Speaker 02:
There is a threshold question that this panel needs to resolve in terms of which of two cases controls this court's jurisdiction over the authority to review the General Counsel's opinion in this case.

[00:04:21] Speaker 02:
Those cases are Splane vs.

[00:04:27] Speaker 02:
the secretary and paralyzed veterans versus the secretary.

[00:04:32] Speaker 02:
Congress defined the rule as an agency state of particular applicability.

[00:04:39] Speaker 01:
Why don't we start with the statute, if you don't mind?

[00:04:42] Speaker 01:
Because you're suggesting to us is that we have two cases that are in your view in confusion or conflict with each other, both of which really pertain to what

[00:04:55] Speaker 01:
the statute covers.

[00:04:56] Speaker 01:
So why don't we actually start with the statute, and then you can tell me which of the two cases seem most faithful to the statute as a starting point.

[00:05:05] Speaker 01:
What do you think the statute tells us about this?

[00:05:08] Speaker 02:
That the statute contemplates that this court has jurisdiction to deal with substantive rules.

[00:05:17] Speaker 02:
of general applicability adopted as authorized by law.

[00:05:22] Speaker 02:
The general counsel's opinion is authorized by law.

[00:05:26] Speaker 02:
52, excuse me, 552A1D is the controlling provision in the statute.

[00:05:35] Speaker 02:
I believe that this court's decision in Splendor v. West correctly interprets

[00:05:41] Speaker 02:
that a general counsel's opinion qualifies under that definition of a rule.

[00:05:46] Speaker 02:
But it is, thereby, a substantive rule, not a substance rule that requires notice and comment.

[00:06:03] Speaker 02:
but a substantive rule that, as an interpretive rule, is within the ambit of the statute and gives this court authority to review.

[00:06:18] Speaker 03:
Is there any difference between the general counsel opinions in the two cases, Splane and Paralyzed Veterans, that might

[00:06:32] Speaker 03:
be a basis for saying both of those decisions could be correct or are we really in a situation where they're just flat out inconsistent with each other and we need to figure out which one is going to govern?

[00:06:47] Speaker 02:
I have struggled mightily to see that there is some difference but I cannot.

[00:06:52] Speaker 02:
In Slane, they were interpreting a statute and the court found that they were interpreting a statute.

[00:06:58] Speaker 02:
In PVA, they were asked by the board

[00:07:03] Speaker 02:
the provisions of 1151.

[00:07:05] Speaker 02:
I believe that they did and they were required to in order to answer the questions that were posed by the board.

[00:07:12] Speaker 02:
The panel in PVA never reached the merits because they said that they did not have

[00:07:18] Speaker 03:
But what about your claim here?

[00:07:22] Speaker 03:
Are you making a challenge to the general counsel's legal interpretation or to the application of that legal interpretation to Mr. Snyder's particular fee agreement?

[00:07:36] Speaker 02:
The former and not the latter, because the general counsel's opinion does not apply to Mr. Snyder's case, although it is the basis for that opinion.

[00:07:45] Speaker 02:
that general counsel's opinion under the provisions of 7104C, the board would be bound to follow that in applying it to Mr. Snyder's, well actually it's Mrs. Beck's appeal that she has been allowed to be, we believe, improperly substituted in or as an accrued benefit claim.

[00:08:07] Speaker 03:
Is it your position that

[00:08:11] Speaker 03:
I guess Mr. Snyder could win in that appeal on a ground that the general counsel's opinion simply doesn't apply to this particular case.

[00:08:27] Speaker 02:
If the interpretation made of 5904D as an accrued benefit, excuse me, the attorney fee is required to be paid under 5904,

[00:08:41] Speaker 02:
as interpreted by the general counsel's opinion constitutes an accrued benefit, then Mr. Snyder would prevail in the appeal only if this court invalidated that interpretation and found that that was a misinterpretation.

[00:08:59] Speaker 02:
Therefore, it is dispositive, in my judgment, of the appeal that's pending before the board.

[00:09:06] Speaker 02:
I also believe that the appeal pending before the board, based upon the

[00:09:10] Speaker 02:
state of the law at the time of Mr. Beck's death rendered that appeal moot and was properly dismissed originally by the board based upon his death.

[00:09:25] Speaker 02:
And therefore, that proceeding should be over and the VA should be required by law to comply with the provisions of 5904 and pay the fee that they withheld to Mr. Snyder.

[00:09:36] Speaker 01:
They should pay Mr. Snyder $41,920, which is 20 percent of the benefits that this veteran got, despite the fact that he actually withdrew from representation in the case only 10 months after initiating it and with only having written basically a two-page letter on behalf of the veteran.

[00:10:03] Speaker 01:
And then the veteran went on for two years to prosecute his case to successful completion.

[00:10:07] Speaker 01:
And now Mr. Snyder swoops back in and would like to take 20%, i.e.

[00:10:11] Speaker 01:
$20,000 or $40,000 of the veteran's benefit without having done any work towards the successful completion of that case.

[00:10:20] Speaker 01:
That's what you're advocating for today, Mr. Carpenter.

[00:10:24] Speaker 01:
It doesn't seem like a position that I'm surprised to see you standing at the podium today.

[00:10:28] Speaker 01:
Go ahead.

[00:10:29] Speaker 02:
With respect, Your Honor, I do not believe that's a fair characterization of what has happened in this case.

[00:10:35] Speaker 02:
This court is not permitted to examine the facts or how those facts were applied.

[00:10:42] Speaker 01:
That's certainly the first time I've ever heard you say that.

[00:10:45] Speaker 02:
Having been bludgeoned with that rule, I have to acknowledge its existence.

[00:10:51] Speaker 02:
However, Your Honor, in this case, the VA, notwithstanding the description of the facts as you described them,

[00:10:59] Speaker 02:
found that Mr. Snyder was entitled to that fee.

[00:11:04] Speaker 02:
And that question was on appeal by Mr. Beck at the time of his death.

[00:11:10] Speaker 02:
That appeal, or excuse me, that decision by the VA was the law of that case, and that case ended with the death of Mr. Beck.

[00:11:22] Speaker 02:
We are not here to argue the merits of whether or not Mr. Snyder was or was not entitled

[00:11:29] Speaker 01:
to that fee, or should, or the VA... No, we're here to decide whether or not the VA general counsel properly decided that his widow could go forward with that appeal.

[00:11:41] Speaker 02:
Well, I'm not quite sure that that's what the general counsel's opinion decided, but that is the effect of this decision.

[00:11:48] Speaker 02:
What the general counsel's opinion decided was is that attorney fees as a claim

[00:11:55] Speaker 02:
constituted accrued benefits under the provisions of 5121 small a. They do not constitute accrued benefits because they are not periodic monetary payments.

[00:12:08] Speaker 02:
The periodic monetary payments were paid in full to Mr. Beck during his lifetime.

[00:12:15] Speaker 02:
Pursuant to the plain language of 5904D, 20% of those past due benefits

[00:12:21] Speaker 02:
were withheld and directed to be paid by the secretary to Mr. Snyder.

[00:12:28] Speaker 02:
Once that decision was made by the VA, that converted these funds to attorney fees and stopped those funds from being or ever able to be considered again as periodic monetary benefits.

[00:12:44] Speaker 02:
The only way that 5121 small a is implicated in this matter

[00:12:49] Speaker 02:
is if and only if there was an entitlement to periodic monetary benefits.

[00:12:55] Speaker 02:
Attorney fees are not periodic monetary benefits.

[00:12:59] Speaker 02:
They are sums that by a statutory contract that was created by Congress are withheld from those periodic monetary benefits based upon a percentage of a contingent fee agreement for representation.

[00:13:16] Speaker 02:
That contingent fee agreement

[00:13:18] Speaker 02:
for representation was found valid by the VA.

[00:13:22] Speaker 02:
And Mr. Snyder and Mr. Beck were both notified that that fee was payable by the VA to Mr. Snyder.

[00:13:33] Speaker 02:
The provisions of 5121 small a have been misinterpreted by the general counsel in this opinion to permit Mrs. Beck to then step into the shoes of Mr. Beck

[00:13:48] Speaker 02:
as though this were an accrued benefit.

[00:13:51] Speaker 02:
It is not an accrued benefit by definition.

[00:13:54] Speaker 02:
An accrued benefit is unambiguously defined by Congress as a periodic monetary benefit.

[00:14:00] Speaker 02:
Attorney fees simply are not.

[00:14:03] Speaker 03:
Can I ask, I don't think this has been raised here maybe just because this is the 502 appeal or maybe there's really no dispute, but do you have a dispute that Mrs. Beck can

[00:14:17] Speaker 03:
make the claim to the VA for the 41K or some part of it, even though that money is no longer in the VA's possession but has been paid out already to Mr. Snyder?

[00:14:31] Speaker 03:
Am I right on the premise he has actually received that money?

[00:14:35] Speaker 03:
No, I do not believe he has received that money.

[00:14:38] Speaker 03:
I thought there was a description that the money was released to him.

[00:14:43] Speaker 03:
If that's the case, I'm sorry, I just don't recall.

[00:14:45] Speaker 03:
But assuming that the money has been paid out, her claim can still... Not through the VA system, Your Honor, because she does not have standing, as this court has repeatedly held... Apart from your argument about whether this is an accrued benefit.

[00:15:06] Speaker 02:
I'm not sure apart from that argument.

[00:15:09] Speaker 02:
That argument is dependent upon 5904.

[00:15:11] Speaker 02:
The only way that she would be able to petition, as you're describing it, within the VA system is as an accrued benefit claimant.

[00:15:20] Speaker 02:
An accrued benefit claimant has to be seeking due and unpaid periodic monetary benefits.

[00:15:28] Speaker 03:
I'm trying to ask a different question.

[00:15:30] Speaker 03:
Assume that what she is seeking is due and unpaid accrued benefits.

[00:15:40] Speaker 03:
Does the fact that that money has already been paid out by the department to somebody else, Mr. Snyder, affect it all by itself, change the ability?

[00:15:54] Speaker 03:
I do not.

[00:15:55] Speaker 03:
Well, that's an interesting question.

[00:15:58] Speaker 02:
That's not really here.

[00:16:01] Speaker 02:
Because then the question would be what authority does the VA have to then continue that proceeding when the only purpose of 5121 small a as an accrued benefit claimant is to pay the money to the survivors.

[00:16:17] Speaker 02:
They don't have the monies anymore.

[00:16:19] Speaker 02:
If they don't have the monies anymore, it would seem to me that that would be beyond the authority, the statutory authority granted by Congress

[00:16:28] Speaker 02:
to authorize the recovery of those monies by Mrs. Beck through the VA process.

[00:16:36] Speaker 01:
You're into your rebuttal time.

[00:16:37] Speaker 01:
Would you like to save the remainder?

[00:16:39] Speaker 02:
Yes, I would.

[00:16:39] Speaker 01:
Thank you.

[00:16:40] Speaker 01:
Thank you.

[00:16:52] Speaker 00:
May it please the court, I'd like to start with the question of jurisdiction here.

[00:16:56] Speaker 00:
And I'd like to start with Splane and PDA.

[00:17:01] Speaker 01:
Why don't you start with the statute instead?

[00:17:03] Speaker 01:
The statute contains two sentences.

[00:17:08] Speaker 01:
Doesn't this fall under 552A?

[00:17:09] Speaker 01:
Does it fall under 552A?

[00:17:15] Speaker 01:
Yes, because that's something over which our court has direct authority, right?

[00:17:22] Speaker 00:
If this were a general counsel opinion that were not issued in the function of the VA's quasi adjudication, then yes, that would fall under.

[00:17:35] Speaker 00:
However, what PDA addressed and what we think is correct is that Section 512.

[00:17:40] Speaker 01:
I want you to look at the statutory language.

[00:17:42] Speaker 01:
552 says,

[00:17:46] Speaker 01:
that we have authority, well actually it's what, 502.

[00:17:49] Speaker 01:
It says we have the authority over anything in 552A1.

[00:17:52] Speaker 01:
And in 552A1D, it says substantive rules of general applicability adopted as authorized by law and statements of general policy or interpretations of general applicability formulated and adopted by the agency.

[00:18:11] Speaker 01:
Why isn't the VA council opinion exactly the latter?

[00:18:15] Speaker 01:
a statement of general policy or interpretation formulated and adopted by the agency.

[00:18:20] Speaker 00:
Because 552A1 comes into play only through Section 502, and Section 502 has two sentences, the first which speaks to Section 552A1, the second which starts with

[00:18:37] Speaker 00:
However, if such review is sought in connection with an appeal brought under the provision of chapter 72 of this title, the provisions of that chapter shall apply rather than the provisions of chapter seven of title five.

[00:18:50] Speaker 00:
And this is where there is a distinction between Splane and PVA.

[00:18:55] Speaker 01:
I want you to talk about the statute.

[00:18:57] Speaker 01:
I don't want to talk about Splane or PVA.

[00:18:59] Speaker 01:
So this second sentence says, however, if review is sought in connection with appeal,

[00:19:04] Speaker 01:
Doesn't that suggest that review could also be sought not in connection with appeal?

[00:19:08] Speaker 01:
And isn't that in fact the way 502 first sentence has typically been read?

[00:19:12] Speaker 01:
We have the ability to hear a direct challenge to something that falls under 552A1 or 553.

[00:19:21] Speaker 01:
Isn't that right?

[00:19:23] Speaker 01:
Is that right, yes or no?

[00:19:25] Speaker 01:
I want to know if my understanding of 502 is right.

[00:19:29] Speaker 00:
Your Honor, respectfully, I don't think it is because

[00:19:33] Speaker 00:
There is a distinction between a general counsel's opinion, which is issued in response to a request from the board.

[00:19:39] Speaker 01:
All I'm asking you is, is it the case that we have direct review authority under an action by the secretary under 552A1?

[00:19:48] Speaker 01:
Do we have direct review authority of an action by the secretary which falls under 552A1?

[00:19:54] Speaker 01:
Yes or no?

[00:19:56] Speaker 00:
Yes, except where the appeal originates in connection with an appeal brought under Chapter 72.

[00:20:05] Speaker 00:
And this is an important distinction because Splane assumed jurisdiction under the first sentence of Bible II.

[00:20:12] Speaker 01:
But this isn't a case brought under Chapter 72, correct?

[00:20:15] Speaker 00:
But PDA answered that.

[00:20:16] Speaker 01:
But this one isn't a case brought under Chapter 72.

[00:20:20] Speaker 01:
exception in the statute doesn't apply to this case, correct?

[00:20:24] Speaker 00:
PVA interpreted 502, including the second sentence, to include a direct appeal of a general counsel's opinion that was issued in response to a request from the board in a particular veteran's claim.

[00:20:37] Speaker 00:
Even if there is more than one reasonable interpretation of what section 502 means or what the second sentence of 502 means, that is not a question for this panel because it was addressed

[00:20:48] Speaker 00:
explicitly by the court and PVA.

[00:20:50] Speaker 01:
And PVA and Splane are arguably inconsistent with each other, which is why I've tried very hard to get you to focus on the statutory language, which you just keep refusing to do.

[00:21:04] Speaker 01:
You want to hide behind PVA, but you won't defend it in light of the language of the statute.

[00:21:09] Speaker 01:
And you've got a conflicting case that came out before PVA.

[00:21:13] Speaker 01:
So this is your problem.

[00:21:14] Speaker 01:
You need to tell me why the statute

[00:21:16] Speaker 01:
gives or doesn't give us review authority, you need to stop trying to hide behind a case because these two cases are in conflict.

[00:21:24] Speaker 01:
So do you have any justification for why this statute justifies your position?

[00:21:30] Speaker 00:
Yes, because there's a distinction between when the VA is acting in its rulemaking capacity and when it's advising the board

[00:21:39] Speaker 00:
in its adjudication of a particular veteran's claim.

[00:21:42] Speaker 00:
And that's what PDA addressed.

[00:21:44] Speaker 03:
It found that... But I guess this is what I don't really get.

[00:21:50] Speaker 03:
The general counsel issues what the general counsel calls a precedential opinion, answering a couple of general legal questions.

[00:22:01] Speaker 03:
And what is it, 7104C?

[00:22:03] Speaker 03:
Is that the provision that says this actually binds

[00:22:08] Speaker 03:
the board in the future.

[00:22:10] Speaker 03:
How is that something other than a rule under 550 to A1D?

[00:22:21] Speaker 00:
The distinction is that rather than acting in its rulemaking capacity, the VA was providing legal advice to the board on a pending appeal and a pending veteran's claim.

[00:22:38] Speaker 04:
And we recognize- If I could just clarify something.

[00:22:42] Speaker 04:
Are you saying there's two different categories of general counsel presidential letters?

[00:22:48] Speaker 00:
Yes.

[00:22:49] Speaker 04:
There's one that is issued unrelated to any proceeding in front of the board, and then there's another kind that is related to a proceeding with the board.

[00:22:59] Speaker 04:
But I guess for me, the struggle I have is they have the same end result effect.

[00:23:06] Speaker 04:
It's true that one category of letters

[00:23:08] Speaker 04:
might directly impact the outcome of a proceeding before the board.

[00:23:12] Speaker 04:
But in the end, they're both binding on the agency.

[00:23:17] Speaker 00:
They are binding, but the distinction is how and why they originate.

[00:23:21] Speaker 00:
And I agree that there are other categories of general counsel's opinions which are not issued in connection with

[00:23:29] Speaker 00:
adjudication of a particular veteran's appeal that would be directly reviewable by this court under 502.

[00:23:35] Speaker 04:
I guess it's not clear to me why the motivation for why the GC issued its presidential letter matters.

[00:23:43] Speaker 00:
It matters because this court in Wayne didn't reach

[00:23:48] Speaker 00:
the second sentence of 502 didn't opine as to its meaning.

[00:23:52] Speaker 00:
And as the Supreme Court has stated, where a case didn't directly confront a question before it, or where questions of jurisdiction had been passed on in prior decisions subsilentio, the court should not consider itself bound in a subsequent decision.

[00:24:05] Speaker 01:
What about the regulation 38 CFR 14.507, which actually lays out, I think, pretty clearly the two types of general counsel opinions that Judge Chen was referring to.

[00:24:17] Speaker 01:
A says there are advisory-only opinions.

[00:24:20] Speaker 01:
They have to be designated as such.

[00:24:21] Speaker 01:
And B says there are presidential opinions, which have to be designated as such.

[00:24:26] Speaker 01:
And B goes on to say, any written legal opinion designated as presidential shall be considered by the Department of Veterans Affairs to be subject to the provisions of 5 USC 552A1.

[00:24:39] Speaker 00:
Again, Your Honor, the distinction

[00:24:42] Speaker 00:
And this is what the court and PDA interpreted.

[00:24:46] Speaker 00:
And again, we acknowledge that there may be more than one reasonable interpretation of that second sentence of 502.

[00:24:52] Speaker 00:
But that was a matter for the panel and PDA.

[00:24:55] Speaker 00:
And they have reached that.

[00:24:56] Speaker 00:
The question of jurisdiction was not raised in Slane.

[00:25:00] Speaker 03:
I'm sorry, but that's not really true.

[00:25:02] Speaker 03:
The question of jurisdiction was raised.

[00:25:05] Speaker 03:
This is not a case that falls under, I think, any of the

[00:25:11] Speaker 03:
decisions that you cite for quite accepted proposition that sub-silencio rulings don't have binding effect when the matter comes up again.

[00:25:23] Speaker 03:
But this was not sub-silencio.

[00:25:24] Speaker 03:
Splane expressly reaches a conclusion.

[00:25:27] Speaker 03:
And it's true that it didn't do so in the face of a contest on the issue.

[00:25:35] Speaker 03:
But the government's brief is explicit about it.

[00:25:39] Speaker 03:
respondent does not disagree with the assertion that the general counsel's opinion may be reviewed under 502 as a 552A1 matter.

[00:25:49] Speaker 03:
This is really not quite one of those sub-silencio cases.

[00:25:53] Speaker 00:
I believe the reason that it is sub-silencio is that, well, first of all, that party cannot find it sub-silencio.

[00:25:57] Speaker 03:
I mean, literally, it's not sub-silencio, right?

[00:26:00] Speaker 00:
But it was, Spleen was silent as to the effect of that second sentence of 502.

[00:26:04] Speaker 00:
And so, PVA is the only decision of this court to speak to what that second sentence of 502 means.

[00:26:11] Speaker 00:
And while acknowledging that it's not presidential, when this exact issue was raised again in American Legion in 2008, that's what the panel there found, that the decision was squarely controlled by PDA.

[00:26:28] Speaker 00:
I'm well into my time, so I'd like to address any questions that the court may have as to whether it does exercise jurisdiction, the interpretation

[00:26:41] Speaker 00:
in the GC council's opinion.

[00:26:42] Speaker 01:
I'm curious about a side issue.

[00:26:45] Speaker 01:
Um, I think that my understanding of the facts is pretty close to correct if not correct in terms of Mr. Snyder, um, having accepted the case worked for only a period of months, uh, basically withdrew from representation.

[00:27:02] Speaker 01:
The case went on for a full two additional years before the backs finally succeeded in their claim.

[00:27:08] Speaker 01:
And then he kind of swoops in at the end with his request for 20% of all the money they got.

[00:27:15] Speaker 01:
Why out of curiosity did the initial decision from, is it the board or the VA, whoever made the initial decision, did they consider all of this in deciding whether he was entitled to 20% or not?

[00:27:28] Speaker 01:
I know that this case ultimately is about whether she, his widow, has the right to appeal or whether the claim ended with his life.

[00:27:35] Speaker 01:
But I'm curious, what was the basis for the decision below to give him the $40,000 of the veteran's money?

[00:27:43] Speaker 00:
So the initial opinion, and it's just that, it's just an initial opinion, not a final decision on the matter, found that there's basically two issues under 5904.

[00:27:54] Speaker 00:
Eligibility, meaning is this the agreement that's structured the way an agreement under 5904 must be, is it capped at 20%?

[00:28:05] Speaker 00:
Was it actually signed by the veteran?

[00:28:12] Speaker 00:
That's eligibility.

[00:28:13] Speaker 00:
And the initial decision addressed eligibility.

[00:28:15] Speaker 00:
However, there is a second element of 5904 under C2, which permits for a reasonableness review.

[00:28:24] Speaker 00:
And that may be raised by the board directly or by party.

[00:28:29] Speaker 00:
And that was true at the time of the 2001 statute as well.

[00:28:33] Speaker 00:
And it's that second piece that allows for a reasonableness review and a reduction of fees where the fee is not reasonable or excessive.

[00:28:40] Speaker 01:
And is that where the agency actually asked Mr. Schneider to come in and justify what hours he had spent and what work he had done to warrant the $40,000?

[00:28:49] Speaker 00:
Yes.

[00:28:49] Speaker 00:
So that pending appeal- Okay.

[00:28:50] Speaker 00:
So that was what was pending when Mr. Beck died.

[00:28:52] Speaker 00:
That was pending when Mr. Beck died.

[00:28:53] Speaker 00:
I understand.

[00:28:54] Speaker 00:
And that is the claim, that pending claim.

[00:28:57] Speaker 00:
And in Mason v. Shinsinki, this court has held that a claim where there's a direct

[00:29:05] Speaker 00:
fee request and a challenge to that, that those are simultaneously contested claims.

[00:29:10] Speaker 00:
Mr. Beck was challenging that claim.

[00:29:13] Speaker 00:
When he died, the accrued benefits claim and statute allows

[00:29:18] Speaker 00:
his survivor to step into his shoes in a derivative claim and to step into the exact place.

[00:29:24] Speaker 00:
And we acknowledge that Congress did not speak in 5904 to what would happen on a veteran's death.

[00:29:32] Speaker 00:
And in 5121, the accrued benefits statute does not explicitly allow

[00:29:42] Speaker 00:
Excuse me, a 5-1-2-1 explicitly allows an accrued claimant benefit to pursue a claim but doesn't speak to an attorney's fees question.

[00:29:51] Speaker 00:
In interpreting these two statutes, the general counsel correctly applied the canon of construction that if you could read both statutes to give effect to both,

[00:30:02] Speaker 00:
you should do so.

[00:30:03] Speaker 00:
And it found that an accrued benefits claimant would be able to bring a claim, a pending claim here, challenging reasonableness, just as it would any other pending claim.

[00:30:18] Speaker 00:
And the distinction that council is trying to make between a periodic monetary benefit that's no longer being a periodic monetary benefit, that's really just a red herring because accrued benefits are

[00:30:32] Speaker 00:
Periodic monetary benefits, the Veterans Court has addressed that in Nolan, even when they're paid in a lump sum payment.

[00:30:39] Speaker 00:
It distinguishes those from payments that are only made in a lump sum, like certain housing benefits, or Nolan gives the example of certain auto purchase payments.

[00:30:49] Speaker 00:
But what Mr. Snyder is arguing here is that

[00:30:53] Speaker 00:
once the money is reserved as the potential attorney's fees, subject to a reasonableness challenge, that if the veteran dies, then the reasonableness challenge is out the window.

[00:31:03] Speaker 00:
And it doesn't matter if the fee is excessive or unreasonable.

[00:31:07] Speaker 00:
The accrued benefits claimant can't step in.

[00:31:11] Speaker 00:
But again, under Mason, this court has said that a claim for money like this, one pot of money,

[00:31:19] Speaker 00:
sought by an attorney on one side and a claimant on the other is a simultaneously contested claim.

[00:31:24] Speaker 00:
And there's no reason that Ms.

[00:31:27] Speaker 00:
Beck wouldn't be able to pursue this claim.

[00:31:29] Speaker 03:
Can I ask you before you sit down, can you get the money back from Mr. Snyder?

[00:31:34] Speaker 00:
Yes, there are provisions that allow for that.

[00:31:39] Speaker 00:
And again, even the error.

[00:31:42] Speaker 04:
Can I ask something now?

[00:31:43] Speaker 04:
Yes.

[00:31:44] Speaker 04:
When the board ruled back in 2003 that

[00:31:49] Speaker 04:
he had a service connection for his injury and was entitled to $200,000.

[00:31:52] Speaker 04:
Was $160,000 paid out to him and then $40,000 held back?

[00:32:00] Speaker 00:
Yes.

[00:32:00] Speaker 00:
The $160,000 was paid.

[00:32:03] Speaker 00:
$40,000 was reserved.

[00:32:04] Speaker 00:
But again, that $40,000... And where is the $40,000 now?

[00:32:06] Speaker 00:
The $40,000 is with the attorney.

[00:32:09] Speaker 04:
So it was paid out after he was deemed eligible, but

[00:32:16] Speaker 04:
There hadn't yet been a ruling on whether it was reasonable.

[00:32:19] Speaker 00:
It was paid out after his death because the procedure is for any pending appeals, whether or not a possibility for substitution under 5121 large A to be dismissed.

[00:32:32] Speaker 00:
And while there is then the possibility for a derivative claim by an approved benefits claimant, this is an unusual situation.

[00:32:39] Speaker 00:
It was a case of first impression for the board.

[00:32:45] Speaker 00:
RO rather than waiting for the period in which Mrs. Vett could bring her derivative claim or reaching out to see if she was going to bring one that issued that money.

[00:32:55] Speaker 00:
But the best practice would have been to hold that payment to see if there was more than one party seeking entitlement to all or a portion of that money.

[00:33:09] Speaker 01:
Okay, thank you.

[00:33:11] Speaker 01:
Mr. Carpenter, you have some rebuttal time.

[00:33:13] Speaker 01:
And since the government went extra over by a minute, let's put three minutes of rebuttal time off.

[00:33:21] Speaker 02:
Thank you, Your Honor.

[00:33:23] Speaker 02:
I believe that the representative of the VA has misstated the law.

[00:33:29] Speaker 02:
The initial decision on the fee was just that.

[00:33:33] Speaker 02:
It was a decision.

[00:33:34] Speaker 02:
It was not an opinion.

[00:33:36] Speaker 02:
And it was an opinion that the VA ultimately acted upon.

[00:33:41] Speaker 02:
There has also been a suggestion by the government that the issue of reasonableness was raised.

[00:33:47] Speaker 02:
Yes, the issue of reasonableness was raised, but it was raised in the notice of disagreement on the question of eligibility or entitlement to charge a fee.

[00:33:55] Speaker 02:
There is a specific statutory provision that requires the issue of reasonableness at that time to be raised directly to the board.

[00:34:04] Speaker 02:
The issue of reasonableness was never, during the life of Mr. Beck, raised to the Board.

[00:34:11] Speaker 02:
The Board had authority to sua sponte raise the issue.

[00:34:15] Speaker 02:
The Board, during the lifetime of Mr. Beck, never sua sponte raised the issue of reasonableness.

[00:34:21] Speaker 04:
Mr. Carpenter, everything you're talking about now, I mean, this is good background information, but it's not related to what we have to confront in this appeal, is that right?

[00:34:33] Speaker 02:
It is tangentially related because the government has suggested that this case has a separate status relative to reasonableness.

[00:34:43] Speaker 02:
And it does not.

[00:34:44] Speaker 02:
This case is limited to the question of eligibility.

[00:34:48] Speaker 02:
And that question of eligibility was favorably decided and then acted upon, and those funds were distributed to Mr. Snyder.

[00:34:58] Speaker 04:
I thought we just have to figure out whether the GC's letter is permissible under the statute.

[00:35:08] Speaker 04:
Yes, is that right?

[00:35:10] Speaker 04:
So we don't need to get into the story of what happened with Mr. Snyder's claim for these fees.

[00:35:19] Speaker 02:
It relates to the question of what is pending before the agency.

[00:35:23] Speaker 02:
What is this

[00:35:25] Speaker 04:
Right, but that's not pending before us right here, right now.

[00:35:28] Speaker 02:
No, Your Honor.

[00:35:29] Speaker 02:
But what is pending before you is whether or not this is or is not the attorney fee monies an accrued benefit.

[00:35:37] Speaker 02:
It cannot be an accrued benefit.

[00:35:39] Speaker 02:
An accrued benefit, contrary to what the government said, is not a derivative claim in the sense that you get the right to a derivative claim.

[00:35:48] Speaker 02:
You only get the right to a derivative claim if there are periodic monetary benefits

[00:35:54] Speaker 02:
due and unpaid.

[00:35:56] Speaker 02:
As you correctly observed, Judge Jinn, these monies were not due and unpaid.

[00:36:02] Speaker 02:
They were, in fact, paid $140,000 to Mr. Beck, or excuse me, $160,000 to Mr. Beck, and $40,000 to Mr. Seiner.

[00:36:11] Speaker 02:
That slate is done.

[00:36:13] Speaker 02:
There are no due and unpaid benefits under 5121A.

[00:36:18] Speaker 02:
And for the general counsel opinion to interpret 5904

[00:36:24] Speaker 02:
to create accrued benefits is simply inconsistent with both statutes.

[00:36:30] Speaker 01:
Thank you very much, Mr. Carpenter.

[00:36:32] Speaker 01:
We thank both counsel for their arguments.

[00:36:33] Speaker 01:
The case is taken under submission.

[00:36:37] Speaker ?:
All rise.

[00:36:51] Speaker ?:
Hi.

[00:36:52] Speaker ?:
The Honorable Court will take a short recess.

[00:37:35] Speaker 03:
Thank you.

[00:37:50] Speaker ?:
Thank you.