Jоse V. KUPPAMALA, Appellant, v. Robert A. McDONALD, Secretary of Veterans Affairs, Appellee.
No. 14-2449.
United States Court of Appeals for Veterans Claims.
Decided Dec. 30, 2015.
27 Vet. App. 447
Argued Oct. 14, 2015.
Before DAVIS, SCHOELEN, and BARTLEY, Judges.
SCHOELEN, Judge:
The appellant, Jose V. Kuppamala, through counsel, appeals a June 27, 2014, Board of Veterans’ Appeals (Board) decision in which the Board denied his claim for a rating in excess of 50% for ulcerative colitis, status post colectоmy. Record of Proceedings (R.) at 3-7. This appeal is timely, and the Court has jurisdiction to review the Board‘s June 2014 decision pursuant to
I. BACKGROUND
Mr. Kuppamala served on active duty in the U.S. Air Force from September 1987 to September 1991. R. at 254. In August 2000, Mr. Kuppamala submitted a formal claim for disability compensation for ulcerative colitis. R. at 342-46. A December 2001 rating decision granted service connection for ulcerative colitis under Diagnostic Code (DC) 7323 with a 10% disability rating, effective August 16, 2000. R. at 255-61. After receiving medical records from November 2002 showing that Mr. Kuppamala underwent a total colectomy for his chronic ulcerative colitis (R. at 230-37), the VA regional office (RO) issued a February 2003 rating decision increasing his disability rating for ulcerative colitis to 20%, effective from March 12, 2002, to October 31, 2002, and to 100% from October 31, 2002, to January 1, 2003; and assigned a 10% disability rating from January 1, 2003 (R. at 226-29).3 In May 2003, Mr. Kuppamala underwent a VA digestive conditions examination in which he reported symptoms of chronic fatigue and chronic diarrhea following his colon resection. R. at 213-19. That same month, VA assigned a 40% disability rating under DC 7329 for residuals of resection of the large intestine from January 31, 2003; 40% is the highest available rating under DC 7329. R. at 209-11.
In July 2007, Mr. Kuppamala filed a claim for an increased rating for ulcerative colitis asserting that “the condition has
A January 2008 rating decision continued the 40% disability rating. R. at 158-62. Thereafter, Mr. Kuppamala timely appealed to the Board. R. at 130-31, 132-44, 152-55. In his Substantive Appeal, Mr. Kuppamala reported experiencing weight loss, loss of appetite, reduced energy, and disrupted sleep that caused problems with memory and concentration—all related to his frequent daytime and nighttime bowel movements. R. at 130-31. In March 2010, Mr. Kuppamala submitted a letter explaining that he suffered from physical and emotional distress because of his frequent bowel movements and asserting that he experienced “low back pain and leg pain 3 times last year due to frequently need[ing] to go to the restroom.” R. at 100.
In an April 2010 VA examination, Mr. Kuppamala endorsed a 20-pound weight loss and occasional incontinence. R. at 102. The examiner also noted “daily diarrhea” and observed that Mr. Kuppamala‘s symptoms interfered with his work as an x-ray technician because he “will have to stop in the middle of x-rays with patients [and] go to the bathroom [and] sometimes doesn‘t get there in time.” Id. Mr. Kuppamala was not able to perform jury duty because “he would never be able to sit in a courtroom without needing to go to the bathroom many times.” Id. Mr. Kuppamala also described being very concerned about being аble to locate a bathroom in time when on vacation and while flying or driving his children to school. Id. The examiner noted that “[i]f [Mr. Kuppamala] goes to social functions, [he] must think whether or not a bathroom will be [available and] may skip the function if he doesn‘t think a bathroom will be available to him[;] he does no outside camping.” Id.
In a December 2011 Board decision, the Board remanded Mr. Kuppamala‘s claim “for consideration of extraschedular entitlement, to include a referral to the Director of Compensation and Pension Service.” R. at 54. In May 2012, the Director found that the rating schedule under DC 7323-29 does “not address the frequency of the severe symptoms” and that the “frequency of the symptoms presents the exceptional or unusual disability picture affecting [Mr. Kuppamala‘s] ability to perform his occupational duties as an x-ray technician causing marked interference with employment.” R. at 45. The Director decided that an extraschedular evaluation was warranted and awarded a 10% extraschedular rating. R. at 46. Subsequently, VA implemented the Director‘s decision and increased Mr. Kuppamala‘s disability rating for his service-connected ulcerative colitis to 50%, effective July 23, 2007. R. at 35-44. Mr. Kuppamala appealed this extraschedular rating. R. at 18.
In the June 2014 decision on appeal, the Board noted that Mr. Kuppamala‘s symptoms of frequent loose bowel movements and bowel incontinence left him unable to work alone оr in specialty clinics because he needs to use the bathroom so often. R. at 6. The Board then summarized the Di
II. THE PARTIES’ ARGUMENTS
Mr. Kuppamala argues that the Board failed to fulfill its obligation to provide a de novo review of the Director‘s decision. Appellant‘s Brief (Br.) at 5, 9. He asserts that the Board merely repeated the Director‘s analysis—which is improper both because the Director‘s decision is not evidence and because the Board was obligated to conduct its own independent review of the evidence and provide adequate reasons or bases for its decision. Id. at 9-10. Consequently, he contеnds, the Board did not fully consider other symptoms beyond the frequency of his bowel movements—including weight loss, loss of appetite, disturbed sleep, fatigue, memory and concentration problems, and low back and leg pain—that make up his complete disability picture. Id. at 11-12. Mr. Kuppamala argues that had the Board properly considered these symptoms, the Board may have found he was entitled to a higher rating. Id. at 14.
The Secretary responds that neither the Board nor the Court has the authority to review the Director‘s decision awarding an extraschedular rating. Secretary‘s Br. at 8. The Secretary identifies four reasons why the Director‘s decision is discretionary and not subject to review: (1) Awarding an extraschedular rating is a policy-based decision; (2) there are no manageable judicial standards for the Board to apply and the Board lacks the necessary expertise to assign an extraschedular rating; (3) the plain language of
III. ANALYSIS
A. The Scope of the Board‘s Jurisdiction
This case raises a question of the Board‘s jurisdiction: Whether the Board has jurisdiction to review the Director‘s assignment of an extraschedular rating.4 Section 511(a) of title 38, U.S.Code, states that “[t]he Secretary shall decide all questions of law and fact necessary to a decision by the Secretary under a law that affects the provision of benefits by the Secretary to veterans or the dependents or survivors of veterans.”
The Board is an agent of the Secretary, as are the ROs. Disabled Am. Veterans v. Sec‘y of Veterans Affairs, 327 F.3d 1339, 1346-47 (Fed. Cir. 2003) (citing
(a) All questions in a matter which under section 511(a) of this title is subject to decision by the Secretary shall be subject to one review on appeal to the Secretary. Final decisions on such appeals shall be made by the Board. Decisions of the Board shall be based on the entire record in the proceeding and upon consideration of all evidence and material of record and applicable provisions of law and regulation.
The Federal Circuit has еxplained that “[t]ogether, §§ 511(a) and 7104(a) dictate that the Board acts on behalf of the Secretary in making the ultimate decision on claims and provides ‘one review on appeal to the Secretary’ of a question ‘subject to decision by the Secretary’ under § 511(a).” Disabled Am. Veterans, 327 F.3d at 1347. Importantly, section 7104, unlike this Court‘s jurisdictional statute, does not limit the Board‘s ability to review favorable findings. Compare
1. Judicially Manageable Standards for Review of the Director‘s Extraschedular Decision
At oral argument, relying on Werden, the Secretary argued that here there are no judicially manageable standards governing the Director‘s decision as to extraschedular ratings and that, therefore, it would be impossible for the Board to review the decision. Rather, the Secretary suggests that the Board‘s only obligation is to recognize that the Director made the decision and assigned a particular rating.5 For the reasons discussed below, the Court disagrees.
In Werden, the appellant challenged the Board‘s decision that it lacked jurisdiction to review the manner in which VA dispersed the appellant‘s special adaptive housing grant. 13 Vet. App. at 466. The authorizing regulation gave the Secretary
Accordingly, the Court must consider whether the statute and regulation governing extraschedular ratings committed the assignment of a rating solely to the Secretary‘s discretion. As the Secretary acknowledged at oral argument, the authority for
The governing regulation,
To accord justice, therefore, to the exceptional case where the schedular evaluations are found to be inadequate, the Under Secretary for Benefits or the Director, Compensation and Pension Service, upon field station submission, is authorized to approve on the basis of the criteria set forth in this paragraph an extra-schedular evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities. The governing norm in these exceptional cases is: A finding thаt the case presents such an exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of the regular schedular standards.
Id. (emphasis added). Thus, as the Secretary discussed at oral argument, VA may only assign an extraschedular rating based on the “analytic formula” identified in section 1155: the average earning capacity impairment resulting from the service-connected disabilities. Oral Arg. at 33:42.
Currently, average impairment in earning capacity is not a clearly defined standard. The Secretary suggests that requiring the Board to review the Director‘s decision and consider the average impairment in earning capacity puts the Board in an impossible situation because the Board lacks the expertise the Director has necessary for assigning an extraschedular rating. The fact that the Secretary has not elected to provide more guidance explaining how to ascertain the average impairment in earning capacity is neither uncommon6 nor an adequate reason to isolate the
Moreover, as the Director‘s decision here illustrates, extraschedular consideration is not a question of opinion or discretion, but one of fact. In reaching his decision, the Director relied on the April 2010 examination, noting Mr. Kuppamala‘s “severe symptoms of about 14 bowel movements a day” and that he occasionally has to leave an x-ray session to use the bathroom and also experiences episodes of incontinence. R. at 45. The Director cоncluded that the rating schedule did not contemplate the frequency of Mr. Kuppamala‘s symptoms and that the frequency of his symptoms “presents the exceptional or unusual disability picture affecting his ability to perform his occupational duties as an X-ray technician causing marked interference with employment.” Id. Clearly, this is a fact-driven analysis assessing a veteran‘s unique disability picture and whether that picture results in an average impairment in earning capacity significant enough to warrant an extraschedular rating. Therefore, the Court finds that where, as here, the statute and regulation provide “a judicially manageable standard limiting the Secretary‘s discretion, the Board must review the Secretary‘s decision to [е]nsure that it was made within the statutory or regulatory confines.” Werden, 13 Vet. App. at 467.
2. Policy Decision Argument
Although there is a judicially manageable standard, the Secretary still argues that the plain language of the regulation—in particular the phrase “to accord justice“—precludes review by the Board because this language indicates that extraschedular consideration involves a policy decision. Oral Arg. at 16:04. He maintains that the purpose of § 3.321(b) was to provide, as a matter of equity, an additional rating in the exceptional case not contemplated by the rating schedule. Id. at 31:11. First, the Court notes that
3. Reasons or Bases
The Secretary suggests that the Board‘s review of the Director‘s decision is limited to merely noting the fact that the Director made a decision. Oral Arg. at 21:00. He argues that an extraschedular award is part of the regular claims process because the relevant “fact” the Board must note “is simply what the Director determined.” Oral Arg. at 32:57. The Board is the final authority on benefits decisions yеt the review the Secretary endorses is nothing more than lip service to this principle. The Court is perplexed by the Secretary‘s assertion that even if the Director made a clear factual misstatement in his decision, the veteran would have no recourse but to seek private relief or a change in law from Congress. Oral Arg. at 23:20. “The purpose of appellate review ... is to ensure that the facts found and laws applied were appropriate.” Werden, 13 Vet. App. at 467. An inaccurate or incomplete decision from the Director frustrates that review. Accordingly, the Court further finds that to allow for a proper review, the Board must have before it an actual decision complete with a statement of reasons or bases.
Contrary to the Secretary‘s assertion at oral argument, the Director may not issue a decision assigning an extraschedular rating that merely states that “an extraschedular rating of 10% is warranted.” Oral Arg. at 37:38. When the Director acts in the context of extraschedular ratings, he is taking the place of an RO adjudicator. Wages, 27 Vet. App. at 238 (“In short, the Director‘s decision is no different than an RO‘s decision in terms of its effect on the Board‘s statutory jurisdiction and the Board‘s standard of review.“) (citing Disabled Am. Veterans v. Sec‘y of Veterans Affairs, 419 F.3d 1317, 1319 (“[T]he Board conducts de novo review of [RO] prоceedings based on the record.“)). Extraschedular consideration under § 3.321(b) is part of the claims process even though there are additional procedural requirements—referral to the Director—that must be followed. Floyd, 9 Vet. App. at 96. The actual review of the matter is done for the first time by the Secretary. Anderson, 22 Vet. App. at 428. Any award made by the Director is then
B. Board‘s Authority To Assign an Extraschedular Rating
Having determined that the Board has authority to review the entirety of the Director‘s decision, the Court next addresses what remedy the Board may provide. Specifically, may the Board assign an extraschedular rating? For the reasons that follow, the Court holds that it may.
The Secretary argues that the Board may not assign an extraschedular rating because the Board lacks the expertise necessary to review the Director‘s assessment of the average impairment in earning capacity resulting from the individual‘s disability picture. This argument is out of step with the Court‘s caselaw specifically addressing § 3.321(b)(1).
In Floyd v. Brown, 9 Vet. App. 88, 94 (1996), the Board sua sponte granted the appellant a 10% extraschedular evaluation. Rather than finding, as the Secretary now argues, that the Board may neither assign nor review the assignment of an extraschedular evaluation, the Court, relying on sections 511(a) and 7104(a), found that § 3.321(b)(1) precludes the Board from “assigning such a rating in the first instance.” Id. at 94-95. Prohibiting the Board from assigning an extraschedular rating in “the first instance” logically suggests that once the Director has made an initial determination, the Board may assign an extraschedular rating thereafter.
This conclusion is further supported by Anderson v. Shinseki. In Anderson, the Board reviewed the Director‘s denial of an extraschedular rating. 22 Vet. App. at 426-27. The Court expressly rejected the appellant‘s efforts to parse the elements of Thun intо individual binding decisions, clarifying that each step of the three-step inquiry announced in Thun is an “element[] that must be established before an extraschedular rating can be awarded and ... they are reviewable by the Board.” Id. at 427. Also relying on § 7104(a), the Court in Anderson stated that “the Board is permitted to review the entirety of the proceedings below.” Id. at 428. Notably, although in Anderson, the Director ultimately denied an extraschedular rating, there is no discernable distinction between the Board‘s ability to review a denial of an extraschedular rating and review of an award of an extraschedular rating. Id. (noting that “the Board‘s review of the RO‘s decision that Mr. Anderson was not entitled to a hearing loss greater than 10% included a review of whether an extraschedular rating was warranted“) (emphasis added). The only cleаr limitation on the Board‘s review is the Director‘s specific regulatory authority to approve extraschedular awards in the first instance. Id.
Despite an opportunity to do so, neither Floyd nor Anderson adopted an interpretation of § 3.321(b)(1) that sets the Director‘s decision outside the Board‘s jurisdiction under sections 511(a) and 7104(a) to make the final decision for the Secretary. Instead, these decisions only preclude the Board from assigning an extras
Additionally, the Court disagrees that the Board lacks the requisite experience necessary to assign an extraschedular rating. As noted above, the entire rating schedule is governed by the average impairment in earning capacity resulting from service-connected disabilities.
Finally, аlthough the Secretary argues that the Court‘s holding in this case will render § 3.321(b) unworkable and undermine the Secretary‘s intention to provide extraschedular ratings “to accord justice,” this argument is without merit. As discussed above, despite invoking the word “justice,” extraschedular consideration under § 3.321(b) is a decision governed by law, with discernable standards, and not equity. If the Secretary had intended extraschedular ratings to be equitable decisions, the statutory authority for the regulation would come from
As to the Secretary‘s assertion that extraschedular ratings are a policy consideration, the policy decision was made when the Secretary promulgated the regulation allowing for extraschedular ratings to account for exceptional circumstances. This delegation serves multiple purposes. First, it allows the Director to exercise his expertise in the first instance. While not evidence, this decision may serve to inform the Board‘s review. See Wages, 27 Vet. App. at 239 (finding that the Director‘s decision is not evidence). Additionally, limiting the initial grant of an extraschedular rating to the Director instead of the many ROs across the country provides a degree of uniformity over these exceptional decisions. Referral also keeps the Director apprised of the number and type of unique disability cases allowing the Secretary to satisfy his obligation to, “from time to time[,] readjust th[e] schedule of ratings in accordance with experience.”
C. The Decision on Appeal
Having found that the Board has the authority to reviеw the Director‘s entire decision de novo, the Court will now address the Board decision on appeal. The Board must provide a statement of the reasons or bases for its determination, adequate to enable an appellant to understand the precise basis for the Board‘s decision as well as to facilitate review in this Court.
Ulcerative colitis is rated under DC 7323, which provides for a 100% disability rating where the condition is “[p]ronounced; resulting in marked malnutrition, anemia, and general debility, or with serious complication as liver abscess.”
In the decision on appeal, the Board discussed Mr. Kuppamala‘s frequent bowel movements and bowel incontinence that prevented him from working alone or in specialty clinics and caused him to miss work. R. at 6. The Board then summarized the Director‘s decision, noting the Director‘s finding that the rating sсhedule was inadequate because it did not address the frequency of Mr. Kuppamala‘s symptoms and assigning a 10% extraschedular rating in addition to the veteran‘s 40% schedular rating, for a combined 50% disability rating. Id. The Board then summarily concluded that the 50% disability rating was appropriate. Id. As Mr. Kuppamala points out, the Board did not discuss the VA medical examinations or address his symptoms of loss of appetite, weight loss, chronic fatigue, problems with memory and concentration, and lower back and leg pain—all of which he reports affect his ability to work. Appellant‘s Br. at 11-12.
As demonstrated by the Board‘s summary, the Director‘s decision focused on the frequency of his bowel movements. R. at 45-46. Neither the Director nor the Board addressed Mr. Kuppamala‘s symptoms—including weight loss, loss of appetite, disturbed sleep, fatigue, memory and concentration problems, and low back and leg pain—that are part of his complete disability picture. R. at 6. Mr. Kuppamala argues that he suffers from “more than frequent diarrhea” and that had the Board addressed this evidence, it may have found that the Director‘s analysis was incomplete. Appellant‘s Reply Br. at 3. The Secretary even acknowledged that this evidence was a “critical part of the analysis.” Oral Arg. at 28:45. The Court agrees that the Board needed to discuss this evidence. Floyd, 9 Vet. App. at 96-97 (noting that when an appellant appeals an extraschedular rating to the Board, “the Board will be required to articulate its findings of fact and sufficient reasons and bases on the extraschedular consideration issue“). The Board‘s limited analysis frustrates the Court‘s ability to review the Board‘s assessment of Mr. Kuppamala‘s disability picture. Cf. Anderson, 22 Vet. App. at 429 (finding that “because the Board‘s description of [the appellant‘s] disability picture presented by the record is incomplete, its analysis of whether that disability picture is adequately contemplated by the rating schedule is necessarily flawed“); see also Allday and Caluza, both supra. Accordingly, the Court will remand this matter for proceedings consistent with this decision.
On remand, the appellant is free to submit additional evidence and argument on the remanded matters, 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) (pеr curiam order). The Court has held 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). The Board must proceed expeditiously, in accordance with
IV. CONCLUSION
Upon consideration of the foregoing, the June 27, 2014 Board decision is VACATED and REMANDED for further proceedings consistent with this decision.