NATIONAL ORGANIZATION OF VETERANS ADVOCATES, INC., Petitioner v. SECRETARY OF VETERANS AFFAIRS, Respondent.
No. 2015-7024.
United States Court of Appeals, Federal Circuit.
Jan. 13, 2016.
809 F.3d 1359
We do not foreclose the application of the common fund doctrine in all instances in which a fee-shifting statute is present. Equity may sometimes deem it appropriate to give counsel a piece of either the final judgment or settlement agreement. See id. (positing that it may “sometimes [be] appropriate to give [counsel] a slice of the class‘s recovery on top of a fee-shifting award“); see also Brytus, 203 F.3d at 247 (“This is not to say that the common fund doctrine may never be applied in a case for which there is a statutory fee provision....“). At its heart, equity is about fairness. See Petrella, 134 S.Ct. at 1977 (asserting that equity may still intervene to address a party‘s conduct in certain circumstances).
In the present case, the URA provision was expressly enacted with the primary purpose of rendering property owners whole and fee recovery is governed by statute. The URA provides a reasonable fee and thus forecloses application of the common fund doctrine.
CONCLUSION
We reverse the Claims Court‘s approval of the settlement agreement and award of attorney fees under the common fund doctrine and remand for further consideration consistent with the foregoing. The Claims Court‘s decision is
VACATED AND REMANDED
Kenneth M. Carpenter, Law Offices of Carpenter Chartered, Topeka, KS, argued for petitioner.
Elizabeth Marie Hosford, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for respondent. Also represented by Benjamin C. Mizer, Robert E. Kirschman, Jr.; Y. Ken Lee, Amanda R. Blackmon, Office of General Counsel, United States Department of Veterans Affairs, Washington, DC.
BRYSON, Circuit Judge.
The National Organization of Veterans’ Advocates, Inc. (“NOVA“) petitions this court for review of certain regulations promulgated by the Department of Veterans Affairs (“DVA“). The challenged regulations, which are codified at
Prior to the enactment of the Veterans’ Benefits Improvement Act, if a veteran seeking DVA benefits died while his claim was pending, the veteran‘s survivor could not take the place of the veteran and continue to prosecute the claim. Instead, the survivor would have to file a claim for accrued benefits under
The 2008 Act sought to remedy that situation. Section 212 of the Act, codified as
In 2011, the DVA proposed regulations to implement section 5121A. Substitution in Case of Death of Claimant (“Proposed Rule“), 76 Fed.Reg. 8,666 (Feb. 15, 2011). After notice and an opportunity for comment, the DVA published the final version of the regulations. Substitution in Case of Death of Claimant (“Final Rule“), 79 Fed. Reg. 52,977 (Sept. 5, 2014).
The regulations require a request to substitute to be filed with the agency of original jurisdiction (such as one of the DVA‘s regional offices) within one year of the claimant‘s death; the prospective substitute is required to submit evidence of his eligibility to substitute.
NOVA filed an original proceeding in this court under
II
NOVA first challenges the requirement that prospective substitutes provide evidence of their eligibility in all cases. In some cases a veteran receiving disability benefits is entitled to receive additional benefits because of his dependents. Those same dependents may also be eligible to substitute for that veteran after his death. Compare
NOVA argues that when a claimant before the Board has been receiving additional benefits because of a spouse, child, or dependent parents, the Board should allow the prospective substitutes to move to be substituted and have the Board determine eligibility based on the material the DVA already has in the deceased claimant‘s file. According to NOVA, the
The DVA responds that the pertinent provision of the 2008 Act,
The relevant portion of section 5121A states:
(1) If a claimant dies while a claim for any benefit under a law administered by the Secretary, or an appeal of a decision with respect to such a claim, is pending, a living person who would be eligible to receive accrued benefits due to the claimant under section 5121(a) of this title may, not later than one year after the date of the death of such claimant, file a request to be substituted as the claimant for the purposes of processing the claim to completion.
(2) Any person seeking to be substituted for the claimant shall present evidence of the right to claim such status within such time as prescribed by the Secretary in regulations.
The DVA interprets section 5121A to require the prospective substitute to put forward evidence of eligibility to substitute. Eligibility to substitute under section 5121A is governed by subsection 5121(a), which determines eligibility based on the person‘s relationship to the veteran at the time of death. It provides that the persons eligible to substitute are, in order of preference, the claimant‘s spouse, his children, and his dependent parents.
Under the statutory scheme, eligibility to substitute has three requirements: the claimant must have died during the pendency of his claim, the prospective substitute must be alive at the time of the claimant‘s death, and the prospective substitute must be first in priority (for example, a spouse would have priority in substitution over a child). Because the status of a potential substitute is not static, eligibility to substitute can be conclusively determined only at the time of the claimant‘s death.
While it is possible that the individuals the claimant certifies as his spouse, children, or dependent parents at some point during his lifetime will still occupy that status at the time of the claimant‘s death, it is not certain that will be the case. Due to divorce, death, or a change in dependency status, the person who appears to be eligible to substitute based on the DVA‘s records may not in fact be eligible.
Both the statute and the regulation explicitly put the burden on the prospective substitute to prove eligibility to substitute, and in similar language. By its terms, the statute requires the prospective substitute to “present evidence of the right to claim such status.”
Even assuming the statute is not deemed to be entirely unambiguous in requiring a prospective substitute to provide evidence of eligibility, we must defer to the DVA‘s interpretation of the statutory provision if we find it to be reasonable. Chevron, U.S.A., Inc. v. Nat. Res. Defense Council, Inc., 467 U.S. 837, 842-43 (1984); Guerra v. Shinseki, 642 F.3d 1046, 1049 (Fed. Cir.2011). As the DVA pointed out in the comments that accompanied the issuance of the regulations, various events, such as divorce, remarriage, or the birth of a child could make the information in the veteran‘s file at time of his death inaccurate. See Final Rule, 79 Fed.Reg. at 52,980.
For example, suppose a veteran has a dependent mother and receives additional benefits on her account. See
NOVA argues that it is inappropriate for this court to accord Chevron deference to the DVA‘s interpretation of section 5121A because “interpretive doubt is to be resolved in the veteran‘s favor.” Brown v. Gardner, 513 U.S. 115, 118 (1994). However, this court has held that “where the meaning of a statutory provision is ambiguous, we must take care not to invalidate otherwise reasonable regulations simply because they do not provide for a pro-claimant outcome in every imaginable case.” Sears v. Principi, 349 F.3d 1326, 1331-32 (Fed. Cir.2003).
We have applied Chevron deference to the DVA‘s reasonable interpretation of the statutes that it administers in numerous other cases. See, e.g., Nat‘l Org. of Veterans’ Advocates v. Sec‘y of Veterans Affairs, 669 F.3d 1340, 1347-48 (Fed. Cir.2012) (“Because Congress has not spoken directly to the issue raised in the rule, we must determine whether the regulation is otherwise permissible.“); Guerra v. Shinseki, 642 F.3d at 1051-52 (“By regulation, the DVA has interpreted subsection 1114(s) to provide that in order to qualify for benefits under that statute, the veteran must have a single disability rated at 100%. That interpretation is entitled to deference under the principles of [Chevron].“); Haas v. Peake, 544 F.3d 1306, 1308 (Fed. Cir.2008) (“Thus, although Mr. Haas argues that the Brown [v. Gardner] doctrine effectively means that the DVA is not entitled to deference if its rulemaking resolves a statutory ambiguity, this court‘s precedent is to the contrary.“). There is no force to NOVA‘s suggestion that the DVA‘s interpretations are not entitled to Chevron deference because of Gardner.
III
NOVA also challenges the regulatory provisions that apply when the claimant dies while his case is pending before the Board of Veterans’ Appeals. The regulations provide as follows:
An appeal pending before the Board of Veterans’ Appeals when the appellant dies will be dismissed without prejudice. A person eligible for substitution under § 3.1010 of this chapter may file with the agency of original jurisdiction a request to substitute for the deceased appellant. If the agency of original jurisdiction grants the request to substitute, the case will assume its original place on the docket pursuant to Rule 900 (§ 20.900(a)(2)).
A case returned to the Board following the grant of a substitution request or pursuant to an appeal of a denial of a substitution request assumes the same place on the docket held by the deceased appellant at the time of his or her death. Pursuant to paragraph (c) of this section, if the deceased appellant‘s case was advanced on the docket prior to his or her death, the substitute will receive the benefit of the advanced placement.
Importantly, section 5121A provides that substitution under the new statute “shall be in accordance with such regulations as the Secretary [of Veterans Affairs] may prescribe.”
In the course of promulgating the regulation, the DVA addressed the argument that the Board should decide substitution issues that arise when a claimant dies while the case is pending before the Board. Noting that the Board‘s jurisdiction limits it to deciding appeals, the DVA explained in the remarks accompanying the proposed rules that the Board “cannot entertain requests to substitute in the first instance.” Proposed Rule, 76 Fed.Reg. at 8,668. Moreover, the DVA explained that “allowing the Board to decide a substitution request would deprive the survivor of the right to the ‘one review on appeal’ mandated by 38 U.S.C. § 7104(a).” Final Rule, 79 Fed.Reg. at 52,979. The Board‘s jurisdictional statute states:
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.
Finally, the Board is an appellate tribunal and is not well equipped to conduct the fact-gathering that may be necessary to determine eligibility for substitution. It was reasonable for the DVA to conclude that the agencies of original jurisdiction are better suited to perform that task.
No costs.
PETITION DENIED