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Veteran benefits tangle leaves Supreme Court justices on a tightrope

A 45-year-old fight for disability benefits landed on the Supreme Court steps Tuesday as a veteran asked the justices to enforce a safety-valve provision to save what he says was a wrongly denied claim. 

When he was 17, Kevin George enlisted in the U.S. Marine Corps with no knowledge of any family history of mental health disorders. One week into his service, however, George suffered a mental health episode requiring hospitalization. George was later diagnosed with paranoid schizophrenia that was aggravated by his service. It was recommended that George secure a military discharge. 

The Department of Veterans Affairs provides disability benefits for U.S. military veterans who are disabled because of injuries suffered in the line of duty or preexisting injuries that are aggravated by duty. 

George attempted to attain disability benefits for his condition following his discharge from the Marine Corps, but his claim was stymied when the physical evaluation board disagreed with the conclusion of the medical board that service had aggravated his schizophrenia. George’s claim for benefits related to service-connected aggravation of his schizophrenia was subsequently denied. 

Almost 40 years later, George challenged the board’s decision to deny his claim using a statutory provision that says a decision by the board is subject to revision on the grounds of a “clear and unmistakable error.” This specific provision allows veterans to challenge VA decisions years after their claims are denied by suspending the usual consequences of finality. George’s appeal claims the board’s decision did not correctly apply a statute that requires the government to provide clear and unmistakable evidence that an injury existed before he enlisted. Complicating the matter, that provision did not exist in 1977 when the board denied George’s benefits claim. 

The regulation that the board was operating under in 1977 did not require clear and unmistakable evidence to deny a claim. That regulation has since been rejected as inconsistent with the text enacted by Congress. 

George asked the board to revise its earlier decision on the grounds that it made a clear and unmistakable error when applying a regulation that was contrary to the statute. The board denied that request, however, saying that judicial decisions that make new interpretations of the law following a VA decision cannot be the basis of a valid claim. The Court of Appeals for Veterans Claims and the Federal Circuit then affirmed the denial of George’s claim. 

The case before the justices asks if an agency regulation that is later found to be invalid, according to the text of a statute, qualifies as a clear and unmistakable error for a veteran to challenge the VA’s decision. 

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George claims that the agency regulations can only be considered law if they comply with the language set out by Congress. Because the agency regulation used to deny his claim was later found to be invalid, George argues he should be able to challenge the board’s original denial. 

“There is no dispute that a clear and unmistakable error has occurred when VA adjudicators misapply the terms of a plain statute,” said Melanie Bostwick, an attorney with Orrick, Herrington & Sutcliffe representing George. “The government seeks to impose an atextual exception to that general rule: that the agency does not clearly err when it enshrines its misapplication of law in a regulation. That cannot be correct. As this court has said over and over, an agency regulation has the force of law only if it is consistent with Congress’ command.” 

The government argues that clear and unmistakable errors are a very specific type of error and this does not qualify as one. 

“Clear and unmistakable error serves the function of allowing for correction on collateral review with no time limits,” Assistant to the Solicitor General Anthony Yang said. “It’s a very specific type of error based on the legal context that existed at the time of the original decision, an error that no one from that framework could reasonably dispute. The board’s application of a regulation that Congress itself had required the board to apply does not qualify.” 

The justices gave no clear indication of how they may rule in the case. Justice Samuel Alito said George was trying to make the case “a lot simpler than it actually is.” On the other side of the argument, Justice Neil Gorsuch used the word “remarkable” to describe the government’s claim that error was not clear and unmistakable.

Gorsuch cited an amicus brief filed by Republican Senators Ted Cruz and Mike Lee that focuses on the separation-of-powers issues this case presents. The brief claims that, if an agency puts out a regulation that it does not have the authority to make, then the regulation is void. 

“The real distinction is that the government is still almost acting as though the 1974 regulation was relevant to the way in which courts and the Veterans Administration and everybody else has to consider this claim and look at the law,” Jennifer Mascott, co-executive director of the Gray Center at Antonin Scalia Law School, said in a phone call. 

Mascott, who is also an assistant professor of law, continued: “So the separation-of-powers implication of that would be that it’s almost as though the agency is getting an extra bit of deference and credit and the ability to be able to operate outside of its lawful authority simply because it made a show of putting out a regulation in 1974 that, as it turns out, was just completely flawed and beyond its bounds of authority.” 

Some of the justices appeared concerned about the possible implication that a ruling in the case could cause an onslaught of claims to come before the VA. Justice Brett Kavanaugh cited the claim from the veterans court that a ruling in the case could impose a substantial strain on an already strained system. 

The Military-Veterans Advocacy and Lead Aid Foundation warned the justices that the lower court ruling places extra burdens on disabled veterans who already contend with a complicated system. 

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“Congress enacted CUE [clear and unmistakable error] to serve as a safety valve that suspends the usual consequences of finality and ensures that veterans subjected to these sorts of errors are ultimately able to obtain the benefits to which their service has entitled them,” Michael Joffre, an attorney with William Milliken, wrote in the group’s amicus brief. “If the decision below is permitted to stand, that safety valve is gone.”

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