Case: 21-1490 Document: 32 Page: 1 Filed: 01/20/2022
United States Court of Appeals
for the Federal Circuit
______________________
RANDOLPH S. GURLEY,
Claimant-Appellant
v.
DENIS MCDONOUGH, SECRETARY OF
VETERANS AFFAIRS,
Respondent-Appellee
______________________
2021-1490
______________________
Appeal from the United States Court of Appeals for
Veterans Claims in No. 19-1880, Judge Joseph L. Falvey,
Jr.
______________________
Decided: January 20, 2022
______________________
KENNETH M. CARPENTER, Law Offices of Carpenter
Chartered, Topeka, KS, argued for claimant-appellant.
JOSHUA E. KURLAND, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Washington, DC, argued for respondent-appellee. Also represented by BRIAN M. BOYNTON, CLAUDIA BURKE, MARTIN F.
HOCKEY, JR.; Y. KEN LEE, BRYAN THOMPSON, Office of General Counsel, United States Department of Veterans Affairs, Washington, DC.
______________________
Case: 21-1490 Document: 32 Page: 2 Filed: 01/20/2022
2 GURLEY v. MCDONOUGH
Before TARANTO, BRYSON, and STOLL, Circuit Judges.
TARANTO, Circuit Judge.
After beginning to receive veterans’ disability compensation benefits, Randolph S. Gurley was incarcerated for a
felony for a short period. Not knowing of the incarceration
until it ended, the Department of Veterans Affairs (VA)
paid Mr. Gurley’s full benefits during the period, even
though 38 U.S.C. § 5313 prescribes a substantial reduction
of payments to the veteran for certain incarceration periods. When VA learned of Mr. Gurley’s incarceration after
his release, it retroactively reduced the benefits for the
now-ended incarceration period, and to recoup the overpayment it had made, VA withheld payment of continuing benefits for a time, as authorized by
38 U.S.C. § 5314. Mr.
Gurley unsuccessfully appealed to the Board of Veterans’
Appeals and the Court of Appeals for Veterans Claims
(Veterans Court), contending that the statute does not permit a retroactive reduction for a period of incarceration
that has already ended. Mr. Gurley renews his argument
on appeal to us, but we agree with the Veterans Court that
38 U.S.C. § 5313 authorizes VA to make a post-incarceration decision to reduce benefits retroactively for the specified period of incarceration. We therefore affirm.
I
Mr. Gurley served in the United States Army between
1972 and 1974 (a period of war) and the Army National
Guard between 1975 and 1982. As of 1997, VA was paying
him service-connected-disability compensation benefits,
pursuant to 38 C.F.R. § 4.30, at the 100 percent disability
level based on individual unemployability. In 2011, Mr.
Gurley was convicted of a felony, and he was incarcerated
for nearly six months, from September 9, 2011 to March 1,
2012.
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GURLEY v. MCDONOUGH 3
By statute, when a veteran is incarcerated for a felony
conviction, the veteran “shall not be paid” the full amount
of awarded compensation benefits “for the period beginning
on the sixty-first day of such incarceration and ending on
the day such incarceration ends.” 38 U.S.C. § 5313(a)(1).
In Mr. Gurley’s situation, the payment had to be reduced
from the 100% disability level to the 10% disability level,
under
38 U.S.C. § 5313(a)(1)(A) and § 1114(a). Mr. Gurley,
however, received his full benefits during the entirety of his
incarceration, because VA did not learn of his incarceration
until six days after his release, when VA compared its records with those of the Social Security Administration. After confirming Mr. Gurley’s incarceration with the prison
he had just left, VA notified Mr. Gurley that he had been
overpaid benefits beginning on the 61st day of his incarceration (i.e., November 8, 2011) and that VA would retroactively reduce his benefits for the period beginning on the
61st day and ending on his release (i.e., March 1, 2012).
Mr. Gurley objected on the ground that he was no
longer incarcerated. But VA proceeded to make the retroactive reduction of benefits for the specified period, informing Mr. Gurley that he had received an overpayment and
would soon be given information about the exact amount
and about repayment. Two weeks later, VA notified Mr.
Gurley that the overpayment was $10,461 (a calculation
not in dispute here) and that VA would reduce its payment
of Mr. Gurley’s current benefits “until the amount . . . overpaid is recouped.” J.A. 108.
Mr. Gurley requested a waiver under 38 U.S.C. § 5302
(authorizing waivers of recovery of overpayments) and disputed the debt. 1 VA denied the requested waiver and
1 Besides providing an opportunity for waiver, the
statute allows VA, under specified circumstances, to pay
(“apportion”) amounts withdrawn from the veteran to family members. 38 U.S.C. §§ 5313(b), 5307. We have before
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4 GURLEY v. MCDONOUGH
issued a Statement of the Case reiterating its debt determination. J.A. 68–69, J.A. 92–94. Mr. Gurley appealed
only the debt determination, not the waiver denial. The
Board rejected Mr. Gurley’s challenge to VA’s creation of
the debt by the retroactive reduction of benefits for all but
the first 60 days of the incarceration period. J.A. 18–26.
The Board determined that VA properly established that
an overpayment occurred and that a debt existed because
it was undisputed that Mr. Gurley received his full benefits
during his incarceration, to which he was not entitled under
38 U.S.C. § 5313. J.A. 19, 22–23.
Mr. Gurley appealed to the Veterans Court, which affirmed the Board’s decision. Gurley v. Wilkie, 2020 WL
6065829 (Vet. App. Oct. 15, 2020). It concluded that the
retroactive benefit reduction was proper under
38 U.S.C.
§ 5313 and recoupment of the overpayment through withholding of continuing benefit payments was proper under
at least
38 U.S.C. § 5314. Gurley,
2020 WL 6065829, at *2–
5. Mr. Gurley timely appealed to this court.
II
Under 38 U.S.C. § 7292(a), this court has jurisdiction
to address the Veterans Court’s interpretation of a statute.
Mr. Gurley presents one properly preserved argument—
that the Veterans Court misconstrued
38 U.S.C. § 5313 to
allow VA to declare an overpayment debt for the period of
incarceration even after the veteran is no longer incarcerated. Mr. Gurley contends that § 5313 permits VA to act
only during the period of incarceration. We review the Veterans Court’s statutory interpretation de novo. Cameron
v. McDonough,
1 F.4th 992, 995 (Fed. Cir. 2021). We agree
with the Veterans Court, and disagree with Mr. Gurley, on
us no application of that provision, which is invokable by
family members to obtain money no longer due the veteran.
See Batcher v. Wilkie,
975 F.3d 1333, 1338 (Fed. Cir. 2020).
Case: 21-1490 Document: 32 Page: 5 Filed: 01/20/2022
GURLEY v. MCDONOUGH 5
the proper answer to the question of statutory interpretation before us.
Section 5313 provides, in relevant part:
(a)(1) To the extent provided in subsection (d) of
this section, any person who is entitled to compensation or to dependency and indemnity compensation and who is incarcerated in a Federal, State,
local, or other penal institution or correctional facility for a period in excess of sixty days for conviction of a felony shall not be paid such compensation
or dependency and indemnity compensation, for
the period beginning on the sixty-first day of such
incarceration and ending on the day such incarceration ends, in an amount that exceeds–
(A) in the case of a veteran with a service-connected
disability rated at 20 percent or more, the rate of
compensation payable under section 1114(a) . . . .
38 U.S.C. § 5313(a)(1).
This statute has a straightforward meaning in the respect at issue. It creates a rule that a veteran convicted of
a felony “shall not be paid compensation [including disability compensation]. . . in an amount that exceeds” specified
rates “for the period beginning” on the 61st day of incarceration “and ending on the day” the incarceration ends. Id.
(emphasis added). The only temporal aspect of the provision is one that addresses the period “for” which the veteran is to receive benefits. The provision does not use
language that addresses the time at which VA must make
its reduction decision regarding those benefits. It addresses payments “for” the incarceration period, providing
for specified reductions.
The remainder of § 5313 does not support reading into
§ 5313(a)(1) a requirement that VA act before incarceration
ends or lose the ability to limit the payments to which the
veteran is entitled during incarceration. See, e.g., id.
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6 GURLEY v. MCDONOUGH
§ 5313(a)(2) (excluding periods during which the convicted
felon “is participating in a work-release program or is residing in a halfway house”); § 5313(b) (addressing apportionment); § 5313(c) (barring assignment of total disability
based on individual unemployability during incarceration);
§ 5313(d) (applying (a) to certain events based on initial October 1980 enactment of provision); § 5313(e) (including
compensation under 38 U.S.C. § 1151). Moreover, Mr.
Gurley points to no other statutory provision that bars retroactive benefit reductions generally or in his situation. In
fact,
38 U.S.C. § 5112(a) contemplates retroactive reductions when it states a general rule that “the effective date
of reduction . . . shall be fixed in accordance with the facts
found,” subject to specified exceptions,
id. § 5112(b), not invoked here. And § 5314 specifically contemplates VA’s recovery of overpayments through withholding from future
benefits, while § 5302 contemplates case-specific waivers
(again, not at issue here) to allow moderation of the effects
of such recovery where warranted.
There is an evident reason to give § 5313(a) its
straightforward meaning, which allows retroactive reduction. VA might not have the contemporaneous knowledge
of a particular veteran’s incarceration needed to take the
initiative of reducing benefits by the 61st day. Congress
adopted the provision in 1980—originally as 38 U.S.C.
§ 3113—as part of the Veterans’ Disability Compensation
and Housing Benefits Amendments of 1980, Pub. L. No. 96-
385, § 504, 94 Stat. 1528, 1534. Nothing in the statute, and
nothing we are aware of in the legislative history, suggests
that Congress expected VA to have the contemporaneous
knowledge of a veteran’s incarceration required to broadly
ensure prospective reduction by the 61st day.
More affirmatively, we have recognized the policy inherent in § 5313: “Congress did not see the wisdom in
providing substantial benefits to disabled veterans when at
the same time the taxpayers of this country are spending
additional thousands of dollars to maintain these same
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GURLEY v. MCDONOUGH 7
individuals in penal institutions.” Mulder v. McDonald,
805 F.3d 1342, 1348 (Fed. Cir. 2015) (cleaned up). That
policy applies regardless of whether the reduction for the
incarceration period is implemented by VA during incarceration or after incarceration. And, although a veteran’s
family members may depend on the veteran’s compensation benefits, Congress expressly provided, in § 5313(b), a
mechanism for family members to seek to have apportioned
to them amounts withdrawn from the veteran under
§ 5313(a). That provision, which is not in play here, reinforces the simple policy of § 5313(a) itself, which supports
the Veterans Court’s straightforward interpretation.
For those reasons, we agree with the Veterans Court
that § 5313 does not require VA to act during the incarceration period to implement the mandated benefits reduction
for the specified part of that period.
III
Mr. Gurley additionally argues that VA did not comply
with certain procedural requirements of § 5314 and of 38
C.F.R. § 1.911(c)–(d), the latter implementing general statutory authority for government debt collection, see
31
U.S.C. §§ 3701, 3711. Appellant’s Opening Br. at 14–18.
But Mr. Gurley did not raise these arguments in the Veterans Court. See Gurley,
2020 WL 6065829, at *5 (“Mr.
Gurley does not argue that VA ignored any of these requirements.”). They are thus forfeited. Personal Audio,
LLC v. CBS Corp.,
946 F.3d 1348, 1354 (Fed. Cir. 2020).
IV
Because we agree with the Veterans Court that 38
U.S.C. § 5313 does not require VA to act during the period
of incarceration, we affirm.
The parties shall bear their own costs.
AFFIRMED
