UNITED STATES COURT OF VETERANS APPEALS

No. 94-0186

Eddie W. Verdon, Appellant,

v\.

Jesse Brown,

Secretary of Veterans Affairs, Appellee.

On Appeal from the Board of Veterans\' Appeals

(Decided February 7, 1996 )

Jeffrey Wood was on the brief for the appellant.

Mary Lou Keener, General Counsel; Norman G. Cooper, Assistant General
Counsel; David W. Engel, Deputy Assistant General Counsel; and Adam K.
Llewellyn were on the brief for the appellee.

Sean Kendall was on the brief for the National Organization of Veterans
Advocates as amicus curiae.

Before NEBEKER, Chief Judge, and HOLDAWAY and STEINBERG, Judges.

STEINBERG, Judge, filed the opinion of the Court. HOLDAWAY, Judge, filed
an opinion concurring in part and dissenting in part.

STEINBERG, Judge: The appellant, Eddie Verdon, appeals a February 7,
1994, Board of Veterans\' Appeals (BVA or Board) decision denying
entitlement to service connection for residuals of a bunionectomy of the
right foot. Record (R.) at 10. Both parties filed briefs and
supplementary memoranda, and the amicus curiae filed a brief in response
to an April 4, 1995, order of the Court. For the reasons that follow,
the Court will vacate the BVA decision and remand two matters.

I. Background

The veteran served on active duty in the U.S. Navy from November 1985 to
March 1988. R. at 18. An August 1985 induction medical examination
report noted bilateral valgus and an orthopedic examination was
requested for \"\[b\]unions on big toes\". R. at 61-63. An August 1985
Navy orthopedic consultation report diagnosed bunions and \"Hallux
Valgus\" and noted \"no problem \[with\] feet\". R. at 63. (\"Hallux
valgus\" is angulation of the great toe away from the midline of the
body (toward the other toes) and can be caused by bunions, Dorland\'s
Illustrated Medical Dictionary 244, 729 (27th ed. 1988) \[hereinafter
Dorland\'s\].) Service medical records (SMRs) recorded that the veteran
had suffered an injury to the right knee on October 19, 1986, and had
been placed on limited duty. R. at 20-22. A January 1987 SMR indicated
that the veteran had \"\[b\]listers\" and \"\[b\]unions \[on\] both big
toes\" and stated: \"For years had problems \[with\] them\". R. at 64.
He underwent arthroscopy at a Navy hospital in April 1987 for a
right-knee injury. R. at 25-26. In October 1987, he had a bunionectomy
\"for hallux valgus\" of the right great toe. R. at 66-68. He was
discharged in February 1988 as \"unfit because of physical disability\".
R. at 44. His right-knee condition was listed as the condition that
caused his unfitness, and \"s\[tatus\] p\[ost\] bunionectomy\" was
listed as a condition that was \"not separately unfitting and \[did\]
not contribute to the unfitting conditions\". Ibid.

The veteran filed with a Veterans\' Administration (now Department of
Veterans Affairs) (VA) regional office (RO) an April 21, 1988,
application for VA compensation or pension for his right-knee condition,
a cut to his right ear, and a bunionectomy. R. at 50-51. In June 1988, a
VA medical examination report listed an impression of \"\[r\]esidual
bunion surgery, right foot\", and noted \"\[n\]o specific orthopedic
surgical treatment indicated at this time.\" R. at 86. A July 1988 VA
orthopedic examination report listed diagnoses of the following: (1)
\"Insufficiency, r\[ight\] ant\[erior\] cruciate ligament, s\[tatus\]
p\[ost\] repair\"; (2) \"\[b\]union deformity r\[ight\] foot, s\[tatus\]
p\[ost\] repair\"; and (3) \"\[l\]aceration, r\[ight\] ear lobe,
s\[tatus\] p\[ost\] repair\". R. at 59. A December 15, 1988, VARO
decision awarded service connection for a right-knee injury, rated 20%
disabling, and a left-ear scar, rated 0% disabling. R. at 81. The RO
decision denied service connection for a right-foot bunionectomy because
\"\[b\]unions existed prior to service and the bunionectomy in 1987 is
considered to have been remedial surgery, to correct the pre-existing
defect.\" R. at 80-81.

In January 1989, a VA medical examination report noted that the
veteran\'s fourth and fifth toes on the right foot were \"discolored and
swollen\" and that he had stated that he had injured his right foot two
days previously. R. at 91-92. A contemporaneous x-ray report noted
\"\[o\]ld healed march fractures of the shafts of the right 2nd and 3rd
m\[eta\]t\[arsals\].\" R. at 93. (A \"march fracture\" is a fracture of
a bone of the lower extremity, developing after repeated stresses, as
seen in soldiers, Dorland\'s at 661.)

In September 1989, the veteran filed with the RO an application for
increased ratings for his service-connected right-knee and right-ear
conditions and for service connection for his right-foot condition. R.
at 83 (see R. at 104). In November and December 1989, the RO confirmed
its December 1988 decision, stated that a December 1988 letter it had
sent the veteran had not fully informed him as to the December 1988
decision, and advised him that he could reopen his claim for service
connection with new evidence. R. at 95-96. A December 1989 VA outpatient
report noted that the veteran had injured his left leg in a \"martial
arts contest\". R. at 120. The veteran filed a December 26, 1989, Notice
of Disagreement (NOD) and a February 1990 VA Form 1-9 (Substantive
Appeal to the BVA) \[hereinafter 1-9 Appeal\]. R. at 99, 109; see R. at
104.

A July 30, 1990, VA orthopedic outpatient clinic report listed an
impression of \"\[l\]igament instability, right knee\", and recommended
referral to the state department of rehabilitation because \"it appears
that he will not be able to continue at his present work . . . which
requires walking.\" R. at 122. In September 1990, a VA medical
examination report noted limited flexion of the right knee and a tender
scar on the right ear, but did not mention any right-foot problem. R. at
115-16. A February 1991 RO decision concluded: \"No change is
warranted.\" R. at 119. In January 1992, the BVA remanded the claim to
the RO to determine if the veteran wished to have a hearing. R. at 135.

At a January 6, 1993, RO hearing, the veteran testified under oath that
he was currently working and that he did not \"lose any time\" from work
due to his knee condition, but that it did \"interfere\[\]\" with his
\"work performance\". R. at 152, 161-62. As to his right foot, he
testified that he had had asymptomatic bunions when he entered service,
and that they had been aggravated by the hard plastic shoes he had worn
in service. R. at 163-64, 171. He also testified, on the one hand, that
he currently had pain \"\[r\]ight on the side of the foot\" with limited
movement in the right great toe and numbness and tingling on the top of
his foot, as well as pain due to the remaining bunion on his left foot.
R. at 168-70. On the other hand, when asked if the bunionectomy had
improved his right-foot condition, he testified: \"It turned out to be,
okay, it doesn\'t hurt on the side of the foot where the bunion was\".
R. at 170.

In a February 1993 decision, the hearing officer, inter alia, affirmed
the RO\'s previous denial of service connection for the right-foot
condition. The hearing officer\'s decision noted that pre-1989 SMRs and
VA medical records were negative for limitation of motion and numbness
of the right great toe; that the veteran had injured his right foot in
January 1989; and that an x-ray at that time had revealed old march
fractures of the second and third metatarsals. R. at 177. A March 1993
RO decision rated the right-ear scar as 10% disabling, continued the 20%
rating for the right-knee disability, and continued the denial of
service connection for residuals of a right-foot bunionectomy. R. at
186-87.

In a May 1993 letter to service representative Charles Moran of the
Veterans of Foreign Wars (VFW), the veteran stated: \"I have come to an
agreement with the terms on the 10% for the ear\[,\] and for my leg I
agree at 20% at this time\"; he voiced a wish to appeal the denial of
service connection for residuals of the right-foot bunionectomy. R. at
191. (VA received a copy of this letter in some manner. See R. at 6.)
Mr. Moran\'s June 1993 written presentation to the BVA listed the
\"issue\" as \"service connection for residuals of bunionectomy\". R. at
194. On the other hand, a July 1993 written presentation to the Board by
VFW service representative Jesse Boone argued for an increased rating
for the right knee as well as service connection for residuals of the
bunionectomy. R. at 196-97. Furthermore, the representative stated:
\"This case was initially reviewed by this service in an informal
hearing presentation dated November 12, 1991, now reoffered.\" R. at 196
(emphasis added). That November 12, 1991, VFW written presentation had
listed \"Entitlement to an increased evaluation for service-connected
right knee condition\" as one of three questions at issue, and then
stated:

The veteran\'s first contention is that his service-connected right knee
condition is of such severity as to warrant an increased evaluation. VA
examination of June 1, 1988, notes right knee has full extension.
Flexion was noted to be lacking 15 degrees. Final impression was
ligament instability with traumatic arthritis. In this regard, we would
ask the Board to consider the provisions of 38 C.F.R. § 4.7 in their
deliberations, and grant the next higher evaluation under Diagnostic
Code 5257.

R. at 130-31.

The February 1994 BVA decision here on appeal denied service connection
for residuals of a right-foot bunionectomy, finding that the veteran had
experienced problems, including pain, with bunions before service; that
the bunion surgery in service was remedial; and that his right foot had
improved by the time he left service. R. at 8, 10. The Board cited 38
U.S.C. § 1131 and 38 C.F.R. § 3.306(a) as to aggravation of preexisting
injuries, and 38 C.F.R. § 3.306(b)(1) as to ameliorative surgical or
medical treatment in service. R. at 9. The Board concluded:

As it stands, evidence of an increase in underlying pathology in service
is absent. On the contrary, the record indicates that the remedial
measure undertaken, surgical correction of the bunion deformity, was
successful. At his recent hearing, the veteran reported that he did not
experience pain on the side of the right foot where the bunion had been.

R. at 10. The BVA found that \"in a statement received from the veteran
in May 1993, he made clear his intent to pursue on appeal only the issue
of entitlement to service connection for residuals of a right foot
bunionectomy.\" R. at 6. The Board thus did not address the issue of an
increased rating for the right knee. A timely appeal to this Court
followed.

II\. Analysis

A. Increased Rating for Right-Knee Disability

A claim for an increased rating is a new claim, not subject to the
provisions of 38 U.S.C. § 7104(b) prohibiting reopening of previously
disallowed claims except upon new and material evidence. See Proscelle
v. Derwinski, 2 Vet.App. 629, 631-32 (1992); see also Suttmann v. Brown,
5 Vet.App. 127, 136 (1993). A claim for an increased rating is generally
well grounded when an appellant indicates that he has suffered an
increase in disability. Ibid. The veteran argues, through counsel, that
the BVA erred in determining that he had abandoned his claim for an
increased rating for his service-connected right-knee disability. Brief
(Br.) at 4. He asserts that his May 1993 letter to his service
representative, stating \"for my leg I agree at 20% at this time\", was
ambiguous, and that his service representative had argued both issues in
a July 1993 written presentation to the Board. Br. at 3.

There is no statute or regulation that expressly applies to withdrawal
of a separate claim within an appeal. However, 38 C.F.R. § 20.204(c)
provides as to withdrawal of an NOD or a 1-9 Appeal:

Withdrawal may be by the appellant or by his or her authorized
representative, except that a representative may not withdraw either
\[an NOD\] or \[1-9 Appeal\] filed by the appellant personally without
the express written consent of the appellant.

38 C.F.R. § 20.204(c); see Hamilton v. Brown, 4 Vet.App. 528, 538 (1993)
(en banc), aff\'d, 39 F.3d 1574 (1994). The issue of withdrawal of a
separate claim (covered by a multiple-claim single NOD) is analogous to
withdrawal of an NOD or a 1-9 Appeal, and the Court will therefore apply
§ 20.204(c) by analogy to the situation in the instant case.

The veteran\'s May 1993 letter was addressed to his VFW service
representative and not to the RO or BVA. R. at 191. It was similar to an
attorney-client communication. The veteran himself apparently did not
notify VA or the BVA that he was withdrawing that claim. (The record
does not reveal how a copy of the May 1993 letter got to the Board.) In
his June 1993 written presentation to the BVA, Mr. Moran discussed only
the issue of service connection for bunionectomy residuals but did not
expressly withdraw the issue of an increased rating for the right knee.
R. at 194. In his July 1993 written presentation to the BVA, Mr. Boone,
the other VFW representative, expressly stated that the questions both
of service connection for bunionectomy residuals and of an increased
rating for the right-knee disability were at issue, and incorporated by
reference and reoffered the November 1991 statement expressly arguing
both issues. R. at 196-97; see also R. at 130-31. Thus, of the two
post-May-1993 statements submitted to VA by the veteran\'s
representative, the VFW, one did not mention the issue of an increased
rating for the right knee, and the other expressly included that issue.
Neither the veteran nor his representative expressly notified VA in
writing that the right-knee claim was abandoned, although the veteran\'s
May 1993 letter to his representative certainly suggested that
intention.

In considering the question of abandonment of that claim, we must take
into consideration \"the nonadversarial setting of the \[VA\] claims
adjudication process\", Isenbart v. Brown, 7 Vet.App. 537, 541 (1995),
in which VA is required to construe liberally all submissions by a
claimant, see EF v. Derwinski, 1 Vet.App. 324, 326 (1991); 38 C.F.R. §
20.202 (1994) (arguments in VA Form 1-9 (Substantive Appeal to Board)
will be construed \"in a liberal manner for purposes of determining
whether they raise issues on appeal\"). Against this background, we
conclude that the facts of this case \-- the pro se veteran\'s ambiguous
May 1993 letter and his representative\'s subsequent July 1993 written
presentation incorporating and reoffering the November 1991 written
presentation \-- created a reasonable doubt as to whether the veteran
had withdrawn the right-knee claim from his appeal to the BVA.

Under such circumstances, where it is not clear that a VA claimant has
withdrawn a particular claim from an appeal to the BVA, it is not
sufficient for the Board to conclude that there is an abandonment
without providing an adequate statement of reasons or bases to support
that conclusion, taking into account all of the facts relating to the
status of the claim as well as the Secretary\'s obligations under EF,
supra. See 38 U.S.C. § 7104(d)(1) (each BVA decision shall include
written statement of Board\'s finding and conclusions, and reasons or
bases for same, on all material issues of fact and law presented on
record); cf. Servello v. Derwinski, 3 Vet.App. 196, 200-01 (1992)
(remanding claim to BVA where Board had failed to evaluate relevant
evidence); Godwin v. Derwinski, 1 Vet.App. 419, 425 (1991) (quoting
Murphy v. Derwinski, 1 Vet.App. 78, 81 (1990) for proposition that BVA
conclusion that it had no duty to assist \"must be supported by a
\`written statement of . . . the reasons or bases for those findings and
conclusions\'\"); Myers v. Derwinski, 1 Vet.App. 127, 130 (1991);
Gilbert v. Derwinski, 1 Vet.App. 49, 56-57 (1990). In the instant case,
the Court will not proceed to decide the abandonment question without
the enlightenment which the Board\'s statement of reasons or bases is
designed to provide both to the Court and the claimant. See ibid; see
also Landicho v. Brown, 7 Vet.App. 42, 48 (1994) (this Court is not
generally initial trier of fact); Webster v. Derwinski, 1 Vet.App. 155,
159 (1991). Accordingly, the Court will vacate the BVA decision as to
the right-knee claim and remand that matter for the Board to provide an
adequate statement of reasons or bases on the abandonment question and,
if the Board finds, in view of all the facts pertaining to that claim,
including the veteran\'s representative\'s July 1993 written
presentation and its incorporation of the November 1991 presentation,
that the claim has not been abandoned, for the Board to adjudicate the
right-knee claim in accordance with applicable law and regulation.

B. Service Connection for Residuals of Bunionectomy

1\. Original claim versus claim to reopen. Service connection for VA
disability compensation purposes will be awarded to a veteran who served
on active duty during a period of war, or during a post-1946 peacetime
period, for any disease or injury that was incurred in or aggravated by
a veteran\'s active service or for certain diseases that were initially
manifested, generally to a degree of 10% or more, within a specified
presumption period after separation from service. See 38 U.S.C. §§ 1110,
1112, 1113(a), 1116, 1131, 1133(a), 1137; 38 C.F.R. §§ 3.303(a), 3.306,
3.307 (1994). A service-connection claim must be accompanied by evidence
which establishes that the claimant currently has the claimed
disability. See Brammer v. Derwinski, 3 Vet.App. 223, 225 (1992) (absent
\"proof of a present disability\[,\] there can be no valid claim\");
Rabideau v. Derwinski, 2 Vet.App. 141, 144 (1992).

The veteran applied for service connection for residuals of a right-foot
bunionectomy in April 1988. His claim was denied by an RO decision dated
December 15, 1988 (R. at 80-81, that denial was confirmed in November
1989, R. at 95-96), and his NOD was signed December 19, 1989, and filed
with the RO on December 26, 1989 (R. at 99); in February 1991, the RO
confirmed the denial again (R. at 119). An NOD is timely filed only when
it is postmarked or filed within one year after the date of mailing of
notice of the RO decision. See 38 U.S.C. § 7105(b)(1).

The RO, in December 1989, informed the veteran that its December 1988
decision remained unchanged and that he would need \"new evidence\" in
order to have his claim reevaluated. R. at 95. Because the RO did not
properly advise the veteran of the December 1988 decision, see R. at
104, 107, that decision did not become final until the RO mailed the
veteran notice of it or of the November 1989 decision. The December 19,
1989, NOD was thus timely filed, and, hence, the BVA did not err in
treating this claim for service connection for bunionectomy residuals as
an original claim and not a claim to reopen. See 38 U.S.C. §§ 5107(a),
5108; Suttmann, 5 Vet.App. at 135-36 (discussing difference between
original claim and claim to reopen).

2\. Presumption of sound condition. The veteran\'s claim was subject to
38 U.S.C. § 1111, which provides:

\[E\]very veteran \[of wartime service\] shall be taken to have been in
sound condition when examined, accepted, and enrolled for service,
except as to defects, infirmities, or disorders noted at the time of the
examination, acceptance, and enrollment, or where clear and unmistakable
evidence demonstrates that the injury or disease existed before
acceptance and enrollment and was not aggravated by such service.

See also 38 U.S.C. § 1137 (extending wartime service presumption of
section 1111 to post-1946 peacetime service); 38 C.F.R. § 3.304(b)
(1994). The Board determined that the presumption of sound condition did
not attach as to the veteran\'s claim for service connection for
residuals of a right-foot bunionectomy because bunions had been noted on
his entrance examination and he \"had reported at entrance that he
experienced pain associated with the bunion deformity\". R. at 9.

Notwithstanding the Board\'s statement that the veteran had reported
\"pain\" at his entrance examination, the record does not contain any
notation that he was having or had reported pain due to bunions at the
time he entered service. Indeed, the August 1985 Navy orthopedic
examination report noted shortly before his induction: \"No problem
\[with\] feet . . . . No special shoes or orthotics.\" R. at 63. The
Secretary argues that the BVA was referring to statements of patient
history accompanying January 1987 SMRs. Br. at 7 (citing R. at 64-65).
However, these records are only partially legible and their meaning is
not clear.

Nevertheless, even though the veteran\'s bunions may have been
asymptomatic at the time of his induction, they were \"noted\" on the
Navy induction medical examination report and the accompanying
orthopedic examination report. R. at 61-63; see 38 C.F.R. § 3.304(b);
Crowe v. Brown, 7 Vet.App. 238, 245 (1994); Parker v. Derwinski, 1
Vet.App. 522, 524 (1991). \"The presumption \[of sound condition\] . . .
attaches \[only\] where there has been an induction examination in which
the later complained-of disability was not detected.\" Bagby v.
Derwinski, 1 Vet.App. 225, 227 (1991) (emphasis added). The Board
therefore was not in error in determining that the bunion disorder was a
preexisting condition.

3\. Presumption of aggravation. If a disease or injury preexisted
service, the following presumption of aggravation may apply:

A preexisting injury or disease will be considered to have been
aggravated by active military, naval, or air service, where there is an
increase in disability during such service, unless there is a specific
finding that the increase in disability is due to the natural progress
of the disease.

38 U.S.C. § 1153; see also 38 C.F.R. § 3.306. The determination whether
a disability found to be preexisting was aggravated by service is a
question of fact. See Doran v. Brown, 6 Vet.App. 283, 286 (1994) (citing
Green v. Derwinski, 1 Vet.App. 320, 322 (1991)). Factual determinations
are reviewed under the \"clearly erroneous\" standard: \"if there is a
\`plausible\' basis in the record for the factual determinations of the
BVA, . . . \[the Court\] cannot overturn them\". Gilbert, 1 Vet.App. at
53; 38 U.S.C. § 7261(a)(4).

The Board found that the presumption of aggravation did not attach
because the right-foot condition did not worsen in service beyond the
natural progress of the disease. R. at 10. As to the veteran\'s
assertion that the bunionectomy had left him with right-foot numbness
and limitation of motion in his right great toe, the BVA stated:
\"\[W\]e point out not only that the record fails to establish such
residuals, but also that the effects of surgical treatment in service .
. . will not be service-connected in the absence of other evidence
demonstrating an increase in the disability.\" Ibid. (citing 38 C.F.R. §
3.306(b)(1)). The Board thus rested its decision on alternative grounds:
(1) That the medical evidence did not show limitation of motion of the
right great toe or numbness of the right foot, and (2) that, even if
these symptoms had been present and had been a result of the in-service
bunionectomy, such residuals could not be service connected because,
pursuant to 38 C.F.R. § 3.306(b)(1), they were the result of
ameliorative surgery and there was no increase in the \"underlying
pathology\" during service. R. at 10. The Court will examine these
alternative grounds separately.

a\. Medical evidence as to right-foot claim. Although the veteran does
have a diagnosis of a right-foot condition (see R. at 59, 86, 93), the
BVA was correct that the record does not reveal a recent medical
diagnosis of limitation of motion of the right great toe or numbness of
the right foot. The last medical evaluation references to the veteran\'s
right-foot bunion residuals were in June and July 1988, within ten
months after his bunionectomy and almost six years before the BVA
decision. The January 1989 VA medical examination and x-ray reports
referred to an injury to the veteran\'s fourth and fifth toes and
discoloration and swelling of those toes, but did not mention any
bunionectomy residuals. R. at 91-92. The September 1990 VA examination
did not mention the veteran\'s right foot. See R. at 115-16. The Court
will thus vacate the BVA decision as to the right-foot claim and remand
the matter for a comprehensive medical examination of the veteran\'s
right foot, with all medical records reviewed by the examiner. See
Suttmann, 5 Vet.App. at 138; Green (Victor) v. Derwinski, 1 Vet.App.
121, 124 (1991). The examiner should express an opinion as to the origin
of the \"healed march fractures\" noted in January 1989, and as to the
degree of worsening, if any, of the veteran\'s preexisting right-foot
condition by the time of his discharge from service. See Wilson
(Lawrence) v. Derwinski, 2 Vet.App. 16, 21 (1991); Hunt v. Derwinski, 1
Vet.App. 292, 296 (1991); Green, supra; see also 38 C.F.R. §§ 4.1 (in
the examination and evaluation of disability, each disability must be
viewed in relation to its history); 4.2 (if a medical examination report
does not contain sufficient detail, RO must return the report as
inadequate for evaluation purposes) (1994).

b\. Increase in underlying pathology. VA regulations provide:

The usual effects of medical and surgical treatment in service, having
the effect of ameliorating disease or other conditions incurred before
enlistment, including postoperative scars, absent or poorly functioning
parts or organs, will not be considered service connected unless the
disease or injury is otherwise aggravated by service.

38 C.F.R. § 3.306(b)(1). The BVA relied upon this regulation, in the
alternative, to deny service connection for right-foot-bunionectomy
residuals because \"evidence of an increase in underlying pathology in
service is absent\" and \"the remedial measure undertaken, surgical
correction of the bunion deformity, was successful.\" R. at 10.

The appellant argues that the history of amendments to § 3.306(b)(1)
indicates that service connection is available for current residuals of
medical or surgical treatment performed during service for a condition
that predated service, because the existence of \"residuals\"
necessarily means that there has been an increase in disability.
Supplemental Memorandum (Suppl. Mem.) at 6 (quoting Regulation 1063(I),
the predecessor to § 3.306(b)(1)). He also argues that the Court should
\"construe 38 C.F.R. § 3.306(b)(1) in a manner consistent with . . .
Regulation 1063(I)\" (the Secretary concedes that 3.306(b)(1) was
derived from 1063(I)), and \"resolve any interpretive doubt in favor of
the veteran.\" Suppl. Mem. at 6 (quoting Allen v. Brown, 7 Vet.App. 439
(1995) (citing Gardner v. Brown, 115 S. Ct. 552 (1994))). The Secretary
asserts that § 3.306(b)(1) was promulgated pursuant to the Secretary\'s
\"general rule-making authority\" codified in 38 U.S.C. § 501(a) and to
\"the statutory scheme contained in Chapter 11, Title 38\[,\] . . .
specifically 38 U.S.C. § 1110.\" Suppl. Mem. at 7. He argues that §
3.306(b)(1) does not allow service connection for residuals of medical
treatment when there has been no increase during service in overall
disability due to the preexisting condition. Br. at 5. The National
Organization of Veterans Advocates (NOVA), as amicus curiae, agrees with
the appellant that any residuals of in-service medical or surgical
treatment should be considered an increase in disability. Amicus Mem. at
6. NOVA also argues that (1) § 3.306(b)(1) conflicts with 38 U.S.C. §
1153 because the regulation provides that results of in-service medical
and surgical treatment are never service connectable if they result in
\"postoperative scars \[or\] absent or poorly functioning parts or
organs\"; and (2) the regulation improperly shifts the burden of proof
as set forth in section 1153. Amicus Mem. at 4, 6-7.

The interpretation of 38 C.F.R. § 3.306(b)(1) is an issue of first
impression for this Court. The statutory authority cited for § 3.306, as
a general matter, is 38 U.S.C. § 1153. If a regulation exceeds the
authority of the Secretary, the Court must hold it unlawful. See 38
U.S.C. §§ 7261(a)(3)(C); Gregory v. Brown, 5 Vet.App. 108, 112 (1993);
Gardner v. Derwinski, 1 Vet.App. 584, 598 (1991), aff\'d sub nom.
Gardner v. Brown, 5 F.3d 1456 (Fed. Cir. 1993), aff\'d, 115 S. Ct. 552
(1994).

This Court has spoken authoritatively to the interpretation of section
1153 and the aggravation of preexisting disabilities during service. In
Hensley v. Brown, the Court held:

Ratings for disabilities aggravated by service are determined by
\"deduct\[ing\] from the present degree of disability the degree, if
ascertainable, of the disability existing at the time of entrance into
active service, in terms of the rating schedule\".

Hensley, 5 Vet.App. 155, 161 (1993) (citing 38 C.F.R. §4.22). The Court
made clear in Hensley that service connection for aggravation of a
disability includes only the degree by which the disability increased in
severity during service. In addition, the Court stated in Hunt:

Given the plain meaning of 38 U.S.C. § 353 \[now 38 U.S.C. §1153\] and
the purposes of the veterans disability laws, we hold that temporary or
intermittent flare-ups during service of a preexisting injury or disease
are not sufficient to be considered \"aggravation in service\" unless
the underlying condition, as contrasted to the symptoms, is worsened.

Hunt, supra (emphasis added).

A condition that worsened during service and then improved due to
in-service treatment to the point that it was no more disabling than it
was at induction is analogous to a condition that has flared up
temporarily as described in Hunt. In both Hunt and Hensley, although
there was a point during service where the condition was worse than it
was at induction, the degree of disability due to the disorder did not
increase between the dates of entrance and separation. See Hunt and
Hensley, both supra. For example, if strengthening exercises are
prescribed in service for a veteran with preexisting lower back pain
that has worsened in service and the veteran does those exercises and
his back improves so that it is no worse than it was at induction,
service connection would not cover the condition of the veteran\'s back
before medical treatment. The appellant argues that § 3.306(b)(1)
provides that aggravation can be measured based on the difference in the
degree of disability between the date of induction and the date of
medical or surgical treatment, even where the disability was no worse
overall at separation than at induction. He relies in part on the
wording of the superseded Regulation 1063(I), which referred to the
\"degree of disability resulting from enucleations\". It is not
necessary for the Court to decide whether it would be proper to consider
Regulation 1063(I) in the interpretation of 3.306(b)(1), because
Regulation 1063(I) does not support the appellant\'s position \-- it
specifically stated that the \"mere fact of enucleation will not
establish aggravation\". Furthermore, if the Court were to interpret §
3.306(b)(1) as the appellant urges, then that regulation would conflict
with the plain language of section 1153 as interpreted in Hensley and
Hunt, both supra. See Brown v. Gardner, 115 S. Ct. 552, 557 (1994)
(citing Chevron v. NRDC, 467 U.S. 837, 842-43 (1984)). For the following
reasons, the regulation does not bear the appellant\'s reading.

The regulation provides that the \"ameliorating\" \"usual effects\" of
\"medical or surgical treatment\" \"will not be considered service
connected unless the disease or injury is otherwise aggravated by
service\". Thus, the only treatment effects that are not considered
service connected are those that improved the condition and lowered the
level of disability. If a preexisting disability was more severe after
in-service medical treatment, the increase in the level of disability
would be service connectable. For example, if a preexisting 20%
disability increased in severity in service to 60% disabling, and
medical or surgical treatment reduced the degree of disability to 40%,
the remaining 20% in-service increase is service connectable. The
appellant would interpret the words in § 3.306(b)(1) \"unless the
disease or injury was otherwise aggravated by service\" to mean that the
disability in the above example would be service connectable at 40%
because the increase in disability during service from 20% to 60% was
due to factors \"other\" than medical or surgical treatment. However, it
is at least as reasonable (and far more in accord with the statutory
scheme) to interpret the words \"otherwise aggravated\" as referring to
the 20% remaining increase in the disability \-- the amount of
aggravation remaining \-- after the ameliorative effects of surgical and
medical treatment have been considered.

NOVA argues that § 3.306(b)(1) reverses the burden of proof (the
presumption of aggravation) provided for in 38 U.S.C. § 1153. Amicus
Mem. at 6-7. However, the question whether there has been an increase in
disability during service must be answered in the affirmative before the
presumption of aggravation attaches, see Hunt, supra, and § 3.306(b)(1)
has to do with the definition of an increase in disability. Thus, the
section 1153 burden of proof is unaffected by § 3.306(b)(1). NOVA
further argues that § 3.306(b)(1) is inconsistent with section 1153
because the regulation would never allow service connection for
\"postoperative scars\" or \"absent or poorly functioning parts or
organs\" treated in service. Amicus Mem. at 4. This reading of the
regulation assumes that the phrase \"including postoperative scars,
absent or poorly functioning parts or organs\" modifies the subject of
the sentence (\"usual effects of medical and surgical treatment in
service\") rather than the words that immediately precede the phrase
(\"disease or other conditions incurred before enlistment\"). Although
the regulation is not a model of good drafting (and could benefit from a
Secretarial review, see e.g., Hatlestad v. Derwinski, 3 Vet.App. 213,
216 (1992) (quoting Talley v. Derwinski, 2 Vet.App. 282, 286-87 (1992)),
it would be contrary to accepted rules of construction to read the
regulation in a way that is both contrary to its plain language and in
conflict with section 1153 and the Court\'s caselaw interpreting that
statute. See Smith (William) v. Brown, 35 F.3d 1516, 1526 (Fed. Cir.
1994) (citing LaVallee Northside Civic Ass\'n v. Virgin Islands Coastal
Zone Management Comm\'n, 866 F.2d 616, 623 (3d Cir. 1989), for the
proposition that regulations must be construed to avoid conflict with a
statute if fairly possible).

The Court holds that where a preexisting disability has been medically
or surgically treated during service and the usual effects of the
treatment have ameliorated the disability so that it is no more
disabling than it was at entry into service, the presumption of
aggravation does not attach as to that disability. Cf. Hunt, supra.

The appellant argues that although the pain from his bunion may have
been alleviated by the bunionectomy, the operation left him with
limitation of motion in his right great toe and numbness of his right
foot. This raises the question whether an increase in disability can be
service connected as aggravation if in-service medical or surgical
treatment results in an improvement in one facet of a disability but
leads to an increase in another facet of a disability. Section 1153
refers to an increase in disability due to a \"preexisting injury or
disease\", and § 3.306(b)(1) refers to a \"disease or injury\", thus
indicating that aggravation is to be measured in terms of a particular
injury or disease and the disability resulting from that injury or
disease. Hence, when a disability has been made worse in one respect and
improved in another respect by in-service medical or surgical treatment,
the rating schedule should be used to determine if the overall degree of
disability has increased during service. See 38 C.F.R. § 4.22; Hensley,
supra. (The VA rating schedule provides for rating of various aspects of
disabilities. See 38 U.S.C. § 1155. For example, a knee injury might be
rated in terms of limitation of motion and in terms of osteomyelitis.
See 38 C.F.R. § 4.71a, Diagnostic Codes 5000, 5260, 5261 (1994).)

The appellant argues, in the alternative, that the veteran\'s right-foot
condition was more disabling at separation than it was at induction, and
that it remains so today. In part II.B.3.a., the Court held that on
remand, the BVA must order a contemporaneous examination of the
veteran\'s right foot. On readjudication, the BVA must also assess the
results of that examination in connection with the Court\'s holding
today as to the interpretation of § 3.306(b)(1) in determining whether
the veteran\'s right-foot condition was aggravated in service within the
meaning of this opinion and Hunt, supra.

III\. Conclusion

The Court vacates the February 7, 1994, BVA decision and remands the
matters of an increased rating for the right-knee disability (for
expeditious proceedings consistent with this opinion) and service
connection for aggravation of the right-foot condition (for expeditious
further development and readjudication) on the basis of all applicable
law and regulation, and issuance of a new decision supported by an
adequate statement of reasons or bases, see 38 U.S.C. §§ 1153, 5107,
7104(d)(1), 7261; 38 C.F.R. § 3.306; Fletcher v. Derwinski, 1 Vet.App.
394, 397 (1991); Gilbert, supra \-- all consistent with this opinion.
See Veterans\' Benefits Improvements Act, Pub. L. No. 103-446, § 302,
108 Stat. 4645, 4658 (1994) (requiring Secretary to provide for
\"expeditious treatment\" for claims \"remanded\" by BVA or the Court);
Allday v. Brown, 7 Vet.App. 517, 533-34 (1995). A final decision by the
Board following the remand herein ordered will constitute a new decision
which, if adverse, may be appealed to this Court only upon the filing of
a new Notice of Appeal with the Court not later than 120 days after the
date on which notice of the new Board final decision is mailed to the
appellant.

VACATED AND REMANDED.

HOLDAWAY, Judge, concurring in part and dissenting in part: I concur as
to that part of the opinion concerning the claim for residuals of a
bunionectomy. As to the right knee disability, the letter from the
appellant to his representative agreeing to the 10% rating is clear and
unequivocal. I find no ambiguity whatever in that letter; he abandoned
any appeal he may have had as to a higher rating for his right knee
disability. I would further opine that if a clear and unequivocal
withdrawal is made by a claimant, and he is the one who, later,
introduces \"ambiguity\" into the withdrawal, then he should bear the
burden of establishing that the claim was not withdrawn.