UNITED STAT ES COURT OF AP P EALS FOR VETERANS CLAIMS

Nos. 98-2219 AND 99-1164
K EI TH D. S NYD ER , A PP EL L ANT /P ETI TI ONER ,
V
. ANTHONY J. P RI NCI PI , S EC RE T A RY O F V ET ER A N S A FF A I RS , A PPEL L EE /R ES PO NDE NT
.

P A T RI CK D. M C C REA RY , I NTER VE NOR
. On Appellee ' s Motion for Reconsider ation
(De cided Nove mber 14, 2001 )

Kenneth M. Carpenter , of Topeka , Kansa s, was on the plea dings f or the a ppellant/petitioner. Leigh A. Br a dley, Ge ne ra l Co un se l; Ro n G arv in , A ssi sta nt G e ne ra l Co un se l; Michae l A. Le on ar d , Deputy Assistant Gener al Counsel; and Edward V. Cassi dy , J r. , all of Washington, D.C., we re on the ple a din g s f

or the a pp e lle e /r e sp on de nt.
Be fore KRAMER, Chief Judge , and STEI NB ERG and GREENE, Judges

. S TEI NB ERG, Judge : I n a n e a r li e r o p in io n , d a te d O c to b e r 6 , 2 0 0 0 , in th is c a s e , th e Court

vacated a Nove mber 25, 1998, de cision of the B oard of Veter ans' Appea ls (Boa rd or B VA);

rema nded the matter

to the Board with direc tions to dismi ss the matter re g ardingdirec t-pay ment fee elig ibilit y as refer red to the Board by the Department of Veter ans Aff airs (V A) re g ional office (RO); denied the pe titioner' s amende d petition for a wr it of mandamus; and den i ed the Secr etar y ' s J une 1999 motion that the Court undertake r eview of the fe e ag ree ment for r epre sentati o n b efore the Court, beca

use that matter should origin ate at the RO. Snyder v . Gober , 14 Vet.App. 154, 168 (2000) [here inafter Sn

y de r I ]. On November 13, 2000, the Secre tary filed a motion for

rec onsideration or, in the a lternative, f or a f ull-Court review.2

Th e Se c re tary

make s th e fo llo wi ngpri mary a rgume nts : ( 1) Th e Court se e me d to ho ld i n Sn y de r I t hat dec isions of the Comptroll er G ener al ar e binding upon VA, and a ny such holding violates the constitutional separa tion of powers; (2) the dec isions of the Comptroller Gene ral c ited by t h e Court ar e inapposite to the instant ca se and should not be r elied upon eve n as per suasive

a uth or ity ; (3 ) the Court fa ile d to a dd re ss the Se c re tary ' s c on te nti on that so ve re ig n immun ity pr e ve nts VA fr om making a

ny pay ment to the appellant in this case ; and (4) the Court misi nterpre ted its own prec edent in Scates v . Gober , 14 Vet.App. 62 (2000) (en banc), in vac ating the finding s of the B oard as to the elig ibilit y and reasonable ness of the fee agr eeme nt for repre sentation befor e VA reg arding

c la ims fo r a

low -b a c k d iso rd e r an d for a ratin g of tot a l di sa bil ity ba se d o n in div idu a l un e mpl oy a bil ity (TDIU). Motion for Rec onsideration (Mot.) at 3-14. The appellant filed, on Dec ember 4, 2000, a respon s e to th e Se c r e ta

r y ' s mo ti o n a n d f

il e d , o n D e c e mb e r 5 , 2 0 0 0 , a n a me n d e d r e s p o n s e to the Secre tary ' s motion. For the re asons set for

th below, the Court will gr ant the Secr etar y ' s motion for

rec onsideration and w ill reaff irm all parts of the O ctober 6, 2000, opinion with the ex ception of the part re lating to the Sec reta ry ' s first contention above , specific ally part I I .B.1.b., 14 Vet.App. at 164- 65, which will be super cede d b y p ar t I I

. A.2 of this opinion, although the r esult remains the same. Cf. Douglas v. Derwinski , 2 Ve t.A pp . 4 35 , 4 37 (1 99 2) (e n b a nc ) ( re a ff ir min g pa nel opini on

in Douglas v. De rwinski , 2 Vet.App. 103 ( 1992), except for one par t). We will summarize the facts previously befor e the Court (the facts ar e fully stated in Snyder I , 14 Vet.App. at 1 5 6 -6 0 ) an d the Court' s conclusions in Sn y de r I and will then addr ess the Se c re tary ' s o bje c tio ns to c e rt a in o f t ho se c on c lus ion s.

I. Bac kgr ound I n J une 1989, the ve tera

n filed a c l ai m fo r a rating above 40% for a ser vice- connec ted lum bo sa c ra l str a in. Re c or d (R .) a t 27

. A VA RO , in a De c e mbe r 1 98 9 d e c isi on , d e nie d th a t c la im and re duced his r ating to 20% , eff ective in March 1990, a

nd the B oard a g ree d in Dece mber 1990. R. at 18-19, 41. On Mar ch 27, 1991, the veter an appe aled pr o se to this Court the Dece mber 1990 B VAde c isi on . R. at 41. I n May 19 91 , the ve te ra n en te re d in to a

fe e a g re e me nt w itha tto rn e y Ke ith D. Sny der (t h e at t o rney

), the a ppellant in the instant case , for r epre sentation befor e VA on the3

veter an ' s " c la im f

o r v e te r a n s b e n e f

it s b e f o r e [V A ]"

. R. a t 4 3

- 4 4

. I n Ju n e 1 9 9 1 , th e a tt o r n e y filed here a n a pp e a ra nc e a s c ouns e l f

or the ve te ra

n in that a pp e a l and fi le d a no the r f e e a g re e me nt, a lso dated in May

1991, that related t o that Court repr esentation. Eac h fee ag ree ment provided for a 20% conting ency

fee to be withheld and paid dire ctly to the attorney

by the Secr etar

y from any past-due benef its a war ded to the veter an "f

ollowing execution of

this ag ree ment". See , e.g. , R. a t 43 ; se e als o Sn y de r I , 1 4 V e t.A

pp
. a t 15 7. Th e a tto rn e y a pp a re ntl y a lso fi le d tho se fe e a g re e me nts wi th a n RO in J une 1991. See R. at 62, 65, 137, 157. I n October 1991, the parties f iled here a joint motion for

rema nd (R. at 46-49), a

nd the Court g ranted that motion and vacated the De cembe r 1990 B VA decision and r emande d the matter ( R. at 51). On re mand fr om the Court , th e B oa rd , n owc ha

ra c te ri zingthe iss ue s a s th re e se pa ra te c la ims (re storation of a 40% evaluat i o n fo r l u m bosacr al strain; an incr ease d rating , above 40% , for lumbosacra l strain; and a TD I U-rating c laim), rema nded those c laims to the RO. R. at 55, 58-59. I n a n A p r il 1 9 9 3 d e c is io n , th e RO d e n ie d th o s e th r e e c la im s ( R. a t 7 3

- 7 9 ) , a n d in Ju n e 1 9 9 3 the attorney notified the vete ran that he did "not wa nt to continue pursuing this" matter on behalf of the veter an a n d th a t h e w a s " r e tu r n in g [t h e v e te r a n ' s ] V A r e c o r d s " to h im

. R. a t 1 5 2

. I n a De cembe r 1993 BV A dec ision, the Boar d noted that the vete ran ha d ra i s ed an additional cla im, for servic e
connec tion for a psy chiatric disorder, and rema nded that matter for further development. R. at 99- 102. After the RO denied the veter an' s four c laims (R. at 105-07), the B oard r emande d three of the claims to the RO and defe rre d a decision on the TDI U-rating c laim until development of the other three claims was c omplete (R. at 126-30). I n Fe bruar y 1998, the R O restored to 40% the r ating for lumbosacra l strain; awar ded ser vice c onnection for

chronic dy sthy

mic (depr essive) diso rder; and

awa rded a TDIU rating. R. at 132-35. I n April 1998, the RO notified the ve tera n that it had aw ar ded him a lump-sum amount of $1 36 ,9 51 .0 0 in

pa st- du e ben e fi ts f

or the thr e e a wa

rd s, pa id h im $ 10 9, 56 0. 80 , a nd wi thh e ld $ 2 7 , 3 9 0

. 2 0 a s a

" p o t e n t i a l 2 0 % c o n t i n g e n tf e e " t o b e p a i d

d i r e c t l y t o t h e a t t o r

n e y b y t h e S e c r e t a r

y. R. at 144-46. I n th at n o t i fication letter, the RO notified the ve tera n that his case w as being tr a ns fe rr e d to the B oa

rd fo r a " de te rm inatio n o f e lig ibi lity fo r pa y me nt of a tto rn e y fe e s fr om a ny pa stdue bene fits." R. at 146. The Boar d, in an August 1998 l etter, notified the attorney and the ve tera

n that it was consider ing a

reduc tion of the attorney ' s fee . R. at 154-55. I n a November 25, 1998,4

BV A dec ision as to eligibility for pa y ment of attorne y

fee s from past-due benef its and the

re asonableness of the f

ee pr ovided for in a

ny underlying f

ee a g ree ment, the B oard ( 1) denie d elig ibilit y for pa y ment of attorne y

fee s from past-due benef its a s to the neuropsychiatric -disorder claim; (2) c oncluded that " the attorne y is eligible to rec eive pay

ment of attorne y

fee s in connec tion with his repre sentation of the ve tera n befor e VA on the issues of restoration of the 40 pe rce nt rating for a low[-] back disorde r and entitlement to T DI U" ; a nd (3) reduc ed to $0, a s unrea sonable, attorney fee s called f

or in the fe e agreement pertaining to the restora tion of a 40% r ating for a low-bac k disorder a

nd for a TDIU ra t ing. R. at 3, 10. Although the B oard note d that the attorne y had

" a sse rt e d th a t V A h a [d] th e a uth or ity to p a y the fe e fo r se rv ic e s he ha d r e nd e re d th e ve te ra n w hil e repr esenting him before the Court", the Boa rd conclude d that it "may revie w only

the contra ct for

se rv ic e s b e fo re VA " a nd

tha t " [r]e vie w o f [f

e e ] ag re e me nts [fo r r e pr e se ntatio n b e fo re the Court ] is exclusively

within the province of

the Court." R. at 3, 6. On Dec ember 2, 1998, the attorne y appea led that B VA dec ision through other counsel. On J une 29, 1999, the Sec reta ry filed a motion in that appea l, seeking Court reviewof the fe e ag ree ment for the attorney ' s repr esentation before the Court in connec tion with the October 1991 Court re mand. On J uly 12, 1999, the attorne y filed (1) a response opposing the Secre tary ' s motion and ( 2) a pe tition for e x traordina

ry relief in the nature of mandamus. I n the petition, the attorney seeks a Court orde r d i r e c t i n g t h e S e c r e t a r

y ( a ) t o s h o w c a

u s e w h y h e h a d

f a i l e d t o p a y t h e w i t h h e l d

2 0 % t o t h e a t t o r

n e y,
an d (b ) e i t h er t o m ak e i m m ed i at e p ay

m en to r t o d i re ct t h e R O t o m ak e a d ec i s i o n o n t h e a t t o rn ey 's entitlement, beca

use of his re prese ntation of the vete ran befor e this Court, to direct pay ment of the withheld 20% of pa st-due bene fits. There afte r, the Secre tary filed a r esponse, the a ppellant filed a

re ply , a nd the Court , o n O c tob e r 1 , 1 99 9, c on so lid a te d th e a pp e a l and pe tit ion c a se s. On Octobe r 18, 1999, the at t o rn ey fi led an amended pe tition for ext raor dinary relief . He attache d a copy of an October 1, 1999, letter to the ve tera n from the RO that stated that the RO had

e rr on e ou sly

re le a se d to the ve te ra

n, on Se pte mbe r 17, 19 99 , the wi thh e ld 20% of pa st- du e be ne fi ts and that dema

nded that he r eturn those f unds to VA. Amende d Petition, Ex hibit 1. The attorney reque sted relief

based on the "ine x plicable a cti o n " i n making that pay ment to the veter an; specific ally , he requested that the Court (1) or der the Secre tary to show cause as to why

he re lease d the pre viously

withheld 20%; (2) f

ind that the pay

ment to the veter an of that 20% was "a n act of ' bad5

fa ith ' by the Se c re tary " ; ( 3) c on sid e r s a nc tio ns a g a ins t th e S ecret ary fo r m a kin g that pa

y me nt; (4) " direc t the Secre tary

to cre ate a

n overpa y m en t i n the veter an' s acc ount"; and ( 5) orde r the Secre tary to pay that 20% to the attorne y

or orde r the S ecr etar

y to show cause why

a wr it should not be issued. In Dec ember

1999, the Court, inter alia, g rante d intervenor status to the vetera

n. Snyder

v . W est , 13 Vet.App. 244, 248- 49 (1999) (per curiam or der)

. On April 11, 2000, the Court stay ed the matter pe nding the outcome of Scates , su pr a . I n the Octobe r 6, 2000, opinion in Sn y de r I (issued af

ter the e n banc o p i nion in Scates , su pr a ), the Court lifted the pr eviousl y -i m p o s ed stay . After noting that the RO ha d never made a deter mination as to the attorney ' s elig ibilit y to rec eive f

ees under the fee ag ree ments considere d by the B oard, the Court vaca ted t he November 1998 BVA de cision "' for [the Boa rd' s] want of orig inal jur isd ic tio n to de c ide e lig ibi lity fo r d ir e c t pa

y me nt o f a wi thh e ld c on tin g e nc y

fe e un de r [3 8 U .S. C. §] 5904(d)' " a

nd rema nded the matter "' to the Board with directions to dism iss that matter as re fer red to the B oa

rd by the RO .' " Sny de r I

, 1 4 Ve t

. Ap p
. at 1 6 0 (q u o t i n g Scates , 14 Vet.App. at 64). The Court held, inter alia, that "the Secre tary is oblige d by his own re g ulation [ (38 C.F.R. § 20.609(h) )] to pay the attorne y

under a withhold-and-pa y

conting ency -fe e ag ree ment if the statutory and regulatory

require ments are met", S n y de r I , 14 Vet.App. at 164, but denied the petition for extraordinary

relief beca use, the Court held, a s to eac h reque st for re lief that the pe titioner had made , he had not established a clea r and indisputable rig ht to the writ and/or had not demonstrated a lack of adequate alternative means to obta in the relief soug ht, id. at 162-66. F inally , the Court held that the mat ter of th e Court ' s r e vie w o f t he fe e a g re e me nt f

or re pr e se ntatio n b e fo re the Cou rt " sh ou ld orig inate at the RO" and denie d the Secr etar y ' s J une 1999 motion. Id. at 168.

II. Ana lys is A. "B ind

ing " Na ture

of Comptr oll

e r G e ne ra l O pin ion s 1. Snyde r I Anal

y sis
. The Secre tary notes that the Court' s holding in par t I I .B.1.b. of Snyder I , 14 Vet.App. at 164-65, reje cted VAGen. Coun. Prec . 27-92 (De c. 9, 1992), w hich had he ld that VA lac ks the authority to pay attorney fee s under section 5904(d) when a wr ong ful pay ment in the amount of a w ithheld amount has bee n made by VA because , acc ording to the Gene ral Counsel, the full amount of past-due benef its has been e x haust ed. Mot. at 3. The Sec reta ry then states: " The6

panel ba sed its holding on a line of Comptroller Gene ral de ci sions, beg inning with 2 Comp. Gen. 102 (1922), which it found t o support the conclusion that VA had an oblig ation to pay attorney fee s under 38 U .S.C. § 5904(d), even thoug h it required V A t o m ak e duplicate pa y ments." Mot. at 3. The Sec reta

ry contends that " [t ]he Court's dec ision to i nvalidate VA OPGCPR EC [ s i c] 2 7-92 wa s ba se d pr ima

ri ly on the pr e mis e that de c isi on s by the Com ptr oll e r G e ne ra l r e g a rd ingthe le g a l li a bil ity of executive bra

nch age ncies and officia ls in case s wher e funds are e rrone ously rele ased, a

re binding

on su ch agenc ies ", and con clu des th at "[ t] hi s p rem is e is in corr ect ." Ibid. Th e Se c re tary

c ite s Bowsher v. Synar for the proposition that "a n intrusion into the func tion of the e x ecutive br anch [by the C omptroller Genera l, found by the Supreme Court to be a n ag ent of Congr ess, is a] violation of the Separation of Powers Clause of the Constituti on". Bowsher , 4 78 U. S. 7 1 4 , 7 3 6 ( 1 9 8 6 )

. T h e Se c r e ta r y c it e s a n o p in io n o f

th e D e p a rtm e n t o f

Ju s ti c e O f

f ic e o f L eg al Counsel, which conc luded that " the Comptroller Ge n er al , as the a g ent of Cong ress, c annot issue interpre tation[ s] of the law that are binding on the E x ecutive B ranc h." 15 O p. O.L .C. 80, 85 (1991). The Sec reta

ry further cites a N ovember

15, 1995, Depa

rtment of J ustice Orde r that found that the Comptroller Gene ral " does not have the leg al authority to issue de cisions or interpre tations of law that are binding on the E x ecutive B ranc h." D OJ Orde r 2110.39A (N ov. 15, 1995). The Court agr ees that a holding that the decisions of the Comptroller Ge nera l are binding on VA would appe ar to ra ise serious s ep ar ation-of- power s conce rns. Howe ver, c ontrary to the arguments raised by

the Secr etar

y , it is not a settled matter that the Comptroller Gene ral de cisions cited by the Court a

re not binding on VA. The Supreme Court in Bowsher invalidated legislation that purported to g ive a pa rticular de cision of the Comptroller Ge nera l the authori t y t o bind the President. See B owsher , 4 78 U. S. at 73 2- 34 . T he Sup re me Court did no t, h ow e ve r, state that any decision of the Comptroller G ener al could not have binding authority over an executive age ncy . Nor is there any authority binding on this Court to suppor t such a c onclusion. The only authority that the Secre tary offe rs in this reg ard a

re the two J ustice Depa

rtment issuance s cited above , both of which

c on c lud e d th a t th e Com

ptr oll e r Ge ne ra l, a s an a g e nt o f C on g re ss, do e s n ot h a ve the le g a l a uth or ity to i ssu e de c isi on s o r i nte rp re ta tio ns of law that are bin din g on

the Exe c uti ve B ra

nc h. Al tho ug h th e se J ustice De partment issuances m ay be instructive, they

are not binding on this Court and henc e do not settle this is sue.7

Fur ther, Sn y de r I held: "Wher e VA makes an err oneous pay ment to a par

ticular be nefic iary fr om t he c omp e ns a tio n a nd pe ns ion a c c ount, that in no wa y imp a ir s it s a

uth or ity a nd ob lig a tio n to p ay fr o m that fund the amount that is owed to the corr ect be nefic iary ." 14 V et.App. at 164. The op ini on a lso c on c lud e d: " Th e bo tto m li ne is that the e rr on e ou s pa y me nt' s e xiste nc e is i mmate ri a l to th e S ecret ary 's res po ns ib il it y to mak e th e pay

men t t o wh ich th ere i s l awfu l en ti tl eme nt ." Id. at 165. Wh at t he Court held in this subpart of its prior opinion, apar t from the citation to any additional authority , is that, unde r the sta tute and the re gul ations imple menti

ng t hat sta tute , the Secr etar

y has the authority and obli g ation to make pay ments to the correc t benef iciary in case s wher e an inc orre ct benef icia r y h a s a lr e a dy r e c e iv e d p a y me n t. T h is h o ld in g is c le a r ly c o u n te r to th e h o ld in g o f Ge n. Coun. Prec. 27-92 that VA has no authority to pay the correc t benef iciary in that situation. Hence , at the point when the Cour t s t at ed that Gen. Coun. Prec . 27-92 is "in c onflict with the binding opinions of the Comptroller Gene ral discussed be low, and hence is invalid", Sn y de r I , 14 Vet.App.

a t 164- 65 , th e ho ldi ngof

the Court was alre ad

y in c onf lic t wit h (and he nce ha d trumped) Ge n. Coun. Prec. 27- 92. No t wi t h s t an d i n g t h e ab o v e, h o we v er , p artI I

. B. 1

. b

. o f the Sn y de r I o p in ion w ill be superce ded by the instant opinion because of t he potential for that subpart to be read as a st atement of the Court on this separation-of-powe rs issue, and the te x t in part I I .A.2., below, will be substituted in its pl ace
. The Court fur

ther e mphasizes that it m akes no state ment on whether or not d ecisions of the Comptroller Gene ral can be binding on VA. Se e Bu c k lin ge r v . B ro wn , 5 Vet.App. 435, 441 ( 1993) (" it is ' [a] fundame ntal and long -standing principle of judicia l restra int . . . that courts avoid re aching

co n s t i tu t i o n al qu es t i o n s i n ad v an ce o f t h e ne ce s s i t y o f d ec i d i n g t h em '" ( qu o t i n g Ly ng v . No rth west Indian Cemete ry Protec tive Association , 485 U.S. 439, 445 (1988)))

. 2. Repl acem en t A nal

y sis
. Th e re c a n b e no do ub t and we c on c lud e , a s d id t

he Court in Aronson v. De rwinski , 3 Vet.App. 162, 164 (1992) (per curiam order), that the S ecr etar y is obliged, pursuant to the statute and its implementing regulation, to pay the attorne y under a withhold-and-pa

y conting ency -fe e ag ree ment if the statutory and re g ulatory

require ments are met. That is beca use the Secre tary is no less obligate d to take a particular action when the dut y is created by statute than whe n it is create d by

regulation pursuant to express statutory authorization. The law is cle ar that a fe dera l ag ency is bound to follow its own reg ulations as long a s they are in force

. See V

itarelli v. Seaton ,8

35 9 U .S. 53 5, 53 9- 40 (1 95 9) ; Servic e v. D ulles , 354 U.S. 363, 383-89 (1957); Un ite d Stat es e xre l. Ac c ar di v. Sh au gh ne ssy , 3 47 U. S. 2 60 , 2 65 -6 8 ( 19 54 ); Schafrath v. De rwinski , 1 Vet.App. 589, 592 (1 99 1) (B oa

rd no t f re e to i g no re re g ulatio n a do pte d b y VA ); se e als o G riv ois v . B ro wn , 6 Vet.App. 1 3 6 , 1 4 0 (1 9 9 4 ) ( ci t i n g Vi tar e lli , su pr a , f or pr op os iti on

that pr oc e dure s mu st be pro vi de d to a ll simil arly situated VA c laimants). I n th is c on ne c tio n, we str e ss t hat the Se c re tary ' s obli g a tio n an d th e a tto rn e y ' s r ig ht do derive from the statute, which expressly authorizes the Secre tary to make pay ment to the attorney . Wit hout such ex press statutory sanction, t he S ecr etar y , as noted in par

t I I .B.1.a . of Sn

y de r I , 14 Vet.App. at 162-64, would be pr ohibited by the anti-assignment provision of 38 U.S.C. § 5301(a) f rom honoring any such direc t-pay

ment fee -ag ree ment p ro v i s ion. Of equa l importance, the Secre tary , in the exercise of

this statutory

authority , has ele cted to promulg ate a regulation that ma ndates that such pay ment be made to the attorney

. See 38 C.F.R

. § 20.609(h) ( "the claimant or a ppellant and a

n attorney -at-la

w may enter into a fee ag ree ment providing that pay ment fo r the ser

vices of the attorney -at-la

w will be made dir ectly

to the attorney -at-la

w by the Depa rtment of Ve tera

ns Affa irs out of any past-due be nefits awa

rded [to the claimant or a

ppellant] . . . . Such an ag ree ment will be honored by

the Depa rtment . . . ." ). Thus, pursuant to the statute a nd regulation, the S ecr etar y has t he full authority , indeed, the obligation, to pay

the attorney

out of VA' s entitlement acc ount (the compe nsation and pension

a c c ount) jus t a s th e Se c re tary do e s to pa

y a ny oth e r V A c la ima

nt ou t of th at a c c ount, wh ic h is routinely funded by

defic iency appropr iation w hen the amount appropr iated to that acc ount in any fiscal y ear proves inadequate come the end of a f iscal y ear , see , e.g. , 54 Comp. Gen. 393, 395 (1974) (" should applicable a

ppropriation be e x hausted, a defic iency appropr iation would be nec essar y prior to pay ment of additional cla i m s") . We hold that where VA make s an er roneous pa

y ment to a particula r bene ficiar

y , that pay

ment in no way

impairs its authority

and obli g ation to pay from the compensation and pension ac count the amount that is owed to the c orre ct benef iciary . As will be dis c us se d in

g re a te r d e ta il i n p a rt

I I .C. , b e low , th e a mou

nt o we d to the c or

re c t be ne fi c iary , in

fa c t,

re ma ins undi

sturbed in the compensation and pens i o n ac co u n t. Whether or not the Secr etar y decide s to seek to re coup the e rrone ous pay ment is an entirely

differ ent matter. See 38 U.S.C. § 5314 (providing Secre tary with authority

to "de duct t he amount of the indebte dness of a ny person9

who has be en dete rmined to be indebte d to the United States by virtue of such per son' s participation in a benef its prog ram administered by the Secr etar y from future pay

ments made to such pe rson under any law administere d by

the Secr etar

y ") . The Sec reta

ry ' s historic relianc e on VA Gen. Coun. Prec. 27-92 (c oncluding that "V A h as n o leg al authority to pay attorney fee s when pa

y ment of the complete amount of past-due benef its ha s been made to the claimant" ) is pla inly in c onflict with our holding he re a

nd hence is invalid. T h e b o t t o m l i n e i s t h at t h e e rr o n eo u s p ay m en t 's ex i s t en ce i s i m m at er i al t o t h e S ec re t ary 's responsibility

to make the pa

y ment to which there i s lawful entitl ement. These principles ar e g iven expression in the decisions of t he C omptroller Genera l of the United States. E.g. , 2 Comp. Gen. 102, 106 (1922) ( estab li s h in g

th a t, wh e r e V eter ans' Bur eau ma de er roneous pa

y ment to person not entitled there to and wher e anothe r per son is clear ly entitled to th at p ay

ment, it is "duty " of

Direc tor of Veter ans' Bur eau to " make pa y ment to the rig htful claimant . . . irre specti v e o f recovery by the g ov e rn me nt o f the a mou

nt e rr on e ou sly pa id

. . . e ve n th ou g h it inv olv e s th e g ov e rn me nt i n a do ub le pa y me nt, pro vi ded , o f c ours e , th e re ha s b e e n n o c on tr ibutin g ne g lig e nc e or oth e r f a ult c ha rg e a ble to t he pe rs on c la imi ngthe pa

y me nt" ); se e als o 66 Comp. Gen. 617, 619 (1987) (same, as to pay ment to A rm y c on str uc tio n c on tr a c tor ); 37 Com p. Gen

. 13 1, 13 3 ( 19 57 ) ( same , a s to pa y me nt o f d e a th g ratuity under Ser

vicemen' s and Ve tera

ns' Survivor Be nefits Act); 19 Comp. Gen. 104, 105 (1939) (same, a s to Social Security Act pay ment). Ba sed on the fore g oing analy sis in this subpar t, the Court holds that, if the fee ag ree ment has met t h e s t atutory

and re g ulatory

require ments, the Secre tary is require d to make pay

ment to the appellant in thi s case of any portion of t he 20% to which he is found t o be entitled. See I n the Matter of the Fee Agreem ent of Mason , 13 Vet.App. 79, 86 (1999). Be cause there is no connec tion between any overpa

y ment by the S ecr etar

y to the veteran and any

conting ency -fe e amount that the Sec reta ry might under

the circ umstances he re be obligated to pa y direc tly to the attorney , we f

urther hold that the attorne y , "w ho car

ries the bur den in this matter, has not ade quately es t ab l i shed a c lear and indisputable rig ht to a writ" , Cos tan za v . W est , 12 Vet.App. 133, 134 ( 1999) (pe r cur iam order ), as to that specific r el i ef s o u gh t, and the Court thus may not order suc h mandamus re lief. See I n the Matter of the Fee Agreem ent of Cox , 10 Vet.App. 361, 370 ( 1997), vacate d in part on other grounds

s u b

. n o m
. C

o xv
. W est , 14 9 F.3d 1 36 0, 13 63 , 1 36 5- 66 (F e d. Cir . 1 99 8) (a ff ir min g a ll h old ing s;10

v a c a t i n g o n l y f

o r c o n s i d e r a t i o n o f a s s e rt e d f a c t s o c c u r r i n g a f t e r t h i s C o u rt ' s o p i n i o n )

. A c c o r d i n g l y, the petition is moot insofar a s it seeks to compel the Secre tary to c reate an over pay ment ag ainst the veter an, bec ause t h e am o u n t o f the fe e that is owed to the attorney must, in accorda

nce w ith our analy sis in this opinion of the applicable statutory and re g ulatory

provisions, be paid to him by the Secre tary reg ardle ss of any

overpa y ment cre ated a g ainst the veter an. B. Com ptroller General Opinion s as Persuasive Auth ority The Secre tary next ar g ues that the Comptroller Gene ral opinions "r elied upon by the Court . . . do not support the outcome in this case." Mot. at 5-6. The Sec reta ry states in this reg ard:
First, the se minal Compt roller Ge nera l Opinion in thi s line, 2 Comp. Gen. 102 (1922), de alt exclusively

with pay ments to a v et er an base d upon a life insura nce p o l icy . As this Court has recog nized, a VA insuranc e policy is a contra ct betwe en the v et er an and the United States Gover nment. W

olfe v. Gobe r , 11 Vet.App. 1, 2 (1997); 3 8 U

. S. C. § 1 9 1 7

. U n li k e V A ' s o b li g a ti o n to p a y th e p r o c e e d s o f an insurance policy t o the cor rec t benef

iciary , the Secr etar

y does not have a "c ontrac tual" r esponsibility to directly

pay attorney fee s under 38 U.S.C. § 5904(d). Th e on ly " c on tr a c t" in su c h ma tte rs e xists be tw e e n the a tto rn e y a nd his or he r c lie nt. B e c a us e the Un ite d Sta te s wa s n ot a pa rt y to M r. Snyde r' s a tto rn e y -f e e c on tr a c t w ith h is c li e n t, h e c a n n o t s e e k to e n f o r c e th is a g r e e me n t a g a in s t t h e U n it e d States. See Erickson Air Crane Co. v. United States , 731 F.2d 810, 813 ( Fe d. Cir. 1984).
F ur t h e r , t h e C o mp t r o l l e r G e n e r a l d e c i s i o n s c i t e d b y t h e C o u rt p e rta in t o whether disbursing or

cer tify ing of ficials ca n proper ly

make c erta in pay

ments, fre e of liability . . . . T h u s , the Comptroller Gene ral' s decision, which a rose in ver

y differ ent circ um s t an ce s that did not invol ve sover eig n immunit y issues, does not provide a persua sive rationale for the de cision of the Court her e. Mot. at 6-7.
Th e Se c re tary ' s argume nts on thi s p oin t are no t pe rs uasive . H e a tte mpt s to dis tin g uis h 2 Comp. Gen. 102 bec ause it dea lt with contractua l rig hts and the cur rent situation does not arise out of a c ontrac t. H oweve r, this a rg ument ignor es the Court' s conclusion in Sn y de r I , w hic h w e re ite rate today in subpart I I .A.2., above , that (1) the Sec reta ry has an obligation to pay

the attorne y , and (2) thi s o bli g a tio n is de ri ve d f ro m the sta tute

. 1 4 Ve t

. Ap p
. at 1 6 4 (" we s t re s s t h at t h e S ec re t ary 's ob lig a tio n a

nd the a tto rn e y ' s r ig ht do derive from the statute" ). The Secre tary fails to a ddress why a rig ht de rived from a statute (ar g uably a much strong er ba sis for such a rig ht) could be so dissimilar11

from a r ight de rived fr om a contra ct that an opinion dea ling with the c on trac tual rig ht has no pe rs ua siv e a

uth or ity . M or e ov e r, the Se c re tary ' s argume nt t hat Mr . Sn y de r c a nn ot s e e k to e nf or c e thi s
a g re e me nt a g a ins t the Un ite d Sta te s be c a us e the Un ite d St a te s w a s n ot a pa rt y to t he a g re e me nt a g a in clouds the issue by

treating " the attorne y ' s rig ht", ibid. , a s if it we re a ri g ht d e ri ve d f ro m a c on tr a c t, rathe r than fr om a statute. Finally , the Secre tary has fa iled to expl ain why the der ivation of a rig ht fr o m a co n t ra ct wo u l d re n d er t h at ri gh t s u p er i o r t o o n e de ri v edfr o m a s t at u t e. As t o t h e S ec re t ary 's p o i n tab o u tt h i s n o tb ei n g a m at t er o f a d i s b u rs i n g o r c er t i fy i n g o ff i ci al 's l i a b i l i t y f

o r m ak i n g a pay ment, that ar gu m en t is simi larly off point. Of c ourse, Comptroller Ge nera l opinions are ofte n pr e c ipi ta te d b y

re qu e sts fr om suc h off

ic ia ls, wh o ar e e xpre ssl y

a uth or ize d b y

law t o o bta in i mmunit

y from per sonal liability

by reque sting a

nd relying on suc h opinions, see 31 U.S.C. § 3529, but t he Comptroller Gene ral' s opinions ex presse d in response to such r equests have forc e even in situations

n o t d i r e c t l y i n v o l v i n g s u c h o f f i c i a l s ( o f c o u r s e , t h e y ar e involved in the pay ment question befor e us). Be cause the Secr etar

y has provided ve ry

littl e support for

his contention that these Comptroller Gene ral opinions have no persuasive a uth or ity , w e re

je c t th is a rgume nt. C. So v e re ign Imm unity

and Pa y ment T h e S ec re t ary n ex t ar gu es t h at "t h i s C o u rt m i s i n t er p re t ed co n t ro l l i n g p re ce d en t o n s o v er ei gn immunit y ". M o t . at 7. The Sec reta ry ' s pertinent ar g uments on this point are (1) a n argument that the Court fa ile d to a dd

re ss Ruck elshaus v. Sierra Club , 463 U.S. 680 (1983), and Alyesk a Pipeline Se rv ic e Co. v . W

ild e rn ess S oc ie ty , 421 U.S. 240 (1975), cases upon which Gen. Coun. Prec . 27-92 had relied; and (2) an ar g ument that "[p]ay ment of the attorney

fee s out of a sourc e other than the

c la ima nt' s p a st- du e be ne fi ts, ba se d upo n 3 8 U .S. C. § 59 04 (c ) a nd (d ), wo uld

be inc on sis te nt w ith Ruck elshaus and Alyesk

a , as these pr ovisions do not waive sovere ign immunity ". Mot. at 10. As to the Secre tary ' s first argument, he appea rs to be citing to a

passag e in Alyesk

a wher e the Supreme Court stated:

I f, a s re sp on de nts a

rgue , one of

the ma in f

un c tio ns of

a pr ivate a tto rn e y

g e ne ra l is to call public off

icials to acc ount a

nd to insist that they

enfor ce the law, it would follow in such ca ses that attorney s' fee s should be awa rded a g ainst the Gover

nment or the officia ls themselves. I ndeed, that very claim was a sserted in this case . But [section 2412 of the Miner al L and L easingAct] o n i t s fa ce, and in light of its leg islative12

his tor y , g e ne ra lly

ba rs su c h a wa rd s, whic h, if

a llo wa ble a t a ll, mus t be e xpre ssl y provided for

by statute . . . . Alyesk a Pipeline Serv ice Co. , 421 U.S. at 267-68 (footnotes omi tted). The S ecr etar y then relies on Ru c k e lsh au s for the p ro p o sition t hat " [e] x cept to the e x tent it has waived its immunity , the Gover nment is imm une fr om claims for attorney [] fee s". Ruck elshaus , 463 U.S. at 685. The dire ct applicability

of either of these two c ases to the instant c ase seems dubious; both ca ses ar e addr essing sit ua tio ns wh e re the pr e va ili ng pa rt y is s e e kin g fe e s f

r o m the opposite party . I n the instant case , the fee s under contention are fee s paid from a n amount awa

rded to t he pe tit ion e r's c lie nt , 14 Vet.App. at 159. Thus, it does not appea r to the Court that these c ases a re dire ctly controlling in this case, and there was, ther efor e, no over riding nece ssity

to addre ss them in Sn

y de r I

. As to the Secre tary ' s second a rg ument , i t ap p ea rs to be re ly ing on the assumption that any pay ment of attorne y

fee s made subseque nt to the Court's opinion would be c oming out of a source other than the veter an' s past-due be nefits and that, c onsequently , the S ecr etar y would have no authority to make such a

pay ment. This r ea soning is fatally flawe d beca

use it relies on the assumption that the errone ous pay ment to the veter an, on S eptember 17, 1999, its e lf

came from the veter an' s past-due be nefits. Howe ver, a s laid out in Sn y de r I , 14 Vet.App. at 1 64-65 (a nd as reiter ated in par

t I I .A.2., above ), a n d as is inherent in 38 U.S.C. § 5904(d)(2) (A)( i) (" [a] fee ag ree ment ref

err ed to in para g raph (1) i s one under which the total amount of t he fe e pay able to the attorney

. . . is t o b epa id t o t h e a t t o r

n e y b y t h e S e c r e t a r

y dire c tly from any past-due benef its awarde d on the basis of the c laim" ( emphasis adde d)) a nd in 38 C.F .R. § 20.609(h) (" the claimant or appellant and an attorney -at-la

w m ay enter into a fee a g ree ment providing that pay ment for the se rvice s of the attorney -at-la

w will be made dire c tly to t he att or ne y -a t- law by the De pa rtme nt of V

e te ra ns Af fa irs

ou t of an y pa st- due be ne fi ts a wa rd e d a s a re su lt o f a

su c c e ssf ul a pp e a l to the B oa

rd " (e mph a sis

a dd e d) ), the Se c re tary

is obligated to withhold and pay this amount. (The amount of such pay ment would, of cour se, be subjec t to review, a s an incident of r eview of the underly ing f ee a g ree ment. See 38 C.F .R. § 2 0. 60 9( i) ; Sn

y de r I , 14 Vet.App. at 165 (" if the fe e ag ree ment has met the statutory and regulatory

require ments, the Secre tary is require d to make pay

ment to the appellant in this case of any portion of the 20% to whic h he is found to be e ntitled"))

.13

There fore , in order to a cce pt the underly ing a ssumption i n the Secr etar y ' s argument, we would have to e ndorse the vie w that the Secr etar y rele ased the veter an' s withheld funds i n a manne r other than as direc ted by the veter an and therefore in contravention of t he statu te and regulati on
. I n other words, to a g ree with the Secre tary ' s argument, the Court w ould have to ac cept the position that the Secr etar

y , in the se situations, ac ted contra ry to the law as to his sec tion 5904(d) obligation, wher eas under the theory

in Sn y de r I the Court is making no de termination or assumption about the leg ality of the pay

ment to the veter an of an amount equa l to the withheld amount. That is a matter betwee n the S ecr etar

y and the veter an. Cf. 38 U.S.C. §§ 5302(a) (pr oviding that wa iver of c ollection of ov e rp a y me nt m a y be g ra nte d " wh e ne ve r t

he Se c re tary de te rm ine s that r e c ov e ry wo uld be a g a ins t

e qu ity a nd g oo d c on sc ie nc e " ), 53 14 (p rov id ingfo r d e c lara tio n o f o ve rp a y

me nt a nd of fs e t a g a ins t other due benef

its). Th a t is wh y

the Court , in

the un de rl y in g op ini on , h e ld t hat " [t]he Se c re tary

ha s th e fu ll authority . . . to pay

the attorne y

out of VA' s entitlement acc ount . . . just a s it doe s to pay any other VA cla imant out of that acc ount". 14 Vet.App. at 164. This conclusion derives f rom the conc ept that the Secr etar

y ' s proper course of ac tion in a section 5904(d) c as e wh ere an amount has be en
err oneously

paid to the veter an is as follows: The Sec reta ry pay s 80% o f p as t -d u e benef its to t he veter an and the rea fter e rrone ously rele ases f rom an unidentified a ccount a n amount equivalent to the 20% withheld. The Sec reta ry may there afte r (a fter a

ny appropr iate fe e-a g ree ment-re view deter mination as t o elig ibilit y and perhaps as to rea sonablene ss) rele ase some or all of the 20% of withheld p ast-due be nefits, which a mount has remaine d undi sturbed in VA' s entitlement acc ount (a nd , a ft e r a pp e a ls h a ve be e n e xha

us te d a s to su c h p a y

me nt, the Se c re tary

re le a se s a ny re ma ind e r t o the veter an). This r easoning rende rs the Secre tary ' s arguments of no we ight, be cause he assumes that the later-release d am o u n t o f withheld past-due be nefits is an ad dit ion al amount, rathe r than a pay ment from the or igina l 20% of withheld funds; howeve r, the Secre tary provides no author ity for

su c h a n in te rp re ta tio n. Th e re fo re , t h e C o u r t r e j e c ts the Se c re tary ' s argume nt t hat so ve re ig n im mun ity pr e ve nts a ny

pa y me nt t o th e a

pp e lla nt o f t he pr e vio us ly

wi thh e ld 2 0% of

pa st- du e be ne fi ts. D. Sc ate s Finally , the Secr etar

y argues that the Cou rt misapplied the holding of Scates , su pr a , when it vacate d the Novembe r 25, 1998, Boa rd decision here a

nd, pursuant to Scates , rema nded the matter14

to the Boa

rd with dire ct i ons to dismi ss the matter a s it had been r efe rre d to the Boa rd by the RO. The Sec reta

ry cont ends t hat this holding of the Court is over broad, in that it also enc ompassed a deter mination of the Boa

rd that any attorney fee (for repr esentation be fore VA) in e x cess of $0, from past-due be nefits awa

rded to the veter an based on restoration of a 40% rating f or a low- back disorde r and the g rant of a

TDIU rating, wa s excessive and unre asonable . Mot. at 11-12. The Sec reta ry makes four

arguments, which we will address sepa rate ly below. 1. Holdin g of Scates
. First, the Sec reta ry maintains that the holding of Scates pe rt a ine d to elig ibilit y deter minations, not t o rea sonablene ss determinations. This contention is co rr ec t , and Sn y de r I never stated to the contra

ry . I n Scates , the Court he ld that "a ll issues invol ving e ntitlement

or e lig ibi lity fo r at tor

ne y fe e s und e r dir e c t- pa

y me nt co nti ng e nc y -f

e e a g re e me nts , a s c on tr a ste d w ith the iss ue s o f re a so na

ble ne ss an d exce ssi ve ne ss, mus t fir st b e a dd re sse d b y the RO in a c c or da

nc e wi th the normal a djudication proce dures a nd cannot be the subject of sua sponte or o t h er o ri ginal (on

mo ti on ) BVA re vi ew. " Scates , 14 Vet.Ap p
. at 6 4

. We said in Sn y de r I only the following : "The Court held in Scates that the de te rm inatio n of en tit le me nt or e lig ibi lity fo r at tor ne y fe e s und e r d ir e c tpay men t co nt in gency -fee agreem ent s m us t f ir st be ad dres sed by

th e R O." Sn

y de r I , 14 Vet.App. at 160. 2. Se c re tar

y 's A utho rit

y to R e v ie w Dire c t-

Pa y ment Fee Agre e ments fo r Re as ona ble ne ss. As to the Secre tary ' s second a rg ument, t h at h e i s p rovi ded author ity to reviewfee ag ree ments for

rea sonablene ss by

38 U.S.C. § 5904(c)(2) apar t and independe nt from any RO determination of elig ibilit y , this is an issue that the Court has not previous l y addre ssed direc tly

in the context of direc t-pay ment fee ag ree ments. The Sn y de r I opinion stated that "[a]ny revie w by

this Court of the

re a so na ble ne ss o f t

hat f e e a g re e me nt w ou ld b e pr e ma tur e un til e nti tle me nt a nd e lig ibi lity

a re fi rs t deter mined", Sn

y de r I , 14 Vet.App. at 167; however , this state m en t wa s m ad e in t he conte x t of a discussion about the fee ag ree ment for r epre sentation befor e the Cour t , not for repre sentation befor e the B oard or

VA. Cf. Car

penter v . P r i n cipi , 15 Vet.App. 64, 93 ( 2001) (e n banc) (Kra mer, C.J ., dissenting) (" I n addition, this C ourt has stated that any revie w of reasona

bleness would be pr emature until eligibility

is fi rs t d etermined. See Sny der v. G ober , 14 Vet.App. 154, 167 ( 2000), mot. for recons. filed (N ov . 13, 20 00 ). As su min g that the re is a se qu e nti a l r e la tio ns hip be tw e e n e lig ibi lity15

a nd re a so na ble ne ss, Ibe lie ve that be fo re the Court c a n a dd re ss re a so na

ble ne ss, it mus t f

ir st a dd re ss the under ly ing thr eshold issue of elig ibilit y .")

. I n or de r to a c c e pt the Se c re tary ' s a rgume nt on thi s po int , we wo uld have to c on c lud e that a d e t e r m i n a t i o n o f

e l i g i b i l i t y is not

a nece ssary predic ate to a deter mination of the rea sonablene ss of fee s provided for

in a direc t-pay

ment fee ag re em en t under whic h the Secr etar y may have a n obligation to withhol d money from the claimant and pa y it to the claimant' s attorney . Howeve r, such

a fi nd ingwo uld

e nta il a str a ine d re a din g of

the statut e a s w e ll a s a

re su lt that is in c on fl ic t w ith sim ila r c on c e pts a t w or

k in a n a na log ou s are a

of the Court ' s c a se law i nv olv inga tto rn e y -f e e pa y me nts made by the S ec re t ar y

– under the Equal Ac cess to Just ice Ac t, 28 U.S.C. § 2412(d) (EAJA), discussed inf

ra . As no te d, the Se c re tary su pp or ts h is a rgume nt h e re by

re lia nc e on the a uth or ity in 3 8 U .S. C. § 5904(c) (2) that " [t ]he Boar d, upon its own moti on or the re quest of either pa rty , may revie w such a [direct-pa

y ment] fee agr eeme nt and may order a re duction in the fee called f or in the ag ree ment if the B oard f

inds that the fee is ex cessive a nd unrea sonable" . Under Scates , th e Bo ar d cannot addre ss eligibility

in the first instance unde r a dire ct-pa y ment fee ag ree ment. Scates , 14 Vet.App. at 64. Ther efor e, any

Boa rd " revie w" in the first instance of a dire ct -p aym en t fe e agr eeme nt can

a dd re ss onl y the subject of rea sonablene ss. The question then bec omes whethe r B oard r eview in the first instance of the reasonablene ss of t he fee provided for in such a direc t-pay ment fee ag ree ment must follow sequentially

an R O deter

mination as to eligibility

(just as it follows sequentially the dis cu s s i o n o f eligibility

in the statute, c om

pa re 38 U.S.C. § 5904(c)(1) with § 5904(c) (2)) , or whether such re view ca

n be conduc ted tempora lly in d ep en d ent from an RO determination of

e lig ibi lity un de r s uc h a

dir e c t- pa y me nt a g re e me nt. Un de r the Se c re tary ' s argume nt, the B oa rd c ou ld appar ently

order a re duction in the fee called f or in such an a g ree ment befor e the lawf ulness of that

a g re e me nt ( i.e ., the e lig ibi lity of the pa rt ie s to ent e r int o suc h a g re e me nt o bli g a tin g the Se c re tary to make a direc t pa

y ment to the attorney

) is settled. Howe ver, pur suant to section 5904(c )(1) , "a fee may not be cha

rg ed, a l l o we d , or paid" unless a fe e ag ree ment is leg ally valid (i.e., filed a fter the BV A first make s a final de cision, and whe n an attorne y is retained w ith respe ct t o that case befor e the end of the one- y ear period be g inning on that date). The Secre tary ' s argument puts the car t before the horse by

sanctioning situations, such as the instant one, whe re the Boa rd i s o p i n ing on the16

rea sonablene ss of fee s to be paid to attorney s by VA under such agr eeme nts that may potentially

be found to be leg ally

invalid. The Sec reta

ry ' s argument on this point also runs counter to the deter minations by

the Court in the roug hly

analog ous are a of attorney fee s paid by

the Secr etar

y under the EAJA. The Court has

s t a t e d i n t h a tc o n t e xt

t h a t" [t ]h e r e a r e t h r e e p r e d i c a t e r e qu i r e m e n t s t o t h e C o u rt ' s g r a n t i n g a n E A JA application" and that " [ o ] n ce the claimant c rosses this statutory threshold, ' [i ]t rema ins for the [C ourt] to determine what fe e is " rea sonable" ' ". Cullens v. Gober , 14 Vet.App. 234, 240 ( 2001) (e n banc) (quoting He ns le

yv . Ec k e rh ar t , 461 U.S. 424, 433 (1983))

. Se e als o S an do v al v . B ro wn , 9 Vet.App. 177, 179 ( 1996) (de scribing "pr edicate re quirements for an aw ard of E AJ A fe es " that

mus t pr e c e de Court

de te rm inatio n of wh a t c on sti tut e s a re a so na ble fe e ); Vi da l v . B ro wn , 8 Vet.App. 488, 490-91 (1996) (same) ; Do ria v . B ro wn , 8 Ve t.A pp . 1 57 , 1 61 (1 99 5) (s a me ); Ut tie ri v . B ro wn , 7 Vet.App. 415, 416-17 (1995) ( same). T here does not appe ar to be a basis for deter mining her e that

re vie w o f t

he re a so na

ble ne ss o f f

e e a g re e me nts fo r d ir e c t V A p a y me nt u nd e r s e c tio n 5 90 4( d) is s o differ ent from a

revie w of the r easona

bleness of EA J A fe es that a r ev i ew o f el i g ibilit y should not here also be c onsidered a predic ate r equire ment. No r i s t h er e a n y

o v erri d i n g p o l i cy i m p l i c a t i o n t h at wo u l d s ee m t o fa v o r t h e S ec re t ary 's

a rgume nt t

hat a re a so na ble ne ss d e te rm inatio n c a n b e ma de be fo re fe e -p a y me nt eligi bi li ty

is addre ssed in a dire ct-pa

y ment fee -ag ree ment situation. Rather, the statute and ana logous c asela w all point to the conclusion that a finding of elig ibilit y is a prer equisite to the Boa rd' s revie w of the

rea sonablene ss of a dire ct-pa y ment fee ag ree ment. We there fo re h o l d that section 5904(c )(2) require s that determinations of e ligibility (which, unde r Scates , 14 Vet.App. at 64, must be done by the RO in t

he fi rs t in sta

nc e ) a re a pr e re qu isi te fo r a ny

B oa rd re vie w o f t

he re a so na

ble ne ss o f a

dir e c tpay ment fee ag ree ment. Thus, we reje ct the Secre tary ' s argument on this point . We express no view

a bo ut t his same qu e sti on

a s it may be pr e se nte d in the c on te xt of VAre vie w o f t

he re a so na

ble ne ss of a non- direc t-pay

ment fee ag ree ment, such as wa s involved in Carpenter , 15 Vet.App. at 76-80. But cf. id. at 84 n.14 (Steinberg , J ., concur ring in par t an d d i s s en ting in par t) (" it appear s that the B oa rd ha d n o ju

risd ictio n o ve r t

hat [e lig ibi lity ] iss ue " ); id. at 9 3 -9 4 (Kra m er , C

. J

. , d i s s en t i n g) (p oin tin g ou t th a t " ma

jor ity fa ils to a dd

re ss" the " un de rl y ingthr e sh old iss ue of e lig ibi lity " be fo re it ad dre s s ed"r ea s o n ab l en es s ")

. W e d ea l h er e o n l y wi t h th e ci rc u m s t an ce s p re ce d en tt o t h e S ec re t ary 's17

fulfilling his oblig ation to pay the attorne y

a re asonable fee withheld from an a war d of past-due be ne fi ts t o th e c lie nt. 3. Holdin g of Sc at e s as to R e as ona ble ne ss D e te rminat

ion s. The S ecr etar

y ' s third argument is: "The f ull Court in Scates deter

mined, int e r a lia , th a t onl y the iss ue of

' e nti tle me nt o r e lig ibi lity for attorney

fee s under dire ct-pa

y ment conting ency -fe e ag ree ments, as contra sted with the issues of

rea sonablene ss and excessiveness, must first be addressed by the RO' ". Mot. at 12 (emphasis adde d). This is a misst atement of the Court' s holding in Scates . The a ctual text of Scates is: "[W ]e hold that all issues involving entitl ement or elig ibilit y for attorney fee s under dire ct-pa

y ment conting ency -fe e ag ree ments, as contra sted with the issues of re as o n ableness and excessiveness, must first be addre ssed by

the RO in acc ordanc e with the norma l adjudication proc edur es an d cannot be the

su bj ectof s ua s po nt e or o th er o r i gi n a l ( o n m ot io n) BVA revi ew. " Scates , 14 Vet.App. at 64. Notwithstanding the Secre tary ' s char acte rization of t his lang uag e, we find no indication in the Scates text that the Court wa s s an ct i oning a view that a r easona

bleness dete rmination could be made

c omp le te ly ind e pe nd e nt fr om a ny de te rm inatio n a s to e lig ibi lity . F ur the r, the re is n o in dic a tio n in Scates that the B oard de cision u nder r eview in that c ase ha d considere d rea sonablene ss. Scates , 14 Vet.App. at 63-65. Henc e, eve n if the Scates opinion could be re ad as the Secre tary sug g ests, any such statement by

the Court in Scates would be dictum. Nor ha s the Secre tary offe red a ny evidenc e
o r ar gu m ent t o support such a r eading . Finally , even w ere the Court to ag ree with the Secre t ar y 's argument, that woul d h av e no impact on the r esult here beca use the issue that re mains undecide d fr om Scates i s whether

the RO, afte r dete rmining e ligibility , can , in the fi rs t in sta

nc e , a dd re ss
re as o n ab l en es s an d

ex ce s s i v en es s
. T h a t i s n o t d ec i d edh er e. T h er ef o re , we re j ec tt h e S ec re t ary 's

a rgume nt o n th is p oin t a s w e ll. 4. Board's Eligibility Determin ation Favorable to the Appellan t. Fi n al l y , t h e S ec re t ary 's fo ur th a rgume nt i s: I f the C o u rtr e m a n d e d

t h e r e a s o n a

b l e n e s s d e c i s i o n b e c a

u s e t h e B o a r d

f i rs t deter mined that Appellant wa s elig ible for pa y ment of attorne y

fee s from past-due benef its a s to th o s e c la im s , th e Se c r e ta r y w o u ld s u b mi t t h a t t h e Co u rt l a c k ed jur isd ic tio n o ve r t

hat e lig ibi lity

de c isi on . A s th a t pa

rt of its decis io n was fu lly fa vo ra ble to A pp e lla nt a nd no t app e a le d by him , the re e xiste d no ca se or c on tr ov e rs y with respec t to it for the Court to consider. As this Court held in Mc Ra e v . B ro wn , 9 Vet.App. 229, 233 ( 1996) (pe r cur iam)[,] and Ma sse yv . B ro wn , 9 Vet.App. 134,18

13 6 ( 19 96 ) ( pe r c ur iam or de r) , the Court la c ks jur isd ic tio n o ve r i ssu e s in a c a se a s to w h i c h t h e r e e x i s t s n o c a s e o r c o n t r o v e r s y. M o t

. a t 1 3

. T h i s a r g u m e n t m i s a p p r e h e n d s t h e n a tu r e o f b o t h t h e B o a r d ' s a n d t h e C o u rt ' s a

u t h o r i t y. As t h e Court held in Scates , the Boa rd l a c k s j u r i s d i c t i o n t o m a k e a d e t e r m i n a t i o n a s to elig ibilit y
. Scates , 1 4 V e t.A pp . at 64 . A lth ou g h th e no tio n th a t de te rm inatio ns th at a re fu lly favor able to a V A claimant should not later be r ev i s i t ed b y the Court has a g rounding , see , e.g. , Nolen v. Gobe r , 2 22 F .3 d 1 35 6, 13 60 (F e d. Cir . 2 00 0) (h old ingthat determ in atio n o f w e ll g roundedne ss, once made , cannot be revisited by Court), there is no instance in the case law, nor ha s the Se c re tary

pr ov ide d a

ny su pp or t to the c on tr a

ry , w he re the Court

ha s a c kn ow le dg e d th a t, b e c a us e a B o ar d fi n d i n g wa s fa v o rab l e t o an ap p el l an t , t h e C o u rt i s al l o wi n g t h atfi n d i n g t o s t an d ev en t h o u gh it was made w ithout the Boar d' s having jurisdiction to make it. I ndeed, in a differ ent context, the U.S. Court of Appea ls f or the Fe dera l Circ uit ha s alre ady reje cted an argument t h at a f i n ding favor able to an a

ppellant must stand even thoug h the B oard m ay n ot have jurisdiction to hear the

case
. Se e Ba rn e tt v. Br own , 83 F.3d 1380, 1383 (F ed. Cir. 1996) (holding , in a case wher ein RO had made implicit finding that new and material evidenc e had been prese nted to reope n previously and fi na lly dis a llo we d c la im, " that th e B oa rd do e s n ot h a ve jur isd ic tio n to consid e r a c la im w hic h it pr e v io u s ly a d

ju d ic a te d u n le s s n e w a n d mate r ia l e v id e n c e is p r e s e n te d , a n d b e f o r e th e Boa rd may reope n such a c laim, it mus t so find [ expressly ; w]hat the reg ional office may have determined [on this point ] i s irrele vant" ), aff' g 8 Ve t.A pp . 1 (1 99 5) . Ac c or din g ly , a lth ou g h it may be the g e ne ra l r

ule that th e re is n o c a se or

c on tr ov e rs y

a s to a B VAde ter mi nati on

that w a s f

a vo ra ble to a n a pp e lla nt, that is not the case w here the BV A lacke d jurisdiction to make the deter mination in the first instance. Under such circ umstances, we ca n

– i n deed, w e ar e g ener ally obligated to – examine whether the BV A had jurisdiction to addre ss the issue. There fore , we r ejec t the Secre tary ' s argument that we lac k jurisdiction to ex amine the B oard' s determination as to the elig ibilit y of the a ppellant to collect a

fee

un de r t his fe e a g re e me nt.

III. Conclusi on I n view of the fore g oi n g discussion and afte r consider ation of the Sec reta ry ' s motion for

re c on sid e ratio n, tha

t mo tio n is g ra

nte d, a nd the Court ha s re c on sid e re d th e pr e vio us op ini on in t his19

c a s e
. T h e Co u rt r e a f

f ir ms th e o r ig in a l o p in io n in Sn y de r I wi th the exception of part I I .B.1.b. the re of , 1 4 V e t.A

pp . at 16 4- 65 , w hic h is su pe rseded by part I I .A .2 ., a bo ve , a lth ou g h th e re su lt

rema ins the same.

REC ON SI DE RA TI ONGR AN TE D A

ND OR I GI

NA LOPI NI ON REA F F I RME D I

N PA RT AND SUPERSEDED I

N PART.