PREC 12-97    Payments of Attorney Fees from Past-due Benefits under 38 U.S.C. § 5904(d)    Citation: Vet. Aff. Op. Gen Couns. Prec. 12-97, VAOPGCPREC 12-97, 1997

QUESTION PRESENTED:

a.  Whether an attorney representing a successful claimant

before the Department of Veterans Affairs (VA) may collect

attorney fees under the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412(d), and from past-due benefits under 38 U.S.C. § 5904(d), without refunding to the claimant the amount of the smaller fee?

b.  If an attorney may not collect both an EAJA fee and a

section 5904(d) fee without refunding to the claimant the smaller fee, what action must the Board of Veterans’ Appeals (Board) take where the attorney is otherwise eligible for

attorney fees under both the EAJA and 38 U.S.C. § 5904(d)?

c.  Where a case has been remanded or reversed by the United States Court of Veterans Appeals (CVA), must the Board, as a matter of practice, in making its determination as to either payment of attorney fees from past-due benefits under 38 U.S.C. § 5904(d) or reasonableness of fee under 38 U.S.C. § 5904(c)(2) determine whether the attorney has received fees under the EAJA?

HELD:

a.  The claimant’s attorney is permitted to seek recovery of attorney fees under both 38 U.S.C. § 5904 and 28 U.S.C. § 2412.  Section 506(c) of the Federal Courts Administration Act of 1992 expressly provides that, where the claimant’s attorney receives fees for the same work under both 38 U.S.C. § 5904(d) and 28 U.S.C. § 2412, the claimant’s attorney must refund to the claimant the amount of the smaller fee.  The attorney may keep the larger of the fees recovered, but must return the amount of the smaller fee to the claimant.

b.  There is no authority for the Board to take any action, such as offset of the amount of the EAJA fees, to ensure that the attorney fulfills his responsibility to refund the smaller fee to the claimant.

c.  Where the case has been remanded or reversed by the CVA, the Board does not have to first determine whether the attorney has received fees under the EAJA to determine whether attorney fees are payable directly by VA from past-due benefits under section 5904(d). Where the attorney fee agreement does not require direct payment by VA from past-due benefits under section 5904(d), the Board’s review of the agreement under 38 U.S.C. § 5904(c)(2), to determine whether the fee is excessive or unreasonable, may require the Board to determine whether the attorney has received fees under the EAJA and if so, the impact of the EAJA fees on the reasonableness of the agreed-upon fee.  Thus, where a case has been remanded or reversed by the CVA, the Board, in making its determination as to whether the attorney fee is excessive or unreasonable under 38 U.S.C. § 5904(c)(2), must determine on a case-by-case basis the impact of any attorney fees received under the EAJA.