Arellano v. McDonough

• Decision Date: 17 June 2021
• Docket Number: 2020-1073
• Citation: 1 F.4th 1059
• Parties: Adolfo R. ARELLANO, Claimant-Appellant v. Denis MCDONOUGH, Secretary of Veterans Affairs, Respondent-Appellee
• Court: U.S. Court of Appeals — Federal Circuit

1 F.4th 1059

Adolfo R. ARELLANO, Claimant-Appellant

v.Denis MCDONOUGH, Secretary of Veterans Affairs, Respondent-Appellee

2020-1073

United States Court of Appeals, Federal Circuit.

Decided: June 17, 2021

James R. Barney, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Washington, DC, argued for claimant-appellant. Also represented by Alexander Edison Harding, Kelly Horn.

Barbara E. Thomas, Commercial Litigation Branch, Civil Division, United States Department of Justice, argued for respondent-appellee. Also represented by Brian M. Boynton, Claudia Burke, Martin F. Hockey, Jr., Andrew James Hunter; Christina Lynn Gregg, Y. Ken Lee, Office of General Counsel, United States Department of Veterans Affairs, Washington, DC.

Melanie L. Bostwick, Orrick, Herrington & Sutcliffe LLP, Washington, DC, for amicus curiae Military-Veterans Advocacy Inc. Also represented by Anne Savin; John B. Wells, Law Office of John B. Wells, Slidell, LA.

Jillian Berner, UIC John Marshall Law School Veterans Legal Clinic, Chicago, IL, for amicus curiae National Law School Veterans Clinic Consortium.

Liam James Montgomery, Williams & Connolly LLP, Washington, DC, for amici curiae National Organization of Veterans' Advo-cates, Inc., National Veterans Legal Services Program. Also represented by Debmallo Shayon Ghosh, Anna Johns Hrom ; Brian Wolfman, Georgetown Law Appellate Courts Immersion Clinic, Washington, DC.

Hannah Lauren Bedard, Kirkland & Ellis LLP, Washington, DC, for amicus curiae Charles J. Raybine. Also represented by William H. Burgess.

Paul Wright, Marietta, SC, as amicus curiae, pro se.

Before Moore, Chief Judge^* , Newman, Lourie, Dyk, Prost^** , O'Malley, Reyna, Wallach^*** , Taranto, Chen, Hughes, and Stoll, Circuit Judges.

Concurring opinion filed by Chen, Circuit Judge, in which Moore, Chief Judge, and Lourie, Prost, Taranto, and Hughes, Circuit Judges, join.

Concurring opinion filed by Dyk, Circuit Judge, in which Newman, O'Malley, Reyna, Wallach, and Stoll, Circuit Judges, join.

Per Curiam.

Upon consideration en banc, a unanimous court holds that equitable tolling is not available to afford Mr. Arellano an effective date earlier than the date his application for benefits was received.

The court is equally divided as to the reasons for its decision and as to the availability of equitable tolling with respect to 38 U.S.C. § 5110(b)(1) in other circumstances. The effect of our decision is to leave in place our prior decision, Andrews v. Principi , 351 F.3d 1134 (Fed. Cir. 2003), which held that principles of equitable tolling are not applicable to the time period in 38 U.S.C. § 5110(b)(1).

Accordingly, the judgment of the United States Court of Appeals for Veterans Claims is affirmed.

AFFIRMED

COSTS

No costs.

Chen, Circuit Judge, with whom Moore, Chief Judge, and Lourie, Prost, Taranto, and Hughes, Circuit Judges, join, concurring in the judgment.

By statute, the "effective date of an award" of disability compensation to a veteran "shall not be earlier than the date" the veteran's "application" for such compensation is received by the Department of Veterans Affairs (VA). 38 U.S.C. § 5110(a)(1). Section 5110(b)(1), however, provides an exception that permits an earlier effective date if the VA receives the application within one year of the veteran's discharge from military service: under such circumstances, the effective date of the award shall date back to "the day following the date of the veteran's discharge or release." Id . § 5110(b)(1). This case poses the question of whether, under an equitable-tolling theory, an award on an application received more than one year after the veteran's discharge date may still be accorded an effective date of the day after discharge. Specifically, we consider whether the rebuttable presumption of equitable tolling for statutes of limitations established in Irwin v. Department of Veterans Affairs , 498 U.S. 89, 111 S.Ct. 453, 112 L.Ed.2d 435 (1990), applies to the one-year period in § 5110(b)(1).

This question arises from Adolfo R. Arellano's appeal from a decision of the Court of Appeals for Veterans Claims (Veterans Court) denying him an effective date earlier than the date his disability benefits application was received by the VA. Though Mr. Arellano filed his application more than 30 years after he was discharged from the Navy, he argues that § 5110(b)(1) ’s one-year period should be equitably tolled in his case to afford his award an earlier effective date (and his compensation an earlier starting date) reaching back to the day after his discharge from service.

Mr. Arellano also urges us to overrule our prior decision in Andrews v. Principi , which held that § 5110(b)(1) is not a statute of limitations amenable to equitable tolling but merely establishes an effective date for the payment of benefits, thereby categorically foreclosing equitable tolling under this provision. 351 F.3d 1134, 1137–38 (Fed. Cir. 2003). Because this court sitting en banc is equally divided on this issue, our decision today does not alter our precedent that § 5110(b)(1) is not a statute of limitations to which Irwin ’s presumption of equitable tolling applies. Accordingly, the Veterans Court's decision, which relies on Andrews to deny Mr. Arellano an earlier effective date under § 5110(b)(1), is affirmed.

Judge Dyk and five of our colleagues, however, would overturn Andrews and conclude that § 5110(b)(1) is a statute of limitations entitled to Irwin ’s presumption. But their basis for affirming the Veterans Court's decision rests on deciding, in the first instance, that the facts of Mr. Arellano's case do not warrant equitable tolling. We disagree with this approach both in substance and process. Even if Irwin ’s presumption were to somehow apply here, it would be rebutted by the statutory text of § 5110, which evinces clear intent from Congress to foreclose equitable tolling of § 5110(b)(1) ’s one-year period. Moreover, it is not our role as an appellate court to decide whether Mr. Arellano's factual circumstances warrant equitable tolling where no prior tribunal has considered the issue and no party has argued for such an outcome.

BACKGROUND

A

Congress has provided by statute for the payment of monetary benefits to veterans with disabilities arising from service. 38 U.S.C. § 1110. To obtain disability compensation, veterans must first file a claim with the VA. 38 U.S.C. § 5101(a)(1). With certain limited exceptions not relevant here, no compensation may be paid before such a claim is filed. Id . (with exceptions not applicable here, a "claim ... must be filed in order for benefits to be paid or furnished to any individual under the laws administered by the Secretary"). The size of a veteran's disability compensation award is determined, in part, by the effective date assigned to his award—i.e., the date on which benefits begin to accrue. An earlier effective date means a greater accrual of benefits.

Section 5110 of Title 38 governs the effective date of VA benefits awards. Two of its provisions are at issue in this appeal. First, § 5110(a)(1) sets forth the default rule that the effective date of an award cannot be earlier than the date the VA receives the veteran's application submitting a claim for that award:

Unless specifically provided otherwise in this chapter, the effective date of an award based on an initial claim, or a supplemental claim, of compensation, dependency and indemnity compensation, or pension, shall be fixed in accordance with the facts found, but shall not be earlier than the date of receipt of application therefor.

§ 5110(a)(1).¹ Accordingly, the natural consequence of § 5110(a)(1) ’s default rule is that no disability compensation is payable for periods predating the VA's receipt of the application for benefits, "[u]nless specifically provided otherwise" by statute.

Section 5110 sets forth several exceptions to § 5110(a)(1) ’s default rule, each providing for a retroactive effective date—that is, an effective date earlier than the date VA received the application—which, in turn, leads to a greater benefits award than under the default rule. See § 5110(b) – (n). Many of § 5110 ’s exceptions pertain to specific circumstances that may delay the filing of an application for benefits. These include: discharge from the military, § 5110(b)(1) ; increase in the severity of a disability, § 5110(b)(3) ; the "permanent[ ] and total[ ] disab[ility]" of a veteran, § 5110(b)(4) ; death of a spouse, § 5110(d) ; and correction of military records, § 5110(i). Each of § 5110 ’s enumerated exceptions, however, expressly limits the retroactivity of the effective date to one year. See , e.g. , § 5110(g) ("In no event shall [an] award or increase [under this paragraph] be retroactive for more than one year from the date of application therefor ....").

As relevant here, one of those enumerated exceptions— § 5110(b)(1) —provides that a disability compensation award's effective date may date back to the day after a veteran's discharge if the application for such benefits is received within one year after discharge:

The effective date of an award of disability compensation to a veteran shall be the day following the date of the veteran's discharge or release if application therefor is received within one year from such date of discharge or release.

§ 5110(b)(1).

On the face of the statute, then, the effective date for awards based on applications received more than one year after discharge (that do not otherwise fall within any of § 5110 ’s other enumerated exceptions) "shall not be earlier than the date of receipt of application therefor." § 5110(a)(1). This appeal considers whether equitable tolling may apply to § 5110(b)(1) ’s one-year period to permit an effective date reaching back to the day after the veteran's discharge from service, even though the application for that award was received more than one year after discharge.

The equitable-tolling doctrine, as traditionally understood, "permits a court to pause a...