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Updated Jul 23, 2024

In This Section
This section contains the following topics:
Topic
Topic Name
1
2
3
4
5

1.  Preparing an Administrative Decision and Notifying Claimants

Introduction
This topic contains information on preparing an administrative decision and notifying claimants, including

Change Date
July 23, 2024

VI.iii.3.C.1.a.  When to Prepare an Administrative Decision
Make an administrative decision after completely developing the facts associated with a contested claim.
Exception:  Document decisions on apportionment claims in accordance with the instructions in M21-1, Part VII, Subpart iii, 1.A.3.
Reference:  For more information on preparing an administrative decision, see M21-1, Part X, Subpart v, 1.C.3.

VI.iii.3.C.1.b.  Responsibility for Approving Administrative Decisions
Veterans Service Center Managers and Pension Management Center Managers or their designated reviewers are responsible for approving all administrative decisions regarding a contested claim.

VI.iii.3.C.1.c.  Actions to Take When One Claimant Establishes Entitlement
If one of the claimants in a contested claim establishes entitlement,
  • deny the claim of the other claimant(s), and
  • notify all claimants and other interested persons of the actions taken.
Note:  Attach VA Form 20-0998, Your Right to Seek Review of Our Decision, to the decision notice.

 2.  Deferring Award Action and Notifying Successful Claimants

Introduction
This topic contains information on

Change Date
February 25, 2019

VI.iii.3.C.2.a.  Deferring Award Action on a Contested Claim
To allow an unsuccessful claimant an opportunity to initiate an appeal to the Board of Veterans’ Appeals (BVA), and to provide for due process procedures in cases of running awards, defer award action for 60 days on a contested claim.
Exceptions:  When an apportionment claim is
  • denied, restore all funds in withholding to the primary beneficiary, or
  • granted, release the apportioned benefits to the claimant without waiting for the 60-day appeal period to expire.
References:  For more information on

VI.iii.3.C.2.b.  Sending Notice to a Successful Claimant
Furnish notice containing the following paragraphs to the successful claimant in a contested claim.
We have determined that you are entitled to [type of benefit] as the Veteran’s [relationship to the Veteran].  [relevant regulation(s)]
We considered the following evidence in our decision:  [evidence considered].
We cannot release payments to you at this time because [name of other claimant] has also applied for this benefit and has the right to initiate an appeal by filing a notice of disagreement with our disallowance within 60 days from this date.
If notice of disagreement is not filed by [name of other claimant] within 60 days, we will take appropriate award action.  We will notify you if a notice of disagreement is filed.
The attached VA Form 20-0998 describes your right to appeal our decision.
Notes:
  • Attach VA Form 20-0998 to the decision notice.
  • BVA notifies the successful claimant if the unsuccessful claimant files a notice of disagreement.

3.  Notifying Unsuccessful Claimants

Change Date
February 25, 2019

VI.iii.3.C.3.a.  Notifying Unsuccessful Claimants
Furnish a notice containing the following paragraphs to unsuccessful claimants in a contested claim.
Your claim for [type of benefit] as the Veteran’s [relationship to the Veteran] has been denied because [reason(s) for the denial].  [relevant regulation(s)]
We considered the following evidence in our decision:  [evidence considered].
We have determined that [name of successful claimant] is entitled to [type of benefit].  Payment will be withheld, however, for a period of 60 days from the date of this letter to provide you an opportunity to file a notice of disagreement with our decision.
The attached VA Form 20-0998 describes your right to appeal our decision.
Note:  Attach VA Form 20-0998 to the decision notice.

4.  Actions to Take After Issuing Notice of a Decision on a Contested Claim

Introduction
This topic describes the actions to take after issuing notice of a decision on a contested claim, including

Change Date
July 23, 2024

VI.iii.3.C.4.a.  Action to Take if an Unsuccessful Claimant Fails to Respond to the Decision Notice
If an unsuccessful claimant fails to submit a notice of disagreement within 60 days of the date of the notice described in M21-1, Part VI, Subpart iii, 3.C.3.a, pay benefits to the successful claimant.

VI.iii.3.C.4.b.  Action to Take if VA Is Already Paying Benefits to a Party in a Contested Claim
In addition to the notices described in M21-1, Part VI, Subpart iii, 3.C.2 and 3, send notice of proposed adverse action to any current beneficiary whose benefits the Department of Veterans Affairs (VA) might adjust or discontinue as a result of a contested claim.
If, within 30 days of the date of the notice of proposed adverse action, the beneficiary requests a personal hearing, VA may not make a final decision until it conducts the hearing or the beneficiary fails, without good cause, to appear.
Reference:  For more information about preparing a notice of proposed adverse action, see M21-1, Part X, Subpart ii, 3.A.

VI.iii.3.C.4.c.  Reducing or Discontinuing a Running Award as a Result of a Contested Claim
If it becomes necessary to reduce or discontinue a running award based on the outcome of a contested claim,
  • reduce or discontinue the award effective the date in the LAST PAID DATE field on the CURRENT AND HISTORICAL AWARD INFORMATION page in the Veterans Benefits Management System (VBMS), per 38 CFR 3.500(f), and
  • award benefits to the successful claimant effective the date of entitlement.
Follow the instructions in 38 CFR 3.657 if the outcome of a contested claim results in the reduction or discontinuation of a running award to an individual (as a Veteran’s surviving spouse) because another individual has been established as the legal surviving spouse of the same Veteran.
References:  For more information on
  • awarding benefits in a contested claim involving a deemed-valid marriage, see VAOPGCPREC 1-1996, and
  • stopping an award as a result of a contested claim, see the VBMS Awards User Guide.

5.  Effect of an Insurance Interpleader on Death Claims

Change Date
July 5, 2015

VI.iii.3.C.5.a.  Effect of an Insurance Interpleader on Death Claims
If there is a dispute about the person(s) entitled to the payment of insurance benefits, refer the matter to Office of General Counsel (OGC).
OGC may file suit in the nature of a bill of interpleader action, which may be brought by VA in the name of the United States against all persons having, or claiming to have, any interest in the insurance, in order to determine the rights of the parties to the insurance proceeds.
Note:  If an insurance matter has been submitted to OGC for a bill of interpleader, do not, as a general rule, delay a final determination on a claim for Survivors Pension, compensation, Dependency and Indemnity Compensation, or accrued benefits pending the outcome of the submission to OGC.