The Department of Veterans Affairs (VA) has emailed the following notice to all accredited attorneys and agents.  The notice identifies what the VA calls “recurring problems” with fee agreements between accredited attorneys and agents and the veterans they serve.

US Department of Veterans Affairs

VA Accreditation: Topics of Interest

Hello!  This is the first email of a series that will discuss current topics relevant to your accreditation with the Department of Veterans Affairs (VA).  These emails are being sent to all VA accredited attorneys and claims agents.  They are intended to help the newer VA-accredited attorneys and claims agents gain familiarity with statutes and regulations that govern VA accreditation, and to provide helpful reminders to those attorneys and claims agents with more experience.  This post concentrates on reoccurring problems that we have spotted with fee agreements.

• Mixed Type Fee Agreements.  Fees may be based on a fixed fee, hourly rate, a percentage of benefits recovered, or a combination of such bases.  38 C.F.R. § 14.636(e).  But, in order to receive direct payment of a fee by VA, the fee must be wholly contingent on favorable resolution of the claim.  38 C.F.R. § 14.636(h)(1)(ii).  Thus, please be aware that VA will not provide direct payment for any fee agreements that mixes a contingent fee with a fixed or hourly rate.

• “Exclusive Contact” Clauses in a Fee Agreement.  We have noticed a number of fee agreements that purport to restrict VA from contacting a veteran.  But a fee agreement is between a client and representative; it does not bind VA and cannot restrict VA from contacting a veteran.  Equal Employment Opportunity Comm’n v. Waffle House, Inc., 534 U.S. 279, 294 (2002) (“It goes without saying that a contract cannot bind a nonparty.”).  Please make sure that you are using the fee agreement for its intended purpose.

• Restricting Clients Right to Dispute Fees.  We have also seen fee agreements that purport to restrict a client’s right to dispute an attorney fee or communicate directly with VA on a matter related to fees.  Veterans, however, have a legal right to dispute an attorney’s eligibility to a fee or question the reasonableness of a fee agreement.  38 C.F.R. § 14.636(i).  In short, such a clause in a fee agreement is invalid and will not be honored.  Continual placement of such a clause in a fee agreement may amount to a misleading of or misrepresentation to the client, a violation of VA’s standards of conduct that could warrant termination of one’s accreditation.  See 38 C.F.R. §§ 14.632(c)(3), (8), 14.633.

For additional information concerning VA compensation and pension benefits, visit:

VA Compensation and Pension Benefits