A-22252, APRIL 7, 1928, 7 COMP. GEN. 635

A-22252: Apr 7, 1928

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VETERANS' BUREAU - INSURANCE - REINSTATEMENT ALTHOUGH THE DIRECTOR OF THE VETERANS' BUREAU HAS PROMULGATED REGULATIONS PROVIDING WHAT PROOF WILL BE SATISFACTORY TO HIM TO MEET CERTAIN CONDITIONS PRECEDENT FIXED BY SECTION 304 OF THE WORLD WAR VETERANS' ACT TO AUTHORIZE REINSTATEMENT OF LAPSED OR CANCELED TERM INSURANCE. THE DIRECTOR MAY DETERMINE IN INDIVIDUAL CASES THAT THERE IS OF RECORD SUFFICIENT "PROOF SATISFACTORY TO THE DIRECTOR" TO SHOW THAT THE CONDITIONS OF THE STATUTE HAVE BEEN MET. UPON THE INSURANCE FEATURES OF WHICH YOUR DECISION IS REQUESTED. WHILE IN THE MILITARY SERVICE THE ABOVE-NAMED VETERAN APPLIED FOR AND WAS GRANTED $10. 000 OF WAR-RISK TERM INSURANCE WHICH HE ALLOWED TO LAPSE AFTER HE WAS DISCHARGED FROM THE SERVICE FOR NONPAYMENT OF PREMIUMS.

A-22252, APRIL 7, 1928, 7 COMP. GEN. 635

VETERANS' BUREAU - INSURANCE - REINSTATEMENT ALTHOUGH THE DIRECTOR OF THE VETERANS' BUREAU HAS PROMULGATED REGULATIONS PROVIDING WHAT PROOF WILL BE SATISFACTORY TO HIM TO MEET CERTAIN CONDITIONS PRECEDENT FIXED BY SECTION 304 OF THE WORLD WAR VETERANS' ACT TO AUTHORIZE REINSTATEMENT OF LAPSED OR CANCELED TERM INSURANCE, IN THE ABSENCE OF A REQUIREMENT IN THE STATUTE THAT THE NATURE OF ACCEPTABLE PROOF SHALL BE FIXED BY REGULATION, THE DIRECTOR MAY DETERMINE IN INDIVIDUAL CASES THAT THERE IS OF RECORD SUFFICIENT "PROOF SATISFACTORY TO THE DIRECTOR" TO SHOW THAT THE CONDITIONS OF THE STATUTE HAVE BEEN MET, NOTWITHSTANDING THE NONCOMPLIANCE WITH SOME OF THE REQUIREMENTS OF THE REGULATIONS.

COMPTROLLER GENERAL MCCARL TO THE DIRECTOR, UNITED STATES VETERANS' BUREAU, APRIL 7, 1928:

THERE HAS BEEN RECEIVED YOUR LETTER OF MARCH 24, 1928, AS FOLLOWS:

THE UNITED STATES VETERANS' BUREAU HAS BEFORE IT AT THE PRESENT TIME FOR DETERMINATION THE CASE OF FRED W. BYRD, XC-254, 732, UPON THE INSURANCE FEATURES OF WHICH YOUR DECISION IS REQUESTED.

WHILE IN THE MILITARY SERVICE THE ABOVE-NAMED VETERAN APPLIED FOR AND WAS GRANTED $10,000 OF WAR-RISK TERM INSURANCE WHICH HE ALLOWED TO LAPSE AFTER HE WAS DISCHARGED FROM THE SERVICE FOR NONPAYMENT OF PREMIUMS. ON JULY 1, 1927, THE VETERAN SUBMITTED AN APPLICATION FOR THE REINSTATEMENT OF HIS TERM INSURANCE AND ITS CONVERSION INTO UNITED STATES GOVERNMENT LIFE INSURANCE, TENDERING THEREWITH THE AMOUNT OF THE PREMIUM ON THE TERM INSURANCE FOR ONE MONTH. HE ALSO SUBMITTED AN UNSIGNED AND UNVERIFIED BUREAU FORM 763 DATED JUNE 30, 1927, WHICH FORM IS AN AFFIDAVIT IN SUPPORT OF REQUEST FOR REINSTATEMENT OF YEARLY RENEWABLE TERM (WAR TIME) INSURANCE WITH LIEN FOR PREMIUMS AND INTEREST UNDER SECTION 304 OF THE WORLD WAR VETERANS' ACT AS AMENDED JULY 2, 1926. THIS FORM HAD THE VETERAN'S NAME WRITTEN AT THE TOP AND INCLUDED UPON ITS FACE THE NECESSARY INFORMATION. THE PHYSICAL EXAMINATION REPORT IN CONNECTION WITH THE APPLICATION FOR REINSTATEMENT WAS NOT ACCOMPLISHED, BUT THERE ACCOMPANIED THE APPLICATION A LETTER FROM THE APPLICANT DATED JUNE 30, 1927, IN WHICH HE WROTE: "OWING TO MY INABILITY TO APPEAR BEFORE YOU FOR EXAMINATION, WILL YOU ACCEPT THE EXAMINATION I HAD IN YOUR OFFICE IN APRIL OF THIS YEAR?

ON JULY 19, 1927, BEFORE THE BUREAU HAD ACTED UPON THE APPLICATION FOR REINSTATEMENT, THE APPLICANT WAS RUN OVER BY AN ELECTRIC TRAIN AND KILLED.

AT THE DATE OF HIS APPLICATION FOR REINSTATEMENT THE VETERAN WAS SUFFERING FROM A COMPENSABLE DISABILITY RESULTING FROM TUBERCULOSIS BECAUSE OF WHICH PRIOR TO THE DATE OF HIS APPLICATION FOR REINSTATEMENT OF HIS TERM INSURANCE HE HAD BEEN RATED AS TEMPORARY PARTIAL 75 PERCENT FROM APRIL 28, 1927, AND HIS PRESENT FINAL RATINGS IS THE SAME, NAMELY, TEMPORARY PARTIAL 75 PERCENT TO THE DATE OF HIS DEATH, HIS DEATH HAVING RESULTED FROM ACCIDENTAL INJURIES WHICH WERE NOT SERVICE CONNECTED. THEREFORE, SINCE AT THE TIME OF HIS APPLICATION FOR REINSTATEMENT HE WAS NOT PERMANENTLY AND TOTALLY DISABLED, THE REINSTATEMENT OF HIS INSURANCE WOULD BE ALLOWABLE PURSUANT TO THE PROVISIONS OF SECTION 304 OF THE WORLD WAR VETERANS' ACT AS AMENDED, IF THE OTHER REQUISITE CONDITIONS ARE CONSIDERED AS MET. SECTION 304 OF THE WORLD WAR VETERANS' ACT, AS AMENDED JULY 2, 1926, IS AS FOLLOWS:

"IN THE EVENT THAT ALL PROVISIONS OF THE RULES AND REGULATIONS OTHER THAN THE REQUIREMENTS AS TO THE PHYSICAL CONDITION OF THE APPLICANT FOR INSURANCE HAVE BEEN COMPLIED WITH AN APPLICATION FOR REINSTATEMENT, IN WHOLE OR IN PART, OF LAPSED OR CANCELED YEARLY RENEWABLE TERM INSURANCE OR UNITED STATES GOVERNMENT LIFE INSURANCE (CONVERTED INSURANCE) HEREAFTER MADE MAY BE APPROVED IF MADE WITHIN ONE YEAR AFTER THE PASSAGE OF THIS AMENDATORY ACT OR WITHIN TWO YEARS AFTER THE DATE OF LAPSE OR CANCELLATION: PROVIDED, THAT THE APPLICANT'S DISABILITY IS THE RESULT OF AN INJURY OR DISEASE, OR OF AN AGGRAVATION, THEREOF, SUFFERED OR CONTRACTED IN THE ACTIVE MILITARY OR NAVAL SERVICE DURING THE WORLD WAR: PROVIDED FURTHER, THAT THE APPLICANT DURING HIS LIFETIME SUBMITS PROOF SATISFACTORY TO THE DIRECTOR SHOWING THAT HE IS NOT TOTALLY AND PERMANENTLY DISABLED. AS A CONDITION, HOWEVER, TO THE ACCEPTANCE OF AN APPLICATION FOR THE REINSTATEMENT OF LAPSED OR CANCELED YEARLY RENEWABLE TERM INSURANCE, WHERE THE REQUIREMENTS AS TO THE PHYSICAL CONDITION OF THE APPLICANT HAVE NOT BEEN COMPLIED WITH, OR, FOR THE REINSTATEMENT OF THE UNITED STATES GOVERNMENT LIFE INSURANCE (CONVERTED INSURANCE), THE APPLICANT SHALL BE REQUIRED TO PAY ALL THE BACK MONTHLY PREMIUMS WHICH WOULD HAVE BECOME PAYABLE IF SUCH INSURANCE HAD NOT LAPSED, TOGETHER WITH INTEREST AT THE RATE OF 5 PERCENTUM PER ANNUM, COMPOUNDED ANNUALLY, ON EACH PREMIUM FROM THE DATE SAID PREMIUM IS DUE BY THE TERMS OF THE POLICY: PROVIDED FURTHER, THAT WHERE WITHIN ONE YEAR OF THIS AMENDATORY ACT ALL OF THE REQUIREMENTS FOR REINSTATEMENT OF YEARLY RENEWABLE TERM INSURANCE UNDER THIS SECTION ARE COMPLIED WITH, EXCEPT THE PAYMENT OF UNPAID PREMIUMS WITH INTEREST, AND PROOF SATISFACTORY TO THE DIRECTOR IS FURNISHED SHOWING THE APPLICANT IS UNABLE TO PAY SUCH PREMIUMS WITH INTEREST OR SOME PART THEREOF, THE APPLICATION MAY BE APPROVED, AND THE AMOUNT OF UNPAID PREMIUMS WITH INTEREST AS PROVIDED IN THIS SECTION SHALL BE PLACED AS AN INTEREST-BEARING INDEBTEDNESS AGAINST THE INSURANCE, SUCH INDEBTEDNESS TO BEAR INTEREST AT THE RATE OF 5 PERCENTUM PER ANNUM, COMPOUNDED ANNUALLY, TO BE DEDUCTED IN ANY SETTLEMENT THEREUNDER: AND PROVIDED FURTHER, THAT NO YEARLY RENEWABLE TERM INSURANCE SHALL BE REINSTATED AFTER JULY 2, 1927.'

PARAGRAPH 2 OF GENERAL ORDER NO. 362 ISSUED BY THE UNITED STATES VETERANS' BUREAU, WHICH GENERAL ORDER RELATES TO THE REINSTATEMENT OF YEARLY RENEWABLE TERM INSURANCE UNDER THE PROVISIONS OF SECTION 304 OF THE WORLD WAR VETERANS' ACT AS AMENDED JULY 2, 1926, IS AS FOLLOWS:

"IF THE APPLICANT IS UNABLE TO PAY ALL OR ANY PART OF THE BACK MONTHLY PREMIUMS WITH INTEREST AND WILL FURNISH PROOF SATISFACTORY TO THE DIRECTOR OF HIS INABILITY TO PAY, THE AMOUNT OF SUCH PREMIUMS AND INTEREST WILL BE PLACED AS AN INTEREST-BEARING INDEBTEDNESS AGAINST THE INSURANCE. THE APPLICANT MUST ALSO SUBMIT WITH HIS APPLICATION A REMITTANCE SUFFICIENT TO COVER THE PREMIUM FOR THE MONTH OF REINSTATEMENT, OR THE FIRST PREMIUM ON THE CONVERTED POLICY IF THE INSURANCE IS TO BE REINSTATED AND CONVERTED. FORM 763 WILL BE USED IN SUBMITTING PROOF OF INABILITY TO PAY PREMIUMS WITH INTEREST. THIS FORM MUST BE SWORN TO BEFORE A NOTARY PUBLIC OR OTHER OFFICIAL AUTHORIZED TO ADMINISTER OATHS AND PROVIDED WITH A SEAL.'

PARAGRAPH 4 OF GENERAL ORDER NO. 362 STATES AMONG OTHER THINGS THAT IT IS ESSENTIAL THAT ALL THE REQUIREMENTS OF SECTION 304 BE COMPLIED WITH BEFORE REINSTATEMENT OF THE INSURANCE CAN BECOME EFFECTIVE.

IT APPEARS FROM THE FILE AFTER A COMPLETE INVESTIGATION THAT AT THE TIME OF HIS DEATH AND AT THE DATE OF HIS APPLICATION FOR REINSTATEMENT OF HIS TERM INSURANCE, THE VETERAN WAS CONSIDERABLY IN DEBT AND WAS UNABLE TO DISCHARGE HIS OBLIGATIONS. THE PHYSICAL EXAMINATION WHICH THE VETERAN REQUESTED THE BUREAU TO ACCEPT IN LIEU OF A REPORT OF HIS PHYSICAL CONDITION AT THE DATE OF HIS APPLICATION FOR REINSTATEMENT WAS MADE ON APRIL 28, 1927, AND DID NOT DISCLOSE THAT THE VETERAN WAS AT THAT TIME PERMANENTLY AND TOTALLY DISABLED, BUT ON THE CONTRARY WAS USED AS THE BASIS FOR RATING THE VETERAN 75 PERCENT TEMPORARY PARTIAL FROM APRIL 28, 1927. MEDICAL AUTHORITIES OF THE BUREAU HAVE STATED THAT BECAUSE OF THE NATURE OF THE TUBERCULOSIS FROM WHICH THE VETERAN WAS SUFFERING, IT IS NOT PROBABLE THAT THERE WOULD HAVE BEEN MUCH CHANGE IN HIS CONDITION BETWEEN THE DATE OF THE SAID EXAMINATION, NAMELY, APRIL 28, 1927, AND THE DATE OF HIS APPLICATION FOR REINSTATEMENT OF HIS TERM INSURANCE, NAMELY, JULY 1, 1927.

AS TO THE UNSIGNED AND UNVERIFIED FORM 763, YOUR ATTENTION IS INVITED TO THE PROVISIONS OF SECTION 304 OF THE WORLD WAR VETERANS' ACT, AS AMENDED, TO THE EFFECT THAT THE PROOF AS TO THE VETERANS' INABILITY TO PAY THE PREMIUMS WITH INTEREST MUST BE SATISFACTORY TO THE DIRECTOR.

YOUR DECISION OF THE FOLLOWING QUESTIONS IS, THEREFORE, REQUESTED:

1. IN VIEW OF THE PROVISIONS OF GENERAL ORDER NO. 362, MAY THE DIRECTOR ACCEPT THE UNSIGNED AND UNVERIFIED FORM 763 AND THE STATEMENTS THEREIN CONTAINED TOGETHER WITH THE OTHER EVIDENCE IN FILE AS TO THE VETERAN'S INABILITY TO PAY THE UNPAID PREMIUMS AND INTEREST, FOR CONSIDERATION AS EVIDENCE OF SUCH INABILITY TO PAY?

2. IN VIEW OF THE RATING BASED ON THE PHYSICAL EXAMINATION OF THE VETERAN ON APRIL 28, 1927, AND IN VIEW OF THE OPINIONS OF THE MEDICAL OFFICERS OF THE BUREAU THAT THE VETERAN'S CONDITION WOULD NOT HAVE CHANGED TO ANY CONSIDERABLE DEGREE BETWEEN THE DATE OF SUCH EXAMINATION AND JULY 1, 1927, THE DATE OF THE VETERAN'S APPLICATION FOR REINSTATEMENT, MAY SUCH EXAMINATION AND OPINIONS BE ACCEPTED IN LIEU OF THE USUAL REQUIREMENT OF A PHYSICAL EXAMINATION AND REPORT THEREOF AT THE TIME OF THE APPLICATION FOR REINSTATEMENT?

SECTION 304 OF THE CONTROLLING STATUTE, QUOTED IN YOUR SUBMISSION, PRESCRIBES CERTAIN CONDITIONS PRECEDENT TO ACCEPTANCE OF AN APPLICATION FOR REINSTATEMENT OF INSURANCE. 7 COMP. GEN. 509, 510. THE TWO CONDITIONS PRECEDENT HERE FOR CONSIDERATION ARE (A) WHETHER THE INSURED, DURING HIS LIFETIME, SUBMITTED "PROOF SATISFACTORY TO THE DIRECTOR" SHOWING HE WAS NOT TOTALLY AND PERMANENTLY DISABLED, AND (B) WHETHER "PROOF SATISFACTORY TO THE DIRECTOR" HAS BEEN FURNISHED SHOWING THAT THE APPLICANT WAS UNABLE TO PAY THE AMOUNT OF BACK PREMIUMS WITH INTEREST REQUIRED BY THE STATUTE. THE NATURE OR FORM OF THE "PROOF SATISFACTORY TO THE DIRECTOR" IN EITHER INSTANCE IS NOT SPECIFICALLY FIXED BY THE STATUTE BUT IS EXPRESSLY LEFT BY THE STATUTE TO THE DETERMINATION OF THE DIRECTOR. IT IS UNDERSTOOD FROM YOUR SUBMISSION THAT IN EACH INSTANCE REGULATIONS HAVE BEEN PROMULGATED WHEREIN IS PROVIDED IN PLAIN TERMS THAT PROOF WILL BE SATISFACTORY TO THE DIRECTOR UNDER THE STATUTE AS TO THE EXISTENCE OF EACH OF THE TWO CONDITIONS PRECEDENT ABOVE PRESCRIBED.

AS TO (A) YOU STATE IN YOUR QUESTION 2 THAT THERE IS "USUALLY A REQUIREMENT OF A PHYSICAL EXAMINATION AND REPORT THEREOF AT THE TIME OF THE APPLICATION FOR REINSTATEMENT," AND IT IS UNDERSTOOD THAT THIS IS A MATTER OF REGULATION. THIS REQUIREMENT OF THE REGULATION DOES NOT APPEAR TO HAVE BEEN MET.

AS TO (B) THE REGULATION YOU QUOTE EXPRESSLY PROVIDES THAT FORM 763, PRESCRIBED AS A MEDIUM TO FURNISH THE EVIDENCE OR PROOF OF INABILITY TO PAY BACK PREMIUMS WITH INTEREST "MUST BE SWORN TO BEFORE A NOTARY PUBLIC OR OTHER OFFICIAL AUTHORIZED TO ADMINISTER OATHS AND PROVIDED WITH A SEAL.' COMPLIANCE WAS NOT HAD WITH THIS REQUIREMENT OF THE REGULATION.

IT WOULD APPEAR FROM YOUR SUBMISSION THAT ALL OF THE DETAILED REQUIREMENTS PRESCRIBED BY REGULATION FOR THE REINSTATEMENT OF INSURANCE UNDER SECTION 304 OF THE STATUTE WERE NOT COMPLIED WITH IN THIS CASE PRIOR TO THE DEATH OF THE INSURED. HOWEVER, IN EACH INSTANCE IT SEEMS THERE WAS SUBMITTED SOME PROOF TO THE EFFECT THAT THE CONDITIONS PRECEDENT PRESCRIBED BY THE STATUTE, TO ENTITLE A VETERAN TO REINSTATEMENT OF HIS INSURANCE, WERE PRESENT AT DATE OF APPLICATION FOR REINSTATEMENT AND PRIOR TO THE DEATH OF THE VETERAN. WHETHER SUCH PROOF IS SATISFACTORY TO THE DIRECTOR IS NOT FOR DETERMINATION BY THIS OFFICE. IT IS ASSUMED, HOWEVER, THAT THE QUESTION UPON WHICH DECISION IS REQUESTED IS AS TO WHETHER THE DIRECTOR MAY DETERMINE IN THIS PARTICULAR CASE THAT THERE IS OF RECORD SUFFICIENT "PROOF SATISFACTORY TO THE DIRECTOR" TO SHOW THAT THE CONDITIONS OF THE STATUTE HAVE BEEN MET, NOTWITHSTANDING THE NONCOMPLIANCE WITH SOME OF THE REQUIREMENTS OF THE REGULATIONS.

AS THE LAW DOES NOT REQUIRE OR PROVIDE THAT THE DIRECTOR SHALL PRESCRIBE REGULATIONS UNDER WHICH TO DETERMINE WHAT SHALL CONSTITUTE PROOF SATISFACTORY TO HIM, THE FACT THAT HE HAS PRESCRIBED REGULATIONS TO THE EFFECT THAT CERTAIN PROOF WILL BE REGARDED BY HIM AS SATISFACTORY DOES NOT PRECLUDE HIM FROM DETERMINING IN PARTICULAR CASES THAT OTHER PROOF IS SATISFACTORY TO HIM.

THEREFORE, IN ANSWER TO BOTH QUESTIONS 1 AND 2, YOU ARE ADVISED THAT IF THE DIRECTOR SHALL FIND AND CERTIFY THAT THE PROOF SUBMITTED IN THIS CASE IS SATISFACTORY TO HIM AS ESTABLISHING THAT ALL OF THE CONDITIONS PRECEDENT PRESCRIBED BY THE STATUTE HAVE BEEN MET, AND IF HE SHALL CONSIDER THE INSURANCE AS REINSTATED AND MAKE AN AWARD ACCORDINGLY, THIS OFFICE WILL INTERPOSE NO OBJECTION TO THE PAYMENT OF INSURANCE BENEFITS TO THOSE LAWFULLY ENTITLED, IN THE ABSENCE OF OTHER OBJECTION NOT DISCLOSED IN YOUR PRESENT SUBMISSION.