date on which notice of the decision is mailed pursuant to section 7104(e) of this title.

“(2) An appellant shall file a notice of appeal under this section by delivering or mailing the notice to the Court.

"(3) A notice of appeal shall be deemed to be received by the Court as follows: "(A) On the date of receipt by the Court, if the notice is delivered.

"(B) On the date of the United States Postal Service postmark stamped on the cover in which the notice is posted, if the notice is mailed.

"(4) For a notice of appeal mailed to the Court to be deemed to be received under paragraph (3)(B) on a particular date, the United States Postal Service postmark on the cover in which the notice is posted must be legible. The Court shall determine the legibility of any such postmark and the Court's determination as to legibility shall be final and not subject to review by any other Court.".

(b) APPLICATION.-The amendment made by subsection (a) shall take effect on the date of the enactment of this Act and shall apply to notices of appeal that are delivered or mailed to the United States Court of Veterans Appeals on or after that date.

SEC. 4. CLARIFICATION OF PAYMENT OF ATTORNEY FEES UNDER CONTINGENT FEE AGREEMENTS.

Section 5904(d)(2)(A) of title 38, United States Code, is amended to read as follows:

"(A) A fee agreement referred to in paragraph (1) of this subsection is one under which the total amount of the fee payable to the attorney (i) is to be paid to the attorney by the Secretary directly from any past-due benefits awarded on the basis of the claim, and (ii) is contingent on whether or not the matter is resolved in a manner favorable to the claimant.”.

INTRODUCTION

On October 14, 1993, the Chairman of the Committee, Senator John D. Rockefeller IV, introduced S. 1546, the proposed "Court of Veterans Appeals Improvement Act of 1993," with the cosponsorship of Committee members Dennis DeConcini, Bob Graham, and Thomas A. Daschle. As introduced, S. 1546 would have (1) required that the appointment of an associate judge of the United States Court of Veterans Appeals to serve as the chief judge be subject to Senate confirmation; (2) required that the Court accept as timely filed a notice of appeal that is postmarked by the United States Postal Service within the 120-day statutory filing period; (3) modified the jurisdiction of the Court of Veterans Appeals to allow review of cases barred from review under current law; and (4) clarified that payment of attorney fees directly by the Department of Veterans Affairs (VA) is allowed only when the total amount of the fee is contingent upon the appellant prevailing.

COMMITTEE MEETING

The Committee met in open session, first on October 28, 1993, and, in a continuation of that meeting, on November 3, 1993, and voted unanimously by voice vote to report favorably S. 1546.

SUMMARY OF S. 1546 AS REPORTED

S. 1546 as reported (hereinafter referred to as the "Committee bill") includes amendments to title 38 and the Veterans' Judicial Review Act of 1988 (Public Law 100-687) which would:

1. Require that the appointment of an associate judge of the United States Court of Veterans Appeals to be chief judge be by and with the advice and consent of the Senate. (Section 2)

2. (a) Require that the Court accept as timely filed a notice of appeal that is mailed within the 120-day statutory filing period if it

bears a legible United States Postal Service postmark, and (b) provide that the Court's determination as to the legibility of a postmark is final and not subject to review by any other court. (Section

3)

3. Clarify that attorneys may receive payment for representation before the Court directly from VA out of a retroactive benefit award only if the total amount of the fee is contingent upon the claim being resolved in favor of the appellant. (Section 4)

DISCUSSION

The United States Court of Veterans Appeals was established under Article I of the Constitution with the enactment of the Veterans' Judicial Review Act of 1988 (VJRA) (Public Law 100-687). The Court is an appellate tribunal with exclusive jurisdiction to review, on the record of proceedings, decisions rendered by the Board of Veterans' Appeals (BVA), the highest adjudicatory body within the Department of Veterans Affairs. Prior to the establishment of the Court, the review of BVA decisions was prohibited.

The provisions of the Committee bill are designed to refine and to improve the VJRA. Sections 2 and 3 of S. 1546 as introduced were previously reported by the Committee and passed by the Senate as part of S. 2974 in the 102d Congress. S. 2974 was reported by the Committee on September 15, 1992, and passed by the Senate on October 1, 1992. Section 4 of the bill as introduced, which was also included in S. 2974, was deleted before the Committee considered the bill. Section 5 of S. 1546 as introduced is now section 4 of S. 1546 as reported.

CONFIRMATION OF CHIEF JUDGE

Section 2 of the Committee bill would clarify the process for filling a vacancy in the position of chief judge of the Court. Under current law, section 7254(d) of title 38, United States Code, when a vacancy occurs in the chief judge position, the associate judge senior in service assumes the role of "acting chief judge” unless the President designates another of the associate judges to serve in that capacity. That provision, added by Public Law 101-94, ensures that the responsibility for carrying out the functions of the chief judge is clearly set forth so as to avoid undue disruption if the chief judge position becomes vacant.

In recognition of the importance of the chief judge position of the Court, section 2 of the Committee bill would clarify that the President's appointment of any individual, including an associate judge of the Court, to be chief judge must be with the advice and consent of the Senate. Current law clearly requires that if the President appoints an individual not on the Court to be chief judge, that appointment would be subject to Senate confirmation. Also, under current law, the appointment of an individual to become an associate judge is clearly subject to Senate confirmation. However, current law does not directly indicate whether Senate confirmation is required again when the President appoints an associate judge to become the chief judge of the Court. The Committee believes that when an associate judge is nominated for the position of chief judge, the Senate should have the opportunity to review the quali

fications of the nominee as they specifically relate to the chief judge position.

The Committee notes that the chief judge of the Court, in addition to fulfilling his or her judicial responsibilities, is responsible for overseeing the administration of the Court's budget and personnel system and representing the Court in various public functions. Because of the special responsibilities and importance of the chief judge position, the Committee believes that the President's selection of any individual to be chief judge regardless of that individual's position at the time of his or her selection-warrants the Senate's exercise of its advice-and-consent responsibility. Therefore, section 2 of the Committee bill would require that the President's appointment of any individual to be chief judge be by and with the advice and consent of the Senate.

Cost: According to the Congressional Budget Office (CBO), enactment of section 2 of the Committee bill would entail no significant costs.

MAILING OF NOTICES OF APPEAL TO THE COURT OF VETERANS

APPEALS

Section 3 of the Committee bill would provide that an appeal to the Court is filed in a timely manner if it is postmarked as opposed to being actually received by the Court-within the 120-day statutory filing period. Under section 7266(a) of title 38, an appeal to the Court "must be filed within 120 days following the date on which the [Board of Veterans' Appeals] notice of decision is mailed.

"The Court has implemented this requirement by promulgating Rule 4 of the Court's Rules of Practice and Procedure, which requires that a notice of appeal must actually be received by the Court within that time limit in order to be timely filed. In a series of decisions, the Court has dismissed for lack of jurisdiction appeals that were mailed before, but received by the Court after, the 120day limit had expired. See, e.g., DiDonato v. Derwinski, 2 Vet.App. 42 (1991).

The Committee believes that the Court's implementation of the 120-day limit Congress established for filing appeals provides those who live closer to Washington, D.C., where the Court is located, more actual time to perfect their appeals than those living greater distances from the Court. The 120-day filing period begins on the date the Board of Veterans' Appeals notice of decision is mailed from Washington.

It is likely that a claimant in a state distant from Washington, D.C.-such as Arizona, Hawaii, or Alaska-not only would receive notice of a BVA decision after a claimant in a state near Washington, D.C.-such as Maryland, West Virginia, or North Carolinawhose notice was sent the same day, but also, under the Court's current rule, would need to mail the notice of appeal to the Court earlier in order to increase the likelihood of a timely filing of the notice of appeal. Moreover, the Court's "actual receipt" rule for filing purposes does not grant any lenience to an appellant who mailed a notice of appeal well before the 120th day but whose notice was delayed. The current rule also fails to acknowledge that such delays routinely occur due to no fault of the sender.

The Committee notes that Rule 4 of the Court's Rules of Practice and Procedure allows the filing of a notice of appeal by "facsimile or other printed electronic transmission." The Committee believes that the Court's acceptance of notices transmitted in that manner is a reasonable and practical approach that both appropriately recognizes a technology that is a part of everyday business life and provides for some veterans living far from Washington maximum time to perfect their appeals. Thus, under Rule 4, a veteran may timely file a notice of appeal with the Court as late as the 120th day by transmitting the notice by facsimile. However, a veteran who does not have access to a facsimile machine may suffer the consequence of a dismissal if a delay in mail delivery occurs-regardless of the date on which the notice was posted.

The Committee notes that the Tax Court, which, like the Court of Veterans Appeals, is an Article I court, recognizes the postmark date as the date of filing of a petition for redetermination of a deficiency by that Court pursuant to section 7502 of title 26, United States Code. Rule 13(b) of the Federal Rules of Appellate Procedure also provides that a notice of appeal for review of a Tax Court decision may be timely filed if mailed to the clerk of the Tax Court within the statutory filing period. Rule 4(a) of the Rules of the United States Court of Appeals for the Federal Circuit, which exercises appellate jurisdiction over the Court of Veterans Appeals, also permits the postmark date to be recognized as the date of filing a notice of appeal in some circumstances. In addition, the Court of International Trade has adopted a "postmark rule" (Court of International Trade Rule 5(e)), as has the United States Court of Military Appeals (Court of Military Appeals Rules of Practice and Procedure Rule 36).

The Committee further notes that section 4005(b)(1) of title 38, relating to the internal VA appellate process, provides that a “notice of disagreement postmarked before the expiration of the oneyear period for timely filing of such notices will be accepted as timely filed." Moreover, Rule 305 of the Board of Veterans' Appeals applies a "postmark rule" to the filing of substantive appeals.

The Committee believes that, as a practical matter, a "postmark rule" would both ease compliance with statutory filing requirements and avoid unfortunate dismissals of appeals that are mailed within a reasonable period of time prior of the expiration of the 120-day period but received by the Court after that date. The Court of Veterans Appeals' adoption of Rule 4 was clearly proper and within the scope of the Court's authority. However, the Committee believes that all potential appellants to the Court-regardless of how far from the Court they may reside, their access to facsimile machines, or the speed with which their mail is delivered-should have the date of posting, as indicated by the postmark on a notice of appeal, be considered the filing date. Thus, section 3 of the Committee bill would amend section 7266(a) of title 38 to require that a notice of appeal be deemed received by the Court on the date it is postmarked, if it is mailed. Only legible United States Postal Service postmarks would be sufficient. The Court's determination as to the legibility of a postmark would be final and not subject to review by any other court.

A notice of appeal is also considered timely filed if it is delivered to the Court within the 120-day limit established by Congress. Delivery, under section 7266(a) of title 38 of the United States Code, includes receipts from private mail, including meter strips which show.postmarks that are not United States Postal Service postmarks. "Delivery" also includes, but is not limited to, use of private courier or delivery services, and delivery in person by the appellant. If the notice of appeal is delivered rather than mailed to the Court, it must be received by the Court on or before the 120th day. Cost: According to CBO, the enactment of section 3 of the Committee bill would entail no significant costs.

CLARIFICATION OF PAYMENT OF ATTORNEY FEES UNDER CONTINGENT FEE AGREEMENTS

Section 4 of the Committee bill would overrule the Court of Veterans Appeals as to one element of its decision in Matter of Fee Agreement of Smith, 4 Vet.App. 487 (1993). Specifically, this provision relates to the issue of attorney fees paid directly to the attorney by VA from past-due benefits awarded to the appellant. Under current law, section 5904(d) of title 38, an attorney may receive payment for representation before the Court directly from VA out of a retroactive benefit award. However, for this provision to apply, two requirements must be met: First, the total fee may not exceed 20 percent of the total amount of any past-due benefits awarded to the appellant; and second, under the fee agreement, the fee must be contingent upon whether or not the claim is ultimately resolved in favor of the appellant. Section 4 would clarify that the statute allows payment only when the total amount of the fee is contingent upon the appellant prevailing.

Section 5904(d) was intended to provide the attorney with the benefit of receiving the fee for representation directly from VA out of any retroactive benefit award the appellant receives. However, the statute requires that any agreement calling for this direct payment must provide that the fee is to be paid on a contingency basis. If implementation of the provision works as it should, in a successful case, the attorney is assured of actually receiving payment of the fee, and relieved of having to confront any collection difficulties. The Committee currently is evaluating whether this provision is working effectively.

However, in the Smith case, the Court held that the statutory provision applied even though the fee agreement in that case required the appellant to pay a fixed fee and also provided that an amount would be paid directly by VA to the attorney out of any retroactive award the appellant might receive. Thus, the agreement did not provide for a true contingency fee, but rather a "hybrid" fee-a partially fixed, partially contingent fee. A true contingency fee agreement does not require payment of any fixed fee.

Section 4 would amend section 5904(d) to clarify that if a fee agreement requires direct payment from VA to the attorney, the total amount of the fee must be contingent upon whether or not the appellant's claim is successfully resolved.

Cost: According to CBO, the enactment of section 4 of the Committee bill would entail no significant costs.