The “Splendid Isolation” and the Evolution of Veterans Law

The aforementioned platypus of American veterans law evolved during two centuries in which decisions on benefits were walled off from judicial review — a time period that the Supreme Court has referred to as a “splendid isolation.”  Brown v. Gardner, 513 U.S. 115 (1994).  So how did veterans law become singularly isolated from the development of the American judiciary?

Quick constitutional law quiz:  Which case established the power of the federal courts to declare acts of Congress unconstitutional?  First year law students are taught that the answer is Marbury v. Madison, but take a close look at Marbury.  What it actually says is:  “It must be well recollected that in 1792, an act passed, directing the secretary at war to place on the pension list such disabled officers and soldiers as should be reported to him by the circuit courts, which act, so far as the duty was imposed on the courts, was deemed unconstitutional . . . .”  Marbury itself, therefore, reminds the reader that the case is not the first time that a statute was declared unconstitutional.  In fact, more than a decade earlier, the first veterans benefits adjudication system was declared unconstitutional in Hayburn’s Case, 2 U.S. (2 Dall.) 408 (1792). 

The essential problem with the original veterans benefits system was that the Invalid Pension Act of 1792 required the courts to decide claims for disability pensions, but also gave the Secretary of War the authority to ignore any decision of the courts with which he disagreed.  This was deemed unconstitutional because it required the federal courts to issue advisory opinions.  (Perhaps not by coincidence, fewer than five months after the Invalid Pension Act attempted to assign veterans’ cases to the federal courts, the justices of the Supreme Court submitted a “memorial” to Congress stating that the tasks assigned to the judiciary were “too burdensome” for “the small number of judges.”)  Congress reacted, in simple terms, by simply taking the ball and going home.  It repealed the statute and simply gave the Secretary of War the duty of deciding all pension claims without the supervision of the courts.  Accordingly, the “splendid isolation” was not a policy decision based upon a determination about veterans benefits, but rather a separation-of-powers fight that, by historical accident, set the system on a path that it would follow until 1988.

Of course, there were some twists and turns along the way.  The U.S. Court of Claims was established in 1855, and disappointed Civil War claimants attempted to press their claims there after the war.  However, the Supreme Court rejected those attempts on the grounds that veterans did not have any cognizable property right:  “No pensioner has a vested legal right to his pension.  Pensions are the bounties of the government, which [C]ongress has the right to give, withhold, distribute, or recall, at its discretion.”  U.S. ex rel. Burnett v. Teller, 107 U.S. 64 (1883).  This may seem harsh, but it is quite understandable in context.  Ward Burnett was a veteran who had used his congressional connections to obtain a special pension at a higher rate.  He eventually decided he should be able to collect both a regular pension and his special pension, and was suing to get both when he was brushed off by the Supreme Court.

In fact, Civil War pensions were highly political.  In some sessions, half the legislation introduced in Congress consisted of special pensions for disappointed constituents and friends of politicians.  During the first session of the forty-ninth Congress alone, 4,500 special pension acts were introduced in Congress, and in the late 1880s, Grover Cleveland signed 1,453 such bills.  Moreover, legions of special pension examiners were sent to important districts to swing close elections by granting massive quantities of claims before election day.  Colonel W.W. Dudley, the head of the Pension Bureau, spent two months in Ohio with a staff of clerks and examiners not only campaigning for his Republican party, but specifically working to defeat William Warner, the Democratic chairman of the House Committee on Pensions, Bounty, and Back Pay, who had resisted some demands of the Grand Army of the Republic, the leading organization of Civil War veterans.

The Civil War pension system also had a reputation for being corrupt as well as politicized.  Shady claims agencies engaged in a wide variety of illegal practices to have claims granted, ranging from obtaining fraudulent evidence to planting their own employees inside the Pension Bureau.  In 1872, the Secretary of the Interior estimated that a quarter of all pension payments were based upon fraudulent claims.  The reaction to this corruption was a strict limit of only $10 on how much could be charged to assist with a veterans benefits claim.  The limit did not solve the corruption problem, but had an entirely different effect.  It stayed on the books well into the twentieth century.  By the time WWI veterans were returning, attorneys would not handle veterans claims because of the negligible fee.

The next chapter in the splendid isolation was written in 1933, when Section 5 of FDR’s Economy Act explicitly exempted veterans claims from judicial review.  Although FDR was certainly a liberal who engineered much of the modern welfare state, the New Deal was paid for by slashing $400 million for the veterans benefits budget.  FDR did not want the courts undermining his ability to pay for other priorities, so he added Section 5 to ensure this.

After the Vietnam War, the Supreme Court began to open the doors to the federal courts slightly by holding that class action lawsuits could be used to challenge aspects of the system as unconstitutional.  However, the Court rejected due process challenges to the central features of the system, such as the $10 attorney fee limit at issue in Walters v. National Association of Radiation Survivors, 473 U.S. 305 (1985).

The Vietnam veterans fought hard for judicial review in the hopes that the federal courts would assist them with their other issues.  They were opposed by the established Veterans Service Organizations (VSOs), who were quite happy with their influence over the system.  (The political term “Iron Triangle” was invented to describe the tight relationship between VA, the VSOs, and the congressional veterans affairs committee staffs.)  However, after many years of losing battles, Vietnam Veterans of America finally outmaneuvered the established VSOs in 1988 by helping to engineer the passage of the Veterans Judicial Review Act (VJRA).

The VJRA created an Article I court now called the Court of Appeals for Veterans Claims (CAVC) to review final decisions by VA.  The Act also provided that pure questions of law (but not factual issues or the application of the law to the facts) could be appealed from the CAVC to the Federal Circuit.  The CAVC operates as a traditional appellate court that reviews VA decisions based upon a closed record after briefing and sometimes oral argument.  The court published its first decision at the beginning of 1990, and four of its decisions since then have made it all the way to the Supreme Court.

Questions to explore:  Some VSOs have argued in cert petitions that the Federal Circuit owes special deference to CAVC rulings on veterans law due to the lower court’s expertise.  (Several years ago there was a similar active debate about the deference owed the Tax Court.)  What is the proper way for generalist courts to view the role of a specialized Article I appellate court?  In Shinseki v. Sanders, 556 U.S. 396 (2009), the Supreme Court sided with the CAVC over the Federal Circuit, and commented that “[i]t is the Veterans Court, not the Federal Circuit, that sees sufficient case-specific raw material in veterans’ cases to enable it to make empirically based, nonbinding generalizations about [which errors are prejudicial].”  Is that consistent with how other Article I courts are viewed?