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KAPOURELOS v. UNITED STATES

August 12, 1969

Anastasia KAPOURELOS
v.
UNITED STATES of America and William J. Driver, Administrator of Veterans Affairs



The opinion of the court was delivered by: LORD, JR.

 This case comes to the Court on plaintiff's motion for summary judgment and on defendants' motion to dismiss for lack of jurisdiction or in the alternative for failure to state a claim upon which relief can be granted, which can likewise be treated as a motion for summary judgment as provided by Rule 12(b), Fed.R.Civ.P. There is no genuine dispute as to any material fact.

 The basic facts here involved are as follows: In 1964, Congress adopted a Veterans Reopened Insurance Program for a period of just over one year from May 1, 1965 to May 3, 1966, by enactment of a new section to the National Service Life Insurance Act, Section 725 of Title 38, United States Code. Tolly G. Kapourelos, a veteran of World War II, whose originally issued insurance had lapsed for nonpayment of premiums filed an application on April 27, 1965 for $10,000 life insurance under Section 725 within the required period of time. He also paid the required premiums.

 The Veterans Administration Center, Philadephia, Pennsylvania, received the application, assigned a life insurance policy number thereto and accepted payment of premiums for the months of May and June, 1965. On July 2, 1965, the insured died while a patient in the Veterans Administration Hospital, Coatesville, Pennsylvania. The cause of death, as confirmed by autopsy, was chronic bronchitis, emphysema, and fibrosis of the lungs, non-service connected disabilities from which the veteran had suffered for several years. The plaintiff in this case, Anastasia Kapourelos, is the mother of the veteran and the beneficiary named in his application for insurance. Her written demand for the proceeds of the insurance was rejected and her claim disallowed. She then filed a Notice of Disagreement. The Statement of the Case furnished to the plaintiff for the purposes of her appeal to the Administrator of Veterans Affairs gave as the reason for rejection of her claim, that:

 
"Veteran did not have any National Service Life Insurance in force at time of his death."

 The Board of Veterans Appeals, which is the final administrative agency for appeal, found as part of its findings of fact that:

 
"5. The application for insurance under Section 725 of 38 U.S.C. was not acted on prior to death.
 
"6. Subsequent to death, the application for insurance was rejected because he died within one-year period following the application from non-service connected causes, which were in existence at the time of the application."

 The reason for rejection referred to in "6." above is based upon a regulation of the Administrator of Veterans Affairs, discussed more fully below, which provides in effect that proceeds of the policy will not be paid where the insured dies within one year of the date of application from a non-service connected disability in existence at the time of the application. (38 C.F.R. 8.112a(c)). Reliance on this regulation was also the basis of the decision of the Board of Veterans Appeals, as is evident from the latter's Conclusions of law, which follow:

 
"CONCLUSIONS OF LAW"
 
"1. The veteran was entitled to issuance of a policy of $10,000 National Service Life Insurance under the provisions of 38 U.S.C. 725 because of uninsurability.
 
"2. If the policy had been issued, payment could not properly be authorized because he died within one year of date of application from non-service connected disability in existence on date of application. (38 C.F.R. 8.112a(c))."

 Subsequent to final administrative determination by the Board of Veterans Appeals, the present plaintiff filed her Original Complaint in this case, which invoked the jurisdiction of this Court pursuant to 38 U.S.C. § 784. Defendants then moved to dismiss for lack of jurisdiction. Plaintiff then amended her complaint so as to rely on additional grounds for jurisdiction, namely the recently amended mandamus provision and related venue provisions as well as certain other provisions not discussed further here. 38 U.S.C.A. § 785, 28 U.S.C.A. § 1346(a)(2), 28 U.S.C.A. § 1361, 28 U.S.C.A. § 1391(e), and 5 U.S.C.A. § 701. Pursuant to the amended mandamus and venue provisions, the Administrator of Veterans Affairs was added as a party defendant.

 The Government now requests this Court to dismiss this action on the ground of lack of jurisdiction on the basis that this case does not involve a claim arising "under contract of National Service Life Insurance" and therefore not one for which jurisdiction is conferred by 38 U.S.C.A. Alternatively, the Government requests the Court to dismiss this case for failure to state a claim upon which relief can be granted, on the grounds that the Veteran applied under the wrong subsection of 38 U.S.C.A. § 725 and therefore had no effective insurance and that, even if he had ...


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