Hanlin v. Nicholson — Attorney fees require a fee agreement with the claimant whose benefits are at issue

After the veteran’s death, his widow pursued DIC and later obtained a favorable § 1151-based award, from which VA paid her attorney a direct fee under a fee agreement she had signed. Years later, the veteran’s adult son was separately awarded helpless-child DIC under 38 U.S.C. § 1314(b), and VA withheld 20% of his past-due benefits for the same attorney. The Board and the Veterans Court denied the fee request as to the son’s award, and the Federal Circuit affirmed.

The court held that 38 U.S.C. § 5904 permits direct payment of attorney fees only when there is a fee agreement between the attorney and the claimant whose benefits are being withheld. Even assuming the attorney’s interpretation of “claim” could be accepted, the absence of any fee agreement with the adult child was dispositive. The court also rejected the theory that the widow’s agreement could bind the adult child, explaining that nothing in §§ 1311 or 1314 authorizes a parent to contract for attorney fees on behalf of an adult child, and the record did not establish any agency or authority to do so. The decision reinforces that fee entitlement is claimant-specific and cannot be expanded simply because multiple beneficiaries arise from the same family-based DIC context.

Direct payment of attorney fees under 38 U.S.C. § 5904 requires a valid fee agreement between the attorney and the particular claimant whose past-due benefits are used to pay the fee; one claimant’s fee agreement does not authorize withholding from another claimant’s separate award.

Fee agreements must be executed with each claimant whose benefits may be subject to direct attorney-fee withholding. A surviving spouse’s agreement does not automatically extend to an adult child’s separate DIC award.

Hanlin prevents attorneys from treating related survivors’ benefits as a single fee pool without claimant-specific authorization. It is especially important in DIC and helpless-child cases, where different beneficiaries may have distinct entitlements even though they arise from the same veteran’s death.

Improper Application of Regulation

A representative signs a 20% fee agreement with a surviving spouse in a DIC appeal, then later VA awards separate past-due helpless-child benefits to an adult child. The attorney seeks direct payment from the child’s award, but there is no agreement with that child.

Use Hanlin to oppose direct payment of attorney fees from a beneficiary’s award when the representative lacks a fee agreement with that specific claimant. It also helps frame disputes over whether multiple survivors constitute separate claimants for fee purposes.