[Code of Federal Regulations]
[Title 38, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 38CFR12.5]

[Page 551-552]
 
            TITLE 38--PENSIONS, BONUSES, AND VETERANS' RELIEF
 
                CHAPTER I--DEPARTMENT OF VETERANS AFFAIRS
 
PART 12_DISPOSITION OF VETERAN'S PERSONAL FUNDS AND 
 
Sec. 12.5  Nondesignee cases.

    (a) If there exists no designee at the time of death at a hospital, 
domiciliary, or regional office of a veteran admitted as competent, or 
the designee fails or refuses to claim the funds and effects as defined 
in Sec. 12.0(a) within 90 days following the mailing of notice to such 
designee, the facility head will take appropriate action to dispose of 
the effects to the person or persons legally entitled thereto, i.e., the 
executor or administrator of the decedent, or, if no notice of such an 
appointment has been received, to the decedent's widow, child, 
grandchild, mother, father, grandmother, grandfather, brother, or 
sister, in the order named. Subject to the applicable provisions of 
Sec. Sec. 12.3 and 12.4, such delivery may be made at any time before 
the sale contemplated by Sec. 12.9 to the designee or other person 
entitled under the facts of the case. Delivery will be made to the 
person entitled to priority as prescribed in this paragraph, unless such 
person waives right to possession, in which event delivery will be to 
the person, if any, in whose favor such prior entitled person waives 
right to possession. If the waiver is not in favor of a particular 
person or class, delivery will be to the person or persons next in order 
of priority under this paragraph. If in any case there be more than one 
person in the class entitled to priority, initially or by reason of 
waiver, delivery will be made only to their joint designated agent (who 
may, but need not, be one of the class), or to one of such class in his 
or her own behalf upon written waiver of all others of the class 
entitled thereto. The guardian of

[[Page 552]]

a minor or incompetent may waive his or her ward's prior right to 
possession.
    (b) Except where delivery is made to a designee, executor, or 
administrator, funds of veterans who were competent at time of death 
will be released to the person or persons who would ultimately be 
entitled to distribution under the laws of the State of the decedent's 
domicile. The person or persons entitled may waive in writing his or her 
right to the funds in favor of another heir or next of kin.
    (c) Funds of veterans who were incompetent at time of death 
occurring after November 30, 1959, if derived from sources other than 
gratuitous benefits deposited by the Department of Veterans Affairs in 
Personal Funds of Patients under laws administered by the Department of 
Veterans Affairs, will be disposed of in the same manner as for 
competent veterans.
    (d) Funds deposited by the Department of Veterans Affairs in 
Personal Funds of Patients, at any office, for veterans who were 
incompetent at time of death occurring after November 30, 1959 and which 
were derived from gratuitous benefits under laws administered by the 
Department of Veterans Affairs, will be paid upon receipt of proper 
application to the following persons living at the time of settlement, 
and in the order named: the surviving spouse, the children (without 
regard to age or marital status) in equal parts, and the dependent 
parents of such veteran, in equal parts. Any funds derived from 
gratuitous benefits not disposed of in accordance with this paragraph 
shall be deposited to the credit of the applicable current 
appropriation; except that there may be paid only so much of such funds 
as may be necessary to reimburse a person (other than a political 
subdivision of the United States) who bore the expenses of last sickness 
or burial of the veteran for such expenses.
    (e) No payment shall be made under paragraph (d) of this section 
unless claim therefor is filed with the Department of Veterans Affairs 
within 5 years after the death of the veteran, except that, if any 
person so entitled under such regulation is under legal disability at 
the time of death of the veteran, such 5-year period of limitation shall 
run from the termination or removal of the legal disability.

[18 FR 1854, Apr. 3, 1953 and 25 FR 1614, Feb. 25, 1960, as amended at 
29 FR 17904, Dec. 17, 1964]