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Menard v. Security

United States District Court, S.D. Illinois

September 8, 2015

MARTHA J. MENARD, Plaintiff,
v.
COMMISSIONER OF SOCIAL SECURITY, Defendant.

MEMORANDUM and ORDER

J. PHIL GILBERT, District Judge.

In accordance with 42 U.S.C. § 405(g), plaintiff Martha J. Menard seeks judicial review of the final decision of the Commissioner of Social Security finding her at fault in causing overpayment of benefits and denying waiver of repayment.

Procedural History

Ms. Menard began receiving retirement/survivor's benefits (formerly called widow's benefits) in 1995 or 1996. In May, 2011, the Social Security Administration notified her that she had been overpaid in the amount of $142, 749.80. After her requests for reconsideration and for waiver of overpayment were denied, she requested a hearing. (Tr. 10). ALJ William L. Hafer found that she had been overpaid, that she was at fault in causing the overpayment and that she was liable for repayment in a written decision dated November 23, 2012. (Tr. 10-13). The Appeals Council denied review, and the decision of the ALJ became the final agency decision. (Tr. 3). Administrative remedies have been exhausted and a timely complaint was filed in this Court.

Issues Raised by Plaintiff

Plaintiff raises the following issues:

1. The ALJ erred by failing to address whether the agency had the authority to reopen her claim for benefits after 15 years.
2. The ALJ's findings that plaintiff had been overpaid and the amount of the overpayment were not supported by substantial evidence.
3. The agency violated plaintiff's due process rights because the original claim file has been destroyed, making it impossible to her to prove that she was without fault in causing the overpayment, and by failing to afford her a full and fair hearing.

Applicable Legal Standards

This Court has jurisdiction to review "any final decision of the Commissioner of Social Security made after a hearing." 42 U.S.C. 405(g). See, Boley v. Colvin, 761 F.3d 803 (7th Cir. 2014). A hearing was held, and the ALJ's written decision was designated by the Appeals Council as "the final decision of the Commissioner of Social Security in your case." (Tr. 6). Thus, this Court has jurisdiction to review the decision of November 23, 2012.

Congress has directed the agency to seek adjustment (repayment) of funds when it has mistakenly overpaid benefits. 42 U.S.C. § 404(a); Heins v. Shalala, 22 F.3d 157, 159 (7th Cir.1994). However, the agency's authority to obtain repayment is limited by §404(b):

In any case in which more than the correct amount of payment has been made, there shall be no adjustment of payments to, or recovery by the United States from, any person who is without fault if such adjustment or recovery would defeat the purpose of this subchapter or would be against equity and good conscience. In making for purposes of this subsection any determination of whether any individual is without fault, the Commissioner of Social Security shall specifically take into account any physical, mental, educational, or linguistic limitation such individual may have (including any lack of facility with the English language).

Thus, the agency may not recover an overpayment from the recipient where: (1) the recipient was not at fault in causing the overpayment, and (2) recovery would either defeat the purposes of Title II of the Social Security Act or otherwise be against equity and good conscience. 20 C.F.R. § 404.506. However, if the recipient was at fault in causing the overpayment, the ALJ's inquiry is at an end. Heins, 22 F.3d at 163 n. 2.

If the recipient was not at fault, the ALJ must consider the second element, i.e., whether recovery of the overpayment would defeat the purposes of the Social Security Act or be against equity and good conscience. Recovery defeats the purposes of the Act when it "deprives a person of income required for ordinary and necessary living expenses, " depending on the income and financial resources of the recipient. 20 C.F.R. § 404.508; Banuelos v. Apfel, 165 F.3d 1166, 1169 (7th Cir. 1999), overruled on other grounds in Johnson v. Apfel, 189 F.3d 561 (7th Cir. 1999). Recovery may be against equity and good conscience when the recipient has changed position to her detriment based on the receipt of the overpaid funds. Banuelos, 165 F.3d at 1171.

This Court reviews the Commissioner's decision to ensure that the decision is supported by substantial evidence and that no mistakes of law were made. It is important to recognize that the scope of review is limited. "The findings of the Commissioner of Social Security as to any fact, if supported by substantial evidence, shall be conclusive...." 42 U.S.C. § 405(g). This Court uses the Supreme Court's definition of substantial evidence, i.e., "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Richardson v. Perales, 91 S.Ct. 1420, 1427 (1971).

In reviewing for "substantial evidence, " the entire administrative record is taken into consideration, but this Court does not reweigh evidence, resolve conflicts, decide questions of credibility, or substitute its own judgment for that of the ALJ. Brewer v. Chater, 103 F.3d 1384, 1390 (7th Cir. 1997). However, while judicial review is deferential, it is not abject; this Court does not act as a rubber stamp ...


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