United States District Court, N.D. Illinois, Eastern Division
DONALD W. BARNETT, Plaintiff,
CAROLYN W. COLVIN, Acting Commissioner of the U.S. Social Security Administration, Defendant.
MEMORANDUM OPINION AND ORDER 
I. SCHENKIER UNITED STATES MAGISTRATE JUDGE
Donald W. Barnett seeks judicial review under 42 U.S.C.
§ 405(g) of a final decision of Defendant Commissioner
of the Social Security Administration ("SSA")
denying his request for waiver of overpayment. See
42 U.S.C. §§ 404(a). After the Administrative Law
Judge ("ALP") denied the request for waiver, Mr.
Barnett filed a timely request for review of the ALJ's
decision with the Appeals Council. The Appeals Council denied
review, and plaintiff sought review in federal court. By
agreement, the case was remanded for further proceedings (13
C 2548: doc. # 35). The Appeals Council assumed jurisdiction
of the remanded case and, on May 21, 2015, denied Plaintiffs
request for waiver (R. 267), making the Appeals Council's
decision the final determination of the Commissioner.
See 20 C.F.R. § 404.984(a).
the Court is Plaintiffs motion for summary judgment. Mr.
Barnett contends that the Appeals Council erred in denying
his request that the SSA waive its claim for overpayments
because he was not at fault for causing the overpayment, and
requiring repayment would defeat the purpose of the Social
Security Act (doc. #16: P1. Mot. for SJ, at 6-8).
reasons that follow, Plaintiffs motion is granted in part and
denied in part. The case is remanded to the SSA for further
proceedings consistent with this opinion.
Barnett has the equivalent of three years of college credits
(doc. #16-3: P1. Aff, at ¶ 1). Mr. Barnett worked at
Illinois Tool Works at least until he applied for disability
on September 27, 2000. SSA granted him Disability Insurance
Benefits ("DIB") beginning in September 2000 (R.
February 28, 2006, the SSA requested that Mr. Barnett
complete a "Work Activity Report" (R. 227). He
completed the report on June 12, 2006 (R. 227-235). In the
report, Mr. Barnett affirmed that his current employer was
the Village of Franklin Park (the "Village") (R.
231). Mr. Barnett reported that he performed part-time work
as a reserve police officer for the Village from March 11,
2004 through the time of the report, earning $12.00 per hour
(R. 231). However, elsewhere in the report, in a section
entitled "Special Work Conditions, " Mr. Barnett
wrote that in February 2006 the Village hired him part-time
on a trial basis as a building inspector, and on May 1, 2006
hired him full-time "in inspectional services on a
probational period" (R. 231, 233).
January 25, 2007, the SSA sent Mr. Barnett a letter stating
that he had completed his trial work period in November 2005
(R. 51). The letter explained that during the trial work
period, a recipient can work and earn any amount of money for
up to nine months (the months do not have to be consecutive)
and still receive disability payments (R. 53). The letter
clarified that the SSA only counts months in which a
recipient earns more than $580, 00 a month beginning in
January 2004, and $590.00 a month beginning in January 2005
(Id.). The letter further stated that after the
trial work period, a claimant's right to monthly payments
will continue if he or she is disabled and has average
earnings less than $860.00 a month beginning in January 2006
and less than $900.00 a month beginning in January 2007 (R.
54). Specifically, the letter states, "[i]f your average
earnings are more than these amounts, we call your work
'substantial' and we will stop your monthly
payments" (Id.). However, the SSA found that
Mr. Barnett's work did not amount to
"substantial" work that would disqualify him from
continuing to receive benefits (Id.). The SSA sent
Mr. Baraett a second letter on February 1, 2007 with
substantially the same information (R. 56).
Barnett contends that he contacted the SSA to request that
the SSA cancel his benefits because he was working full time
(R. 86). Specifically, Mr. Barnett telephoned the SSA's
toll-free 800 telephone number on February 5, 2007 and on
July 10, 2007, requesting that his benefits be canceled
effective immediately (R. 57). On August 19, 2007, he
completed a second work activity form. In the report, Mr.
Barnett stated that he had been working full-time for the
Village of Franklin Park as a code enforcer since May 1,
2006, starting at $15.00 per hour and earning $18.30 per hour
as of August 19, 2007 (R 240, 244).
August 21, 2007, the SSA sent a third letter notifying Mr.
Barnett that as of May 2006, he had sufficient earnings to
qualify as substantial work (R. 60). The letter stated that
Mr. Barnett was not entitled to payments from August 2006 and
thereafter (R. 60, 271). Mr. Barnett received his last DIB
check from the SSA in September 2007 (R. 81).
23, 2008, the SSA sent Mr. Barnett a fourth letter, informing
him that the SSA had overpaid him in the amount of $24,
443.00 (R. 69). The letter states that due to his work and
earnings, Mr. Barnett was not due the benefits he was paid
from May 2006 through September 2007, specifying that the
determination of the overpayment was made based on the
following benefits paid: $1, 616.00 per month from August
through November 2006; $1, 668.00 per month from December
2006 through September 2007; and, $1, 289.00 for Medicare
(Id.) The letter provided information on how
to repay the SSA, the right to appeal, and the right
to request a waiver (R. 69-70). Mr. Barnett was informed he
could obtain a waiver of the need to make repayment only if
"both of the following are true: a. The overpayment was
not your fault in any way; and b. You could not meet your
necessary living expenses if we recovered the overpayment, or
recovery would be unfair for some other reason" (R. 70).
22, 2008, Mr. Barnett filed a form with the SSA requesting
that it waive the overpayment or reconsider the overpayment
determination (R. 73-75). In his request, Mr. Barnett stated
that he thought he was entitled to the payments he received
because the payments continued to come even after he notified
the SSA that he was working full time. On October 22, 2008,
before responding to Mr. Barnett's request for waiver,
the SSA scheduled a "personal conference" for
October 29, 2008 at 11:30 a.m., at which Mr. Barnett could
review and add to his file, and (by himself or with an
assistant or attorney) could present his case to the SSA
representative who would decide his waiver request (R.
December 19, 2008, in a brief letter, the SSA denied Mr.
Barnett's request for a waiver, finding he was at fault
in causing the overpayment. The SSA explained Mr. Barnett
failed to provide the SSA with timely information regarding
his work, and accepted payments that he "should have
known and been expected to know were incorrect" (R. 85).
However, because Mr. Barnett could not repay the overpayment
in full without causing hardship, the SSA determined that Mr.
Barnett could pay forty dollars a month until the overpayment
was reimbursed (Id.).
February 10, 2009, plaintiff filed a request for a hearing
before an ALJ to review the denial of his waiver request (R.
86, 88-89). Mr. Barnett participated in a hearing before an
ALJ on December 3, 2009 (R. 47). He waived his right to be
represented by an attorney at that hearing. There is no
transcript of the December 3, 2009 hearing, but the ALJ's
decision described Mr. Barnett's testimony. In addition
to the facts listed above, Mr. Barnett testified regarding
his financial status. Mr. Barnett and his wife continue to
work; she earned $9.80 per hour (though her pay was
subsequently cut by $1.00 per hour) and he earned $19.04 per
hour (R. 48). In addition to utility expenses, they owe $22,
000.00 on their house and $30, 000.00 in credit card debt
(due in part to $10, 000.00 in costs for repairing a broken
sewer line under their driveway) (Id.). Their two