218 F. Supp. 161 | S.D.N.Y. | 1963
Plaintiff, a banquet waiter, has brought this action to review a final decision of the Secretary of Health, Education and Welfare that denied payment to plaintiff of amounts previously recovered from him by the Social Security Administration (“SSA”). The recovery was made because plaintiff failed to rer port his full 1958 earnings to the SSA,
In 1958, plaintiff earned $1,235 in wages and $1,336 in tips from his employment as a waiter, all of which he reported on his income tax return.
The issue raised on review is whether the recovery by SSA of overpayments to plaintiff either (1) “defeats the purpose” of the Act, or (2) is “against equity and good conscience,” since the Act provides that when the recipient is without fault, “there shall be no * * * recovery [of overpayments] by the United States” in either of those two instances. 42 U.S.C. § 404(b). Social Security Regulations at the time of plaintiff’s hearing before the Hearing Examiner defined these statutory concepts as follows:
“ ‘Defeat the purpose of title II’ [the Act] means defeat the purpose of benefits under this title, i. e., to provide at least a subsistence income for beneficiaries. This depends upon whether the individual has an income or financial resources sufficient for more than ordinary needs, or is largely or solely dependent upon current payment of benefits for the necessities of life.” 20 C.F.R. § 404.508.
“ ‘Against equity and good conscience’ means that it would be inequitable to ask for repayment from the individual (regardless of his financial circumstances). This depends upon whether the individual by reason of the payment has
“(a) Relinquished a valuable right, e. g., a wage earner who has retired from employment which he is now unable to regain; or
“(b) Changed his position for the worse, e. g., a wage earner entered*163 into employment relying on the erroneous advice of a Bureau repre-. sentative that his employment after entitlement is not covered and did not report the employment.” 20 C. F.R. § 404.509.
As to whether recovery by SSA would defeat the purposes of the Act, the record shows that plaintiff originally estimated his monthly expenses as approximately $204.
As to whether recovery by SSA would be against equity and good conscience, plaintiff first contends that the deduction of $40 per month from his benefits, commencing in April 1961, required him to relinquish the valuable right of being free to choose whether to do “little or no work” at his advanced age.
Ruling against social security claimants in these cases is disquieting because the amounts involved are # small, the circumstances of claimants usually engender sympathy, and frequently they are without counsel in the administrative proceeding.
. Transcript of Record filed by the Secretary, p. 203 [hereinafter cited as “Tr.”].
. Tr. p. 53.
. 42 U.S.O. §§ 301-1370. (Amended in 1962 to extend to § 1400).
. 42 U.S.C. §§ 403(b) (1), 403(e) ; 20 C.F.R. § 403.503(a) (1) (1961). The statute was amended in 1960 to increase allowable earnings. 42 U.S.C. § 403(f) [formerly § 403(e)].
. Tr. p. 91.
. Tr. pp. 257-258; see 20 C.F.R. § 404.-1027(k) (3) (1961).
. Tr. pp. 257-258.
. Tr. pp. 257-258.
. By 1961, plaintiff’s monthly benefits had been raised from $70.50 to $80.00 per month. Tr. p. 242.
. Tr. p. 237.
. Tr. p. 240.
. Tr. p. 258.
. Tr. pp. 202-203, 227-228.
. Tr. p. 236.
. Tr. pp. 236-237.
. Tr. pp. 238, 241.
. Tr. p. 11. The crucial findings of the Examiner were:
“Tlie evidence, however, does not establish that recovery would cause hardship to the claimant nor that it would be against equity and good conscience or defeat the purposes of Title II of the Social Security Act. It is noted that claimant’s financial questionnaire reports monthly income considerably in excess of his expenditures.”
. 42 U.S.C. § 405(g); Kerner v. Flemming, 283 F.2d 916 (2 Cir. 1960); Adams v. Flemming, 276 F.2d 901 (2 Cir. 1960).
. Complaint, para. 7.
. This case is clearly distinguishable from the situation in Kilby v. Ribicoff, 198 F.Supp. 184 (E.D.Pa.1961), where the action of SSA in withholding benefits compelled plaintiff to go to work and earn money, which was later held by SSA to disqualify her from benefits wrongfully withheld in the first place. In Kilby, the Court held that this was “against equity and good conscience.” Id. 198 F.Supp. at 187. In that case, it was clear on the facts that plaintiff was dependent upon the benefits, and that SSA, in effect, required plaintiff to do something which it then used as a defense to her claim, clearly inequitable under any circumstances.
. Para. 7.
. The Regulation quoted in the text (at p. 162 above) has recently been amended to provide further examples of the meaning of change of position “for the worse.” 20 C.F.R. 404.509 (1962).
. Id., Examples 3, 4.
. Although claimant here did not have counsel at the hearing before the Hearing Examiner, the Request for Review was apparently drafted by someone with legal training. Tr. pp. 6-7. In this Court, claimant has been represented by the Legal Aid Society of New York.