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Dykema v. Berryhill

United States District Court, D. Connecticut

July 24, 2018

NANCY A. BERRYHILL, Acting Commissioner of Social Security, Defendant.



         Plaintiff brings this action pursuant to section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), seeking this court's review of a final determination of the Commissioner of Social Security (the Commissioner) denying his request for a waiver of recovery of overpayment of Title II disability insurance benefits (DBI) and Title XVI social security income benefits (SSI). Now before the Court are Plaintiff's Motion for an Order Revering the Decision of the Commissioner [Doc. # 16], and the Commissioner's Motion for an Order Affirming the Decision of the Commissioner [Doc. # 17]. For the reasons that follow, that Court grants Plaintiff's motion and remands this case to the Commissioner for further proceedings consistent with this opinion.

         Legal Standard

         “A district court reviewing a final . . . decision [of the Commissioner of Social Security] pursuant to section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), is performing an appellate function.” Zambrana v. Califano, 651 F.2d 842 (2d Cir. 1981). The court must first ascertain whether the Commissioner applied the correct legal principles in reaching her conclusion, and then whether the decision is supported by substantial evidence. Johnson v. Bowen, 817 F.2d 983, 985 (2d Cir. 1987). Therefore, absent legal error, a decision of the Commissioner cannot be set aside if it is supported by substantial evidence. Berry v. Schweiker, 675 F.2d 464, 467 (2d Cir. 1982). If the Commissioner's decision is supported by substantial evidence, the decision will be sustained, even where there may also be substantial evidence to support the contrary position. Schauer v. Schweiker, 675 F.2d 55, 57 (2d Cir. 1982). Substantial evidence is “‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.'” Williams v. Bowen, 859 F.2d 255, 258 (2d Cir. 1988) (quoting Richardson v. Perales, 402 U.S. 389, 401 (1971)). Substantial evidence must be “more than a scintilla or touch of proof here and there in the record.” Id. at 258.


         Plaintiff was found disabled due to mental impairments and began receiving benefits in March 1995, when he was 33 years old. He currently continues to receive benefits. Throughout this time, Plaintiff worked intermittently, earning different amounts of wages (or no wages) over the years. The Commissioner has, at various times, stopped and then restarted Plaintiff's benefits, and/or has adjusted them based on his income level. In 2006, Plaintiff was notified that he had been overpaid benefits in the amount of $13, 971.00, which was to be repaid by withholding $25 per month from subsequent benefit payments.

         Beginning in 2008, Plaintiff obtained a case manager through Southeastern Mental Health Authority[1]. This case manager helped him with everyday functioning, including helping him to obtain assistance in handling financial matters. On July 3, 2009, the Social Security Administration (SSA) notified Plaintiff that Sound Community Services had been appointed as Plaintiff's representative payee because he needed help with managing his finances and meeting his needs. (R. 82). This notice informed Plaintiff that Sound Community Services would manage his finances, including reporting changes that impact benefits, and would document how his benefits were used. (R. 82). The notice also stated that enclosed was a pamphlet entitled “What you should know when a representative payee manages your money, ” but this pamphlet does not appear in the record following the notice.

         In October 2012, the Commissioner notified Sound Community Services that Plaintiff had been overpaid benefits, mainly due to his wage levels from March 2003 through September 2012, in the amount of $19, 406.70. Plaintiff requested a waiver of the overpayment, which was denied. Plaintiff then requested a hearing. On October 15, 2104, Plaintiff and his case manager testified at a hearing before administrative law judge Donald Thomas (the ALJ).

         Plaintiff, who was 52 years old at the time of the hearing, resided with his girlfriend. (R. 28). He testified that he dressed and bathed himself, drove, did yard work and vacuuming, and cooked simple meals at home. (R. 45-46). He did not grocery shop or do laundry. (R. 46-47). A nurse comes to his home to administer medication. (R. 45). Plaintiff testified that he used a computer “a little bit” to play a flight simulator game and to go on Facebook. (R. 47-48). He went surfing once in the past two years. (R. 47-48). Plaintiff stated that he take taken flying lessons when he was younger, but had not been in a plane in four years. (R. 49).

         Plaintiff had not worked for two years prior to the hearing. (R. 29). He lost his last job because he was not performing adequately due to his schizoaffective and bipolar disorders. (R. 30). Plaintiff was hospitalized from April 2014 through June 2014 when he stopped taking his psychiatric medications; this was part of a pattern of psychiatric hospitalizations throughout his life. (R. 50-51). Plaintiff testified that his mother, girlfriend, or case manager help him with paperwork, including completing his applications for benefits, because his concentration and reading comprehension prevented him from doing so himself. (R. 43). He did not know when or how he was granted benefits, and testified that he thought he reapplied annually. (R. 39-40). He testified that he did not know that he had worked “over the limit, ” and that he reported all of his work activities to his case manager at Southeastern Mental Health Authority, Patricia Ring. (R. 39, 51). He expected that his case manager would tell him to “slow down” his work if it was a problem. (R. 39, 51).

         Patricia Ring, LCSW, testified that she served as Plaintiff's case manager from 2008 through March 2014. (R. 32-33). The role of the case manager is to assist individuals with chronic mental illness with housing, finances, and general everyday functioning. (R. 33). If a client needs help with finances, the case manager would arrange for Sound Community Services to serve as a payee; the case manager served as a liaison between Sound Community Services and the client. (R. 33). Ms. Ring testified that she helped Plaintiff create a monthly budget, and then sent the budget to Sound Community Services so that it could pay Plaintiff's bills. (R. 33-34). This monthly budget included income from Plaintiff's wages. (R.35). Ms. Ring stated that she would report income information to the representative payee, and that she did not give clients a reason to think they had to do anything more. (R. 36). She testified that she was not trained on the reporting requirements of representative payees or benefit recipients, and that she thought a disability benefit recipient was not precluded from working (R. 35, 37).

         The ALJ issued a decision on December 19, 2014, declining to waive recovery of the overpayment, and finding Plaintiff liable for repayment of $19, 406.70. The ALJ concluded Plaintiff was “at fault” in causing the overpayment because he knew or should have known that repeated changes in his work status and earned income could trigger changes in his benefits, and he relied on his communications to his case manager and representative payee and took no steps himself to inform the Commissioner of changes in his wages. (R. 19). The ALJ determined Plaintiff “has demonstrated significant reading skills, education level, cognitive capabilities, and work skills” that indicate he was capable of informing the Commissioner of changes to his wage level. (R. 22). In support of this conclusion, the ALJ reasoned that the case involved several years of applications, reporting forms, and recoupment of several overpayments, so Plaintiff had been introduced to the concept that he was obligated to provide the Commissioner with current information about his work activities and wages. (R. 22). The ALJ noted that Plaintiff attended college classes for about two years. (R. 22). The ALJ also found that Plaintiff's weekly and yearly activities show his capability to inform the Commissioner of the changes. These activities included making “easy meals, ” driving, using a computer, playing a video game, and going on a vacation in 2013. (R. 23).

         The parties filed a Joint Statement of Material Facts [Doc. # 16-2]. The Court adopts this joint statement, and ...

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