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Chapel v. Berryhill

United States District Court, N.D. Alabama, Southern Division

September 20, 2018





         The claimant, a recipient of disability benefits, appeals the Administrative Law Judge's denial of his request for a repayment waiver for overpaid disability benefits under 42 U.S.C. § 204(b). The Social Security Administration found that it overpaid the claimant disability benefits during two periods when he engaged in substantial gainful work without notifying the Administration, and for that reason it sought repayment from the claimant. In a decision dated July 25, 2015, the ALJ determined that the claimant was liable for repayment of $39, 824 in disability insurance benefits paid to him from April 1998 through December 1999 and April 2011 through August 2013, because he was not without fault in causing the overpayments. (R. 14, 16-17).

         On June 1, 2017, the Appeals Council denied the claimant's request for review; consequently the ALJ's decision became the final decision of the Commissioner of the Administration. (R. 5). The claimant has exhausted his administrative remedies, and this court has jurisdiction pursuant to 42 U.S.C. §§ 405(g) and 1383(c)(3).

         On appeal, the claimant argues that he was without fault in causing the overpayments because he did report his work to the Administration, and thus repayment should be waived. Additionally, the claimant presented this court with additional evidence that was not in the record for the underlying administrative proceedings.[1] For the reasons stated below, the court REVERSES and REMANDS the ALJ's decision for further development of the record.


         The court finds that the issue on appeal is whether the ALJ fully and fairly developed the record concerning the claimant's overpayment amounts.


         The standard for reviewing the Commissioner's decision is limited. This court must affirm the ALJ's decision if he applied the correct legal standards and if substantial evidence supports his factual conclusions. See 42 U.S.C. § 405(g); Graham v. Apfel, 129 F.3d 1420, 1422 (11th Cir. 1997); Walker v. Bowen, 826 F.2d 996, 999 (11th Cir. 1987).

         “No . . . presumption of validity attaches to the [ALJ's] legal conclusions, including determination of the proper standards to be applied in evaluating claims.” Walker, 826 F.2d at 999. This court does not review the ALJ's factual determinations de novo. The court will affirm those factual determinations that are supported by substantial evidence. “Substantial evidence” is “more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Richardson v. Perales, 402 U.S. 389, 402 (1971).


         Under 42 U.S.C. § 423(d)(1)(A), a person is entitled to disability benefits when the person is unable to “engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months . . . .” 42 U.S.C. § 423(d)(1)(A).

         The Commissioner of Social Security is permitted to recover overpayments when the Administration has overpaid benefits to the beneficiary. 20 U.S.C. § 1383(b)(1)(A). However, repayment of the overpaid amount may be waived if: (1) the beneficiary is found to be “without fault” regarding the overpayment, and (2) recovery would defeat the purpose of the Act or “would be against equity and good conscience.” Id. at 404(b)(1). The beneficiary bears the burden of proving that he is without fault in causing the overpayment of benefits and must do so before the Secretary may consider the second tier of the waiver statute. Viehman v. Schweiker, 679 F.2d 223, 227 (11th Cir. 1982).

         Determination of a beneficiary's fault is a highly subjective inquiry, considering criteria such as the beneficiary's age, intelligence, education, and physical and mental condition, as well as “the interaction between the intentions and state of mind of the claimant and the peculiar circumstances of his situation.” Jefferson v. Bowen, 794 F.2d 631, 633 (11th Cir. 1986) (quoting Harrison v. Heckler, 746 F.2d 480, 482 (9th Cir. 1984)).

         When a claimant challenges the Administration's initial determination of the amount of an overpayment, the Commissioner must present reliable substantial evidence of the particular overpayments. The burden of proof of the fact and amount of overpayments is on the Commissioner. Mackey v. Astrue, No. 3:08-CV-1019-J-TEM, 2010 WL 3833659, at *7 (M.D. Fla. Sept. 28, 2010) (citing McCarthy v. Apfel, 221 F.3d 1119, 1126 (9th Cir. 2000); Cannuni ex rel. Cannuni v. Schweiker, 740 F.2d 260, 263 (3rd Cir. 1984); United States v. Smith, 482 F.2d 1120, 1124 (8th Cir. 1973)).

         Additionally, the ALJ has an affirmative duty to develop a full and fair record. Brown v. Shalala, 44 F.3d 931, 934 (11th Cir. 1995); Lucas v. Sullivan, 918 F.2d 1567, 1573 (11th Cir. 1990); Smith v. Bowen, 792 F.2d 1547, 1551 (11th Cir. 1986); Cowart v. Schweiker, 662 F.2d 731, 735 (11th Cir. 1981). This duty exists even if the claimant is represented by counsel or waived his right to representation. Cowart, 662 F.2d at 735. However, “where the right to representation has not been waived, the hearing examiner's obligation to develop a full and fair record rises to a special duty.” Graham, 129 F.2d at 1422. This special duty requires the ALJ to be “especially diligent” and to “scrupulously and conscientiously probe into, inquire of, and explore for all the relevant facts.” The ALJ must ensure that favorable as well as ...

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