20 CFR 404.408a

SSR 80-28c

Duffy v. Harris, U.S.D.C. New Mexico, Civ. No. 79-386 (10/23/79)

The plaintiff applied for husband's insurance benefits in January 1978. The Social Security Administration determined, however, that such a benefit was not payable to the plaintiff because, under 42 U.S.C. 402(c)(2), it was totally offset by the amount of his monthly Federal government pension. Held, the plaintiff does not qualify for the exception to the offset provision contained in section 334(g) of Public Law 95-216 because there is no evidence to show that he met the one-half support requirement in 42 U.S.C. 402(c) as it was in effect and being administered in January 1977. Further held, the government pension offset provision and its exception do not violate the Due Process and Equal Protection requirements of the Fifth Amendment to the Constitution.

PAYNE, District Judge:

Plaintiff brings this action seeking judicial review of the final decision of the Secretary which determined that the husband's insurance benefits plaintiff is entitled to under the Social Security Act, 42 U.S.C. § 401 et seq., must be totally offset by his civil service pension.

Plaintiff's wife, Betty Duffy, became entitled to retirement insurance benefits under the Social Security Act effective January 1976. In July of 1977, the month in which he attained the age of sixty-two, plaintiff called a district office of the Social Security Administration to inquire about the filing of an application for husband's insurance benefits under § 202(c) of the Social Security Act (hereinafter referred to as "the Act"), 42 U.S.C. § 402(c). At that time, plaintiff's son was entitled to child's insurance benefits as a student on the earnings record of his mother. Hence, plaintiff was advised that if he filed and became entitled to husband's insurance benefits, the family would receive a smaller amount than it would if he deferred filing until the child's entitlement ended.[1] The child's entitlement ended effective January of 1978 and plaintiff filed an application for husband's insurance benefits on January 10, 1978. In connection with his application, plaintiff informed the Social Security Administration that he was receiving a civil service pension as a result of his employment with the Department of Defense.

On March 16, 1978, the Social Security Administration made an initial determination that although plaintiff was entitled to a husband's insurance benefit, the amount of his monthly benefit must be reduced by the amount of his federal government pension. Hence, the husband's benefit of $75.80 per month was not payable since the plaintiff's monthly Civil Service pension (approximately $14,000 per annum) far exceeded the monthly husband's benefits. Upon reconsideration the initial determination was affirmed. Plaintiff then requested a hearing. At the hearing, plaintiff testified that a claims representative advised him to file after December of 1977 so that the benefits his son was receiving would not be reduced. He further testified that the claims representative who rendered the advise appeared to have acted in good faith. Plaintiff agreed with his representative's assertion that he did not file an application for benefits in July of 1977 because he was relying upon the Administration for guidance.

On November 2, 1978, a hearing decision unfavorable to plaintiff was rendered. The decision was affirmed upon review by the Appeals Council and became the final decision of the Secretary.

Since plaintiff did not file an application for husband's insurance benefits until January of 1978, he clearly falls within the offset provision of 42 U.S.C. § 402(c)(2), which requires that plaintiff's husband's insurance benefits be offset against his Civil Service pension. The issues before this Court, therefore, are:

1. Whether the plaintiff falls within the exception to the offset provision contained in § 334(g) of Public Law 95-216 (Dec. 20, 1977); and
2. Whether the offset provision itself, assuming plaintiff is not excepted by § 334(g) of Public Law 95-216, is constitutional.

Plaintiff would qualify for the exception to the offset provision contained in § 334(g) of Public Law 95-216, only if he were to satisfy the one-half support requirement contained in the former 42 U.S.C. § 402(c), as it was administered in January 1977. Here, the record shows no evidence that the one-half support requirement has been met. Accordingly, plaintiff cannot qualify for the exception and is subject to the offset provision in 42 U.S.C. § 402(c)(2), as amended December 20, 1977.

The offset provision in 42 U.S.C. § 402(c)(2) and the exception thereto in § 334(g) of Public Law 95-216 satisfy the Due Process and Equal Protection requirements of the Fifth Amendment if the classifications therein are not patently arbitrary and bear a rational relationship to a legitimate governmental interest. Frontiero v. Richardson, 411 U.S. 677, 633 (1973); Bolling v. Sharpe, 347 U.S. 497, 499 (1964); Schneider v. Rusk, 377 U.S. 163, 168 (1964); Shapiro v. Thompson, 394 U.S. 618, 642 (1969); see also, Dandridge v. Williams, 397 U.S. 471, 485 (1970); Richardson v. Belcher, 404 U.S. 78, 81, 84 (1971); Weinberger v. Salfi, 422 U.S. 749, 768, 769 (1976); Jefferson v. Hackney, 406 U.S. 636, 546 (1972); McGowan v. Maryland, 366 U.S. 420, 426 (1961). The Court has examined the entire record, including the briefs and arguments of both counsel, and concludes, as did the Secretary, that the provisions in question are rationally calculated to avoid windfall benefits which would have otherwise been payable to government pensioners because of the affect of Califano v. Goldfarb, 430 U.S. 199 (1977) upon the Social Security Act as it existed before December 20, 1977. Moreover, the Court concludes that this statutory effort was neither arbitrary nor capricious. Accordingly the defendant's motion to affirm will be granted in a separate order.

IT IS BY THE COURT ORDERED that the final decision of the Secretary of Health, Education and Welfare in the above entitled cause be, and it is hereby affirmed and that plaintiff's complaint be, and it is hereby dismissed.

[1] Effective July 1977, plaintiff's wife was entitled to $148.80 per month and his son was entitled to $90.90 per month. If plaintiff had filed an application and become entitled to husband's insurance benefits effective July 1977, he would have been entitled to $34.20 per month and the benefits payable to his son would have been reduced to $45.50 per month. The amount payable to his wife would not have been affected. Thus, plaintiff's entitlement in July 1977 would have caused a net loss of $11.20 per month to the family overall and would have caused his son's benefit to be reduced from $90.90 per month to $45.50 per month. Sections 202(q) and 203 of the Act.

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