I-1-2-25.Fee Agreement Approval or Disapproval
Last Update: 4/8/21 (Transmittal I-1-100)
A. Receipt of a Fee Agreement
When a hearing office (HO), National Hearing Center, or the Office of Appellate Operations (OAO) receives a fee agreement, designated support staff will date stamp the document (if received by mail) and ensure the claim(s) file has a form SSA-1696 (Appointment of Representative), or other equivalent writing appointing the representative. For more information about representative appointments, see Hearings, Appeals and Litigation Law (HALLEX) manual I-1-1-11.
A fee agreement alone may constitute a valid appointment of representation if it meets the requirements for an equivalent written statement of appointment. See HALLEX I-1-1-11 A.
If the claim(s) file does not contain a valid appointment of representation, support staff will contact the individual who signed the fee agreement as the representative to address the issue.
If the representative has been properly appointed, support staff will ensure the fee agreement has been signed by both the claimant and representative and take all necessary actions to associate the document with the claim(s) file. Support staff will then ensure all necessary entries regarding representation and the fee agreement are made in the hearing level Case Processing and Management System (CPMS) or in the Appeals Council (AC) level Appeals Review Processing System (ARPS). At the hearing level, support staff will also follow the HO Standard Hearings Operations Procedure in sections 1.2 and 1.3. For paper claim(s) files only, HO or OAO staff will annotate the form SSA-1128 (Representative Involved) with pertinent information and staple it to the outside lower right corner of the claim(s) file.
B. When to Take Action on Fee Agreement
1. Action on Fee Agreement
A hearing or AC level adjudicator acts on a fee agreement when issuing a fully or partially favorable decision. See HALLEX I-1-2-6 B or I-1-2-6 C.1. The adjudicator will approve or disapprove the fee agreement using the statutory conditions set forth in HALLEX I-1-2-12, sending notice of the action to the claimant and representative. See HALLEX I-1-2-17.
At the AC level, only the A member administrative appeals judge (AAJ) acts on the fee agreement. See HALLEX I-1-2-6 C.1.
Typically, the adjudicator will send notice of the action on the fee agreement with the decision on the claim(s). However, if the adjudicator has already released the decision when the fee order is ready to be sent, support staff will mail the fee order to the claimant and representative separately, forwarding a copy to the effectuating component. Support staff will also ensure a copy of the fee order is associated with the claim(s) file.
Before closing the case, support staff will make all appropriate CPMS or ARPS entries regarding the fee agreement.
2. No Action Required on Fee Agreement
In certain circumstances, a fee agreement and a fee waiver will be in the claim(s) file, but the adjudicator will not be required to approve or disapprove the fee agreement. For example, if an appointed representative submits a fee agreement, and later waives the right to charge and collect a fee, the adjudicator will leave the fee agreement in the claim(s) file and will not approve or disapprove the fee agreement.
Moreover, an appointed representative may charge and collect a fee from a third party without the Social Security Administration's authorization, when the regulatory requirements are met. The representative, however, must waive the right to charge and collect a fee from the claimant or any auxiliary beneficiaries, and the claimant or any auxiliary beneficiaries must not be liable to pay a fee or any expenses to the representative or anyone else. See 20 CFR 404.1720(e)(1) and 416.1520(e)(1); HALLEX I-1-2-5 and POMS GN 03920.010 B.2. In this situation, the adjudicator will leave the fee agreement in the claim(s) file and not act, despite issuing a favorable or partially favorable decision, because of the waiver.
In addition, an adjudicator is not required to authorize a fee, when a court authorizes a representative's fee based on his or her actions as the claimant's legal guardian or court-appointed representative. See 20 CFR 404.1720(e)(2) and 416.1520(e)(2).
C. Adjudicator Approves Fee Agreement but May Disagree With Authorized Fee Amount
An adjudicator may request review if he or she approves the fee agreement but disagrees with the amount authorized.
At the AC level, the B member AAJ may also request review of the authorized fee amount, even though he or she did not approve the fee agreement.
D. Representative or Claimant Does Not Receive Fee Order
If the adjudicator issued a fee order approving or disapproving the fee agreement, but a representative or claimant indicates he or she did not receive a copy, support staff will send the representative and claimant another copy of the order. Support staff will also confirm with the effectuating component that it received a copy of the fee order. After completing these actions, staff will generally document the actions taken in a Remark in CPMS or ARPS.
If the adjudicator did not issue a fee order approving or disapproving the fee agreement and there is a fee agreement in the claim(s) file, the adjudicator will evaluate whether the representative timely filed the fee agreement:
If the representative filed the fee agreement with the Social Security Administration before the date of the favorable decision, the fee agreement is timely filed, and the adjudicator must approve or disapprove the fee agreement after considering the other statutory conditions (see HALLEX I-1-2-12), unless a situation described in B.2., above, applies.
If the representative filed the fee agreement after the date of the favorable decision, the statutory conditions for approval are not met (see HALLEX I-1-2-12), and the adjudicator must disapprove the fee agreement.
If the adjudicator did not issue a fee order because there is not a fee agreement in the file, support staff can ask the representative to submit a copy of the fee agreement with any documentation showing when it was submitted.
If the representative submits a fee agreement and shows it was timely submitted, the adjudicator must approve or disapprove the fee agreement after considering the other statutory conditions (see HALLEX I-1-2-12).
If the representative submits a fee agreement but is unable to show the fee agreement was timely submitted, the adjudicator will disapprove the fee agreement.
If the representative is unable to produce a fee agreement, support staff will inform the representative that he or she must file a fee petition if he or she wants to request a fee.