I-1-2-49.ALJ or AAJ Incorrectly Approved Fee Agreement
Last Update: 1/13/15 (Transmittal I-1-80)
A. Effectuating Component Actions
1. Referral Procedures
Occasionally, an administrative law judge (ALJ) or administrative appeals judge (AAJ) may incorrectly approve a fee agreement when the agreement does not meet the requirements of the Social Security Act or an exception to the fee agreement process applies, as described in the Hearings, Appeals and Litigation Law (HALLEX) manual I-1-2-12. Processing center (PC) and field office (FO) personnel may not reverse a fee agreement decision made by an ALJ or an AAJ. When the PC or FO authorizer responsible for effectuating a favorable hearing or Appeals Council (AC) decision concludes that the ALJ or AAJ incorrectly approved a fee agreement, the authorizer will take the following actions:
Process the claim to payment;
Withhold 25 percent of past-due benefits if the representative is eligible for direct fee payment;
Request an incomplete notice to the claimant, deferring action on the fee agreement;
Prepare a protest memorandum, addressed to the Regional Chief ALJ (RCALJ) if the decision maker was an ALJ or the Deputy Chair of the AC if the decision maker was an AAJ; and
Send the memo with a copy of the ALJ or AC decision, the appointment(s) of representative(s), the fee agreement, the order approving the fee agreement, and any relevant documents, to the RCALJ (for ALJ decisions) or the Attorney Fee Branch (AFB) (for AC decisions).
As explained in HALLEX I-1-2-44 C, if an ALJ in a National Hearing Center (NHC) incorrectly approves a fee agreement, the RCALJ that supervises the hearing office that transferred the case to the NHC will handle the administrative review of the fee agreement approval. However, for administrative efficiency reasons, in the Program Operations Manual System (POMS) GN 03940.090D, the PC and FO are instructed to send protest memos to the RCALJ of the region where the claimant is currently residing. While the impact should be minimal, if the receiving RCALJ does not have jurisdiction over the matter, the receiving office will forward the protest memo to the RCALJ with jurisdiction and notify the PC or FO of the transfer.
If the effectuating component does not receive a response within 45 days, it will:
Follow up with the RCALJ (for ALJ actions) or the AFB (for AC actions), by fax or telephone, and
Diary the claim for another 15 days.
2. Procedures After OHO or OARO Acts on Referral
If the Office of Hearings Operations (OHO) or Office of Analytics, Review, and Oversight (OARO) reverses the fee agreement determination, the PC or FO will diary the case for receipt of a fee petition and fee authorization from OHO or OARO.
If OHO or OARO affirms the fee agreement determination, the PC will follow standard procedures for processing an approved fee agreement.
B. OHO and OARO Actions
If a PC or FO authorizer refers a case to OHO or OARO because he or she believes the ALJ or AAJ incorrectly approved a fee agreement, the following individuals have authority to review the issue:
For hearing level cases, the RCALJ who has jurisdiction over the claimant's servicing hearing office (HO) or, if issued by an NHC ALJ, the RCALJ who has jurisdiction over the HO that transferred the case to the NHC (see the NOTE in subsection A above); or
For AC cases, the Deputy Chair.
Within 30 days, the RCALJ or Deputy Chair will review the disputed action to determine whether the agreement meets the provisions in section 206(a)(2)(A) of the Social Security Act (and is not excepted from the fee agreement process). These procedures are set forth in HALLEX I-1-2-12.
If the RCALJ or Deputy Chair concludes the ALJ or AAJ incorrectly approved a fee agreement, he or she will:
Issue an order to the claimant disapproving the fee agreement, advising that if the representative intends to charge and collect a fee, he or she must file a fee petition;
Send a copy of the order disapproving the fee agreement to the representative with a cover letter; and
Send a copy of the corrective action to the respective PC or FO and the ALJ or AAJ who signed the prior order (see HALLEX I-1-2-114 for sample fax cover sheets).
Refer to HALLEX I-1-2-112 for sample language for the order disapproving the fee agreement and the cover letter to the representative.
If the RCALJ or Deputy Chair affirms the fee agreement approval, he or she will advise the PC or FO by memorandum to process the representative's fee under the fee agreement process. Refer to HALLEX I-1-2-113 for sample language for the memorandum.