SSR 72-28c: SECTIONS 204(a) and (b) -- (42 U.S.C. 404(a) and (b)). -- DISABILITY INSURANCE BENEFITS -- RECOVERY OF OVERPAYMENT -- FAILURE TO REPORT WORK ACTIVITY AS CONSTITUTING FAULT
20 CFR 404.507
Veronie v. Secretary, U.S.D.C., W.D. La., Opelousas Div. Civ. No. 15148, (8/20/71), (CCH, U.I.R., FED. PARA. 16,358)
- Where claimant received overpayment of disability insurance benefits as a result of his failure to notify the Administration of his return to work activity, held, claimant was not without fault in causing the overpayment because (1) claimant was required to give notice even though he may not have returned to the same work level he maintained prior to his disability, and (2) the "fault" test was not whether the beneficiary actually knew that information concerning his return to work activity was material but rather whether he should have known that such information was material.
SCOTT, District Judge: Horace Veronie brings this action under Section 205(g) of the Social Security Act, 42 U.S.D. § 405(g), to review a final decision by the Secretary of Health, Education and Welfare that claimant had received an overpayment of social security disability payments in the amount of $902.00.
The scope of this Court's review is limited to determining whether there is substantial evidence to support the findings of the Secretary. It is not the function of this Court to "re-weigh the evidence" but to determine if there is substantial evidence to support the administrative decision. Rome v. Finch, 409 F.2d 1329, 1330 (5th Cir. 1960); Knox v. Finch, 427 F.2d 919 (5th Cir. 1970); Cross v. Finch, 427 F.2d 406 (5th Cir. 1970).
Section 204(a)(1) of the Act, 42 U.S.C. 404(a)(1) provides in pertinent part:
- (a) Whenever the Secretary finds more or less than correct amount of payment has been made to any person under this sub-chapter, proper adjustment ore recovery shall be made, under regulations prescribed by the Secretary, as follows:
- (1) With respect to payment to a person of more than the correct amount, the Secretary shall . . . require such overpaid person or his estate to refund the amount in excess of the correct amount . . .
Section 204(b) of the Act, 42 U.S.C. 404(b) provides:
- (b) In any case in which more than the correct amount of payment has been made, there shall be no adjustment of payments to, or recovery by the United States from, any person who is without fault if such adjustment or recovery would defeat the purpose of this subchapter or would be against equity and good conscience.
The hearing examiner made findings as to claimant's period of disability, ability to repay, the date when claimant returned to work activity, and fault or lack of fault of the claimant. It is the function of this Court to review the record and upon such record to determine whether the decision of the examiner is supported by substantial evidence.
The claimant sustained a severely fractured leg in an automobile accident on June 21, 1965. On February 11, 1966 he filed for and was granted a period of disability benefits. The examiner found that the last benefit check to which claimant was entitled was for the month of June 1967. The determination as to the time for the termination of claimant's benefits was based upon a finding that he returned to work activity in March 1966. In support of the finding that claimant returned to work in March 1966 the examiner had before him the signed statement made by Mr. Veronie dated May 14, 1968.
"I drove out to the field daily beginning sometime in March 1966 to see what needed to be done. I would tell my son what was needed and he saw that it was done. I decided when to plant, when to harvest, go to town to pick up parts we needed for the equipment. I hired the labor and paid them. He supervised them. I worked about 2 hours a day, from March thru Sept. The rice crop was finished in Sept. and the bean crop in Oct."
This statement supports the examiner's finding that claimant returned to work activity in March of 1966. It is not necessary that the claimant return to the same work level that he maintained prior to his disability, rather it is sufficient to require notice to the Secretary's representative if the claimant engages in any substantial gainful activity.
Having found substantial evidence to support the examiner's finding that claimant returned to work activity in March 1966, this Court agrees with the finding that claimant was overpaid benefits for the period July 1967 through March 1968 in the amount of $902.00. It was the duty of the claimant to report any work activity to the Secretary; no report of such activity was ever filed by the claimant.
Section 204(b) of the Act, 42 U.S.C. 404(b) provides that the United States cannot recover any overpayments made to an individual who is both "without fault" and where the "recovery would defeat the purpose of this sub-chapter or would be against equity and good conscience". The examiner found that Mr. Veronie did not meet the twofold test of the statute and therefore was obliged to refund the overpayment.
Fault as used in Section 204(b) of the Act, 42 U.S.C. 404(b) is defined in 20 CFR 404.507 as:
- "Fault" as used in "without fault" . . . what constitutes fault on the part of the overpaid individual . . . from whom the Administration seeks to recover the overpayment depends on whether the facts show that the incorrect payment to the individual . . . resulted from:
- . . . (b) Failure to furnish information which he knew or should have known to be material; . . ." (emphasis supplied)
The test for "fault" set out in the Code of Federal Regulations is constructive fault rather than an actual fault test. As such, it is not necessary that the claimant actually knew the information he failed to furnish was material. The decisive question is whether he should have known that such information was material. When the claimant signed his application for benefits he agreed to notify the Social Security Administration if he returned to work. If there was some question in the claimant's mind as to whether his activity constituted work in the terms of the Act, he had merely to contact the local office and seek their advice and opinion. Taking into consideration the constructive nature of the "Fault" test and Mr. Veronie's statement, . . . this Court finds that the examiner's finding that the claimant was not without fault was based upon substantial evidence. In view of claimant's failure on the first phase of the Section 204(b) test, the Court does not reach the question of Mr. Veronie's ability to repay the overpayment.
A review of the entire record convinces the Court that the finding and decision of the Secretary is supported by substantial evidence. Accordingly, it is ORDERED that defendant's Motion for Summary Judgment is GRANTED.