LOCATION: U.S. Court of Appeals for the Second Circuit
DOCKET NO.: 70-53
DECIDED BY: Burger Court (1971-1972)
CITATION: 404 US 78 (1971)
ARGUED: Oct 13, 1971
DECIDED: Nov 22, 1971
John Charles Harris - for appellee
Richard B. Stone - for appellant
Facts of the case
Media for Richardson v. Belcher
Audio Transcription for Oral Argument - October 13, 1971 in Richardson v. Belcher
Warren E. Burger:
We will hear arguments next in number 53, Richardson against Belcher.
Before you proceed Mr. Stone, it appears to me that we could announce for council in number 5040, the Mayer against Chicago.
It is very unlikely that the case will be reached today and if you wish to be excused until tomorrow morning at 10:00, you maybe.
Mr. Stone, you may proceed.
Richard B. Stone:
Thank you, Mr. Chief Justice, and may it please the Court.
This case which is on direct appeal from the United States District Court from the Southern District of West Virginia is in a somewhat unusual posture and that a Single Judge District Court has declared unconstitutional Section 224, the Social Security Act.
In the more normal instance of course, an adjudication that a Federal Statute is unconstitutional, would originate and direct appeal would be taken from a Pre-judge Court.
This Court has held; however in a closely similar context in Flemming v. Nestor reported at 363 U.S. and in other cases as well.
That a Pre-judge Court is not mandatory under 28 U.S.C 2282, when an action based on the alleged unconstitutionality of the Federal Statute, does not seek to enjoin the operation of statutory scheme, but merely to acquire the payment of some benefit afforded by that scheme and the Court has invariably retained direct appeals in these circumstances and no question has been raised by other side as to jurisdiction, and I take it that there is none.
In this case, the provision in question, Section 224 of the Social Security Act, provides that Social Security Disability Benefits, which caused by roughly to lost earnings resulting from the claimant’s disability must be reduced according to a fairly complex formula by virtue of the recipient’s simultaneous receipt of periodic Workman’s Compensation benefits under a state of Federal Workman’s Compensation Plan, in the ordinary case, of course, it is the state plan.
The offset provision only applies for purposes relevant here.
If the total of the claimant’s Social Security Disability Benefits and his Workman’s Compensation Benefits exceed 80% of his average monthly earnings and that is gross earnings without taking into account tax computations acquired to injury.
Richard B. Stone:
Richard B. Stone:
Yeah, the average monthly earning is computed on a five year period.
And, benefits are only reduced in so far as they exceed 80% of those earnings, and of course, the actual effect for anyone whose tax status put him -- causes him pay income tax, in excess of 20% of his gross salary, actually comes out even with the 80%, comes out with more and take home pay that he had acquired through his injury.
The appellee in this case Mr. Belcher became disabled in 1968 and was awarded at $330 a month in Social Security and Disability Benefits without regard to any Workman’s Compensation, and the Secretary had no notice of his receipt of Workman’s Compensation at that time and that award was made in October of 1968.
Three months later, the Department of Health, Education and Welfare, notified Mr. Belcher that his Federal benefits would be reduced by a $104 a month because of his simultaneous receipt of $203 per month in State Workman’s Compensation Benefits.
The scheme is quite simple, without the offset, Mr. Belcher would have received a total of $534 in Social Security and Workman’s Compensation Benefits which would have been a 100% of his prior gross earnings, and as a result of the offset, his benefits total to $430 or exactly 80% of his average prior earnings.
Mr. Belcher requested a hearing to challenge the reduction of his Federal benefits and the hearing was held before a Hearing Examiner at which appellee was represented by an Attorney, who I believe represents him here in this Court today.
The Hearing Examiner upheld the reduction and this ruling became in the normal course of HEW Administrator rulings, the final decision of the secretary of HEW.
I believe he then brought suit in the United States District Court under Section 405 or 42 U.S.C. 405G to reveal (somebody coughed) the Secretary’s administrative decision.
And I take it that at no point in the court below or in the administrative process has appellee denied in any aspect of the factual or legal basis which underlay the Secretary’s determination that Section 224 applied to him and precisely the manner in which HEW applied it.
Nor has appellee raised any question whatsoever as to the procedural rights, such as an evidentiary hearing which has been fully afforded to him.
His sole contention and the sole ground of decision in the District Court below was that it is unconstitutional, as a substantive matter for Congress to reduce Social Security Disability Benefits by virtue of Workman’s Compensation Benefits.
In upholding appellee’s claim, the Court below stands alone and it odds with eight other District Courts, at least eight other District Courts that have routinely ruled on this question and with their recent decision of the 6th circuit Court of Appeals, which has upheld the constitutionality of Section 224.
Now, the Court arrived at its decision that Section 224 is unconstitutional on essentially two grounds.
The first of these grounds, I believe, can be dealt with rather briefly and I think it reflects a misconception of certain decisions of this court which are to be pretty readily apparent here.
In Goldberg Versus Kelly, at 397 U.S., this Court held it when the Administrators of a State Welfare Program, in that case it was the Aid to Dependent Children program, determined that a particular recipient no longer qualifies for benefits under the statutory standards governing that program, those benefits that cannot be cut off until the recipient has been given some sort of an evidentiary hearing.