Washington State Department of Health and Human Services v. Guardianship Estate of Keffeler

PETITIONER: Washington State Department of Health and Human Services
RESPONDENT: Guardianship Estate of Keffeler
LOCATION: United States Court of Appeals for the Ninth Circuit

DOCKET NO.: 01-1420
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: Washington Supreme Court

CITATION: 537 US 371 (2003)
ARGUED: Dec 03, 2002
DECIDED: Feb 25, 2003

ADVOCATES:
Christine O. Gregoire - argued the cause for the petitioners
Marsha L. Levick - for the Juvenile Law Center et al. as amici curiae
Patricia A. Millett - Argued the cause for the United States, as amicus curiae, supporting the petitioners
Teresa W. Roseborough - Argued the cause for the respondents

Facts of the case

The State of Washington, through its Department of Social and Health Services, provides foster care to certain children. It also receives and manages Social Security benefits, which it uses to cover its costs, for many of those children. Such beneficiary children filed suit, alleging that the Department's use of their benefits to reimburse itself for the foster care costs violated the "anti-attachment" provision of Title II of the Social Security Act, which protects certain benefits from "execution, levy, attachment, garnishment, or other legal process." The trial court enjoined the Department from continuing to charge its foster care costs against Social Security benefits and ordered restitution of previous reimbursement transfers. The Washington Supreme Court ultimately affirmed the trial court's holding that the Department's practices violated the anti-attachment provision.

Question

Does the State of Washington's use of foster childrens' Social Security benefits to reimburse itself for some of its expenditures violate the provision of the Social Security Act that protects benefits from "execution, levy, attachment, garnishment, or other legal process?"

Media for Washington State Department of Health and Human Services v. Guardianship Estate of Keffeler

Audio Transcription for Oral Argument - December 03, 2002 in Washington State Department of Health and Human Services v. Guardianship Estate of Keffeler

Audio Transcription for Opinion Announcement - February 25, 2003 in Washington State Department of Health and Human Services v. Guardianship Estate of Keffeler

William H. Rehnquist:

The opinion of the Court in No. 01-1420, Washington State Department of Social and Health Services versus Guardianship of estate of Keffeler will be announced by Justice Souter.

David H. Souter:

This case comes to us on a writ of certiorari to the Supreme Court of Washington.

The State of Washington through the petitioner Department of Social and Health Services pays for foster care by providing funds to those who in turn support children removed from their parents custody.

The Department also receives and manages two kinds of federal Social Security benefits on behalf of these children and acting as what federal law calls the representative payee or trustee for many of the children as it is permitted to do under the Social Security Act.

Under Washington State Law the Department generally uses a foster child's Social Security benefits to reimburse itself for the funds that has already dispersed to the foster care providers.

The respondents who are beneficiary children for whom the Department serves as representative payee file this class action in State Court alleging that the Department's use of their benefits to reimburse itself violates 42 United States Codes Section 407(a).

That Section the so-called anti-attachment provision of the Social Security Act protects social security benefits from what the law refers to as execution levy attachment garnishment or other legal process.

The State Trial Court agreed with the beneficiaries that the state reimbursement violated that Section and enjoined the Department from continuing to reimburse itself for foster care costs.

The Supreme Court of Washington affirmed concluding that because the Department's reimbursement scheme involved what it called creditor type acts, it involved a form of other legal process prohibited by 407(a).

In an opinion filed today with the Clerk of Court we reverse.

Because the Department's activities do not involved execution levy attachment or garnishment before specific procedures prohibited by 407(a), the case boils down to whether the Department's use of the benefits involves other legal process.

Although the term other legal process is potentially broad, the statute uses the term restrictively for underestablished rules of interpretation, words in the statute are known by the company they keep.

Thus other legal process should be understood to be processed much like execution, levy, attachment, and garnishment and would seem to require at least some quasi-judicial mechanism by which control over the property passes through one person to another in order to secure discharge of a liability.

This definition is confirmed by the Social Security administration's own interpretation.

Applying the definition, it is apparent that the Department's activities do not involve legal process.

The State has no enforceable claim against its foster children and the Department's scheme operates on funds already in the possession and control of the Department held on terms that allow the reimbursement.

The Department's reimbursement method is permitted under the Social Security administration's regulations and its interpretations of those regs to both of which we owe deference.

In the final analysis, the beneficiaries argumented and the State Supreme Court's holding rest on the view that permitting the Department to reimburse itself for cost it would otherwise bare, violates provisions in the Act and the regulations that require a representative payee to use Social Security benefits in the best interest of the beneficiary.

Although it is true that the State could not directly compel any other representative payee to pay benefits over to the State, that fact does not render the Department's reimbursement practice antithetical to the beneficiary's best interest within the meaning of the Act and the regulations.

For instance, under her authority the Commissioner of Social Security has read the open ended term best interest in light of the Act's basic objectives to provide for a minimum level of income.

Thus, she has decided that a representative payee serves the beneficiary's interest by seeing that basic needs are met not by maximizing a trust fund.

For that matter if the beneficiarie's argument prevail many children would actually lose benefits since eligibility for some benefits is lost if resources creep up above a minimum level.

The opinion of the Court is unanimous.