United States District Court, D. Massachusetts
MEMORANDUM AND ORDER ON PLAINTIFF’S MOTION TO REVERSE AND DEFENDANT’S MOTION TO AFFIRM THE DECISION OF THE COMMISSIONER
F. Dennis Saylor IV United States District Judge
This is an appeal of the final decision of the Commissioner of the Social Security Administration (“SSA”) denying a waiver of overpayment of Title II disability benefits. Plaintiff Lucian Perreault appeals the Commissioner’s denial of his request for waiver of overpayment on the ground that the decision was not supported by “substantial evidence” pursuant to 42 U.S.C. § 405(g). Specifically, plaintiff contends that (1) the record evidence does not establish the amount of overpayment; (2) the SSA failed to follow certain administrative procedures, thereby unfairly prejudicing plaintiff; and (3) recovery of overpayment should be waived because recovery would defeat the purpose of Title II of the Social Security Act.
Pending before the Court are plaintiff’s motion to reverse the decision of the Commissioner and defendant’s motion for an order affirming the decision of the Commissioner. For the reasons stated below, the Court will vacate the Commissioner’s decision in part and remand the case to the SSA for the purposes of determining the amount of overpayment.
On May 12, 2000, Lucian Perreault had an anxiety attack while working for the City of Boston Election Department. (R. 149). Perreault was subsequently diagnosed with post-traumatic stress disorder and major depression. (Id.). On April 15, 2004, the City of Boston entered into a settlement agreement with Perreault, agreeing to a lump sum payment of $90, 000 in consideration for waiver of Perreault’s rights to sue the City pursuant to the Massachusetts Workers Compensation Act. (R. 148).
Perreault filed for Social Security disability benefits on June 22, 2004. (R. 131). On November 8, 2004, the SSA found that Perreault was disabled as of the date of his anxiety attack. (R. 136). The SSA awarded retroactive Title II disability benefits beginning in June 2003, providing him with a lump sum of $6, 931.75 in retroactive benefits and monthly payments of $475 per month beginning in December 2004. The SSA also appointed Perreault’s wife, Sharon Perreault, as his representative payee. Id.
Perreault filed for bankruptcy on October 15, 2005, and was granted a discharge on February 8, 2006. (R. 90). Perreault subsequently requested revocation of the discharge on advice of counsel, due to the long-term effects bankruptcy would have on his credit. (R. 255). The bankruptcy court granted the revocation request on March 13, 2007. (R. 141).
On January 13, 2008, the SSA notified Perreault that he had been overpaid benefits in the amount of $21, 683.80 for the period from May 1, 2004, to December 31, 2007, due to failure to report receipt of a public disability pension. (R. 127). The SSA revoked nearly all of Perreault’s benefits on January 30, 2008. (R. 69).
On June 13, 2008, Perreault and his wife took out a mortgage on their property in Charlestown, Massachusetts. They later struggled to keep up with mortgage payments. (R. 94- 95, 260). On December 10, 2010, Perreault and his wife sold the property in Charlestown and purchased a new home in Everett, Massachusetts. (R. 242-44). Perreault maintains that he has continued to struggle with his finances, submitting evidence of $20, 000 in personal loans from friends in June 2010, as well as evidence of various personal and home mortgage loans. (R. 91-93, 214-15, 246, 257). Perreault asserts that his increased financial difficulties were due to the loss of his social security benefits, which “led him into a financial freefall.” (R. 217).
II. Procedural History
Perreault filed a request with the SSA for reconsideration along with a request for waiver of overpayment sometime in the first half of 2008. (Compl. ¶ 7; Ans. ¶ 7; R. 69, 79, 167). On March 2, 2009, the SSA sent him a notice affirming its decision to assert overpayment of benefits and informing him that the SSA would notify him concerning his request for waiver. (R. 63-68).
On March 24, 2009, Perreault filed a request for a hearing by an Administrative Law Judge, stating that he believed that the finding of overpayment was erroneous. (R. 61). The hearing took place on June 10, 2010. (R. 186). On February 25, 2011, Perreault received an unfavorable decision from the ALJ. (R. 124). Administrative Law Judge Margaret Donaghy found that (1) the SSA correctly assessed the amount of overpayment to Perreault; (2) Perreault was at fault in causing the overpayment; and (3) recovery of the overpayment should not be waived. (R. 128-30).
On March 11, 2011, Perreault requested a review of Judge Donaghy’s decision. (R. 185). On February 22, 2012, the SSA Appeals Council vacated the decision and remanded the case for further proceedings. (R. 189-94). The Appeals Council found that (1) the decision concerning the overpayment was not supported by substantial evidence; (2) the ALJ did not properly consider Perreault’s disability when determining fault; (3) the ALJ did not properly consider that a representative payee had been appointed when determining fault; (4) the ALJ did not properly consider the possible discharge of debt in Chapter 7 bankruptcy proceedings when considering the issue of waiver; and (5) Perreault was without fault in causing overpayment because the SSA had appointed a representative payee, who was responsible for managing his funds. (R. 191-93).
A second hearing before an ALJ was held on July 3, 2012. (R. 49). On July 31, 2012, the SSA sent Perreault a second notice of unfavorable decision. (R. 46). Administrative Law Judge Joel Gardiner affirmed that Perreault had been overpaid and denied waiver of the overpayment. (R. 49). Specifically, Judge Gardiner found that (1) the SSA correctly assessed the amount of overpayment; (2) Perreault was not at fault in causing the overpayment; (3) recovery of the overpayment would not defeat the purpose of Title II of the Social Security Act; (4) recovery of the overpayment would not be against equity and good conscience; and (5) recovery of the overpayment had not been waived. (R. 51-53).
On March 25, 2013, Perreault filed a request for review of Judge Gardiner’s decision. (R. 13). On August 7, 2014, the Appeals Council denied the request. (R. 4).
A. Standard of Review
Pursuant to § 205(g) of the Social Security Act, this Court may affirm, modify, or reverse the Commissioner’s decision, with or without remanding the case for a rehearing. 42 U.S.C. § 405(g). The Commissioner’s finding on any fact shall be conclusive if it is supported by substantial evidence and must be upheld “if a reasonable mind, reviewing the evidence in the record as a whole, could accept it as adequate to support his conclusion, ” even if the record could support a different result. Rodriguez v. Sec’y of Health and Human Servs., 647 F.2d 218, 222 (1st Cir. 1981); Evangelista v. Sec’y of Health and Human Servs., 826 F.2d 136, 144 (1st Cir. 1987). When applying the substantial evidence standard, the Court must consider that it is the province of the ALJ, not the courts, to find facts, decide issues of credibility, draw inferences from the record, and resolve conflicts in the evidence. See Irlanda Ortiz v. Sec’y of Health and Human Servs., 955 F.2d 765, 769 (1st Cir. 1991) (citing Rodriguez, 647 F.2d at 222). Reversal is warranted only if the ALJ “committed a legal or factual error in evaluating a particular claim, ...