Bryant v. Carleson

• Decision Date: 27 May 1971
• Docket Number: No. 26898.,26898.
• Parties: Dorothy BRYANT, individually and on behalf of her four minor children, et al., Appellees, v. Robert CARLESON, as Director of the Department of Social Welfare of the State of California, Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

444 F.2d 353 (1971)

Dorothy BRYANT, individually and on behalf of her four minor children, et al., Appellees, v. Robert CARLESON, as Director of the Department of Social Welfare of the State of California, Appellant.

No. 26898.

United States Court of Appeals, Ninth Circuit.

May 27, 1971.

Elizabeth Palmer, Deputy Atty. Gen. (argued) Evelle J. Younger, Atty. Gen. of the State of California, San Francisco, Cal., for appellant.

Peter E. Sitkin, San Francisco, Cal. (argued), Ralph Santiago Abascal, Marysville, Cal., Sidney M. Wolinsky, of San Francisco Neighborhood Legal Assistance Foundation, San Francisco, Cal., for appellees.

L. Patrick Gray, III, Asst. Atty. Gen., Morton Hollander, Raymond D. Battocchi, Attys., Dept. of Justice, Washington, D. C., Joel Cohen, Asst. Gen. Counsel, Myron J. Berman, Deputy Asst. Gen. Counsel, Dept. of Health, Education & Welfare, Washington, D. C., Stephanie W. Naidoff, Asst. Regional Atty., Dept. of HEW, James L. Browning, Jr., U. S. Atty., San Francisco, Cal., for amicus curiae.

Before CHAMBERS and HAMLEY, Circuit Judges, and GOODWIN, District Judge.^*

HAMLEY, Circuit Judge:

On August 6, 1969, Dorothy Bryant, Mary Frierson, Beverly Young and Rosalie Boehme brought this class action against John C. Montgomery, the then Director of the Department of Social Welfare, State of California. Montgomery has since been succeeded by Robert Martin, and he, by Robert B. Carleson. Plaintiffs' purpose in bringing the action was to obtain declaratory and injunctive relief because, with respect to welfare aid to families with dependent children (AFDC), California had allegedly failed to comply with the Congressionally prescribed prerequisites to receipt of federal matching funds. Plaintiffs further contended that they were being denied equal protection of the laws, as guaranteed by the Fourteenth Amendment.

The federal statute in question is paragraph (23) of section 402(a) of the Social Security Act (Act), 42 U.S.C. § 602(a) (23), added by section 213(b) of the Social Security Amendments of 1967, 81 Stat. 821, 898, reading as follows:

"; and (23) provide that by July 1, 1969, the amounts used by the State to determine the needs of individuals will have been adjusted to reflect fully changes in living costs since such amounts were established, and any maximums that the State imposes on the amount of aid paid to families will have been proportionately adjusted."¹

Plaintiffs predicated district court jurisdiction on 28 U.S.C. § 1331 (federal question), 28 U.S.C. § 1337 (regulation of commerce and antitrust regulations), and 28 U.S.C. § 1343 (civil rights actions). Since plaintiffs sought to restrain the enforcement of section 11450(a) of the California Welfare and Institutions Code² on federal constitutional grounds, "to the extent that it denies plaintiffs * * * annual cost of living increases in their welfare payments * * *" plaintiffs asked that a three-judge district court be convened pursuant to 28 U.S.C. § 2284(1). A three-judge court was designated on September 24, 1969.

Opposing counsel thereafter stipulated that the district judge in whose court the suit was instituted might proceed to decide the non-constitutional claims concerning the state's alleged non-compliance with section 402(a) (23) of the Act, and that the determination of the constitutional claims by the three-judge court should be held in abeyance. The single district judge accepted the stipulation and so ordered. References hereinafter to the district court refer to this single-judge district court unless otherwise indicated.

A hearing before the district court was held on September 10, 1970, upon plaintiffs' motion for partial summary judgment and a preliminary injunction. As a result of this hearing that court rendered a partial summary judgment on September 11, 1970, which is summarized in the margin.³ The matter was continued to October 29, 1970, to allow defendant to demonstrate his compliance with the terms of this judgment and to permit determination of the validity, under the federal law, of any proposal that defendant might submit.

On the latter date, defendant filed with the district court a document entitled "Compliance with Partial Summary Judgment of September 11, 1970." In this document defendant recounted several recent developments pertaining to the problem, and described the proposed emergency state regulations designed to meet federal statutory requirements. Under these regulations the need standards would be adjusted, and the maximum participating base provided in California Welfare and Institutions Code, § 11450(a) would be increased 21.4 percent to comply with section 402(a) (23) of the Act, and grants would be ratably reduced to reflect a payment level of seventy-four percent of total allowable need, with provision for further downward adjustments, in order to comply with state fiscal and budgetary realities. Defendant stated in this document that the emergency regulations would be adopted on or before November 10, 1970, to be effective as of October 1, 1970.

The further hearing was held on October 29, 1970, as scheduled. As a result, the order of September 11, 1970, was amended on November 17, 1970 as set out in the margin.⁴

In the order of November 17, 1970, the district court included a recital, consonant with the interlocutory appeal statute (28 U.S.C. § 1292(b)), that paragraph 5 of the November 17, 1970 order (see note 4, supra), involves a controlling question of law concerning which there is a substantial ground for differences of opinion and that an immediate appeal from the judgment may materially advance the ultimate termination of the litigation. The district court refused defendant's request for a stay.

Defendant immediately applied to this court for permission to appeal from the amended partial summary judgment, and for a stay of that judgment pending disposition of such appeal. Another panel of this court granted both motions and set up an expedited briefing schedule. Thus, to date no increased payments, pursuant to a district court order, have been made. Nor have any increased payments been made pursuant to the emergency regulations above mentioned. Their effect was stayed in state court proceedings, pending decision in California Welfare Rights Organization v. Carleson, and, in the interim, the regulations expired by their own terms.

The appeal from the November 17 order is the appeal that is now before us. However, we take judicial notice of a number of developments since the taking of this appeal, called to our attention by the parties, since such circumstances may affect our consideration of the various issues presented. In chronological order, these developments are as follows:

1. On November 24, 1970, defendant filed an affidavit and supporting documents said to demonstrate compliance with the order of November 17, 1970, and asked the court to enter a final declaratory judgment to that effect.⁵

2. On December 18, 1970, the district court amended its order of November 17, 1970, to enlarge the sixty-day period for compliance to March 1, 1971, and to set for hearing, on March 12, 1971, the question of the validity of defendant\'s regulations under federal law.

3. On March 25, 1971, the California Supreme Court decided California Welfare Rights Organization v. Carleson, 4 Cal.3rd 445, 93 Cal.Rptr. 758, 482 P.2d 670 (1971). In this decision the California Supreme Court held that defendant Carleson has the authority to promulgate a regulation increasing the dollar maximums 21.4 percent. That court further held, however, that defendant had no authority to determine the level of benefits to be paid by adopting a regulation incorporating a percentage reduction in the standard of need, retroactive or otherwise, without state legislative approval, and, absent the approval of other state officials, defendant had no authority to exceed his budget in incurring the increased cost of maintaining the dollar maximum system.

4. On April 6, 1971, plaintiffs moved in this court for an order vacating the stay and dismissing the appeal, in view of the California Supreme Court decision and other developments.

5. On April 16, 1971, the Administrator of the U. S. Department of Health, Education and Welfare (HEW) issued his decision holding that California had failed to adjust its maximums on assistance payments to AFDC recipients to satisfy the requirements of section 402(a) (23) of the Act, 42 U.S.C. § 602(a) (23). As a sanction for such nonconformity, the Administrator ordered that, effective July 1, 1971, all federal financial assistance for the California AFDC program be withheld until such time as the California AFDC plan conforms to the requirements of section 402(a) (23) of the Act.

6. On April 19, 1971, the district court entered a memorandum and order reciting that, in certifying the question of immediate increases to this court for interlocutory appeal, it had no intention of certifying the question of that court\'s power to enjoin the receipt of federal funds. However, the court pointed out, the certification read "an immediate appeal from the judgment may materially advance the ultimate termination of the litigation," and the stay issued by this court accordingly stayed enforcement of the entire partial summary judgment of November 17, 1970. For this reason, the district court determined that it was bound by the scope of the stay order and could not proceed to enforce the decretal provision restraining receipt of federal funds.

7. On April 20, 1971, plaintiffs requested this court to modify ex parte, the stay order, so as to stay only paragraph 5 of the district court order, rather than the entire order.⁶

On this appeal, defendant first questions the jurisdiction of the single-judge district court, contending that the matters decided in the order of November 17, 1970, should have been submitted to the three-judge court which had been convened pursuant to 28 U.S.C. § 2284....