Lester v. Chater

• Decision Date: 09 April 1996
• Docket Number: No. 93-36136,93-36136
• Parties: , Unempl.Ins.Rep. (CCH) P 15229B, 96 Cal. Daily Op. Serv. 2401, 96 Daily Journal D.A.R. 4034 James LESTER, Plaintiff-Appellant, v. Shirley S. CHATER, Commissioner of the Social Security Administration, * Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 821

81 F.3d 821

50 Soc.Sec.Rep.Ser. 536, Unempl.Ins.Rep. (CCH) P 15229B,

96 Cal. Daily Op. Serv. 2401,

96 Daily Journal D.A.R. 4034

James LESTER, Plaintiff-Appellant, v. Shirley S. CHATER, Commissioner of the Social Security Administration, ^* Defendant-Appellee.

No. 93-36136.

United States Court of Appeals Ninth Circuit.

Argued and Submitted June 6, 1995.

Decided Nov. 3, 1995.

Amended April 9, 1996.

Ralph Wilborn, Eugene, Oregon, for plaintiff-appellant.

Ben A. Porter, Seattle, Washington, for defendant-appellee.

Appeal from the United States District Court for the District of Oregon, Michael R. Hogan, District Judge, Presiding; No. CV-92-6006-HO.

Before: SCHROEDER, ^** CANBY, and REINHARDT, Circuit Judges.

REINHARDT, Circuit Judge.

James Lester challenges the Commissioner's denial of his application for Social Security disability benefits. He argues that the Commissioner erred in failing to take into account the combined impact of his mental and physical impairments in determining whether his condition "equalled" a listed impairment, in disregarding the opinions of his treating physician and examining psychologist, and in rejecting his hearing testimony. We agree with Lester on each of these points. Because the Commissioner would have been compelled to find him disabled if not for these errors, we reverse and remand for payment of benefits.

I.

Lester injured his back in June 1968 while working as a meatcutter and subsequently underwent two laminectomies. He received disability benefits between 1968 and 1974. After 1974, he worked part-time at various jobs, but ceased working altogether in November 1982 due to his worsening back pain.

Lester reapplied for disability benefits in 1984. This claim was denied after an administrative hearing. The Administrative Law Judge (ALJ) concluded that he was not disabled at any time up to June 21, 1985, the date of the decision. Lester did not seek judicial review of the 1985 decision. However, in March 1988, he filed a third application for benefits. Only the 1988 application is before us on appeal. Lester was last insured for disability benefits on December 31, 1987. Thus, to qualify for disability insurance benefits, he must show that he became disabled on or before that date.

Although the medical record contains materials dating back to the 1970's, our focus is on the period after June 21, 1985 (the date of the ALJ's decision denying Lester's second application for disability benefits). ¹ In April 1985, Darrell T. Weinman, M.D., who was Lester's treating physician at the time, offered the following diagnosis: "mechanical back pain, failed low back surgery syndrome and arachnoiditis of the spinal column." Dr. Weinman stated that Lester was limited to sedentary work and "not likely to improve." Robert J. Strunkel, M.D., who also treated Lester in 1985, agreed that his back pain limited him to sedentary work. In addition, Dr. Strunkel noted that he might be suffering from depression.

Dr. Strunkel referred Lester to Yung K. Kho, M.D., who specializes in the care of patients with chronic pain. Dr. Kho remained the treating physician from October 1986 on. After their initial meeting, Dr. Kho diagnosed Lester's condition as follows: (1) status post lumbar laminectomy, (2) likely post operative arachnordiculopathy, with (3) chronic myofascial pain syndrome, and (4) suspected pre-existing personality disorder. In subsequent reports, Dr. Kho noted the existence of both a personality disorder and depression, and prescribed antidepressants. To treat the claimant's back pain, Dr. Kho instituted a program of lumbar injections and physical therapy, which provided some relief. In June 1987, Dr. Kho expressed his opinion that Lester was capable of "some sedentary type of employment." By December 1987, however, Lester was again reporting increasing back pain and, in February 1988, Dr. Kho reported that he was "walking as antalgically as ever" and had not benefitted from recent injections. An MRI revealed degenerative changes in the lumbar spine, without bulging or herniation. In May 1988, Dr. Kho noted that Lester was having difficulty walking more than one-quarter of a mile and was "essentially a back cripple."

On February 1989, Lester was examined by a psychologist, Ron Taylor, Ph.D., who interviewed him and conducted psychological testing. Dr. Taylor diagnosed major depression, recurrent and severe, and a personality disorder, concluding that: "The impression is that this fifty-three-year old man is currently, and probably has been since 1982, possibly medically, and probably psychologically unfit for any kind of suitable and feasible substantial gainful employment." Dr. Taylor further found that the claimant was markedly limited in his ability: (1) to maintain concentration and attention; (2) to perform activities within a schedule, maintain regular attendance, and be punctual; and (3) to complete a normal workday and workweek without interruption from psychological symptoms and to perform at a consistent pace without unreasonable rest periods. He found Lester to be moderately limited in several other work-related areas. ²

After reviewing Dr. Taylor's report, Dr. Kho wrote a report expressing his agreement with Dr. Taylor as to the restrictions on Lester's mental functioning. In addition to the limitations indicated by Dr. Taylor, Dr. Kho determined that Lester was markedly limited in his ability to travel to unfamiliar places or use public transportation and in his ability to set realistic goals or make plans independent of others. Dr. Kho estimated that all Lester's functional restrictions had existed since 1982.

At the administrative hearing, conducted in April 1989, Lester testified that he was unable to engage in chores such as vacuuming, mopping, mowing, or washing dishes. He also testified that his daily activities were extremely limited, and that he stayed in bed most of the time.

At the request of the ALJ, Michael Sasser, M.D., a nonexamining psychiatrist, appeared at the hearing to testify as to Lester's mental status. Dr. Sasser first expressed disagreement with Dr. Taylor's interpretation of the psychological testing results. According to Dr. Sasser, Lester had no medically determinable mental impairment that met or equalled the criteria contained in the listing for "Affective Disorders." 20 C.F.R. Pt. 404, Subpt. P, App. 1, § 12.04 ("Listing § 12.04"). On cross-examination, however, Dr. Sasser acknowledged that Lester suffers from "chronic pain syndrome" and that Lester's testimony, if credited, would demonstrate marked limitations in his activities of daily living.

A vocational expert, Victor P. Mihayl, also testified at the administrative hearing. The ALJ inquired whether a person of Lester's education and background who was limited to sedentary work with a sit/stand option and whose pain had a "moderate effect on his concentration and attention and ability to interact with the general public" would be able to perform any type of work. The vocational expert testified that, while such a claimant could not return to Lester's past work, he could perform the jobs of light vehicle dispatcher, general clerk, or customer service representative.

The ALJ subsequently issued a decision finding that Lester was capable of performing the three types of jobs mentioned by the vocational expert and, therefore, that he was not disabled. The ALJ made a general finding that Lester's testimony was not credible. Relying on the testimony of Dr. Sasser and Mr. Mihayl, and rejecting the opinion of Dr. Taylor, the ALJ concluded that Lester had no medically determinable mental impairment.

Lester requested review of the ALJ's decision by the Appeals Council, submitting additional evidence regarding his mental impairment. The Appeals Council reversed and remanded for a new administrative hearing, concluding that the ALJ had erred in his consideration of the claimed mental impairment. The case was assigned to a different ALJ with instructions that the new evidence be considered. On remand, Lester waived his right to a second hearing and requested that the new ALJ issue a decision on the record, including the new evidence. Again, Lester was found not disabled. Although the ALJ concluded that Lester did have medically determinable mental impairments--specifically, depression and a personality disorder--she rejected the opinion of Lester's treating physician and examining psychologist as to the severity of the functional restrictions resulting from this impairment. According to the ALJ, Lester's mental impairments resulted in only "moderate" limitations on his functional capacity. This time, the Appeals Council affirmed the ALJ's decision, making it the final determination of the Commissioner. The district court granted summary judgment for the Commissioner.

II.

As a threshold matter, we consider whether res judicata precludes Lester from challenging the Commissioner's decision. We conclude that it does not.

In rejecting Lester's 1984 claim for disability benefits, the ALJ concluded that he was not disabled at any time up to June 21, 1985, the date of his decision. Lester's 1984 claim did not allege that he was disabled by a mental impairment, and the Commissioner did not consider any evidence pertaining to his mental impairment in denying this claim. However, when Lester reapplied for benefits in 1988, he did allege that he was disabled, at least in part, as a result of depression. In denying his 1988 application, the ALJ concluded that there was no basis for reopening the decision denying Lester's 1984 claim, and applied res judicata to the period up to June 21, 1985.

Lester does not challenge the Commissioner's application of res judicata up to the date of the earlier decision. The question is whether that doctrine bars his disability claim for any subsequent period. As we have previously stated, the principle of res judicata should not be rigidly applied in...