Cerenzia v. Department of Social Sec. of Washington

• Decision Date: 18 June 1943
• Docket Number: 28877.
• Citation: 18 Wn.2d 230,138 P.2d 868
• Parties: CERENZIA v. DEPARTMENT OF SOCIAL SECURITY OF WASHINGTON.
• Court: Washington Supreme Court

138 P.2d 868

18 Wn.2d 230

CERENZIA v. DEPARTMENT OF SOCIAL SECURITY OF WASHINGTON.

No. 28877.

Supreme Court of Washington, En Banc.

June 18, 1943

Proceeding on the application of Pietro Cerenzia for a senior citizen grant. From a judgment reversing the decision of the Director of the Department of Social Security denying the application the Department appeals.

Reversed with directions.

MALLERY and BLAKE, JJ., dissenting.

Appeal from Superior Court, Spokane County; Louis F. Bunge, judge.

Smith Troy, Phil H. Gallagher, Pat Guimont, and Thomas R. Waters all of Olympia, for appellant.

Robertson & Smith, of Spokane, for respondent.

JEFFERS Justice.

In this proceeding, Pietro Cerenzia, for many years a resident of Spokane, Washington, on February 17, 1941, made application to the Spokane county welfare department for a senior citizen grant. This application was rejected by the department, May 19, 1941, on the ground that the applicant possessed a resource in excess of that permitted by law. On June 19 1941, applicant requested a fair hearing, which request was granted, and a hearing was held on August 28, 1941. At the close of this hearing, counsel for the applicant requested that the hearing be left open, in order that he might further investigate the matter.

On March 3, 1942, the hearing was continued and concluded, and on March 12th following, the director of the department of social security entered his findings and decision, wherein he denied the applicant's request for a grant, upon the ground that Mr. Cerenzia was possessed of a resource in excess of that permitted by law, in that he was the vendor under a contract of sale of real property in Spokane county, upon which there was a balance due of eleven hundred dollars, payable at the rate of one hundred dollars per year, with interest on deferred payments at six per cent per annum, which contract had a present cash value of eight hundred dollars.

Applicant appealed from the order of March 12th, to the superior court for Spokane county where the decision of the director was reversed, and the department was directed to award to applicant a senior citizen grant of forty dollars per month, less the sum of one hundred dollars per year and interest at six per cent, to be deducted monthly from the grant, and to take effect as of the date February 17, 1941. The department has appealed from the judgment of the superior court.

The department assigns error on the conclusion reached by the trial court that respondent was eligible for a senior citizen grant when he had resources sufficient to meet his present needs, and in excess of that permitted by law. Error is also assigned upon the conclusion that the court had jurisdiction to fix the amount of assistance to be given respondent; in making the grant payable from February 17, 1941; and in entering judgment for respondent.

It is admitted by the department that respondent would be eligible for a senior citizen grant except for the contract above referred to.

Appellant contends that this salable contract constitutes a resource sufficient to take care of the needs of respondent, and his refusal to so use it makes him ineligible for a grant until he is again in need, as that term is defined by the law.

We quote the following from respondent's brief, as showing his theory: 'To narrow the question down, it would seem proper to determine whether the annual proceeds from applicant's contract would be considered as income or resources. If the latter, then the department may have been technically correct in holding the applicant had resources of greater value than those permitted by the statute, provided the department had authority to compel the applicant to sell the contract at an unconscionable discount. The trial court specifically found that the annual proceeds from the sale of the realty was not a resource under the statute, and that such were devoted to the purchase of foodstuffs for the applicant's family's exclusive use, and as such, was income within the statute.'

We desire at the outset to say, in justice to the trial court, that when this case was heard and decided, the case of Morgan v. Department of Social Security, 14 Wash.2d 156, 127 P.2d 686, had not been decided.

There is no dispute as to the facts in this case. Mr. Cerenzia, who was past sixty-five years of age at the time of making his application for a senior citizen grant, had lived in Spokane for many years. He owned his own home, where he lived with his wife and family. He had formerly owned thirty-five acres of land on Half Moon prairie, in Spokane county, which he had sold for eighteen hundred dollars, on contract, some time Before making his application. He received $250 as a down payment, and the balance was to be paid at the rate of one hundred dollars a year, with six per cent interest on deferred payments.

At the time of the decision of the director, there was still due on this contract eleven hundred dollars. While this matter was pending Before the director, and Before his decision, Mr. Cerenzia had a cash offer of eight hundred dollars for the contract, which he refused to accept, claiming it was too great a discount. When these circumstances were made known to the director at the hearing, he denied Mr. Cerenzia's application, upon the theory, as heretofore stated, that applicant had available to meet his needs resources of the cash value of eight hundred dollars.

The statutes defining income and resources, as used in the act, applicable to senior citizen grants, will be found in chapter 1, Laws of 1941, and in Rem.Supp.1941, §§ 9998-34 et seq. Section 9998-36 defines various terms used in the act, and subsection (g) thereof defines income as follows:

"Income' shall mean regular or recurrent gains in cash or kind, excepting therefrom:

'(1) The value of the use or occupancy of the premises in which the applicant resides.

'(2) Foodstuffs, livestock, fuel, light or water produced by or donated to applicant or applicant's family exclusively for the use of applicant or applicant's family.

'(3) Casual gifts in cash which do not exceed $100 in any one year.

'(4) Casual gifts in kind which do not exceed $100 in any one year.

'(5) The proceeds from the sale of property which is not a resource, provided such proceeds are used for the purchase of property which is not a resource.'

Subsection (h) defines resources as follows:

"Resources' shall mean any property which the applicant owns legally or beneficially, excepting therefrom:

'(1) The ability of relatives or friends of the applicant to contribute to the support of the applicant.

'(2) Insurance policies, the cash surrender value of which does not exceed $500.

'(3) The homestead, home or place of residence of applicant or the spouse of applicant.

'(4) Intangible property or personal property, the cash value of which does not exceed $200.

'(5) The personal effects of the applicant, including clothing, furniture, household equipment and motor vehicle.

'(6) Foodstuffs, livestock, fuel, light or water produced by the applicant, applicant's spouse or family, exclusively for the use of applicant or applicant's family.'

We stated in the Morgan case, supra [14 Wash. 156, 127 P.2d 692]: 'The support of the poor and needy is a recognized public governmental function. If the act by its terms purports to relieve persons not in actual need, it might well be challenged upon constitutional grounds, but while the 'declaration of...