Goldman v. Folsom

• Court: U.S. Court of Appeals — Third Circuit
• Writing for the Court: McLAUGHLIN, KALODNER and HASTIE, Circuit
• Citation: Goldman v. Folsom, 246 F.2d 776 (3rd Cir. 1957)
• Decision Date: 02 July 1957
• Docket Number: No. 12088.,12088.
• Parties: Herbert L. GOLDMAN, Administrator of the Estate of Esther B. Goldman, Appellant, v. Marion B. FOLSOM, Secretary of Health, Education and Welfare.

246 F.2d 776 (1957)

Herbert L. GOLDMAN, Administrator of the Estate of Esther B. Goldman, Appellant, v. Marion B. FOLSOM, Secretary of Health, Education and Welfare.

No. 12088.

United States Court of Appeals Third Circuit.

Argued March 19, 1957.

Decided July 2, 1957.

Jerome L. Markovitz, Philadelphia, Pa. (S. Robert Levant, Markovitz, Stern & Shusterman, Philadelphia, Pa., on the brief), for appellant.

Norman C. Henss, Asst. U. S. Atty., Philadelphia, Pa., (W. Wilson White, U. S. Atty., Philadelphia, Pa., on the brief), for appellee.

Before McLAUGHLIN, KALODNER and HASTIE, Circuit Judges.

KALODNER, Circuit Judge.

Was there substantial evidence to support the finding of a Social Security Administration referee that a claimant for Old Age Insurance benefits had not been employed as claimed?

That issue is presented on this appeal from the Order of the District Court for the Eastern District of Pennsylvania granting the motion of the defendant Secretary of Health, Education and Welfare ("Secretary") for summary judgment. In granting the Secretary's motion, the District Court affirmed the final decision of the Social Security Administration that Mrs. Esther Goldman¹ ("claimant") was not an employee of certain corporations owned by her son and did not receive the wages from those corporations which were required to make her eligible for old-age insurance benefits under the Social Security Act.²

The facts may be summarized as follows:

On June 18, 1953, claimant, then aged seventy, filed an application for old-age insurance benefits with the Bureau of Old-Age and Survivors Insurance of the Social Security Administration ("Bureau"). In that application she stated that she had been employed by Charles Murray, Inc., Sandro, Inc., and Regency Clothes, Inc. from October, 1951 until March, 1953. Subsequently, on July 2, 1953, claimant was awarded old-age insurance benefits of $65.00 monthly which were paid to her for the period beginning April, 1953, and continuing through January, 1954.

Payments to claimant were terminated effective February, 1954. The Bureau made its determination that she had acquired no quarters of coverage by reason of the fact that she had not been employed nor had she received wages as she had claimed in her application. The Bureau's determination was based on a report made by its field representative, F. W. Brobyn that claimant had advised him when he called on her on February 18, 1954 that she had not been employed since the 1930's. Thereafter claimant requested and received a hearing before a referee of the Social Security Administration on July 25, 1955, and an adjourned hearing on August 5, 1955. She did not appear personally at these hearings because of her physical condition but was represented by her attorney.

At the July 25th hearing, Dr. Morris Elkin, claimant's physician, Herbert L. Goldman, her son and an officer of the corporations which employed her, Ronald Berman, her former fellow-employee and Jesse Ianni, her long-time friend, testified in claimant's behalf. Affidavit of a certified public accountant and four one-time fellow employees of claimant, as to her employment, were also adduced.

Brobyn testified with respect to his investigation and a statement of June 25, 1954, which he had obtained from the claimant.

At the further hearing on August 5, 1955, Florence Polk, one of the two attesting witnesses to the June 25, 1954, statement, appeared and testified, pursuant to the referee's subpoena. The second attesting witness, Ida Lessner, could not be found.

On September 29, 1955, the referee rendered his decision affirming the Bureau's determination as to the claimant's non-eligibility to benefits on the specific finding that "* * * claimant was not an employee of the three corporations, and did not receive a wage or salary from these corporations. Claimant had no quarters of coverage and was not entitled to old-age insurance benefits."

The request of the claimant for review of the referee's decision was denied on December 28, 1955, by the Appeals Council of the Social Security Administration and it then became a final decision within the meaning of the Social Security Act. Suit for review was then instituted in the District Court which, as earlier stated, granted the Secretary's motion for summary judgment, resulting in the instant appeal.

Section 205(g) of the Social Security Act, as amended³ provides:

"* * * The findings of the Administrator⁴ as to any fact, if supported by substantial evidence, shall be conclusive * * *."

By virtue of the provisions of the section cited as well as the Administrative Procedure Act⁵ we are charged with the duty of ascertaining whether on the record as a whole there is substantial evidence to support the Secretary's findings of fact.⁶ Ferenz v. Folsom, 3 Cir., 1956, 237 F.2d 46.

In discharging that duty we must keep in mind, as adjured by the Supreme Court, that "courts must now assume more responsibility for the reasonableness and fairness" of decisions of federal agencies "than some courts have shown in the past" and "Reviewing courts must be influenced by a feeling that they are not to abdicate the conventional judicial function." Universal Camera Corp. v. National Labor Relations Board, 1951, 340 U.S. 474, 490, 71 S.Ct. 456, 466, 95 L.Ed. 456.

The Secretary concedes that the referee relied upon an oral statement given by the claimant to Brobyn on February 18, 1954, and the signed statement of June 25, 1954⁷ that she had been physically incapacitated during the years of her alleged employment in 1951, 1952 and 1953 and that she had never worked for the corporations in question.

It is clear that the referee based his finding that the claimant was mentally competent at the time she made these statements solely on Brobyn's opinion testimony to that effect.

On that score, Brobyn's testimony disclosed that he saw the claimant on but two occasions — one on February 18, 1954, when he first interviewed her and again on June 25, 1954, when he took her written statement. The first interview took "in excess of one hour" and the second "probably 45 minutes". (P. 86 Transcript of Record.) He observed no "evidence of mental confusion" on the claimant's part.

Brobyn admitted that he did not interrogate any of the three doctors whose names were supplied to him as having treated the claimant. While he did interview her employer's son, he did not check employees as to whether claimant had actually been employed.

In behalf of the claimant, Dr. Elkin testified on direct examination that she had been his patient intermittently for about 12 years; "in 1951 she was all right except that she had minor attacks of hypertension, nervousness" and "other than that she was all right"; that she was employed at his suggestion because he thought it might alleviate her nervous condition; that he knew she had worked for Charles Murray, Inc. and Regency Clothes; that about a year and a half later, which would be about March, 1953, he advised her to stop work because she was "beginning to have lapses of memory; beginning to get fidgety, nervous, stubborn."

Herbert L. Goldman, the claimant's son, president of the three corporations which employed her, testified that in 1950 and 1951 there was "a lot of shrinkage in inventory, and merchandise was being stolen out of the store"; that while the fellow who stole the goods was arrested and convicted, there was only partial reimbursement for the loss by the bonding company; that on the advice of Dr. Elkin that his mother would be better off if she were occupied, he employed her at a salary of $75.00 a week "to watch pilferage"; she would also occasionally answer the phone, sort sales slips, watch the cash register and make herself generally helpful; in March 1953, she ceased employment on the advice of Dr. Elkin; subsequently her condition worsened and in the summer of 1954 she became "abnormal"; "she was physically sick and mentally sick"; that at the time of the hearings she was in a convalescent home because she was unable to take care of herself.

Ianni, claimant's long-time friend, testified that he saw her frequently at work between October, 1951 and March, 1953; that in 1954 she stopped work because "she was confused — she was beginning personally to slip."

Ronald Berman testified that while attending college he was a part-time employee of Charles Murray, Inc. and Regency Clothes, in 1951 and 1952 (the clothing stores operated by the two concerns were situated about a half block from one another); that claimant was a fellow employee — "she was watching the store; watching the help; when people came in sometimes she waited on trade, answered the telephone, etc.; that when he stopped work around Christmas 1952, she was still employed.

Affidavits to similar effect were adduced in testimony of the following fellow employees of claimant: James H. Smith, Helene Schuman, James Rochester and Hyman Snyder. David R. Gettlin, a...