Grunfeder v. Heckler
| Decision Date | 26 November 1984 |
| Docket Number | No. 82-5751,82-5751 |
| Citation | 748 F.2d 503 |
| Parties | Felicia GRUNFEDER, Plaintiff, Appellant, v. Margaret HECKLER, Secretary of Health and Human Services, Defendant, Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Terry B. Friedman, Elyse S. Kline, Jana Zimmer, Josh A. Lazar, Bet Tzedek, Legal Service, Los Angeles, Cal., for plaintiff, appellant.
James R. Arnold, Asst. U.S. Atty., Los Angeles, Cal., Dennis J. Mulshine, Asst. Reg. Atty., San Francisco, Cal., Lois Waldman, New York City, for defendant, appellee.
An Appeal from the United States District Court for the Central District of California.
Before GOODWIN, WALLACE, ANDERSON, SCHROEDER, PREGERSON, ALARCON, FERGUSON, NELSON, CANBY, BOOCHEVER, and REINHARDT, Circuit Judges.
INTRODUCTION
We took this case en banc to decide the narrow question whether reparations payments that the German Federal Republic makes to survivors of the Holocaust constitute countable "income" in determining eligibility for supplemental security income (SSI) under the Social Security Act (the Act), 42 U.S.C. Secs. 1381-1383c (1976 & Supp. IV 1980). Congress has not addressed this precise question. Neither the Act, its legislative history, nor its implementing regulations explicitly mention German reparations payments made pursuant to the Federal Law for the Compensation of Victims of National Socialist Persecution of June 28, 1956. 1 For the reasons stated below, we reverse the Social Security Administration's (SSA) determination that German reparations payments are income for the purpose of determining SSI eligibility.
Felicia Grunfeder, born a year before the Germans invaded Poland in World War II, was confined with her family in the Warsaw ghetto. She escaped in a coffin lifted over the fence separating the Jewish cemetery from the Polish cemetery. Grunfeder then lived with a Polish family in the Polish section of Warsaw until the Nazis imprisoned them in the Lager Rote-Rose concentration camp. Liberated by the Americans at the end of the war, Grunfeder was reunited with her mother. They both relocated to the United States in 1949. Grunfeder's father and the other members of her family perished at the hands of the Nazis.
Grunfeder developed severe psychological problems as a result of her experiences during the war. She petitioned the German government under the German Restitution Act and started receiving monthly reparations payments of 159 DM (approximately $228) in 1968. Because the psychological effects she suffers have been disabling, Grunfeder applied for and began receiving SSI payments of $119 in 1974. In 1980, the SSA learned that Grunfeder was receiving German reparations payments and terminated her SSI benefits on the ground that the reparations payments constituted "unearned income" under the Act and made her ineligible for SSI benefits.
The Secretary denied Grunfeder's motion for reconsideration, an administrative law judge denied her appeal, and the Appeals
Council denied her request for a review of the ALJ's decision. Exercising jurisdiction under 42 U.S.C. Sec. 405(g) (1976 & Supp. IV 1980), the district court dismissed Grunfeder's complaint seeking review of the ALJ's decision. Grunfeder now appeals to this court.
Our court has "carefully examined [the question] when the receipt of an item of value by an SSI beneficiary constitutes income which is actually available to meet the beneficiary's basic needs." Summy v. Schweiker, 688 F.2d 1233, 1235 (9th Cir.1982); see Whaley v. Schweiker, 663 F.2d 871, 873-75 (9th Cir.1981).
In Whaley, we overturned the determination of the Secretary of Health and Human Services that the amount of increased pension benefits the Veterans Administration pays a veteran for the support of his dependent children constitutes income in determining SSI eligibility. 663 F.2d at 875. We dismissed the Secretary's argument that because the veteran could use the dependent's portion for his own needs, that amount fell within the SSA's definition of income as "anything [an individual can use] to meet [his] basic needs for food, clothing, or shelter." 20 C.F.R. Sec. 416.1102(a) (1981). In determining the proper accommodation between the Veterans Administration regulations and the SSI provisions, we noted that "[t]he interpretation of the Veterans Administration regulations by the Secretary of Health and Human Services, a department unrelated to the Veterans Administration,] is not entitled to deference." 663 F.2d at 873.
Likewise, the Secretary's interpretation of the German Restitution Act and the intended uses of reparations payments is entitled to little deference. Although we generally give some deference to an implementing agency's interpretation of a statute,
where, as here, the review is not of a question of fact, but of a judgment as to the proper balance to be struck between conflicting interests, '[t]he deference owed ... cannot be allowed to slip into a judicial inertia which results in the unauthorized assumption by an agency of major policy decisions properly made by Congress.'
NLRB v. Brown, 380 U.S. 278, 292, 85 S.Ct. 980, 988, 13 L.Ed.2d 839 (1965) (quoting American Ship Building Co. v. NLRB, 380 U.S. 300, 318, 85 S.Ct. 955, 967, 13 L.Ed.2d 855 (1965)).
In determining that the definition of income for SSI eligibility purposes includes German reparations payments, the SSA implicitly balanced our Government's interest in allocating a limited pool of funds to support the country's aged, blind, and disabled against our Government's interest in restoring a semblance of normal existence to Holocaust survivors who live in the United States. This type of policy decision, which implicates foreign affairs, is outside the Secretary's expertise.
Congress has vested reviewing courts with the duty to "decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action." 5 U.S.C. Sec. 706 (1976). Courts are the final authority on questions of statutory construction, Tulalip Tribes of Washington v. FERC, 732 F.2d 1451, 1454 (9th Cir.1984), particularly in areas where, as here, the construction requires consideration of broad concerns beyond the agency's expertise. As we construe the Act's relevant SSI provisions, 42 U.S.C. Secs. 1381-1383c, German reparations payments are not includable as income. Therefore, we find that the Secretary's contrary determination is "not in accordance with law," 5 U.S.C. Sec. 706(2)(A), and we set it aside.
The SSI program is designed to supplement the income of needy aged, blind, or disabled persons. See 42 U.S.C. Sec. 1381 (1976). An individual is eligible for SSI benefits if his annual "income" is below $1,752 and his "resources" are less than $1,500. Id. Sec. 1382(a)(1). Congress defines The SSA, however, has expansively defined "income" as "the receipt by an individual of any property ... which he can apply ... to meeting his basic needs for food, clothing, and shelter." 20 C.F.R. Sec. 416.1102(a) (1980). 2 The SSA excludes only those receipts listed in other sections of the regulations. See, e.g., 20 C.F.R. Secs. 416.1105-416.1112, 416.1145-416.1175 (1980). On the basis of this administrative definition and the fact that German reparations payments are not specifically listed as an exclusion, the Secretary argues that reparations payments are countable income.
"income" for SSI purposes in Sec. 1382a as both "earned" and "unearned" income. Congress specifies that earned income means "only" wages, net earnings from self-employment, refunds of Federal income tax, and remuneration for services performed in a work activities center. Id. Sec. 1382a(a)(1) (Supp. IV 1980). In contrast, Congress generally describes unearned income as "all other income," including seven categories of receipts. Id. Sec. 1382a(a)(2)(A)-(F) (1976). Although Congress lists 12 types of receipts that "shall be excluded" from income, id. Sec. 1382a(b) (1976 & Supp. IV 1980), Congress never defines the term "income" itself and leaves considerable flexibility in the statutory criteria for eligibility.
As stated earlier, Congress has not explicitly addressed the narrow question whether German reparations payments are income for the purposes of determining SSI eligibility. To ascertain Congress's intent on this question, we first look to the history of how Congress has treated Holocaust survivors. We then examine how Congress and the SSA have treated analogous payments. Finally, we employ the doctrine of international comity to aid us in determining congressional intent.
We first examine the question presented by this case, and the pertinent SSI provisions, in the light of federal policy according special consideration to victims of the Holocaust.
In 1948, Congress welcomed the Holocaust survivors to the United States by excluding them from immigration quota requirements. See Displaced Persons Act of 1948, 50 U.S.C.App. Secs. 1951-1965 (1952), amended by 50 U.S.C.App. Secs. 1951-1965 (1958), omitted at 50 U.S.C.App. Secs. 1951-1965 (1976).
Even before Congress addressed the issue of taxing German reparations payments, the Internal Revenue Service (IRS) had consistently ruled that reparations payments did not constitute "income" because they "are in the nature of reimbursement for the deprivation of civil or personal rights." Rev.Rul. 58-500, 1958-2 C.B. 21; see also Rev.Rul. 56-518, 1956-2 C.B. 25 (using same language). Congress subsequently confirmed the IRS's assumption that Congress intended to exclude German reparations payments from taxable income because of their penitent purpose and restitutionary character. In 1954, the Senate ratified the Convention Between the Federal Republic of Germany and the United States of...
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