Hanes v. Celebrezze

• Decision Date: 23 September 1964
• Docket Number: No. 9275.,9275.
• Parties: William E. HANES, Appellant, v. Anthony J. CELEBREZZE, Secretary of Health, Education and Welfare, Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

337 F.2d 209 (1964)

William E. HANES, Appellant, v. Anthony J. CELEBREZZE, Secretary of Health, Education and Welfare, Appellee.

No. 9275.

United States Court of Appeals Fourth Circuit.

Argued April 21, 1964.

Decided September 23, 1964.

COPYRIGHT MATERIAL OMITTED

Frank C. Maloney, III, Richmond, Va. (Allen, Allen, Allen & Allen, Richmond, Va., on brief), for appellant.

Peter B. Edelman, Attorney, Department of Justice (John W. Douglas, Asst. Atty. Gen., and Sherman L. Cohn, Attorney, Department of Justice, and C. Vernon Spratley, Jr., U. S. Atty., on brief), for appellee.

Before SOBELOFF, Chief Judge, and BOREMAN and BRYAN, Circuit Judges.

BOREMAN, Circuit Judge.

William E. Hanes brought this action in the District Court under section 205 (g) of the Social Security Act (42 U.S. C.A. § 405(g)) to obtain judicial review of the decision of the Secretary of Health, Education and Welfare (hereinafter Secretary) denying his application for the establishment of a period of disability under section 216(i) (1) of the Act (42 U.S.C.A. § 416(i) (1)) and for disability benefits for himself and his children under section 223 (42 U.S.C.A. § 423). Following oral argument and the submission of briefs on behalf of both parties, the District Court granted defendant's motion for summary judgment, thus sustaining the Secretary's decision.

Actually, the ultimate issue here is the same as that before the District Court, namely, whether the Secretary's determination that claimant was not disabled within the meaning of the Act¹ is supported by substantial evidence. Thomas v. Celebrezze, 331 F.2d 541 (4 Cir. 1964); Farley v. Celebrezze, 315 F.2d 704 (3 Cir. 1963); Ward v. Celebrezze, 311 F.2d 115 (5 Cir. 1962). We conclude that the court erred in granting the motion for summary judgment.

Hanes was forty-six years old at the time he filed the application. It is shown by the record that he had completed six years of school when, at age fourteen, he left school to take a job in a paper box factory where he worked for twelve years as a helper and machine operator. Thereafter he worked for a time as a truck driver for the City of Richmond, Virginia, and in 1941 was appointed to the Richmond Police Department. On May 1, 1959, he was struck from behind by an automobile as he was directing traffic in the performance of his duties as a police officer and sustained numerous injuries over various parts of his body in addition to severe internal injuries. He was hospitalized for eighty-nine days and during much of that time his condition was critical. On the day after his admission to the hospital, he underwent an operation for the resection of a gangrenous segment of the terminal ileum and end-to-end anastomosis. Following this operation his condition worsened and one week later a transverse ileocolostomy was performed and a partial dehiscence of the wound from the previous operation was repaired. Because of continued internal bleeding, a third operation was performed on May 27, 1959, and a perforated stress ulcer of the stomach was repaired. Although this operation was successful, there was further bleeding caused by multiple stress ulcers and he had edema and cardiac signs indicating some degree of heart failure. Thereafter, a severe abdominal wound infection developed which was not completely cured for several months. During the period of his hospitalization he suffered from phlebitis, jaundice, slight pneumonitis, diarrhea and other ailments. An orthopedic examination revealed a separation of the joint at his left shoulder.

Hanes was discharged from the hospital on July 27, 1959. In October 1959 he was retired from the Richmond Police Department and, at the time of the hearing before the examiner, was receiving a monthly retirement pension of approximately $243.00. Despite his continuing physical impairments, as hereinafter described, he began working in January 1961 at the Ashland Memorial Building which is located two blocks from his home in Ashland, Virginia, and used by various organizations for meetings and other functions. Claimant's job with respect thereto was described by the hearing examiner as follows:

"* * * The claimant has the key to the building. He opens the building when necessary, turns on the lights, and in season, turns up the thermostat for heat. At the close of the meeting the claimant checks the room to see that it has been properly taken care of, turns off the lights, turns down the heat, and locks the building. If any repairs are necessary the claimant notifies the proper authorities. During the summer the claimant opened the doors at about eight-thirty in the morning only on Mondays and returned at about five-thirty to lock up. During the winter months there are about twelve meetings a month. He generally opens the place at about seven-thirty in the evening then goes home. He returns at about ten-thirty to turn off the lights, heat, checks the place, and locks up. * * *"

Hanes testified that his work required only one or two hours per week during the summer and eight to ten hours per week during busy weeks in the winter. He further testified that "a good part of the time" he was unable to do the work and his duties were performed by his wife or son. For this work he was receiving $125.00 per month.

Claimant first made application for a period of disability and disability benefits in November of 1959. His claim was denied in March 1960 and on October 20, 1960, he filed a second application which was prior to his employment at Ashland Memorial. This application was also administratively denied and he was granted a requested hearing before an examiner. After considering the testimony of Hanes and that of a physician who appeared on his behalf, together with a number of medical reports, the examiner concluded that "the claimant's overall ability has not been so seriously impaired * * * as to make him continuously unable to engage in any substantial gainful activity." In support of his conclusion that the claimant was able to engage in light sedentary work, the examiner cited several industrial and governmental publications listing the types of jobs held by physically handicapped persons. Review by the Appeals Council was refused and the examiner's decision became the final decision of the Secretary.

The question presented by the circumstances here distinguishes this case from any this court has heretofore considered. In view of the extensive medical evidence with respect to the degree of claimant's impairments and his own testimony as to the extent to which his activities are limited, we would have no difficulty in holding that the examiner's decision is unsupported by the record were it not for the fact that claimant is receiving $125.00 per month from Ashland Memorial. The precise question, then, to be resolved is whether the evidence of these earnings constitutes substantial evidence to support the Secretary's decision. Although the District Court expressed the view that "it is difficult to believe that he Hanes could engage in substantial gainful activity other than the job which he has at the War Memorial Building in Ashland or in work of a similar nature * * *," it nevertheless concluded that Hanes' earnings from that job constituted substantial evidence upon which the Secretary could base his decision. The court apparently felt that such conclusion was compelled by a departmental regulation (20 C.F.R. § 404.1534(b)) promulgated by the Secretary which provides:

"An individual\'s earnings from work activities averaging in excess of $100 a month shall be deemed to demonstrate his ability to engage in substantial gainful activity in the absence of evidence to the contrary."

After noting that the regulation is neither unreasonable nor inconsistent with the statute, the lower court stated:

"The regulation provides that earnings of $100 a month shall be deemed to demonstrate the claimant\'s ability to engage in substantial gainful activities `in the absence of evidence to the contrary.\' The Court finds no evidence to the contrary which removes this case from the application of the regulation. The Secretary\'s determination that the plaintiff was not disabled within the meaning of the Act is supported by substantial evidence. * * *"

It is claimant's position that this regulation is inconsistent with the provisions of the Social Security Act and that in the adoption and promulgation thereof the Secretary exceeded the authority granted by Congress.² However, we need not decide whether, if given the interpretation which the District Court apparently placed upon it, the regulation would be valid. In our view, the court below erred in ascribing controlling significance to the evidence of claimant's earnings.

We are not aware of any other cases which have construed the regulation involved here.³ Significantly, the regulation does not say that an individual who earns in excess of one hundred dollars a month is engaged in substantial gainful activity; it merely creates an inference, in the absence of evidence to the contrary, that one who earns monthly in excess of the stated amount is able to engage in substantial gainful activity. As defined in another regulation of the Secretary, "substantial gainful activity is work activity that is both substantial and gainful." 20 C.F.R. § 404.1502(h). See Celebrezze v. Bolas, 316 F.2d 498, 501 (8 Cir. 1963); Roop v. Flemming, 190 F.Supp. 820, 822 (W.D.Va. 1960). And, "substantial work activity involves the performance of significant physical or mental duties, or a combination of both, productive in nature. * * *" 20 C.F.R. § 404.1502(h). The examiner found that claimant's duties are confined to opening and closing the Memorial Building a few times a week, turning on the lights, regulating the heat and, when repairs are necessary, notifying the proper authorities. His actual work requires no more than one or two hours a day, only one day a week during the summer and...