Jackson v. Jackson, 87-2183

• Citation: 857 F.2d 951
• Decision Date: 22 September 1988
• Docket Number: No. 87-2183,87-2183
• Parties: Kathy JACKSON, Plaintiff-Appellant, v. Larry D. JACKSON, Commissioner, Virginia Department of Social Services, and Richard E. Lyng, Secretary, U.S. Department of Agriculture, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 951

857 F.2d 951

Kathy JACKSON, Plaintiff-Appellant, v. Larry D. JACKSON, Commissioner, Virginia Department of Social Services and Richard E. Lyng, Secretary, U.S. Department of Agriculture Defendants-Appellees.

No. 87-2183.

United States Court of Appeals Fourth Circuit.

Argued May 2, 1988.

Decided Sept. 22, 1988.

Martin Wegbreit (Client Centered Legal Services of Southwest Virginia, Inc., Castlewood, Va., on brief), for plaintiff-appellant.

Thomas J. Czelusta, Asst. Atty. Gen. (Mary Sue Terry, Atty. Gen., Richmond, Va., on brief) for defendants-appellees.

Before CHAPMAN and WILKINS, Circuit Judges, and GORDON, Senior United States District Judge for the Middle District of North Carolina, sitting by designation.

GORDON, Senior District Judge:

In March of 1987, the Dickenson County Department of Social Services terminated Kathy Jackson's benefits under the food stamp program. Jackson appealed this decision to the State Hearing Authority of the Virginia Department of Social Services and asked to receive food stamp benefits pending appeal. The Virginia Department of Social Services refused Jackson's request to receive benefits pending appeal and, thereafter, affirmed the termination of food stamp benefits. Jackson filed suit challenging the substantive decision to deny food stamp benefits and the procedural decision to deny benefits pending appeal. The United States District Court for the Western District of Virginia upheld the actions of the Department of Social Services. Jackson now appeals the district court decision on statutory and constitutional grounds. Finding no merit to Jackson's arguments, we affirm.

I.

Sometime prior to 1981, Eddie Jackson received a mobile home and 0.34 acres of land from his father. In 1981, Eddie Jackson deeded this property to his minor son, Henry Jackson. Presumably, Eddie Jackson made this conveyance to thwart any attempts creditors might make to obtain the property.

From March of 1981 until January of 1986, Eddie and Kathy Jackson, along with their three children, lived on Henry's property. During that time, the family received food stamp benefits. In January of 1986, Kathy Jackson separated from Eddie Jackson. Kathy and the three children relocated; Eddie continued to live on Henry's property. Shortly thereafter Kathy applied for food stamp benefits and, in May of 1986, Kathy and the three children began receiving food stamps.

II.

Congress enacted the food stamp program "to safeguard the health and well being of the Nation's population by raising the levels of nutrition among low-income households." 7 U.S.C. Sec. 2011 (1988); 7 C.F.R. Sec. 271.1(a) (1987). State agencies administer the food stamp program. 7 C.F.R. Sec. 271.4(a) (1987).

The food stamp program provides assistance to "households." See 7 C.F.R. Sec. 273.1 (1987). A household desiring food stamp benefits files a completed and signed application with the applicable state agency. 7 C.F.R. Sec. 273.2 (1987). In processing the application, the state agency interviews the household or its authorized representative and verifies certain information on the application. 7 C.F.R. Sec. 273.2(d)-(f) (1987). If any material part of the information the applicant provides is incorrect, the agency may deny the applicant's request for food stamps. 7 C.F.R. Sec. 273.2(b)(1) (1987).

Congress limited participation in the food stamp program "to those households whose incomes and other financial resources ... are determined to be a substantial limiting factor in permitting them to obtain a more nutritious diet." 7 U.S.C. Sec. 2014(a) (1988). The rules regarding eligibility to participate in the food stamp program include "[r]esource eligibility standards," 7 C.F.R. Sec. 273.8 (1987), and the statute and regulations provide that in order for a household to receive food stamp benefits, "[t]he maximum allowable resources, including both liquid and nonliquid assets, of all members of the household shall not exceed $2,000.00." 7 U.S.C. Sec. 2014(g) (1988); 7 C.F.R. Sec. 273.8(b) (1987). The regulations define resources broadly, and the definition specifically includes "buildings," "land," and "any other property." 7 C.F.R. Sec. 273.8(c) (1987). The regulations then specifically enumerate the "only" resources excluded from the "resources" calculation.

The regulations require the applicable state agency to "establish a definite period of time within which a household shall be eligible to receive [food stamp] benefits." 7 C.F.R. Sec. 273.10(f) (1987). At the end of this "certification period, entitlement to food stamp benefits ends. Further eligibility shall be established only upon a recertification based upon a newly completed application, an interview, and verification." Id. The regulations require the state agency to "provide each household with a notice of expiration ... prior to the start of the last month of the household's certification period," 7 C.F.R. Sec. 273.14(b)(1) (1987), and to "approve or deny timely applications for recertification prior to the end of the household's current certification period." 7 C.F.R. Sec. 273.14(a)(1) (1987).

If the state agency denies the application for recertification, the agency must provide the household with a "notice of denial." 7 C.F.R. Sec. 273.10(g)(2) (1987). A notice of denial must explain "the basis for the denial, the household's right to request a fair hearing, the telephone number of the food stamp office, and, if possible, the name of the person to contact for additional information." 7 C.F.R. Sec. 273.10(g)(1)(ii) (1987).

A household "aggrieved by any action of the State agency which affects the participation of the household [sic] in the Program" may request a "fair hearing." 7 C.F.R. Sec. 273.15(a) (1987). In essence, this fair hearing is an administrative appeals procedure. If the houshold requests a fair hearing within the period of time provided in the notice of denial, and the household's certification period has not expired, the agency must allow the household to continue to receive benefits until the end of the original certification period. 7 C.F.R. Sec. 273.15(k)(1) (1987). The regulations, however, forbid the state agency to "continue benefits ... beyond the end of the certification period unless the household has been recertified." 7 C.F.R. Secs. 273.14(a)(4) and 273.15(k)(2)(i) (1987).

III.

In January of 1987, the Dickenson County Department of Social Services notified Kathy Jackson that her food stamp certification period was about to expire. Thereafter, Jackson submitted an application for recertification and attended a recertification interview. At this interview, Jackson disclosed, for the first time, that her minor son Henry owned real property worth more than $2,000.00. On March 5, 1987, the Department of Social Services notified Jackson that her "application for food stamps dated February 13, 1987, has been denied because such property exceeded the allowable resource limit."

On March 13, 1987, Jackson requested a "fair hearing" concerning the denial of food stamps and requested the continuation of her food stamp benefits pending the hearing. The Virginia Department of Social Services denied the request for benefits during the appeal process, and Jackson filed a complaint against the Department of Social Services, on March 23, 1987, challenging this decision. Later, on April 22, 1987, the Department of Social Services conducted the fair hearing and found Jackson ineligible to participate in the food stamp program because Henry Jackson's ownership of real property placed the family over the food stamp resource limit. After this ruling, Jackson filed an amended complaint challenging the substantive decision to deny food stamp benefits as well as the procedural decision to deny benefits during the appeal process. On October 23, 1987, the United States District Court for the Western District of Virginia granted summary judgment in favor of the defendants. Jackson appeals.

IV.

The regulations provide an exclusion from resources for assets which are "not accessible" to a household, and Jackson argues that her son's property is "not accessible." In support of her argument, Jackson notes that, under Virginia law, she must initiate a court action to attempt to sell land owned by minor. If the court approves a sale, the court retains control over the proceeds from the sale. The court then applies the proceeds for "the use and benefit" of the minor. The court may, but need not, pay these proceeds to the minor's parents; Virginia law does not require the court to pay the proceeds to the minor's parents. Jackson thus argues that her son's property is "not accessible" because she cannot take any action that will guarantee that she will receive the proceeds from the sale of the property. The court disagrees with Jackson's construction of "not accessible" and finds that Henry Jackson's property is not an excludable resource.

The regulations provide the following exclusion from resources:

(8) Resources having a cash value which is not accessible to the household, such as but not limited to, irrevocable trust funds, security deposits on rental property or utilities, property in probate, and real property which the household is making a good faith effort to sell at a reasonable price and which has not been sold.

7 C.F.R. Sec. 273.8(e)(8) (1987). In order to understand why Henry Jackson's property is not an excludable resource, one must first recognize that this regulation is not a model of clarity. The regulation fails to provide an overarching definition of when a resource is not accessible. Instead, the regulation provides a nonexclusive list of resources that are not accessible, and state agencies and courts must extrapolate, using the list as a guide, whether a particular unlisted resource is not accessible. Compounding this already difficult task is the fact that the examples of inaccessible resources do not lend themselves to categorization.

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