Parodi v. Merit Systems Protection Bd.

• Decision Date: 25 March 1983
• Docket Number: No. 80-7671,80-7671
• Parties: Irene C. PARODI, Petitioner, v. MERIT SYSTEMS PROTECTION BOARD and Office of Personnel Management, Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 731

690 F.2d 731

Irene C. PARODI, Petitioner, v. MERIT SYSTEMS PROTECTION BOARD and Office of Personnel

Management, Respondents.

No. 80-7671.

United States Court of Appeals, Ninth Circuit.

Argued Feb. 10, 1982.

Submitted April 13, 1982.

Decided Oct. 21, 1982.

As Amended March 25, 1983.

John R. Browne III, argued; John R. Browne III, Paul N. Dubrasich, Browne & Kahn, San Francisco, Cal., on brief, for petitioner.

William Kanter, argued, Russell L. Caplan, William Kanter, Washington, D. C., on brief, for respondents.

Before CHOY, PREGERSON, and POOLE, Circuit Judges.

PREGERSON, Circuit Judge:

Appellant Irene C. Parodi, a federal employee, was transferred to an office in which many other employees smoked. She began experiencing pulmonary difficulties. On her doctor's advice, she took a leave of absence from work. She then applied for employment disability benefits, claiming her reaction to cigarette smoke rendered her disabled. Doctors who examined her on behalf of the government found that she had not suffered physical damage. They did conclude, however, that her hypersensitivity to cigarette smoke prevented her from working in a smoke-filled environment. Appellee Office of Personnel Management (OPM) ruled that her medical condition did not render Parodi disabled within the meaning of the governing statute and denied disability benefits. Appellee Merit Systems Protection Board (MSPB) affirmed the denial.

Parodi appeals, claiming that appellees, in denying her disability benefits, misconstrued the statutory meaning of 'disability.' Appellees answer that this court has no jurisdiction to review this case, or, if this court has jurisdiction, that Parodi was not disabled under the applicable statute.

We conclude that this court has appellate jurisdiction to review appellees' decision and that Parodi was disabled. Accordingly, we reverse and remand for further proceedings.

BACKGROUND

Parodi worked for the Defense Logistics Agency for nearly twelve years. In July 1977, the agency transferred her to a new workplace, located in a room occupied by sixty to seventy people, many of whom smoked.

Immediately after the transfer, Parodi began missing work due to pulmonary complications which included continual phlegm production, chest pains, congestion, and difficulty breathing and speaking. A pulmonary specialist, Dr. Donald Ho, diagnosed her as suffering from 'asthmatic bronchitis with hyper-irritable airways,' and concluded her condition stemmed from her reaction to cigarette smoke. Dr. Ho recommended she take leave from work. She did so and her symptoms subsided. Dr. Ho then recommended she not return to work in a smoke-filled environment. Parodi continued her absence from work and, shortly thereafter, on June 26, 1979, she filed for disability retirement benefits.

Two doctors examined Parodi on behalf of the OPM. Dr. Charles Bass did not perform any objective tests but reported that Parodi did not suffer any short or long term adverse physical effects. Dr. Bass acknowledged that his opinion could change if he saw Parodi's chest x-rays and that Parodi's problem could require 'personnel and environmental control.' Dr. Robert Fallat, in examining Parodi, exposed her to cigarette smoke and within four minutes she suffered acute pulmonary problems including airway irritation, an increase in airway resistance, and a reduction in peakflow rates. Dr. Fallat concluded that Parodi was hypersensitive to cigarette smoke, and recommended she 'not return to employment in the same office where she previously experienced significant symptomatology.' Dr. Fallat also stated that requiring Parodi to work in her previous job would endanger her health.

The OPM reviewed the medical evidence and, on September 27, 1979, concluded that Parodi was not totally disabled 'within the meaning and intent of the Civil Service Retirement Regulations.' Parodi appealed to the MSPB.

In its decision, the MSPB acknowledged the doctors' recommendation that Parodi not return to work in a smoke-filled environment and that her superior officer believed that she could not do her job due to pulmonary problems. The MSPB also recognized that Parodi 'might reasonably be concerned with the probable risk to her future health from working in an environment where exposure to cigarette smoke presents a hazard to all employees, and particularly to herself because of her peculiar physical sensitivity.' Despite these findings, the MSPB concluded that Parodi was not totally disabled and affirmed the OPM decision.

JURISDICTION

Parodi requests that this court review the MSPB's denial of her disability retirement claim. Our review of this denial is governed by several statutes. At the time Parodi filed her claim, the employee retirement statute provided that '[a]n administrative action or order affecting the rights or interests of an individual or of the United States under this subchapter [5 U.S.C. Secs. 8331 et seq.] may be appealed to the Merit Systems Protection Board.' 5 U.S.C. Sec. 8347(d). Another statute provided that persons could appeal decisions of the MSPB to the United States Court of Claims or the United States Court of Appeals. 5 U.S.C. Secs. 7703(a)(1) and (b)(1). Under section 7703, courts must set aside agency actions found to be '(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (2) obtained without procedures required by law, rule or regulation having been followed; or (3) unsupported by substantial evidence.' 5 U.S.C. 7703(c). The retirement statute, 5 U.S.C. Secs. 8331-48, also provided, however, that '[t]he Office [of Personnel Management] shall determine questions of disability and dependency arising under this subchapter. The decisions of the Office concerning these matters are final and conclusive and not subject to review.' 5 U.S.C. Sec. 8347(c). ¹

The question before us is whether this court may review the MSPB's denial of Parodi's claim, and if so, what standard of review should be applied. Parodi argues that this court should review the MSPB decision pursuant to the standard of review set forth in section 7703(c). Appellees contend that section 8347(c), in mandating that OPM decisions concerning disability and dependency 'are final and conclusive and not subject to review,' bars any judicial review of Parodi's claim.

With one exception, discussed below, courts have rejected both these positions. Courts have recognized that the 'conventional 'substantial evidence" standard of review--which Parodi seeks to apply--does not apply to disability determinations because section 8347(c) places a 'special and unusual restriction on judicial examination,' Scroggins v. United States, 397 F.2d 295, 297, 298 (Ct.Cl.), cert. denied, 393 U.S. 952, 89 S.Ct. 376, 21 L.Ed.2d 363 (1968). ²

Courts, have also rejected the contention that section 8347(c) bars all judicial review of OPM disability determinations. That section specifically limits its effect to questions of 'disability and dependency.' Thus, courts have interpreted section 8347(c) as barring judicial review only of the evidentiary basis of determinations concerning disability and dependency. See Scroggins, 397 F.2d at 298, 299. Courts, however, have allowed judicial review in disability cases 'where there has been a substantial departure from important procedural rights, a misconstruction of the governing legislation, or some like error 'going to the heart of the administrative determination." Scroggins, 397 F.2d at 297, quoting Gaines v. United States, 158 Ct.Cl. 497, 502, cert. denied, 371 U.S. 936, 83 S.Ct. 309, 9 L.Ed.2d 271 (1962). See also Polos v. United States, 621 F.2d 385, 391 n.9 (Ct.Cl.1980); Fancher v. United States, 588 F.2d 803, 806 (Ct.Cl.1978); Allen v. United States, 571 F.2d 14, 17 (Ct.Cl.1978); McFarland v. United States, 517 F.2d 938, 942-43 (Ct.Cl.1975), cert. denied, 423 U.S. 1049, 96 S.Ct. 776, 46 L.Ed.2d 638 (1976); McGlasson v. United States, 397 F.2d 303, 307 (Ct.Cl.1968); Smith v. Dulles, 236 F.2d 739, 742 (D.C.Cir.), cert. denied, 352 U.S. 955, 77 S.Ct. 329, 1 L.Ed.2d 244 (1956); Matricciana v. Hampton, 416 F.Supp. 288, 289 (D.Md.1976); Cantrell v. United States, 240 F.Supp. 851, 853 (W.D.S.C.1965), aff'd, 356 F.2d 915 (4th Cir. 1966). ³

Thus, under this so-called Scroggins rule, courts treat section 8347(c) as limiting, rather than barring, judicial review otherwise provided by section 7703(c). While the Scroggins standard of judicial review and the standard of review provided by section 7703(c) are similar--both allow courts to overturn decisions based upon improper procedures or misconstruction of the law--the Scroggins standard of review is narrower. Courts reviewing agency decisions under section 7703(c) overturn decisions not supported by substantial evidence whereas, courts reviewing decisions controlled by section 8347(c), as construed by Scroggins, may not reexamine the evidentiary basis for an agency's disability determination.

This construction of section 8347(c), which limits rather than bars judicial review, is consistent with the presumption favoring judicial review of agency actions. 'Only upon a showing of 'clear and convincing evidence' of a contrary legislative intent should the courts restrict access to judicial review.' Abbott Laboratories v. Gardner, 387 U.S. 136, 141, 87 S.Ct. 1507, 1511, 18 L.Ed.2d 681 (1967), cited in Dunlop v. Bachowski, 421 U.S. 560, 567, 95 S.Ct. 1851, 1857 58, 44 L.Ed.2d 377 (1975). The language of section 8347(c) does not provide clear and convincing evidence of a congressional intent to bar all judicial review of disability determinations. The statute only evinces a congressional intent to bar judicial review of factual questions concerning disability and dependency. ⁴

The Eighth Circuit recently became the first court to reject the Court of Claims' Scroggins rule by holding that courts lack jurisdiction to review voluntary--i.e.,...