Townley v. Heckler, 70

• Decision Date: 15 November 1984
• Docket Number: No. 70,D,70
• Citation: 748 F.2d 109
• Parties: , Unempl.Ins.Rep. CCH 15,622 Jack P. TOWNLEY, Plaintiff-Appellant, v. Margaret HECKLER, Secretary of the United States Department of Health and Human Services, Defendant-Appellee. ocket 84-6128.
• Court: U.S. Court of Appeals — Second Circuit

Page 109

748 F.2d 109

7 Soc.Sec.Rep.Ser. 236, Unempl.Ins.Rep. CCH 15,622

Jack P. TOWNLEY, Plaintiff-Appellant, v. Margaret HECKLER, Secretary of the United States Department of Health and Human Services, Defendant-Appellee.

No. 70, Docket 84-6128.

United States Court of Appeals Second Circuit.

Submitted Sept. 24, 1984.

Decided Nov. 15, 1984.

Andrew M. Rothstein, Elmira, N.Y., for plaintiff-appellant.

Salvatore R. Martoche, U.S. Atty., W.D.N.Y., Rochester, N.Y. (Frank P. Geraci, Jr., Asst. U.S. Atty., Rochester, N.Y., of counsel), for defendant-appellee.

Before FRIENDLY, MESKILL and PIERCE, Circuit Judges.

PIERCE, Circuit Judge:

This is an appeal from an order of the United States District Court for the Western District of New York, Michael A. Telesca, Judge, affirming the decision of the Secretary of Health and Human Services (Secretary) which denied appellant certain disability benefits. Appellant argues that there is no substantial evidence to support the findings of the Administrative Law Judge (ALJ) that he is not disabled and implicitly alleges that the ALJ applied the incorrect law. Appellant further alleges that the ALJ denied him procedural due process by basing his decision on evidence procured subsequent to the hearing, evidence which he was not permitted to confront and challenge.

We hold that the ALJ denied appellant procedural due process. We also hold that the ALJ applied the incorrect standard in reaching his conclusion that the appellant is not disabled. Consequently, we reverse the order of the district court and remand for further proceedings.

BACKGROUND

On March 25, 1981, appellant Townley filed an application for disability benefits under Sec. 223 of the Social Security Act, as amended, 42 U.S.C. Sec. 423, and for a period of disability under Sec. 216(i) of the Social Appellant Townley is 55 years old and has an eighth grade education; he alleges disability as of September 29, 1980, based upon impairment of his right leg. Townley was hospitalized twice during the fall of 1980, with complaints of pain and numbness and a history of ulcer-like sores on his leg. Five doctors examined appellant and generally agreed that he suffered from chronic thrombophlebitis and severe cellulitis. In addition, they agreed that appellant could not tolerate activities which required sitting with his legs down for more than two hours or standing for extended periods of time.

                Security Act, as amended, 42 U.S.C. Sec. 416(i).  His application was denied, and he applied for reconsideration and a hearing upon review of his claim.  A hearing was held before an Administrative Law Judge (ALJ), who considered the case de novo.    On April 12, 1982, the ALJ affirmed the denial of benefits.  This decision became final when it was affirmed by the Appeals Council on July 16, 1982.  The Secretary's decision was then appealed to the district court, which denied appellant's application for a period of disability and disability insurance benefits.  This appeal followed
                

Prior to the onset of this physical condition, appellant worked as a tractor-trailer driver. This required him to drive approximately three and a half hours at a time, unload trucks, and lift up to one hundred pounds. Appellant testified that, because of his health status, he now is unable to perform his previous work, is limited to fifteen minutes of standing or walking and one-half hour of sitting at a time, and can lift between twenty and twenty-five pounds.

Subsequent to the hearing, to aid in evaluating claimant's eligibility for disability benefits, the ALJ sent written interrogatories (including a hypothetical question) ¹, the medical evidence, and a copy of the administrative record to Donald J. McDonald, a vocational expert for the Department of Health and Human Services. McDonald classified appellant's former truckdriving job as semi-skilled, requiring medium exertional work. In response to the hypothetical question posed by the ALJ, the expert determined that appellant possesses several skills which are transferable to a range of semi-skilled jobs, requiring sedentary or light exertional work. McDonald listed ten jobs which he asserted appellant could perform with these transferable skills and further stated that the identified ten jobs existed in significant numbers in the national economy.

After receiving McDonald's response on December 30, 1981, on January 4, 1982, the ALJ wrote to appellant's attorney and informed the attorney that he believed "the assistance of a vocational expert [was] necessary in order to arrive at a fair decision." While not mentioning that he had already received the expert's response, the ALJ asked appellant's attorney to submit additions or objections to the interrogatories posed to the expert. Appellant's attorney replied by letter dated January 7, 1982 and submitted two suggestions to the ALJ. He requested that the expert be asked to define In the same letter to the ALJ, appellant's attorney requested that he be permitted to cross-examine the expert at a hearing. On March 1, 1982, the ALJ replied that the expert could not attend a hearing for several months, invited further questions, and stated his intention to decide the case on the record.

                the terms "light exertion" and "sedentary exertion" and he requested a modification in the hypothetical question describing appellant's daily activities to reflect the fact that "what we do in the home allows us to do so at our own pace, taking into consideration any limitations imposed upon us by impairments."    The record does not reflect whether these suggestions were sent to the vocational expert
                

By decision dated April 12, 1982, the ALJ found that appellant suffers from a severe impairment diagnosed as thrombophlebitis. Although the ALJ concluded that appellant could not return to his previous employment, he made no explicit finding concerning the level of exertion appellant was capable of sustaining. In finding that appellant is not entitled to a period of disability or disability benefits, he relied on the report of the vocational expert and found that appellant was able to perform a number of jobs available in the national economy requiring sedentary or light exertional effort.

The district court reviewed the evidence and concluded that the ALJ's determination was supported by substantial evidence. Furthermore, the district court found that appellant's "due process arguments [did] not require a remand." The district court did not, however, consider whether the ALJ utilized the proper standard in concluding that appellant is not disabled.

On appeal, Townley renews his claims of a due process violation, insubstantiality of evidence, and application of the incorrect law. After review, we reverse and remand.

DISCUSSION

It is not the function of a reviewing court to determine de novo whether a claimant is disabled. The Secretary's findings of fact, if supported by substantial evidence, are binding. 42 U.S.C. Sec. 405(g) (1983); Rivera v. Schweiker, 717 F.2d 719, 723 (2d Cir.1983); Aubeuf v. Schweiker, 649 F.2d 107, 112 (2d Cir.1981); Parker v. Harris, 626 F.2d 225, 231 (2d Cir.1980). This deferential standard of review is inapplicable, however, to the Secretary's conclusions of law. "Where an error of law has been made that might have affected the disposition of the case, this court cannot fulfill its statutory and constitutional duty to review the decision of the administrative agency by simply deferring to the factual findings of the ALJ." Wiggins v. Schweiker, 679 F.2d 1387, 1389 n. 3 (11th Cir.1982). Failure to apply the correct legal standards is grounds for reversal. Id.

In the instant case, the appellee's decision was not in conformity with the regulations promulgated under the Social Security Act, 42 U.S.C. Sec. 405(g). The Social Security Act provides disability payments to claimants who are unable "to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve months." 42 U.S.C. Sec. 423(d)(1)(A). Prior to adoption of regulations implementing this definition in February, 1979, 20 C.F.R. Subpart P, Secs. 404.1501-1539 and Apps. 1 & 2 (1980), the Secretary would consult a vocational expert to determine a claimant's eligibility for disability benefits. Pursuant to the 1979 regulations, however, "where the findings of fact made with respect to a particular individual's vocational factors and residual functional capacity coincide with all of the criteria of a particular rule, the rule directs a conclusion as to whether the individual is or is not disabled." 20 C.F.R. Subpart P, Sec. 200.00; SSR Sec. 82-41 (1979) (emphasis added). The regulations were promulgated "in an attempt to attain greater consistency in [disability] decisions," Decker v. Harris, 647 F.2d 291, 294 (2d Cir.1981), by mandating certain conclusions Under the regulations, several initial determinations must be made to evaluate a claimant's eligibility for benefits. When a disability claimant suffers from a severe impairment precluding return to his former employment but which does not automatically qualify him for benefits under 20 C.F.R. Sec. 404.1521(d) (1984), the Secretary, or in cases at the hearing or Appeals Council level, the ALJ, is to make a specific finding of the claimant's residual functional capacity for sedentary, light, medium, heavy, or very heavy exertional work. 20 C.F.R. Sec. 404.1546 (1984).

                if specific sets of findings of fact are made.   Id. at 296
                

Once such a determination is made, the rules for decision specified in 20 C.F.R. Sec. 404, App. 2, should be applied. Based upon the individual's residual functional capacity, the claimant's vocational abilities, i.e. his age, education, and work experience, including his transferable skills, and based on the availability...