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Payne v. Colvin

United States District Court, N.D. Indiana, South Bend Division

March 13, 2014

JESSE L. PAYNE, Plaintiff,
CAROLYN COLVIN, Commissioner of Social Security, Defendant.


PHILIP P. SIMON, Chief District Judge.

Jesse Payne seeks review of the Social Security Administration's (SSA) decision to deny his application for disability insurance benefits. Payne applied for child's benefits in 2009, when he was 39 years old, because he had been turned down for benefits previously under his own insurance since he hadn't worked enough quarters to be covered. Payne now seeks benefits based on his deceased father's Social Security. To get child's benefits, Payne needs to show that he has been unable to work due to disability since before he turned 22.

The administrative law judge who heard the case held a 23-minute disjointed hearing at which Payne didn't get a chance to testify fully and at which no medical advisor was consulted. The ALJ indicated that he would end the hearing to seek records from previous applications and later reconvene the hearing. Then, about a month after the hearing, the ALJ issued an opinion denying benefits based on the fact that the record didn't indicate disability before age 22 and did indicate substantial gainful activity (which means Payne wasn't disabled) after age 22. On appeal, Payne claims that the ALJ erred in several respects but for present purposes I will focus on only two of the issues: whether the ALJ failed to develop a full and fair record by cutting the hearing short and whether the ALJ was correct in finding that Payne's work history in 2000 disqualified him from receiving child's benefits.

In sum, I agree that the record needs to be more fully developed in terms of form, severity and onset of disability, as well as Payne's work history. Therefore, the matter is REMANDED back to the ALJ to develop a fuller record - Payne deserves the chance to testify, more work history and paycheck records would be helpful in creating a full record, and a medical advisor's review of the 1989 records might shed light on Payne's disability, if any, when he was 19. Although Payne's efforts at obtaining child's benefits are likely a long shot, he has to at least be given a reasonable opportunity to fully present his case.

Additionally, Payne moved to supplement the record (Docket Entry 22) with medical records from The Hamilton Center for treatment Payne received there between 2001 and 2005. While these records don't appear relevant to the issue of Payne's disability before age 22, they do bear on Payne's work history in 2001 and the reasons he stopped working, so the motion to supplement is GRANTED.


Payne filed the present claim in 2009, alleging a disability onset date of April 30, 1992, less than two weeks before Payne turned 22. (Record 10, 165.) The ALJ held a hearing on June 2, 2010 (R. 331-45) and denied the claim on July 25, 2011. (R. 10-18.) The SSA Appeals Council denied review of the decision on August 30, 2012, making the ALJ's decision the SSA's final one. (R. 3.) Payne has appealed the SSA's decision.

My decision at this point is based on procedural rather than substantive factors, so a full medical history isn't pertinent. The two big factual issues are whether Payne was disabled before he turned 22. Then, assuming he was disabled heading into his twenty-second birthday, the other big issue is whether he engaged in substantial gainful activity after he turned 22, which would mean his disability hasn't been continuous. The earliest documents in the record are from 1989, when Payne was 19 and was sent to a residential substance abuse treatment program in connection with criminal charges he was facing for burglary and arson. (R. 169.) The report presents Payne's depressing upbringing and is rife with his long history of substance abuse, as well as tales of serious family dysfunction. (R. 169-71.) Payne had multiple law enforcement contacts, the earliest when he was 14. (R. 170.) Payne reported several symptoms often connected with mental health issues or drug abuse to the drug treatment facility, including seizures, blackouts, suicide attempts, depression, and paranoia. (R. 170.) The records don't indicate that Payne was on any medications for mental illness while he was in the substance abuse program, and he wasn't prescribed any there. (R. 14-15.) There are no records from 1990 to 2000. Payne turned 22 in 1992. (R. 165.)

Payne did some work in 2000 and 2001, although the record doesn't say exactly how long he worked, or exactly where. Payne testified about working for John Deere through the temp agency Manpower. But he also worked at Burger King and some other jobs, and there was no testimony about those, or the reasons Payne left them. (R. 339, 341.) He appears to have worked five to six months in 2000 and to have earned over $11, 000. (R. 12-13.) Payne testified that he did well at John Deere while on haldol (an antipsychotic), but they required a forklift certification before Payne could be fulltime, and the job seems to have gone off the rails from there and Payne's work success ended. (R. 342.) Payne says that he stopped working because he "got sick mentally, real bad. Started having hallucinations." (R. 338.) Payne then did an unspecified number of other jobs for an unspecified period of time. (R. 341.) The fact that this work attempt period was unsuccessful due to mental illness is backed up by a psychiatric evaluation from the Hamilton Center that says Payne entered Logansport State Hospital in early January 2001 and stayed into April. (DE 22-1 at 12.) There are other records from 2001 and on, but they aren't relevant at this point. Payne successfully applied for Supplemental Security Income in 2003 upon showing the required level of severity of his "schizophrenia, paranoia and other functional psychotic disorders." (DE 27 at 2, R. 49-50.)

The ALJ denied Payne's application for child's benefits. He said that the prior denied application may preclude this one, but he went on to consider the merits of Payne's current case anyway. (R. 10.) The ALJ held that Payne hasn't suffered from a disability under section 223(d) of the Social Security Act since Payne was 22. The ALJ's reasons for the finding were twofold: First, the ALJ held that Payne had engaged in substantial gainful activity in 2000. (R. 12-13.) Second, the ALJ found that there was no evidence to show that Payne was disabled before he reached age 22. In fact, the ALJ found that the evidence indicated Payne didn't suffer from a disability at age 19. (R. 13-18.)


Payne seeks child's benefits under 20 C.F.R. § 404.350, which means Payne needs to show that he (1) is the child of an insured person entitled to old-age or disability benefits or who has died, (2) is dependent on the insured, (3) applied for benefits, (4) is unmarried, and (5) is over 18 years old and has a disability that began before he turned 22. Only the fifth element is contested here. It is insufficient for Payne to show that his disability stems from an impairment that he suffered before he was 22 if the impairment was not disabling before he turned 22. In other words, the disability must have begun before age 22 and continued to the present. "[T]he legislative history as well as every other opinion in this and other circuits requires a showing that the impairment had reached disabling severity prior to age 22." Lieberman v. Califano, 592 F.2d 986, 987 (7th Cir. 1979) (footnotes and citations omitted).

First off, the ALJ made a confusing reference to res judicata in his opinion, citing to 20 C.F.R. § 404.957(c)(1). I take it he was suggesting that because Payne's benefits claim was denied in 2008 and Payne didn't appeal, that somehow precludes the current claim. The principle of res judicata says that once a court has made a final decision on a cause of action based on particular facts, that decision stands, even if the same parties and cause of action and facts are brought up in another case. This allows judges to make quick work of vexatious and repetitive filings. The application of res judicata is completely inapposite here. The prior application was based on Payne's own work record around 2001, not on his father's work record. It was denied because Payne hadn't worked enough to be insured, not because Payne wasn't disabled. (DE 27 at 1-2.) Now, Payne seeks child's benefits based on his father's work record under 20 C.F.R. § 404.350, and in doing so Payne needs to show he hasn't worked. He is seeking benefits under a different code section and his motivation and required factual showings are different, so these issues haven't been decided before.

Moving on to the merits, if the ALJ's findings of fact are supported by "substantial evidence" then they must be sustained. See 42 U.S.C. § 405(g). Substantial evidence consists of "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Nelms v. Astrue, 553 F.3d 1093, 1097 (7th Cir. 2009) (quoting Richardson v. Perales, 402 U.S. 389, 401 (1971)). Review of the ALJ's findings is deferential. See Overman v. Astrue, 546 F.3d 456, 462 (7th Cir. 2008). In making a substantial evidence ...

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