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Brown v. Saul

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

September 16, 2019

ANDREW M. SAUL[1], Acting Commissioner of the Social Security Administration, Defendant.



         Sheila Brown mistakenly received roughly $8, 900 from the Social Security Administration, promptly spent it and now says she has no obligation to pay it back. To that end, Brown, who represents herself, has filed a complaint against the Commissioner of Social Security seeking review of the agency's decision denying her request for waiver of an overpayment of disability insurance benefits under Title II of the Social Security Act, 42 U.S.C. § 404(b)(1). [Tr. 17-21.][2] Because I find that Brown was not without fault for the overpayment, the final decision of the Commissioner of Social Security denying Brown's request for waiver of overpayment is affirmed.


         On September 1, 2014, the Social Security Administration advised Brown that she had been awarded social security income (SSI) benefits retroactive to October 2008. [Tr. 22.] The agency communicated in a letter that “[w]e will be in touch with you about your back payments.” [Tr. 23.] On October 26, 2014, the agency notified Brown that she was also entitled to Title II benefits retroactive to March 2009. [Tr. 49.] The agency stated, “[w]e are withholding your Social Security benefits for March 2009 through September 2014. We may have to reduce these benefits if you received Supplemental Security Income (SSI) for this period.” [Tr. 49.] The agency also explained it would withhold $4, 627.25 from past-due benefits in case it needed to pay Brown's representative. [Tr. 50.]

         A few weeks later, on November 17, December 9, and December 11, 2014, Brown visited her local field office for an explanation of the SSI offset of her benefits and the amount withheld for attorney fees. [Tr. 76, 79.] Notes in the record show that Brown “was very irrate and unruly with the staff” so a supervisor explained to her what her Title II retroactive payment would be once the SSI offset was applied to it. [Tr. 76, 79.] The notes from the Social Security administration state that “we wrote down what she was due from T2 retro, so she knew exactly what was coming to her.” [Id.]

         Unfortunately, the payment center did not properly apply the offset, and it released too much money to Brown in her Title II payment. [Tr. 57, 76.] According to Brown, she got a check for $13, 881.75 on December 12, 2014. [Tr. 191.] The check sent to Brown failed to apply the offset. [Tr. 54.] This mistake resulted in Brown being paid more in past benefits than in fact she was due.

         The record in this case is confused by the fact that the Social Security Administration sent two letters to Brown dated December 17, 2014. In the first letter, the agency notified that she “[would] soon receive a check for $13, 881.75, ” which, according to the letter, took into account the SSI offset. [Tr. 54.] Of course, this letter contained inaccurate information since the check for $13, 881.75 mistakenly failed to apply the offset, and soon after that letter was drafted, someone must have realized the mistake. Later that same day on December 17, 2014, the agency notified Brown by a second letter that, “we paid you $8, 904.00 too much in benefits.” [Tr. 57.] The agency explained that, due to a systems error, the past-due benefits were paid without taking into consideration the SSI offset. [Id.] Therefore, the amount paid, $13, 881.75, should have been reduced to $4, 977.75. [Id.]. In other words, Brown had been overpaid in the amount of $8, 903.50. [Id.] Brown claims she did not receive this second letter explaining the overpayment until either December 18, 2014, or closer to Christmas, on December 24, 2014. [Tr. 191.]

         As is her right under the pertinent Social Security regulations, Brown requested waiver of the overpayment on January 29, 2015, arguing she was not at fault and could not afford to pay back the overpayment. [Tr. 64-71.] Brown says that she immediately spent the money on beds, clothing, and debts. [Tr. 192.]

         On February 3, 2015, the agency advised Brown that it would begin withholding amounts from her monthly benefits to recover the overpayment. [Tr. 73.] But just a few days later, on February 9, 2015, the agency stopped withholding from her monthly benefits since Brown had filed a request for a waiver. [Tr. 75.] On February 20, 2015, Brown's waiver request was denied. [Tr. 79.] The agency individual determined that:

Sheila Brown knew what her SSI offset and T2 retro amount would be, since we told her in the office and even wrote it down for her. For this reason, she should have contacted the office before spending all of the money. It is my determination that this waiver should be denied since Ms. Brown knew exactly what she was due for her [] retro payment.

[Tr. 80.] The agency determined that “we cannot waive the collection of this overpayment. This means that you must pay this money back.” [Tr. 82.] Brown moved to reconsider this decision, and on May 21, 2015, her waiver request was again denied on reconsideration. [Tr. 87-88.]

         On July 7, 2015, Brown requested a hearing before an ALJ. [Tr. 91.] The hearing was held before ALJ Michael Logan on March 24, 2017. [Tr. 173-92.] At the hearing, Brown did not dispute that she visited the Social Security office in November and December of 2014, but she did deny that she had ever been advised of the correct amount of the benefits that she would receive after the offset. [Tr. 184-92.] The ALJ did “not credit claimant's testimony” because “SSA personnel clearly advised claimant clearly of the correct amount she was to receive. Therefore, she knew she received an amount in excess of the amount due to her.” [Tr. 20.] Because the ALJ found Brown was aware of the amount of money she was due after offset, she was not without fault in accepting the miscalculated payment. [Tr. 21.] Therefore, the ALJ denied waiver of the overpayment, and found Brown liable for repayment of $8, 903.50.

         Currently, $20 a month is being withheld from Brown's benefits to repay the ...

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