Unpublished Disposition, 868 F.2d 1273 (9th Cir. 1987)

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U.S. Court of Appeals for the Ninth Circuit - 868 F.2d 1273 (9th Cir. 1987)

Richard WOHNUS, Plaintiff-Appellant,v.Otis R. BOWEN, Defendant-Appellee.

No. 87-6704.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Dec. 6, 1988.Decided Feb. 2, 1989.

Before POOLE, REINHARDT and KOZINSKI, Circuit Judges.


Richard Wohnus appeals from the district court's order of November 12, 1987, dismissing his case for lack of subject matter jurisdiction. Wohnus sought to challenge the Secretary's "netting" regulations, 20 C.F.R. Sec. 502 et seq. (1988). Under these regulations, the Secretary offsets any underpayments due to a Social Security claimant against any overpayments made to that same claimant. On a prior motion for partial summary judgment, the district court had held that three notices sent to Wohnus, taken together, were legally adequate to trigger the sixty day period for filing an appeal of the Secretary's offset decision. In its November 12, 1987 order, the district court held that Wohnus had failed to timely exhaust his administrative remedies and thus the court was without jurisdiction to hear his case under 42 U.S.C. § 405(g) (1988). We reverse.1 

The facts in this case are not in dispute. On August 30, 1981, Wohnus was informed by the Social Security Administration (SSA) that his disability insurance benefits and his supplemental security income benefits would be terminated. However, as a result of the SSA's inadvertence or error, Wohnus continued to receive benefits through February 1982. These payments represented an overpayment to Wohnus.

Wohnus reapplied for disability insurance benefits and was informed by the SSA on June 6, 1984 that his application had been approved and that he would be awarded benefits from December 1981. The amount due him was still undetermined at that time. The notice he received also informed him that the previous overpayments to him totaled $10,610.40.2  The notice also told him that he could appeal the SSA's overpayment determination or apply for a waiver of repayment. Wohnus applied for such a waiver on July 2, 1984.

On July 24, 1984, the SSA sent a 2-page notice to Wohnus telling him that the underpayment amount would be reduced by $3,839.94 because of his receipt of supplemental security income from December 1981 through May 1984. On the second page, this notice also stated that " [t]he remaining amount of your past due benefits has been used to reduce your prior overpayment to $3,630.94. We have forwarded your request for waiver of this overpayment to the appropriate unit." Appeal rights were printed on the reverse side of the first page of the notice.

On November 11, 1984, the SSA informed Wohnus that his overpayment waiver had been approved for $3,630.54. The letter did not explain why the amount considered for waiver was only $3,630.54 rather than $10,610.40. However, the letter did state that Wohnus could request reconsideration of the decision by filing a notice with the SSA within 60 days.

On September 25, 1985, Wohnus received a clearer and more thorough explanation of the SSA's waiver determination. On October 28, 1985, a member of the Legal Aid Society wrote to the SSA on behalf of Wohnus and requested that the entire overpayment of $10,610.40 be waived. This apparently was the first formal request for reconsideration of the offset determination. On January 4, 1986, the SSA sent another letter to Wohnus. The SSA stated that the SSA was required by law to automatically offset the overpayment against the underpayment and that because no portion of his waiver had been denied, he was not entitled to a personal review hearing. Another exchange of letters to the same effect followed.

The sole legal issue we need decide is whether, taken together, the SSA's letters to Wohnus dated June 4, 1984; July 24, 1984; and November 11, 1984 (which preceded the clearer and more thorough 1985 explanation) provided Wohnus with the information about the SSA's determination which the Secretary's regulations state he should receive. Briefly, the regulations require that a claimant be informed of (1) the reasons for the initial determination,3  (2) the effect of the determination, and (3) the availability of appellate review. 20 C.F.R. Sec. 404.904 (1988). The notice "must be tailored to the capacities and circumstances of those who are to be heard," Goldberg v. Kelly, 90 S. Ct. 1011, 1021 (1970), namely "the aged, blind, or disabled." Vargas v. Trainor, 508 F.2d 485, 489 (7th Cir. 1974), cert. denied, 420 U.S. 1008 (1975).

We conclude that the three letters do not provide Wohnus with the information to which he is entitled under the Secretary's regulations.4  Most importantly, the language on the second page of the July 24 letter, which both parties agree is critical, would be confusing to a disability recipient. Nowhere does it clearly state that an offset of almost $7,000 has taken place, nor the reason for the offset. Both are required under 20 C.F.R. Sec. 404.904 (1988).5 

The Secretary points out that the November 11, 1984 letter does suggest that a final determination with regard to the overpayment has been made. The letters also informed Wohnus of his appeal rights and that if he had any questions, he should contact the SSA. But this does not in any way change our conclusion that the letters failed to inform Wohnus of the reasons for the SSA's actions.

The September 25, 1985 letter was the first letter to give Wohnus the notice to which he was entitled under the Secretary's regulations. Wohnus timely requested administrative review within 60 days of receiving this notice. The SSA responded to this request in a letter dated January 4, 1986. In this letter, the SSA reiterated what it had said in the September 25, 1985 letter, and also told Wohnus that he was not entitled to a personal hearing. On March 10, 1986, Wohnus wrote to the SSA to appeal from the January 4, 1986 letter. On March 26, 1986, he filed a formal Request for Reconsideration, which the SSA dismissed. Wohnus was informed of this decision in a letter dated May 18, 1986. Wohnus then filed suit in district court on July 22, 1986. This suit was filed within the sixty day period provided for by 42 U.S.C. § 405(g). Thus, we conclude that the district court does have jurisdiction to hear Wohnus's claims.

We are not unsympathetic to the problem that the SSA faces in sending out virtually countless numbers of these and similar notices. Occassionally, through the fault of no particular individual, the system for providing notice will not function as intended and will fail to provide proper notice to a Social Security claimant. In those circumstances, the proper course of action is for the government to allow the claimant his day in court. If his claim is unmeritorious, he will be denied the relief he seeks.



This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3


Wohnus also appeals the district court's holding that it did not have mandamus jurisdiction to hear Wohnus's claims. We need not decide this issue


None of the computations made by the SSA are at issue in this case


In his brief, the Secretary had argued that an offset under the netting regulations was not an "initial determination" within the meaning of 20 C.F.R. Sec. 404.902 (1988), and hence not subject to judicial review. However, the Secretary abandoned this contention at oral argument


Wohnus also contends that the notice he received was constitutionally inadequate. Because we conclude that the three letters did not comply with the notice requirements of the Secretary's own regulations, we need not reach this issue. For the same reason, it is irrelevant whether Wohnus ever received actual notice


We also note that the three letters are not cross-referenced, making the connection between the letters difficult to understand, especially to the average Social Security claimant