Banks v. Shalala, SHHS ( 1995 )


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  • USCA1 Opinion








    January 13, 1995
    UNITED STATES COURT OF APPEALS
    FOR THE FIRST CIRCUIT

    ___________________




    No. 94-1653


    JOHN BANKS,
    Plaintiff, Appellant,

    v.


    DONNA E. SHALALA, SECRETARY OF HEALTH AND HUMAN SERVICES,
    Defendant, Appellee.

    ____________________



    ERRATA SHEET

    The opinion of this Court issued on December 28, 1994 is
    amended as follows:

    On page 2, line 5, delete "written"

    On page 3, line 9, delete "written"

    On page 7, line 13, insert ", or oral argument," between the
    words briefing and schedule






























    UNITED STATES COURT OF APPEALS
    FOR THE FIRST CIRCUIT

    ____________________


    No. 94-1653

    JOHN BANKS,

    Plaintiff, Appellant,

    v.

    DONNA E. SHALALA, SECRETARY OF HEALTH AND HUMAN SERVICES,

    Defendant, Appellee.


    ____________________

    APPEAL FROM THE UNITED STATES DISTRICT COURT

    FOR THE DISTRICT OF MASSACHUSETTS

    [Hon. Edward F. Harrington, U.S. District Judge] ___________________

    ____________________

    Before

    Cyr, Circuit Judge, _____________
    Bownes, Senior Circuit Judge, and ____________________
    Stahl, Circuit Judge. _____________

    ____________________

    Ellen N. Wallace and Sarah F. Anderson on brief for appellant. ________________ _________________
    Donald K. Stern, United States Attorney, Charlene Stawicki, _________________ __________________
    Assistant United States Attorney, and Robert M. Peckrill, Assistant ___________________
    Regional Counsel, Department of Health and Human Services on brief for
    appellee.


    ____________________

    December 28, 1994
    ____________________



















    Per Curiam. Plaintiff-appellant John Banks has ___________

    appealed from the district court's order affirming the

    Secretary's denial of Social Security disability benefits.

    Because the district court issued its affirmance before

    affording Banks an opportunity to submit argument explaining

    his objections to the Secretary's determination, we remand

    this case to the district court for further proceedings.

    Banks applied for disability benefits on January

    15, 1991, alleging an inability to work due to a number of

    physical and mental ailments. On October 12, 1993, the

    Appeals Council denied Banks' request for review of the

    finding of an Administrative Law Judge that Banks was not

    disabled.

    On December 17, 1993, Banks brought the instant

    action in the District of Massachusetts seeking judicial

    review of the Secretary's decision. The Secretary filed an

    answer to Banks' complaint, accompanied by the 767-page

    administrative record of the case, on March 22, 1994. One

    week later, on March 29, 1994, the district court sua sponte

    -- without notice to the parties, and without giving the

    parties an opportunity to submit argument -- issued a

    memorandum and order affirming the decision of the Secretary.

    Judgment for the Secretary was issued on that same date.

    On April 11, 1994, Banks filed a motion to alter or

    amend the judgment under Fed. R. Civ. P. 59(e). In that



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    motion Banks argued that it was improper for the district

    court to enter judgment against Banks without affording Banks

    an opportunity to brief the issues in the case. Banks

    included a proposed briefing schedule. On April 14, the

    district court summarily denied Banks' motion. Banks

    appeals, pressing this same point.

    This court has never considered the question of the

    propriety of a district court, on review of a disability

    determination, affirming the Secretary without affording the

    claimant an opportunity to present argument.1 The three

    circuits that have addressed the issue, however, have all

    declined to sanction the practice.

    In Kistner v. Califano, 579 F.2d 1004 (6th Cir. _______ ________

    1978), the district court entered summary judgment for the

    ____________________

    1. Our decision in Alameda v. Secretary of Health, Education _______ ______________________________
    & Welfare, 622 F.2d 1044 (1st Cir. 1980), cited by the __________
    Secretary, is inapposite. There we noted, in the course of
    ruling that the district court may enter a default judgment
    against the Secretary only if the claimant has established
    his right to relief by satisfactory evidence, "that many
    social security reviews by the district court are simple
    matters, which can often be resolved by reading the findings
    of the Secretary without recourse to a memorandum of facts
    and law. But not all social security cases are of this
    nature. Moreover, appellant may have presented legal
    arguments, or even assertions as to the new circumstances
    bearing on the equities, which the court will want to have
    answered before deciding." Id. at 1047. In this passage we __
    were referring to the discretion of the district court, in
    the course of affirming the Secretary, to dispense with legal
    argument from the Secretary in response to claimant's _________
    arguments. Our comments did not refer to or approve a
    practice of dismissing disability review cases without giving
    the claimant an opportunity to state his or her objections to
    the Secretary's determination.

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    Secretary sua sponte, without prior notice to the parties and

    without any opportunity for the claimant to file written

    argument. The district court treated the respective

    pleadings of the parties "as cross motions for summary

    judgment." Id. at 1005. The Sixth Circuit held that Fed. R. __

    Civ. P. 56 bars a "sua sponte grant [of] summary judgment to

    one party without giving the adverse party notice and an

    opportunity to respond in opposition to the motion." Id. at __

    1006. The court declined to treat the matter as harmless

    error and proceed to the merits on appeal, concluding instead

    that the claimant "is entitled to a full and fair review of

    the Secretary's decision denying her claim for benefits in

    the district court in the first instance." Id. The court __

    thus vacated the district court's judgment and remanded the

    case to the district court for further proceedings.

    In Myers v. Califano, 611 F.2d 980 (4th Cir. 1980), _____ ________

    the district court affirmed the Secretary's decision sua

    sponte based on nothing more than the pleadings. In doing so

    the court relied on 42 U.S.C. 405(g), which allows the

    reviewing court to enter judgment "upon the pleadings and

    transcript of record." The Fourth Circuit held that the

    district court's summary affirmance was nonetheless improper

    in the light of Califano v. Yamasaki, 442 U.S. 682, 699 ________ ________

    (1979), in which the Supreme Court held that 405(g) does

    not exempt actions for review of social security claims from



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    the operation of the Federal Rules of Civil Procedure, but

    instead "prescribes that judicial review shall be by the

    usual type of `civil action' brought routinely in district

    court." Id. Accordingly, the court of appeals ruled the __

    district court's summary affirmance was "inappropriate"

    because the Federal Rules of Civil Procedure entitle the

    opposing party to notice and an opportunity to respond before

    dismissal. The court went on to observe, "[C]ourts derive

    substantial benefit from briefs and oral argument.

    Generally, they should require counsel's aid in clarifying

    and resolving issues." Id. Because, however, both parties __

    to the appeal nonetheless urged the court of appeals to go

    ahead and decide the merits, the court did so. Id. __

    In the third case, Flores v. Heckler, 755 F.2d 401 ______ _______

    (5th Cir. 1985), the district court, similarly, entered

    judgment for the Secretary sua sponte without affording the

    claimant an opportunity to present argument. In response to

    the claimant's argument that the district court was required

    to, and had failed to, follow the mechanism of Fed. R. Civ.

    P. 56 in dismissing disability review actions, the Fifth

    Circuit stated that use of summary judgment, although

    permissible, was not required. The court of appeals

    indicated that it was unconcerned whether a district court

    chose to proceed under Rule 56 or Rule 12. What was

    important, the court of appeals ruled, was that "district



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    courts reviewing disability determinations should not

    conclude their review without an appropriate opportunity for

    the presentation of the parties' contentions." Id. at 403. __

    The court of appeals went on to find that the error was

    harmless in the case before it, and proceeded to the merits,

    because the claimant had presented his arguments in full in

    his motion for new trial, and in denying that motion the

    district court had "stated that it had reviewed `the motion,

    the record, and the law.'" Id. __

    Like the Fifth Circuit in Flores, we need not ______

    concern ourselves with whether the district court's order is

    more appropriately labelled and analyzed as under Rule 12 or

    Rule 56 of the Federal Rules of Civil Procedure. We simply

    hold, as did Flores, that "district courts reviewing ______

    disability determinations should not conclude their review

    without an appropriate opportunity for the presentation of

    the parties' contentions." Id. at 403. In his memorandum in ___

    support of his Rule 59(e) motion, Banks set forth specific

    objections to the Secretary's determination that, whatever

    their ultimate merit, certainly appear substantial enough to

    justify an opportunity for full briefing.

    We cannot find, unlike the court in Flores, that ______

    the district court's error was harmless. For one thing, it

    is by no means clear that Banks' memorandum in support of his

    Rule 59(e) motion, which devoted only three-and-one-half



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    pages to a summary of the claimant's substantive arguments,

    constituted a full presentation of those arguments to the

    district court. The claimant in Flores, by contrast, had ______

    submitted "a 22-page memorandum arguing that the Secretary's

    decision was not supported by substantial evidence," id. at __

    402, which the court of appeals deemed "fully presented his

    substantive arguments," id. at 403. Also, we are not __

    satisfied that the district court, in denying the Rule 59(e)

    motion, signalled that it had given adequate consideration to

    Banks' arguments. Whereas the district court in Flores ______

    specifically stated that it had reviewed "the motion, the

    record, and the law," id., the district court here simply __

    endorsed the motion with "Motion denied."

    Accordingly, we vacate the judgment of the district ______

    court and remand this case for further proceedings. On ______

    remand, the district court is to establish a briefing, or

    oral argument, schedule that affords the parties an

    opportunity to present their arguments before the court

    issues its ruling.















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