State v. Lindstrom , 68 Idaho 226 ( 1948 )


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  • On August 14, 1935, the 74th Congress, Sess. 1, Ch. 531, enacted the Social Security Act, 42 U.S.C.A. § 301 et seq. Title I thereof provided, "Grants To States For Old-Age Assistance." When used in Title I of said Act the term of old-age assistance means money payments to aged individuals. Section 1 of said Title made an appropriation and the sums appropriated and made available under said Act were to be used in matching payments with states which had submitted plans to be approved by the Social Security Board as established by Title VII of the Act and under state plan for old-age assistance.

    Section 2 provides for state old-age assistance and subsection (a) thereof is as follows: "(a) A State plan for old-age assistance must (1) provide that it shall be in effect in all political subdivisions of the State, and, if administered by them, be mandatory upon them; * * *."

    Other provisions of subsection (a) are enumerated. *Page 235

    Paragraph (7) thereof is as follows: "(7) provide that, if the State or any of its political subdivisions collects from the estate of any recipient of old-age assistance any amount with respect to old-age assistance furnished him under the plan, one-half of the net amount so collected shall be promptly paid to the United States."

    From section 2, subsection (a) it manifestly appears that the State plan for old-age assistance is mandatory and must contain certain prescribed requirements in order to entitle a state to "Grants to States for Old-Age Assistance under the Social Security Act." We particularly invite attention to paragraph (7), which authorized a state to collect from the estate of a recipient of old-age assistance any and all amounts paid under the plan. In other words, any right and authority of a state to collect from the estate of a recipient of old-age assistance must come from and through the provisions contained in paragraph (7) aforesaid, and without such authority a state is not entitled to file a valid claim against the estate of a deceased recipient or maintain an action for any amount whatsoever, irrespective of the manner in which an estate of a recipient of old-age assistance was acquired, that is, whether the recipient had covered up property or income at the time of making application for assistance, or after being awarded assistance he had come into property and income which he did not report and which was sufficient to provide him in such manner that assistance was no longer necessary.

    The complaint in this case shows that it is an action in debt. It also shows that the deceased (Frans G. Magnus) was paid the aggregate sum of $1,651 for old-age assistance, and that no part of the said sum has been repaid to the state, and that there is now due and owing the state of Idaho the said sum of $1,651.

    The statutory provision under which the action was commenced and is sought to be maintained is as follows: "Section 24-a. Recovery From Estates. On the death of any recipient of old-age assistance, the total amount of assistance paid such recipient under this act may, in the discretion of the State Department, be allowed as a claim against the estate of such person after reasonable funeral expenses, the expenses of the last illness, and the expenses of administering the estate have been paid."

    In the case of State ex rel. Dean v. Brandjord et al.,108 Mont. 447, 92 P.2d 273, 279, being a mandamus proceeding to compel payment of full amount of monthly old-age assistance, it is said: "When the whole subject of relief for the aged indigent is taken into consideration, when the history of federal and state legislation is given proper effect, when the national plans and the subsequently enacted state plans of the different states are understood, it would seem that none of the state plans, including our own, were ever devised to stand or operate without the cooperation *Page 236 of the federal government. [Authority]. If this be true, and we think that it is beyond question the outstanding theory of the whole matter, then it is obvious that our law must be construed, not as an independent Act, but in conjunction withthe federal Act, that is, the two Acts must be administeredtogether as a unified code of laws enacted by Congress and thestate legislature for the complete and comprehensive control ofthe subject." (Emphasis ours.)

    We have indicated that authority for any activity by a state incident to recovery or the collection of payments from the estate of a deceased recipient was embodied in section 2 of Title I of the Social Security Act as originally enacted. Section 2, of the original Act, was subsequently designated as Section 302, and the provision contained in paragraph (7) of section 2, as originally enacted, was repealed and in the case of Morgan v. Department of Social Security, 14 Wn.2d 156,127 P.2d 686, 693, it is said: "It is evident that there is a conflict between the provisions of the Federal act and those of the state statute. In the portion of the Federal act above quoted is found the following: '(a) A State plan for old-age assistance must * * * (7) effective July 1, 1941, provide that the State agency shall, in determining need, take into consideration any other income and resources of an individual claiming old-age assistance.'"

    Accordingly, any former provision that a state or its political subdivisions might collect from the estate of a recipient of old-age assistance is no longer authorized by the Social Security Act, and, which is the only source of authority of states and/or their political subdivisions, any claim of the state against the estate of Frans G. Magnus, deceased, or the commencement of an action against Nels Lindstrom, the executor of his estate, is a nullity, and cannot be sanctioned.

    In support of the statement that any attempted recovery is a nullity because unauthorized by the Federal act, we here mention that there is also, another reason why no recovery is permissible and that is that the action was a direct action addressed to the original rather than the appellate jurisdiction of the court. Thus, we are confronted with two propositions, (1) that no recovery can be had for the reason that there is no authorization therefor by the Federal act, and (2) that the court had no jurisdiction in that the only right the court had in the premises was under and through its appellate jurisdiction.

    In the case of Bowen v. Department of Social Security,14 Wn.2d 148, 127 P.2d 682, 684, it is said:

    "At the time the constitution [State] was adopted, civil procedure was governed by the practice act of 1881. Code of 1881, p. 35 Section 1, chapter 1, provided that: 'The common law of England * * * (I.C.A. 70-116) and the organic act and laws of Washington Territory shall be the rule of decision in all the courts of this *Page 237 Territory.' And § 2 provides that: 'There shall be in this Territory hereafter but one form of action [I.C.A. 5-101] for the enforcement or protection of private rights and the redress of private wrongs, which shall be called a civil action.' * * *

    "It hardly requires argument to demonstrate that the court proceedings provided for in § 9 of chapter 1, Laws of 1941, the senior citizens grants act, do not come within these provisions of the practice act of 1881. The court proceedings provided forin that act are not commenced in any court. They have theirinception in the department of social security, and find theirway to the courts through appeal — not by way of the issuanceof summons. [Emphasis ours.]

    "Further than that, the functions now exercised by administrative bodies under legislative authority were practically unknown to Amercian jurisprudence at the time our constitution was adopted; and, so far as we can ascertain, they were wholly unknown to our territorial jurisprudence. To say that court proceedings arising out of the exercise of such administrative functions are civil actions in contemplation of the limitation on this court's jurisdiction, contained in § 4, art. IV, of the constitution, would make that provision 'express purposes which were never within the minds of the people in agreeing to it.' People v. Harding, supra [53 Mich. 481,19 N.W. 155]. What pertinent authorities there are on the subject lend support to the view that court proceedings flowing from controversies arising before administrative bodies are in no sense civil actions as they were understood at common law.

    "Colonel O.R. McGuire, a member of the American Bar Association's special committee on administrative law, in an article published in 26 Georgetown Law Journal, 574, 589, says: '* * * administrative law is a separate and distinct branch of the law. It is not common law, equity, or admiralty law * * *.' "

    The case of Morgan v. Department of Social Security,14 Wn.2d 156, 127 P.2d 686, 692, 708 deals extensively with Title I of the Social Security Act, and the adoption of the plan submitted by the state of Washington through the provisions of initiative 141, and in accordance with the requirements of the act and the approval of the Social Security Board as provided in Section 302 of the Act. Contained therein it is said:

    "A transcript of the minutes of the meeting of the Federal social security board at which initiative 141 was considered, contains the following:

    "`Section Three, subsections (g) and (h), of this initiative measure are in violation of the provisions of the Social Security Act, which became effective, July 1, 1941, in that the state agency may disregard certain "income and resources" in determining whether an applicant is eligible for old-age assistance; and may also be in violation of presently effective provisions *Page 238 of Social Security Act prior to July 1, 1941, since the act does not allow Federal participation in a plan under which old-age assistance may be paid to an individual who is not "needy."` * * *

    "As above stated, recipients are needy persons, and entitled to grants under the statute. This has never been disputed. The disputed questions involve the claims of recipients to grants in larger sums than allowed by the department.

    "It is evident that there is a conflict between the provisions of the Federal act and those of the state statute. In the portion of the Federal act above quoted is found the following: '(a) A State plan for old-age assistance must * * * (7) effective July 1, 1941, provide that the State agency shall, in determining need, take into consideration any other income and resources of an individual claiming old-age assistance.' * * *

    "By subparagraph (h) of the same section, it is provided that: 'Resources' shall mean any property which the applicant owns legally or beneficially, excepting therefrom: * * * (3) The homestead, home or place of residence of applicant or the spouse of applicant. * * *'

    "The language of § 3 itself shows that the items which are excepted from income, and thereafter excepted from resources, including the ownership or occupation of a dwelling, are in fact income and resources, the statute providing, however, that such items shall not be considered when computing the amount of grants to persons entitled to the benefit of the act. The state statute, then provides that certain income or resources shall not be considered, which items the Federal act says shall be considered, in fixing the amount of grants by the state agency which are to be matched by Federal funds. * * *

    "We now hold that § 3, sub-paragraphs (g) and (h), of initiative 141, are not in accord with the provisions of the Federal Social Security Act, and that the Federal board correctly held that these sub-paragraphs 'are in violation' of that act.

    "The act contains other references to the Federal Social Security Act, which show clearly that initiative 141 was intended to keep pace with the Federal act and be administered always in view of the Federal act, as the same might from time to time be amended, or as the administration thereof might be changed. * * *

    "`The federal and state statutes represent "a cooperative legislative effort by state and national governments, for carrying out a public purpose common to both, which neither could fully achieve without the cooperation of the other." Carmichael v. Southern Coal Coke Co., 301 U.S. 495, 526,57 S.Ct. 868, 880, 81 L.Ed. 1245, 109 A.L.R. 1327.'"

    From the foregoing it readily appears that the Washington Public Assistance Act, as embodied in initiative 141, was endeavoring *Page 239 to allow recipients certain income and resources, and independent of Grants-In-Aid, which was not provided for in Title I of the Social Security Act, and that such seemingly inconsequential provisions as contained in subparagraphs (g) and (h) are in violation of the Social Security Act, due evidently to the closely knit adherence to the cooperative legislative effort of state and national governments in carrying out a public purpose common to both. If the board held that the provisions contained in subparagraphs (g) and (h) which allowed certain income and resources not allowed by the Social Security Act to be disregarded in determining the amount of assistance to be awarded a recipient then there is no need to speculate as to what said board would hold on the question of the validity of the state of Idaho to file a preferred claim against the estate of Frans G. Magnus, deceased, or to institute a suit in the District Court against his executor under the provisions of section 24-a, supra, for the full amount of Grants-In-Aid lawfully paid Magnus as a recipient of old-age assistance, instead of handling it as a departmental matter in accordance with law, or that the State might assume that any such provision was legal since paragraph (7) providing for recovery as contained in the original Social Security Act had not been lifted therefrom and is still contained therein.

    The majority opinion states that, "The granting of aid to its needy aged is a well recognized obligation of the state and is a governmental function tending to promote the public welfare." In support of such statement we are cited to the case of Alameda County v. Janssen, 16 Cal.2d 276, 106 P.2d 11, 130 A.L.R. 1141; 41 Am.Jur. 690. Said case deals with an Act of the legislature of California of 1929, providing financial assistance to needy aged who met certain requirements, and whose property did not exceed specified values. There were no matching funds available or involved. It is of no assistance in determining whether a state may collect any or all of the amounts paid a recipient of old-age assistance.

    The majority opinion treats the Public Assistance Act as the only legislation involved, and that Section 24-a, Session Laws 1947, as the sole and only measure of determining the right of the State to recover any payments made to recipients of old-age assistance. Said opinion does not take into account that payments of old-age assistance is a cooperative function and that without such cooperation the State would be powerless to act.

    In the case of Bowen v. Department of Social Security,14 Wn.2d 148, 127 P.2d 682, a proceeding wherein the respondent Bowen made a demand upon the Director of the Department of Social Security of the State of Washington, to increase his award of $34 a month to $40 a month and demanded "a fair hearing" under the provisions of section 8, p. 7, of the act, which provided that said hearing should be had *Page 240 not more than 30 days after the receipt of notice. More than 30 days having elapsed Bowen gave notice of appeal to the superior court of Grays Harbor county. A motion to quash the notice of appeal was interposed by the department and the Supreme Court in passing upon the matters involved said: "To the extent, at least, that it is composed of 'federal matching funds' the fund from which 'Senior Citizens Grants' are paid is essentially a trust fund, for the proper expenditure of which the state department of social security is responsible to the federal government."

    The fact that 24-a, Laws of 1947, authorizes a recovery of all amounts, without reservation, theretofore paid recipients of old-age assistance, it is apparent that the payment of assistance to recipients, which may subsequently be recovered, must be characterized as a loan, otherwise there could be no provision for recovery, and under those conditions, of course, would be offensive to Section 2 of Article 8 of the Constitution which inhibits the loaning of the credit of the state to any individual.

    In the case of Burgdorf et al. v. Department of Social Security, 14 Wn.2d 209, 127 P.2d 709, practically the same questions are involved as in the case of Morgan v. Department of Social Security. I quote therefrom, not so much for the purpose of showing that grants-in-aid to recipients under the Washington Public Assistance Act, as embodied in initiative 141, must be made in accordance with the provisions of the Social Security Act and not in accordance with the state Act allowing income and resources in addition to the payment of sums for old-age assistance, but more particularly for the purpose of emphasizing a matter heretofore pointed out, that is, that any controversy between a recipient and the department of social security must be determined in the first instance in the department and find its way to the courts only through appeal and not by way of issuance of a summons. In this case the department had deducted $11 from each of the recipients because of home ownership, combined living and the use of water without payment. The recipients sought a hearing before the Pierce County Welfare Department which recommended the deduction and the recipients being dissatisfied with the amounts of grants, recommended by the County Welfare Department, requested a fair hearing thereon before the director of the state department. The hearings were had, and thereafter the director approved the recommendations of the Pierce county welfare department, and awarded each applicant a grant in the sum of $29 each month. "The recipients, being of the opinion that they were each entitled to a grant in a greater amount, appealed from the departmental orders to the superior court for Pierce county. After a hearing, the trial court reversed the departmental orders, and remanded the cases to the department, with instructions that each grant should be increased, and payment *Page 241 thereof in the increased amount be made retroactive to date from December 4, 1940. From these judgments the department of social security has appealed. The cases have been consolidated for hearing before this court."

    The judgments in the cases at bar were reversed with instructions to enter judgments affirming the orders of the department.

    In the case of Halsell et al. v. Department of Social Security, 14 Wn.2d 709, 127 P.2d 711, something of the same proposition as contained in the case of Burgdorf v. Department of Social Security, supra, was up for determination. The Grays Harbor county welfare department recommended that a grant be made to Mr. Halsell of $30 per month, and that a similar grant be made in favor of Mrs. Halsell. "The recipients, being dissatisfied with the recommendation of the county welfare department, requested a fair hearing before the director of the department, which hearing was granted and the testimony reduced to writing. Based upon the record so made, the director rendered his decision June 19, 1941, affirming the action of the county welfare department, and awarding a grant to each recipient in the amount of thirty dollars per month. Feeling aggrieved by the decision of the director, the recipients appealed to the superior court, where the matter was, heard upon the record made before the department, no new evidence having been offered by either party."

    The controversy grew out of the fact that each recipient sought a grant of $40 and there was deducted from said amount $7 because of home ownership, and $3 because of combined living.

    Further quoting from Halsell et al. v. Department of Social Security, supra:

    "* * * In accordance with the conclusions of law, the court entered its decree remanding the proceeding to the department, with directions to revise the awards by eliminating therefrom the deductions above referred to. From this decree the department of social security of the state of Washington has appealed to this court."

    "The trial court was evidently of the opinion that the deductions above referred to, made by the director, were not in accordance with the provisions of initiative 141. * * *

    "We have determined this question contrary to respondents' contention. As stated in our opinion in the consolidated cases of Morgan et al. v. Department of Social Security, [14 Wn.2d 156],127 P.2d 686, we are convinced that initiative 141 by its own terms must be construed in connection with the Federal statute, and that certain provisions of the state statute are not in harmony with the Federal laws and must be disregarded." *Page 242

    The judgment appealed from was reversed with instructions to enter judgment affirming the order of the department.

    In Vol. 42, Am.Jur., p. 698, sec. 254:

    "The Federal courts have established a set of principles known as the 'primary jurisdiction doctrine,' developed in cases construing the Interstate Commerce Act [49 U.S.C.A. § 1 et seq.], but given general application to Federal administrative bodies other than the Interstate Commerce Commission, and applied by the Federal courts in relation to state administrative bodies. [Woodrich v. Northern Pac. R. Co., 8 Cir., 71 F.2d 732, 97 A.L.R. 401.]

    "The doctrine of primary jurisdiction is that the courts cannot or will not determine a controversy involving a question which is within the jurisdiction of an administrative tribunal prior to the decision of that question by the administrative tribunal, where the question demands the exercise of sound administrative discretion requiring the special knowledge, experience and services of the administrative tribunal to determine technical and intricate matters of fact, and a uniformity of ruling is essential to comply with the purposes of the regulatory statute administered. The principle is derived from a consideration of the nature of the question and of the inquiry and the action required for its solution. The courts will not take jurisdiction even temporarily, pending an investigation before the administrative tribunal, so as to grant an injunction against rates alleged to be unreasonable or discriminatory. The doctrine is applied in the face of statutes which expressly purport not to abridge or alter existing remedies on the ground that such a provision cannot be construed to continue rights which would be absolutely inconsistent with the statute." (Innumerable authorities are cited in support of the foregoing doctrine.)

    In support of the doctrine that an action may not be instituted in a district court because of a controversy arising before an administrative department, we cite the case of Peterson v. Livestock Commission, Mont., 181 P.2d 152, 157, wherein it is held:

    "It is generally held that a statute which attempts to place the court in the place of a commission or board to try a matter anew as an administrative body is unconstitutional as a delegation to the judiciary of nonjudicial powers. A few of the many cases so holding are the following: Steenerson v. Great Northern Ry. Co., 69 Minn. 353, 72 N.W. 713; State v. Great Northern Ry. Co., 130 Minn. 57, 153 N.W. 247, Ann.Cas. 1917B, 1201; In re Hunstiger, 130 Minn. 474, 153 N.W. 869; State ex rel. Dybdal v. State Securities Comm., 145 Minn. 221,176 N.W. 759; State Board of Medical Registration v. Scherer,221 Ind. 92, 46 N.E.2d 602; In re Fredericks, 285 Mich. 262,280 N.W. 464, 125 A.L.R. 259; Mojave River Irr. Dist. v. Supreme Court,202 Cal. 717, 262 P. 724; Borreson v. Department of *Page 243 Public Welfare, 368 Ill. 425, 14 N.E.2d 485; In re Opinion of Justices, 85 N.H. 562, 154 A. 217.

    "Statutes providing for appeals somewhat similar to that under consideration have been held valid by interpreting them as not granting trials de novo in the full sense of that expression but as conferring authority for the court to pass upon the lawfulness only of the order of the board or commission. Examples are: Morgan v. Department of Social Security, 14 Wn.2d 156, 127 P.2d 686; Investors Syndicate v. Hughes, 378 Ill. 413, 38 N.E.2d 754; Lloyd v. City of Gary,214 Ind. 700, 17 N.E.2d 836.

    "The only proper questions that may be tried by a court on appeal from an order such as the one here involved is whether the commission acted capriciously or arbitrarily or without jurisdiction or authority under the law. People of State of New York ex rel. New York Queens Gas Co. v. McCall, 245 U.S. 345,38 S.Ct. 122, 62 L.Ed. 337; State v. State Board of Equalization, 56 Mont. 413, 185 P. 708, 186 P. 697."

    Since the majority opinion has been rewritten, there is included therein the case of City of Worcester v. Quinn,304 Mass. 276, 23 N.E.2d 463, 125 A.L.R. 707. I fail to see wherein said authority is of any assistance when applied to the majority opinion. I will refer to said matter later.

    Referring to the case of Alameda County v. Janssen, supra, that was an action in mandamus to compel Janssen as Chairman of the Board of Supervisors of Alameda County to execute certain releases of liens and cancellation of restrictive agreements with respect to real property of the recipients of financial aid granted under the provisions of old-age security act of the state. In 1937 the California Legislature amended sections 2224 and 2225 of the Welfare and Institutions Code, into which section 4 of the Old-Age Security Act had been incorporated, to eliminate the provisions of such liens as well as the provisions making the aid a debt of the recipient to the state and county. Section 2225 was amended to provide that, "all liens and mortgages heretofore created under the provisions of said chapter are hereby released and the board of supervisors of each county * * * are hereby directed and authorized to execute and record appropriate instruments of release." Janssen, as chairman of the board of supervisors, refused to execute said liens and releases on the grounds that it violated section 31 of article IV of the California Constitution, prohibiting the legislature from making or authorizing any gift of public money and also that it violated prohibitions in the United States and California Constitutions against the passage of any law impairing the obligation of contracts. The court in passing on the question, construed the constitutional provision as follows [16 Cal.2d 276, *Page 244 106 P.2d 14]: "Section 31 of article IV of the California Constitution prohibits the legislature from making or authorizing a gift of public money or thing of value to any individual or corporation. The next clause, however, provides that nothing in this section shall prevent the legislature from granting aid pursuant to section 22 of article IV which authorizes the granting of aid to indigent aged. Therefore the release of a lien by a county, pursuant to section 2227 of the Welfare Code, does not constitute a violation of section 31, article IV, if (1) it is a gift of public money or thing of value, or (2) it is a grant of aid to indigent aged under section 22 of article IV."

    It will be observed that section 22 of article IV of the Constitution, authorized the granting of aid to indigent aged. We have no such provision in our constitution and it was because the liens, mortgages and contracts established an existing debt, that Janssen, even in the face of section 22 of article IV, aforesaid, and the legislation that was enacted, refused to sign releases of the liens that had been incurred by the recipients of aid to indigent aged. The majority opinion recites, "Thus, in view of the statutes, the question before us is whether the granting of old-age assistance under the terms and conditions of our Public Assistance law * * * falls within the inhibitions of Section 2 of Article 8 of the Constitution of the State of Idaho." What brings the question to the attention of this court? Is it because of there being a public assistance act, or because the legislature has seen fit to amend said act by including therein a provision for a recovery of the amount of assistance paid a recipient. Section 24-a, supra, is not a part of the substantive law of this jurisdiction. But, to the contrary, is purely procedural, and, incidentally, is the first resort in an attempt to establish a collection agency of the Public Assistance Act. The majority opinion observes, "If respondent is right in his contention that the Public Assistance law is unconstitutional, even though it creates no obligation on the part of any recipient of relief to repay any part of the relief granted, it would, of course, carried to its logical conclusion, mean the legislature would be powerless to provide for any relief whatever to the deserving and needy, and that would be absurd." From the foregoing, it is made to appear that section 24-a is superior to all other phases of the Public Assistance Act. I know of no one who asserts, or insists, that the payment of old-age assistance, in the first instance, violates the credit provision of section 2, article VIII of our constitution. It is the enforcement or attempted enforcement of the recovery provision, written into the law, that is the "fly in the ointment." Without such recovery provision no one would contend that the act is offensive to the constitution. The enforcement of the recovery provision, however, is questioned and objected to because *Page 245 its enforcement of necessity shows that the payment of old-age assistance to a recipient is in the nature of a loan. If it were not in the nature of a loan it could not be recovered and the contention, as I see it, is that section 24-a, the recovery provision, is unconstitutional and a nullity, and therefore incapable of enforcement.

    I submit that before the State can recover from the estate of a deceased recipient of assistance there must exist an obligation on the part of the estate to pay the amount sought to be recovered. In other words, a contractual obligation in some form or manner between the State and the deceased recipient, during his lifetime must be established. In speaking of said matter, relative to the right of a state to recover from the estate of a deceased recipient of old-age assistance, the Social Security Act of August 14, 1935, 49 U.S.Stats. 620, Title 42, U.S.C.A. §§ 301 — 306 was mentioned in the case of City of Worcester v. Quinn, supra [304 Mass. 276,23 N.E.2d 465], and therein it is said:

    "This act of Congress provided for the grant of Federal funds for old age assistance to such States as should adopt an old age assistance plan containing certain requirements, one of which was that 'if the State or any of its political subdivisions collects from the estate of any recipient of old-age assistance any amount with respect to old-age assistance furnished him under the plan, one-half of the net amount so collected shall be promptly paid to the United States.' * * * The only matter covered by this provision of the act of Congress and by our own statute which incorporated it was to provide for the apportionment and distribution of such proceeds as may be realized from the estate of a recipient of aid, and both enactments left untouched any liability upon the part of the estate of a recipient to reimburse the city. A statute is to be fairly and reasonably construed and its scope is not to be extended by construction beyond its apparent limits. [Citing authorities].

    "Both Congress and our own Legislature were content to let that liability continue to rest upon the principles of common law and to share in the proceeds of actions where payments had been made through accident, fraud or mistake. The mere right to share in one half of the net amount collected from the estate of a recipient of aid, without establishing any obligation upon the part of the estate to pay and without creating any new remedy, must be construed to mean that the collection from the estate must be had by present remedies under our existing law. This conclusion is also supported by the relationship existing between the Federal and State governments in the establishment and maintenance of old age assistance. * * *

    "Report No. 615 of the committee on ways and means recommended the passage of the social security bill (H.R. 7260). The bill then contained s. 206, captioned 'Over-payments *Page 246 during life,' which provided that 'If any recipient, through error or otherwise, has received benefit payments in excess of the amount to which he is entitled, and dies before such overpayments have been adjusted,' then his estate shall repay a certain amount to the United States. In the same report, at page 17, it appears that the purpose of this section was to secure from the State one half of the Federal contributions paid to recipients from whose estates the State has recovered on account of payments 'because those persons had been defrauding the State.' The committee on finance, report No. 628, recommended the adoption of bill H.R. 7260 containing said s. 206, and gave (page 29) the same explanation of the purpose of this section as did the committee on ways and means. It isclear that Congress merely provided for reimbursement from theestate of a deceased recipient who had through error or fraudreceived overpayments during his life time. And the only purpose of our Legislature in enacting that portion of what now is section 4 of c. 118A relative to reimbursement, other than from bond or mortgage, from the estate of a recipient of aid, was a declaration of the public policy of this Commonwealth that when recovery was had one half of the proceeds would be paid to the national treasury. [Citing authorities].

    "Under that law there can be no recovery where payments were not made by accident, fraud or mistake." (Emphasis ours).

    If it is said that Section 24-a furnishes the right of the State to recover from estates "the total amount of assistance paid" to a recipient under the act (Ch. 237, Laws 1947), and that the applicant for assistance was informed of the provisions of the act and acquiesced therein and thereto, there is then established the relationship of debtor and creditor and Sec. 2 of art. 8 of the Constitution, extending credit to an individual, is violated. And, again, if it is said there is no violation of the credit provision of the Constitution, where then, we ask, is the obligation upon the part of the estate to pay. If the recipient of aid, during his lifetime, did not consult and agree, expressly or impliedly, to repay the amount paid him, how can any obligation attach to the estate. With these observations must we not conclude, that the only recovery that is permissible "rests upon the principles of common law and to share in the proceeds of actions where payments have been made through accident, fraud or mistake." There is another matter I feel disposed to mention, and which our legislature seemingly overlooked in enacting Sec. 24-a, supra, and is unnoticed in the majority opinion, and that is this: This jurisdiction is one of the eight community property law states. All property acquired after marriage by either husband or wife, (Sec. 31-907, I.C.A.) is community property. *Page 247

    Husband and wife are equal partners in community estate. Kohny v. Dunbar, 21 Idaho 258, 121 P. 544, L.R.A., N.S., 1107, Ann.Cas. 1913D, 492; Peterson v. Peterson, 35 Idaho 470,207 P. 425.

    Wife's interest in community property is vested interest of same nature and extent as that of her husband. Muir v. Pocatello, 36 Idaho 532, 212 P. 345.

    No distinction is made between husband and wife as to degree, quantity, and nature or extent of interest each has in community property. Ewald v. Hufton, 31 Idaho 373, 173 P. 247; Peterson v. Peterson, supra.

    Upon the death of either husband or wife, one-half of all community property shall go to the survivor, subject to the community debts, etc. In case no testamentary disposition shall have been made by the deceased husband or wife of his or her half of the community property it shall go to the survivor, (Sec. 14-113 I.C. A.) subject to the community debts, etc. A recipent of old-age assistance cannot create a liability against the community property without the husband or wife, if such there be, joining in the encumbrance incurring such liability.

    In the instant case the doctrine of primary jurisdiction is particularly applicable for the reason that section 24-a, Session Laws 1947, providing for a recovery from a recipient of old-age assistance places the discretion thereof within the state department, an administrative jurisdiction.

    The demurrer to the complaint says that it does not state facts sufficient to constitute a cause of action. The trial court sustained the demurrer without leave to amend and dismissed the action. In so doing the court was right. He had no original jurisdiction of the controversy and could entertain the same only in his appellate capacity. Furthermore, Section 24-a, Session Laws 1947, was void in that there is no provision for recovery under the Social Security Act which is necessary because of the cooperative functions and efforts of government and state laws. The aforementioned state statute is not in harmony with the Federal social security laws and for that reason must be disregarded as all acts of the Social Security Act, and the Public Assistance Act, must be administered together as a unified code of laws enacted by Congress and the state legislature for the complete and comprehensive control of the subject. "The matter in the final analysis brings us to the fundamental proposition that the subject of relief in its various phases, as provided by law, was strictly within the scope of legislative authority. That branch of the government very properly and necessarily assumed the function of providing the amount to be expended for that purpose, and the manner and method of distribution. The judicial department has neither power nor inclination to usurp that authority. If inadequate provision has been made for the meritorious necessities of the unfortunate people *Page 248 of the state, we may sympathize personally but we are powerless to intervene officially." State v. Brandjord, supra [108 Mont. 447,92 P.2d 279].

    Plaintiff's action is instituted under the provisions of section 24-a, supra. The record shows that the first payment of old-age assistance was made in March 1943, and that Magnus died about August 1, 1946. The Department of Public Assistance, evidently in construing section 24-a, supra says, no claim may be filed against a home while it is being used as a residence by a surviving spouse. There is nothing in connection with the application for old-age assistance, or otherwise, that discloses that said applicant in becoming a recipient, either expressly or impliedly, contracts to repay any amount paid him by the state. Section 24-a, supra, in the instant case, is retroactive, both as to the 1947 act and, likewise, to the Act of 1943. There is nothing in the complaint, or the record, to advise us as to whether there is a surviving spouse in this case, nor, as to the nature of the estate, if any, of which Magnus was possessed at the time of his death. The "Creditors Preferred Claim," filed by the Department of Public Assistance of the State of Idaho, In the Matter of the Estate of Frans G. Magnus, deceased, recites, "The undersigned creditor of Frans G. Magnus, deceased, herewith presents its claim against the estate of said deceased with the necessary vouchers to Nels Lindstrom, executor of the estate of said deceased, for approval as follows: * * *" The Department of Public Assistance of the State of Idaho granted and paid old-age assistance to said deceased, as per the following itemized statement (following is the monthly date and monthly amount paid Magnus as per the creditors preferred claim which is attached to and made a part of the complaint.) "This claim is made and filed as a preferred claim against said estate under the provision of Section 2, Chapter 119, Idaho Session Laws 1943." It will be observed that the record discloses that the complaint was subsequently amended to show that the amount claimed to be due and owing to the state of Idaho was under the provisions of the Public Assistance Laws as amended by Section 4, Chapter 237, Session Laws 1947, and the provision contained in the claim as being under the Laws of 1943 was not stricken therefrom. The record also discloses that the defendant's demurrer to the plaintiff's complaint was argued and submitted for decision, and sustained without leave to amend and the action dismissed September 26, 1947. That there was a stipulation allowing the amendment showing that the action was prosecuted under the provisions of Section 4, Chapter 237, Session Laws 1947, nunc pro tunc by interlineation and without the same having previously been submitted to the trial court asking that the complaint be reinstated.

    We submit that the order of the trial court sustaining the demurrer and dismissing the action should be affirmed. *Page 249

Document Info

Docket Number: No. 7403.

Citation Numbers: 191 P.2d 1009, 68 Idaho 226

Judges: SUTPHEN, District Judge.

Filed Date: 4/1/1948

Precedential Status: Precedential

Modified Date: 1/12/2023