decided: November 15, 1978.
GENNARO BASCIANO, INDIVIDUALLY AND ON BEHALF OF ALL OTHER PERSONS SIMILARLY SITUATED, PLAINTIFF-APPELLANT,
HAROLD HERKIMER, INDIVIDUALLY AND AS EXECUTIVE DIRECTOR OF THE NEW YORK CITY EMPLOYEES' RETIREMENT SYSTEM AND HEAD OF THE BUREAU OF RETIREMENT AND PENSIONS, ET AL., DEFENDANTS-APPELLEES.
Appeal from a judgment entered in the Southern District of New York, Charles M. Metzner, District Judge, on a motion for summary judgment by the City of New York, dismissing the complaint of a former City employee who claimed that the City's procedure for determining his eligibility for accident disability retirement benefits deprived him of due process of law. Affirmed.
Before Friendly and Timbers, Circuit Judges, and Hoffman, District Judge.*fn*
This is an appeal from a judgment entered in the Southern District of New York, Charles M. Metzner, District Judge, On a motion for summary judgment by the City of New York, dismissing the complaint of a former City employee who claimed that the City's procedure for determining his eligibility for accident disability retirement benefits deprived him of due process of law.
For the reasons below, we affirm.
The facts are straightforward and not in dispute. Both sides moved for summary judgment below.
On February 27, 1973 Basciano sustained a back injury while employed as a laborer by the City's Department of Water Resources. He was engaged at the time in pulling rods from a sewer in Brooklyn.
A week after the accident Basciano reported his back pain to his own doctor. The latter found the x-rays normal but diagnosed Basciano's condition as a paralumbar muscle spasm with resulting tenderness in the lower back. The doctor advised Basciano to rest at home, recommended a course of physical therapy, and told him not to return to work. Basciano's condition thereafter was re-evaluated periodically by his doctor whose final diagnosis was chronic back spasm. Basciano did not return to work.
On November 21, 1974, twenty-one months after the accident, Basciano applied for accident disability retirement benefits under the City's Employees' Retirement System (the System). In support of this application he submitted reports of seven doctors regarding his alleged disability, together with statements from his co-workers and his supervisor concerning the accident.
On April 29, 1975 Basciano was interviewed by the Chief of the System's Medical Division concerning his employment status and the circumstances of the accident.
On June 12, 1975 he was examined by three doctors from the System's Medical Board (the Board). During this examination the doctors probed the area around Basciano's injury and instructed him to perform a number of movements. Their report noted that motion in his lower back was restricted, that he complained of tenderness, but that there was no spasm (contrary to the diagnosis of Basciano's doctor). On the basis of this examination and the medical history, the Board concluded that Basciano was not disabled and therefore was not eligible for accident disability retirement benefits.
The Board's report was forwarded to the System's Trustees who denied Basciano's application on August 15, 1975.
The Trustees thereafter advised Basciano that he had the right to examine the evidence used by the Board in reaching its decision. He did so. After reviewing the evidence he requested the Board to reconsider its decision. He also submitted additional evidence not previously considered by the Board.*fn1
On November 23, 1976 Basciano again was examined by three doctors from the Board, none of whom had participated in Basciano's prior examination. They again found some restriction of movement but no muscle spasm. The Board affirmed its prior decision that Basciano was not disabled and recommended that his application for disability benefits be denied.
On January 23, 1977 the Trustees accepted the Board's recommendation and affirmed the Trustees' prior denial of benefits to Basciano.
On May 17, 1977 Basciano commenced the instant class action*fn2 pursuant to 42 U.S.C. § 1983 (1970) seeking declaratory and injunctive relief. Among other claims, he asserted that the City's failure to grant an opportunity for a hearing to applicants who are denied accident disability retirement benefits violates the due process clause of the Fourteenth Amendment.
Upon cross-motions for summary judgment, the district court on December 13, 1977 filed an opinion holding that Basciano's interest in accident disability retirement benefits is protected by due process and that the System's procedure satisfied the requirements of due process.
From the judgment entered December 15, 1977 on Judge Metzner's opinion, the instant appeal has been taken.
Basciano challenges on due process grounds the constitutionality of the procedure pursuant to which he was denied disability retirement benefits under the City's retirement system. This requires an analysis of the relevant provisions of the Administrative Code of the City of New York (the Code), which are set forth in the margin.*fn3 Such analysis is rendered somewhat difficult by the obscurity of those provisions. Nevertheless, the following is a brief summary of the procedure provided by the Code and the procedure pursuant to which Basciano's application was processed in the instant case, as stated above.
Section B3-40.0 of the Code sets forth the procedure for determining whether a City employee has become physically or mentally incapacitated for further work as the result of an accident sustained while working as a City employee. Such determination in favor of the employee is a necessary predicate for awarding him disability retirement benefits.
The determination required by § B3-40.0 is made by a Medical Board (the Board) composed of three physicians in accordance with § B3-13.0 of the Code. The applicant for disability retirement benefits must submit to a medical examination and investigation by, or under the supervision of, the Board. The applicant may submit documentary medical evidence to the Board before his medical examination.
If the Board finds that the applicant has sustained an accident disability as the result of his City employment, it so certifies to the Trustees who are constituted in accordance with § B3-2.1 of the Code. In such event, the Trustees are required to retire him for such disability.
If, however, the Board makes a determination adverse to the applicant, the latter may review the evidence relied upon by the Board and may request reconsideration upon a showing of new evidence. The Trustees in such event may refer the case back to the Board for re-evaluation. The Board then may require the applicant to submit to a further medical examination.
In arguing that this procedure is constitutionally inadequate, Basciano contends that an application for disability should not be denied on the basis of a Board examination until the applicant is given a full hearing before an impartial decision maker. At such a hearing, Basciano contends, the applicant should be entitled to subpoena physicians, to testify himself, and to present other evidence on his own behalf.
We shall discuss below Basciano's contentions, as well as other aspects of the procedure which appear to be bothersome both on the face of the Code and as applied here.
Before turning to the central issue in the case whether the City's procedure for determining eligibility for accident disability retirement benefits deprived Basciano of due process of law we must decide preliminarily whether his interest in those benefits is of such a character as to warrant due process protection.
The district court held that Basciano's interest in such benefits is protected by due process. We agree. Those who meet the eligibility requirements of the City's Employees' Retirement System are entitled to disability retirement benefits under the Code. Where a scheme such as this gives rise to a valid claim of entitlement to a benefit, a property interest protected by the due process clause of the Fourteenth Amendment is created. Memphis Light, Gas and Water Division v. Craft, 436 U.S. 1, 9-12, 56 L. Ed. 2d 30, 98 S. Ct. 1554 (1978); Board of Regents v. Roth, 408 U.S. 564, 577, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972).
We hold therefore that Basciano has satisfied the threshold requirement of establishing an interest entitled to due process protection.
This brings us to the central issue in the case as stated above whether the City's procedure for determining Basciano's eligibility for accident disability retirement benefits deprived him of due process of law. The district court held that it did not. We agree.
We look for guidance to Mr. Justice Powell's formulation in Mathews v. Eldridge, 424 U.S. 319, 47 L. Ed. 2d 18, 96 S. Ct. 893 (1976), of the three distinct factors to be analyzed in determining whether administrative procedures are constitutionally sufficient:
"First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally the Government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail." 424 U.S. at 335.
The issue in Mathews was whether due process required an opportunity for an evidentiary hearing before termination of Social Security disability benefits. Mr. Justice Powell's formulation set forth above took account of the Court's prior decisions, including Goldberg v. Kelly, 397 U.S. 254, 263-71, 25 L. Ed. 2d 287, 90 S. Ct. 1011 (1970). Moreover, as we also were reminded in Mathews:
" " "Due process," unlike some legal rules, is not a technical conception with a fixed content unrelated to time, place and circumstances.' Cafeteria Workers v. McElroy, 367 U.S. 886, 895, 6 L. Ed. 2d 1230, 81 S. Ct. 1743 (1961). "Due process is flexible and calls for such procedural protections as the particular situation demands.' Morrissey v. Brewer, 408 U.S. 471, 481, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972)." 424 U.S. at 334.
In the instant case we look first at the private interest affected by the official action. While Basciano had a substantial interest in the outcome of the proceeding, his interest was less compelling than that of an individual denied by government action the "very means by which to live". Goldberg, supra, 397 U.S. at 264. As the Court observed in Mathews, supra, 424 U.S. at 340-41, eligibility for disability benefits does not turn on financial need. Here, Basciano has received a Workmen's Compensation payment and Social Security Act disability payments. See note 1 Supra.
The adequacy of the present procedure provided by the Code, and the potential value of additional or substitute procedural safeguards, depends largely on the purpose of the inquiry. In order to establish an applicant's eligibility for accident disability retirement benefits the Board must determine that: (1) he is "physically or mentally incapacitated for the performance of city-service," (2) "as a natural and proximate result of an accidental injury received in such city-service," and (3) "such disability was not the result of wilful negligence on (his) part." Code § B3-40.0. Here Basciano submitted uncontroverted affidavits by his co-workers that his injury resulted from an on-the-job accident; it is not claimed that his injury resulted from negligence on his part.*fn4 Consequently, the purpose of the inquiry was essentially to make a medical determination as to whether Basciano's physical condition incapacitated him for the performance of city-service. The medical examination was made by a medical board composed of three physicians, constituted in accordance with § B3-13.0 of the Code. Their responsibility was to make a medical judgment, not to function as adversaries or advocates. The fairness of this eligibility determination therefore turned on the reliability of the Board's conclusion, not on questions of witness credibility.
Certain aspects of the procedure provided by the Code and followed in the case of Basciano tend to assure reliability of the Board's conclusion. First, Basciano availed himself of the opportunity to present the opinions of his own doctors; these were considered by the Board in connection with its first examination. Second, he later was permitted to present further evidence to the Board in support of his request for reconsideration of its initial decision. Third, he was examined by six different doctors on behalf of the Board.
Despite all of this, Basciano has never indicated in what respect the Board's specific findings were incorrect. A mere difference of opinion between Basciano's doctors and those who examined him on behalf of the Board concerning the ultimate issue of disability does not establish that the Board's decision was unreasonable. Moreover, Basciano has never specified in what respect, if any, the present procedure resulted in an erroneous determination.
We are not persuaded of the value of the additional or substitute procedural safeguards which Basciano asserts are required by due process. The gravamen of his complaint is that subsequent to his initial medical examination he was not given a hearing before the Trustees; and that the Trustees were required to accept the findings of the Board.*fn5 Consequently, according to Basciano, he had no way of challenging the effectiveness of the examination or of insuring that the examining physicians actually considered the evidence submitted in support of his application. Absent such a hearing under the present procedure, Basciano asserts that he could not cross-examine the Board members. Moreover, he contends that, because evidence in support of his application could be submitted only prior to the initial examination, he had no opportunity to rebut the Board's initial findings.
While questions of credibility and veracity often are best resolved in a trial-type hearing, we believe that evidence relevant to a medical determination can be presented as effectively in writing as orally. Moreover, the value of cross-examination to discredit a professional medical opinion at best is limited. A trial-type proceeding before the Trustees presumably would require the resolution of conflicting medical opinions by lay administrators. We know of no evidence that this would assure a more reliable final determination sufficient to make this an element of due process.*fn6
Basciano contends that only at such a hearing could he have presented evidence to rebut that relied upon by the Board. This overlooks that prior to the initial examination Basciano himself provided all the evidence relied upon by the Board (other than its own examination) and had the right, which he exercised, to present further responsive evidence on an application for reconsideration.
Basciano also asserts that such a hearing would have enabled him to cross-examine the members of the Board concerning the propriety of their examination techniques and the sufficiency of their findings. As a practical matter, as part of his request for reconsideration submitted to the Trustees, he could have challenged the thoroughness of the examination or the weight accorded specific evidence. In any event, in view of the availability of his prior medical history and the nature of his injury, the record does not support his characterization of the examination as "cursory".
We hold that Basciano has not established his claim of inadequacy of the present procedure as applied to him; and that he has failed to demonstrate that additional or substitute procedural safeguards would have enhanced significantly the accuracy of his eligibility determination.*fn7
Finally, our conclusion as to the adequacy of the City's present procedure is consistent with the City's very substantial interest in avoiding the administrative cost of setting up a procedure for trial-type hearings which we are satisfied ultimately would contribute very little to the accuracy and reliability of eligibility determinations. The City's interest in avoiding such administrative costs is particularly strong here since such costs presumably would have to be borne by the Retirement System.
To summarize: The City's present procedure provides for a reasonably reliable determination of eligibility for accident disability retirement benefits. A trial-type hearing before the Trustees would not enhance significantly the accuracy of a disability determination. While the interest of the individual in receiving benefits is significant, the City has a substantial interest in avoiding the administrative cost of any unnecessary procedure. We conclude that the City's present procedure satisfied the requirements of due process in this case.*fn8