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July 31, 1986


The opinion of the court was delivered by: MCLAUGHLIN


McLAUGHLIN, District Judge

 This is an action brought under section 205(g) of the Social Security Act, as amended (the "Act"), 42 U.S.C. § 405(g), to review a final determination of the Secretary of Health and Human Services (the "Secretary"), which found that plaintiff had been paid excess mother's insurance benefits, 42 U.S.C. § 402(g) ("mother's benefits"), by the Social Security Administration ("SSA"), and denied her a waiver of recovery of the overpayment.

 In 1981, the plaintiff was notified by the SSA that between December 1967 and November 1980, she had received overpayment of other's benefits in the amount of $17,248.20 (Transcript of Administrative Proceedings ("Tr.") 71-73). The amount of the overpayment was reduced to $5005.60 because of underpayments of wife's benefits paid to her on the account of her second husband (Tr. 71). Plaintiff's request for a waiver of the overpayment was denied, and the denial was upheld on reconsideration on April 1, 1983 (Tr. 97-100).

 The plaintiff then requested a hearing, which was held on August 25, 1983 (Tr. 30-48). The Administrative Law Judge ("ALJ") before whom plaintiff and her paralegal representative appeared considered the case de novo. On July 6, 1984, he decided that there had been an overpayment in the amount of $17,248.20, which was reduced to $7,114.20 after underpayments and withholdings were deducted. He also decided that recovery of the overpayment could not be waived because the plaintiff was not without fault in causing it (Tr. 22-26). The decision of the ALJ became the final decision of the Secretary when it was approved by the Appeals Council on March 29, 1985 (Tr. 4-5).


 Plaintiff Angelina Priolo is a sixty-nine year old widow who lives with and cares for her only child, forty year old Joseph Sebastiano, at their Brooklyn home. Joseph is the son of the plaintiff and her first husband, Anthony Sebastiano, who died in 1957 (Tr. 7-10, 59). Joseph requires full-time care because he is emotionally and mentally retarded and retains no bowel or bladder control.

 Mrs. Priolo's case is complicated. After the death of her first husband, she applied for and received mother's benefits beginning in 1957, based on her deceased husband's account. Her son received child survivor's benefits and disability benefits, also drawn on his father's account. Both mother's and child's survivor benefits were terminated in 1963 (Tr. 53), when Joseph reached the age of eighteen. That year, too, Joseph was hospitalized -- with his mother's reluctant consent -- after several suicide attempts. He remained hospitalized, with brief, temporary, exceptions, until 1973 (Tr. 128).

 In 1967, four years after Joseph's hospitalization, the plaintiff married Louis Priolo (Tr. 119). She did not report the remarriage to the SSA. Mrs. Priolo testified that in 1973, an SSA worker whose name she cannot recall told her that if she were to care for her son at home, and if she stopped working, she could again receive mother's benefits (Tr. 37, 42, 81). Relying on this erroneous information, the plaintiff left her job and reapplied for the benefits. On the application form, she used the last name "Sebastiano," the name of her son, Joseph, for whom she was caring and of the father from whose account the benefits would be drawn (Tr. 54). Where the application asked for information on her "last marriage," she referred to her "prior file" (Tr. 54).

 Thus, the SSA did not learn of the plaintiff's 1967 remarriage -- an event that would have terminated her mother's benefits according to 20 C.F.R. § 404.341(b)(3) -- until 1980, when her second husband died. According to the plaintiff, she returned his retirement check to the Administration the month he died, and "all [her] troubles started" (Tr. 81). The government claims that it learned of her new marital status when she applied for benefits from her second husband's account.

 The SSA claims that the plaintiff was at fault in not reporting her remarriage in 1967 (when she remarried), or in 1973 (when she reapplied for mother's benefits), and thus caused the alleged overpayment herself. The ALJ agrees. The ALJ and the SSA do not concur, however, on either the time period or the amount of the alleged overpayments. A Social Security Administration notice of October 1981 states that the plaintiff was overpaid $17,248.20 from December 1967 through November 1980, with the debt reduced to $5,005.60 by deducting underpayments from Mr. Priolo's account (Tr. 71). In 1983, the SSA reviewed the records and found that the plaintiff was paid benefits "for June 1970 through August 1970, and from July 1973 through November 1980" (Tr. 100). The SSA conceded that the plaintiff had not been paid benefits from 1967 to 1969. Nevertheless, the SSA still thought she had been overpaid $17,248.20. After subtracting underpayments and withheld payments, the SSA determined that Mrs. Priolo now owed $7,100.80 (Tr. 99).

 The ALJ's finding is even more confused. The ALJ first finds that Mrs. Priolo was "not entitled to benefits beginning with the month of December 1967 through November 1980" (Tr. 25). Later in his findings (Tr. 26), the ALJ stated that the period of overpayment was "May 1973 through November 1980," although he had already stated that "the claimant was properly entitled to mother's insurance benefits . . . from May 1977 through September 1980" on her second husband's account (Tr. 25). Regardless of the length of time during which she was allegedly overpaid, however, the ALJ consistently finds $17,248.20 in overpayments, less $9,926 in underpayments and $208 already withheld, for a total of $7,114.20.

 According to Mrs. Priolo's testimony, she did not report her 1967 marriage to the SSA because she herself was no longer receiving any benefits (and had received none for four years), and believed that her remarriage had no effect on her son's disability benefits. She did not report the remarriage in her 1973 reapplication for mother's benefits because she understood that she was entitled to them as long as her sick child was in her care (Tr. 11, 44). She testified that she had no idea that her new husband was responsible for her son Joseph's support (Tr. 42). Indeed, her new husband never claimed either Joseph or Mrs. Priolo as dependents on his tax returns (Tr. 11).

 Plaintiff in her brief states that she used her first husband's name when reapplying for mother's benefits in 1973 because she wanted to emphasize the relationship between herself and the man whose account would provide the ...

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