The opinion of the court was delivered by: Sifton, District Judge.
This is a motion to review a final determination of the
Secretary of Health and Human Services ordering cessation of
Social Security benefits to the plaintiff. The record before
the administrative agency establishes the following.
Plaintiff, Dennis Wonica, was found to be eligible for
social security benefits due to a herniated lumbar disc as of
October 1982. However, based on information received
thereafter that the plaintiff had been receiving income in
excess of $300 per month as a result of his work as a real
estate sales agent, the Secretary ordered plaintiff's benefits
terminated. At plaintiff's request, a hearing was held with
respect to the termination before an administrative law judge
at which plaintiff testified to the circumstances surrounding
The ALJ determined the facts and resolved certain legal
issues which I will deal with later in the opinion. The ALJ
found, inter alia, that the plaintiff's testimony "lacked
credibility at several points, with clear contradictions in
facts and obviously self-serving statements, plus a general
lack of candor beyond the elementary facts." Tr. p. 12. The ALJ
held that, notwithstanding a lack of improvement in plaintiff's
medical condition, "the claimant's work activity as a licensed
real estate person with commissions from listings averaging
over $300.00 a month constituted substantial gainful activity."
Tr. p. 13. Plaintiff's benefits were accordingly terminated.
On April 4, 1990, the appeals council denied review of the
ALJ's decision, thereby making the opinion a final
determination. This action ensued.
The plaintiff raises three issues in this action, the first
relating to the Secretary's factual findings; the second
involves the defendant's alleged failure to follow its own
regulations on reinstating benefits; and the third concerns
the effect of administrative res judicata as establishing a
right to uninterrupted benefits. I will deal with these issues
Plaintiff's principal contention is that the ALJ's
determination that benefits should cease in light of
plaintiff's substantial gainful activity as a real estate
agent was not supported by substantial evidence. Of course, a
district court must accept the findings of the Secretary as
"conclusive" unless they are not supported by "substantial
evidence." 42 U.S.C. § 405(g). In Richardson v. Perales,
402 U.S. 389, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971), the Supreme
Court held that "substantial evidence" means "`more than a mere
scintilla . . . [i.e.] such relevant evidence as a reasonable
mind might accept as adequate to support a conclusion.'" Id. at
401, 91 S.Ct. at 1427 (citations omitted). Thus, the standard
of review of the ALJ's factual findings is quite deferential.
As a general matter, a person's benefits may be discontinued
where the Secretary determines the person no longer disabled.
20 C.F.R. § 404.1520(b). This determination may rest on a
finding that the claimant has performed "substantial gainful
activity," 42 U.S.C. § 423(d)(4), as that phrase is defined by
the Secretary. Under the regulation covering the years
1979-1989, where a claimant earns in excess of $300 per month,
20 C.F.R. § 404.1574(b)(2)(vi), a rebuttable presumption arises
that the claimant is no longer "disabled" for the purpose of
Plaintiff argues that the Secretary's decision was not
supported by "substantial evidence" because the presumption
raised by the amount of money plaintiff earned was rebutted by
evidence that plaintiff's medical condition had not changed
since he was initially awarded benefits. In short, plaintiff
contends that a person can rebut the presumption of
"substantial gainful activity" by demonstrating an ongoing and
severe medical condition. Plaintiff relies on Hanes v.
Celebrezze, 337 F.2d 209 (4th Cir. 1964).
Although the mere existence of a continuing and severe
medical condition cannot rebut the presumption that a person
earning more than the specified amount is performing
"substantial gainful activity," the social security
regulations do contemplate the Secretary considering "how
well" a claimant does his or her work in determining whether
or not "substantial gainful activity" has been performed. 20
C.F.R. § 404.1573(b). In particular, the regulation provides:
"If you are unable, because of your impairments,
to do ordinary or simple tasks satisfactorily
without more supervision or assistance than is
usually given other people doing similar work,
this may show that you are ...