sixteen dash six two five two and sixteen dash six three six zero in re a state of jerry west versus united states to martin a veterans affairs argument  to exceed fifteen minutes per side mr sturgis you may proceed for the appellant when you are ready please the court a little circle from the department of justice representing the department of veterans affairs and i'd like to if i may reserve three minutes might want to either raise the podium or speak more loudly or raise the the mike you're kind of all  judicial review of veterans affairs decisions that relate to veterans benefits by any court other than the court of veterans appeals and the federal circuit section five eleven applies here because this case concerns whether the estate is entitled to veterans benefits that were due and owing to a veteran jerry west when he died without merit he had them as cash but you can continue ok let's talk about that with those two those two propositions the third basic proposition is that because section five eleven applies here it left a district court with no jurisdiction to do anything other than dismiss the case for lack of subject matter jurisdiction and the only other thing i think you need to know is the probate exception interesting though it may be doesn't change any of that because it's only a prudential doctrine as the supreme court told us in the marshall case  that's the basic proposition that we have before you i think that's all you need to decide i'm prepared to go through that a little more detail of who's got what because judge kessler just said something like they've already got it but as i understand it you've got the money the bank gave it back to you that's correct they shoot an order but you know that's been on you know was taken care of that even though the district court took it the money isn't in anybody's hands in kentucky the money's still in your hands that's correct ok now as i understand it and correct me if i'm wrong if you filed the appropriate form and say if you were the spouse or the children or the funeral home you'd be happy to give somebody else the money it's not that the government once the money is that also fair as long as they're an eligible part of it i mean i'm just saying i know there's before there's the four steps and is there even a timeliness bar on that that is if i don't know if there is a spouse or a funeral home if they said ok fine mr harden hasn't filed the form but we'd like to file the form now would you would that be ok so section fifty one twenty one has a one year statue of limitations presumably if they had read the regs they could have said oh there is a spouse there is a child if the estate paid the funeral expenses then the estate could have filed right that's correct ok so they were at that point they were within the one year statute so they could have filed it shows not to i mean that the illegally interesting thing to me would be if the bank hete and given you the money back and you went into probate court to try to get it then would we would we say you're entitle to go back to veterans affairs but you've got the money they're coming after you that's correct right well you know to i guess talk about the other side of that coin  my understanding please correct me if i'm wrong factually is that these folks actually didn't know about this account being drained or whatever you want to say until the money had actually moved is that i'm in my mistaken in that so i think the answer the question is the treasury department recoup the money from the bank right now i don't know if they need to or they knew about yours i don't have any reason to dispute their supplemental brief says that they got the money back on june fourteenth and the letter to harden's law office is dated june tenth that's not a lot of time but it is some time though right so i think as i understand it on june tenth the state learned that the v a was in that was going to reclaim the brownie but then they that the transfer from the bank to the treasury happened four days later  k i mean did the letter specify any procedure where they could contest this money getting taken out of their account about it i don't think it did but it was a letters from the bank it's not from you right wrecked ok so the concern i have here is i mean property for purposes of procedural due process is is defined by state law i mean i think that's a i don't envy jordan i'm pretty i know it's a rehnquist opinion somewhere now whether it's exclusively state law or not you know i guess i'd have to go back and look but basically it's defined by state law and state law pretty much throughout the country because it's actually part of the uniform commercial code says if you get a check and you deposit it in a clears in the funds hit your account and now they're cash then that is your property and i know the treasury has this reclamation procedure but it seems very odd and troubling to me that potentially with no notice to the citizen the treasury can come in and as a practical matter coerce the bank to transfer money out of a citizen's account to the government with no profit no notice no opportunity no hearing no opportunity to contest that that would seem to be a fairly brazen procedural due process violation but i want to hear why you think i'm wrong there will i think our first response is the plaintiffs never made that you know i don't know about that i think they kind of do but i'm really not it i understand that that's your first sponsor and i understand that's and here i'm interested in the substantive answer so if i could just without annoying is that i think they did in the court of appeals brief i don't think they did below but ok well sort of the question and i understand your point and you know we take that seriously but on the substance this this really frankly kind of bothers me i didn't know this could happen in america that the government can just come in and drain your account and literally checks bouncing and so on you know i mean that's a serious thing so what am i getting wrong in my recollection of procedural due process here well let me just sort of the beginning that there's the federal statute which is now the briefs that authorizes treasury to go through this process thirty one u s c thirty seven twelve right so you're way ahead of me no surprises but that's that's it and then the second thing i would say is that as our brief explains due process when it applies is sometimes satisfied by a post deprivation hearing yeah i've seen that in where you know guys in jail or something and they're docking him for her day in jail i mean is post is it the government's position that post deprivations enough if the government passes some statute that says if if we think you are the government money the treasury can go to the bank and say either you pay us or you pass the easy way or hard way you can transfer it from the citizens account or we're going to take it from your fed account  the banks and any time the government thinks it's owed money goes to the bank they get the money and now the citizen with no notice has to sort of go through some process to get it back is that the government thinks it can do just unilaterally say ok well look you know you're supposed to gets different though but it's not yet property and it's not it cash in somebodies account i mean let's say the government to set figures out that they've been overpaying my law clerks five hundred bucks a month and they work for me f e and it's eleven months and then the government somebody figures out you know we paid this guy five hundred bucks too much and too much a month and so we've overpaid him about five grand and with no notice no nothing  that's a you know you barely had it probably wouldn't even have that much so they take all the money out of the account overnight and that's totally that's fine under the procedure under the due process clause just go in and take the money out of their account so one thing i would say is i think the court should limit its consideration of this issue to the facts of this case and we're talking about veterans bed but i'm allowed to ask hypothetical questions to explore the implications of the government's position but i mean you know you can't take property without due process of law i mean it's a pretty straightforward statement in the constitution and it's property it's taken and so now that the government's position i gather is that post deprivations always good enough not  withstanding the nature of the invasion here is that the government's position i'm not trying to be argument you know like a jerk you know i'm just really trying to understand the government's position is it is that it so our position is that asked you general questions and you said it's the same there and that implies that this case you know of it's ok here it's ok in the cases i asked you about because you said it is so and then but you want to narrow it to it's only here i understand that but it's you know the way we think about this is not just this case and i've never encountered this reclamation thing before but even in this context in one sense it doesn't come out of his account until the bank decides that is you're going after the bank aren't you you're saying bank please pay us some money so presumably he got some kind of know well he did get this notice from the bank that this was going to and then things might have happened there after but as to what happens to his account that's between him and the bank and catholics where their lawyer he might have a due process have some type of contractual claim against the bank is a government's position that the bank is in want to actually taking the money here no no there's a government is taking money from the bank the bank is an instrument of making in heaven but we're not and therefore the district court should dismiss the case rather than remain and back to the state court is that it yes ok ken is that could the district court really do that simply dismiss in light of twenty us the section fourteen forty seven because that statue states that when the district court lacks subject matter jurisdiction the case shall be remanded period and just doesn't empowered a district court to simply dismiss it says the case has to be remanded which would mean that even if there were no subject matter jurisdiction the district court would have to remand correct the section five eleven i if there's no subject matter jurisdiction following a removal and section fourteen forty seven says that in those circumstances the district court has to remain and so what we're saying i so if you're going to refer me back to section five eleven then i won't i won't pursue the matter with you well i further if i could sure i think the answer is that fourteen forty seven which would otherwise  preclude a dismissal and require remained doesn't require that here because if if that were the case you'd be remanding to a court the kentucky probate court that doesn't have jurisdiction so it can't be that fourteen forty seven appeals and subset and subsequently on the way to the supreme court if necessary but that's exactly what congress and enacted section five eleven to preclude these get these questions are supposed to be decided in federal court yes on this question of fourteen forty seven as i understand it and correct me if i'm wrong or my colleagues or your adversary can correct me fourteen forty seven d says an order mandane to the state court is not reviewable on appeal or otherwise except that an order re mandane to a case which was removed pursuant to fourteen forty two shall be reviewable by an appeal and i thought your position was that you removed it under fourteen forty two and so you could get this review on appeal so thank you judge abbas i think that's a far better answer and the only one to the question that was asked fourteen forty seven d is the applicable part of fourteen forty seven and it sets it sets out a procedure for what happens when a case is removed under fourteen forty two and it in a case it's removed under a different statute then you would be in the scenario that you all have described where the a prior to the appropriate nothing kerry thinks speaks for itself i think the place to really start or the two questions that you all pose for both parties for the supplemental briefs i think those two questions kind of encapsulate  this case really well and gets to the to the kernel of the case now as we did argue in our supplemental brief you know it's our position that this retroactive disability payment was fixed and no longer subject to feel that there was some error in the amount or something that was miscalculated and there's nothing to show in the record that the v a initiated any of those kind of proceedings and in most importantly course the probate exception that we've talked about a lot and  fire to this whole powder keg if you will so does that mean the generically the for probate court decides that the government of those of us any a state money they can issue an order to the to the government no matter what the regulatory system is and there's no way to get it into federal court we're not under that broad of a description i think it has to be a nasa that actually has been identified as affairs and from there to be appropriate federal court courts but that that their procedure doesn't contemplate in a decision by the state benefits and as i interpreted all the arguments made by the government and all the legal authority they sided they all seem to gravitate around determination of benefits you know what is over what is not not  the mouth that was determined that was awarded and then subsequently as and as we are not you you're right that they're not complaining about the amount but that because he died it's not the government wants the money the government wants it to go according to the scheme right spouse children parents and then expenses right now and only if all of those failed with the government say that they get  or that takes us back to these thirty eight us c fifty one twenty one which of course was never argued by the government at the district court level but i think if they're allowed to argue that a new in these proceedings you can't look at fifty one twenty one in isolation i think you have to look at it in context thirty eight u s c fifty one twenty two which more closely resembles the scenario where you're talking a crude benefits you know i think what this fifty one twenty regulations until the appeal because again they were never argued by the government at the district court level when they finally wanted to get when you got the letter from the bank though you might afford it there was something going on it's interesting you say because if you if you examine the record the letter from the bank was dated june tenth two thousand and fourteen the account and this is also referenced in the district court's memorandum in order the money was confiscated from my old cabinets are pulled client asked for account on the sa day june tenth that is in the record so in other words when i got the letter from the bank that says you know we've received this notice to reclamation and then i get it was interesting i remember not to notice that i was in the  sent you something that said that was happening and i mean their brief says it was the they got the money on the fourteenth is that the difference the bank i don't know would have about seen around for the four days are you do you speak i don't know the administrative process once it's taken out i know and we did argue this and the like said it's the data reference in the district court or the letter from the bank was dated june tenth remember it specifically exact been on vacation in june so in july i come back and i also was reconciling my bank statements and guess when the money was taken out june tenth there was absolutely zero time to contest the taking of this and we're not talking just a citizen's account this is our i old cow this is a state overseeing state right i mean the state draw the old account exactly but so that was really the burr under my saddle is like there was no notice june tenth was the date of course and i'm not going get the letter on june tenth i got it a few days later and the money was already gone now did you ever think about trying to get the congress's attempts were liberalized fifty one twenty one because i'm reading verbatim the last sentence of fifty one twenty two says any amount not paid in the manner provided in section fifty one twenty one which the government relies on for the first time in these proceedings shall be paid to the a state of the deceased pay unless the estate will is cheat and there's the facts don't warrant that it is she to the estate because we're goddess of section fifty one twenty two are we trying to r decided by state court pursuant to a to the probate exception so even if you're right about that you have to explain why beeman doesn't imply well being of course are totally separate facts and that of all the cases there is no fact pattern like this fact pattern this is a completely a case of first impression where you well wait a minute now you're talking about veterans benefits and so it's a matter of who's entitle to the benefits in terms of dependents or survivors of veterans which is what is addressed by section five hundred eleven b which would bring the whole matter well yeah i mean i think there's some real constitutional question marks about the statute as it's being applied i mean the way the government's applying there seems to be no end that neither the regulations can be challenging or even  to the v a has determined that the money does not flow directly to the estate the they've determined that it should go by the statutory order presumably you could have you could have gone to the court of veterans appeals and either say that's unconstitutional or the ex wife is nicer than the estranged daughter or you could have said anything and then you would get review in the veterans appeals in the federal circuit and the supreme court right well batin giulietta process out there was eventually biting the fact that the congress passed fifty one twenty two they acknowledge that there could be substantial injustice with the way fifty one twenty one is applied and if you read fifty one twenty two then you say it does something about fifty like real checks that you know that you'll not understanding your point and with your check be returned to the issuing office and cancelled unless negotiated by the payee or the duly appointed representative of the pays a stay that's the very first that's what happened here the government's arguing well they should have returned the check well stuff happens missy let's even assume it was a mistake we're not arguing it is let's say the executor it's in dorset by mistake there still has to be due process in an orderly way for the government to recoup that money and once the probate courts tentacles are in it the state court has determined what's been identified on the petition they in good faith believe it was probate a bill that was the avenue for the government and they had notice an opportunity to attend t probate proceedings and make those arguments and who know they might have won if they made the arguments here they district court the probate court the judge may look to me and said mr ard but so they're taking that then thirty one c thirty seven twelve which allows reclamation is a null a plea bargain that was never argued at the lower level we've we've yet to see any of the a briefing what actually was the legal authority for the government to confiscate the money from an aisle that count in the fashion that they had so i can't sit here today and say that they even followed those reclamation rules but i know we didn't have a notice an opportunity to be our nominee whether they follow the rules is one thing whether this whole thing violates one's right not to have your property taken without due process is another quite well i would say really kind of summarize the think we're getting low on time for the bottom line is three points a really have to make is number one you know we're not asking for this court to create a new law or to change existing law i think this case is certainly governed by mark and the alan it's the law of the land it's been relatively unchanged for seventy plus years the district court took custody of this money as you can argue should they or should they have not but when you look at like said thirty eight u s c fifty one twenty two congress even figured you know there's going to be substantial injustice here we need a provision that may cover even a mistakenly endorsed well when you say that they they've taken custody of it says a federal court in i'm quoting from markham may not exercise its jurisdiction to disturb or affect the possession of property in the custody of a state court and if the money's been returned to the vs how is it in the custody of the state court at the time that we're concerned about it in other words i think there'd be a very interesting question if they hadn't gotten the money i guess it would be like once the hostage taker lets the hostage go why are we concerned about well but that's i mean part of the thing is you don't want the probate exception in its probate court says well they should have paid us some money so therefore we have custody of it well i think that's not given much respect to the state probate court i mean that they're going to look at these cases with with with diligence and i think in this one you know you get a proper filing a petition but you're really saying that the words should be property in the custody or that ought to be in the custody of the state court it was in the custody of the core when you had this illegal confiscation and nowhere market is even require you know a physical custody as an officer of the court and being in a in an aisle to count that is overseen and regulated by the state bar it's  essence the same as if it was in well but that would be more like you should have brought an action saying that the government's action back then violated market will i think we took the appropriate action i mean the filing that we make or would have been the same type of filing we would have done if it was a private creditor that had come in and basically taken assets away i mean between twenty fourteen and twenty sixteen the the actual order to the beds by the state court was when it wasn't like twenty months later twenty months from from the time of let's say the nasty letter from the panic no i did yeah there was a time lag because we did try to attempt to resolve this extrajudicial way this was the series of phone calls because again we were sort of at a loss again the letter did not come from the v a and if this comes circled back to five eleven it talks about decisions by the secretary in the midst time they told you how to get the money or how these other people could get the money presumably if you're just a lawyer for the estate you want your state to get the money but you didn't want to go into the administrative process maybe you thought you had a better a better avenue but you knew that there was an administrative problem my actions as was the executors are guided by the probate laws of kentucky and we believe it was a probate able last and then we took the appropriate action but but again we're not asking for for new law to be created or a change of existing law we're not asking for anything that would unnecessarily burden the v a we're asking what in our opinion would just be a legal and fair result and what's legal is is applying the probate exception as  honor we believe that the council is reading a limitation to section five eleven isn't there they try to limit the section to what they call the determination and i think what they mean is in a term in initial ratings determination about whether a veteran is is  is this able and needs the money but that's not what the statute says if you're reading statutes today what it says is the secretary shall decide all questions of law in fact necessary to a decision by the secretary under a law that affects the provision of benefits by the secretary to veterans ok so we have a decision here the secretary decided that because jerry west died before the check was issued that the state is not entitled to the money ok that's a decision second question is there only was it just to be clear is that relying on the fact that he died before it was issued not just that he died before it was negotiated correct and this is this gets into the question of whether state courts don't have jurisdiction about but fifty one yeah and that you know i mean eligibility questions are one thing i mean when it's already somebody's property that's that's a different situation so let me say this there's nothing in the statu says section five eleven doesn't apply when the v a is reclaiming benefits so again what they're trying to do is import something into the plain language of statutes not there no i mean it's again i mean you know the concern i would have is that once it becomes property in the constitutional sense we're in a different situation than before that before then i don't really have much core of what you're saying jurisdictional but once it becomes property then there are certain protections of the constitution provides you let me ask you this question would you agree that the money in the account was property at the time it was taken out what i would agree is that of gratuitous benefits is determined by federal law and not state law which we have a federal statute that authorizes treasury do exactly what they did and i think that's perfectly constitutional if i could just tack back to fifty one twenty two briefly again in reading statutes here they read it but they didn't tell you the important part of it fifty one twenty two says the following a check received by a pay ok well west didn't receive check he's deceased what the wilkes case that we decided we cited are brief says so fifty one twenty two only applies when a check is issued at the time the recipient still li deceased person can't receive a check so fifty one twenty two applies as a will states not the payee in your i'm sorry the estate is not the payee in the terms of that language their records it's no that's right was reminding him beeman was the money already in the person's account so beeman it was a different kind of recall whether it was or together if you recall was it already money in somebodies account no so that's a different case i'm not saying i'm the substantive issue of whether the government is entitled to get the money back that you have a problem i'm just saying that once it becomes property you have to do some process unless i'm missing something and just because thirty seven twelve says what it says doesn't mean that the fifth amendment doesn't say what it says i know i know this is startling to the government but i was startled when i read what happened here and i'm trying you have any idea of the sequence of the passage of thirty seven twelve thirty one u s c thirty two well as opposed to five eleven i'm just i'm just curious your ia says to whether you know thirty one u s c thirty seven twelve was a bunch of guys set down and decided ok we're going to violate the fifth amendment by allowing the government to reclaim money or whether it was just a way of enforcing five eleven well i've said this before and it's not satisfactory to you but you know airily i'm i'm not going to say well at least go ahead and you may want to go back to washington and say that that some people looking at thirty seven twelve kind of funny i'm not all i'm saying is i haven't already decided it's not satisfactory i'm telling you in trouble and but i want to hear what you have say police say well i think what i'm trying to say is again our our basic position is that even if you are troubled this is not the case to wri that because the plaintiffs did not raise a due process claim in the district court and thereby did not properly preserve it's not you're the you're this is the unusual case where you're the a power and so you know we have some latitude in that regard what's so there may be additional arguments maybe that i mean it's one judge bosses question by saying i don't know the answers there may be an additional ground we could defend the due process claim on i don't know that we haven't had a chance to take a position on that i mean you had an opportunity to have a section says these states due process claim fails on the merits and that's right and some point you know if we think or if one of us thinks that's fairly presented you know we can address that's going to have just one second to talk about page eight o three and then i'll stop the court said this the doctrine of prior exclusive jurisdiction which is the doctrine that is relevant in this case applies only to state court previously exercised jurisdiction over that same property and here's the key language and