Opinion ID: 584224
Heading Depth: 1
Heading Rank: 2

Heading: analysis

Text: 4 Courts may grant an attorney's fee, not in excess of 25 percent of the total of the past-due benefits to which the claimant is entitled by reason of such judgment. 42 U.S.C. § 406(b)(1). As Section 406 does not define past-due benefits, in 1980 the Secretary by regulation defined past-due benefits as benefits which have accumulated due to a favorable administrative or judicial determination or decision. 20 C.F.R. § 404.1703. Thereafter, Congress passed the Social Security Disability Benefits Appeals Act of 1984, 42 U.S.C. § 423, which allows claimants to receive interim benefits pending an appeal. 42 U.S.C. § 423(g). Since then three circuits have held that interim benefits are past-due benefits. See Gowen v. Bowen, 855 F.2d 613 (8th Cir.1988); Shoemaker v. Bowen, 853 F.2d 858 (11th Cir.1988); Condon v. Bowen, 853 F.2d 66 (2d Cir.1988); contra Rodriguez, 856 F.2d at 341. 5 In Rodriguez, the court deferred to the Secretary, as Congress had authorized the Secretary to regulate attorney's fees. Id. at 341. This finding of explicit delegation was based on the Secretary's authority to prescribe the maximum fees. Id. (quoting 42 U.S.C. § 406(a)(1)). In full, this quotation states that the Secretary may, by rule and regulation, prescribe the maximum fees which may be charged for services performed in connection with any claim before the Secretary under this subchapter. 42 U.S.C. § 406(a)(1) (emphasis added). Instead of holding that the explicit delegation relates only to services performed before the Secretary, the court stated: [W]e think it inappropriate to defer to the Secretary's regulation under section 406(a) ... and to hold it unreasonable under section 406(b). Rodriguez, 856 F.2d at 341. 6 The majority position, holding that common sense and legislative intent dictate that interim benefits be included as past-due benefits, is justified on several bases. First, interim benefits are similar to a loan, since they must be repaid by unsuccessful claimants (absent waiver by the Secretary). Condon, 853 F.2d at 70. Thus, a claimant is not entitled to the benefits, absent a final favorable decision. Id. Second, the Secretary's definition of past-due benefits would: (1) create an unjustifiable dichotomy between attorneys of claimants who did and did not elect interim benefits; (2) create a potential conflict between attorneys and claimants; and (3) impose greater hardships on claimants by discouraging competent attorneys from representing them. Id. at 71. 7 Congress later amended Section 406(a) through the Omnibus Reconciliation Act of 1990 to exclude interim benefits from past-due benefits for calculating attorney's fees for services performed before the Secretary. 42 U.S.C. § 406(a)(2)(B). Nonetheless, there are two valid reasons to adopt the majority position. First, while Congress was aware of the Gowen, Shoemaker, and Condon holdings when it amended Section 406(a), it was silent about whether interim benefits should be excluded from past-due benefits for calculating attorney's fees for services performed before the courts. Second, as Congress delegated the Secretary authority with respect to Section 406(a) but not Section 406(b), the amendment merely affirmed the Secretary's definition of past-due benefits for calculating attorney's fees for services performed before the Secretary. Thus, we cannot infer any congressional intent to exclude interim benefits from past-due benefits for calculating attorney's fees for services performed before the courts from the amendment.