Legal Document

494 U.S. 83 110 S.Ct. 960 108 L.Ed.2d 72 Louis W. SULLIVAN, Secretary of Health and Human Services, et al., Petitioners,v.Sandra EVERHART al. No. 88-1323. Argued Nov. 27, 1989. Decided Feb. 21, 1990. Syllabus The Social Security Act requires the when he "finds that more or less than correct amount" "payment" has been made under Old-Age, Survivors Disability Insurance program, "benefits" paid Supplemental Income to make "proper adjustment recovery." If amount paid, shall pay balance due; if reduce future payment obtain a refund from beneficiary. prohibits, however, "adjustment payments to, recovery . from, any person who is without fault," such would defeat Act's purposes be against equity good conscience. Califano v. Yamasaki, 442 682, 697, 99 2545, 2555, 61 176, interpreted limitation as entitling beneficiary an oral hearing on waiver recoupment. Pursuant his authority "fin[d] [whether] made, general rulemaking authority, promulgated "netting" regulations. Under these regulations, calculates difference between due for period beginning with first month which there was error ending "initial determination." overpaid in certain months underpaid others, will net errors (i.e., calculate underpayments overpayments) treat netted overpayment underpayment, case may be, recovery. In this case, after both overpayments each respondent, errors, underpayments, offered recoupment hearings overpayments. District Court granted summary judgment respondents their ensuing lawsuit, ruling regulations violated Act. Appeals affirmed. Held: netting are facially valid. Pp. 88-95. (a) based permissible construction authorizes determine whether "more paid; "correct can reasonably construed mean owing date determination, rather month. refers "of payment," not "any payment" (as it does elsewhere), suggests computation multipayment basis. Nor restriction recovery" foreclose These terms do necessarily embrace all collection methods. "adjustment" reduction payments, "recovery" refund. 89-93. (b) method computing arbitrary capricious. inevitable delay discovery something amiss formal determination" (which closes period) necessary avoid spur-of-the-moment decisions. Secretary's limit delay, hypothesis deliberately net-in additional implausible. Respondents' alternative regime separate accounting increase administrative burden, suggestion delayed reimbursement address alleged problem. 93-95. 853 F.2d 1532, (CA10 1988) reversed remanded. SCALIA, J., delivered opinion Court, REHNQUIST, C.J., WHITE, BLACKMUN, O'CONNOR, JJ., joined. STEVENS, filed dissenting opinion, BRENNAN, MARSHALL, KENNEDY, joined, post, p. 96. Amy L. Wax, Silver Spring, Md., petitioners, pro hac vice, by special leave Court. Linda J. Olson, Denver, Colo., respondents. Justice SCALIA 1 Services determines received him effect recovery," subject restrictions This us decide so-called past overpayments, merely determining instead, netted-out must comply procedures imposed 2 * Two statutory benefit programs established (Act) involved: Survivors, program (OASDI), 53 Stat. 1362, amended, 42 U.S.C. § 401 seq. (1982 ed. Supp. V), (SSI), 86 1465, 1381 V). Millions Americans receive benefits programs; inevitably, some beneficiaries occasionally entitlement, others less. OASDI provides following procedure correcting errors: 3 "Whenever finds subchapter, proper prescribed Secretary, follows: 4 "(A) With respect amount, decrease subchapter entitled, require estate excess payable other basis wages self-employment income were person, apply combination foregoing. 5 "(B) person. ." §§ 204(a)(1)(A), (B); 404(a)(1)(A), (B) ed., As provides: 6 "In no United States fault purpose conscience." 204(b); 404(b) ed.). 7 provisions regulating SSI substantially similar.* 176 (1979), held 204(b) gives recipients right at they attempt convince waive 8 set forth above, contemplates made. Elsewhere, confers upon "make rules establish procedures, inconsistent appropriate carry out provisions," 205(a), 405(a) ed.); see also 1631(d)(1), 1383(d)(1) V) (SSI). issue here. regulation 9 "The underpayment recipient actually given period. An begins ends initial determination made." 20 CFR 416.538 (1989). 10 unhelpfully "[t]he entitled," 404.504 (1989), but embodying methodology regulation. Dept. Ruling 81-19a (cum. 1981). 11 hypotheticals illustrate operation Mr. A, entitled $100 per month, erroneously $80 January $150 February. March, incorrect, nets overpayment), seeks recover $30. Mrs. B, receives $50 April $110 May. June, makes incorrect pays $40. neither seek have treated separately: A could demand $20 February, B $10 12 present respondents, those pursuant He determined three (the original plaintiffs) amount. (intervenors below) them should waived overpayment. plaintiffs (later joined intervenors) suit 205(g) 1631(c)(3) Act, 405(g), 1383(c)(3) ed.), Colorado. They claimed invalid because (1) contrary (2) beneficiaries' rights procedural process. respondents' motion former ground, Tenth Circuit affirmed relevant respects. Everhart Bowen, 1532 (1988). court noted two Courts had upheld similar attacks. Id., 1536-1537 (citing Lugo Schweicker, 776 1143 (CA3 1985), Webb 851 190 (CA8 1988)). 13 We certiorari. 490 1080, 109 2098, 104 660 II 14 Our mode reviewing challenges agency's interpretation its governing statute well established: ask "whether Congress directly spoken precise question issue. intent clear, end matter; court, agency, give unambiguously expressed Congress." Chevron U.S.A. Inc. Natural Resources Defense Council, Inc., 467 837, 842-843, 2778, 2781, 81 694 (1984). ascertaining plain meaning statute, look particular language issue, design whole." K mart Corp. Cartier, 486 281, 291, 1811, 1817, 100 313 (1988); Mead Tilley, 714, 722-723, 2156, 2162, 796 But "if silent ambiguous specific answer statute," Chevron, supra, 843, S.Ct., is, "rational consistent NLRB Food Commercial Workers, 484 112, 123, 413, 420, 98 429 (1987). principles fully administration See Schweiker Gray Panthers, 453 34, 43, 101 2633, 2639, 69 460 (1981); Batterton Francis, 432 416, 425, 97 2399, 2405, 448 (1977). A. 15 consider speaks validity relevant: authorization limitation. First, paid. 404(a)(1), 1383(b)(1)(A) define term amount." It assuredly refer properly only possible interpretation, prevail, since ascertain longer time expansive amount," viz., determination. Although elsewhere describes monthly programs, e.g., 202(a), 402(a) V); 1611(c)(1), 1382(c)(1) nowhere specifies correctness month-by-month 16 fuller context Congress, authorizing did prohibit making "the made," 404(a)(1) mandates adjustments "[w]ith 404(a)(1)(B). mind shortfalls excesses individual overall balance, natural "with [or more] terminology used whenever ("the entitled"; "shall estate"). 404(a)(1)(A) (emphases added). Moreover, provision deceased seems contemplate ("[T]he ") Ibid. (emphasis 17 slightly different, way contradict position. authorize paid," Had read " might support position, written least bears (if indeed favor) single 18 Respondents nevertheless maintain, Appeals, another precludes point 204(b), 1631(b)(1)(B), 1383(b)(1)(B) argue using phrase intended requirement methods, including setoff effected netting. claim broad words (e.g., 404.502-404.503 (1989)), common usage Webster's Third New International Dictionary 1898 (1981) (hereinafter Webster's)), legal Burchard, 125 832, 31 L.Ed. 662 (1888)). agency between, nets, A's overpayment, 87-88, engaged complying imposes. 19 our view, discussed earlier, most bear desire—not cannot adopted Secretary. "Adjustment" limited favors) "an decrease" (Webster's 27), "get[ting] back" already (see id., ("recover")). meaning. reasonable, necessary, pari materia identical 204(a)(1). latter section directs follows." "decrease SSI, eligible spouse. Giving produce absurd policy consequences. Reducing benefits, requiring over cash, ordinarily hardship setting off unreasonable think former. therefore, decreasing obtaining calculation Only take step rectifying (increasing payments) (obtaining beneficiary). And governed say statute; one. 21 Since permitted, one remains: contend manner provide conducted capricious, definition Overpayments up "month [of] error. "Initial art committed. 404.902, 416.1402 Needless say, simultaneous amiss; inevitable. fatal. At best, turn fortuity worst, manipulate delaying thus reducing recoupment-waiver procedures. 22 capricious grace within determinations considered formally made; That extend period, result inclusion netted. we alternatives—immediate determinations, fixed period—would worse whole. 23 although principal adverse consequence delay: netting-in underpayments. provide: 24 "Where apparent detected 416.558(a)), otherwise unless before close discovered." 25 Program Operations Manual System, GN 02201.002 (1989) (Social Administration resolve quickly possible). fear intentional manipulation entirely dismissed observed faith—as presume, facial challenge, be. See, FCC Schreiber, 381 279, 296, 85 1459, 1470, 383 (1965). event Deliberately protracting draw underpayments; just likely uncollectible until conceivably ensure works Government's financial advantage underpaying while keeping open, obvious violation again stuff challenge constructed. 26 addition fact disadvantages approach assert, more. points cause great expense, cost greatlyin creased volume complex proceedings, simply proceedings exceed recovery, whose return lengthy delays. expenses "in come pockets deserving resources available social welfare unlimited." Mathews Eldridge, 424 319, 348, 96 893, 909, 47 (1976). 27 minimize burden proposing scheme notify withhold brief during then portion sought. scheme, problem asserted finding Substituting "notification" "determination" occasion name. What proposal really puts forward means assuring "netted out" opportunity hearing. length assurance. sum, find holding 28 29 reach contention violate process, instance. Sperry Corp., 493 52, 66, 387, 397, 107 290 Accordingly, reversed, remanded further opinion. 30 so ordered. whom KENNEDY join, dissenting. kingly power rewrite history delegated Services. Nevertheless, now claims concededly deficient payment. majority accepts argument. Because I believe sense respectfully dissent. 32 (Act), establishes (OASDI) By enacting legislation, authorized literally millions elderly needy beneficiaries. Anticipating inevitably many occasions directed prescribe outlining remedying 33 vast cases, uncontroverted. deal today narrow category disputed cases claimants assert designed protect specially disadvantaged Respondents, like wish compel ed.) (§ Act) 1383(b)(1)(B)(i) 1631(b)(1)(B)(i) (requiring circumstances). protests allowing waivers "great expense" "greatly increased proceedings." Ante, 94. fears are, course, irrelevant commands honor requests. Yamasaki 1977 average exceeded $500, 3.4 percent persons requested U.S., 686, n. 2, 2550, 2. Thus, applies matter decision practical about 3.5 Even encompasses implicated complaint, however. controversy affects attempts recoup together waiver. address, short, subset minority waivers.1 34 beneficiaries, involving explicit mandatory instructions. Those instructions recognize made" involves factual ignored. erase historical record pretend never occurred later events alter significance earlier ones. 35 what command says overpayments:2 36 Act; 37 previously recognized "concerning overpayment" imperative voice" 'there person' qualifies waiver." 693-694, 2553-2554. 38 observed, counterpart "statute clear differentiation" 1537 "While relating mandate qualification, qualified procedures." reason distinction easily surmised. unknowingly spend it, realizing Government back money needed refusing compensate prior underpayment. left essential bills. Judge Gibbons "difference treatment quite fundamental motivating Titles; namely need society necessities life." Schweiker, 1143, 1154 1985) (dissenting opinion). here, "treat equally," Everhart, F.2d, 1537, thereby deviating letter command. 39 use typical $500 examples, readily how "netting regulations" example, assume 1978 discovered 1988. conscience 1988, follows second hypothetical same facts 1988 beneficiary's checks reduced $250 months. reading request denied ground nor 40 my view intolerable. assumption 1988—whether negligent deliberate—could extinguish years flatly "equity conscience" For paid—when series pair 1988—is nothing short rewriting destroy citizen's valuable right. 41 light statistics quoted expect refusal requests injure cases. illustrative propounded majority, suppose quick succession 2-month ante, elect Yet, foresaw, entail much serious difficulties cover discrepancies, examples invented multi-year periods, done actual case. form rough justice ratio excuses injustice true few comparison total handled crucial importance stake substantial, reasons why commanded carefully equities overwhelmingly apparent. respondent Emil Zwiezen wife dependent $911. According $9,483 1981. failed increases and, 1984, accumulated $4,376. ultimately remaining subtracted entire him. affidavit, resulting shortfall caused couple suffer severe emotional water bills, fallen behind house feared doctor druggist stop providing medical care. Affidavit Zwiezen, reproduced Brief Appellee 87-1839 (CA10), 31A. F.Supp. 1518, 1519-1520 (Colo.1988). 43 enabled $4,376 giving notice required depends highly unnatural provisions. assumes occur occurred. foreclosed 1631(b)(1)(B)(i),3 perversely converts duty into change them. 44 Second, prohibitions inequitable either deliberate inadvertent simple mistake effort await recognizing expressly prohibits.4 "[n]o setoff, suit; all." (Gibbons, dissenting). permit accomplish plainly unequivocally forbid; 1155 (footnote omitted). chameleons. 45 Finally, replete references benefits,5 word 204(a), 1631(b)(1)(B)(i), 1631(b)(1)(A), aggregate numerous several years. Indeed, period—instead made—is eyes accordion-like concept expanded encompass ongoing. key completely artificial underpayments." Lugo, 46 distortions congressional intent. contends defer statute. Relying heavily (1984), responsibility construe statutes administers away participant both. suggestion. progeny yield privilege. "judiciary final issues reject constructions intent," administrator's "employing traditional tools construction." 9, 9. accordingly hesitated "agency interpretations fall extent conflict language." Public Employees Retirement System Ohio Betts, 492 158, 171, 2854, 2863, 106 134 Dole Steelworkers, 26, 929, (1990); INS Cardoza-Fonseca, 480 421, 445-450, 1207, 1220-1222, 94 434 itself rejected state express decision, found held. analyzed concluded nature standards essential." 693, 2553. import believe, equally clear.6 48 refuses heed direction standards. doing, conclusion that, wished netting, "it natural" payment." 90. Perhaps so.7 clearly diminishes rights, nonetheless drafting here character provision,8 statute's reference conscience," thought unnecessary add specifically program. event, majority's argument irrelevant.9 Just sit supply directives where gave none, likewise insist precisely possible. intended, assay stated naturally, artfully, pithily. 49 beyond peradventure citizens full checks, even sometimes forgoing strain purpose. ignored entirely, student justify "payment," facts. "reasonably bears," 93, inconceivable wise judges conclude delegates himself "based statute." 2781. 50 Whenever individual, shall, succeeding subsection, spouse (or either) (i) avoiding penalizing connection account conscience, (because small involved) impede efficient effective subchapter. 1383(b)(1)(A), becomes especially weak very large. evade effectively nullify Such strong evidence Colautti Franklin, 439 379, 392, 675, 684, 58 596 (1979) (it "elementary canon render part inoperative"). Section reads: subchapter." adjustment. Notably, Likewise, .," benefits." speculates "[d]eliberately proposition depends, relative frequency equal frequency, offers support. One opposite assumption: errs own favor often, substantially, 402(a), 402(j) predates interpretive maxims summarized therein "well-settled principles." 845, 2783. far clear. referred transfer, in, reads part, stated, ambiguous. were, dispell trouble majority. embraces concepts: wealth transaction transfer. reason, lender tell borrower "a debt." plural focuses attention transactions, transfer accomplished transactions together. And, indeed, careful examination dissent show frequently distinguish invoking plural, "payments." wisely declines suggest option reasons. imagining redraft defective payment, multiple payments. payments," readers believed referring, albeit awkwardly, number transaction. assuming comprehensive together, subsidiary question: abnormality interest. dealing, improper noted, proposes solve inserting "any" "payment." adjective begs question. "Any differ distinguishing transfers, transfers paradigmatic group transfers. arguably subsection applicable words, introductory clause redrafted version include twice—"In ."—but continue face "anys" rule exceptions explaining applied transactions: revised but, phrase, proposed bears" interpretation. 93. apparently confronted expression imagines search uses awkward educated layman cringe legalism; paid" crisply. Why bulky payment"? hoped focus payments: reminds reader "amounts" total, regular installments—denominated obviously dispositive, plausible discussion Of obviated analysis months, saying: overpayments." My impossible, however; posed ascribed conscious delegation, absence intent, inability forge coalition. 865, 2792. Rather, problems pending imprecision inherent sort political language. Federalist 37, 230 (E. Earle 1937) (James Madison concepts). 693-695, confer right, though "hearing." draft mentioned expressly. supplied objection: natural, unnecessary, inheres standards."

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