Court Opinion

ID: 9471150
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:25:54.957309+00
Date Added: 2024-06-11T17:42:17.343916
License: Public Domain

PELL, Circuit Judge,
concurring in part and dissenting in part.
During the course of what I regard as a thoroughly well-reasoned Decision and Order of District Judge Evans he observed that while he might without considerable difficulty determine that in theory that a pretermination hearing was appropriate, when he looked to the government’s interest, applying the requirement for pre-termination hearings to be the complicated bureaucratic Rent Assistance Program, and viewed the existing procedures, he wondered why this case was filed. I express the same wonder as to why on the facts of the Simmons case it is being reversed for further proceedings. While I concur in the result reached as to Williams, I respectfully dissent from the Simmons portion of the majority decision and would adopt the Decision and Order of the district court as the opinion of this Court.
Because the district court’s Decision and Opinion was not published, I set forth as a part of my dissent, extracts from that Decision and Order:
Plaintiffs have rights to due process of law in the termination of their Section 8 benefits if certain requirements are met. First, there must be governmental action sufficient to invoke the guarantees of the Fifth Amendment. Jackson v. Metropolitan Edison Co., 419 U.S. 345 [95 S.Ct. 449, 42 L.Ed.2d 477] (1974). The Housing Authority of the City of Milwaukee is a government entity and defendant Drew is acting under his authority as its Executive Director and Secretary. As far as is relevant to this case, both the Housing Authority and its Director are acting through a relationship with the U.S. Department of *1165Housing and Urban Development. Governmental action is clear.
Secondly, in order to establish a right to due process, plaintiffs must establish that they have a liberty interest or a property interest to which there is a claim of entitlement. Morrissey v. Brewer, 408 U.S. 471 [92 S.Ct. 2593, 33 L.Ed.2d 484] (1972). In order to have a protected property interest, plaintiffs must show that they have more than a “unilateral expectation” of the benefit. Board of Regents v. Roth, 408 U.S. 564, 577 [92 S.Ct. 2701, 2709, 33 L.Ed.2d 548] (1972). It seems fairly well established that a participant in a Section 8 Program has a legitimate claim of entitlement to benefits. Holbrook v. Pitt, 643 F.2d 1261 (7th Cir. 1981); Singleton v. Drew, 485 F.Supp. 1020 (E.D.Wis.1980).
Thus the question becomes, what process is due. The question involves both the timing of the due process hearing (prior to or after benefits are terminated), and the range of due process tools which must be involved (e.g., cross-examination, subpoenaing of witnesses, etc.).
Determining whether a hearing must precede or follow government action is for courts often an excursion into a theoretical realm and the answer involves an abstract determination of whether an interest protected is more like the right to welfare benefits, as in Goldberg v. Kelly, 397 U.S. 254 [90 S.Ct. 1011, 25 L.Ed.2d 287] (1970), or like Social Security benefits, as in Mathews v. Eldridge, 424 U.S. 319 [96 S.Ct. 893, 47 L.Ed.2d 18] (1976). Mathews sets forth the factors to be considered:
“First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.” At 335 [96 S.Ct. at 903],
Using these factors, several courts have determined that terminations from various housing programs require pre-termination hearings. See: Ferguson v. Metro. Development and Housing Agency, 485 F.Supp. 517 (M.D.Tenn.1980); Escalera v. New York City Housing Authority, 425 F.2d 853 (2d Cir.1970); cert. den., 400 U.S. 853 [91 S.Ct. 54, 27 L.Ed.2d 91]; Caulder v. Durham Housing Authority, 433 F.2d 998 (4th Cir. 1970); cert. den., 401 U.S. 1003 [91 S.Ct. 1228, 28 L.Ed.2d 539] (1971). Recently, in a Section 8 case involving the retroactivity of payments, the Court of Appeals for this circuit has stated: “... Appellants must receive some sort of hearing before retroactive benefits are finally denied ..., since the ‘fundamental requirement of due process is the opportunity to be heard at a meaningful time and in a meaningful manner.’ ” Holbrook, supra, at 1281.
Under the Mathews criteria, the private interest in this case as well as the risk of an erroneous deprivation might lead me to conclude, without considerable difficulty, that in theory a pre-termination hearing is appropriate. However, when I look to the government interest, apply the requirement for pre-termination hearings to the complicated bureaucratic Rent Assistance Program and view the existing procedures, I wonder why this case was filed. In some situations, using “termination” to mean what the parties to this lawsuit assume it means, it is impossible to hold pretermination hearings. It would be unfair to the program to glibly declare that pre-termination hearings are always required because, as defendants correctly point out, in some situations there is simply no landlord under contract with the program to whom payments can be made.
A variety of occurrences can result in termination from the program. Some, such as failure to keep appointments with program officials or damage to a unit which does not result in eviction have no effect on the lease between a landlord and the tenant and therefore have no effect on the place of residence of the tenant. Other offenses, most notably, moving out prior to the expiration of the lease, mean of course a change *1166in residence. Given the definition of “termination” used by both sides to this lawsuit, whether or not a change in residence is involved is significant to whether a hearing can be pre- or post-“termination.”
Because of the structure of the program, payments cannot be made unless there is an existing contract with the landlord whose rental unit has been approved. Therefore, when a situation arises which involves, for whatever reason, a tenant vacating an approved unit prior to moving into another approved unit, benefits must necessarily be interrupted. If the abandonment of a unit occurs without notice or with inadequate notice to the program, benefits will be interrupted without a prior hearing. Nothing anyone can demand of the program can change that fact.
However, it seems to me that in reality the way the program is now run an interruption of benefits is not a “termination” of eligibility in the program. An abandonment of a unit necessarily gives rise to an interruption of benefits and the possibility of termination from the program entirely, that is, a loss of eligibility. However, before a person loses eligibility for the program, a hearing is held. For me to order the program to use different words in describing its procedures would be nothing more than ordering a change for cosmetic purposes.
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Plaintiff Hosea Simmons lost benefits more because of bureaucratic hardheadedness than lack of procedural protections. And to the credit of the program, following a hearing she was reinstated in the program. Simmons had a lease and a contract for March 1, 1979 through February 29, 1980. On December 14,1979, she was certified for another year of eligibility. On February 11,1979, Simmons requested lease approval for a new rental unit. Approval was granted February 14,1980. On February 20, the program was informed that Simmons had vacated and damaged her first unit. After inspecting the unit, on March 4,1980, the program sent Simmons a notice that she was being terminated because she vacated her unit prior to the expiration of her lease. A hearing was held on April 1, 1980, and on April 9, 1980, she was notified that her participation in the program could continue, but on April 17 she was notified that she had to satisfy the damage claim from the first unit before benefits would begin. She did so on May 5, and effective May 8, 1980, a lease and contract were entered into for her second unit.
Simmons’ hearing revealed a remarkable attitude on the part of the program officials. Her attorney attempted to determine why moving out 13 days in advance of the end of the lease period was per se a violation. (No claim of non-payment of rent was made.) The answer was, “Well, basically the program feels that the tenant would be required to live up in there til the last day of the lease period.” (Affidavit of Ann Marie Steffen Oldenburg, Ex. 10, p. 3.) Later in the hearing Simmons’ lawyer asked:
“So you’re telling me that the program policy is that the tenant, a tenant in Rent Assistance, is expected to move out on the last day of the one year lease period.
A. Correct ... that’s generally what most of them will do.”
As an explanation of why she moved early, Simmons asserted that she had found a unit which might not be available if she waited until March 1 to rent it. Further, she stated, without contradiction, that her moving costs in the middle of the month were less than they would be at the end. Apparently the absurdity of the program’s position became clear to the decisionmaker and Simmons was “continued” in the program.
Simmons was improperly “terminated." However, through the procedural machinery already in place, she was reinstated. Nothing I can order can prevent some bad calls. And I am convinced that to order meaningless changes would put an unjustified burden on the program that would not result in a benefit to the recipients. In fact, the more hurdles the program has to *1167jump to be administered, the less money is left to distribute in benefits.
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Plaintiffs also argue that the notice and hearing provided are deficient. The issue is what process is due. The answer, I believe, is not very much. The plaintiffs are trying to take too large a bite out of the apple by arguing that certain procedures, many of which are akin to a criminal prosecution, are required here. Instead, the following procedures seem appropriate. A notice must be sent setting forth the violation which has allegedly occurred. It must state that a hearing may be requested. The procedure to be followed in obtaining the hearing must be explained and the notice should state that counsel is allowed, though not required, at the hearing.
The hearing itself must meet certain requirements. The recipient must be allowed to present evidence and offer information. Although the decisionmaker must be fair, prior contact or involvement in the initial decision to terminate is not a ground for disqualification. The decision rendered must be based on the material presented at the hearing (although no rules of evidence apply) and must be issued soon after the hearing. It need not be a formal decision with findings of fact or conclusions of law; however, it should inform the recipient of the reasons for the decision. What the agency presently does is close enough to what I am suggesting here, therefore no order on the point will be issued.
I am particularly troubled by the fact that Simmons apparently candidly admitted at her hearing that she had moved before the expiration of the term of the lease; that she had found a unit which might not be available if she waited until March 1 to rent it; and that moving costs in the middle of the month were less than they would be at the end. If she had had a pre-termination hearing I think it would be safe to assume that she would have admitted that she moved and thereby she would have conceded being in violation of one of the specific provisions of the Program Manual. The result on remand appears to be foreordained and to be requiring a fruitless exercise in an already overburdened court system. Due process is extremely important in American jurisprudence and I would not express an opinion which would in any way diminish our adherence to it. I simply think that in the Simmons situation, due process being in essence fairness of procedure, Simmons was not denied all of the process due her.