Court Opinion

ID: 7921183
Source: CourtListenerOpinion
Date Created: 2022-09-08 22:22:58.699432+00
Date Added: 2024-06-11T16:33:04.120224
License: Public Domain

ADKINS, J.,
dissenting, which BELL, C.J., (ret.) joins.
I disagree with the Majority’s analysis of the jurisdictional issue. Ryan’s claims against the Department arise from an alleged breach of fiduciary duty. The Majority concludes, however, that the appropriate forums for the resolution of such claims are “federal administrative and court systems.” Maj. Op. at 600, 76 A.3d at 1062. This may have been a proper conclusion had Ryan sought restitution of the allegedly misused benefits from the Social Security Administration (the “SSA”) by relying on the provisions in the Social Security Act (the “Act”) and the underlying regulations. But Ryan is not seeking restitution from the SSA. He sought to recover the allegedly misused funds by way of a common-law claim. As a court with supervisory authority over “support” of Ryan, a Child in Need of Assistance (“CINA”), the juvenile court had jurisdiction to hear Ryan’s case.
As the Majority acknowledges, “[w]hen Congress is silent concerning [concurrent] state court jurisdiction over federal *614causes of action, there is a ‘deeply rooted presumption in favor of concurrent state court jurisdiction.’ ” Majority Op. at 595, 76 A.3d at 1059 (quoting R.A. Ponte Architects, Ltd. v. Investors’ Alert, Inc., 382 Md. 689, 715, 857 A.2d 1, 16 (2004), in turn quoting Tafflin v. Levitt, 493 U.S. 455, 459, 110 S.Ct. 792, 795, 107 L.Ed.2d 887 (1990)). This presumption can only “be rebutted by an explicit statutory directive, by unmistakable implication from legislative history, or by a clear incompatibility between state-court jurisdiction and federal interests.” Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 478, 101 S.Ct. 2870, 2875, 69 L.Ed.2d 784 (1981).
I submit that none of the three abovementioned rebuttals to the presumption of concurrent state jurisdiction are present in this case.
In holding that federal courts enjoy exclusive jurisdiction, the Majority does not take into account the crucial fact that Ryan’s claims are against the Department, not the SSA. Rather, the Majority treats the jurisdictional issue in this case as if the question were as to which court had jurisdiction to review the SSA’s determination regarding an alleged misuse of the benefits by a representative payee. In answering this hypothetical question, instead of the one presented in this case, the Majority offers several possible reasons for concluding as it does without picking a favorite.
One such possibility the Majority considers is that the Social Security Act itself reserves exclusive jurisdiction to federal courts. See Maj. Op. at 596, 76 A.3d at 1060 (citing the “shall be brought in the district court” language from 42 U.S.C. § 405(g)). According to the Majority, “Congress’s use of the word ‘shall’ suggests strongly that the jurisdiction of the federal courts is exclusive.” Maj. Op. at 596, 76 A.3d at 1060 (emphasis added).1 Yet the Majority cites no case holding *615that federal courts have exclusive jurisdiction over a claim, not against the SSA, but against a representative payee, and 1 have found none. The only claim that is authorized by the SSA for misuse of funds by a representative payee is a claim by a beneficiary against the SSA for recovery of those benefits. I submit that the term “shall” in the Act refers to filing a claim for judicial review of a decision made by the Commissioner of the SSA regarding such a claim.
A number of other states have found state court jurisdiction even with similar “shall” language in place. See Ecolono v. Div. of Reimbursements of Dep’t of Health and Mental Hygiene, 137 Md.App. 639, 769 A.2d 296 (2001); Grace Thru Faith v. Caldwell, 944 S.W.2d 607 (Tenn.Ct.App.1996); Jahnke v. Jahnke, 526 N.W.2d 159 (Iowa 1994); In re J.G., 186 N.C.App. 496, 652 S.E.2d 266 (2007). The Majority distinguishes those cases only by pointing out that they were decided prior to the 2004 amendments to the Act:
Because the 2004 amendments to the Social Security Act enhanced the monitoring of institutional representative payees and made available federal remedies for misuse of benefits, the rationale underlying the result in Ecolono and cases from other jurisdictions ... no longer exists.
Maj. Op. at 600, 76 A.3d at 1062.
But the lack of a Federal remedy was not the only, or even the primary, basis for these cases. For example, in Matter of Kummer, the New York appellate court was clear:
*616[I]t is our view that whether or not a Federal cause of action exists is irrelevant. The implication of a Federal cause of action for breaches of Federal statutes is of importance in many cases only because it furnishes the jurisdictional predicate for access to the Federal courts ... and not, as the administratrix would have it, because absent such an implied Federal right of action an injured party is without a remedy for wrongs committed against him.
Matter of Kummer, 93 A.D.2d 135, 160-61, 461 N.Y.S.2d 845, 861 (N.Y.App.Div.1983) (emphasis added).
The Rummer court distinguished cases involving the SSA’s actions or decisions:
The four cases cited by the administratrix dealt with eligibility, the amount of benefits, whether Federal officials had appointed an improper representative payee, and who should control the funds as representative payee. Our case deals with the representative payee’s account, that is with the propriety of his expenditures of benefits.
Matter of Kummer, 93 A.D.2d at 156, 461 N.Y.S.2d at 858 (N.Y.App.Div.1983).
The Tennessee Court of Appeals also rejected an argument similar to the Department’s here, concluding:
Therefore, the federal statutes and regulations allow for claims beyond those expressly provided for therein and contain no language indicating an intent to preempt state court jurisdiction. Moreover, a state claim by a beneficiary for recovery of funds misused by a payee does not conflict with the federal statutes and regulations.
Grace Thru Faith, 944 S.W.2d at 611 (Tenn.Ct.App.1996).
Our own intermediate appellate court concluded that the state had jurisdiction over a similar claim, reasoning:
Regardless of the extent of the duty of the SSA to monitor the expenditure of benefits by representative payees, we find nothing in federal law to indicate an intent by Congress to limit interested parties to the federal administrative and judicial review process and to prohibit *617State courts from exercising jurisdiction, in the case before us, when the relief requested is not the removal of the payee but a reallocation of the benefits. Consequently, we conclude that we have subject matter jurisdiction to decide a dispute between the beneficiary of social security benefits and his representative payee with respect to the allocation of those benefits.
Ecolono, 137 Md.App. at 654, 769 A.2d at 305 (2001).
Before the 2004 amendments, the SSA reimbursed beneficiaries whose benefits had been misused by their representative payees only if the SSA was negligent in appointing or monitoring the representative payee. The 2004 amendments to the Act expanded the remedy to beneficiaries in cases where the representative payee was not an individual, unless that individual serves 15 or more beneficiaries. 42 U.S.C. § 405(j)(5). In those types of misuse cases, the SSA will make restitution to the beneficiary even in the absence of the SSA’s negligence. Id. Neither before nor after the 2004 amendments, however, did the representative payee provisions of 42 U.S.C. §§ 405 and 1383 give a private cause of action to a beneficiary against the representative payee. See Bates v. Northwestern Human Servs., Inc., 466 F.Supp.2d 69, 98 (D.D.C.2006) (denying a claim under the Act because “it is clear that nothing in these statutes expressly states that a beneficiary may file a lawsuit against a representative payee who has misused his or her benefits payments or otherwise violated the terms of the representative payee provisions”).
Notably, although denying Bates’ federal claim under the Social Security Act, the Federal District Court for the District of Columbia ruled in favor of Bates’ common-law claims for accounting and unjust enrichment against the representative payee. Id. at 102-03 (“The plaintiffs allege, and the defendants do not dispute, that (1) the defendants served as the plaintiffs’ representative payees under the Social Security Act; (2) in that capacity, the defendants received federal benefits intended for the plaintiffs; and (3) the defendants owed a fiduciary duty to the plaintiffs as a result of their representative payee status.... These allegations are more than suffi*618cient to sustain a claim of unjust enrichment at the pleading stage”).
The Majority holds that federal courts have exclusive jurisdiction over claims such as Ryan’s. Applying the reasoning of Bates, I strongly disagree. The Social Security Act does not afford beneficiaries a private right of action against representative payees. This is the nature of Ryan’s action — it is an attempt to recover allegedly misused benefits directly from the Department. Ryan’s “Motion for Order Controlling Conduct to Conserve Social Security Survivor’s Benefits” is akin to an unjust enrichment claim under state law, and the facts alleged suffice under the Bates standard for viable breach of fiduciary duty or unjust enrichment claims.
Nor does the Act suggest that state law remedies against the representative payee are precluded. All that 42 U.S.C. § 405 has ever allowed a beneficiary to do is to seek to have the SSA enforce the statutory provisions and assist with obtaining restitution of misused benefits from the SSA. This is where the need to exhaust the administrative remedies comes in. In order to have the SSA reimburse the representative payee’s misused benefits, the beneficiary must follow the administrative process.2 See Monet v. Mathews, 585 F.Supp.2d 132, 134 (D.D.C.2008) (outlining all of the prerequisite steps in the administrative review process). If, after having exhausted the administrative remedies, the beneficiary is dissatisfied with the outcome, he can then seek judicial review of the SSA’s determination in federal court. In that instance, the beneficiary’s claim is not against the representa*619tive payee. Rather, it is for the judicial review of the SSA’s determination, and any recovery will be from the SSA. See 42 U.S.C. § 405(g) (“Any individual, after any final decision of the Commissioner of Social Security ... may obtain a review of such decision by a civil action ... brought in the district court of the United States”); see also 42 U.S.C. § 405(c)(9). (“Decisions of the Commissioner of Social Security under this subsection shall be reviewable by commencing a civil action in the United States district court”).
The failure of the Act to allow beneficiaries to bring direct claims against representative payees in federal courts is the reason why the D.C. Federal District Court dismissed a claim in which beneficiaries tried to do just that. See Bates, 466 F.Supp.2d at 98. There, the Court dismissed certain counts against a representative payee alleging violations of 42 U.S.C. §§ 405 and 1383 and their implementing regulations because, as the court explained, “whether or not Congress intended to create a private right under the representative payee provisions of 42 U.S.C. §§ 405 and 1383, there is no indication of further congressional intent to fashion a privately enforceable remedy for such a right.” Bates, 466 F.Supp.2d at 97. Yet Bates, decided after the 2004 amendments to the Act, allowed a common-law claim to proceed. Id. at 102. Although the 2004 amendments to the SSA added a federal remedy against the Administration, it did not contain any language suggesting that a direct action against the representative payee in state court was prohibited. See Tafflin v. Levitt, 493 U.S. 455, 459, 110 S.Ct. 792, 795, 107 L.Ed.2d 887 (1990); see also Charles Dowd, Box Co., v. Courtney, 368 U.S. 502, 507-508, 82 S.Ct. 519, 522-523 (“We start with the premise that nothing in the concept of our federal system prevents state courts from enforcing rights created by federal law. Concurrent jurisdiction has been a common phenomenon in our judicial history, and exclusive federal court jurisdiction over cases arising under federal law has been the exception rather than the rule”). As the Supreme Court has explained, “[t]o rebut the presumption of concurrent jurisdiction, the question is not whether any intent at all may be divined from legislative *620silence on the issue, but whether Congress in its deliberations may be said to have affirmatively or unmistakably intended jurisdiction to be exclusively federal.” Tafflin, 493 U.S. at 462, 110 S.Ct. at 797.
In sum, Ryan’s claim against the Department is a common-law cause of action for unjust enrichment or breach of fiduciary duty that is not precluded by any provision of the Social Security Act.
Juvenile Court’s Supervisory Jurisdiction Over CINA Matters
The juvenile court is well suited to hear and adjudicate this matter. At the time Ryan became aware of the Department’s alleged misuse of his benefits, he was a Child in Need of Assistance. Then, and almost the entire time since he was found to be a CINA in 2002, Ryan had been in the custody of the Department. In accordance with Section 3-823 of the Courts and Judicial Proceedings Article of the Maryland Code (“CJP”), Ryan and the Department came before the juvenile court for regular CINA review hearings. The purpose of those hearings was for the juvenile court to ensure that the services the Department provided to Ryan were consistent with his best interests. See Md. Code (2002, 2013 Repl. Vol.) CJP § 3-819(g).
It was in that same juvenile court, which over the years presided over Ryan’s numerous review hearings, that Ryan filed the “Motion for Order Controlling [the Department’s] Conduct to Conserve Social Security Survivor’s Benefits.” He asked the juvenile court to order the Department to conserve in a trust account for Ryan’s future needs the $31,693.30 in Social Security Old Age, Survivor, and Disability Insurance benefits that it had received as Ryan’s representative payee from the SSA.
As Ryan and the amici correctly point out, the General Assembly has given Maryland’s juvenile courts broad supervisory powers to protect the best interests of children who were found CINA. See CJP § 3-802. Indeed, as we have explained:
*621In light of the [juvenile court] statute, and also in light of the language of some of the cases, it has become the practice to speak in terms of the juvenile court’s “jurisdiction.” The Constitution of Maryland, however, does not provide for a separate juvenile court. The Constitution provides that the courts of general jurisdiction are the circuit courts. Accordingly, a juvenile court, despite the statutory language, is part of the circuit court, and exercises the jurisdiction of that court.
In re Franklin P., 366 Md. 306, 311 n. 2, 783 A.2d 673, 677 n. 2 (2001) (emphasis in original).
There are also several statutory provisions that specifically address financial support of CINA children and the juvenile court’s supervision of local departments of social services. First, CJP § 3-803, titled “Jurisdiction of court,” expressly states that juvenile courts have “concurrent jurisdiction over: (i) Custody, visitation, support, and paternity of a child whom the court finds to be a CINA.” CJP § 3-803(b)(l)(I) (emphasis added); see also CJP § 3-819(e)(2) (stating that the court may “[determine custody, visitation, support, or paternity of a child”). This suggests that juvenile courts do indeed have the authority to resolve disputes involving financial support to CINA children.
Juvenile courts also have broad supervisory power over the local departments of social services, which sometimes, as in the present case, are entrusted with managing financial resources of a child found to be a CINA. Namely, CJP § 3-802(c) allows “the court [to] direct the local department to provide services to a child ... to protect and advance a child’s best interests.” Specifically with respect to a child’s property, CJP § 3-819(g) provides that a guardian, including the local department, “has no control over the property of the child unless the court expressly grants that authority.” Accordingly, juvenile courts have broad supervisory powers over the Department generally and its handling of a CINA child’s property.
*622Despite these statutory provisions, the Court of Special Appeals held that the juvenile court had no jurisdiction to hear Ryan’s claims.3 In re Ryan W., 207 Md.App. 698, 757, 56 A.3d 250, 285 (2012). The court reasoned that the “statutorily enumerated authority over ‘support’ of children declared CINA” does not include “the Department’s use of benefits it had received on his behalf as a duly appointed representative payee.” Id. In the court’s view, the term “support” only includes such obligations as “child support.” Id. The intermediate appellate court did not provide support or an explanation for this conclusion but moved on to summarily conclude that, even if “support” encompassed more than “child support,” “the Juvenile Court has [no] plenary equitable powers to order the Department to place monies already collected and disbursed in a trust for the benefit of the CINA.” Id.
But that is not so. Setting aside the statutory sources of the juvenile court’s specific authority to oversee the issues relating to financial support of children in CINA cases and to supervise the Department’s conduct in these cases, “[i]t is a fundamental common law concept that the jurisdiction of [juvenile] courts is plenary so as to afford whatever relief may be necessary to protect the [child’s] best interests.” Wentzel v. Montgomery Gen. Hosp., Inc., 293 Md. 685, 702, 447 A.2d 1244, 1253 (1982). The juvenile court, “acting under the State’s parens patriae authority, is in the unique position to marshal the applicable facts, assess the situation, and determine the correct means of fulfilling a child’s best interests.” In re Mark M., 365 Md. 687, 707, 782 A.2d 332, 343-44 (2001).
While Ryan bounced from one group home to the next, sometimes staying at places that allegedly lacked basic necessities but cost $6,000 a month, the Department used Ryan’s social security benefits to reimburse itself for the cost of this care. It is difficult to imagine any court — other than the juvenile court — more familiar with Ryan’s circumstances and *623thus in a better position to determine whether the Department’s use of the benefits in such a way was in Ryan’s best interest.
Conclusion
In conclusion, because the Social Security Act does not preclude a common-law action for unjust enrichment or breach of fiduciary duty against a representative payee, and the juvenile court is authorized to adjudicate matters related to protecting the bests interests of children designated CIÑA, I would allow Ryan’s action to go forward based on the allegations plead.
For these reasons, I most respectfully dissent.
Chief Judge BELL (ret.) authorizes me to state that he shares the views set forth in this dissenting opinion.

. That the phrase "shall be brought in the district court” necessarily carries a mandatory connotation is not a foregone conclusion. While there is no case interpreting the "shall” language in the Social Security Act, it has been interpreted in other contexts. For instance, many *615federal courts have held that, in the context of the "Resource Conservation and Recovery Act” ("RCRA”), the "shall be brought” language “unambiguously demonstrates that federal courts have exclusive jurisdiction over RCRA claims.” See, e.g., Litgo New Jersey Inc. v. Comm’r New Jersey Dep’t of Envtl. Protection, 725 F.3d 369 (3d Cir.2013). Yet, the United States Court of Appeals for the Sixth Circuit has held that the "shall be brought in the district court” language in RCRA "does not affirmatively divest the state courts of their presumptive jurisdiction.” Davis v. Sun Oil Co., 148 F.3d 606, 612 (6th Cir.1998); see also Yellow Freight System, Inc. v. Donnelly, 494 U.S. 820, 823, 110 S.Ct. 1566, 1569, 108 L.Ed.2d 834 (1990) (holding that the enforcement provisions of Title VII, which provide that federal courts "shall have jurisdiction,” do not “expressly confined jurisdiction to federal courts or oust[] state courts of their presumptive jurisdiction”).

. The Department contends that the beneficiary must always seek resolutions of issues pertaining to benefits — even after they have been paid and spent by a representative payee — through the SSA. This argument is unconvincing. The Social Security Act expressly refers to determinations of "a court of competent jurisdiction” with regard to misuse of payments: “If the Commissioner of Social Security or a court of competent jurisdiction determines that a representative payee has misused any individual's benefit paid to such representative payee the Commissioner of Social Security shall promptly revoke certification for payment of benefits to such representative payee....” 42 U.S.C. § 405(j)(l)(A).

. Yet, before holding that the juvenile court had no jurisdiction, the Court of Special Appeals had resolved the case on its merits, at least in part.