Court Opinion

ID: 9795314
Source: CourtListenerOpinion
Date Created: 2023-08-31 03:25:51.798089+00
Date Added: 2024-06-11T08:29:24.756994
License: Public Domain

SUTIN, Chief Judge (dissenting). {11} I respectfully dissent. The Sole Issues on Appeal {12} The only issues before the Human Services Department, the district court, and this Court have been and are whether the doctrine of equitable estoppel can be asserted as a defense to bar enforcement of a food stamp overissuance claim and, if so, whether the recipient established the defense. {13} Following a fair hearing and a recommended decision of an administrative law judge in favor of the Department, the Department determined that there was a food stamp overissuance and denied the application of the doctrine of equitable estoppel on the ground that “[fjederal law permits no exception for equitable estoppel in the case of a food stamp overissuance caused by administrative error.” The recipient, Ms. WatersHaskins, appealed to the district court. {14} In the district court, the recipient acknowledged that the Department had a right to establish the claim under the regulations and asserted that the essence of the case was whether the doctrine of equitable estoppel could be applied as a defense to the claim. The district court affirmed the Department’s decision on the claim, ruling that the Department properly established the claim. The court also ruled that equitable estoppel did not apply to a food stamp overissuance case. The court further stated that even if equitable estoppel could apply, it did not apply in the case at hand because the Department did not engage in a shocking degree of aggravated and overreaching conduct. {15} In this Court, the two points the recipient raises for reversal pertain solely to equitable estoppel: (1) the New Mexico doctrine of equitable estoppel is not precluded by federal food stamp overissuance law, and (2) the elements of equitable estoppel were met in this case. The recipient asks this Court to declare that the doctrine of equitable estoppel may be applied as a defense to a food stamp overissuance claim. Further, the recipient asks this Court to reverse the decisions of the Department and the district court and order the removal and dissolution of any overissuance claims made or that the Department anticipates making. The Majority Opinion Raises Solely New, Different Issues {16} The majority sets out portions of federal law and also sets out a federal agency interpretative statement. Majority Opinion, ¶¶ 5-6 (setting out portions of 7 U.S.C. § 2022(a)(1) (2002), 7 C.F.R. §§ 271.4(b) and 273.18(e)(7) (2008), and 65 Fed.Reg. 41,752, 41,765 (July 6, 2000)). The majority interprets these federal provisions to require the Department to exercise its discretion to compromise. Majority Opinion, ¶ 8. The majority also interprets these federal provisions to require the Department to exercise its discretion to consider waiver, based on yet another interpretation of federal law that the authority to compromise a claim includes the authority to waive a claim. Majority Opinion, ¶¶ 5, 8. The majority’s interpretation of federal law and interpretative statement are unsupported by any case law. In addition, neither at the Department level, in the district court, nor in this Court were the meaning or application of any of these laws or the interpretative statement cited in any way or for any purpose even remotely related to the new issues on which the majority rests its analyses and holding in the present case. {17} Further, in interpreting and analyzing the various provisions of federal law, the majority creates the notion of an inherent “tension” between a beneficial purpose of assisting people, on the one hand, with an onerous and unfair purpose of collecting overissuances, on the other hand. Majority Opinion, ¶ 7. The one case cited by the majority relating specifically to such a tension is shown to have held nothing more than that the state agency was required to notify food stamp recipients of the agency’s authority to compromise a claim for overissuance of food stamps. Majority Opinion, ¶ 7. In search for a remedy for the issue it created and decided of the Department’s abuse of discretion in failing to exercise its discretion to compromise or waive the claim, the majority concludes that the Department’s exercise of discretion to compromise or waive is an adequate remedy at law and, therefore, the Department must exercise such discretion before any determination can be made as to whether the Department properly established a claim. Majority Opinion, ¶¶ 8-9. {18} The district court mentioned the question of a payment schedule, and the Department explained that it had “the ability to compromise a claim if it cannot be paid within three years.” The recipient said nothing about it. The parties did not raise, the district court did not address, and on appeal in this Court the parties did not raise anything about a duty to exercise discretion to compromise or waive a claim, a breach of any such duty or an abuse of any such discretion, exhaustion of administrative remedies, having to reach legal issues before equitable ones where there is an adequate remedy at law, or postponement of a decision on equitable estoppel to first address the question of compromise. {19} Near the close of the Department’s answer brief, the Department did state that it would “work with [the recipient] to develop a reasonable payment schedule,” citing 8.139.640.12(B)(2)(c) NMAC, and stated further that if the claim could not be liquidated within three years “the Restitution Bureau can compromise the claim to an amount that will allow the household to make restitution within three years,” citing 8.139.640.10(D)(1) NMAC. It is unclear for what purpose the Department made these statements. However, the recipient did not respond to these statements in her reply brief. The majority does not rely on these statements in raising and addressing the new issues. In my view, these statements do not give any foot in the door to raise and decide new issues. Discussion {20} I have several issues with the majority opinion. {21} First and foremost, the majority opinion goes completely outside the issues that were raised, argued, and decided at the Department and district court levels. The Department is given no opportunity to respond to the new issues raised and addressed by the majority. It is not this Court’s prerogative in this case to sua sponte raise and address new issues, decide what federal law says in regard to those issues, and then, as the majority does, vacate the final order of the district court and remand back to the Department with instructions that the Department follow our interpretation of federal law and engage in the process of compromise. See Majority Opinion, ¶ 9. {22} Second, I am not persuaded that the majority’s approach to resolving the limited issues before this Court is proper. The majority leaves open the question whether a claim was properly established, and it does so because it leaves open the question whether the doctrine of equitable estoppel can apply, and it does that because it determines that the issue of compromise and apparently that of waiver1 must first be determined. It seems to me that the proper approach is the one taken in this case by the parties and the district court. I can understand the majority’s desire to avoid having to tackle the difficult question of the application of the doctrine of equitable estoppel. However, I am not persuaded that the issue of compromise must or should be decided before or even together with the question whether a claim can be established — a question that necessarily requires a determination whether equitable estoppel is applicable. Nor am I persuaded by the majority’s view that the law does not permit “engrafting ... equitable estoppel onto an administrative scheme when it appears that, properly interpreted, the governing statutes and regulations provide an adequate remedy at law.” Majority Opinion, ¶ 9. And I am not persuaded that the majority is correct in its view that the provisions of the law related to compromise provide an adequate remedy at law under the circumstances of this case. {23} Third, the recipient contested the claim only on the ground that the claim could not prevail because equitable estoppel precluded it. Further, there exists no question that the overissuance resulted from a Department administrative error. The Department acknowledged that in its hearing decision. Yet the opinion unnecessarily discusses facts and law apparently for the purpose of indicating its dissatisfaction with, if not hostility to, the Department’s enforcement of the food stamp overissuance law, the Department’s right to establish the overissuance claim even were equitable estoppel not applicable, and what it views as the Department’s incorrect interpretation of the law to permit it to establish a claim without first compromising it. See Majority Opinion, ¶¶ 3-4. I have difficulty finding a rational or legal basis for the majority’s views. The majority cites no case law that supports its analyses and interpretations of federal law as to duty to exercise discretion, breach of such duty, and abuse of such discretion. {24} Also, the majority cites case law on the purpose of the food stamp program and then states its view that there exists an “obvious tension between the purpose of the food stamp program and the very concept of recovering overpayments from a household that entirely depends upon governmental subsidies for the bare necessities of life.” Majority Opinion, ¶ 7. This further demonstrates the majority’s distaste for the federal food stamp law, but the majority does not assist in resolving the issues that were before the district court and are before this Court. Furthermore, there does not appear to be a tension between the purpose of the program and the Department having a right to establish a claim for overissuance where, under the laws and regulations, establishing a claim for overissuance is part and parcel of the program, and the program makes allowance for circumstances in which compromise is appropriate. {25} For the foregoing reasons, I respectfully dissent.  . I include waiver with compromise because the majority opinion appears to hold that the Department had a duty to exercise discretion in regard to both compromise and waiver.