FEDERAL DISTRICT COURT RULES IN FAVOR OF SSI BENEFICIARY

The Social Security Administration was recently reproached by the United States’ Southern California District Court for failure to follow federal law and its own regulations in a case that has been remanded to an Administrative Law Judge.

Esther Conte is an 88 year-old widowed woman and 22-year recipient of Supplemental Security Income (“SSI”).  Her benefits were abruptly terminated in 2003 after the Social Security Administration determined that a gift of unearned income to her son was subject to an eligibility penalty period.  Under federal law, the Social Security Administration may terminate SSI benefits of people who transfer resources for less than fair market value.  Both federal law and regulations distinguish money as “income” in the month in which it is received and a “resource” after it has been retained into a second calendar month.  The SSI penalty for beneficiaries applies solely to transfers of resources.

In remanding the lawsuit to an Administrative Law Judge to determine when Mrs. Conte’s money was received, the Honorable Larry Alan Burns found that the “time of receipt is not immaterial but dispositive of this case.”  The Judge directly refuted the Social Security Administration’s argument that all monetary gifts could be penalized, regardless of whether such gifts were of “income” or “resources.”  This argument is “contrary to [the Social Security Administration’s] own regulations.”  

Judge Burns’ ruling comes 34 months after Mrs. Conte’s vital SSI benefits were terminated.  During that time, Mrs. Conte exhausted Social Security’s plodding appeals system while the Administration persisted on a statutory interpretation that contradicted federal law and its own regulations and policy manual.

Mrs. Conte was represented by Elder Law & Advocacy, a nonprofit provider of free legal services to senior citizens of San Diego and Imperial Counties.  If you have any questions about the case or Judge Burns’ ruling, please call Anthony Chicotel, staff attorney for Elder Law & Advocacy at (858) 565-1392.