Barnhart, Social Security Comm. v. Walton, Cleveland (03/27/2002)

By: Beth Musgrave, Medill News Service

Questions presented

(1) Is a person entitled to disability benefits under the Social Security Act if he has a physical or mental impairment that has lasted or can be expected to last at least 12 months, but his inability to engage in substantial gainful activity by reason of that impairment has not lasted or cannot be expected to last 12 months? (2) May the person be under a disability and entitled to a ""trial work period"" if, at the time his disability insurance benefits claim is adjudicated, his impairment no longer prevents him from performing substantial gainful activity?

Brief

Virginia native Cleveland Walton has suffered psychological problems most of his life.

In March of 1995, the former in-school suspension teacher was diagnosed with schizophrenia and associated depression after a six-day hospitalization. He applied for disability insurance benefits and supplemental Social Security income, known as SSI, on April 12, 1995. His application was initially denied.

After a hearing more than a year later, an administrative law judge ruled that Walton was disabled. A psychiatrist reviewed Waltons medical history and concluded that Waltons disability -- schizophrenic disorder with psychotic features -- met the criteria for a disability and that impairment had lasted 12 months, a central determination in how the Social Security Administration defines disability.

Walton also advised the administrative law judge that he had worked part-time at a local grocery store, Food Lion, from May 1995 until Dec.10, 1995, when he began working there full-time.

The administrative law judge determined that Walton was entitled to benefits for a period of disability that began on Oct. 31, 1994 — when he stopped working as an in-school suspension teacher and ended on Dec. 10, 1995 — when he started to work full-time at Food Lion.

The case then went to a Social Security appeals board. The Social Security Administration asserted that Walton had worked, or had engaged in ""sustained gainful activity"", less than 12 months after he was diagnosed as mentally disabled. He was therefore not disabled and not entitled to benefits.

The appeals board remanded the case to the administrative law judge to decide when Walton began a period of sustained gainful activity. The judge ruled that Walton began a period of sustained gainful activity in October 1995, when his earnings exceeded $500, a standard set by Social Security rules. Walton therefore was not disabled and not entitled to benefits.

Walton appealed the Social Security Administrations decision to the U.S. District Court for the Eastern District of Virginia. The court upheld the Social Security Administrations decision. Walton then appealed to the 4th Circuit Court of Appeals, which ruled that Walton was disabled when he worked, was entitled to a trial work period and therefore eligible to collect benefits.

In a unanimous decision, Judge J. Michael Luttig stated that the statutory language defining disability is clear and the Social Security Administrations interpretation of the statute is incorrect. Disability is ""the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of no less than 12 months,"" according to the statute.

Luttig said the clause ""which can be expected to result in death or which has lasted or can be expected to last for a continuous period of no less than 12 months,"" refers to the disability and not substantial gainful activity. Furthermore, the administrative law judge in the first hearing found that Walton was disabled. Social Security rules allow a trial work period to begin prior to the 12 months from the disability onset.

Writing for the Social Security Administration, the U.S. Solicitor General, in its petition to the Supreme Court, said the same question about whether or not a person who applies for disability benefits can work has been addressed in the 10th and 8th Circuit Courts of Appeals. Both courts ruled in favor of the Social Security Administrations interpretation of the statute.

Moreover, because the statute does not directly address the issue of how long someone can work and still receive benefits, the director of the Social Security Administration interpreted the statute to mean that a person could not work for 12 months, which the agency claims was the spirit of the law when Congress enacted the statute.

The brief also argues that if the 4th Circuit Court of Appeals decision is upheld, it would cost the agency more than $9.8 billion over the next 10 years, because it would increase the number of people eligible for disability benefits.

Walton was awarded back benefits after the appeals decision. He is also receiving Social Security benefits because of a claim he filed after his 1995 that entitles him to Social Security.

On Sept. 25, 2001, the U.S. Supreme Court granted certiorari in the case.

On March 27, 2002, the Court sided unanimously with the Social Security Administration, holding that the agency's reading of the statute was reasonable.

Justice Stephen Breyer wrote the Court's lead opinion, Justice Antonin Scalia adding a concurrence.