Opinion
Case No. 3:98CV00093
August 23, 2000
Charles Cooper Geraty, III, Geraty, Macqueen Vitt, Charlottesville, Va, for Lyndon Long, plaintiff.
John F. Corcoran, U.S. Attorney's Office, Roanoke, Va, for Kenneth Apfel, Commissioner of Social Security, defendant.
Randolph W. Gaines, Social Security Administration, Baltimore, MD, for Kenneth Apfel, Commissioner of Social Security, defendant.
MEMORANDUM OPINION
This court referred the above-captioned case to United States Magistrate Judge B. Waugh Crigler under the authority of 28 U.S.C. § 636(b)(1)(B) to set forth findings, conclusions, and recommendations for its disposition. Under such authority, the Magistrate Judge was charged with advising this court whether the final decision of the Commissioner of Social Security ("Commissioner") is supported by substantial evidence, should be remanded for further proceedings, or should be reversed. In his February 4, 2000 Report and Recommendation, the Magistrate Judge recommended that this Court remand the case forthwith to "the Commissioner for further, rather narrowly focused, proceedings in which the same [Vocational Expert] would be given an opportunity to consider the vocational effects of all [of] plaintiff['s] mental impairments." Pursuant to Rule 72(b), both the Commissioner of Social Security and the claimant filed objections to the Magistrate Judge's Report and Recommendation.
In accordance with 28 U.S.C. § 636(b)(1)(C), "A judge of the court shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made. A judge of the court may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate." See also Fed.R.Civ.P. 72(b). Under such authority and with due consideration, this court adopts the findings of the Magistrate Judge's Report and Recommendation with respect to its reasoning and conclusions but rejects its recommendation of the ultimate disposition. Among other things, this court adopts the finding that the plaintiff made out a prima facie case of disability which the Commissioner failed to rebut, and agrees that the Commissioner inappropriately disregarded the vocational expert's advice, substituted his own judgment for that of his expert, and inappropriately applied the grids in spite of the claimant's nonexertional impairments. Furthermore, this court finds, for reasons independent from the Magistrate, insufficient evidence to support the Administrative Law Judge's ("ALJ") determination that the claimant's nonexertional conditions do not amount to nonexertional impairments which affect his vocational abilities. In addition, the court agrees with the plaintiff's assertion that, not only did the ALJ inappropriately apply the grids to the claimant, he misapplied the grids. Accordingly, the court finds that the Commissioner's erroneous decision is not binding. Finally, the court departs from the Magistrate Judge's dispositional recommendation of a narrow remand, instead reversing and remanding for calculation of benefits below.
See 42 U.S.C. § 405(g); Coffman v. Bowen, 829 F.2d 514, 517 (4th Cir. 1987); Meyers v. Califano, 611 F.2d 980, 982 (4th Cir. 1980).
I.
Lyndon Long applied to the Social Security Administration for Disability Insurance Benefits and Supplemental Security Income payments on October 22, 1993 under sections 216(i) and 223 of the Social Security Act. Long alleged an inability to work, beginning November 9, 1992, due to heart and back conditions. In a decision eventually adopted as the final decision of the Commissioner, the ALJ found that the claimant met the requirements for insured status from the date of his alleged disability onset through March 31, 1995. Both applications were initially denied and likewise adjudicated on reconsideration.
Following a hearing on February 22, 1995, the ALJ found that the claimant was not disabled and thus not entitled to the benefits sought. Subsequently, the Appeals Council, in an Order dated November 3, 1995, remanded the case for further proceedings to resolve the extent of Long's mental impairments, including, but not limited to, inquiries into his adjustment disorder and mental retardation. On July 10, 1996, a second trial before the same ALJ again resulted in a denial of all benefits. This denial became the final decision of the Commissioner which was appealed to this court.
As detailed in his Report and Recommendation, the Magistrate Judge found that the ALJ erred because he, "discounted the Commissioner's own medical evidence, acted as his own medical expert, and then disregarded the regulatory requirements that he rely on vocational evidence in discharge of the Commissioner's sequential burden and relied on the grids to compel a conclusion of `not disabled' under the act." (Report and Recommendation, 3.) In response to the Magistrate Judge's Report and Recommendation, both the plaintiff and the defendant filed objections. The defendant objected that the Magistrate Judge gave enhanced weight to unreliable medical evidence despite Congress having limited the review of the Commissioner's decision to determining whether such decision is supported by substantial evidence. On the other hand, the plaintiff agreed with the reasoning of Magistrate Judge, asserting that the ALJ inappropriately applied the grids and in so doing misapplied the grids.
II.
This court is charged with reviewing the Commissioner's denial of Disability Insurance Benefits and Supplemental Security Income Benefits to determine whether:
1) the ALJ applied the correct legal standards and 2) the decision is supported by substantial evidence. See 42 U.S.C. § 405(g); Hunter v. Sullivan, 993 F.2d 31, 34 (4th Cir. 1992); Hays v. Sullivan, 907 F.2d 1453, 1456 (4th Cir. 1990). As the presiding officer at the administrative hearing, the ALJ makes factual determinations and resolves evidentiary conflicts, including inconsistencies in the medical evidence. See Hines v. Bowen, 872 F.2d 56 (4th Cir. 1989). This court gives great deference to the ALJ's factual determinations and reviews them only for clear error. See Estep v. Richardson, 459 F.2d 1015, 1017 (4th Cir. 1972). Nonetheless, this reviewing court is not restrained by deference to the administrative decision in determining whether the correct legal standards were applied — a de novo determination of legal issues is obligatory. See Bowen, 872 F.2d at 58; Meyers v. Califano, 611 F.2d 980, 982 (4th Cir. 1980). Pertinent to this case, determining whether the evidence presented by the ALJ to support his decision amounts to substantial evidence is a question of law and, therefore, will be considered anew. See Hicks v. Heckler, 756 F.2d 1022, 1024-1025 (4th Cir. 1985).
Substantial evidence is defined as, "`such relevant evidence as a reasonable mind might accept as adequate to support a conclusion,'" Richardson v. Perales, 402 U.S. 389, 401 (1971) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)). Substantial evidence consists of more than a mere scintilla of evidence but may be less than a preponderance. See Laws v. Celebrezze, 368 F.2d 640, 642 (4th Cir. 1966). The court must consider both evidence that supports and evidence that detracts from the Commissioner's conclusion; it may not affirm by isolating a specific quantum of supporting evidence. See Jones v. Heckler, 760 F.2d 993, 995 (9th Cir. 1985). The Commissioner's decision, "if supported by substantial evidence [in the record as a whole] must be affirmed even though the reviewing court believes the substantial evidence also supports a contrary result." Richardson, 459 F.2d at 1017. When reached by means of an improper standard or misapplication of the law or in the event that substantial evidence does not support the Commissioner's decision, factual findings made by the ALJ are neither conclusive nor binding. See Meyers, 611 F.2d at 982; Coffman, 829 F.2d at 517.
III.
The Social Security Act, 42 U.S.C. § 423 (d)(1)(A), defines a "disability" as: "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 not less than 12 months." In determining whether a claimant is disabled, the ALJ follows a sequential five-step process outlined at 20 C.F.R. § 416.920. The sequential inquiry determines whether the applicant (1) is gainfully employed, (2) has a severe impairment that limits ability to perform basic work functions, (3) has an impairment that makes the applicant disabled as a matter of law, (4) is able to perform past relevant work, and (5) can perform work available in significant numbers in the national economy. See 20 C.F.R. § 416.920. The claimant bears the burden of production and proof during the first four steps of the inquiry. If he is able to carry the burden through the fourth step, the burden then shifts to the Commissioner in the fifth step.
In the instant case, claimant was able to meet his burden of proof in the aforementioned sequential process, thus proving that he is not working and is unable to perform his past work and shifting the burden to the Commissioner on step five. The parties do not dispute the claimant's prima facie showing of disability. In an attempt to satisfy the Commissioner's burden on the fifth step, the ALJ employed a Vocational Expert ("VE") who found that no work is available to the claimant in significant numbers in the national economy. Although such a finding by the ALJ's own expert normally implicates a declaration of disability, the ALJ disregarded the VE's opinion because it relied on the claimant's allegedly unreliable, unsubstantiated testimony to reach that conclusion. (R. 28.) In lieu of the expert's testimony, the ALJ relied on Rule 201.24 of the Medical Vocation Guidelines contained in 20 C.F.R. Part 404, Subpt. P, App. 2, to conclude that the claimant is not disabled. (R. 28.)
The court notes that, although referred to as a sequential process, the claimant need not meet step 3 in order to proceed to step 4. Because step 3 determines whether the claimant is disabled as a matter of law, if the claimant carries the burden on step 3, he is awarded benefits and the case is over.
IV.
The court's question in this case is whether the Commissioner properly utilized the Medical-Vocational Guidelines, 20 C.F.R. Part 404, Subpt. P, App.2, ("the grids") to met his burden of proof on the fifth step of the sequential inquiry process. The ALJ uses the rules established in the grids to decide if other jobs exist in significant numbers in the national economy which an individual, like the claimant, would be able to perform, taking into account his functional limitations, age, education and work experience. See English v. Shalala, 10 F.3d 1080 (4th Cir. 1983). However, the rules established in the grids are not always applicable — "[T]he regulations themselves specifically provide that where the claimant's impairment is nonexertional — not manifested by a loss of strength or other physical abilities — or is marked by a combination of exertional and nonexertional impairments, the grids' Rules are not conclusive, and full individualized consideration must be given to all relevant facts of the case." Grant v. Schweiker, 699 F.2d 189 (4th Cir. 1983).
Without the use of the grids, the ALJ's only means to meet the fifth step's burden is through reliance on expert vocational advice. Where a claimant "demonstrates the presence of nonexertional impairments, the Secretary, in order to prevail, must be required to prove by expert vocational testimony
that, despite [the claimant's] combination of nonexertional and exertional impairments, specific jobs exist in the national economy which he can perform. The grids may satisfy the Secretary's burden of coming forward with evidence as to the availability of jobs the claimant can perform only where the claimant suffers solely from exertional impairments."Grant at 699 F.2d at 192. Following this decision, the Fourth Circuit clarified its position on what qualifies as a nonexertional impairment:
"Although Grant makes clear that reliance on the grids is precluded where the claimant suffers from a `nonexertional impairment,' not every malady of a `nonexertional' nature rises to the level of a `nonexertional impairment.' The proper inquiry, under Grant, is whether a given nonexertional condition affects an individual's residual capacity to perform work of which he is exertionally capable. If the condition has that effect, it is properly viewed as a `nonexertional impairment,' thereby precluding reliance on the grids to determine the claimant's disability."
Smith v. Schweiker 719 F.2d 723, 725 (4th Cir. 1984). Under the Smith test, the ALJ must first determine if given conditions rise to the level of nonexertional impairments. See 719 F.2d at 725. This inquiry is a question of fact and is therefore reviewed by this court only to evaluate if the finding is supported by substantial evidence. In the instant case, the ALJ determined that the claimant suffers from four severe impairments: two exertional, cardiomyopathy and hypertension, and two nonexertional, an adjustment disorder and borderline intelligence. As to these impairments the ALJ made two pertinent findings: 1) "The evidence supports a finding that Mr. Long has cardiomyopathy, hypertension, an adjustment disorder and borderline intelligence, impairments which cause significant vocationally relevant limitations" (R. 25) (emphasis added), and 2) "The claimant has no significant non-exertional limitations which narrow the range of work he is capable of performing" (R. 29.) These findings are contradictory of one another and cannot reasonably coexist for two reasons — First, nonexertional limitations are significant if they cause vocationally-relevant limitations. See Smith, 719 F.2d at 725. The ALJ included the plaintiff's non-exertional conditions in his list of "impairments which cause significant vocationally relevant limitations" (R. 25), but then goes on to label the non-exertional limitations "insignificant" (R.29.) Second, the ALJ refers to the plaintiff's non-exertional conditions as both "limitations" (R. 29) and "impairments" (R. 25.). This is a legally significant error based on the distinctions made in Smith. See 719 F.2d at 725. A reasonable mind cannot accept the ALJ's contradictory statements as adequate evidence to support the conclusion that the claimant does not have nonexertional impairments. Richardson v. Perales, 402 U.S. 389, 401 (1971). Thus, the internal inconsistency renders the ALJ's finding that the claimant has no significant nonexertional limitations that narrow his capable range of work unsupported by substantial evidence.
The record as a whole supports the conclusion that the claimant's adjustment disorder and borderline intelligence rise to the level of nonexertional impairments. It is fair to say that two nonexertional conditions which the ALJ himself characterized as " impairments causing significant vocationally-relevant limitations," (R. 25) (emphasis added), do in fact affect "an individual's residual capacity to perform work of which he is exertionally capable," Smith, 719 F.2d at 725. In light of the ALJ's own finding that claimant's borderline intelligence and adjustment disorder significantly affect his work performance, the already narrow range of work available to the claimant, if any, is further reduced. According to the Smith test, if nonexertional limitations affect a claimant's residual functional capacity, then the ALJ cannot rely on the grids in order to meet his burden on the fifth step of the sequential inquiry. See 719 F.2d at 725. Thus, the ALJ erroneously utilized the grids, which are intended to direct disability determinations for claimants who suffer solely from exertional impairments, to compel a decision of not disabled for the instant claimant who suffers from two "significant vocationally-relevant," (R. 25), nonexertional impairments. Accordingly, the court adopts the Magistrate Judge's report and recommendation to the extent that it concludes that it was improper for the ALJ to apply grids to the claimant because of his nonexertional impairments.
Without the assistance of the grids, the ALJ is compelled to follow the advice of the VE as a matter of law. See Grant 699 F.2d at 193. Like the expert before him at the first administrative hearing, the instant VE opined that there are no jobs available to a person with the claimant's impairments in significant numbers in the national economy. (R. 432-435.) Thus, the Commissioner's failure to rebut the claimant's prima facie showing of disability renders the claimant conclusively disabled and entitled to benefits.
V.
In addition to the ALJ's inappropriate reliance on the grids to deny the claimant's benefits, the grids themselves suggest a finding of disability in this case. Under 20 C.F.R. Pt. 404, Subpt. P, App. 2 § 201.00(h), the regulations give examples to illustrate how a younger claimant, such as the plaintiff, may be entitled to benefits. Example 2 describes:
"An illiterate 41 year old individual with mild mental retardation
(IQ of 78) is restricted to unskilled sedentary work and cannot perform vocationally relevant past work which had consisted of unskilled agricultural field work; his or her characteristics do not specifically meet any of the rules in appendix 2, because this individual cannot perform the full range of work defined as sedentary. In light of the adverse factors which further narrow the range of sedentary work for which this individual is qualified, a finding of disabled is appropriate."
This example envisions a claimant remarkably similar to the instant claimant on all of the criteria relevant to the fifth step in the sequential inquiry: age, residual functional capacity, education, and work experience. Both are considered younger individuals, limited to sedentary work, with only unskilled work experience. Educationally, the instant claimant is nearly functionally illiterate, reading at a second grade level, with an IQ score somewhere in the range of 60 to 71, whereas the individual in the example is fully illiterate but with an IQ score of 78. Thus, the difference between these two claimants is a minimal difference in the literacy level and a seven-point difference in IQ, with the instant applicant having a more severe impairment in intellectual functioning.
A tentative application of the grids to both the example individual and the plaintiff results in the use of grid rules 201.23 and 201.24, respectively, with the difference in the applicable rule a result of the literacy subcriterion. Both grid rules suggest a finding of "not disabled," as the ALJ made in this case, but both refer the reader to a particular footnote. However, the ALJ apparently failed to read the footnotes attached to these rules which direct him to, "See 201.00(h)." Section 201.00(h) provides the above-quoted similar example and warns the ALJ against misapplication of the grids to individuals with nonexertional limitations. The close similarity of the claimant's characteristics to the example provided in § 201.00(h), coupled with the claimant's nonexertional limitation being of a higher degree than those of the example individual, 20 C.F.R. Pt. 404, Subpt. P, App. 2 § 201.00(h) begs the conclusion that the claimant is disabled.
VI.
In light of 1) the insubstantial evidence to support the ALJ's determination that the claimant suffers from a nonexertional limitation that does not significantly affect his vocational abilities, and 2) the incorrect application of the grids to the claimant on the Step Five of the Sequential Evaluation Process, the Commissioner's denial of Disability Insurance Benefits and Supplemental Security Income payments was erroneous. The plaintiff has asked this court to reverse the Commissioner's decision and direct an award of benefits or, in the alternative, follow the Magistrate Judge's recommendation to remand the case to the Commissioner for the narrow purpose of soliciting expert vocational testimony which takes into account the claimant's mental, nonexertional limitations. The court has the statutory authority to do either. See 42 U.S.C. § 405(g); Vitek v. Finch, 438 F.2d 1157 (4th Cir. 1971). In light of the court's agreement with the Magistrate Judge that the Commissioner has had "the proverbial full bite at the apple" to meet his burden and failed, and the fact that this case has already been remanded by the Commissioner's own Appeals Council for reconsideration of Long's mental limitations and the nearly eight years since the claimant was denied his rightful benefits, it is time that this matter comes to a close. See Taylor v. Weinberger, 152 F.2d 664, 668-669 (4th Cir. 1975).
Therefore, we REVERSE the Commissioner's denial of disability status with instructions to REMAND for a computation of the benefits due to the plaintiff.
ORDER
By order dated January 13, 1999, the court referred the above-captioned case to United States Magistrate Judge Crigler for proposed findings of fact and recommendations. On February 4, 2000, Magistrate Judge Crigler filed his Report and Recommendation, advising the Court to remand the case for a specified, narrow proceeding. The defendant filed objections to the Report and Recommendation to which the plaintiff responded, both in a timely manner. Pursuant to 28 U.S.C. § 636(b)(1)(C), the court "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made. A judge of the court may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate." Having thoroughly considered the report and recommendation, the parties' positions, and the entire record, the court overrules the defendant's objection and adopts the findings of the report and recommendation with respect to its reasoning and conclusions but rejects its recommendation of the ultimate disposition. Accordingly, for the reasons stated in the accompanying Memorandum Opinion, it is this day as follows:
ADJUDGED, ORDERED, AND DECREED
1. Magistrate Judge Crigler's February 4, 2000 report and recommendation shall be, and hereby is, ADOPTED in part and REJECTED in part.
2. The defendant's objections to the report and recommendation shall be, and hereby are, OVERRULED.
3. The decision of the Commissioner dated September 16, 1996, which was adopted as the final decision of the Commissioner, shall be, and hereby is, REVERSED.
4. This case shall be, and hereby is, REMANDED for an award of benefits to the plaintiff.
The Clerk of Court hereby is directed to send a certified copy of this Order to the Magistrate Judge and to all counsel of record.