Chester v. Apfel , 1 F. App'x 792 ( 2001 )

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
JAN 4 2001
FOR THE TENTH CIRCUIT
PATRICK FISHER
Clerk
AURORA L. CHESTER,
Plaintiff-Appellant,
v. No. 00-7021
(D.C. No. 97-CV-119-S)
KENNETH S. APFEL, Commissioner, (E.D. Okla.)
Social Security Administration,
Defendant-Appellee.
ORDER AND JUDGMENT *
Before BALDOCK, ANDERSON, and HENRY , Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument.
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
This case began with plaintiff Aurora Chester’s application for disability
and supplemental security income benefits. The Commissioner denied her
application, plaintiff sought review of the denial, and the district court affirmed.
This court then reversed the denial of benefits because of the administrative law
judge’s (ALJ) legal errors and remanded to the Commissioner for further
proceedings. Because plaintiff was the prevailing party in that civil action, she
filed a motion in the district court requesting attorney fees and costs pursuant to
the Equal Access to Justice Act (EAJA). See 28 U.S.C. § 2412(d)(1)(A). Under
the EAJA, the prevailing party in an action brought by or against the United
States is entitled to fees, other expenses, and costs “unless the court finds that the
position of the United States was substantially justified or that special
circumstances make an award unjust.” Id. The district court denied the motion
because it determined that the Commissioner’s position was substantially
justified. Because we conclude that the district court abused its discretion in
denying the motion, we reverse and remand. See Pierce v. Underwood , 487 U.S.
552, 559, 563 (1988).
In reaching our conclusion, we begin with the underlying proposition that it
is the Commissioner’s burden to show that his position was substantially justified.
Hadden v. Bowen , 851 F.2d 1266, 1267 (10th Cir. 1988). The “position” that
must be substantially justified includes not only the Commissioner’s position in
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the civil litigation, but also the agency’s action or failure to act. 28 U.S.C.
§ 2412(d)(2)(D); see also Hadden , 851 F.2d at 1267. And finally, the
Commissioner’s position is substantially justified if it is “justified to a degree that
could satisfy a reasonable person.” Pierce , 487 U.S. at 565. Stated differently,
his position must have a “reasonable basis both in law and fact.” Id. (quotation
omitted).
At the agency level, the Commissioner’s position is found in the ALJ’s
decision that plaintiff was not disabled (and, therefore, not entitled to benefits)
because her physical and mental limitations did not prohibit her from performing
her past relevant work. Plaintiff appealed that decision to the district court,
arguing, among other things, that the ALJ applied the wrong legal standard in
failing to properly develop the vocational record. Specifically, she argued that
the ALJ committed reversible legal error when he failed to establish the mental
demands of her past work and compare them to her mental limitations in finding
that she could perform her past work. 1
The district court disagreed and held that
the ALJ applied the proper legal standards, without explaining exactly how the
ALJ’s analysis satisfied his obligation. On appeal, we reversed, holding that the
1
Plaintiff presented several other arguments of ALJ error on appeal, but
since the failure to develop the vocational record was, by itself, an obvious legal
error for which the Commissioner offered no substantial justification, we need not
address the other points of alleged error.
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ALJ made a legal error in concluding plaintiff could perform her past work.
Consequently, in opposing the EAJA motion, the Commissioner must show not
only that his litigation position in defending the ALJ’s legal error was
substantially justified, but also that the initial legal error by the agency was
substantially justified.
Attempting to satisfy his burden to show that his position was substantially
justified, in his opposition to the EAJA motion the Commissioner pointed to only
one fact: that the district court found no legal error and affirmed the denial of
benefits. The Commissioner argued that “the fact that the [he] did prevail at the
district court level more than adequately supports the proposition that the
government’s position was substantially justified.” R. Vol. I at 43. Similarly, on
appeal, the Commissioner relies solely on the district court’s favorable decision
as evidence that his position was substantially justified. He states that the district
court’s finding that reasonable minds could differ as to whether the ALJ
committed legal error is, itself, sufficient to establish that a reasonable person
would see the government’s position as correct and, thus, substantially justified.
Appellee’s Br. at 8. However, the fact that one other court agreed with the
Commissioner, standing alone, does not establish that his position was
substantially justified. Pierce , 487 U.S. at 569; Hadden , 851 F.2d at 1267.
Because he offered no other argument of substantial justification, he failed to
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carry his burden. See Hadden , 851 F.2d at 1267 (“The government’s success or
failure on the merits at each level may be evidence of whether its position was
substantially justified, but that success or failure alone is not determinative of the
issue.”).
More important than the Commissioner’s technical failure to carry his
burden, however, is the fact that the record simply does not reveal a reasonable
basis for either the ALJ’s legal error, or the Commissioner’s litigation position in
arguing there was no error. The law is clear, as it was at the time the ALJ made
his decision, that the ALJ had a duty to develop the record by establishing the
mental demands of plaintiff’s past work and comparing them with her mental
limitations before he could conclude that plaintiff could perform her past work.
Henrie v. United States Dep’t of Health & Human Servs. , 13 F.3d 359, 360-61
(10th Cir. 1993); Winfrey v. Chater , 92 F.3d 1017, 1023-26 (10th Cir. 1996). As
we held on appeal, the ALJ simply did not fulfill that duty. He made specific
findings regarding plaintiff’s mental limitations (that she was limited to
performing jobs in low-stress, nonpublic environments which involved only
simple and repetitive tasks with limited co-worker contact), but he completely
failed to establish the mental demands of her past work, and it follows that he
also made no attempt to compare the mental demands of the job with her mental
limitations. See Chester v. Apfel , No. 98-7106, 1999 WL 360176, at **2-3 (10th
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Cir. June 4, 1999). This was a glaring legal error, and the record reveals no
reasonable legal basis for the ALJ’s failure to fulfill his obligation to develop the
record by making the required findings. As a result, the Commissioner can not
show that his position was substantially justified, either in making the initial legal
error or in arguing in the ensuing litigation that there was no error.
In sum, we conclude that the district court abused its discretion in denying
the EAJA motion for two reasons. First, the Commissioner bears the burden of
showing that his position was substantially justified, and his sole argument to that
end–that the district court agreed with his position when it affirmed the agency
action–does not, by itself, establish substantial justification. More importantly,
the record reveals no reasonable basis for either the ALJ’s obvious legal error in
failing to develop the vocational record in the first instance, or for the
Commissioner’s litigation position in arguing that there was no error.
Consequently, we REVERSE the district court’s denial of plaintiff’s EAJA
motion for fees and costs, and we REMAND for proceedings consistent with this
order and judgment.
Entered for the Court
Stephen H. Anderson
Circuit Judge
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