Wallberg v. Utah Public Welfare Commission , 115 Utah 242 ( 1949 )

I concur in the conclusion that there is no unconstitutional discrimination in limiting the lien requirement solely to the owners of real property. Since I approach the questions posed by the appeal differently than does the author of the prevailing opinion, I prefer to base my conclusions on my own reasoning.

A lien on realty is not an object in itself like real estate. It is something intangible. It is a short way of saying that one has a right to resort to the specific property of another (the property subject to the lien) for the payment of a debt, obligation, reimbursement or other sum. For reasons which I shall presently point out, there is no arbitrary classification involved in requiring, on the one hand, only those owning real estate to agree to permit the state to reimburse itself from the said real estate for assistance given; and on the other hand, not requiring nonowners of real estate to guarantee reimbursement. In short there is no arbitrary classification involved in requiring occupying home owners to comply with the giving of a lien as a condition for receiving assistance. I shall hereafter in this opinion refer to this as the "lien condition."

The enlightened policy reflected by the Public Assistance Act of 1947 in providing needy individuals in this state over the age of sixty-five years who do not have sufficient resources actually available for their use to maintain a minimum standard of living compatible with health and well being and including provisions for the aid to the blind, dependent children and other public assistance was in its nature revolutionary as compared with the old haphazard, unsocial, unintelligent and inhumane methods symbolized by the poor house, the infirmary, loan of children to industry and other practices noted by Charles Dickens and accepted as necessary and inevitable during and before his time. The history of many thousands of the cases of the aged was a history of pathos and misery during the twilight of their lives. At least we have come a little way along the road toward realizing our duty to society's unfortunates. But the aid must necessarily come out of the public funds and ultimately out of the pockets of the taxpayers. The legislature deemed it advisable, if not necessary, to place conditions upon this largess — for, in the sense that there was no legal or contractual duty on the part of the state, but only a compulsion of ethics and enlightenment — largess it was.

It is not meant to infer that their legislation might be so drawn as to include an unconstitutional discrimination in the fixing of the lien condition. A red headed man could not legally be exempt from the condition and a black haired man subjected to it. The broad principles set out in State v. Mason, 94 Utah 501,78 P.2d 920, 117 A.L.R. 330, apply to these conditions. There must be a reasonable basis for the differentiation between that class made subject to the lien condition as compared with the class not subjected to it which basis must bear areasonable relation to the purposes to be accomplished by the imposition of the condition. If those subjected to the condition are similarly situated to those free from the condition, the differentiation would be without basis and hence arbitrary and therefore unconstitutional. The important, and perhaps some what tricky words in the above passage, is the word, "reasonable", and the phrase, "similarly situated." And they must be invested with meaning in the light of the purposes to be accomplished by the lien condition. It will later appear as we study Section 19(a) that applicants owning homes are differently situated with respect to the purposes to be subserved by the condition of requiring a lien than are those with no property or with not enough personal property to be disqualified as a beneficiary under Section 4 of the Act.

We may see this more clearly if we consider for a moment where the circle is drawn which includes those which may be beneficiaries under the Act and which at the same time excludes all those who fall out of the circle. The circle is drawn to include the aged needy and exclude the non-needy. And who are the needy? Those who have not sufficient resources actually available to maintain a minimum standard of living compatible with health and well being. And how is that class defined? A person living alone possessing up to, but not to exceed, $300 in money or other tangible personal property or its equivalent in real or personal property or with life insurance policies up to, but not exceeding in the aggregate, $500 cash value falls within the circle encompassing the beneficiaries. Also, two or more persons living together as a family unit with up to $600 in money or personal property or non-home real estate or with insurance policies of no more than $1000 in aggregate cash value, also fall within the circle except that a

"home owned and occupied by the applicant and the furniture or furnishings therein, but [said furniture or furnishings] not to exceed $300.00 for an individual living alone or $600 for two or more persons living together as a family unit" (italics added),

shall not be included in determining the value of the tangible property or its equivalent in real or personal property which marks the line between eligible and ineligible applicants.

Since one of the very purposes of the Act was to assist the needy of the age of 65 or over, it would seem inevitable that in order to classify all of the needy of 65 years or over from the non-needy of any age, the inclusion-exclusion lines, which would be required to subserve that purpose must be lines separating those 65 years or over from those under 65, and separating those having no property or property not exceeding a certain worth from those having property exceeding that worth. The age limit could have been fixed at other than at 65, and the property value line at different figures. The inclusion-exclusion line as far as property worth is concerned was not a horizontal one. The legislature did what it must do in almost all classifying. It found it wise to draw a line according to the exigencies.

Thus it admitted into the circle of eligibles individuals living alone who owned no more than $300 worth of money or other tangible property, or its equivalent in real or personal property, and for a family unit it made the dividing line $600, and made likewise a difference in the aggregate cash value of insurance policies which would not disqualify a family unit whereas it would a person living alone. And most significant it did not make eligibility depend on the value of a home owned and occupied.

While there may be some doubts as to the meaning of some of the phrases of Section 4, it appears quite definite that a home owned and occupied by an applicant individually or as a family unit regardless of value, and whether encumbered or unencumbered, does not disqualify such applicant from receiving assistance. It is notable that none of the applicants, disqualified because of ownership of property beyond the amounts specified, has contended that an unconstitutional classification results because other applicants owning and occupying a home worth far more than the specified limits of personal or real property (not used as a home) are admitted within the circle of beneficiaries. In short, a person or family unit may be admitted to the eligible group of needy even though the value of the home owned and occupied is far greater than the value of the money or other personal or real property (other than an occupied home), ownership beyond which amount would disqualify an applicant who did not own and occupy a home. No one has yet contended that the home owner eligible for assistance despite the fact that he is permitted to own a home of undefinite value so long as he or his family occupy it, is not similarly situated in respect to the purposes of the Act as is his less fortunate non-home owning neighbor; nor that applicants owning and occupying homes up to any value are in a differentiable class from those who own nothing or who own real property not used for a home or personal property not exceeding the limits set out in Section 4. "Similarly situated" does not mean situated exactly the same or identically situated. If that were so, applicants would all have to own the same amount and perhaps the same kind of property. "Similarly situated" as applied to the main purpose of the instant act, means all applicants must have arrived at the required age and all must have the common quality of being "needy." So long as the Act draws the circle of inclusion to take in such persons provided needy is reasonably defined in view of the purposes of the Act and reasonably calculated to effectuate them, there may be variations to the type and kind of property owned up to the limits set and seemingly with no value limit as to a home owned by the recipient, and occupied by him or by him and his family.

Said Mr. Justice Stone in upholding unemployment compensation legislation having in mind that he was dealing with a statute conferring benefits rather than one imposing obligations:

"* * * the legislature is not bound to occupy the whole field. It may strike at the evil where it is most felt * * *, or where it is most practicable to deal with. * * * It may exclude others whose need is less * * * or whose effective aid is attended by inconvenience which is greater." Carmichael v. Southern Coal Coke Co., 1937, 301 U.S. 495, 57 S. Ct. 868, 877, 81 L. Ed. 1245, 109 A.L.R. 1327, 1339.

It is generally recognized that a law is not unreasonably discriminatory just because the legislature has not included all possible classes and situations:

"* * * every legislative act is in one sense discriminatory. The Legislature cannot [in one act] legislate as to all persons or all subject matters. It is inclusive as to some class or group * * * and exclusive as to the remainder." State v. Mason,94 Utah 501, at page 507, 78 P.2d 920, at page 923.

See also State v. Walker, 100 Utah 523, 116 P. 766, and the following statement from Van Cott, Constitutional Law (1948), p. 148:

"A classification having some reasonable basis does not offend against that [the equal protection] clause merely because it is not made with mathematical nicety, or because in practice it results in some slight inequality."

I am inclined to believe that in legislation such as that with which we are now dealing, designed to grant assistance to groups according to the circumstances which attend their needs, the allowable lines of differentiation need not be drawn as rigidly as in those cases where any substantial disparity of treatment in regard to those similarly situated would give rise to economic advantage to some in the class and corresponding economic disadvantage to the remainder. In the instant case variations in the lines differentiating one class from another would not result in disturbing competitive positions of the members of a class or throw out of adjustment the balance of previously existing relationship of burdens, obligations or privileges between classes or between members of the same class.

To bring the matter into the realm of the concrete, the placing of a lien on the home of an applicant leaves him economically in a less advantageous position than he would be if the lien had not been imposed, but does not materially affect his economic position in reference to any of the fellow members of the class in which he is placed. An applicant with no property or with property not in excess of the disqualifying limit or even with property in excess of the qualifying limit, and hence out of the circle of beneficiaries, is no worse or better off than he would be if the applicant compelled to give a lien were not so required to give it; nor is any applicant required to give a lien any worse or better off because some other applicant is compelled to give a lien. The requirement that certain applicants give liens does not economically disturb anyone in or out of the circle of beneficiaries. It does disturb the giver of the lien in that he is not as well off as he would be if he did not have to give a lien. The change in the status of the lien giver economically or legally affects only himself and not the legal or economic position of any other beneficiary in the circle or any person out of it.

The purpose in most cases of classification is to so draw the lines that persons or entities situated substantially in similar economic, legal or competitive positions in reference to the objects to be accomplished are treated alike in that they are grouped in the same class so that their competitive economic positions will remain relatively the same insofar as the impact of the legislation upon them is concerned. We have no such problem in the instant case.

In view of what was above said, we now return to a consideration of the question as to whether the requirement that the home owner give a lien on the home occupied by him and/or his family as a condition of receiving assistance works an unconstitutional discrimination against such home owner and in favor of the non-home owner applicant. It can be seen now that various parts of the act form a pattern. The legislature meant to utilize for the eligible applicants their homes if they were used or occupied as such. That may have been the main reason why no limit was placed on the value of the home as a factor for eligibility. It was the legislative policy to keep the home intact. The legislature may have reasoned that there was no necessity to put any limit on the value of the home used and occupied as such as a condition of such home owning applicant receiving assistance because the state could require that it be security for the assistance given, less exemptions up to the value of the home. That may have been the very reason why the legislature in Section 4 included in the group of eligibles those who owned and occupied a home without limit of value if they were otherwise needy. The legislature could have required every home owner to surrender his home or some part of the value thereof as a condition of eligibility to receive assistance. It did not do so. It chose rather to leave the title and the right of occupancy of the home to the owner and his family, and then take a lien for reimbursement of assistance given which would be satisfied after the applicant's death or at the time he might desire to transfer the home.

I do not mean to infer that, absent a lien requirement, there would be an unconstitutional discrimination in favor of the home owner and against the non-home owner in respect to eligibility for assistance. I am simply pointing out that the legislature may have thought that as a quid pro quo for permitting the home owner to take his home with him into the circle of beneficiaries, it was only fair and more equitable to the non-home owners — the poorer applicants — that the home owner be required to give this lien as security for reimbursement. This idea is suggested in the main opinion, that the requirement was for the purpose of placing the non-home owning group on a more equal footing with the home owning group.

I think, however, that the main reason for the lien to secure reimbursement was that of economy.

Public welfare costs were mounting and state funds for the program were running low. The barrel of public funds is not bottomless nor are the more ultimate resources from which those funds are derived limitless. In order to make the benefits available to all needy aged and in adequate amounts, the lawmakers had to consider ways and means of effecting savings. They found from previous experience (the lien requirement in force before the repealing act of 1937, sec. 76A-3-21, Utah Code Ann. 1943) that liens can be helpful in two ways: (1) Directly, to refill in part at least the coffers of the public treasury, and (2) indirectly, to relieve the assistance rolls of those whose prospective heirs prefer to support their relatives (see 91-0-1 Utah Code Ann. (1943), rather than go without their inheritance. For the reasons stated above, I think the classification between those in the circle from whom liens are required and those not required to give them is constitutional.

It is contended that the third paragraph of Section 19(a) is unconstitutional in that it provides that if the applicant is a home owning married man, his wife shall be required as a condition to his obtaining assistance, to join him in the agreement giving the state a lien unless he is living apart from his wife and her joinder cannot be obtained. It is contended that this is discriminatory as against the wife who adheres to her husband since she signs away her inchoate rights whilst the wife who is maritally separated retains her right. It is true that there is a discrimination, but it is not unreasonable and unconstitutional. It is a discrimination which arises out of the necessities of the case — out of the necessity for obtaining an effective lien. Security of the property for reimbursement would be ineffective if the state could not pass a good title free from encumbrance of dower.

We are not concerned with legislative policy in this regard, but only with its powers. Whether, under the general policy of holding a family together which is inherent in the act and for that reason permitting the applicant to retain his home, the requirement that the wife who cleaves must surrender her statutory interest may not, in older married couples, lead to fictitious separations for the purpose of retaining some portion of the property and thus be a force working against the general social policy inherent in the Act is not for us, but for the legislature to determine. The legislature must have thought that in people who have reached the age of 65 the probability that such a provision would encourage separation, and especially by connivance, would be comparatively rare. The legislature must have weighed against those factors the consideration that where the wife lives with her husband she would, in the great majority of cases, share his assistance payments especially in cases where she has not reached the age of sixty-five. This would itself tend to keep them together even though she surrendered her statutory interest in his home. Also, it must have considered that unless this requirement were exacted of wives still dependent on their husbands, the effectiveness of the lien would be greatly impaired.

I should note here that I am construing the third paragraph of 19(a) to refer only to the so-called statutory right of a widow that is a one-third interest in real estate. I am assuming that the lien agreement does not cover the widow's homestead rights. I think a coerced waiver of those rights might raise quite different questions.

I am satisfied that the third paragraph of 19(a) does not offend against the equal protection provision of the federal constitution. Viewed in the light of the purposes of this classification of wives, the line between adhering and maritally separated wives serves the purpose of the classification. The classification is necessary to accomplish the full purpose of the lien. The two classes differentiated by the circumstances are not similarly situated for, as above pointed out, the adhering wife indirectly, if not directly, receives a benefit from the assistance which the separated wife does not.

One question remains to be considered:

Does the fact that no lien is required from recipients owning real property who receive assistance because they fall into the class of the blind, dependent children or general public assistance, work an unconstitutional classification in the light of the fact that old age recipients owning real property are required to give a lien?

Certainly there is no doubt that dependent children are differently situated as to the purpose of the lien condition than are the needy aged. In the case of a dependent child who happened to own real property, the County Board might have to wait many years before it could collect at his death for assistance rendered during a period most likely ended many years before his death.

The blind, by their very affliction, suffer from handicaps which in many cases extend over a long period of time — perhaps the whole or greater portion of their lives — and even though they may own and occupy their homes, they are in a condition which makes its appeal for the most generous treatment. These last mentioned two categories of recipients and the general public assistance classification, though less apparent, fall into a class not similarly situated as to the real property owning needy aged. These groups, therefore, in view of the purposes, administrative and substantive, to be served by classifications, form constitutionally differentiable classes.

I concur in the holding that the requirement of a lien does not offend against Article VI, Section 26, Paragraph 10 of our Constitution which prohibits special laws changing succession and inheritance. I also concur in the holding that it does not offend against Article VI, Section 31, of our Constitution which forbids a loan of the State's credit in aid of private individuals. This act deals with a broad public and social plan. Furthermore, the assistance is not a loan of credit. The fact that provision is made for future reimbursement of assistance payments up to the value of a house owned and occupied, less $300 assessment value, or $750 cash, does not make it such.