Section 204(a)(1) of the Social Security Act (Act) authorizes
the Secretary of the Department of Health, Education, and Welfare
to recoup erroneous overpayments made to a beneficiary under the
old-age, survivors', or disability insurance programs by decreasing
future payments to which the overpaid person is entitled. However,
§ 204(b) commands that
"there shall be no adjustment of payments to, or recovery by the
United States from, any person who is without fault if such
adjustment would defeat the purpose of this subchapter or would be
against equity and good conscience."
Under the Secretary's practice, after an
ex parte
determination is made under § 204(a) that an overpayment has been
made, and after the recipient is notified of that determination,
the recipient may file a written request seeking reconsideration of
the determination or asking the Secretary to waive recovery in
accordance with § 204(b). If, upon review of the papers, the
decision goes against the recipient, recoupment begins, and the
recipient is given an opportunity for an oral hearing only if he
thereafter continues to object to recoupment. The recipient may
seek subsequent administrative review, and finally may seek review
by a federal court under § 205(g) of the Act, which provides that
any person, after any final decision of the Secretary made after a
hearing to which he was a party, may obtain review of the decision
by instituting a civil action. Respondents, who had unsuccessfully
sought administrative relief from recoupment determinations,
instituted federal actions, alleging that, because they had not
been given adequate notice and an opportunity for an oral hearing
before recoupment began, the recoupment procedures violated both §
204 and the Due Process Clause of the Fifth Amendment. In each
action, class certification was sought, and, in one action, it was
requested that the class be nationwide. The respective District
Courts granted class certification, held that the Secretary's
recoupment procedures were unconstitutional, and ordered injunctive
relief. The Court of Appeals consolidated the cases on appeal and
upheld the certification of the classes. On the merits, the court,
without directly addressing respondents' statutory claims, held,
inter alia, that, when waiver of recoupment
Page 442 U. S. 683
was requested pursuant to § 204(b), the Due Process Clause
required that the recipient be given an oral hearing before
recoupment began, but that a prior hearing was not required in §
204(a) reconsideration cases if the dispute centered on a
computational error or a payment problem not demanding an
evaluation of credibility.
Held:
1. Recipients who file a written request for waiver under §
204(b) are entitled to the opportunity for a pre-recoupment oral
hearing, but those who merely request reconsideration under §
204(a) are not so entitled. Pp.
442 U. S.
692-697.
(a) On its face, § 204 requires that the Secretary make a
pre-recoupment waiver decision, and that the decision, like that
concerning the fact of the overpayment, be accurate. Pp.
442 U. S.
693-695.
(b) Neither § 204 nor the standards of the Due Process Clause
require pre-recoupment oral hearings as to requests under § 204(a)
for reconsideration as to whether overpayment occurred. The rare
instance in which a credibility dispute is relevant to a § 204(a)
claim is not sufficient to require the Secretary to grant a hearing
to the few requests that involve credibility. However, with respect
to § 204(b) waiver of the Secretary's right to recoup, the nature
of the statutory standards involving determinations of "fault" and
whether recoupment would be "against equity and good conscience"
makes a pre-recoupment oral hearing essential when a recipient
requests waiver. Pp.
442 U. S.
695-697.
2. Nothing in § 205(g) prohibits the pre-recoupment hearing
relief awarded in this case. Pp.
442 U. S.
697-706.
(a) Where a district court has jurisdiction over the claims of
the members of the class in accordance with the requirements set
out in § 205(g), it also has discretion under Fed.Rule Civ.Proc. 23
to certify a class action for the litigation of those claims. Pp.
442 U. S.
698-701.
(b) There was no abuse of discretion in certifying a nationwide
class. Pp.
442 U. S.
701-703.
(c) While the classes certified here exceed the bounds permitted
by § 205(g)'s "final decision" requirement because they include
persons who have not filed requests for reconsideration or waiver
in the past and will not do so in the future, nevertheless there is
no basis for altering the relief actually granted, as it did not
include those who do not meet such requirement. Pp.
442 U. S.
703-704.
(d) Injunctive relief may be awarded in a § 205(g) proceeding,
nothing in either the language or the legislative history of the
statute indicating that Congress intended to preclude injunctive
relief. Pp.
442 U. S.
704-706.
564 F.2d 1219, affirmed in part and reversed in part.
Page 442 U. S. 684
MR. JUSTICE BLACKMUN delivered the opinion of the Court.
Petitioner, the Secretary of the Department of Health,
Education, and Welfare (HEW), has determined that respondents,
beneficiaries under the Social Security Act, have been overpaid. He
seeks to recoup those overpayments by withholding future benefits
to which respondents would otherwise be entitled. Respondents, in
turn, have requested reconsideration or waiver of recoupment under
§ 204 of the Act, 42 U.S.C. § 404. The primary questions in this
case are whether petitioner must grant respondents the opportunity
for an oral hearing before recoupment begins, and whether
jurisdiction under § 205(g) of the Act, 42 U.S.C. § 405(g), permits
a federal district court to certify a nationwide class and grant
injunctive relief.
I
Section 204(a)(1) of the Social Security Act, 53 Stat. 1368, as
amended, 42 U.S.C. § 404(a)(1) , authorizes the recovery of
overpayments made to a beneficiary under the old-age, survivors',
or disability insurance programs administered by HEW. In
particular, it permits the Secretary to recoup
Page 442 U. S. 685
erroneous overpayments by decreasing future payments to which
the overpaid person is entitled.
Section 204(b), however, expressly limits the recoupment
authority conferred by § 204(a)(1). Section 204(b), as set forth in
42 U.S.C. § 404(b), commands that
"there shall be no adjustment of payments to, or recovery by the
United States from, any person who is without fault if such
adjustment or recovery would defeat the purpose of this subchapter
or would be against equity and good conscience. [
Footnote 1]"
The Secretary has undertaken to define the terms employed in §
204(b). Under his regulations, "without fault" means that the
recipient neither knew nor should have known that the overpayment
or the information on which it was based was incorrect. 20 CFR §
404.507 (1978). For example, a recipient who justifiably relied
upon erroneous information from
Page 442 U. S. 686
an official source within the Social Security Administration
would be "without fault." § 404.510.
The regulations say that to "defeat the purpose of the
subchapter" is to "deprive a person of income required for ordinary
and necessary living expenses." § 404.508(a). Those expenses are
defined to include, among other things, food, rent, and medical
bills. §§ 404.508(a)(1) and (2). Recoupment is "against equity and
good conscience" when the recipient,
"because of a notice that such payment would be made or by
reason of the incorrect payment, relinquished a valuable right . .
. or changed his position for the worse."
§ 404.509. An example of detrimental reliance that would be
sufficient is permitting private hospital insurance to lapse in the
mistaken expectation of receiving federal hospital benefits.
Ibid.
The Secretary's practice is to make an
ex parte
determination under § 204(a) that an overpayment has been made, to
notify the recipient of that determination, and then to shift to
the recipient the burden of either (i) seeking reconsideration to
contest the accuracy of that determination, or (ii) asking the
Secretary to forgive the debt and waive recovery in accordance with
§ 204(b). [
Footnote 2] If a
recipient files a written request for reconsideration or waiver,
recoupment is deferred pending action on that request. Social
Security Claims Manual §§ 5503.2(c), 5503.4(b) (Dec.1978) (Claims
Manual). The papers are sent to one of the seven regional offices
where the request is reviewed.
If the regional office decision goes against the recipient,
recoupment begins. The recipient's monthly benefits are reduced or
terminated [
Footnote 3] until
the overpayment has been recouped.
Page 442 U. S. 687
Only if the recipient continues to object is he given an
opportunity to present his story in person to someone with
authority to decide his case. That opportunity takes the form of an
on-the-record
de novo evidential hearing before an
independent hearing examiner. 20 CFR §§ 404.917, 404.931 (1978).
The recipient may seek subsequent review by the Appeals Council, §
404.945, and finally by a federal court. § 205(g) of the Act, 42
U.S.C. § 405(g). If it is decided that the Secretary's initial
determination was in error, the amounts wrongfully recouped are
repaid.
II
[
Footnote 4]
The Elliott Case
The Secretary overpaid the Hawaii respondents, [
Footnote 5] and notified them of his
determination to recoup the overpayments. After unsuccessful
attempts to obtain administrative relief, they brought suit in the
United States District Court for the District of Hawaii challenging
the legality of the Secretary's recoupment procedures. They alleged
that, because the
Page 442 U. S. 688
notice they received was inadequate and because they were not
given an opportunity for an oral hearing before recoupment began,
the recoupment procedures violated both § 204 of the Act and the
Fifth Amendment of the Constitution. They sought class
certification, and requested both declaratory and injunctive relief
that would require the Secretary to cease future recoupment until
such time as he provided the class with adequate notice and
opportunity for a hearing. App. 11-21.
The District Court certified a class of
"all social security old age and disability benefit recipients
resident in the State of Hawaii, who are being or will be subjected
to adjustment of their social security benefits pursuant to 42
U.S.C. §§ 404(a) and(b) without adequate prior notice of the
grounds for such action and without a prior hearing on disputed
issues relating to such actions."
Id. at 35. The court found jurisdiction under the
mandamus statute, 28 U.S.C. § 1361, and granted relief to
respondents. The court said that due process required that the
Secretary provide an opportunity for an informal oral hearing
before an independent decisionmaker prior to recoupment. In so
holding, the court relied on
Goldberg v. Kelly,
397 U. S. 254
(1970), which determined that, under the Due Process Clause, a
statutory right to welfare benefits could not be terminated without
prior notice and opportunity for an evidential hearing. The court
also held that the Constitution required that the initial
overpayment notice be modified to inform the recipient more fully
concerning recoupment procedures. Although the court did not
discuss respondents' statutory claim, it granted judgment for
respondents on both statutory and constitutional grounds and
ordered injunctive relief for the class.
Elliott v.
Weinberger, 371 F. Supp. 90 (1974).
The Buffington Case
Relying on annual earnings reports, the Secretary determined
that the individual respondents in
Buffington had been
Page 442 U. S. 689
overpaid for previous years. [
Footnote 6] After receiving notice, both named respondents
sought administrative relief, but were unable to halt recoupment.
They then brought suit in the United States District Court for the
Western District of Washington. They, too, alleged that the
Secretary's recoupment procedures were contrary to both § 204 and
the Due Process Clause of the Fifth Amendment. They requested
certification of a nationwide class, an injunction ordering
repayment of amounts unlawfully withheld, and declaratory and
mandamus relief that would require the Secretary to provide notice
and an opportunity for a hearing before recoupment began again.
App. 188-201.
The District Court certified a nationwide class composed of
"all individuals eligible for [old-age and survivors' benefits]
whose benefits have been or will be reduced or otherwise adjusted
without prior notice and opportunity for a hearing."
The court, however, excluded from the class residents of Hawaii
and the Eastern District of Pennsylvania, where suits raising
similar issues were known to have been brought.
Id. at
259.
See, e.g., Mattern v. Weinberger, 519 F.2d 150 (CA3
1975). As a precautionary measure, the court also excluded all
persons who had participated as plaintiffs or members of a
plaintiff class in litigation against the Secretary on similar
issues, if a decision on the merits previously had been rendered.
App. 259-260.
The court then granted summary judgment for the class. The court
found jurisdiction under the mandamus statute, 28 U.S.C. § 1361.
[
Footnote 7] It enjoined the
Secretary from ordering
Page 442 U. S. 690
recoupment without having provided recipients with a prior
opportunity for an informal hearing before an independent
decisionmaker. The court also ordered that the initial notice be
amended to provide more information about recoupment procedures.
Buffington v. Weinberger, Civ. No. 734-73C2 (WD Wash. Oct.
22, 1974). App. 262-265.
The Court of Appeals
The United States Court of Appeals for the Ninth Circuit
consolidated the two cases for disposition on appeal. In an
unreported opinion,
Elliott v. Weinberger, Nos. 74-1611
and 74-3118 (Oct. 1, 1975), App. to Pet. for Cert. 40A-84A, that
court found that the complaints presented substantial
constitutional questions, and so § 1361 mandamus jurisdiction was
proper. It upheld the certification of the classes under Fed.Rule
Civ.Proc. 23(b)(2), finding counsel was sufficiently skilled and
experienced to represent the class. It rejected the Secretary's
contention that a nationwide class should not have been certified.
It found nothing in Rule 23 indicating that such a class was
improper, and it believed as a practical matter that, because
respondents did not seek damages, no manageability problems were
present. It indicated that to require recipients to sue
individually would result in an unnecessary duplication of actions,
the evil that Rule 23 was designed to prevent. On the merits, the
Court of Appeals, without directly addressing respondents'
statutory claims, affirmed the holdings that the Secretary's
recoupment procedures were unconstitutional.
Subsequent to that decision, this Court, in
Mathews v.
Eldridge, 424 U. S. 319
(1976), held that the Due Process Clause does not require an oral
hearing prior to termination of Social Security disability
insurance benefits. We then granted petitions for writs of
certiorari filed by the Secretary
Page 442 U. S. 691
both in this case and in
Mattern, supra, vacated the
judgments below, and remanded the cases for further consideration
in light of
Eldridge. 425 U.S. 987 (1976).
On remand, the Court of Appeals adhered to the essential
features of its original decision.
Elliott v. Weinberger,
564 F.2d 1219 (1977). The court reaffirmed its holding that it had
jurisdiction under the mandamus statute. It noted that, while
Eldridge had indicated that named plaintiffs would be able
to assert jurisdiction based on § 205(g) under
Weinberger v.
Salfi, 422 U. S. 749,
422 U. S. 755,
764 (1975), there was some doubt as to whether that statute would
provide jurisdiction for a class action seeking injunctive relief,
and therefore the extraordinary remedy of mandamus could be
invoked. The court found that these actions were not foreclosed by
the jurisdictional limitations contained in § 205(h), because these
actions were brought to enforce constitutional rights, not "to
recover on any claim" for benefits.
On the merits, the court found
Eldridge
distinguishable. One of three grounds cited in support of this
conclusion is of particular relevance here. The court expressly
found that the Secretary's procedures for handling waivers created
an undue risk of erroneous deprivation. It said that, unlike the
medical decision at issue in
Eldridge, the grant of a
waiver frequently depended on credibility, which could not be
ascertained from the written submission on which the Secretary
relied. The court thus held that, when waiver was requested, the
Due Process Clause required that the recipient be given an oral
hearing before recoupment begins. The court said a prior hearing
was not required, however, in § 204(a) reconsideration cases if the
dispute was a routine one centering on a computational error or a
payment problem that did not demand an evaluation of credibility.
[
Footnote 8] The court
specified
Page 442 U. S. 692
six requirements that the oral hearing should meet, including
rights to receive notice, to submit evidence, to cross-examine
witnesses, to have counsel, to have an impartial hearing officer,
and to receive a written decision. The court did not require that a
transcript of the hearing be made. 564 F.2d at 1235.
The court also held that the notice must be "plainly and clearly
communicated."
Ibid. The court suggested that this could
be accomplished by including in the notice such matters as the
reason for overpayment, a statement of the right to request
reconsideration or waiver, the forms available for that purpose, a
description of the nature of reconsideration and waiver, and notice
of the right to a pre-recoupment hearing.
Id. at 1236.
The Secretary filed a petition for a writ of certiorari seeking
review of both the holding that the Due Process Clause required a
pre-recoupment oral hearing, and the determination that the class
was properly certified. The Secretary, however, did not request
review of the holding that his notice of recoupment was
constitutionally defective. Certiorari was granted.
Califano v.
Elliott, 439 U.S. 816 (1978).
III
A court presented with both statutory and constitutional grounds
to support the relief requested usually should pass on the
statutory claim before considering the constitutional question.
New York City Transit Authority v. Beazer, 440 U.
S. 568,
440 U. S.
582-583, and n. 22 (1979);
United States v.
CIO, 335 U. S. 106,
335 U. S. 110
(1948);
Ashwander v. TVA, 297 U.
S. 288,
297 U. S. 347
(1936) (concurring opinion). Due respect for the coordinate
branches of government, as well as a reluctance when conscious of
fallibility to speak with our utmost finality,
see Brown v.
Allen, 344 U. S. 443,
344 U. S. 540
(1953) (Jackson, J., concurring
Page 442 U. S. 693
in result), counsels against unnecessary constitutional
adjudication. And if "a construction of the statute is fairly
possible by which [a serious doubt of constitutionality] may be
avoided,"
Crowell v. Benson, 285 U. S.
22,
285 U. S. 62
(1932), a court should adopt that construction. In particular, this
Court has been willing to assume a congressional solicitude for
fair procedure, absent explicit statutory language to the contrary.
See Greene v. McElroy, 360 U. S. 474,
360 U. S.
507-508 (1959).
The District Courts and Court of Appeals in the cases now before
us gave these principles somewhat short shrift in declining to pass
expressly on respondents' contention that § 204 itself requires a
pre-recoupment oral hearing. We turn to the statute first, and find
that it fairly may be read to require a pre-recoupment decision by
the Secretary. With respect to § 204(a) reconsideration as to
whether overpayment occurred, we agree that the statute does not
require that the decision involve a prior oral hearing, and we
reject respondents' contention that the Constitution does so. With
respect to § 204(b) waiver of the Secretary's right to recoup,
however, because the nature of the statutory standards makes a
hearing essential, we find it unnecessary to determine whether the
Constitution would require a similar result.
A
On its face, § 204 requires that the Secretary make a
pre-recoupment waiver decision, and that the decision, like that
concerning the fact of the overpayment, be accurate. In the
imperative voice, [
Footnote 9]
it says "there shall be no adjustment of
Page 442 U. S. 694
payments to, or recovery by the United States from, any person"
who qualifies for waiver.
See Mattern v. Weinberger, 519
F.2d at 166, and n. 32. Echoing this requirement, § 204(a) says
that only "proper" adjustments or recoveries are to be made. The
implication is that a recoupment from a person qualifying under §
204(b) would not be "proper."
Insofar as § 204 is read to require a pre-recoupment decision,
the reading is in accord with the manner in which the Secretary
presently administers the statute. No recoupment is made until a
preliminary waiver or reconsideration decision has taken place,
either by default after the recipient has received proper notice,
or by review of a written request. Claims Manual §§ 5503.2(c),
5503.4(b). This interpretation is also reinforced by a comparison
with other sections of the
Page 442 U. S. 695
Social Security Act. Section 204 is strikingly unlike § 225,
[
Footnote 10] which
expressly permits suspension of disability benefits before
eligibility is finally decided.
See Richardson v. Wright,
405 U. S. 208
(1972). On the other hand, an analogy may be drawn between § 204
and § 303(a)(1), 42 U.S.C. § 503(a)(1), which this Court, in
California Human Resources Dept. v. Java, 402 U.
S. 121 (1971), interpreted to require payment of
unemployment benefits pending a final determination of eligibility.
[
Footnote 11] Neither § 204
nor § 303(a)(1) expressly addresses the timing of a hearing, but
both speak in mandatory terms and imply that the mandated act --
here, waiver of recoupment, there payment of benefits -- is to
precede other action.
B
The heart of the present dispute concerns not whether a
pre-recoupment decision should be made, but whether making the
decision by regional office review of the written waiver request is
sufficient to protect the recipient's right not to be subjected to
an improper recoupment.
In this regard, requests for reconsideration under § 204(a), as
to whether overpayment occurred, may be distinguished from requests
for waiver of the Secretary's right to recoup
Page 442 U. S. 696
under § 204(b). As the Courts of Appeals in this case and in
Mattern noted, requests under § 204(a) for reconsideration
involve relatively straightforward matters of computation for which
written review is ordinarily an adequate means to correct prior
mistakes.
Elliott, 564 F.2d at 1231;
Mattern v.
Mathews, 582 F.2d 248, 255-256 (CA3 1978). Many of the named
respondents were found to have been overpaid based on earnings
reports they themselves had submitted. But unlike the Court of
Appeals in this case, we do not think that the rare instance in
which a credibility dispute is relevant to a § 204(a) claim is
sufficient to require the Secretary to sift through all requests
for reconsideration and grant a hearing to the few that involve
credibility. The statute authorizes only "proper" recoupment, but
some leeway for practical administration must be allowed. Nor do
the standards of the Due Process Clause, more tolerant than the
strict language here in issue, require that pre-recoupment oral
hearings be afforded in § 204(a) cases. The nature of a due process
hearing is shaped by the "risk of error inherent in the
truthfinding process as applied to the generality of cases, not the
rare exceptions."
Mathews v. Eldridge, 424 U.S. at
424 U. S. 344.
It would be inconsistent with that principle to require a hearing
under § 204(a) when review of a beneficiary's written submission is
an adequate means of resolving all but a few § 204(a) disputes.
Mattern, 582 F.2d at 258.
By contrast, written review hardly seems sufficient to discharge
the Secretary's statutory duty to make an accurate determination of
waiver under § 204(b). Under that subsection, the Secretary must
assess the absence of "fault" and determine whether or not
recoupment would be "against equity and good conscience." These
standards do not apply under § 204(a). The Court previously has
noted that a "broad
fault' standard is inherently subject to
factual determination and adversarial input." Mitchell v. W. T.
Grant Co., 416 U. S. 600,
416 U. S. 617
(1974). As the Secretary's regulations
Page 442 U. S. 697
make clear, "fault" depends on an evaluation of "all pertinent
circumstances" including the recipient's "intelligence . . . and
physical and mental condition," as well as his good faith. 20 CFR §
404.507 (1978). We do not see how these can be evaluated absent
personal contact between the recipient and the person who decides
his case. Evaluating fault, like judging detrimental reliance,
usually requires an assessment of the recipient's credibility, and
written submissions are a particularly inappropriate way to
distinguish a genuine hard luck story from a fabricated tall tale.
See Goldberg v. Kelly, 397 U.S. at
397 U. S.
269.
The consequences of the injunctions entered by the District
Courts confirm the reasonableness of interpreting § 204(b) to
require a pre-recoupment oral hearing. In compliance with those
orders, the Secretary, beginning with calendar year 1977, has
granted what respondents term
"a short personal conference with an impartial employee of the
Social Security Administration, at which time the recipient
presents testimony and evidence and cross-examines witnesses, and
the administrative employee questions the recipient."
Brief for Respondents 46. Of the approximately 2,000 conferences
held between January, 1977, and October, 1978, 30 resulted in a
reversal of the Secretary's decision. Brief for Petitioner 46. This
rate of reversal confirms the view that, without an oral hearing,
the Secretary may misjudge a number of cases that he otherwise
would be able to assess properly, and that the hearing requirement
imposed by the Court of Appeals significantly furthers the
statutory goal that "there shall be no" recoupment when waiver is
appropriate. We therefore agree with the Court of Appeals that an
opportunity for a pre-recoupment oral hearing is required when a
recipient requests waiver under § 204(b).
IV
Without full consideration of the question, the Court of Appeals
expressed doubts about the availability of full relief
Page 442 U. S. 698
under § 205(g), the Act's judicial review provision. It
therefore invoked the extraordinary remedy of mandamus, for which
jurisdiction is provided by 28 U.S.C. § 1361. In this Court, the
Secretary contends that mandamus is not appropriate. And though he
concedes that jurisdiction over the claims of the named plaintiffs
was proper under § 205(g), he argues that class relief is
inappropriate under that section. The Secretary contends, in the
alternative, that, even if class relief were appropriate, a
nationwide class should not have been certified, and, because the
classes here include individuals who have not filed for
reconsideration or waiver, relief was awarded to persons over whom
the courts had no § 205(g) jurisdiction. The Secretary also
contends that injunctive relief cannot be awarded in a § 205(g)
suit. While we do not reject the Secretary's contentions entirely,
we find that nothing in § 205(g) prohibits the pre-recoupment
hearing relief awarded in this case, and so we do not reach the
question whether mandamus would otherwise be available. A The
Secretary argues that class relief is not available in connection
with any action brought under § 205(g), [
Footnote 12] and therefore that class relief should
not have been afforded in this case. In making this argument, the
Secretary relies on the language of § 205(g) which authorizes suit
by "[a]ny individual," speaks of judicial review of "any final
decision of the Secretary made after a hearing to which [the
plaintiff] was a party," and empowers district courts "to enter . .
. a judgment affirming, modifying, or reversing the decision of the
Secretary." This language, the Secretary says, indicates
Page 442 U. S. 699
that Congress contemplated a case-by-case adjudication of claims
under § 205(g) that is incompatible with class relief.
The Secretary contends that the decision in
Weinberger v.
Salfi, 422 U. S. 749
(1975), finding class relief inappropriate on the facts of that
case, and the legislative history of § 205(g) [
Footnote 13] support his argument in this
regard. And though the Secretary concedes that every Court of
Appeals that has considered this issue has concluded that class
relief is available under § 205(g), [
Footnote 14] he distinguishes those cases on the grounds
they evinced insufficient respect for the statute's plain language
and exaggerated the need for class relief in § 205(g) actions.
Restricted judicial review will not have a detrimental effect on
the administration of the Social Security Act, the Secretary says,
because he will appeal adverse decisions or abide them within the
jurisdiction of the courts rendering them. There is thus no need
for repetitious litigation in order to establish legal principles
beyond the confines of a particular case, and no need to afford
class relief in cases brought under § 205(g).
Section 205(g) contains no express limitation of class relief.
It prescribes that judicial review shall be by the usual type of
"civil action" brought routinely in district court in
Page 442 U. S. 700
connection with the array of civil litigation. Federal Rule
Civ.Proc. 1, in turn, provides that the Rules "govern the procedure
in the United States district courts in
all suits of a
civil nature." (Emphasis added.) Those Rules provide for class
actions of the type certified in this case. Fed.Rule Civ.Proc.
23(b)(2). In the absence of a direct expression by Congress of its
intent to depart from the usual course of trying "all suits of a
civil nature" under the Rules established for that purpose, class
relief is appropriate in civil actions brought in federal court,
including those seeking to overturn determinations of the
departments of the Executive Branch of the Government in cases
where judicial review of such determinations is authorized.
We do not find in § 205(g) the necessary clear expression of
congressional intent to exempt actions brought under that statute
from the operation of the Federal Rules of Civil Procedure. The
fact that the statute speaks in terms of an action brought by "any
individual" or that it contemplates case-by-case adjudication does
not indicate that the usual Rule providing for class actions is not
controlling, where under that Rule certification of a class action
otherwise is permissible. Indeed, a wide variety of federal
jurisdictional provisions speak in terms of individual plaintiffs,
but class relief has never been thought to be unavailable under
them.
See, e.g., 28 U.S.C. § 1343 (civil rights; provides
jurisdiction over civil actions "authorized by law to be commenced
by any person"); 28 U.S.C. § 1361 (mandamus; empowers federal
courts to compel certain Government officials and agencies "to
perform a duty owed to the plaintiff"); 29 U.S.C. § 1132(a)
(Employee Retirement Income Security Act of 1974; provides
jurisdiction over a civil action brought under the Act "by a
participant or beneficiary"). It is not unusual that § 205(g), like
these other jurisdictional statutes, speaks in terms of an
individual plaintiff, since the Rule 23 class action device was
designed to allow an exception to the usual rule that
litigation
Page 442 U. S. 701
is conducted by and on behalf of the individual named parties
only.
Moreover, class relief is consistent with the need for
case-by-case adjudication emphasized by the Secretary, at least so
long as the membership of the class is limited to those who meet
the requirements of § 205(g).
See Norton v. Mathews,
427 U. S. 524,
427 U. S.
535-537, and nn. 4-8 (1976) (STEVENS, J., dissenting).
Where the district court has jurisdiction over the claim of each
individual member of the class, Rule 23 provides a procedure by
which the court may exercise that jurisdiction over the various
individual claims in a single proceeding.
Finally, we note that class relief for claims such as those
presented by respondents in this case is peculiarly appropriate.
The issues involved are common to the class as a whole. They turn
on questions of law applicable in the same manner to each member of
the class. The ultimate question is whether a pre-recoupment
hearing is to be held, and each individual claim has little
monetary value. It is unlikely that differences in the factual
background of each claim will affect the outcome of the legal
issue. And the class action device saves the resources of both the
courts and the parties by permitting an issue potentially affecting
every social security beneficiary to be litigated in an economical
fashion under Rule 23.
We therefore agree that, where the district court has
jurisdiction over the claims of the members of the class in
accordance with the requirements set out in § 205(g), it also has
the discretion under Fed.Rule Civ.Proc. 23 to certify a class
action for the litigation of those claims.
The Secretary next argues that, assuming class actions in fact
may be maintained under § 205(g), it was error for the courts here
to sustain the nationwide class in the
Buffington
litigation. He argues that a nationwide class is unwise in that it
forecloses reasoned consideration of the same issues by
Page 442 U. S. 702
other federal courts and artificially increases the pressure on
the docket of this Court by endowing with national importance
issues that, if adjudicated in a narrower context, might not
require our immediate attention. Moreover, the Secretary, citing
Dayton Board of Education v. Brinkman, 433 U.
S. 406 (1977), as an example, argues that nationwide
class relief is inconsistent with the rule that injunctive relief
should be no more burdensome to the defendant than necessary to
provide complete relief to the plaintiffs.
Nothing in Rule 23, however, limits the geographical scope of a
class action that is brought in conformity with that Rule. Since
the class here was certified in accordance with Rule 23(b)(2), the
limitations on class size associated with Rule 23(b)(3) actions do
not apply directly. Nor is a nationwide class inconsistent with
principles of equity jurisprudence, since the scope of injunctive
relief is dictated by the extent of the violation established, not
by the geographical extent of the plaintiff class.
Dayton
Board, 433 U.S. at
433 U. S.
414-420. If a class action is otherwise proper, and if
jurisdiction lies over the claims of the members of the class, the
fact that the class is nationwide in scope does not necessarily
mean that the relief afforded the plaintiffs will be more
burdensome than necessary to redress the complaining parties.
We concede the force of the Secretary's contentions that
nationwide class actions may have a detrimental effect by
foreclosing adjudication by a number of different courts and
judges, and of increasing, in certain cases, the pressures on this
Court's docket. It often will be preferable to allow several courts
to pass on a given class claim in order to gain the benefit of
adjudication by different courts in different factual contexts. For
this reason, a federal court, when asked to certify a nationwide
class, should take care to ensure that nationwide relief is indeed
appropriate in the case before it, and that certification of such a
class would not improperly interfere with the litigation of similar
issues in other judicial districts. But we decline to adopt the
extreme position that
Page 442 U. S. 703
such a class may never be certified. The certification of a
nationwide class, like most issues arising under Rule 23, is
committed in the first instance to the discretion of the district
court. On the facts of this case, we cannot conclude that the
District Court in
Buffington abused that discretion,
especially in light of its sensitivity to ongoing litigation of the
same issue in other districts, and the determination that counsel
was adequate to represent the class.
C
The Secretary concedes that the named plaintiffs have satisfied
the requirements of § 205(g) jurisdiction. [
Footnote 15] He argues, however, that the
District Court erred in awarding relief to class members who have
been subjected to recoupment but who have not sought either
reconsideration of overpayment determinations or waiver of
recovery. The Secretary contends that these class members have
failed to obtain a "final decision" from the Secretary as required
by § 205(g), as construed in
Weinberger v. Salfi,
422 U. S. 749
(1975), and
Mathews v. Eldridge, 424 U.
S. 319 (1976).
Page 442 U. S. 704
The relief to which the Secretary objects in this Court is the
determination that he must afford class members an opportunity for
a pre-recoupment oral hearing. With respect to that relief, the
classes certified were plainly too broad. Both the
Elliott
and the
Buffington classes included persons who had not
filed requests for reconsideration or waiver in the past, and would
not do so in the future. [
Footnote 16] As to them, no "final decision" concerning
the right to a pre-recoupment hearing has been or will be made.
The Secretary errs, however, in suggesting that the lower courts
ordered that an opportunity for a pre-recoupment oral hearing be
afforded to those persons. The Court of Appeals aptly summarized
its holding, and that of the District Courts, as being that
recipients are entitled to the opportunity for a hearing "when they
claim a waiver." 564 F.2d at 1222. Because the procedure for
claiming waiver involves filing a written request with the
Secretary, we cannot agree that the Court of Appeals ordered this
relief for those who do not meet the jurisdictional prerequisites
of § 205(g). The Secretary's objection to the class definition is
well taken, but it provides no basis for altering the relief
actually granted in this case.
D
Finally, the Secretary contends that the District Courts erred
in granting injunctive relief. He argues that the grant of
jurisdiction found in § 205(g), which speaks only of the
Page 442 U. S. 705
power to enter a judgment "affirming, modifying, or reversing
the decision of the Secretary," does not encompass the equitable
power to direct that the statute be implemented through procedures
other than those authorized by the Secretary. Invoking the maxim
that equitable relief is appropriate only when a party has no
adequate remedy at law, he says that respondents would have an
adequate remedy if a court simply reversed the Secretary's decision
not to grant them pre-recoupment oral hearings. In the face of such
an order, he would be forced, he says, to suspend recoupment until
the recipient was afforded a hearing.
The Secretary's reading of the statute is too grudging. Absent
the clearest command to the contrary from Congress, federal courts
retain their equitable power to issue injunctions in suits over
which they have jurisdiction.
See Porter v. Warner Holding
Co., 328 U. S. 395,
328 U. S. 398
(1946);
Scripps-Howard Radio v. FCC, 316 U. S.
4,
316 U. S. 9-11
(1942). Nothing in either the language or the legislative history
[
Footnote 17] of § 205(g)
indicates that Congress intended to preclude injunctive relief in §
205(g) suits.
Injunctions can play an essential role in § 205(g) litigation.
Without the power to order a stay of recoupment pending decision, a
court, for all practical purposes, would be unable to "reverse" a
decision concerning pre-recoupment rights. In class actions,
injunctions may be necessary to protect the interests of absent
class members and to prevent repetitive litigation. While the grant
of injunctive relief makes the Secretary's duty to comply
enforceable by contempt order,
"[s]urely Congress did not intend § 205(g) to provide reluctant
federal officials with a means of delay in the remote eventuality
that they might not feel bound by the judgment of a federal
court."
Norton v. Mathews, 427 U.S. at
427 U. S. 535
(dissenting opinion). The conclusion that injunctive relief
Page 442 U. S. 706
is available under § 205(g) is supported both by our implicit
holding that a three-judge court was properly convened in
Jimenez v. Weinberger, 417 U. S. 628
(1974), and by the opinions of four Courts of Appeals. [
Footnote 18]
V
For these reasons, we hold that recipients who file a written
request for waiver under § 204(b) are entitled to the opportunity
for a pre-recoupment oral hearing; that those who merely request
reconsideration under § 204(a) are not so entitled; that class
certification is permissible under § 205(g); that the
Buffington court did not abuse its discretion in
certifying a nationwide class; that the class did exceed the bounds
permitted by § 205(g), but that the class members who received
relief all satisfied the § 205(g) requirement that a request for
waiver be filed; and that injunctive relief may be awarded in a §
205(g) proceeding.
The judgment of the Court of Appeals is therefore affirmed in
part and reversed in part.
It s so ordered.
MR. JUSTICE POWELL took no part in the consideration or decision
of this case.
[
Footnote 1]
In pertinent part, § 204(a), as set forth in 42 U.S.C. § 404(a),
provides:
"Whenever the Secretary finds that more or less than the correct
amount of payment has been made to any person under this
subchapter, proper adjustment or recovery shall be made, under
regulations prescribed by the Secretary, as follows:"
"(1) With respect to payment to a person [of] more than the
correct amount, the Secretary shall decrease any payment under this
subchapter to which such overpaid person is entitled, or shall
require such overpaid person or his estate to refund the amount in
excess of the correct amount, or shall decrease any payment under
this subchapter payable to his estate or to any other person on the
basis of the wages and self-employment income which were the basis
of the payments of such overpaid person, or shall apply any
combination of the foregoing."
Section 204(b), as set forth in 42 U.S.C. § 404(b), reads in
full:
"In any case in which more than the correct amount of payment
has been made, there shall be no adjustment of payments to, or
recovery by the United States from, any person who is without fault
if such adjustment or recovery would defeat the purpose of this
subchapter or would be against equity and good conscience."
[
Footnote 2]
Although, during 1977, the average overpayment to old-age and
survivors' insurance beneficiaries who were overpaid exceeded $500,
only 3.4% of those thus subject to recoupment sought waiver. Brief
for Petitioner 45, and n. 33. These figures do not include
disability beneficiaries.
Ibid. See also Elliott v.
Weinberger, 371 F.
Supp. 960, 967 (Haw.1974).
[
Footnote 3]
The Secretary has altered his procedures in several respects
since the initiation of this litigation, including: (i) rather than
terminate all benefits until recoupment is completed, the Secretary
now in nonfraud cases usually reduces the recipient's monthly
payments by only 25%,
see Claims Manual § 5515 (Jan.1979);
and (ii) recipients who report excessive earnings and are found to
have been overpaid now receive notice before, rather than after,
recoupment begins.
See Elliott v. Weinberger, 564 F.2d
1219, 1223 (CA9 1977). Neither party contends that these changes
moot this case.
[
Footnote 4]
Respondent Evelyn Elliott died in 1973. Counsel for the
respondent class moved to substitute Nancy Yamasaki as the
respondent named in the caption of the case in this Court, and that
motion was granted. 441 U.S. 959 (1979). In order to be consistent
with the heretofore published reports of these cases, we refer to
the decisions in the District Courts and Court of Appeals by their
original captions.
[
Footnote 5]
For respondents Isabelle Ortiz, Jordan Silva, and John Vaquilar,
the Secretary's determination was based on annual excess earnings
reports they filed. The Secretary determined that respondents
Raymond Gaines and Nancy Yamasaki were overpaid because of
administrative errors.
Elliott v. Weinberger, 371 F. Supp.
at 965-966.
[
Footnote 6]
Respondent Fannie Buffington received wife's benefits. Her
husband filed a report which revealed that his earnings had
exceeded the statutory limit. Respondent Frances Biner was asked to
file an earnings report for 1972 after a check with her employer
showed that her earnings exceeded those previously reported.
Elliott v. Weinberger, 564 F.2d at 1224-1225.
[
Footnote 7]
The District Court also asserted jurisdiction under the
Administrative Procedure Act, 5 U.S.C. § 701
et seq.
Thereafter, in
Califano v. Sanders, 430 U. S.
99 (1977), however, this Court held that that Act does
not provide a grant of federal court jurisdiction. Respondents do
not rely on that statute here.
[
Footnote 8]
The United States Court of Appeals for the Third Circuit on
remand reaffirmed its prior holding that the Due Process Clause
required an oral hearing prior to recoupment when waiver was
requested under § 204(b), but it said that no such hearing was ever
required when reconsideration was requested under § 204(a).
Mattern v. Mathews, 582 F.2d 248 (1978),
cert. pending
sub nom. Califano v. Mattern, No. 78-699.
[
Footnote 9]
A number of statutes authorizing the recovery of federal
payments make an exception for cases that are "against equity and
good conscience." Most are entirely permissive. They provide that
recovery "is not required,"
e.g., 10 U.S.C. §§ 1442, 1453
(serviceman's family annuity and survivors' benefit); or that an
agency "may waive" recovery if a proper showing is made, 5 U.S.C. §
4108(c) (civil service training expenses), 5 U.S.C. § 5922(b)(2)
(foreign station allowances); or that the agency head "shall make
such provision as he finds appropriate", 42 U.S.C. § 1383(b)
(supplemental security income); or simply that recovery "may be
waived," 10 U.S.C. § 2774(a) (military pay).
In contrast, § 204 is mandatory in form. It says "there shall be
no" recovery when waiver is proper. In this regard, it resembles
the "equity and good conscience" waiver provisions found in only
four other statutes: 38 U.S.C. § 3102(a) (veterans' benefits); 42
U.S.C. § 1395gg(c) (Medicare); 45 U.S.C. § 231i(c) (Railroad
Retirement Act of 1974); 45 U.S.C. § 352(d) (Railroad Unemployment
Insurance Act). Even those statutes are not identical to § 204 in
all material respects. While the use of the word "shall,"
particularly with reference to an equitable decision, does not
eliminate all discretion,
see Hecht Co. v. Boutles,
321 U. S. 321,
321 U. S.
327-331 (1944), it at least imposes on the Secretary a
duty to decide. And here, where the provision for recovery, §
204(a), and the provision for waiver, § 204(b), are phrased in
equally mandatory terms, it is reasonable to infer that, in this
particular statute, Congress did not intend to exalt recovery over
waiver.
The legislative history of § 204(b) indicates merely that
Congress intended to make recovery more equitable by authorizing
waiver.
See H.R.Rep. No. 728, 76th Cong., 1st Sess., 19
(1939); Hearings on Social Security before the House Committee on
Ways and Means, 76th Cong., 1st Sess., 2287-2288 (1939); S.Rep. No.
404, 89th Cong., 1st Sess., pt. 1, p. 256 (1965); S.Rep. No. 744,
90th Cong., 1st Sess., 257 (1967).
[
Footnote 10]
Section 225, 42 U.S. C § 425, provides:
"If the Secretary, on the basis of information obtained by or
submitted to him, believes that an individual entitled to
[disability benefits] . . . may have ceased to be under a
disability, the Secretary may suspend the payment of benefits . . .
until it is determined . . . whether or not such individual's
disability has ceased or until the Secretary believes that such
disability has not ceased."
[
Footnote 11]
Section 303(a) provides:
"The Secretary of Labor shall make no certification for payment
to any State unless he finds that the law of such State . . .
includes provision for -- "
"(1) Such methods of administration . . . as are found by the
Secretary of Labor to be reasonably calculated to insure full
payment of unemployment compensation when due."
[
Footnote 12]
In pertinent part, § 205(g), 42 U.S.C. § 405(g), provides:
"Any individual, after any final decision of the Secretary made
after a hearing to which he was a party . . . may obtain a review
of such decision by a civil action commenced within sixty days
after the mailing to him of notice of such decision or within such
further time as the Secretary may allow."
[
Footnote 13]
The Secretary, noting the sparseness of the legislative history
of the Social Security Act on this issue, points only to language
indicating that § 205(g) was intended to fill a gap in the original
Act. Congress indicated that it amended the Act because it did not
"specify what remedy, if any, is open to a claimant in the event
his claim to benefits is denied by the [Social Security] Board."
S.Rep. No. 734, 76th Cong., 1st Sess., 52 (1939). The reference in
this passage to "a claimant" and "his claim," the Secretary
believes, bolsters his argument that Congress intended only
case-by-case adjudication under § 205(g).
[
Footnote 14]
See, e.g., Caswell v. Califano, 583 F.2d 9, 14 n. 12
(CA1 1978);
Jones v. Califano, 576 F.2d 12, 21-22 (CA2
1978);
Liberty Alliance of the Blind v. Califano, 568 F.2d
333, 344 346 (CA3 1977);
Johnson v. Mathews, 539 F.2d
1111, 1125-1126 (CA8 1976);
Jimenez v. Weinberger, 523
F.2d 689, 694-697 (CA7 1975),
cert. denied sub nom. Mathews v.
Jimenez, 427 U.S. 912 (1976).
[
Footnote 15]
Brief for Petitioner 54-55. There are five named representatives
in the
Elliott class. The District Court found that the
notice sent to respondents by the Secretary did not advise them of
the need to file a written request, but that, even so, all had
personally been in touch with the local Social Security office
within 30 days and objected to recoupment. The court also found
that, after suit was initiated, John Vaquilar, Evelyn Elliott,
Raymond Gaines, and Nancy Yamasaki filed written requests for
reconsideration and waiver, and that these requests would not have
changed their status had filing been timely. 371 F. Supp. at 965,
and n. 8, 966, and n. 14. The Secretary says that files of the
Social Security Administration also show that Jordan Silva filed a
request for reconsideration and waiver, which was denied. Brief for
Petitioner 12 n. 16. Because Isabelle Ortiz never filed such a
request, the Secretary expresses some reservation as to whether she
has met the requirements of § 205(g). Brief for Petitioner 55.
There are two named representatives of the
Buffington
class. Fannie Buffington filed a request for reconsideration, and
Frances Biner filed a request for waiver. 564 F.2d at
1224-1225.
[
Footnote 16]
Respondents also sought and obtained a ruling that the Secretary
had not provided constitutionally adequate notice. The breadth of
the classes is caused in part by the inclusion of all those who had
not received adequate notice, a class far larger than the class of
those who, after receiving notice, filed a request for
reconsideration or waiver with the Secretary. The Secretary does
not challenge in this Court the Court of Appeals' ruling as to
notice, and none of the parties discuss whether a decision to send
notice could be a "final decision" within the meaning of § 205(g).
We therefore decline to consider whether the Court of Appeals had
jurisdiction under § 205(g) to grant notice relief to the class
members.
[
Footnote 17]
See S.Rep. No. 734, 76th Cong., 1st Sess., 52 (1939);
H.R.Rep. No. 728, 76th Cong., 1st Sess., 43 (1939).
[
Footnote 18]
See Caswell v. Califano, 583 F.2d at 14 n. 12;
In
re Letourneau, 559 F.2d 892, 894 (CA2 1977);
Johnson v.
Mathews, 539 F.2d at 1125-1126;
Jimenez v.
Weinberger, 523 F.2d at 694-697.
See generally Weinberger
v. Salfi, 422 U. S. 749,
422 U. S. 763
n. 8 (1975), noting this issue.