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Allen v. Barnhart

August 8, 2005


On Appeal from the United States District Court for the District of New Jersey. (D.C. Civil No. 02-cv-02597). District Judge: Hon. Dennis M. Cavanaugh.

The opinion of the court was delivered by: Rendell, Circuit Judge


Argued March 8, 2005

Before: NYGAARD, McKEE, and RENDELL, Circuit Judges


William Allen complains of the determination of the Social Security Administration ("Agency") that Allen is capable of substantial gainful employment. Allen was awarded social security benefits in 1994 based on his manicdepressive disorder, and schizoid condition. These benefits were discontinued in 1998 based on the Agency's determination that Allen's condition had improved. Allen appealed this decision and the Appeals Council remanded the decision, specifically requiring, among other things, that "if warranted by the expanded record" the Administrative Law Judge ("ALJ") "obtain evidence from a vocational expert to clarify the effect of the assessed limitations on the claimant's occupational base..." Allen urges that the ruling of the ALJ on remand denying his continued benefits was not supported by substantial evidence because the ALJ relied on the medical-vocational grids notwithstanding the fact that the impairment from which he suffers was not exertional. Allen urges that the Commissioner was required to come forward with testimony from a vocational expert regarding the occupational base in light of the nature of Allen's limitations.

The District Court affirmed the determination of the Agency that Allen's condition had improved, reasoning that "...because the findings and opinions of Plaintiff's treating, examining and non-examining sources confirm that Plaintiff's condition improved to where he could perform substantial gainful activity, Plaintiff failed to show that his medical impairment resulted in functional limitations that precluded all successful gainful activity." The District Court also held that reliance on the grids, as well as on Social Security Rulings, was sufficient in order for the Commissioner to satisfy its burden of proof and the ALJ had discretion whether or not to call a vocational expert. While we agree generally with the District Court 's ruling that the Commissioner can satisfy his burden in this manner, we disagree with the way in which the ALJ applied the Social Security Ruling at issue here, and we will reverse the District Court 's Order and remand for it to refer the matter to the Agency for further findings.*fn1

We review the Agency's factual findings only to determine whether the administrative record contains substantial evidence supporting the findings. See 42 U.S.C. § 405(g); Sykes v. Apfel, 228 F.3d 259, 262 (3d Cir. 2000). We exercise plenary review over all legal issues. See Id.


Allen's grant of benefits came up for periodic continuing disability review in October 1997, pursuant to Sections 216(i) and 223 of the Social Security Act, 42 U.S.C. §§ 416(i) and 423, at which time the issues were whether his medical condition had improved, and whether he had the ability to obtain gainful employment. See 20 C.F.R. § 416.994 (2005).

When benefits were originally awarded to him in 1994, Allen had completed a Functional Assessment Questionnaire, in which he indicated that he lived with his mother, needed help taking care of his personal needs, and did not prepare his own meals. He indicated that on some days he did not get out of bed. His mother did the shopping, and he barely left the house. He stated, "I think I'm God, so I waste money." Further, with respect to his interests and recreational activities, he noted that all he did was to "sleep and fantasize," and that he didn't visit others because "I don't trust humans." Asked to elaborate on his medical condition, he wrote: "Sometimes I think the world is coming to an end, that I'm God, that I'm the devil and that I'm the richest man in the world. I also think the TV is talking to me."

At that time, Dr. Edward Tabbanor opined that Allen had a 15-year history of emotional difficulties, and that although he was on medication and "is pleased with his present adjustment . . . he is functioning marginally and is involved in no organized activities. He should be encouraged to seek the services of vocational rehabilitation." Dr. Tabbanor concluded that Allen was "not a good candidate" for gainful employment.

The Agency terminated Allen's benefits in January 1998, based on its own determination that, as of November 1997, he had the ability to engage in substantial gainful employment. Reconsideration of the denial was denied, but Allen then requested a hearing before an ALJ, which was held in May 1999, at which he appeared and testified.

The ALJ considered the applicable standard, namely, that he needed to determine whether there had been a decrease in the medical severity based on changes in symptoms, signs, and/or laboratory findings manifested by the impairment, noting that the medical improvement must be related to ability to work. If there was a medical improvement and an increase in the individual's functional capacity to do basic work activities, the ALJ noted, he would determine that medical improvement related to the ability to do work has occurred. 20 C.F.R. § 1594(b)(3).

The ALJ cited extensive improvement in Allen's condition, giving appropriate details as to specific areas of improvement, and describing the 1997 findings of two physicians, Edward Tabbanor and Luis Zeiguer. The ALJ concluded, in summary fashion, that based on the evidence, "the claimant has the residual functional capacity to perform substantial gainful activity, including his past relevant work as a salesperson." The ALJ then concluded that the benefits had been correctly terminated.

On appeal, the Appeals Council took the ALJ to task for failing to include (1) an evaluation of the severity of Allen's mental impairment or effects pursuant to 20 C.F.R. § 404.1520(a); (2) an evaluation of the credibility of Allen's subjective complaints as required by Social Security Ruling 96-7(p) and 20 C.F.R. § 404.1529; and (3) an indication of Allen's exertional or non-exertional limitations. The Appeals Council stated that it was unable to determine "how the decision has been reached that the claimant retains the residual functional capacity to perform his past relevant work."

The Appeals Council then remanded Allen's case to the ALJ, instructing the ALJ to further evaluate the claimant's subjective complaints, evaluate his mental impairment in accordance with the technique described in 20 C.F.R. § 404.1520a(c), consider the maximum residual functional capacity, and "if warranted by the expanded record, obtain evidence from a vocational expert to clarify the effect of the assessed limitations on the claimant's occupational base (Social Security Ruling 85-15)." The Appeals Council included the following in concluding its directive: "The hypothetical questions should reflect the specific category/limitations established by the record as a whole. The Administrative Law Judge will ask the vocational expert to identify examples of appropriate jobs and to state the incidence of such jobs in the national economy. (20 C.F.R. § 404.1566)."

A hearing was held on August 13, 2001, at which Allen appeared and testified. Allen testified that he had completed college and had taken some graduate courses. He had held a few jobs, as a draftsman, a salesperson, and a telemarketer, but was fired from every job within three months. He was on medication, and took public transportation to get to the doctor's office and to the hearing. He testified that he had a "short fuse" and sometimes co-workers would make him angry. Working in a workplace setting was difficult when he experienced manic episodes and he missed work because of lack of sleep.

The record before the ALJ included assessments from three doctors. Dr. Robles, who had treated Allen in 1999 at the Newark Beth Israel Medical Center, noted that Allen's bipolar disorder made him "likely to decompensate if under pressure or with large groups of people." Dr. Tabbanor, who had rendered an opinion when Allen first qualified for benefits, opined that Allen was "compliant with medical supervision and lithium medication with fair results. He presents as a fair candidate for resumption of gainful employment." Dr. Zeiguer noted that Allen explained that he has not sustained full-time employment because "under stress of employment production demands he tends to develop paranoid ideation and gets into conflicts." The opinion then went on to note the potential for stress-related decompensation, although experiencing very limited psychiatric hospitalization and concluded that Allen "showed good enough concentration for simple repetitive chores."

The ALJ issued his opinion on November 29, 2001, referencing the opinions of Drs. Tabbanor and Zeiguer, and noted that the Beth Israel psychiatric records indicated that "the claimant was doing well and his condition had stabilized. The ALJ did not refer to the "decompensation" note contained in Dr. Robles' report. The ALJ found Allen's symptoms to be not fully supported by objective medical evidence alone, and his allegations that he was unable to work after November 1, 1997 because of his mental impairments to be not fully credible.

The ALJ then noted that Allen's impairment was "severe," but not of listing severity. He then followed the dictates of 20 C.F.R. §§ 404.1520(a) and 416.920(a), examining Allen's Residual Functional Capacity, noting that Allen had "mild" limitations in his activities of daily living and concentration, "moderate" limitations of social functioning (which decrease when he takes his medication), and that he had not experienced episodes of decompensation.

The ALJ concluded that Allen had made medical improvement in the symptoms of bipolar disorder. This was based primarily upon Dr. Tabbanor's opinion in 1997 (as compared to his first opinion, in 1994). Drawing on Dr. Tabbanor's opinion that "claimant was capable of gainful employment," and Dr. Zeiguer's opinion that claimant was "capable of performing simple chores," the ALJ concluded that Allen had the Residual Functional Capacity for simple routine repetitive work at all exertional levels. However, he was not capable of his past ...

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