Allen v. Barnhart

F I L E D

United States Court of Appeals

Tenth Circuit

PUBLISH

FEB 4 2004

UNITED STATES COURT OF APPEALS

PATRICK FISHER

Clerk

TENTH CIRCUIT

THOMAS JOEL ALLEN,

Plaintiff - Appellant,

v. No. 03-7036

JO ANNE B. BARNHART,

Commissioner, Social Security

Administration,

Defendant - Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF OKLAHOMA

(D.C. No. 01-CV-609-S)

Submitted on the briefs:

Michael D. Clay, Tulsa, Oklahoma, for Plaintiff-Appellant.

Sheldon J. Sperling, United States Attorney; Cheryl Triplett, Assistant United

States Attorney; Tina M. Waddell, Regional Chief Counsel, Michael

McGaughran, Deputy Regional Chief Counsel, Michelle M. Montemayor,

Assistant Regional Counsel, Social Security Administration, Office of the General

Counsel, Region VI, Dallas, Texas, for Defendant-Appellee.

Before SEYMOUR , BRISCOE , and LUCERO , Circuit Judges.

LUCERO , Circuit Judge.

Plaintiff Thomas Joel Allen appeals from a district court order affirming

the denial of his application for disability benefits. The district court (adopting

the magistrate judge’s findings and recommendations) effectively conceded that

the administrative law judge (ALJ) erred in his analysis, but upheld the denial of

benefits nonetheless by relying upon certain analytical revisions offered on

judicial review. Affirming this post hoc effort to salvage the ALJ’s decision

would require us to overstep our institutional role and usurp essential functions

committed in the first instance to the administrative process. Because the ALJ’s

decision cannot stand on its own erroneous rationale, we reverse and remand the

case for further proceedings before the agency. 1

Upon receiving an application for disability benefits, an ALJ is required to

assess whether or not the claimant is disabled in a five-step, sequential analysis.

This analysis evaluates whether (1) the claimant is presently engaged in

substantial gainful activity, (2) the claimant has a medically severe impairment or

impairments, (3) the impairment is equivalent to one of the impairments listed in

1

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.

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the appendix of the relevant disability regulation, 2

(4) the impairment prevents the

claimant from performing his or her past work, and (5) the claimant possesses a

residual functional capability (RFC) to perform other work in the national

economy, considering his or her age, education, and work experience. 20 C.F.R.

§ 404.1520 (a)(4) (2003); see also , Trimiar v. Sullivan , 966 F.2d 1326, 1329 (10th

Cir. 1992); Williams v. Bowen , 844 F.2d 748, 750-52 (10 th Cir. 1988) .

In order to help evaluate the step five requirement, whether or not there are

sufficient jobs in the economy that the claimant can perform given his or her age,

education, and work experience, the Social Security Administration has created

Medical-Vocational Guidelines, also known as “the grids.” See 20 C.F.R. §

404.1567; id. pt. 404, subpt. P, app. 2; Trimiar , 966 F.2d at 1332. Five degrees of

residual functional capacity are outlined in the grids by general exertional level –

sedentary, light, medium, heavy, and very heavy exertion. 20 C.F.R. § 404.1569a;

Trimiar , 966 F.2d at 1332 n.22. Residual functional capacity reflects “the

maximum degree to which the individual retains the capacity for sustained

performance of the physical-mental requirements of jobs.” 20 C.F.R. pt. 404,

subpt. P, app. 2, § 200.00(c). If the ALJ finds that a claimant’s exertional

2

The appendix lists impairments by body system (i.e., musculoskeletal,

cardiovascular, digestive, neurological, etc.). 20 C.F.R. pt. 404, subpt. P, app. 1.

If a claimant has a listed impairment that lasts the duration required in the

appendix, the claimant is found disabled, without regard to his or her age,

education, and work experience. 20 C.F.R. § 404.1520 (a)(4)(iii) and (5)(d).

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capacity, education, age, and skills fit precisely within the criteria of a particular

grid level, the ALJ may conclude the claimant is not disabled. Haddock v. Apfel ,

196 F.3d 1084, 1088 (10 th Cir. 1999).

Based on medical records indicating a history of chronic back problems, the

ALJ determined that Allen’s severe spinal impairment precluded his return to past

relevant work. Finding that his impairment did not foreclose all significant

opportunities for gainful employment, however, the ALJ denied disability benefits

at step five of the controlling analytical sequence, erroneously concluding that

Allen was not disabled because he retained the capacity to perform light work.

The difficulty with the ALJ’s decision stems from his failure to link his findings

regarding Allen’s RFC to his conclusion regarding Allen’s vocational

opportunities, resulting in a flawed assessment of Allen’s disability status.

While the ALJ found Allen capable of light work, this finding was qualified

by many additional physical restrictions including: limits on climbing stairs,

ramps, ladders, scaffolds or ropes; on bending, stooping, crawling or crouching;

on operating controls either overhead or with foot pedals; and on working in

unprotected heights or near dangerous moving machinery. Further qualifying

Allen’s RFC with significant nonexertional restrictions, the ALJ included limits

on more than simple or moderately detailed work instructions; on more than

superficial interaction with co-workers and supervisors; and on more than

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occasional interaction, in person or by phone, with the public. After

acknowledging that this restrictive RFC precluded Allen’s return to his past work,

the ALJ’s decision splintered into two distinct rationales–one relying upon an

erroneous application of the Medical-Vocational Guidelines and the other relying

upon a flawed specification of jobs available–both of which are plainly at odds

with the RFC findings.

During Allen’s disability hearing, the ALJ questioned a vocational expert

(VE) fairly extensively regarding other jobs Allen could perform, yet his findings

do not comport with these inquiries. Specifically, the ALJ asked the VE to list

jobs that a hypothetical individual with Allen’s RFC could perform. In response,

the VE suggested surveillance systems monitor. Then the ALJ proposed another

hypothetical matching Allen’s RFC, but without the public contact restrictions.

To this latter question, the VE replied by listing jobs such as toll booth operator

and self-service cafeteria worker.

“[B]ased upon the claimant’s age, education, work experience, and the RFC

described . . . ,” the ALJ found that “the ‘Medical-Vocational Guidelines’

(commonly know as the ‘Grids’) . . .would apply and direct a conclusion that the

claimant is ‘not disabled.’” Aplt. App., Vol. II at 22-23. To reach this

conclusion, the ALJ ignored the many additional physical and mental restrictions

that he found qualified Allen’s RFC and simply applied the grids for light

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work–contrary to the pertinent regulations and a large body of circuit precedent

precluding use of the grids unless the claimant’s RFC precisely matches the RFC

specified for the grid relied upon. See 20 C.F.R. §§ 404.1569, 404.1569a; id. pt.

404, subpt. P, app. 2, § 200.00(e); Haddock , 196 F.3d at 1088 (“When a

claimant’s exertional level, age, education, and skill level (i.e., work experience)

fit precisely within the criteria of a grid rule, an ALJ may base a determination of

nondisability conclusively on the grids.”); Channel v. Heckler , 747 F.2d 577,

581-82 (10 th Cir. 1984) (citing case law recognizing that an ALJ’s conclusive

reliance on grids is erroneous when the ALJ fails to make findings regarding non-

exertional impairments). This error is so plain that the grid rationale set out in

the ALJ’s dispositional findings is not even a subject of discussion in the

Appellee’s briefs.

The district court defended the ALJ’s decision as a determination based not

on the grids but on the VE’s identification of specific jobs in response to the

ALJ’s inquiries incorporating Allen’s RFC and associated limitations. This

facially more creditable rationale for the decision is based on statements made in

the body of the ALJ’s decision, yet this rationale was not carried forward into the

final dispositional section. In any event, this reconstructed version of the ALJ’s

decision ultimately founders on the same RFC complications that undercut the

grid rationale. The ALJ recited that the VE had “identified jobs in significant

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numbers . . . within the limits set by [Allen’s] RFC,” and then named

“surveillance monitor,” “toll booth operator,” and “self-service (cafeteria)

cashier.” Aplt. App., Vol. II at 21. Again, the problem is that the VE had

specifically omitted the latter two obviously public occupations when the ALJ

limited his query to Allen’s precise RFC, which included limitations on public

interaction. See id . at 19-20, 379-80.

Painted into a corner by these undeniable errors in the ALJ’s decision, the

Appellee makes the only argument left: that the denial of benefits is supportable

on the basis that the remaining (one hundred statewide) surveillance-monitor jobs

identified by the VE constitute “work which exists in significant numbers” under

42 U.S.C. § 423(d)(2)(A). See Trimiar , 966 F.2d at 1330 . Attempting to bolster

this position, the Appellee cites a few cases in which courts affirmed an ALJ’s

judgment that a small number of statewide jobs satisfied the “significant

numbers” condition set out in the statute. None of these cases involved a number

as low as one hundred. Overriding the bare numbers is the procedural fact that

these cases involved court review of a finding of numerical significance made by

the ALJ ; they were not deciding in the first instance that a particular number was

significant under the circumstances. This court has made it clear that judicial

line-drawing in this context is inappropriate, that the issue of numerical

significance entails many fact-specific considerations requiring individualized

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evaluation, and, most importantly, that the evaluation “should ultimately be left to

the ALJ’s common sense in weighing the statutory language as applied to a

particular claimant’s factual situation.” Trimiar , 966 F.2d at 1330 (quotation

omitted). Such a determination is precisely what is presently lacking.

Because the ALJ erroneously relied upon 800 publicly interactive jobs,

despite the direct conflict with his RFC findings, he never had occasion to decide

if the one hundred surveillance jobs alone constituted a significant number under

the statute. Thus, he did not give explicit consideration to the factors this court

has recognized should guide the ALJ’s commonsense judgment, such as “the level

of [Allen’s] disability; the reliability of the [VE’s] testimony; the distance [Allen]

is capable of travelling to engage in the assigned work; the isolated nature of the

jobs; [and] the types and availability of such work.” Trimiar , 966 F.2d at 1330

(quotation omitted). Faced with this problem, the Appellee punts, saying that

“[e]ven without these two [public] jobs, the ALJ found that Claimant was not

disabled because a significant number of jobs existed.” Aplee. Br. at 8. To the

extent the Appellee is asserting that the ALJ alternatively found the one hundred

surveillance jobs alone sufficient to satisfy the numerical-significance

requirement, the statement is wrong; to the extent the Appellee is not making that

assertion, the statement is meaningless.

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We should emphasize that Trimiar ’s insistence on an antecedent exercise of

judgment by the ALJ is not novel. On the contrary, it is consistent with, if not

compelled by, our broader recognition that as a court acting within the confines of

its administrative review authority, we are empowered only to “review the ALJ’s

decision for substantial evidence” and, accordingly, “we are not in a position to

draw factual conclusions on behalf of the ALJ.” Drapeau v. Massanari , 255 F.3d

1211, 1214 (10 th Cir. 2001) (quotation omitted). Unless we could hold as a

matter of law –and thus not fact, which is beyond our purview–that one hundred is

so large a number as to conclusively establish the requisite numerical

significance, Drapeau precludes affirmance here just as Trimiar does.

This brings us to the Appellee’s final line of defense–the principle of

harmless error. We have generally recognized the applicability of this principle

in the administrative review setting. See St. Anthony Hosp. v. United States

Dep’t of Health & Human Servs. , 309 F.3d 680, 691 (10 th Cir. 2002) (following

All Indian Pueblo Council v. United States , 975 F.2d 1437, 1443 (10 th Cir.

1992)). Further, we have specifically applied it in social security disability cases,

though not always by name and without settling on a definitive characterization of

its precise contours and range of application in this somewhat unique,

nonadversarial setting. For example, this court has held that certain technical

errors were “minor enough not to undermine confidence in the determination of

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th[e] case,” Gay v. Sullivan , 986 F.2d 1336, 1341 n.3 (10 th Cir. 1993); Diaz v.

Secretary of Health & Human Servs. , 898 F.2d 774, 777 (10 th Cir. 1990), and that

an “ALJ’s conduct, although improper, d[id] not require reversal” because the

procedural impropriety involved had not “altered the evidence before the ALJ,”

Glass v. Shalala , 43 F.3d 1392, 1396-97 (10 th Cir. 1994). For present purposes,

one significant thing this heterogeneous group of cases has in common is that in

none of them did this court hold an ALJ’s failure to make a dispositive finding of

fact harmless on the basis that the missing fact was clearly established in the

record, which is the only possible basis for invoking the principle in this case.

Two considerations counsel a cautious, if not skeptical, reception to this

idea. First, if too liberally embraced, it could obscure the important institutional

boundary preserved by Drapeau ’s admonition that courts avoid usurping the

administrative tribunal’s responsibility to find the facts. Second, to the extent

a harmless-error determination rests on legal or evidentiary matters not considered

by the ALJ, it risks violating the general rule against post hoc justification of

administrative action recognized in SEC v. Chenery Corp. , 318 U.S. 80 (1943)

and its progeny.

With these caveats, it nevertheless may be appropriate to supply a missing

dispositive finding under the rubric of harmless error in the right exceptional

circumstance, i.e., where, based on material the ALJ did at least consider (just not

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properly), we could confidently say that no reasonable administrative factfinder,

following the correct analysis, could have resolved the factual matter in any other

way. Such an approach might have been open to us here had the number of

available jobs identified by the VE not been one hundred but considerably greater.

In Trimiar , we explicitly addressed an ALJ’s finding of numerical significance

with respect to an occupation reflecting 650-900 statewide jobs, indicating that

such a number was small enough to put the issue in a gray area requiring the ALJ

to address it and us to review what he or she decided. See Trimiar , 966 F.2d at

1330. As the number in this case is even lower, excusing the ALJ’s failure to

assess it in connection with the Trimiar factors would be an improper exercise in

judicial factfinding rather than a proper application of harmless-error principles.

In sum, the ALJ’s decision contains two critical errors: use of the grids

contrary to RFC findings, and specification of available jobs contrary to VE

testimony based on the same RFC findings. Any attempt to save the decision, by

finding that the one job Allen concededly can do constitutes significant work,

usurps the ALJ’s primary responsibility to determine that question in light of

the various case-specific considerations outlined in Trimiar .

The judgment of the district court is REVERSED and the cause is

REMANDED with instructions to remand, in turn, to the Commissioner for

further proceedings consistent with this opinion.

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