Petition — Blum v. Holley

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i OCT 11 1979

In The tk

Supreme Court of the United States 18, CLERK

OCTOBER TERM, 1979

no. 79-593

BARBARA BLUM, as Commissioner of the New York State

Department of S« “al Services,

Petitioner,

vs.

GAYLE McQUOID HOLLEY, individually and on behalf of

JAMES McQUOID, NORMAN McQUOID, THOMAS

McQUOID, DOUGLAS McQUOID, MICHAEL McQUOID, and

ADELAINE McQUOID, her minor children,

Respondents,

and

JAMES REED, as Commissioner of the Monroe County

Department of Social Services,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

ROBERT ABRAMS

Attorney General of the ‘

State of New York :

Attorney for Petitioner

The Capitol

Albany, New York 12224

Telephone (518) 474-7178

SHIRLEY ADELSON SIEGEL

Solicitor General,

State of New York

ALAN W. RUBENSTEIN

Principal Attorney,

State of New York

of Counsel

Daily Record Corporation Spaulding Law Printing

Rochester, New York (5305) Syracuse, New York

TABLE OF CONTENTS

Page

ik ik wha Go oa bs cp hcks ed a2 ut

SII She ke ew dw alb's bis‘ebib.c e's 2

eR LOUNE TE or Ok 2

Ce Pe he is eT ie eioikis coche 2

Constitutional Provisions and Statutes Involved. ...... 2

Statenmmnt ofthe Cant. ss ioe ee acess chal. 3

Decision and Order of the District Court After Remand . 4

Opinion of the Court uf Appeals ................... 4

Reasons for Granting the Writ .................05- 6

oo RG ee CU a 13

APPENDICES

APPENDIX A (Decision and Order of the District Court) A-1

APPENDIX B (Opinion of the Court of Appeals)....... A-16

APPENDIX C (Judgment of the Court of Appeals) ..... A-34

APPENDIX D (Constitutional Provisions and Statutes

DUN 0s OPC ES ECCS Ree. A-36

1)

TABLE OF AUTHORITIES

Cases Page

Albany Welfare Rights Organization Day Care Center,

Inc. v Schreck, 463 F2d 620 (2d Cir 1972), cert den 410

SEN cs. Galea Meee Oe ok Wawa ee wat

Bernstein v Towa, 43 NY2d 437, 373 NE2d 238 (18°77) .... 7

Beaudoin v Toia, 45 NY2d 343, 380 NE 2d 246 (1978) . . 4,8, 9, 12

County of Marin v. Martin, Cal App 3d, 1, 117 Cal

SS CSE Ns EIS Gig eR 12

County of Contra Costa of Social Welfare Board, 18 Cal

PUN RE Co a bois PES oe EEE Maiti Rew. 12

Edleman v Jordan, 415 US 651 (1974)... ............ 2,4, 6, 10

Lake Country Estates, Inc v Tahoe Regional Planning

Agency, __. US__., 99 SCt 1171 (1979)... .....:. 5, 10

Lee v Smith, 43 NY2d 453, 373 NE2d 247 (1977) ....... 7

Lindsay v Wyman, 372 F Supp 1360 (SDNY, 1974), affd

sub nom Beame v Lavine, 419 US 806 (1974). ........ 8

Mackey v Stanton, 586 F2d 1126 (7th Cir, 1978) cert den,

sub nom, Stanton v. Mackey, US , No 78-1733

mE, ATO Skis Oa he aay ORR Re ko ee Cn ee 4,5

Memorial Hospital v Mari-Copa County, 415 US 250

SO is oe bc Rx ak 0 ek Ce oe ilk ee ee Pees 12

Monnell v New York City Department of Social Services,

MTR ROTOR ios a's 25 So BRR oe hes ee 6

Mt. Healthy City Board of Education v Doyle, 429 US 274

UM a ak yn. ssp te Waid uote p Send aks wed ona ara Oe 2, 4,6, 9, 10

Plumas County Board of Supervisors, et al. v Califano,

594 F2d 756 (9th Cir, 1979), cert pending, Docket No.

Ss Sh ed obo ce k os ee oie Rae ee as ity 12

tii

Page

State Board of Social Welfare v City of Newburgh, 28

Misc 2d 539, 220 NYS2d 54 (Sup Ct, Orange Co, 1961). . 8

Toia v Regan, 54 AD2d 46, 387 NYS2d 309 (4th Dept,

1976), affd 40 NY2d 837, 356 NE2d 276 (1976), app

aren SEU BO a ak wie v6 ook epee os 6 0's 7,9,10 .

Tucker v Towa, 43 NY2d 1, 371 NE2d 449 (1977)........ 7

Constitutional Provisions

Eleventh Amendment to the Constitution of the United

a ers ah ates Ce oe en ges kos ob ees 2,4,5,9, 10,11

Article XVII, Section 1 of the Constitution of the State of

PO UN SF ee nbd cee ee eee ae Chee 2,7

Statutes of the United States

Mio A os i iseuece ass ioe

42 United States Code §602(aM1X3) .............20.8. 2,11

SE Ae Sos CRs wks OU Sek OR ENR 3, 6

Social Security Act §402(aX 13)... 22.52... 0.000008. 11

Statutes of the State of New York

INTE oes See Caces cewek cee duen 7

Social Services Law §20.........0.c0cceeseeueees se

Social Services Law §20(8fa).............02 cece eee 7

Social Services Law §20(3\f).............5. eeu: 7

Social Services Law §22(9Mb)..............0 eee eee 9

Se rr nee 7

Soceeel RSVR OG 55k eee ee ee awe 6,7

w

j

SCRE SOUR CO GUN wooo scan n cng vp sia pec wne s

Social Services Law §65 ........... cesses eeeeeee

Social Gervaced Ghee 6X a. a er ee

Sees CWSU I ek i te SN eke

Social Services Law §92(1MaXc) ...........2 22. ee eee

Social Services Law §93(3X6).. 2.2... ee ee eee

Social Services Law §131-k . 2... ee cee wees

SoeteE SOP wiene RMT SIGS ee Se

Social Services Law §153(1MaXd)... 2.2.2... eee eee 10

me woe vetod © NN BJ

Miscellaneous

es sok coe Oa ow eae es 3

In The

Supreme Court of the United States

OCTOBER TERM, 1979

NO.

BARBARA BLUM, as Commissioner of the New York State

Department of Social Services,

Petitioner,

vs.

GAYLE McQUOID HOLLEY, individually and on behalf of

JAMES McQUOID, NORMAN McQUOID, THOMAS

McQUOID, DOUGLAS McQUOID, MICHAEL McQUOID, and

ADELAINE McQUOID, her minor children,

Respondents,

and

JAMES REED, as Commissioner of the Monroe County

Department of Social Services,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS.

FOR THE SECOND CIRCUIT

Petitioner Blum’, in this cause in which plaintiff has been

awarded welfare payments retroactively against a county social

services commissioner, prays that a writ of certiorari be issued

to review the judgment of the United States Court of Appeals for

the Second Circuit, entered in this case on July 13, 1979 and

bearing such date, which affirmed the judgment of the United

States District Court for the Western District of New York.

*The action had been commenced against Abe Lavine, then State Com-

missioner of Social Services. He has been succeeded in office and function by

Barbara Blum (Rule 48{3].)

Opinions Below

The decision and order of the District Court (JOHN T.

CURTIN, DJ), dated February 1, 1979, which inter alia directed

“The County defendant * * * to reimburse the plaintiff for public

assistance benefits withheld * * *” and rejected plaintiff's “claim

for damages against the state” is reported at 464 F.Supp. 718. It

is set forth as Appendix “A”.

The opinion for affirmance of the Court of Appeals, set forth as

Appendix “B”, has not yet been reported.

Jurisdiction

The judgment of the Court of Appeals was dated and entered

July 13, 1979 (Appendix “C”).

The statutory provision believed to confer jurisdiction on this

Court to review the judgment in question by writ of certiorari is

28 U.S.C. §1254(1).

Question Presented

Is not the respondent County Commissioner of Social Services

entitled to immunity from an award of retroactive welfare

payments as an’arm of the State of New York (Mt. Healthy City

Board of Education v Doyle, 429 US 274.{1977]) and a State

defendant for purposes of the Eleventh Amendment (Edelman v

Jordan, 415 US 651, 667, n 12[1974)?

Constitutional Provisions and |

Statutes Involved

The Eleventh Amendment to the Constitution of the United

States; Article XVII, Section 1 of the Constitution of the State of

New York, 42 United States Code §602(aX1\3) and New York

Social Services Law, §153 are reproduced as Appendix “D”.

Statement of the Case

This case has been here twice before.

Certiorari was sought to review the judgment of the Court of

Appeals (529 F2d 1294) holding that the complaint in this civil

rights action (42 U.S.C. §1983) satisfied the jurisdictional

requirement of substantiality of the constitutional claim

presented. This Court denied certiorari sub nom. Tova v Holley,

426 US 954 (1976).

After remand, certiorari was again sought to review the

judgment of the Court of Appeals (553 F2d 845) holding that

plaintiff Holley is entitled to Aid to Families with Dependent

Children (AFDC) because she is “permanently residing in the

United States under color of law” within the provisions of 45

C.F.R. §233.50, a regulation of the Secretary of Health,

Education and Welfare. This Court denied certiorari sub nom.

Shang v Holley, 435 US 947 (1978).

Thus in this action plaintiff Holley has obtained that which

she sought, to wit, inclusion of her needs in the family’s AFDC

grant.* In its remand, the Court of Appeals gave direction to the

District Court. It held (553 F2d at 851):

“There remains to be considered by the District Court the

appropriate form of injunction as well as issues of

*The Immigration and Naturalization Service stated that plaintiff Holley “is

illegally in the United States” and that “this service does not céntemplate

enforcing her departure from the United States at this time. Should the

dependency of the children change, her case would be reviewed for possible

action consistent with the circumstances then existing”. The State Com-

missioner, by Decision After an Administrative Fair Hearing, had affirmed

the action of the County Commissioner in removing plaintiff Holley from

the family budget on the ground that she was an alien who was unlawfully

residing in the United States and was not eligible for public assistance (New

York Social Services Law § 131-k). Throughout this litigation we had urged

that plaintiff was not “permanently residing in the United States under

color of law” so as to be eligible under 45 C.F.R § 233.50 and that such

regulation was vague.

damages, [cf. Edelman v. Jordan, 415 U.S. 651, 667, n. 12

(1974)}] and attorney’s fees both in the District Court and

in this Court. [See Civil Rights Attorney’s Fees Awards

Act of 1976, P.L. 94-559; Torres v. Sachs, 538 F.2d 10 (2nd

Cir., 1976).]”

Decision and Order of the

District Court After Remand

(464 F.Supp. 718)

The District Court held that the State defendant was entitled

to Eleventh Amendment immunity under Edelman v Jordan,

415 US 651 (1974).

As to the County Commissioner, however, a direction was

issued requiring that he reimburse plaintiff for public assistance

benefits withheld. The Court declined to apply the holding of the

New York State Court Appeals in Beaudoin v Toia, 45 NY2d

343, 380 NE2d 246 (1978), that county commissioners of Social

Services are arms of the State and applied its perception of the

holding of this Court in Mt. Healthy City Board of Education v

Doyle, 429 US 274 (1977). It held that the County Commissioner

was not an arm of the State and was not entitled to Eleventh

Amendment immunity. The Court stated that it found support

in the Seventh Circuit decision in Mackey v Stanton, 586 F2d

1126 (7th Cir, 1978) where an Indiana social services district was

denied Eleventh Amendment immunity as to support funds in

its possession which it had collected. Finally the Court held that

“(under the federal A.F.D.C. program, each state is free to

choose the administrative system most appropriate to its needs.

Albany Welfare Rights Organization Day Care Center, Inc. v.

Schreck, 463 F.2d 620, 624 (2d Cir. 1972), cert. denied, 410 U:S.

944 (1973). A state that opts for direct state administration and

financing presumably could assert the eleventh amendment as a

complete bar to retroactive monetary liability in a case such as

this. But New York has not chosen such a system.” The Court

rejected the State Commissioner’s argument that under such

circumstances it would necessarily be capricious to withhold

Eleventh Amendment immunity from a local social services

district simply because New York had opted for local ad-

ministration of its AFDC program.

Opinion of the Court of Appeals

The Court recognized the substantiality of defendants’

arguments for County Commissioner immunity and stated that

“one does not speak with confidence in this complex and difficult

area.”

It acknowledged the “great discretion” vested in the State

Legislature in dealing with public assistance but gave weight to

the fact that the Legislature had seen fit to create local social

services districts which are required to furnish assistance and

care. The Court, confining itself to the AFDC program, found

that the fact of partial State funding was insufficient to invoke

County Commissioner Eleventh Amendment immunity.*°

The Court distinguished Mackey v Stanton, supra, as dealing

“* * * with an Indiana county’s diversion of court-ordered child

support payments which, in the absence of its action, would have

gone to the beneficiaries” (p A-26; infra, cert den, sub nom.,

Stanton v Mackey, US , No. 78-1733, October 1, 1979).

It concluded “fwle believe that the Eleventh Amendment

protection of the county defendant is not necessary ‘in order to

protect the state treasury from liability that would have * ° *

essentially the same practical consequences as a judgment

against the State itself”, citing Lake Country Estates, Inc. v

*As will appear infra, 25% of the cost of AFDC is derived from State funds.

As to home relief, a State program of public assistance, 50% of the cost is

derived from State funds. The Court did not deal with the home relief aspect.

Tahoe Regional Planning Agency, ___. US ___, 99 S.Ct. 1171

(1979).°

Reasons for Granting the Writ

I

Whether the Commissioner of the Monroe County “Social

Services District” (New York Social Services Law, §61) is a

“state defendant” for purposes of Eleventh Amendment im-

munity (Edelman v Jordan, 415 US 651, 667, n 12 [1974] is

dependent on the nature of that entity and whether it is an arm

of the State (Mt. Healthy City Board of Education v Doyle, 429

US 274 [1977).**

The Monroe County Department of Social Services is a

creature of state, not federal, law. Thus, we urge, its nature is to

be determined as matter of State law.

Concern for the delivery of public assistance is reflected in the

provision of the New York-State Constitution that “{t]he aid,

*In its opinion and judgment, the Court also affirmed the granting of in-

junctive relief and the award of attorneys’ fees. It dismissed a cross appeal

by the plaintiff involving an attempt by plaintiff to obtain retroactive

welfare payments as an adjunct to a direct action under the Fourteenth

Amendment. Finally, in its discretion, the Court directed that “no ad-

ditional amount for attorneys’ fees and no costs be awarded to either party

in connection with these appeals.”

**The local agency here implemented the policy of higher authority in denying

AFDC to plaintiff. Monell v New York City Department of Social Services,

436 US 658, 690 (1978) held that “[lJocal governing bodies, therefore, can be

sued directly under § 1983 for monetary, declaratory, or injunctive relief

where * * * the action that is alleged to be unconstitutional implements or

executes a policy statement, ordinance, regulation, or decision officially

adopted and promulgated by that body’s officers.” Since local volicy is not

involved, we urge that the County Commissioner, like the State Com-

missioner, is not a section 1983 “person”. Furthermore, plaintiff has ob-

tained a judgment on a pendent statutory claim, not on a constitutional

claim, thus further distinguishing this case from Monell.

7

care and support of the needy are public concerns and shall be

provided by the state and by such of its subdivisions, and in such

manner and by such means, as the legislature may from time to

time determine.” (Article XVII, Section 1.) The New York Court

of Appeals has held that such provision “imposes upon the State

an affirmative duty to aid the needy” and “provides the

Legislature with discretion in determining the means by which

this objective is to be effectuated * * *.” (Tucker v Toia, 43 NY2d

1, 8, 371 NE2d 449, 452 [1977]; see also Bernstein v Towa, 43 NY2d

437, 449, 373 NE2d 238, 244 [1977] and Lee v Smith, 43 NY2d

453, 460, 373 NE2d 247, 250 [1977)).

Whatever “means” the Legislature might select to deliver

public assistance in New York State could not diminish the force

of Article XVII, Section 1 in establishing that the agency

facilitating delivery is an “arm of the State.”

“For the purpose of administration of public assistance and

care the state shall be divided into county and city social services

districts ***” (New York Social Services Law §61). Thus

Monroe County is “constituted a county social services district”

(id., §61[2]). The County Commissioners’ responsibilities are

administrative (id., §65).. Policy rule-making and general

supervision are, however, for the State Commissioner and the

State Department of Social Services (id., §§17, 20, 34).

Clearly the responsibility for executing the State’s program of

public assistance rests with the State Commissioner and the

Department which she heads. The Department of Social Services

may deny or withhold State reimbursement for failure of a social

services district to comply with departmental regulations (id.,

§20{3][f]}) and may approve or disapprove local rules, regulations

and procedures (id., §20[3][a). At the suit of the State Com-

missioner the courts will require the appropriation of funds for

social welfare programs administered by a county social services

district by a county legislature. (Toia v Regan, 54 AD2d 46, 387

NYS2d 309 [4th Dept, 1976], affd 40 NY2d 837, 356 NE2d 276

[1976], app dism 429 US 1082 [1977]; see also State Board of

Social Welfare v City of Newburgh, 28 Misc2d 539, 220 NYS2d

54 [Sup Ct, Orange Co, 1961).

The New York Court of Appeals in Beaudoin v Toia, 45 NY2d

343, 380 NE2d 246 (1978) held (p 347):

“In New York State, the social services program is a

State program, administered through the 58 local social

services districts under the general supervision of the

State Department of Social Services and the State

Commissioner of Social Services. (NY Const, art XVII, §1;

Social Services Law, §§17, 20, 34.) The county com-

missioners are denominated by statute ‘agents’ of the

State department (Social Services Law, §65, subd 3). In

the administration of public assistance funds, whether

they come from Federal, State or local sources, the

authority and responsibility is that of the county com-

missioners of social services, not the counties; the local

commissioners act on behalf of and as agents for the

State. Hach is a part of and the local arm of the single

State administrative agency. Determinative of the

present question is the status and function of the local

commissioners as agents of the State and not of their

respective counties.”

and:

“Inasmuch as the local commissioners are agents of the

State department they may not substitute their in-

terpretations of the regulations of the State department

for those of the State department or the State com-

missioner * * *. To recognize any such right would be to

undermine the supervisory authority of the State

*The Beaudoin Court expressly based its holding on State law. It referred to

Federal law only as alternative rationale (45 NY2d at 348). The District

Court, therefore, erred in limiting its holding to AFDC purposes (464 FSupp

718 at 723). Compare Lindsay v Wyman, 372 FSupp 1360 (SDNY, 1974), affd

sub nom. Beame v Lavine, 419 US 806 (1974).

**ee)»

commissioner and to invite administrative chaos.

(Citations omitted, emphasis supplied.)*

Whether viewed from the perspective of State or Federal law,

the result is the same — the Monroe County Department of

Social Services is a State agency and an arm of the State.

This Court in Mt. Healthy City Board of Education v Doyle,

supra, in holding that the local school board was ineligible for

Eleventh Amendment immunity, had found that, under Ohio

law, the board was included in the term “political subdivision”.

In the case at bar, the social services districts are not political

subdivisions but “act on behalf of and as agents for the State”

(Beaudoin v Toia, supra). In Mt. Healthy, this Court found that

the local school board “is but one of many * * * within the State

of Ohio” and “is subject to some guidance from the State Board

of Education” (429 US at 280). Here the social services district is

one of only 58 such districts in the State and it acts on behalf of

the State (Beaudoin v Toia, supra). Unlike the local school board

in Mt. Healthy, the social services districts have no independent

powers to tax or to contract indebtedness. **

Clearly, in New York the local social services districts are

“more like” an arm of the State than they are like a county or

city (Mt. Healthy City Board of Education v Doyle, supra, 429 US

at 280, 281), and the “balance” (p 280) favors clothing the

defendant County Commissioner with the State’s Eleventh

Amendment immunity.

*Thus, it was held that local commissioners of social services have no standing

to seek judicial review of Decisions After Fair Hearing. Subsequently the

legislature conferred such standing, see New York Social Services Law §

22(9Xb) as added by Laws 1978, ch 473 that “laIny aggrieved party to an

appeal, including a social services official provided an application by any

such social services official has not been determined by any federal agency to

be in violation of federal law, may apply for review as provided in article

seventy-eight of the civil practice law and rules.”

** These powers are vested in the County. See Social Services Law, §§ 88, 90,

93(3\6), 92(1XaXc), Toia v Regan, supra, 54 AD2d at 50, 387 NYS2d at 312.

10

II

The effect of the judgment below is to provide plaintiff with

access to the State Treasury contrary to the provisions of the

Eleventh Amendment. For on Mav 9, 1979 a “Second Amended”

judgment was entered which, inter alia, provided that

“{pjlaintiff have judgment against defendant, James Reed, as

Commissioner of the Monroe County Department of Social

Services, in the amount of FOURTEEN HUNDRED DOLLARS

($1,400.00) for public assistance benefits withheld as a result of

the ineligibility determination at issue in this case.” And there

is no reason to assume that AFDC payments made to plaintiff by

the County Commissioner in compliance with the Court’s

direction to pay will not be reimbursed by the State in the

regular course of business.

State reimbursement is made under the provisions of New

York Social Services Law, §153(1aXd). The State reim-

burses local social services districts 50% of the amount expended

for public assistance and care for local charges after deducting

any Federal funds received or to be received. This formula, in

general practice, results in the reimbursement of 75% of the cost

of AFDC and 50% of the cost of home relief, as to which no

Federal financial participation is available. “[T]his scheme fits

well within the scope of our State Constitution’s mandate * * *”

(Toia v Regan, supra, 54 AD2d at 50, 387 NYS2d at 312).

And under that “mandate” New York social services districts

are arms of the State.

The direction of the Courts below requiring payment of

retroactive welfare payments to plaintiff has, we submit,

“essentially the same practical consequences as a judgment

against the State itself” (Lake Country Estates v Tahoe Regional

Planning Agency, US , 59 L.Ed. 2d 401, 410 [1979) and

is barred by the Eleventh Amendment (Edelman v Jordan, 415

US 651 [1974], Mt. Healthy City Board of Education v Doyle,

supra, 429 US 274 [1977].

11

Ill

In New York, social services programs, including AFDC, are

administered through local social services districts, while in

some other states, the state itself administers the program

directly. A State AFDC plan must provide that it shall be in

effect in all political subdivisions of the State, and, if ad-

ministered by them, be mandatory upon them. The program

must either be administered by a single State agency or the

administration of the plan must be supervised by a single State

agency (Social Security Act, §402[a][1][3], [42 USC, §602(aX1\3))).

In either event, the same Federal standards must be main-

tained, and it is the State that is responsible for maintaining

them. ’

The question of whether a County Commissioner may be

directed to reimburse a plaintiff for public assistance payments

withheld could not arise in a state which administers the plan

directly. It would necessarily be capricious to refuse to apply the

bar of the Eleventh Amendment in the instant case simply

because New York has opted for administration of the day-to-

day aspects of its public assistance programs, including AFDC,

at the local level.

The withholding of Eleventh Amendment County Com-

missioner immunity is, we urge, inconsistent with the State

option afforded by the Social Security Act and the states’ right to

choose freely between direct and local administration (Albany

Welfare Rights Organization Day Care Center, Inc. v Schreck,

463 F2d 620, 624 [2d Cir, 1972], cert den 410 US 944 [1973)).

12

IV

Beaudoin v Toia, supra, was briefed fully before the Court

below, and it was urged that such construction of State law by

the State Court of Appeals is binding upon the Federal judiciary,

citing Memorial Hospital v Mari-Copa County, 415 US 250, 256

(1974). The opinion of the Court below, however, did not mention

Beaudoin.

In Plumas County Board of Supervisors, et al. v Califano, 594

F2d 756 (9th Cir, 1979), cert pending, Docket No. 79-9, the Court

of Appeals stated, as to the California AFDC program, “{t]he

plan is county administered and state supervised, with the

counties acting as agents for the state in making the prescribed

payments” (594 F2d at 757). The Ninth Circuit Court of Appeals

relied upon a State case as authority for that proposition. *

Plumas and the case at bar demonstrate the inconsistent

approaches taken by different Circuit Courts in establishing the

relationship of a County Social Services Agency to the State and

furnish further reason for the granting of the Writ.

*County of Marin v Martin, 43 Cal App 3d, 1, 3; 117 Cal Rptr, 364, 365 (1974).

Martin in turn had relied, inter alia, upon County of Contra Costa of Social

Welfare Board, 18 Cal Rptr 573 (1962) where it was held that the County

function is to administer the California Aid to Needy Children program of

public assistance “as an agency of the state and for the state’s purposes” (18

Cal Rptr at 576).

13

CONCLUSION

For the reasons stated, the Petition for a Writ of Certiorari

should be granted.

Dated: Albany, New York

October 4, 1979

Respectfully submitted,

ROBERT ABRAMS

Attorney General of the

State of New York

Attorney for Petitioner

SHIRLEY ADELSON SIEGEL

Solicitor General,

State of New York

ALAN W. RUBENSTEIN

Principal Attorney,

State of New York

of Counsel

Appendices

A-1

APPENDIX A

(Decision and Order of the District Court)

Entered in the Office of the Clerk of the United States District

Court for the Western District of New York, February 1, 1979.

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF NEW YORK

GAYLE McQUOID HOLLEY, Individually and on behalf of

JAMES McQUOID, NORMAN McQUOID, THOMAS

McQUOID, DOUGLAS McQUOID, MICHAEL McQUOID, and

ADELAINE McQUOID, her minor children.

Plaintvff,

Us.

ABE LAVINE, as Commissioner of the New York State

Department of Social Services, and JAMES REED, as

Commissioner of the Monroe County Department of Social

Services,

Defendants.

Civ-75-151

APPEARANCES:

K. WADE EATON, ESQ, Greater Upstate Law Project,

Monroe County Legal Assistance Corporation, Rochester, New

York, for Plaintiff.

ROBERT ABRAMS, ESQ., Attorney General of the State of

New York (ALAN W. RUBENSTEIN, ESQ., of Counsel),

Albany, New York, for Defendant State Commissioner.

CHARLES G. FINCH, ESQ., Chief Counsel (CHARLES G.

PORRECA, ESQ., of Counsel), Rochester, New York, for

ere

A-2

APPENDIX A (Decision and Order of the District Court)

Defendant Commissioner of Monroe County Department of

Social Services.

This case is before the court on remand from the Second

Circuit to determine appropriate declaratory, injunctive and

monetary relief. The plaintiff, a Canadian citizen, first entered

the United States as a non-immigrant student. She subsequently

gave birth to six children in this country. Sometime prior to

August 1974, the plaintiff began receiving a grant of Aid to

Families with Dependent Children [A.F.D.C.] for herself and her

six children. In August 1974, the grant to plaintiff's household

was reduced by one-seventh because a new state law and

corresponding regulation rendered the plaintiff, an illegal alien,

ineligible for assistance. N.Y. Soc. Serv. L. §131-K; 18

N.Y.C.R.R. §349.3. This determination was upheld by the

Commissioner of the New York State Social Services Depart-

ment on December 19, 1974 after an administrative fair hearing.

The reduction was effective on January 15, 1975.

On April 17, 1975, the plaintiff, suing individually and on

behalf of her six minor children, filed a complaint in federal

district court against Abe Lavine, the Commissioner of the New

York State Department of Social Services (the state defendant),

and James Reed, the Commissioner of the Monroe County

Department of Social Services (the county defendant), respec-

tively. The complaint, alleging jurisdiction under 28 U.S.C.

§§1343 and 1331, and 42 U.S.C. §1983, claimed that §131-K was

inconsistent with the Social Security Act and federal regulations

and deprived the plaintiff of due process and equal protection in

violation of the fourteenth amendment. Plaintiff sought

declaratory relief, an injunction, and damages for the amount of

benefits denied her household as a result of the operation of the

state statute. She also requested a preliminary injunction

requiring defendant Reed to restore her household’s benefit level

to its prior level pending final disposition of this action.

A-3

APPENDIX A (Decision and Order of the District Court)

Motions to dismiss were submitted by both defendants, and on

July 30, 1975, Judge Burke dismissed this action “for lack of

jurisdiction over the subject matter and because the complaint

[failed] to state a claim upon which relief [might] be granted.”

The dismissal was based on Judge Burke’s finding that the

defendants were not within the scope of §1983, that the com-

plaint asserted no substantial claim of unconstitutionality, and

that the amount in controversy did not exceed $10,000, exclusive

of interest and costs.

Judge Burke’s dismissal of the complaint was reversed by the

United States Court of Appeals for the Second Circuit in Holley

v. Lavine, 529 F.2d 1294 (2d Cir.) (per curiam), cert. denied, 426

U.S. 954 (1976). The Second Circuit agreed that the amount in

controversy did not exceed $10,000 and that consequently

jurisdiction did not lie under 28 U.S.C. §1331. Jd. at 1295.

However, the court found that the complaint stated a substantial

claim of unconstitutionality within the scope of §1983 and

remanded the case to the district court to consider the plaintiff's

statutory and regulatory claims and to convene a three-judge

court, if necessary, pursuant to 28 U.S.C. §2281. Id. at 1296.

On remand, both defendants answered, and all parties moved

for summary judgment. Judge Burke granted the defendants’

cross-motions and denied the plaintiff's motion for summary

judgment as well as her request to convene a three-judge court to

hear the constitutional claims.

The plaintiff appealed and again the case was reversed and

remanded in Holley v. Lavine, 553 F.2d 845 (2d Cir. 1977). The

Court of Appeals found that since the plaintiff had official

assurance that she would not be deported, at least until her

children were no longer dependents, she was ‘permanently

residing in the United States under color of law” within the

meaning of the pertinent eligibility regulation promulgated

under the Social Security Act. Jd. at 851. It also stated that its

A-4

APPENDIX A (Decision and Order of the District Court)

finding of inconsistency between state law and the applicable

federal regulation mooted the issue as to whether state law, “if

applied to preclude the payment of A.F.D:C. benefits to an alien

not permanently residing lawfully in the United States, would

violate the Fourteenth Amendment to the United States

Constitution.” Jd. Accordingly, the court held that there was no

reason to convene a three-judge court to consider plaintiff's

constitutional claims. The case was again remanded to the

district court with the following instructions:

There remains to be considered by the District Court

the appropriate form of injunction as well as issues of

damages, [cf. Edelman v. Jordan, 415 U.S. 651, 667, n. 12,

94 S.Ct. 1347, 39 L.Ed.2d 662 (1974)] and attorney’s fees

both in the District Court and in this Court. [See Civil

Rights Attorney’s Fees Awards Act of 1976, P.L. 94-559,

90 Stat. 2641; Torres v. Sachs, 538 F.2d 10 (2nd Cir. 1976).]

Since it appears the original judge might have dif-

ficulty in putting aside previously expressed views, and

reassignment is advisable to avoid the appearance of pre-

judgment, the case will be remanded to the District Court

for reassignment in keeping with the principles stated in

ie States v. Robin, 553 F.2d 8, 10 (2nd Cir., March 30,

Reversed and remanded for the issuance of an ap-

propriate injunction, and for consideration of issues of

damages and attorney’s fees both in the District Court

and in this Court.

Id.

On remand, the case was assigned to my part for deter-

mination of appropriate relief. The plaintiff seeks a declaration

of the invalidity of the statute and an injunction against its

enforcement as well as an award of damages, counsel fees, and

litigation costs. The damages sought consist of the funds

withheld from the plaintiff's public assistance grant as a result

of defendant’s decision of August 20, 1974.

A-5

APPENDIX A (Decision and Order of the District Court)

The issues have been thoroughly briefed by all of the parties.

Oral argument was held on May 23, 1978. On August 9, 1978,

upon stipulation of the parties, reargument was held in light of

the Supreme Court’s recent decisions in Monell v. Department of

Social Services, 436 U.S. 658 (1978) (holding that local governing

bodies are subject to suit as “persons” under §1983), and Hutto v.

Finney, ____ U.S. ____ (1978) (holding that 42 U.S.C. §1988 does

not violate the eleventh amendment), and the Second Circuit’s

decision in Turpin v. Mailet, 579 F.2d 152 (2d Cir. 1978).! In

addition, supplemental briefs were filed with the court. After

carefully considering the positions of the parties, I am prepared

to rule on the plaintiff's request for relief.

I. DECLARATORY AND INJUNCTIVE RELIEF

The Second Circuit in its second decision found that N.Y. Soc.

Serv. Law §131-K was inconsistent with the controlling federal

regulation, 45 C.F.R. §233.50, because §131-K denied public

assistance to New York residents “permanently residing in the

United States under color of law.” 553 F.2d at 851. Since it also

stated that the plaintiff's status was highly unusual, in that she

was an illegal alien with official assurance that she would not be

deported, the defendants urge the court to limit declaratory and

injunctive relief to the facts of this case. But in light of the

Second Circuit’s determination of inconsistency, I find no basis

for doing so. Cf. Galvan v. Levine, 490 F.2d 1255, 1261 (2d Cir.

1973), cert. denied, 417 U.S. 936 (1974). Accordingly, §131-K is

declared invalid insofar as it denies public assistance to New

York residents permanently residing in the United States under

color of law, and the defendants are permanently enjoined from

enforcing the statute.

*This case was vacated by the Supreme Court and remanded for recon-

sideration in light of Monell v. Department of Social Services, supra. West

Haven v. Turpin, 47 U.S.L.W. 3368 (U.S. Nov. 28, 1978). See discussion infra.

A4

APPENDIX A (Decision and Order of the District Court)

II. DAMAGES

A more difficult question is whether the plaintiff is entitled to

recover retroactive welfare payments from the defendants. The

plaintiff argues that damages can be awarded on a number of

theories. For the reasons outlined below, I find that the state

defendant is shielded from a damage award by the eleventh

amendment, but that the county defendant is liabie for

retroactive payments.

A. STATE DEFENDANT

The first theory asserted by the plaintiff against the state is

that benefits withheld after the complaint was filed on April 17,

1975 can be awarded as ancillary to injunctive relief. In Edelman

v. Jordan, 415 U.S. 651, 668 (1974), however, the Supreme Court

refused to characterize the damages sought in that case as a form

of “equitable restitution,” recoverable under the doctrine of Ex

parte Young, 209 U.S. 123 (1908), without regard to the eleventh —

amendment. D’orio v. County of Delaware, No. 77-1241 (E.D.

Pa. Feb. 22, 1978), to the extent it holds otherwise, appears to be

inconsistent with Edelman. Mauclet v. Nyquist, 406 F.Supp.

1233, 1236 (W.D.N.Y. 1976), did not expressly consider whether

requalification of the plaintiff as a regents scholarship recipient

as of the date the complaint was filed violated Edelman.

With the benefit of hindsight, it is clear that most of plaintiff's

damages could have been avoided if the district court had

correctly applied the law at the time that the plaintiff moved for

preliminary relief. But this does not change the retroactive

nature of a damage award at this stage of the proceedings. The

plaintiff is not seeking a payment of state funds as a necessary

consequence of future compliance with a federal court order but

rather an award of public assistance payments wrongfully

withheld in the past. This type of relief is barred by Edelman.

A-7

APPENDIX A (Decision and Order of the District Court)

The second theory urged by the plaintiff is that she can recover

all benefits wrongfully withheld from January 15, 1975 to April

27, 1977 without regard for the eleventh amendment under the

cause of action alleged in the complaint directly under the

fourteenth amendment. In support of this theory, the plaintiff

cites Turpin v. Mailet, supra, which held that a remedy may be

implied from the protective provisions of §1 of the fourteenth

amendment and that monetary relief is one of the remedies

available.

Since oral argument, however, Turpin was vacated by the

Supreme Court and remanded for consideration in light of

Monell v. Department of Social Services, supra. West Haven v.

Turpin, 47 U.S.L.W. 3368 (U.S. Nov. 28, 1978). On remand, the

Second Circuit concluded that

under the very rationale of our prior opinion — there is

no place for a cause of action against a municipality

directly under the 14th Amendment, because the plaintiff

may proceed against the City of West Haven under §1983.

Turpin v. Mailet, No. 77-7545, slip op. at 5405 (2d Cir. Jan. 16,

1979). An additional difficulty with this argument is that it

would require a finding of jurisdiction under 28 U.S.C. §1331,

which the Second Circuit rejected on the first appeal of this case

because the amount in controversy did not exceed $10,000. 529

F.2d at 1295. On remand, this court is bound by the Second

Circuit’s ruling.

A third theory asserted by the plaintiff rests on the Supreme

Court decisions in Monell, supra and Finney, supra. In light of

Monell, the plaintiff now has a cause of action under §1983

against the state and county agencies. Based on Finney, the

plaintiff argues that §1983, like §1988, is a statute which

abrogates eleventh amendment immunity.

AS

APPENDIX A (Decision and Order of the District Court)

This argument assumes that Edelman has been overruled sub

silento by the Supreme Court. However, two circuit courts which

have considered this question in the wake of Monell and Finney

have concluded that Edelman continues to bind federal courts

absent a clearer statement from the Supreme Court allowing

damage actions against the states under §1983. Skehan v. Board

of Trustees, 47 U.S.L.W. 2441 (3d Cir. Dec. 21, 1978); Bogard v.

Cook, No. 76-2890, slip op. at 1534 (5th Cir. Dec. 15, 1978). These

conclusions are fully supported by the opinions in Monell and

Finney.

Monell, which found that a local school board was a “person”

under §1983, expressly states that its holding is “limited to local

government units which are not considered part of the State for

Eleventh Amendment purposes.” Supra at 690 n.54. The

reasoning in Monell is equally applicable to state agencies and it

may be fairly read to subject state agencies to injunctive relief

under §1983, but at no point does the decision authorize an

award of retroactive damages against the state.

In Finney, at least one member of the Court has indicated that

the “foundations” of Edelman have been “significantly un-

dermined.” Supra at ___ (J. Brennan, concurring). But the

majority opinion cites Edelman with approval and characterizes

awards of attorneys’ fees as noncompensatory litigation costs in

order to avoid a conflict between the two cases. Moreover, four of

the Justices dissent on the ground that Edelman precludes an

award of attorneys’ fees under 42 U.S.C. §1988. Although the

present court does not agree on the proper interpretation of the

eleventh amendment, it cannot be said that Edelman has been

implicitly overruled. I therefore must reject the plaintiff's claim

for damages against the state.

A-9

APPENDIX A (Decision and Order of the District Court)

B. COUNTY DEFENDANT

Different considerations apply in determining whether the

plaintiff can recover damages from the county defendant. As a

general rule, eleventh amendment immunity does not extend to

counties and other local government units. See, e.g., Moor v.

County of Alameda, 411 U.S. 693, 717-721 (1973). This was

recognized by the Supreme Court in Edelman, supra at 667 n.12.

Only if the county or similar municipal corporation is acting as

an arm of the state does it share the state’s immunity. Mount

Healthy Board of Education v. Doyle, 429 U.S. 274, 280 (1977).

This rule is equally applicable to agencies of the county, such as

local departments of social services and their commissioners.

The question at issue here is whether the state is the real party

in interest in the action against the county commissioner and is

determined by examining “the nature of the entity created by

state law.” Mount Healthy, supra. A number of factors have

been considered by the courts. Gallagher v. Evans, 536 F.2d 899,

901 (10th Cir. 1976); George R. Whitten, Jr., Inc. v. State

University Construction Fund, 493 F.2d 177, 179-80 (1st Cir.

1974); Urbana v. Board of Managers, 415 F.2d 247, 250-51 (3d Cir.

1969), cert. denied, 397 U.S. 948 (1970); Krisel v. Doran, 258 F.

Supp. 845, 849 (S.D.N.Y. 1966), affd per curiam, 386 F.2d 179 (2d

Cir. 1967), cert. denied, 390 U.S. 1042 (1968). However, the

primary consideration in all of the cases, including Mount

Healthy, is the extent to which the local agency or official is

financially independent of the state. See also Rothstein v.

Wyman, 467 F.2d 226, 236 (2d Cir. 1972), cert. denied, 411 US.

921 (1973). In Edelman, supra at 663, 665, the question was

phrased in terms of whether a judgment against the defendant

would inevitably be satisfied out of the general revenues of the

state. This determination is a matter of federal law, and federal

courts are not necessarily bound by state court decisions. See,

e.g., Savage v. Kibbee, 426 F. Supp. 760, 765 (S.D.N.Y. 1976).

A-10

APPENDIX A (Decision and Order of the District Court)

The plaintiff does not dispute that county social services

departments are “arms of the state” for the purpose of ad-

ministering federal welfare programs. This was established

recently by the New York Court of Appeals in Beaudoin v. Tova,

45 N.Y.2d 343, 408 N.Y.S.2d 417 (1978), which held that a county

department of social services has no standing to challenge a fair

hearing decision of the State Commissioner of Social Services.

Federal law in fact requires this result. 42 U.S.C. §602(a).

But this does not resolve the issue. It is also well established

that a judgment against a county department of social services

or its commissioner in his official capacity does not bind the

state and is not automatically payable out of state funds. Tova v.

Regan, 387 N.Y.S.2d 309 (App. Div. 4th Dep't), affd per curiam,

40. N.Y.2d 837, 387 N.Y.S.2d 832 (1976); Jones v. Berman, 37

N.Y.2d 42, 371 N.Y.S.2d 422 (1975). The relationship between the

state and the county agencies has been described in the following

terms:

Erie County is a duly established county social services

district (Social Services Law, §§52, 61[3]). As such, it bears

ultimate responsibility for the administration of public

assistance and care for its residents although it may

share this responsibility, under certain circumstances,

with other municipalities located within its territorial

boundaries (Social Services Law, §69). An important

element of this responsibility is the mandatory duty of

the County’s board of supervisors “to make adequate

appropriations * * * to provide the public assistance and

care required by * ° * [the Social Services Law]” (Social

Services Law, §88). Additionally, the County is

specifically obligated to make deficiency appropriations,

should the need arise, to fulfill its public assistance

responsibilities with regard to both home relief (Social

Services Law, §93{3], [6]) and the federally-aided programs

of aid to dependent children and medical assistance

(Social Services Law, §92{1] [a], [c]). The Social Services

Law does provide for reimbursement by the State for

A-11

APPENDIX A (Decision and Order of the District Court)

fifty percent of the nonfederally reimbursed cost of these

programs, including day care (Social Services Law,

§§153[1] [d], [e], 368-a{1} “idl 410-c[1] [a]. Further, the

statute places the power over the administration and

regulation of this system of public assistance and care

largely in the hands of the State Department of Social

Services and its Commissioner (Social Services Law, §§17,

20, 34).

[1] This legislative scheme, then, focuses day-to-day

administrative duties upon the county social services

districts while concentrating policy and rule-making

authority in the state agency. It also establishes an af-

firmative burden upon the county social services districts

to appropriate necessary funding for the operation of

these public assistance programs but, then, eases this

burden by providing for fifty percent state reim-

bursement of all such funding not otherwise subject to

federal reimbursement.

Toia v. Regan, 387 N.Y.S.2d at 312.2

Under this scheme, county governments have an obligation to

finance public assistance payments even if higher levels of

government refuse to reimburse the county. See, e.g., Jones v.

Berman, supra. Although in most cases state and federal funding

is available for reimbursement, there is no clear rule requiring

the state to indemnify the counties for judgments entered

against them. Moreover, only fifty percent of the nonfederal

share of public assistance payments under the A.F.D.C. program

is reimbursed by the state. For these reasons, I find that the

county defendant is not an arm of the state for eleventh

amendment purposes.

This conclusion is supported by the Seventh Circuit’s decision

in Mackey v. Stanton, No. 78-1513 (7th Cir. Nov. 8, 1978), the

only case directly in point brought to the court’s attention. On

2The references to Erie County are equally applicable to Monroe County.

A-12

APPENDIX A (Decision and Order of the District Court)

similar facts, the court found that an award of retroactive public

assistance benefits could be entered against a county social

services agency and its officials in Indiana. It reached its con-

clusion by applying the analysis used by the Supreme Court in

Mount Healthy to Indiana’s funding scheme. Summarizing its

analysis, the court stated:

In all respects that the Supreme Court seemed to

consider significant in Mt. Healthy, the county depart-

ment here is similar to the school board in that case.

Although both are subject to state supervision and

depend heavily on state funds, they perform their duties

on a local level. More important, both have the power to

raise their own funds by tax levy and by bond issuance.

Significantly, Ind. Code Ann. §12-1-11-13 (Burns) is

analogous to Ohio Rev. Code Ann. §133.27 (Page),

providing a manner for payment of judgments without

resort to the state treasury.

Although the New York scheme differs from Indiana’s in that

county social services departments in New York must rely on

local legislative bodies for funding, the power and the duty to

raise and appropriate welfare funds nevertheless rest at the local

rather than the state level. The only other significant difference

between the New York and the Indiana schemes makes it clear

that counties in New York are less dependent on state funds

than counties in Indiana. Only 50% of non-federal funds paid to

A.F.D.C. recipients in New York are reimbursed by the state

whereas in Indiana the state reimburses the counties for 100% of

their expenditures. In New York, it cannot even be said that a

judgment against the county social services commissioner is

indirectly payable out of state funds.

Although it may seem unfair to hold local communities

responsible for funding public assistance and for paying court-

ordered awards of retroactive assistance at the same time that

administrative policies are dictated by the state and federal

A-13

APPENDIX A (Decision and Order of the District Court)

governments, any unfairness is a consequence of the New York

legislature’s decision to place the responsibility for funding

public assistance on the localities. The constitutionality of this

scheme was upheld by the New York Court of Appeals in Tova v.

Regan, supra. Under the federal A.F.D.C. program, each state is

free to choose the administrative system most appropriate to its

needs. Albany Welfare Rights Organization Day Care Center, .

Inc. v. Schreck, 463 F.2d 620, 624 (2d Cir. 1972), cert. denied, 410

US. 944 (1973). A state that opts for direct state administration

and financing presumably could assert the eleventh amendment

as a complete bar to retroactive monetary liability in a case such

as this. But New York has not chosen such a system.

The county defendant is directed to reimburse the plaintiff for

public assistance benefits withheld as a result of the ineligibility

determination at issue in this case.

Ill. ATTORNEYS FEES

The final issue before the court is the plaintiff's entitlement to

an award of attorney’s fees under the Civil Rights Attorney’s

Fees Awards Act of 1976, 42 U.S.C. §1988. For the reasons stated

below, I find that the defendants are liable for a fee award under

§1988.

The Supreme Court’s decision in Finney squarely rejected the

main argument raised by the defendants against an award by

holding that the eleventh amendment does not bar an award of

attorneys’ fees or costs against the state in §1983 actions. The

defendants now argue that it would be unfair to penalize them

for their good faith efforts to implement the federal regulation,

which they claim isambiguous.

In §1983 cases, fees should ordinarily be awarded to successful

plaintiffs unless special circumstances would make such an

award unjust. Mid-Hudson Legal Services v. G. & U., Inc., 578

A-14

APPENDIX A (Decision and Order of the District Court)

F.2d 34, 37-38 (2d Cir. 1978). Zarcone v. Perry, 581 F.2d 1039,

1044 (2d Cir. 1978), outlines the underlying factors to be con-

sidered in applying the Newman-Northcross rule to attorney’s

fees applications in §1983 actions. These factors, when applied to

this case, support the plaintiff's position.

The plaintiff sought and obtained broad equitable relief which

will benefit resident aliens in addition to the plaintiff. Although

the size of the group affected by this litigation may not be large,

the claim involved significant federal rights. Because the

plaintiff's claim did not involve substantial monetary damages

and is one which many United States citizens would regard as

unpopular, it is highly unlikely that the plaintiff could have

retained other counsel to act on her behalf. The cost of this

litigation and the time and effort required by plaintiff's counsel

in order to bring the case to its conclusion, especially in light of

the two appeals involved, plainly were disproportionate to any

sum the plaintiff might reasonably have expected to recover on

her own behalf. All of these circumstances justify an award of

fees to the plaintiff. Zarcone, supra; Mauclet v. Nyquist, No. 75-

73 (W.D.N.Y. Oct. 20, 1978).

The defendants have failed to point to any circumstances

which would render an award unjust. Good faith alone does not

preclude an award of attorney’s fees. Mid-Hudson, supra. The

risk of incurring liability for good faith mistakes in interpreting

federal requirements is one of the risks which the state assumes

when it participates in the federal A.F.D.C. program. Although

the defendants argue that the federal regulation involved in this

case is ambiguous, this litigation might have been avoided had

the state enacted the federal language.

Finally, it is well established that attorneys who provide legal

services for free or for nominal rates are nevertheless entitled to

recover fees under §1988. See, e.g., Mid-Hudson, supra; Beazer v.

A-15

APPENDIX A (Decision and Order of the District Court)

New York City Transit Authority, 558 F.2d 97 (2d Cir. 1977). In

light of all of these considerations and in the exercise of my

discretion, | find that the plaintiff's motion for attorneys’ fees

should be granted.

The parties are directed to meet and attempt to agree upon a

reasonable amount of a fee award and to report to the court in

thirty (30) days from the date of this order.

So ordered.

ls) JOHN T. CURTIN

United States District Judge

DATED: February 1, 1979

A-16

APPENDIX B

(Opinion of the Court of Appeals)

UNITED STATES COURT OF APPEALS

For the Second Circuit

Nos. 1152, 1153, 1154 — August Term, 1978.

(Argued June 1, 1979 Decided July 13, 1979.)

Docket Nos. 79-7182, 79-7190, 79-7207

GAYLE McQUOID HOLLEY, individually and on behalf of

JAMES McQUOID, NORMAN McQUOID, THOMAS

McQUOID, DOUGLAS McQUOID, MICHAEL McQUOID, and

ADELAINE McQUOID, her minor children,

Plaintiff-A ppellee-Cross-Appellant,

vs.

ABE LAVINE, as Commissioner of the New York State

Department of Social Services, and

JAMES REED, as Commissioner of the Monroe County

Department of Social Services,

Defendants-A ppellants-Cross-A ppellees.

Before:

FRIENDLY and FEINBERG, Circuit Judges, and NEAHER,

District Judge. *

*Hon. Edward R. Neaher, of the United States District Court for the Eastern

District of New York, sitting by designation.

oo A tem cen arbeins BE

SRR Rane ate

A-17

APPENDIX B (Opinion of the Court of Appeals)

Appeal and cross-appeal from judgment of United States

District Court for the Western District of New York, John T.

Curtin, Ch. J., awarding retroactive welfare benefits against a

County Commissioner of Social Services, denying such an award

against a State Commissioner of Social Services, enjoining in

part application of a State Social Services law and awarding

attorneys’ fees to plaintiff against both the County and State

Commissioners of Social Services.

Judgment affirmed and cross-appeal dismissed.

K. WADE EATON, Rochester, N.Y. (Greater Up-State Law

Project, Rochester, N.Y.), for Plaintiff-Appellee-Cross-

Appellant Gayle McQuoid Holley.

ALAN W. RUBENSTEIN, Principal Attorney, Albany, N.Y.

(Robert Abrams, Attorney General of the State of New York,

Jeremiah Jochnowitz, Assistant Solicitor General, Albany,

N.Y., of Counsel), for Defendant-Appellant-Cross-A ppellee Abe

Lavine, Commissioner of the New York State Department of

Social Services.

CHARLES G. PORRECA, Rochester, N.Y. (Monroe County

Department of Social Services, Sam DiLalla, Acting Chief

Counsel, of Counsel), for Defendant-Appellant-Cross-Appellee

James Reed, Commissioner of the Monroe County Department

of Social Services.

FEINBERG, Circuit Judge:

This case raises difficult issues of application of the Eleventh

Amendment in suits involving welfare benefits. For reasons

given below, we affirm a district court judgment that awards

plaintiff such benefits retroactively against a County Social

Services Commissioner, denies such an award against a State

A-18

APPENDIX B (Opinion of the Court of Appeals)

Social Services Commissioner and awards counsel fees to

plaintiff against both defendants.

In April 1975, Gayle McQuoid Holley, individually and on

behalf of her six children, sued Abe Lavine, then Commissioner

of the New York State Department of Social Services, and James

Reed, then Commissioner of the Monroe County Department of

Social Services, in the United States District Court for the

Western District of New York.! Plaintiff Holley was then (and

presumably still is) an “illegal” alien, but her six children are all

American citizens, since they were born in this country.

Although plaintiff came here illegally, the Immigration and

Naturalization Service for humanitarian reasons has allowed

plaintiff to remain in this country, to prevent the separation of

mother and children. Plaintiffs complaint sought an order

requiring defendants to restore a one-seventh cut in benefits

under the Aid to Families with Dependent. Children (AFDC)

program and invalidating section 131-k of the New York Social

Services Law, insofar as it deprives certain illegal aliens of

AFDC benefits.” In the period since plaintiff filed her complaint

lFor convenience only, we will call the County Commissioner the County

defendant and the State Commissioner the State defendant.

2New York Social Services Law §131-k provides:

1. Any inconsistent provisions of this chapter or other law notwith-

standing, an alien who is unlawfully residing in the United States or who

fails to furnish evidence that he is lawfully residing in the United States

shall not be eligible for aid to dependent children, home relief or medical

assistance.

2. An otherwise eligible applicant or recipient who has been determined to

be ineligible for aid to dependent children, home relief or medical assistance

because he is an alien unlawfully residing in the United States or because he

failed to furnish evidence that he is lawfully residing in the United States

shall be immediately referred to the United States immigration and

naturalization service, or the nearest consulate of the country of the ap-

plicant or the recipient for such service or consulate to take appropriate

action or furnish assistance.

A-19

APPENDIX B (Opinion of the Court of Appeals)

over four years ago, her case has twice been in both this court

and in the Supreme Court, and she now appears here for the

third time, on this occasion as appellee and cross- appellant. A

brief summary of what has transpired follows:

In July 1975, the district court dismissed plaintiff's complaint

for lack of jurisdiction and for failure to state a claim on which

relief might be granted. This court reversed, holding that

plaintiff had alleged a constitutional claim under 42 U.S.C. §

1983 substantial enough to confer jurisdiction under 28 U.S.C. §

1343(3). Holley v. Lavine, 529 F.2d 1294 (2d Cir.) (per curiam),

cert. denied, 426 U.S. 954 (1976). Plaintiff’s constitutional claim

is that denial of AFDC benefits fairly discriminates against

those few “illegal” aliens in her unusual situation, denying equal

protection of the laws to her own right and to her six children -

who, although citizens, are also penalized by the reduction in

household benefits. In our prior opinion, we noted that while

only a three-judge court could, under the law at that time, decide

this claim, plaintiff also alleged that section 131-k conflicts both

with provisions of the Social Security Act? and with an HEW

regulation.’ The basis of this claim was that these require aid to

be given to otherwise eligible persons who are aliens “lawfully

admitted for permanent residence or otherwise permanently

residing in the United States under color of law” and that

plaintiff resides here “under color of law,” because the im-

migration authorities have allowed her to stay. 529 F.2d at

1296. We further observed that the district court had “pendent

jurisdiction” over these “claims of conflict between New York

State and federal law,” which a single district judge could decide.

Id.

342 U.S.C. §§601, 602(aX10) and 606(b)(1).

445 C.F.R. §233.50.

A-20

APPENDIX B (Opinion of the Court of Appeals)

We remanded the case to the district court where all parties

moved for summary judgment. The district court again decided

for defendants, this time on the ground that the New York

statute did not conflict with the Social Security Act and the

regulation. Plaintiff appealed to this court, and we again

reversed the judgment of the district court. Holley v. Lavine, 553

F.2d 845 (2d Cir. 1977), cert. denied. 435 U.S. 947 (1978). We

pointed out that “plaintiff is in what is almost certainly a

minuscule sub-class of aliens who, although unlawfully residing

in the United States, are each individually covered by a letter

[from the Government] stating that [it] ‘does not contemplate

enforcing . . . [the alien’s]. . . departure from the United States at

this time.’” 553 F.2d at 849. We went on to hold that in this

unusual situation where an alien parent has an official

assurance that the parent will not be deported at least

until the children are no longer dependent on that parent,

such parent is “permanently residing in the United

States under color of law.”

Id. Therefore, section 131-k was, at least as applied to plaintiff

Holley and her class, in conflict with the governing federal law,

and the reduction in benefits was improper. On this theory, it

was unnecessary to decide the equal protection issue. We again

remanded the case to the district court (assigning it to another

judge) to consider the appropriate form of injunction and issues

of damages and attorneys’ fees. 553 F.2d at 851.

In the district court, the case was reassigned to Chief Judge

John T. Curtin. After further argument and briefing, the judge

granted plaintiff's motion for a permanent injunction against

enforcement of the applicable portion of section 131-k, directed

the County defendant “to reimburse the plaintiff for public

assistance benefits withheld as a result of the ineligibility

determination.”° and awarded plaintiff counsel fees against both

5The amount of plaintiff's damages was subsequently fixed at $1,400 in an

amended judgment.

Birra

A-21

APPENDIX B (Opinion of the Court of Appeals)

the State and County defendants.® However, on Eleventh

Amendment grounds, the judge denied plaintiff an award of

retroactive benefits against the State defendant. Judge Curtin’s

thorough opinion is reported at 464 F. Supp. 718 (W.D.N.Y.

1977). On this third appeal to this court, the County defendant

argues that the Eleventh Amendment also bars an award of

benefits against him, as does the defense that he acted in good

faith. Both defendants also offer various reasons why the grant

of attorneys’ fees is not proper. Plaintiff cross-appeals, arguing

that she should have been awarded back payments against the

State defendant as well as against the County defendant, and

offers an elaborate alternative theory to justify that result.

Appeal of the County Defendant

The district court held that the Eleventh Amendment did not

bar an award of retroactive AFDC benefits to plaintiff against

the County defendant. That Amendment, which has received

increased judicial attention in the last decade, provides as

follows:

The Judicial power of the United States shall not be

construed to extend to any suit in law or equity, com-

menced or prosecuted against one of the United States by

Citizens of another State, or by Citizens or Subjects of

any Foreign State.

In Edelman v. Jordan, 415 U.S. 651 (1974), the Supreme Court

held that the Amendment prohibited that portion of a federal

district court’s decree that ordered Illinois state officials to pay

6We are advised that the parties have agreed that the proper amount of

attorneys’ fees is $10,000. Under the circumstances, we are not disposed to

take too technical a view on whether there now is an appealable final

judgment under 28 U.S.C. §1291. Cf. Cinerama, Inc. v. Sweet Music, S.A., 482

F.2d 66, 70 n.2 (2d Cir. 1973); Fase v. Seafarers Welfare & Pension Plan, 589

F.2d 112, 114-15 n.3 (2d Cir. 1978).

A-22

APPENDIX B (Opinion of the Court of Appeals)

retroactive public assistance benefits.” In this case, Judge Curtin

relied on Edelman v. Jordan in refusing to grant damages

against the State defendant but went on to hold that the County

defendant is not an arm of the State for purposes of Eleventh

Amendment immunity. The correctness of this ruling is the key

issue on the County defendant’s appeal.

We start with the proposition reaffirmed in Edelman v.

Jordan, supra, 415 U.S. at 667 n.12, that “a county does not

occupy the same position as a State for purposes of the Eleventh

Amendment.” The same footnote states that “while county

action is generally state action for purposes of the Fourteenth

Amendment,” as plaintiff alleged here in her section 1983 action,

“a county defendant is not necessarily a state defendant for

purposes of the Eleventh Amendment.” Id. Subsequently, in Mt.

Healthy City Board of Educ. v. Doyle, 429 U.S. 274, 280 (1977),

the Court characterized the relevant issue as whether the School

Board defendant there was “to be treated as an arm of the State

partaking of the State’s Eleventh Amendment immunity, or...

as a municipal corporation or other political subdivision to

which the Eleventh Amendment does not extend.” In the same

passage the Court also stated that “[t]he bar of the Eleventh

Amendment ... does not extend to counties and similar

municipal corporations.” Since defendant James Reed, as

Commissioner of the Monroe County Department of Social

Services, is concededly an employee of Monroe County, it is

arguable that this fact, under the Court’s criteria, resolves the

issue here. But defendants argue that local social services

agencies, unlike counties, are considered to be “arm[s] of the

7The benefits were provided under federal-state programs of Aid to the Aged.

Blind or Disabled (AABD). For Eleventh Amendment purposes we see no

distinction between the AABD benefits in that case and the AFDC benefits

here.

A-23

APPENDIX B (Opinion of the Court of Appeals)

State” since they are a part of, and supervised by, the State

Department of Social Services.®

Defendants stress that in Mt. Healthy, supra, 429 U.S. at 280,

the Court pointed out that the answer to the Eleventh Amend-

ment inquiry “depends, at least in part, upon the nature of the

entity created by state law.” According to defendants, we must

first look to the New York State constitution, which provides

that “{t]he aid, care and support of the needy are public concerns

and shall be provided by the state and by such of its subdivisions,

and in such manner and by such means, as the legislature may

from time to time determine.” N.Y. Const. art. 17, § 1. Thus, as

defendants contend, the state legislature has been given the

power under state law to control the public welfare system and

to determine the manner and means of providing public

assistance to the people in the state. The state legislature has

divided the state into “county and city social services districts,”

N.Y. Soc. Serv. Law § 61, of which Monroe County is one. And

the responsibilities of a commissioner of a County Department

of Social Services, like defendant James Reed here, are essen-

tially to administer, N.Y. Soc. Serv. Law § 65, rather than to

make, policy. Defendants tell us that the Monroe County

Department of Social Services differs from other Monroe County

departments because it has its own legal staff to handle welfare

matters exclusively and, unlike the County of Monroe itself, is

truly “an arm of the State.” :

These are substantial arguments, and one does not speak with

confidence in this complex and difficult area. See generally

Baker, Federalism and the Eleventh Amendment, 48 U. Colo. L.

Rev. 139 (1977). It is true that the state constitution gives great

discretion to the state legislature in dealing with public

8The State and County defendants offer similar arguments on this issue. For

convenience, we will consider together the contentions of both defendants

and not distinguish between them.

A-24

APPENDIX B (Opinion of the Court of Appeals)

assistance. But that legislature has seen fit to create local social

service districts, which are required by law to provide for the

“assistance and care of any person ... who is in need of public

assistance and care which he is unable to provide for himself.”

N.Y. Soc. Serv. Law § 62(1). Moreover, section 88 of the New

York Social Services Law makes it “the duty of the board of

supervisors of a county, the town board of a town and the ap-

propriating body of a city to make adequate appropriations and

to take such an action as may be necessary to provide the public

assistance and care required by this chapter.” Although it is not

completely clear from this language that “the public assistance

and care required by this chapter” includes participation in the

federaliy-assisted AFDC program as distinguished from general

welfare payments, this seems to be assumed in Jones v. Berman,

37 N.Y.2d 42 (1975). That the State controls the policies of the

County Department of Social Services is not decisive on the

Eleventh Amendment issue. In Lake Country Estates, Inc. v.

Tahoe Regional Planning Agency, 99 S.Ct. 1171, 1177 (1979), the

Court noted that it has “consistently refused to construe the

Amendment to afford protection to political subdivisions such as

counties and municipalities, even though such entities exercise a

‘slice of state power.’”

upon whom rests the primary obligation to make payments to

the AFDC recipient, and as discussed below, that entity appears

to be the County.

In minimizing the County’s obligation, defendants emphasize

that only 25 percent of the AFDC program is ultimately funded

by the County, since 50 percent is paid for by the federal

government and 25 percent by the State. If anything, this cuts

against defendants’ argument. It is one thing to indulge in the

semi-fiction that a state needs Eleventh Amendment protection

for the full amount of a judgment against a state commissioner

for past AFDC benefits, when half of the money will come back

Of much greater significance is the entity \

A-25

APPENDIX B (Opinion of the Court of Appeals)

to the state from the federal government. The argument becomes

strained when the judgment is against the County defendant and

the State will eventually bear only 25 percent of the total.

Defendants also argue that if New York State had chosen, as

some states do, to administer public assistance payments

directly rather than through county social services districts, the

Eleventh Amendment would have been a bar and it is therefore

capricious not to apply it here. But, as Judge Curtin correctly

pointed out, “any unfairness is a consequence of the New York

legislature’s decision to place the responsibility for funding

public assistance on the localities,” 464 F’. Supp. at 725.

Defendants also stress that the State advances money to the

County in anticipation of reimbursable local expenditures for

public assistance and care. But this is a matter of administrative

convenience. It seems to us more important that the County

defendant would be liable to an AFDC recipient even if the State

did not advance the money. Monroe County has its own taxing

authority, N.Y. Const. art. 8, § 10; N.Y. County Law §§ 233, 233-

a(1) (4), is an independent political entity, N.Y. County Law, § 3,

appoints the local County commissioner who is a defendant here,

County Law §400(4) (b), and bears “ultimate responsibility” for

public assistance payments. Toia v. Regan, 54 A.D.2d 46, 50 (4th

Dept.), aff'd, 40 N.Y.2d 837 (1976), appeal dismissed, 429 U.S.

1082 (1977). Moreover, “the county’s duty to provide assistance is

not dependent upon the receipt of equivalent money from the

State and the cases have so held.” Jones v. Berman, supra, 37 _ :

N.Y.2d at 55. That the State chooses to reimburse the County

defendant for 25 percent of the total retroactive payment should

not be controlling on this issue.? We believe that Eleventh

9Judge Curtin noted that:

Although in most cases state and federal funding is available for

reimbursement, there is no clear rule requiring the state to in-

demnify the counties for judgments entered against them.

464 F. Supp. at 724.

—

A-26

APPENDIX B (Opinion of the Court of Appeals)

Amendment protection of the county defendant is not necessary

“in order to protect the state treasury from liability that would

have ... essentially the same practical consequences as a

judgment against the State itself.” Lake Country Estates, Inc. v.

Tahoe Regional Planning Agency, supra, 99 S.Ct. at 1177.1

Under all the circumstances, we conclude that the County

defendant should not be treated as “an arm of the State” for

Eleventh Amendment purposes.

The remaining contentions of the County defendant require

less extended discussion. The claim is made that since the

County Commissioner acted in good faith in relying on section

131-k, under such cases as Wood v. Strickland, 420 U.S. 308

(1975), and O’Connor v. Donaldson, 422 U.S. 563 (1975), he should

not be held liable. This defense was developed so that a public

official, bound to take discretionary action of many sorts, often

on short notice, should not be burdened by liability or fear of it

because “of mistakes made in good faith in the course of .. . his

official duties,” Wood v. Strickland, 420 U.S. 308, 319 (1975)

(school officials); O’Connor v. Donaldson, 422 U.S. 563, 576-77

(1975) (employee of state mental hospital); Bivens v. Six

Unknown Named Agents, 456 F.2d 1339, 1347-48 (Medina, J.),

1348-49 (Lumbard, J.) (2d Cir. 1972) (on remand) (narcotics

10Plaintiff and defendants each cite to us a different decision of the Seventh

Circuit in support of their positions. In Mackey v. Stanton, 586 F.2d 1126

(7th Cir. 1978), petition for cert. filed, 47 U.S.L.W. 3776 (May 17, 1979) (No.

78-1733), the court held the Eleventh Amendment did not bar a judgment

against a county's welfare department. Conversely, in Carey v. Quern, 588

F.2d 230 (7th Cir. 1978), the Amendment was a bar. We regard these Seventh

Circuit cases as inconclusive and distinguishable. Mackey dealt with an

Indiana county's diversion of court-ordered child support payments which,

in the absence of its action, would have gone to the beneficiaries, in Carey v.

Quern, the public assistance taxes collected by the City of Chicago were paid

into a special purpose trust fund and amounted to only five percent of total

disbursements, the rest “supplied by the State of Illinois.” 588 F.2d at 233

n.5.

A-27

APPENDIX B (Opinion of the Court of Appeals)

agents). Here, as we now know after years of litigation, Reed had

no discretion; the money belonged to Mrs. Holley. There can be

no good faith defense to a claim for AFDC benefits that have

been found to be due and owing. Moreover, there should be no

good faith defense to a claim for AFDC benefits that were

wrongfully withheld, since such an award puts defendants in no

worse position than if they had initially complied with their

obligation. See Schnapper, Civil Rights Litigation After Morell,

79 Colum. L. Rev. 213, 252 (1979). Such benefits seem quite

different from damages under 42 U.S.C. § 1983 for violation of

constitutional rights of the sort involved in Monell v. Depart-

ment of Social Services, 436 U.S. 658 (1978), in which the

Supreme Court alluded to the possibility of “some sort of official

immunity” for “local government bodies.” Id. at 701.!!

Finally, even if the Eleventh Amendment does not apply, we

are urged to deny retroactivity under the criteria listed in the

alternative holding in Rothstein v. Wyman, 467 F.2d 226, 232-36

(2d Cir. 1972), cert. denied, 411 U.S. 92 (1973). We do not regard

the district court’s rejection of this argument as “an improvident

exercise of its equity powers,” id. at 236, in view of the in-

substantial fiscal effect of giving a remedy to plaintiff's

“minuscule sub-class” and the recognition by the New York

courts of the propriety of retroactive relief in welfare benefits

11At the end of his opinion for the majority, Justice Brennan stated:

Since the question whether local government bodies should be

afforded some form of official immunity was not presented as a

question to be decided on this petition and was not briefed by the

parties or addressed by the courts below, we express no views on the

scope of any municipal immunity beyond holding that municipal

bodies sued under §1983 cannot be entitled to an absolute immunity,

lest our decision that such bodies are subject to suit under §1983 “be

drained of meaning,” Scheuer v. Rhodes, 416 U.S. 232, 248 (1974). Cf.

Bivens v. Six Unknown Fed. Narcotics Agents, 403 U.S. 388, 397-98

(1971).

436 U.S. at 701.

A-28

APPENDIX B (Opinion of the Court of Appeals)

cases. See Uhrovick v. Lavine, 43 A.D.2d 481, 484 (3d Dept.),

aff'd, 35 N.Y.2d 892 (1974) (“to do otherwise would permit a State

to violate Federal requirements with financial impunity ....”);

Martin v. Lavine, 47 A.D.2d 731 (Ist Dept. 1975), modified on

other grounds, 39 N.Y.2d 72 (1976); Stewart v. Smith, 57 A.D.2d

897, 898 (2d Dept. 1977).

Turning to the award of counsel fees to plaintiff, the County

defendant argues that in the interest of justice the district court

should have denied such fees. The chief reasons given are that

the Civil Rights Attorney’s Fees Awards Act of 1976, 42 U.S.C.

§1988, was enacted after plaintiff Holley commenced her action,

so that she had neither a need for such a fee to guarantee access

to the courts nor a reasonable expectation of obtaining one; that

the legal services available to plaintiff are federally funded; and

that there was no bad faith by the County defendant here. But

recent decisions of the Supreme Court and of this court make

clear that none of these factors prevents an award of attorneys’

fees as a matter of law. See, e.g., Hutto v. Finney, 437 U.S. 678,

693-700, 694 n.3 (1978); Gagne v. Maher, 594 F.2d 336, 345 (2d Cir.

1979), petition for cert. filed, 48 U.S.L.W. 3001 (June 21, 1979)

(No. 78-1888); Zarcone v. Perry, 581 F.2d 1039, 1044 (2d Cir.

1978); Mid-Hudson Legal Services, Inc. v. G & U, Inc., 578 F.2d 34

(1978). Nor is it a bar to such an award that the district court

never decided the constitutional issue that was the basis of

jurisdiction under 28 U.S.C. § 1343(3). Gagne v. Maher, supra,

594 F.2d at 339-41. The attorneys’ fees issue is committed to the

discretion of the trial judge, id. at 345, who in this case pointed

out

The plaintiff sought and obtained broad equitable relief

which will benefit resident aliens in addition to the

plaintiff. Although the size of the group affected by this

litigation may not be large, the claim involved significant

federal rights. Because the plaintiff's claim did not in-

volve substantial monetary damages and is one which

A-29

APPENDIX B (Opinion of the Court of Appeals)

many United States citizens would regard as unpopular,

it is highly unlikely that the plaintiff could have retained

other counsel to act on her behalf. The cost of this

litigation and the time and effort required by plaintiff's

counsel in order to bring the case to its conclusion,

especially in light of the tvo appeals involved, plainly

were disproportionate to any sum the plaintiff might

reasonably have expected to recover on her own behalf.

All of these circumstances justify an award of fees to the

plaintiff.

464 F. Supp. at 725. We see no abuse of discretion here.

Appeal of the State Defendant

The State was successful below on its Eleventh Amendment

claim and a number of its arguments on appeal are merely

supportive of the County defendant’s position. Thus, as already

noted, the State defendant argues that since the County defend-

ant is an arm of the State for Eleventh Amendment purposes,

retroactive payments were improper and that an award of

attorneys’ fees against either defendant was inappropriate,

particularly since the Eleventh Amendment, as the district court

recognized, barred the damage award against the State defend-

ant. We see no need to add to our previous discussion except to

point out that Hutto v. Finney, supra, 437 US. at 693-98,

specifically rejected the latter argument. See also Gagne v.

Maher, supra, 594 F.2d at 341-43.

At oral argument, the State also contended that under the

Supreme Court’s very recent decision in Chapman v. Houston

Welfare Rights Organization, 47 U.S.L.W. 4528 (May 14, 1979),

the district court did not have jurisdiction over plaintiffs claim

that section 131-k conflicted with federal law. Chapman held

that 28 U.S.C. § 1343(3) and (4) did not independently give federal

district courts jurisdiction over such claims, confirming our

A-30

APPENDIX B (Opinion of the Court of Appeals)

earlier ruling in Andrews v. Maher, 525 F.2d 113 (2d Cir. 1975).

But jurisdiction over the statutory claim here is not original, but

pendent, as we held in our two prior opinions in this case. We do

not read Chapman as barring the exercise of jurisdiction over

the pendent claim here, which, as we see it, could be based upon

either a federal or state cause of action. As to the former. it has

generally been assumed that there is a federal cause of action to

enforce the Social Security Act.and HEW Regulations and that

such “suits in federal court under § 1983” are proper, see

Edelman v. Jordan, supra, 415 U.S. at 675-77; Rosado v. Wyman

397 US. 397 (1970).!2 Although Justice Powell took the position

in Chapman that there is no cause of action under section 1983

for violations of the Social Security Act, 47 U.S.L.W. at 4534-40

(Powell, J., concurring), only two other Justices joined in this

view, while four Justices disagreed and two took no position.!3

The Justices did not deal with whether a private cause of action

could be implied directly from the Social Security Act, see, e.g.

Cannon v. University of Chicago, 47 U.S.L.W. 4549 (May 14

1979); Cort v. Ash, 422 U.S. 66, 78 (1975), which a federal district

court would have jurisdiction to hear under the general federal

question statute, 28 U.S.C. § 1331(a). Of course, welfare benefits

cases do not ordinarily involve $10,000 so that the jurisdictional .

amount requirement would generally not be satisfied in suits

120 course, since the cause of action does not meet the jurisdictional

requirements of 28 U.S.C. §1343(3), it has had to be presented as a pendent

claim to another §1983 cause of action that asserts a violation of a right

secured by the Constitution or any Act of Congress providing for equal

rights, and therefore does meet the requirements of §1343(3).

13Justice Powell's opinion was joined by Chief Justice Burger and Justi

Rehnquist. Justice White, also concurring, disagreed with Tostinn Powell 1

this point, as did Justice Stewart in his dissenting opinion, joined in

relevant part, by Justices Brennan and Marshall. Justices Stevens and

aT did not find it necessary to reach the issue, see 47 U.S.L.W. at

A-31

APPENDIX B (Opinion of the Court of Appeals)

against state defendants.'4 But the absence of the jurisdictional

amount should not be controlling here when the district court

already has jurisdiction over the equal protection claim.

Moreover, plaintiff also has a state cause of action. The State

defendant itself points out that plaintiff could have sued in the

state courts for wrongfully withheld benefits, see Papadopoulous

v. Shang, 414 N.Y.S.2d 152 (App. Div. Ist Dept. 1977). Under

United Mine Workers v. Gibbs, 383 U.S. 715 (1966), the district

court had discretion to exercise jurisdiction over such a state

cause of action. Certainly on these facts, the federal court is an

appropriate forum to adjudicate the claim of conflict between

federal and state law. See Hagans v. Lavine, 415 U.S. 528, 548

(1974); Rosado v. Wyman, supra, 397 US. at 422-23; Andrews v.

Maher, supra, 525 F.2d at 120. Cf. Frost v. Weinberger, 515 F.2d

57, 62 (2d Cir. 1975), cert. denied, 424 U.S. 958 (1976). See also

Friendly, Federal Jurisdiction: A General View 123 (1973).

The State defendant also briefly attacks the scope of the

declaratory and injunctive relief granted by the district court.

The injunction requires the defendants to abide by the HEW

regulation; indeed, the language of the order is the language of

the regulation. We see neither failure to follow our earlier

mandate nor overbreadth in this. The rest of the State’s brief is

an anticipatory defense to arguments of plaintiff in her cross-

appeal, to which we now turn.

14There is now no such an amount-in-controversy requirement for suits

against federal defendants, see 28 U.S.C. §1331(a), as amended by Pub. L. No.

94-574, §2, 90 Stat. 2721 (1976). In 1978, the House of Representatives passed

legislation that would remove the jurisdictional amount requirement in

federal question cases, H.R. 9622, 95th Cong., 2nd Sess., 124 Cong. Rec. 1553,

1569 (Feb. 28, 1978), and both houses of Congress are currently considering

such bills.

A-32

APPENDIX B (Opinion of the Court of Appeals)

Cross-Appeal of Plaintiff

In her crossappeal, which is concededly filed for protective

purposes only, plaintiff argues at great length that the district

court erred in not granting damages against the State as well as

_ against the County. Plaintiff offers an elaborate theory to justifv

that result. First, she asserts her constitutional claim as an

implied right of action based directly on the equal protection

clause of the Fourteenth Amendment, under Davis v. Passman,

47 US.L.W. 4643 (June 5, 1979); Bivens v. Six Unknown Named

Agents of Federal Bureau of Narcotics, 403 U.S. 388 (1971), and

Turpin v. Mailet, 591 F.2d 426 (2d Cir. 1979) (en banc). She argues

for the right to assert this implied action even though she has an

explicit right of action under 42 U.S.C. § 1983 because under that

section she cannot get retroactive relief from the State. See

Quern v. Jordan, 47 U.S.L.W. 4241 (March 5, 1979). Second,

plaintiff deals with the problem of jurisdiction for this Bivens-

type action as follows. General federal question jurisdiction

under 28 U.S.C. § 1331 is unavailable because, as we have

previously held, 529 F.2d at 1295, the jurisdictional amount is

not met. However, plaintiff asserts that pendent jurisdiction is

available and that the Fourteenth Amendment claim can be

appended to her identical section 1983 claim, over which the

district court had jurisdiction under 28 U.S.C. § 1343(3), which

requires no jurisdictional amount. Next, plaintiff urges that the

State’s action in depriving her sub-class of illegal aliens of AFDC

benefits violates the equal protection clause. Finally, she claims

that the Eleventh Amendment does not protect states against

damage actions brought directly under the Fourteenth

Amendment.

Merely stating this complicated theory indicates the scope of

the problems involved in ruling upon it. For example, decision for

plaintiff would require at the very least determination of the

equal protection question on the merits, something which none

A-33

APPENDIX B (Opinion of the Court of Appeals)

of the courts that have considered this case have done to date. It

would also require holding that an implied right of action under

the Fourteenth Amendment overrides the Eleventh Amend-

ment. This would be a rather large extension of the Court's

decision in Fitzpatrick v. Bitzer, 427 U.S. 445 (1976), that

Congress, acting pursuant to section five of the Fourteenth

Amendment, can override the Eleventh Amendment by

manifesting an explicit intent to do so in a statute, Title VII in

that case. Cf. Jagnandan v. Giles, 538 F.2d 1166, 1182-85 (5th Cir.

1976), cert. denied, 432 U.S. 910 (1977). However, we see no

persuasive reason to consider these matters. We have already

concluded that plaintiff is entitled to a judgment against the

County defendant for the same amount she could recover against

the State defendant. Under the circumstances, we will leave to

another day consideration of plaintiff's alternative theory.

In conclusion, on the appeal of the County and State defend-

ants, we affirm the judgment of the district court in all respects.

We dismiss plaintiff's cross-appeal. In our discretion, we direct

that no additional amount for attorneys’ fees and no costs be

awarded to either party in connection with these appeals.

A-34

APPENDIX C

Judgment of the Court of Appeals

UNITED STATES COURT OF APPEALS

For the Second Circuit

At a stated Term of the United States Court of Appeals for the

Second Circuit, held at the United States Courthouse in the City

of New York, on the thirteenth day of July one thousand nine

hundred and seventy-nine

United States Court of Appeals

Second Circuit

Filed Jul 13 1979

A. Daniel Fusaro, Clerk

Present: HON. HENRY J. FRIENDLY, Circuit Judge; HON.

WILFRED FEINBERG, Circuit Judge; HON. EDWARD R.

NEAHER, District Judge.

GAYLE McQUOID HOLLEY, Individually and on behalf of

JAMES McQUOID, NORMAN McQUOID, THOMAS

McQUOID, DOUGLAS McQUOID, MICHAEL McQUOID,

AND ADELAIDE McQUOID, her minor children,

Plaintiff-A ppellant-Cross-A ppellee

v.

BARBARA B. BLUM, as Commissioner of the New York State

Department of Social Services (successor in office and function

to Abe Lavine, etc. et ano.,

Defendants-A ppellees-Cross-Appellants.

79-7182, 79-7190, 79-7207

Civ-75-151

A-35

APPENDIX C (Judgment of the Court of Appeals)

Appeal from the United States District Court for the Western

District of New York.

This cause came on to be heard on the transcript of record from

the United States District Court for the Western District of New

York, and was argued by counsel.

ON CONSIDERATION WHEREOF, it is now hereby ordered,

adjudged, and decreed that the judgment of said District Court

be and it hereby is affirmed and the cross-appeal dismissed

without costs in accordance with the opinion of this court.

A. DANIEL FUSARO,

Clerk

BY: SARA PIOVIA,

Deputy Clerk

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Eleventh Amendment to the Constitution of the United States:

ARTICLE XI

Judicial power of United States not to extend to suits

against a State.—The Judicial power of the United States shall

not be construed to extend to any suit in law or equity, com-

menced or prosecuted against one of the United States by

Citizens of another State, or by Citizens or Subjects of any

Foreign State.

Constitution of the State of New York

ARTICLE XVII

SOcIAL WELFARE

Section 1. The aid, care and support of the needy are public

concerns and shall be provided by the state and by such of its

subdivisions, and in such manner and by such means, as the

legislature may from time to time determine.

42 United States Code, Section 602(aX1\3)

§602. State plans for aid and services to needy families with

children

(a) Contents

A State plan for aid and services to needy families with

children must (1) provide that it shall be in effect in all political

subdivisions of the State, and, if administered by them, be

mandatory upon them;

_(3) either provide for the establishment or designation of a

single State agency to administer the plan, or provide for the

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establishment or designation of a single State agency to

supervise the administration of the plan;

(1976 Edition)

New York Social Services Law, Section 153

§153. Reimbursement and advances by the state

1. Expenditures made by social services districts, cities and

towns for public assistance and care and its administration,

pursuant to this chapter, shall, if approved by the department,

be subject to reimbursement by the state, in accordance with the

regulations of the department, as follows:

There shall be paid to each such district, city or town

a. the amount of federal funds, if any, properly received or to

be received on account of such expenditures;

b. the full cost of assistance and care provided state charges,

after first deducting any federal funds properly received or to be

received on account thereof;

(c) the full amount expended on behalf of the department for

public assistance and care furnished under this chapter to

mentally ill, mentally retarded or epileptic persons placed in

family care on conditional release from an institution in the

state department of mental hygiene and for the administration

thereof, after first deducting therefrom any federal funds

properly received or to be received on account thereof;

(d) fifty percentum of the amount expended for public

assistance and care for local charges, after first deducting

therefrom any federal funds properly received or to be received

on account thereof;

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(e) fifty percentum of the amount expended for ad-

ministration of public assistance and care to state and local

charges, after first deducting therefrom any federal funds

properly received or to be received on account thereof. The

provisions of this paragraph shall not be applicable to ex-

penditures for administration expressly provided for in

paragraph e;

(f) the full amount expended for administration of public

assistance and care to eligible needy Indians and members of

their families residing on any Indian reservation in this state,

after first deducting therefrom any federal funds properly

received or to be received on account thereof.

(g) fifty per centum of the amount expended for narcotic

addiction and drug abuse rehabilitative and preventive services

pursuant to this chapter, after first deducting therefrom any

federal funds properly received or to be received on account

thereof. In the event funds appropriated for such services are

insufficient to provide full reimbursement of the total of the

amounts claimed by all social services districts pursuant to this

section then reimbursement shall be in such proportion as each

claim bears to such total.

(h) after deducting any federal funds properly received or to be

received on account thereof, the full cost of services, including

the cost of administration thereof, provided to a person eligible

for services under title seven of article five of this chapter when

such person has been discharged or released or conditionally

released from a state department of mental hygiene facility or

from conditional release pursuant to sections 29.11, 29.15, 31.13

or 31.15 of the mental hygiene law and when such person was

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admitted to such facility and has been a patient therein for a

continuous period of five or more years prior to his discharge or

release. Such reimbursement shall not continue beyond a five

year period beginning at the date of such discharge or release.

For purposes of determining whether a person has been a patient

in such a facility for a continuous period of five years or more, if

a person who has been discharged or released from such a facility

is thereafter returned to such a facility within ninety days of the

discharge or release, the period of time between such discharge

or release and such return shall not constitute an interruption

of, and shall be counted as part of, the continuous period.

2. The following expenditures made by public welfare

districts for hospital care furnished pursuant to the provisions of

this chapter to recipients not eligible to receive medical

assistance for needy persons shall be subject to reimbursement

by the state in accordance with and to the extent authorized by

the provisions of subdivision one:

a. expenditures for such care for state charges, except as

provided in subdivision four of section sixty-two;

b. expenditures for such care for local charges, in the case of

children under the age of twenty-one years cared for away from

their own homes in accordance with the provisions of title two of

article six;

c. expenditures for such care for local charges, in the case of

and in connection with births of children born out of wedlock, in

accordance with the provisions of title two of article six;

d. expenditures for such care for local charges, in the case of

neglected, abused, abandoned or destitute children who have

been remanded, discharged or committed pursuant to the family

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court act of the state of New York. Hospital care in such case

shall be deemed to have been furnished pursuant to the

provisions of this chapter.

Nothing in this title shall be construed to authorize reim-

bursement for expenditures for hospital care for local charges

except as specifically provided in this subdivision. Any in-

consistent provision of this chapter or other law notwith-

standing, expenditures for hospital care shall be subject to

reimbursement by the state under this title only when the in-

vestigation of the application for such care and the decision and

the authorization to furnish such care is made by the county or

city public welfare official who holds the position and has the

title of commissioner or director of welfare, public welfare or

social welfare or any similar position and title denoting him to

be the administrative head of the welfare department of the

county or city, as distinguished from any other department

thereof which also may under certain circumstances administer

public assistance and care, or by an employee of such welfare

department duly authorized for the purpose by such county or

city public welfare official.

3. a. For the purpose of this title, expenditures for ad-

ministration of public assistance and care shall include ex-

penditures for salaries of the chief executive officers, their

deputies and the employees of local welfare departments;

operation, maintenance and service costs; and such other ex-

penditures, such as equipment costs, depreciation charges, and

rental values as may be approved by the department. It shall not

include expenditures for capital additions or improvements.

b. State reimbursement shall not be made for any part of the

salary of a chief executive officer of a social services department,

whose qualifications do not conform to those fixed by the

department or of a city or town service officer; nor shall such

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reimbursement be made on the salary of a deputy commissioner

or an employee, unless his employment is necessary for the

administration of public assistance and care and his

qualifications conform to those fixed by the department.

4. For the purpose of this title, expenditures made by social

services districts, cities and towns for the care and maintenance

of neglected, abused, abandoned or destitute children who had

been remanded, discharged or committed pursuant to the family

court act of the state of New York shall, if approved by the

department, be subject to reimbursement by the state in ac-

cordance with and to the extent authorized by the provisions of

subdivision one.

5. Inthe event the state elects to claim and receive federal aid

payments in accordance with the alternative formula authorized

by the provisions of section eleven hundred eighteen of the social

security act, for expenditures made under the state’s approved

plan for aid to dependent children, a social services district shall,

notwithstanding such election, be entitled to receive a state

reimbursement, in accordance with and to the extent authorized

by subdivision one. for its approved monthly expenditures for

aid to dependent children, the amount it would have been en-

titled to receive if such election had not been made, until the

month the amount it would be entitled to receive as state

reimbursement for its approved expenditures for such program

of assistance for such month, as a result of such election, is equal

to or greater than such district would have been entitled to

receive therefor if such election had not been made by the state,

any inconsistent provision of law notwithstanding.

6. a. Claims for state reimbursement shall be made in such

form and manner and at such times and for such periods as the

department shall determine.

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b. When certified by the department state reimbursement

shall be paid from the state treasury upon the audit and warrant

of the comptroller out of funds made available therefor.

c. When the monies allotted to the state by the federal

security agency, or other authorized federal agency, for aid to

dependent children for any quarter shall have been received by

the department of taxation and finance, the department shall, as

soon as possible, certify to the comptroller the amount to which

each social services district is entitled for such quarter and such

amount shall be paid out of the state treasury after audit by the

comptroller to the respective social services districts.

d. The department is authorized in its discretion to make

advances to public welfare districts and to cities and towns in

anticipation of the state reimbursement provided for in this

section.

7. Payment of state reimbursement and advances shall be

made to the fiscal officer of the public welfare district or city

entitled thereto pursuant to the provisions of this chapter; and

in counties where home relief is a town charge, such payment as

the towns therein shall be entitled to shall be made to the fiscal

officer of the county for the account of and reimbursement to

such towns, except in the case of a town which is a public welfare

district.

8. Any inconsistent provision of the law or regulation of the

department notwithstanding, state reimbursement shall not be

made for any expenditure made for the duplication of any grant

and allowance for any period, except as authorized by sub-

division twelve of section one hundred thirty-one of this chapter.

9. Any inconsistent provision of this chapter or other law not-

withstanding, any loss of federal funds assessed by the depart-

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(Constitutional Provisions and Statutes Involved)

ment of health, education and welfare against the state by

reason of the failure of one or more social services districts to

comply either with paragraph (e) of subdivision one of section

three hundred fifty and paragraph (c) of subdivision four of

section three hundred sixty-five-a relating to family planning

services for eligible individuals or with paragraph (g) of sub-

division one of section three hundred fifty relating to child

health screening and resulting treatment, shall be charged to

and borne by the social services districts responsible for such

loss. Each such district shall bear only so much of any such loss

as is attributable to its failure so to comply. The amount to be

borne by a district shall be determined by applying the ratio that

the number of cases in which it failed to comply with either

family planning or child health screening and treatment

requirements, or both, bears to the total number of cases in the

state in which there were failures to comply with either such

requirement, or both, as the case may be. A district shall have an

opportunity to be heard before the department's final deter-

mination to impose such an assessment.

(As amended by Law 1978, Chapter 555)