When the fee agreement process
does not apply, a representative can charge and receive a fee only upon
authorization of the Commissioner. Before
1991, the fee petition process was the norm.
Now the fee petition process is the exception to the rule. 42 U.S.C. § 406(a)(1) describes the exception
to the rule. The fee petition process
applies whenever the fee agreement process does not with limited
exceptions. HALLEX I-1-2-51. The fee petition process is set out in the
regulations. See, 20 C.F.R. §§ 404.1720 and 416.1520. Subsections (b) and (c) of those two sections
both provide for the petition, decision, and review process. This raises the question of the parameters of
agency discretion in setting fees.
A claimant can appoint a representative and that appointed
representative can delegate to other persons work on a claim other than the
actual appearance at a hearing. POMS GN
03910.025.B.3. That subsection states:
3. Delegation of Duties
Although an appointed representative
may not redelegate his/her authority to represent the claimant to another
person whom the claimant has not appointed,
the appointed representative is not required to perform every task related to
the representation personally. Appointed representatives often delegate
such tasks as developing the claimant's medical record or preparing written
materials regarding an appeal to an assistant. An unappointed assistant who is
supervised and directed by the appointed representative may perform tasks of
this nature, as long as the appointed representative personally makes the
decisions central to presenting the claimant's case before SSA.
A representative may not delegate to an
unappointed assistant the authority to undertake tasks that require making
significant decisions regarding the case. Whoever performs such tasks is, by
definition, a representative, and must be appointed as such by the claimant.
Appearing as the claimant's advocate in a hearing before an Administrative Law
Judge (ALJ), for example, requires making decisions about presenting evidence,
cross-examining witnesses, arguing facts and law, and appealing any adverse
ruling. Only an individual whom the claimant has appointed, and whom SSA has
accepted, as the claimant's representative has the authority to perform such
tasks.
The presentation of the arguments on the request for review
would appear to cross the line into a non-delegable duty. The question is whether a person not named on
a form 1696 may perform duties tantamount to representation. The regulations do not require an attorney to
use form 1696. 20 C.F.R. §
416.1507. That regulation states in
relevant part that:
We will recognize a person as your
representative if the following things are done:
(a) You sign a written notice stating
that you want the person to be your representative in dealings with us.
(b) That person signs the notice,
agreeing to be your representative, if the person is not an attorney. An
attorney does not have to sign a notice of appointment.
In footnote 2 of the inquiry, SSA states that a claimant may
only appoint a representative and that the agency does not represent a law
firm.
[i]
A reasonable
reading of secs. 404.905 and 416.1505 permit an attorney to act as a
representative in this matter in an independent capacity.
To the extent that only the appointee could
act as a representative in this matter, the services rendered to a claimant,
the appointee can delegate those duties.
This conclusion finds support where the Appeals Council accepts the
presentation of those arguments.
The appointee
should be the only person that submits a fee petition. But a claimant can appoint more than one
representative. POMS GN 03910.040 ¶ B.3. Where the claimant subsequently appoints the
de facto representative with a form 1696, that person becomes the appointed
representative nunc pro tunc. A claimant that signs that form 1696 knowing
that a de facto representative or delegee had undertaken substantial efforts on
his/her behalf. Validating representational
activities nunc pro tunc constitutes
a reasonable understanding by a subsequently appointed and ratified
representative.
The question
then becomes how to account for all the time.
The fee petition form does not permit a representative to parse out
services rendered as a delegee from those as an appointment
representative. Paragraph 1 of the form
SSA-1560-U4 directs:
Itemize on a separate page or pages the
services you rendered before the Social Security Administration (SSA). […] Attach to this petition the list showing the
dates, the descriptions of each service, the actual time spent in each, and the
total hours.
The form calls for the itemization of all services rendered,
not just those rendered after the appointment of representative got executed. Whether those services are compensable under
the petition of the ultimate representative or the earlier representative as
the delegor of those prior acts constitutes a question that elevates form over
substance. To refrain from making full
disclosure would have the net effect of misleading the agency as to the
services rendered and by whom those services were rendered. Whether those services are compensable to the
ultimate representative or a prior representative forms the core of the
question that the ALJ must ask as part of the fee authorization process.
The fee
petition form cannot direct the representative in the situation of
co-representation with overlapping or adjoining delegee and representative
status to violate the call of the question by both listing and not listing the
services the representative rendered from the Social Security Administration
both before and after date of appointment.
If a delegee does not list all the services rendered before the Social
Security Administration, then the agency could raise a concern that the delegee
failed to make a full disclosure.
The fee
petition form requires full disclosure and a delegee possessing a later formal
appointment should always list all services rendered. Where that second representative performed
all the services under the two hats, the agency would waste scarce resources by
requiring a fee petition for a supervising appointed representative and a
second petition from the later appointed primary representative. This observation rests not only on the nunc pro tunc later appointment but also
on the patent proposition that the claimant does not retain a firm or a
representative to invest time but to
secure a result. Factors 3, 4, 6, 7, and 8 do not focus on time and time should never become more than a guidepost to assess
reasonableness to avoid an unconscionable fee.
[i] Please note that a claimant
can retain a firm, partnership, or corporation.
HALLEX I-1-2-12.
